J.D. Vance’s GOP is for bosses, not workers

Many have interpreted Donald Trump’s selection of J.D. Vance as signaling a new age of Republican economic populism. In this view, until now, the precise ideological contours of Trumpism had been muddy, as the mercurial demagogue oscillated between populist heresies and conservative orthodoxy — vowing to impose price controls on pharmaceutical companies one day, fighting to slash taxes for the rich and gut Medicaid the next. Vance is one of the few Republicans who has actually tried to translate Trump’s populist impulses into a coherent agenda, one that “unnerves business elites” and thrills “pro-worker” conservatives. Given that Trump is 78 and ineligible for a third term, Vance is well-positioned to become the Republican standard-bearer in the near future, a development that could transform the GOP into a worker’s party, according to his populist admirers. Vance cultivated that impression during his address to the Republican National Convention Wednesday night. Vance characterized the GOP as a movement that would stand up for working-class communities like the one he was raised in and stand against the “ruling class” that had sold them out. “We’re done catering to Wall Street, we’ll commit to the working man,” Vance said. “We’re done importing foreign labor, we’re going to fight for American Citizens and their good jobs and their good wages. We’re done sacrificing supply chains to unlimited global trade and we’re going to stamp more and more products with that beautiful label, ‘Made in the USA.’” Vance’s commitment, though, to flipping the Republican Party’s class allegiances — and his prospects for doing so — have both been greatly exaggerated. J.D. Vance’s economic outlook is distinct from the market fundamentalism of Ronald Reagan or Paul Ryan. Vance is skeptical of free trade and immigration, believing that both erode the bargaining power of native-born workers by providing corporations access to cheap labor at home and abroad. In his telling, were US employers forced to rely on a smaller labor pool, they would have no choice but to pay higher wages and invest more in productivity-enhancing technology. Vance also supports state subsidies for the domestic production of cutting-edge products. As a Senate candidate, Vance voiced support for Joe Biden’s CHIPS Act, which subsidizes semiconductor manufacturers who operate in the United States. Once in Congress, he co-authored bipartisan legislation that would require companies that develop new technologies with taxpayer support to manufacture the resulting products within the US. He has also been willing to antagonize discrete segments of the capitalist class. With Elizabeth Warren, he cosponsored a bill that would claw back the pay of executives at large failed banks, a measure aimed at discouraging reckless risk-taking. And he has given rhetorical support to the Biden administration’s aggressive antitrust enforcement. Most heretically, Vance claims to support organized labor in theory, even if he’s less than enthusiastic about the trade union movement that actually exists. The senator has said that more American workers should be able to collectively bargain over pay and benefits but that the mainstream labor movement is “irreconcilably hostile to Republicans” and that left-wing unions like Starbucks Workers United deserve conservatives’ opposition. Nevertheless, Vance’s ascension to the highest echelon of Republican politics is unlikely to transform the GOP into an effective steward of working-class interests. This is true for (at least) four reasons: 1) Where Vance’s ideas have broad Republican buy-in — as on trade and immigration — his policy preferences would be more likely to reduce native-born Americans’ living standards than increase them. 2) Vance’s concrete legislative proposals for increasing government intervention in the economy have tepid support from other Republicans and in any case would have only a marginal impact on US workers. 3) The Republican Party is structurally incapable of acting on Vance’s genuinely radical ideas about organized labor and the Ohio senator has done absolutely nothing to advance them. 4) The GOP has little incentive to betray the interests of its most well-heeled and organized constituencies for the sake of better serving working-class voters. After all, the party has already discovered that it can grow its support among blue-collar workers without making any significant concessions to their material interests. Vance’s views on trade and immigration are anti-market but not pro-worker Vance is nothing if not an economic nationalist. He favors dramatically reducing immigration — particularly of undocumented and low-skill workers — and protecting domestic goods producers through expansive tariffs, such as Trump’s proposal for a 10 percent across-the-board duty on all foreign imports. It’s unclear how many Republicans support trade restrictions that radical. Trump has succeeded in cultivating broad support within the GOP for at least some forms of protectionism and immigration restriction. Yet such nationalism offers little of material value to the typical American worker. Vance detailed his populist case for immigration and trade restrictions in an interview with the New York Times in May. In his account, both free trade and expansive immigration erode American workers’ living standards by reducing their bargaining power: If companies can access laborers who hail from poorer countries (and thus have lower wage expectations) — whether they come to the United States or employers go to them — then native-born Americans will be unable to compete unless they accept lower compensation. There are two fundamental problems with this outlook. The first is that there is little evidence that immigration substantially harms native-born workers. Vance is correct that workers benefit from tight labor markets, where firms are forced to bid against each other for scarce employees, but high levels of immigration are compatible with such markets. When immigrants enter America, they expand the economy’s labor supply but also its labor demand, since immigrants (like all humans) consume goods and services. The immigrant share of America’s labor force surged as the Covid-19 pandemic eased, hitting a record high in 2023. This did not prevent US workers from seeing large increases in their nominal wages and reductions in unemployment over the same period, as demand for labor in many sectors outstripped its supply. It is plausible that a sudden surge of less-skilled immigrants into a given local labor market might, for a period of time, reduce the bargaining power of similarly skilled native-born workers in some sectors. Viewed in the aggregate, though, high levels of immigration appear to be economically beneficial for the native-born working class. The theory that immigrants drive down wages and employment opportunities for the native-born has been repeatedly tested. The consensus of the empirical literature suggests they generally do not. Studies have searched for an adverse impact on wages or jobs from the mass influx of displaced Syrians into Turkey, Dust Bowl migrants’ immigration to other parts of the US during the Great Depression, refugee migration to Sweden between 1999 and 2007, refugees immigrating to Denmark in the 1980s and ’90s, the mass movement of Russian Jews to Israel after the fall of the USSR — and in every case, found none. Meta-analyses of the research on immigration’s labor-market impacts have found little to no negative consequences for native workers. By contrast, empirical evidence strongly suggests that immigration increases labor productivity. A recent working paper from the National Bureau of Economic Research found that, between 2000 and 2019, immigration to the U.S. increased the wages of non-college-educated native-born workers by enabling a greater degree of labor specialization and, thus, productivity. Research from Harvard economist George Borjas has similarly found that immigration increases labor efficiency, thereby producing between $5 billion and $10 billion worth of economic value for native-born workers each year. Finally, immigration increases the ratio of prime-age workers to senior citizens in the United States, which makes it easier to sustain entitlements at existing benefit levels. Another problem with Vance’s plan to increase working-class prosperity through economic nationalism is that tariffs benefit manufacturing workers at the expense of all other workers, and the former comprise only a tiny minority of the US labor force. Fewer than 10 percent of American workers are employed in the manufacturing sector. That is not merely a consequence of trade policy: Even at the end of World War II, only a minority of US workers labored in a factory. Most US workers will therefore be primarily consumers of physical goods rather than producers of them, even if trade protection increases manufacturing employment at the margin. As a result, tariffs reduce the purchasing power of the typical American worker without increasing their bargaining power. At a time when Americans have expressed a profound sensitivity to rising prices, it is unlikely that many US workers would respond positively to a 10 percent tax on all foreign-made goods, were Trump and Vance to put their tariff plan into place. Vance’s support for small-scale populist reforms is clear. The authenticity of his avowed desire for radically increasing worker power is not. Some of Vance’s more idiosyncratic populist proposals are often more worthwhile. The senator’s plans, however, for increasing safety regulations in the railway industry, punishing reckless bankers, and promoting domestic production of advanced technologies have won very limited support from fellow Republicans. As a result, none have made it into law. It is conceivable that the GOP might grow more open to these reforms were Vance to eventually win the presidency, but only because they do not threaten to dramatically shift the balance of power between business owners and workers in the United States. Perhaps a Vance-led Republican Party might be willing to antagonize a small segment of corporate America, such as the executives of failed banks or railroad companies, but increasing labor’s leverage over capital throughout the economy is a different story. Vance has expressed interest in that radical pursuit. In an interview with the populist conservative Sohrab Ahmari, the senator voiced support for sectoral bargaining: an arrangement in which all the workers in a given industry collectively bargain with all of its employers over minimum pay, benefits, and working conditions. Oren Cass, a conservative policy wonk closely aligned with Vance, has also endorsed such a system. Sectoral bargaining would radically change America’s political economy, to the benefit of workers. Low-wage employers would no longer be able to secure a competitive advantage through union-busting, and the overwhelming majority of American workers who do not belong to a union would win greater leverage over their bosses. But Vance has not introduced legislation to establish a system of sectoral bargaining. In fact, as far as I can tell, he only mentions that policy when asked by reporters why he does not support any of the existing bills to increase union power in America, such as the PRO Act (Vance’s line is that the bill would further consolidate the nation’s status-quo labor model instead of moving it toward a sectoral system). Indeed, although Vance has rhetorically opposed right-to-work laws (which undermine unions’ finances by enabling workers who benefit from collective bargaining to shirk dues) and stood for photo-ops with striking workers, while in office he has done little to nothing to aid organized labor. In 2023, Vance voted with the AFL-CIO on 0 percent of the positions it endorsed; the average among all Senate Republicans was 3 percent. Beyond strengthening unions, federal policymakers can increase workers’ leverage by expanding the welfare state, thereby making it easier for Americans to walk away from exploitative employers. Yet Vance has evinced little interest in growing the safety net. Although he shares Trump’s rhetorical opposition to cutting Medicare or Social Security’s retirement benefits, Vance has not proposed any major new social programs. He has reportedly pledged to the anti-tax crusader Grover Norquist that he will oppose any proposal for raising taxes and told the Times that America can’t run “massive structural deficits indefinitely,” a pair of stances that effectively prohibit large expansions of social benefits. The GOP is a party of, by, and for bosses Even if Vance’s alleged “pro-labor” politics were indisputably genuine and thoroughgoing, the odds of the GOP embracing an authentically pro-worker agenda would be slim. It is true that the Republican coalition has grown markedly more working-class over the past eight years. In every presidential election between 1948 and 2012, white voters in the top 5 percent of America’s income distribution were more Republican than those in the bottom 95 percent. Since Trump’s ascent, this pattern has reversed, with rich whites voting to the left of middle-class and poor ones in both 2016 and 2020. In the latter election, Trump made some gains with working-class nonwhite voters, and polls suggest he is poised to build on those gains in November. [Media: https://twitter.com/thomasjwood/status/1375231548237213699] But just because Republican voters are getting more blue-collar doesn’t mean that the party’s agenda will inevitably get more pro-worker. When it comes to determining the content of a party’s policies, the views its voters express in opinion polls matter less than the demands its most powerful interest groups lay out in memos. Trump voters might be a bit more sympathetic to labor than Mitt Romney’s voters were in 2012. Economically left-leaning Republican voters, though, are not organized; they do not collectively fund institutions that monitor GOP lawmakers’ voting behavior and punish disloyalty through negative ad campaigns. Right-wing Republican capitalists do. Business owners in general — and staunchly anti-union ones, in particular — form the backbone of the institutional GOP. This is part of the New Deal’s long legacy: Once the Democratic Party aligned itself with organized labor, American businesses that could not tolerate an alliance with unions because their operations were labor-intensive and their profit margins were thin sorted into the GOP. Through industry lobbies like the Chamber of Commerce and the National Association of Manufacturers — and myriad think tanks and legal organizations bankrolled by industrialists — anti-union businesses built the literal and figurative foundations of the conservative movement. They have remained very much in control of the GOP in the Trump era. During his first term as president, Trump enacted large tax cuts for businesses and appointed a conservative National Labor Relations Board, which made it more difficult for workers to organize, particularly at low-paying fast food franchises. Business owners’ supremacy in the GOP may be most vivid at the state level. As Jamelle Bouie of the New York Times has noted, over the past two years, Republican lawmakers in Texas, Florida, Kentucky, and Louisiana have advanced legislation rolling back such basic worker protections as mandatory water breaks for outdoor workers, restrictions on working hours for child laborers, and lunch breaks for working minors. In some cases, the lawmakers backing these bills were business owners themselves. Vance’s selection will not change the class composition of the Republican Party’s political class nor shift the fundamental material interests of the most well-organized and well-resourced interest groups in conservative America. Even if the Trump-Vance ticket succeeds in expanding the GOP’s blue-collar wing, that will not reduce elected Republicans’ incentives to cater to low-road employers. To the contrary, if Trump proves yet again that Republicans can win working-class votes merely through immigration restrictionism and populist gestures, they will have little reason to offer such voters forms of material uplift that would threaten corporate America’s profit margins. The GOP is far less likely to remake itself in Vance’s image than vice-versa. After all, the vice presidential nominee has already proven willing to transform himself ideologically as the political winds shift. Between 2016 and his Senate race in 2022, Vance went from being a NeverTrump conservative to an unabashed champion of the January 6 rioters. The path of least resistance for a power-hungry Republican in today’s GOP is to be a populist in the streets but a servant of the bosses in the C-suites. In all likelihood, ambition will guide Vance in that direction. Or at least, so the militantly anti-labor tech billionaires who propelled him to the vice presidential nomination seem to believe. Update, 11:30 pm ET: This story has been updated with quotes from Vance's speech at the RNC.