Today, Niall Ferguson argues that last week’s midterms were just another case of a second-term president getting decked by the electorate in year six of eight, something America has seen many times before. In honor of Veterans Day, Barry Strauss recalls the Armistice that ended the First World War, and how it set in motion events that led to the rise of fascism in Germany. And Senior Fellow Thomas Dee finds that the number of US public schools has remained unchanged since 2020, and teacher employment is higher, despite educating more than 1 million fewer kids than they did before.
The Presidency
Yes, the Democrats thumped the Republicans in these midterms, writes Senior Fellow Niall Ferguson in The Free Press. But does this shellacking constitute the end of an era? Perhaps not. It was obvious, if the polls were believed, that the GOP was facing headwinds, but Ferguson points out the Democrats took a bigger beating in 2010. Ferguson argues that, as in other second-term presidencies, a confluence of factors, not just the impacts of the Iran war, came together to spell defeat for President Donald Trump. “According to exit polls. It was corruption that was ‘crucial or major’ for 90 percent of those polled. Cost of living was next (89 percent), then the Iran war (74 percent)—only just ahead of immigration enforcement (73 percent),” he writes. So, what’s next? Ferguson suggests “it’s just the beginning of the Biden phase of the Trump presidency.” Read more here. [Subscription required.]
Veterans Day
Senior Fellow Barry Strauss marks Armistice Day in Military History in the News by recalling how the shooting stopped at 11 a.m. on November 11, 1918, a relief he shares personally, since his machine-gunner grandfather was still fighting the Germans that morning. US Army General John Pershing opposed the armistice, arguing it would revive German spirits and deny the Allies full victory; he wanted fighting to continue until unconditional surrender. Because many German troops marched home in good order, many Germans never felt defeated, were shocked by Versailles, and embraced the “stabbed in the back” legend that Hitler exploited in the 1930s. Pershing’s concerns proved prescient, but exhausted, pandemic-stricken Allies lacked the will to go on. Strauss cautions that Nazism cannot simply be blamed on the armistice yet reminds readers how the ending of one war can set the stage for another conflict. Read more here.
Freedom Frequency
In this week’s installment of The Grumpy Economist Weekly Rant, Senior Fellow John Cochrane examines whether inflation can return to lower levels without triggering a recession or higher unemployment. He explains how expectations of future inflation influence current prices and wages, and why the Federal Reserve cannot bring those expectations down through promises or higher interest rates alone. Drawing on historical examples from Europe, inflation-targeting reforms in the 1990s, and Argentina’s recent hyperinflation experience, Cochrane argues that credible fiscal and economic reforms can reduce inflation without the conventional costs of monetary tightening. He makes the case that lasting disinflation requires addressing the underlying causes of inflation and making a credible commitment to price stability. Watch his rant here.
Economics
On the latest episode of Economics, Applied, scholars Panle Barwick and Myrto Kalouptsidi join Senior Fellow Steven J. Davis for a lively discussion on the economics and history of the shipbuilding industry. The US dominated global shipbuilding during World Wars I and II but could not sustain its competitive position afterward. China has come to dominate global shipbuilding in the 21st century but at great cost to its own people. Davis and his guests discuss economic and policy factors that drove these developments and draw lessons for the practice of industrial policy. Watch the episode here.
K-12 Education
In a new paper for the Annenberg Institute, Senior Fellow Thomas Dee and coauthor Jaymes Pyne present data that shows stunning drops in public school enrollment as of 2024. Looking at more than 105,000 schools across the nation, they find public schools have 1.4 million fewer students than before the onset of the COVID pandemic, but the “number of operating schools is effectively unchanged while the number of teachers increased.” As many as a quarter of all schools in the nation now have enrollment at least 15% below their pre-COVID baseline, and pupil-to-teacher ratios have fallen by an average of 4%. The school closures have largely occurred in areas least likely to be able to adapt to a school closure. As the authors show, school closures have been most common in lower-income neighborhoods and among schools serving higher numbers of Black students. Read more here.
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