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Your guide to what the 2024 US election means for Washington and the world
The idea of “two Americas,” one rich and one poor, one blue and the other red, has been around for decades. But now, thanks to Donald Trump, there are about to be fifty Americas.
As fast as the new president can sign executive orders, individual state governments are stepping up to challenge them in court. The upshot will be a more confusing environment for business — and a richer one for lawyers — as blue states look for ways to shield themselves from immigration raids, weaker environmental regulations, Big Tech monopoly power and massive cuts in federal aid for everything from healthcare to emergency relief.
The lawsuits, which were rife during Trump’s first term, began again last week as Massachusetts, New Jersey and California led a group of 18 states in filing a challenge to the president’s executive order ending birthright citizenship. Four other states filed a similar suit. As Massachusetts attorney-general Andrea Joy Campbell put it, “birthright citizenship . . . is a guarantee of equality, born out of a collective fight against oppression . . . It is a settled right in our Constitution and recognised by the Supreme Court for more than a century.”
While one can only hope that today’s conservative court won’t approve a modern-day version of the 1857 Dred Scott decision that prohibited citizenship for enslaved people, the battle will be expensive and protracted. Ironically, a series of rulings made by the Supreme Court at the end of 2023 actually make it much easier for individuals, businesses and aggrieved states to take on the federal government.
Blue state governments are, for example, taking charge of many of the monopoly fights waged by the Biden administration. Minnesota’s progressive attorney-general Keith Ellison has replaced former Federal Trade Commission chair Lina Khan as the face of the war on predatory ticket prices, algorithmic manipulation of real estate markets, grocery monopolies and rent-seeking pharmaceutical companies.
States will also be ground zero for the rollback of climate legislation, including Biden’s Inflation Reduction Act, which Trump insists on calling the Green New Deal. While the president may seek to rebrand some of the provisions that benefited red states as his own, he’s dumping subsidies for things like electric vehicles.
California is preparing for the coming climate battle. Between 2017 and 2021, the state sued the Trump administration 123 times, racking up several wins against environmental deregulation, albeit mostly on administrative grounds. This time around, the Trump administration has experience and better bureaucratic chops. California has already withdrawn several requests that it had been granted under the Biden administration to enforce its own higher pollution restrictions. And Trump is threatening to withhold federal disaster relief for LA unless the state changes its water management, blaming conservation efforts for the city’s inability to get fires under control.
California Governor Gavin Newsom has requested $25mn from the state budget to cover expected litigation costs from battling Trump. The state will also use the power of its own enormous economy (the fifth largest in the world) to try and cut deals with big companies that meet its own clean energy standards, as it did with major global automakers during the first Trump tenure.
This is an important point. The blue states are home to most of the country’s biggest and richest consumers. They can create strong demand signals for the rest of the country, even if the president doesn’t like it. When the New York City Housing Authority, for example, decides to adopt a certain kind of window, it can set industry standards for years. When California or New York or Illinois or Massachusetts select a certain kind of technology platform for public education systems, or a particular food safety rule, or a certain approach to labour and AI, it can tip the balance of what companies do.
Of course, the economic pull of doing business in such places will also be balanced against the regulatory burdens they impose, particularly relative to red states that will be happy to adopt Trump’s deregulatory, laissez-faire agenda. A friend of mine with a small business recently spent a year and tens of thousands of dollars in legal fees trying to safely fire a lazy and potentially litigious person she’d hired in California who worked remotely. Her replacement is from business-friendly Tennessee.
Historically, US states tend to band together best when fighting against something, and this time is no different. Last November, Illinois governor JB Pritzker and Colorado governor Jared Polis created a new group called Governors Safeguarding Democracy, with the aim of pooling resources to combat the Trump agenda. Pritzker, for example, has said he won’t co-operate if Trump tries to use red state National Guard units for deportations in blue states. Would California send resources to help?
Here’s hoping such questions remain the stuff of dystopian films. The reality is that blue states, many of which have big deficits, will have to find ways to cope with less fiscal support from Washington. Conservatives are already calling for a new kind of fiscal federalism, blaming overgrown state budgets for the national debt problem. No prizes for guessing where the first cuts will be made.
rana.foroohar@ft.com