Saturday, April 30, 2016

A good enemy to have

Candidates are defined by what they are not

John Kasich came to Medford and put on a show.  It was the I'm-not-Trump-or-Cruz show.    Cruz is busy spinning John Boehner's comment that Cruz is Lucifer into a badge of honor.   Trump regains angry protesters with Mexican flags and "socialism" signs.

Sweet are the uses of adversity.  

Kasich had a memorable Town Hall in Medford, memorable for what did not happen.    What he said was quiet--charming even--as he discussed successes in Ohio state government.  He reduced food stamp costs.  He balanced a state budget.  He took on local nursing homes to help Ohio seniors stay in their homes.   He spoke about his Republican opponents exactly once, saying he was running for president as an optimist who would not "make a spectacle of himself" in an effort to get elected.

Kasich in Medford:  Mr. Nice Guy
That's it, for criticism of Trump and Cruz on April 28, 2016.   Back in November in New Hampshire when I saw Kasich at two long events he spoke firmly about national issues: foreign policy, Obamacare, abortion, budget balancing, immigration, border walls, taxes, and in the various televised debates he mixed it up with the others head-to-head.  

But in Medford he never mentioned and of the very things that are matters of vigorous GOP contention within themselves and against Hillary Clinton.

This is not a retreat.  It is a strategy.   Kasich is defining himself as the unexceptional lowest common denominator of Republicans, the universal solvent.  It could be his ticket to the White House because his strategy requires him to be both different from--even opposite to--Trump and Cruz and simultaneously not irrevocably estrange them and their supporters.   If there is convention deadlock, and if neither Trump people nor Cruz people can give in to the other then possibly Kasich would emerge as the compromise candidate acceptable enough to nominate and because he is disliked least.   It is a long shot, but it could happen, and therefore Kasich defined himself by what he is not--not an angry, high-drama Trump or Cruz.

Cruz, trusted to reform Washington
Meanwhile, Cruz had been defining himself as an establishment-credentialed anti-establishment Republican but was drifting away from that image when establishment Republicans saw him as the only alternative to Trump.  But now Cruz is going back to home base by doubling down on the outsider image after Boehner's comment that Cruz is a nasty SOB and worse than the devil himself.   Tough words from Boehner, repeated constantly on every media channel except Fox News.

Boehner sends Cruz back to being the outsider-reformer.   Boehner is "everything that is wrong" with Washington, Cruz said, adding, "What made John Boehner mad is that I led a movement to hold Washington accountable."    This is the positioning that got Cruz this far: the angry outsider, and it works among highly partisan Republican voters.   At the Tea Party Convention in Charleston, SC I watched Cruz bring the crowd to its feet when he blasted Boehner for compromising with Obama and the Democrats in Congress sufficient to pass a budget.  Cruz and the audience wanted the government shut down.   Boehner and Obama were common enemies, Cruz said, and the crowd loved it. 

Cruz's image had been getting confused as he drifted toward being a "normal" Republican, endorsed by the Stop Trump movement but Boehner's comments ended that rapprochement.    Cruz is back to being Cruz.
Hillary responded adeptly

And meanwhile, Trump.   Trump, too, must welcome the re-emergence of a perfect enemy in the form of angry protesters.   His criticism of Hillary and the "woman's card" had mixed results and high risks, as I observed two days ago.   Hillary embraced Trump's criticism, and her campaign brought out a "Woman's Card" for supporters to brandish.   Trump will likely return to this line of criticism, perhaps after having a chance to refine the message.  But in the meantime he has a much better opponent which moves the news cycle attention to much surer ground: Hispanic protesters with Mexican flags, and pro-Socialism signs.   Perfect for Trump.

Perfect contrast for Trump
Trump voters want a strong leader, who understands the world in common sense right versus wrong, foreigners first versus Americans first.   The anti-Trump protests are exactly what Trump needed.  Trump wants to position himself as the opponent of disorder, internationally and domestically, with the easiest domestic target being disorder by Mexicans.   The contrasts are perfect for Trump.  Protesters vs. police.  Mexican immigrants vs. white native born.  Mexican flags on American streets vs. the American flag.  Traffic blocked vs. traffic flowing.   Brown faces vs. white faces.
Protest signs

Trump called the protesters "thugs and criminals."   "It felt like I was crossing the border. . . . They should be dealt with strongly by law enforcement."

The political image of each of the three Republican candidates are firming up, in part thanks to the heightened opposition they face.  
Making Trump look respectable

Trump is the strong guy, opposed by illegitimate people who don't belong here in the first place.   Trump likes that positioning.

Cruz is the reformer Senator with credentials to lead, opposed by the powerful Washington establishment because he intends to fix a corrupt system.  Just what Cruz wants.

Kasich is the nice reasonable guy, the one Republicans can rely on if they cannot get along and need someone reliable and competent to turn to in a pinch.  Kasich is who he is not, not Cruz or Trump.

Friday, April 29, 2016

Kasich comes to Medford, Oregon

Kasich is the Alternative to Trump and Cruz

Low platform, wooden stool, one water bottle
John Kasich came to Medford and gave a talk that is entirely different from one that would be given by Trump or Cruz.    It is either a "Hail Mary" attempt to win with an entirely different approach or he has moved into the Acceptance phase of a candidacy in hospice and he decided it is time simply to teach Americans, not persuade them.

It was low drama.

There were seats for about 250 people and another 150 or so stood.   The event lasted about 80 minutes.

He spoke at my old high school.   He questioned whether this was the home of the "Black Tornado".   Thanks to seats reserved for Bill Thorndike, a prominent Medford businessman, I sat up front.  As the crowd shouted out confusing answers about whether it was the Panthers or Black Tornado he handed me his microphone.  I said it was the original home of the Black Tornado, then the District built new schools.   That settled that.   

Donald Trump would never have relinquished the microphone.

Relaxed.  Comfortable Shoes
John Kasich was warm, self-effacing, conversational.  He spoke from a 8 inch platform in the middle of the room, surrounded by an audience.   The school has an auditorium with a raised stage and lecterns, which had theater seating in place--the Commander in Chief arrangement.   He chose this setup instead.

He made constant reference to his role as a governor who solves practical problems in a large and diverse state.  He was re-affirming the GOP as a party of governance rather than protest and ideology.    From time to time he referenced Congress and his role as head of the House Budget Committee in the mid-1990s, saying it showed he could balance budgets, but most of the time he spoke as Ohio Governor.

He said governing is hard and it requires acknowledging messy truths (like that safety net programs are necessary even though there will be cheaters, and that taxes need to be paid if we are to have things we want, and that some programs--farm subsidies -exist because some people want them and will throw out politicians who oppose them).  Several times he prefaced his comment by warning that we were not going to particularly like what he had to say but it was important we understand something.

This speech was an appealing civic conversation.  There were campaign signs on the wall, but it wasn't a campaign rally.   It was an exhortation to be good citizens, making me think either he has given up the expectation to be elected president or he has calculated that his only real chance of election is to be utterly different from Trump and Cruz, which would make him the clear alternative if Trump and Cruz were to deadlock.

Explaining, not exhorting

Trump and Cruz are giving entirely different presentations.   They focus on ideology and they rally crowds to clear, simple, popular ideas.  They start with a premise that Kasich did not present: that the country has been in a death spiral these past 7 years, that Obama and Hillary Clinton have been a disaster in office, that the economy is much worse now than it was when Obama was elected, that unemployment and economic distress are at Great Depression levels, that the citizens of this country are frustrated and angry and that they share that anger.

They see problems and they have solutions:

***We can build a wall and solve an immigration problem.

***We can have security in the Middle East by deciding to bomb more and realizing that we are at war with Islamic terror.

***That we can solve the budget problem by eliminating the emergency phone program--Obamaphones--a useless and expensive program.

***That we can increase the military significantly and cut taxes sharply and balance the budget, simultaneously.   It would be easy.   

***You keep your Social Security and Medicare, no problem.

***That Obama and Hillary Clinton have ruined America through a combination of weakness and tyranny, but that the course of America's future will be reversed if we simply elect them.

These speeches bring audiences to their feet with frequent, sustained applause.

In addition, there is a vast difference in tone between a Cruz/Trump presentation and the one Kasich delivered in Medford last night.   Trump is triumphant.  He commands the stage and the event.   He entered the Boca Raton arena with a helicopter overflight amid thundering triumphant music (theme from the movie "Air Force One") while Kasich's  just quietly walked into the arena.   

Cruz enters his venues with less fanfare than Trump, but his speeches put him in a commanding position.  He is firm, indeed angry, because the stakes are so high, good vs. evil.  He is decisive.  Cruz's speeches hammer out well prepared ideological zingers ("My opponent is either a cranky radical socialist communist who is out to destroy capitalism--or Bernie Sanders.") while Kasich took random questions he then actually addressed.

Kasich never raised his voice, never adopted an adamant shouting tone common in political speech, not even at the end when he asked for our vote.

John Kasich's approach to questions and answers was radically different from the norm in presidential campaigns.  Candidates in Town Halls can easily take questions from the audience to prove how knowledgeable and flexible they are because there are only a limited number of subjects questioners raise, and in fact the candidate only pretends to answer the question.   Questions are simply an excuse to bring up a subject from the "issue bank."   A question by a college student gets interpreted to be an invitation to give the 90-second stump speech section on college.  A question by an elderly person triggers a brief nod regarding the specifics of the questioner and then a 90-second stump speech on Social Security.   A nurse question triggers the End-Obamacare blast.  Everyone does it.  But not Kasich last night.

Up close at the old gymnasium, place for "sock hops"
Kasich approached Q & A as if from a party of governance, not ideology and protest, and as if the Medford audience were people he represented at our state capitol and who expected direct answers      Kasich actually addressed the questioner and stayed with the specifics of the concern, even when it created a complicated politically unsatisfactory answer rather than a well-practiced speech.   

A high school junior said college would be really expensive.  For five minutes Kasich spoke about high school advanced placement options, the need to do well enough in high school not to have to waste time in college in remedial classes, then the cost of community college, then the transferability of those credits, then the cost of the U of Oregon, and how it would mean college would cost maybe $50,000 not $150,000, and that he would earn enough as a college grad to pay that back.    Politically this is much less appealing than saying that "Public colleges should be free!" (Sanders), or "Obama has presided over runaway college inflation destroying the hopes and dreams of America's youth", which would be a satisfactory answer to a Republican audience there for a political rally.   I have seen it done dozens of times.   But not last night. 
Bill Thorndike greets Kasich

Was this good politics?  Was it effective political communication?  My sense is that the crowd left the auditorium with the lowest amount of pumped-up enthusiasm of any talk I have heard by any of over 40 campaign events over a 6 month period and this includes Town Meetings given by Jeb Bush and Lindsey Graham in New Hampshire.   The crowd was informed but not inspired.  There was no sustained standing ovation; people smiled, clapped, and filed out.

The crowd may well have been quietly impressed and he may well have won votes.  But there were no cheers.

Kasich presented a candidate who represented competent, compassionate governance with practical and unexceptional attempts at solutions to problems.    Changes would come incrementally--just the way Hillary says they would come--only pushing in the opposite direction from Hillary.    The final photograph shows the audience late in the event, and I have enlarged it so readers can better read the faces of the crowd.   Kasich was appealing and interesting to them.  But their hands were folded in quiet contemplation not enthusiastic support.

The most interesting thing in this photo is the audience.  Note their affect.

Thursday, April 28, 2016

Trump's Woman Problem

Trump's Brand is not to be P.C. regarding women.

When Trump disses Hillary, he disses women.   He needs to tear down Hillary but must not disrespect women while he does it--a difficult task.

Trump is unashamed of being non-PC regarding women, and it wins him support.  Trump voices what many people actually feel but have been cowed into repressing.

A hot wife: part of the Trump brand
Donald Trump flaunts his young, model wife.  He slut-shames Fox's Megyn Kelley.  He ridicules Rosanne Barr for being fat and Carly Fiorina for being too ugly to be electable.   He re-tweeted photos contrasting his sexy wife Melania with an unflattering photo of Cruz's wife Heidi exemplifying an unapologetic old-school oneupmanship.
Trump slut-shamed Megyn Kelly

As Trump attempts to gather up the remaining delegates to get him the nomination he is narrowing his focus of ridicule to Hillary Clinton, which unifies the GOP under the one idea that all factions agree on, contempt for Hillary.   Trump's traditional mode of attack on others is to undermine them, not to disagree with them.  He de-legitimizes them, he does not oppose them.  

De-legitimation is Trump's strength, but it may become his weakness.  Trump wants to ridicule Hillary, not women generally, but because his attacks are personal and not policy-based, it has a subtext of ridicule of women.  He repeatedly says that Hillary lacks the "stamina" to be president.   He says that her speeches sound like shouting to him and he cannot stand it.   Of course whether she is up to the job physically is a matter of legitimate inquiry and it is undeniable that her political speeches are given in a shouting tone but Trump's comments come across as a criticism that goes beyond Hillary personally.  

Some women hear something they don't like.  He is dissing women.  

Many men will not hear it and Trump may honestly think he is not one bit guilty of it.  Many men are confident it simply is not there.  I consider it to be a dog whistle, something many women do hear as subtext even as their tone deaf fathers, husbands, and sons deny its existence.   

We do not even need to question whether it is "really, actually" there.  If a reader doesn't think it is there I have no need to try to persuade anyone.   It is enough to note that many men do not hear it and many women do.   This includes influential women.  Republican women.

Some people perceive male privilege and others do not.  Each side has resentments over unfair advantage, either for discrimination ignored or for discriminated invented to justify reverse-discrimination.

The Republican campaign moved away from attempting to create a broader coalition that included Hispanics toward a narrower but more motivated one, writing off people of color, immigrants, and the LGTB community with policies that are overtly in opposition to them.   Trump and Cruz think they can win with "normal" people, i.e. whites.    But Republican candidates need both white men and white women.  The opening salvo of the campaign was the very first question voiced by Megyn Kelly in the very first debate, an question addressed to Trump:

You've called women you don't like 'fat pigs, dogs, and disgusting animals' ... how will you answer the charge from Hillary Clinton ... likely to be the Democratic nominee, that you are part of the war on women?"

Trump called the question unfair, thus starting a feud with Kelly that helped the careers of both Trump and Kelly.   But the question was raised and Trump did not apologize.  He doubled down.

Now Trump is refocusing his campaign onto Hillary Clinton.  Hillary is a white woman, and Trump's criticism of her bleeds over to criticisms of women generally, and this is a big problem for Trump.    Some white Republican women are hearing that dog whistle of contempt, thinking it is for women generally, not just Hillary.   They are hearing what Megyn Kelly heard.

Carly: "Trump has a problem with women"
In the early campaign the only real body blow faced by Trump was the counter-attack by Carly Fiorina following Trump's having said she was too ugly to elect.  She stood tall, put out an ad saying that Trump's remark was disrespectful to all women young and old and she for one embraced the wrinkles and wisdom in her 60 year old face.  She repeated this on stage at the next debate.   She looked strong; Trump looked petty.  Trump retreated.

Ted Cruz has done the unprecedented act of announcing his choice for VP, in an obvious effort to claim GOP women as Cruz voters.   Yesterday Carly said, " You know, I think Donald Trump clearly has a problem with women.  Clearly.  I mean, the week we had a terrorist attack in Brussels, he attacked Heidi Cruz."

Trump may attempt to particularize his criticism his criticism to Hillary alone, but it is a fine distinction that may be impossible.   Hillary embraces being a woman, and the delegitimization tactic focuses on identity, not policy.    Since  Trump demeans the status and person of the opponent (Weak Bush, Little Marco, Lyin' Cruz) when he delegitimizes Hillary he attacks her gender.    

Hillary herself may be no better than Trump's other victims at blunting Trump's attacks but she has unintended and unexpected allies: women from all political persuasions who hear the anti-women dog whistle of contempt, they think it includes women generally,  and they resent it enormously.   
Mary Pat Christie

I have used photos of Chris Christie's wife Mary Pat multiple times in this blog to illustrate the face of the loyal political wife.  She beams up at her husband.   But she rolled her eyes in sardonic disagreement with Trump as he said of Hillary, "The only thing she's got going for her is the woman's card, and the beautiful thing is that women don't like her."
Mary Pat isn't buying what Trump is selling.  Watch.

Watch her yourself in this 4 second video. Eye Rolling Video

Men can be tone deaf to things that women can hear.  Trump's brand is in fact to be tone deaf to all the little political niceties, that irritating PC stuff.  It has worked for him, but it may not work here.

Trump's strength is his weakness, as it affects women.   Trump can tear down Hillary and he can win the general election, barely,  without the support of people of color and gays.   But he cannot win without women, and somehow he needs to destroy Hillary without destroying what Hillary considers a central part of her brand: her gender.

Wednesday, April 27, 2016

Trump Wins Majorities

Trump's Ceiling has gone up.   A confident Trump insults Hillary.

Trump detractors and skeptics have been saying for months that Trump has a low "ceiling", meaning he is a minority candidate who can get a plurality of 30%--then 40%--but never an actual majority.

Trump just won big majorities, making him a fully legitimate nominee.

Meanwhile, he de-legitimizes everyone else.

Trump followed up his win in New York State with decisive majority wins in five states last night.   And today's news describes Pennsylvania's unbound delegates supporting Trump  on the first ballot.   Unbound delegates for Trump?   Isn't that a game changer?    Yes it is.

As you see in the Guest Report Post uploaded earlier today, being a caucus goer is a lot of work, and being elected to the next level up (Legislative District, in the State of Washington) is even more work and time and frustration.   To be a delegate at the national convention is not just a fun little prize.  People get elected within a caucus system or a delegate selection system by going to lots of meetings.   These are party loyalist people, the folks you will see down at Party Headquarters every day answering phones and telling people where to get lawn signs.   They staff the booth at county fairs.   They supported Romney, and before him McCain, and before him Bush, and before him Dole. 

It is natural that they support Cruz or Kasich.  Kasich exemplifies the GOP orthodoxy and Cruz purifies it and says he strengthens it, while Trump remakes it.   So what would those unbound delegates see in Trump?   They see a winner, in part because he has made everyone else a loser.

It is not simply that he did, in fact, win in Pennsylvania with an actual majority, although winning with a majority conveys enormous legitimacy.   It is also the fact that they can imagine Trump in triumph in the general election.  Caucus goers up through national convention delegates are united by being Republicans, and these activists are energized by hating Hillary Clinton.   They know the enemy: she is a dishonest, sold-out, ultra-liberal, socialist, military-hating, Benghazi-lying, email-cheating, rape-enabling, baby-killing Democrat.     I talked to GOP activists in 5 states and the one thing they have in common is a conviction that Hillary is evil.

Trump has been mocking and belittling Republicans as he kills them off one by one, showing them not simply to be incorrect but illegitimate.  Canadian Cruz.  Lyin' Cruz, 1 for 36 Kaisich, Little Marco, Too-ugly-to-elect-Fiorina, Low Energy Bush.  Note that he isn't contesting them on the merit of their argument but rather their essential unworthiness to be in the ring with him.   Now he is delegitimizing the caucus system in the GOP: "It's rigged!"  He is delegitimizing his two remaining opponents:  "They're colluding!"

I predict Trump will bring to his side more than enough uncommitted delegates because those Hillary-hating delegates will imagine the general election victory as they savor the thought of Trump's new victim, Hillary.

Trump is very, very good at delegitimization.  He attacks people in a vulnerable spot that blunts their weapon of counter-attack.   When Trump manages to brand Cruz as "Lyin' Cruz" he brings into question whatever Cruz might say in response .  Who can believe someone named "Lyin'"?    

Trump has focused on Hillary's delegitimizing her:  
  ***Maybe she won't even be the candidate, he keeps suggesting, because she will be under indictment.
  ***Whatever she says about policy can be dismissed because she has sold out to PACs and Wall Street buddies, just like Bernie says, and is just their mouthpiece.
   ***Last night, in his victory speech, twice he suggest she won't even be his only opponent because Bernie could and should run as an independent. 
  ***He said Hillary's use of a bathroom was "disgusting", i.e. something objectionable even to consider.
  ***Last night in his victory speech and again on the morning shows this morning Trump said that her comments on equal pay and reproductive rights were phony as policy positions and can because it was simply Hillary "playing the woman card left and right. . . . and she will be called on it.  Absolutely."
  ***And last night and this morning Trump complains about the need to "recover" from listening to Hillary's speeches since they are unlistenable because of her shouting.

His complaint about Hillary's shouting has traction.  Trump doesn't shout.  He has a microphone so he talks.  He sneers.  He makes faces and gestures.    Only in the final minute of a 40 minute talk does he rise to a shout when he finishes with a promise to win, win, and win some more, win until you are sick and tired of winning so much. 
Hillary attempts to convey passion by shouting, beginning with her first sentences.  She sounds like the traditional old-style politician speaking with righteous anger with un-amplified voice to a crowd of 500, except of course she has a microphone into which she shouts.  Her voice is hoarse because of it.    By calling attention to it Trump is de-legitimizing her speeches, oh, the pain, who can stand to listen to her, her shouting, just another woman shouting?

Shouting in Portland: the next victim.
Uncommitted GOP delegates are hearing Trump and are considering how delicious it will be to have Trump demean and torture Hillary just the way he tortured the other victims in his path.   Back on April 19 I posited that Trump might have to send thugs to intimidate delegalizes with threats of murder.   I under-estimated Trump.   

He will get his delegates by doing the work himself--the work of demonstrating that he is fully capable of doing sustained torture on his own, publicly, with relish, with words and gestures, demeaning and de-legitimizing Hillary. 

The delegates will like the thought of that.


Sanders Caucus Eyewitness Report: Guest Post

Guest Report from a Sanders Precinct Caucus Participant

Peter Sage Introduction.    I learned that John Coster was a Sanders precinct delegate who was then chosen by his local fellow-Democrats to be a delegate at at a higher level: the Legislative District.   I asked him to submit his observations and perspective on what happened.   It was slow, which should be no surprise: it is a one-off event, run by volunteers, with high stakes, and it is subject to mischief from interlopers and saboteurs therefore requiring time to review eligibility for participation.

Hillary Clinton has done better in states where citizens simply vote.   Bernie Sanders has done better where citizens must caucus.   Bernie Sanders has elicited a very high degree of civic engagement, especially among young people but also among boomers, like our Guest Post author, who are politically and ethically mindful.

John Coster is a technology executive and investor with a 40+ year career ranging from start-ups to Fortune 100 companies.  He has worked in over 30 countries where he finds builds teams to manage very large and complex projects.  This gives him some perspective on how a complex undertaking--picking Sanders delegates--might be organized.

John Coster's Report:

John Coster
First, I’m not a political or social scientist; academic or politician; nor do I have any expertise in legal affairs or economics. My main qualification on this topic comes from having been elected student body president of Miss Weinstein’s sixth grade class in Chelmsford Massachusetts.  But I have had a life-long fascination with the history of people’s attempt to govern themselves; and I try to stay informed and engaged in our political processes. I believe context is important so thanks for bearing with me on my history. 

I cast my first vote in the 1976 presidential race between Ford and Carter.  Some may remember this was shortly after the end of Viet Nam, the Watergate scandal and long lines and high gas prices from the OPEC oil embargo. Unemployment where I lived at the time was nearly 11% and I was part of that statistic.  Ah the good old days.  

Since that time I have voted in every national, state, regional and local election, including primaries or caucuses; and referenda and initiatives – which it turns out we have a lot of here in Washington State. For many years I thought this was what everybody did. I was raised to believe that as Americans, it was our duty and privilege to participate our imperfect, but “better than any other” representative democratic process.  That belief was actually reinforced when I worked and lived in parts of the world where people do not have any political voice, and where there is real personal risk in asserting that they do. Of course I was personally immune to those realities because I could always flash my passport, jump on a plane, and return home where I was free to express pretty much whatever I wanted.

This election I decided to go a bit further, and put my hat in the ring to serve as a delegate at the local Democratic precinct caucus. This event drew far more people and was more chaotic than the one I attended in 2008. This time there were many first-timers. I was personally ambivalent but ended up being selected as the Sanders delegate at the Legislative District level. Here’s where I found it encouraging and disheartening. 

First the encouraging part. The local and regional committees were not prepared for such a big turn-out and it took several hours for over 1,200 delegates to just check in. The upside is that while waiting around, I got to speak to lots of people and observe their behavior. What I found was that people I spoke with seemed well- informed, thoughtful, articulate and the crowd seemed genuinely respectful and kind to each other – even when they disagreed. This is not something I expect to see among strangers at random public gatherings; especially when the disagreements can be so severe. There were rare exceptions of course but the uncommon civility seemed to dominate. I don’t think anyone can draw any legitimate conclusions about why this was so, but it was a unique experience that many others also noticed. I wouldn’t call it “euphoric” but it did leave me feeling somewhat hopeful in our collective humanity.  

Now the disheartening.  The entire caucus process was almost comically disorganized. It took over 8 hours for us to pick 7 delegates for the State Convention and vote on a party platform that most people didn’t seem to understand. Many of us felt the chaos had been orchestrated to exclude participation by simply wearing people down or frustrating them. Much has been written recently in the papers and on line to make us think this may actually be true. It certainly appears to be very common.  

A lot has also been written lately about the ebb and flow of the eligibility of voting rights throughout our nation’s history. Does simply having more citizen participation produce better elected leaders?  Apparently this was a point of contention between Adams, Hamilton and Franklin, so it isn’t new.   What struck me through this process, is that perhaps our form of representative government that is supposedly ‘of, by and for the people’ may be more of a myth than I had realized.  I am left wondering, given how we go about doing this, if it can ever be more than that, and if it can survive.

Monday, April 25, 2016

Chase the shiny object

Insults, Derision, Sports:  Trump keeps us watching

I am watching a Trump event in Pennsylvania.   A woman deep into the audience began shouting out something audible within the crowd but not audible to the TV audience.  Trump lights up:  a protester!

Wilkes-Barre, Pennsylvania
He congratulates the police then derides and belittles the woman.    "Oh, look at her, this woman shouting," Trump said in a mocking tone.   The crowd booed her.  Trump went on mocking her as she was escorted out.   Trump returned to his theme of collusion in the plan of Kasich and Cruz to focus their campaigns on different states.   It is collusion, Trump said with the colluders Cruz and Kasich colluding in their plan of open collusion.

The crowd was aroused then crowd broke into cheers when Trump finally used the words "Lyin' Ted".   Trump was back!  "Lyin' Ted" and then "Crooked Hillary," and the crowd roared its approval. Trump was all the way back!

Donald Trump is a masterful media manipulator.   Cable news has enormous appetite for material--exciting, watchable material--and Trump provides it in the closest thing to a white Bronco on the freeway: insults and derision.   

And today's news includes Trump weighing in on NFL football, "Leave Tom Brady alone. Leave. Tom. Brady. Alone!."   Another crowd roars

Frequent guest post author Thad Guyer commented on my post early this morning in my pointless attempt to describe a matter of serious policy, here in the midst of a gladiatorial contest.

Thad Guyer comment:

I'm suspicious over why you threw that dry policy analysis at us. What are you up to, trying to distract us from a big picture view somewhere? That can't be it, unless its some inverse distraction gambit. 

There is a piece in the NYT today asserting that the Mexican government now uses the "Trump demon" to deflect media heat from corruption and murder abetted by the government. When challenged to account for obstructing the investigation of the busloads of murdered students, the government says the reporter is tarnishing Mexico's brand just like Trump and then goes into a tirade about the Trump demon. I guess policy wonking would work, so the government official could launch into the policy details of state versus federal murder investigations, cost and manpower issues, even court jurisdiction. 

The bottom line is you are right-- we don't want policy. We want not only the big picture, we want the biggest picture possible in any given news cycle. Beyonce "Lemonade" even stole the headlines of Trump from every major media outlet yesterday. The NYT suggests we all listen to it and learn about empowerment issues from the diva. Beyonce is so biggest picture she makes Trump look like a dry policy nerd. I guess policy is relative.

Missing in Election: Policy Debate

Apparently no one cares about policy, just mood.

You can just skip this post.   I make the point that no one apparently cares about policy and then I go ahead and write about the merits of a policy requiring advisors to adopt a "fiduciary standard" versus a "suitability standard."

The rule affects your life, but you probably don't care.   And don't expect to hear about it on the campaign, because it is important but complicated and people don't have the patience for complications.

There is a difference between Hillary and Bernie, but you would barely know it from their speeches.    They attack each other now, but it is over tiny points of policy and which of them adopted the same policies earlier. (Bernie first on trade protection, Hillary first on black grievance, Bernie for $15 minimum wage, Hillary for getting to $15 minimum wage.)  But the tone is different (Bernie is revolution, Hillary is grind-it-out) and Bernie says the whole system is corrupt and must be ended while Hillary says that she can operate for progressive good in a corrupt system and will work to cleanse it.

Yes, there is a difference, but mostly of personality and background, not policy.

On the Republican side Cruz, Trump, and Rubio all have essentially the same position on immigration, but they argue over language and tone.  Trump sneers a little at Mexicans while saying he loves them, while Cruz and Rubio simply want to lock them up and deport them while dividing families, but with a bit more emphasis on rule of law, not native born American pride. 

Here too, there is a difference, but mostly of personality and background, not policy.

Progressive media denounces Wall Street slime
There is a policy debate on a matter close to my former professional life--the application of a fiduciary rule for IRA, 401k and other retirement accounts--about which I have heard exactly zero--nothing whatsoever--from any candidate.   I am confident I know who will support what, based on party team loyalty, but there will be little or no discussion of the merits.   Elizabeth Warren has pushed an idea in consumer protection, requiring financial advisors and their firms to adopt a fiduciary policy rather than a suitability policy in investments in ERISA (i.e. retirement type accounts like IRAs.)

Most news articles I have read about this take the point of view that Financial Advisors are predators intentionally fleecing clients with dishonest, self-interested recommendations.  And Elizabeth Warren has enormous respect among Democrats leads the effort for the change.   Bernie and Hillary support the bill.   Republican Cruz will oppose it.   As Greg Valliere, a global strategist for Horizon Investments put it, I think it's a pretty safe assumption that Cruz opposes the fiduciary rule and that Trump has never heard of it.”   The opposition will be based on big-picture thinking: regulations are bad, Elizabeth Warren is pro-regulation, the bill is bad.   Syllogism.

I don't doubt that some investors have investments that are less than optimal, especially when seen in hindsight, and they likely were steered toward them by advisors.   I don't doubt there are horror stories.   Perhaps a law requiring a formal fiduciary standard is on balance OK.   My own feeling, based on my own former practice, was that the existing system, in which the Advisor was required to steer clients toward investments that made sense for them and which were suitable for their situation worked perfectly well.  

Hillary's only possible position

What is the difference between suitable vs. fiduciary standard?  In my practice, not much, except that in a "suitability" standard a client could exercise some personal eccentricity, telling me they love local car dealer Lithia Motors but hated Nike because Nike Chairman Phil Knight is a Duck fan, not a Beaver fan.  So they could have account investments that were somewhat idiosyncratic.  They could own gold.  They could exercise a preference for or against oil stocks. 

They could hold cash in a Morgan Stanley branded money market fund rather than an essentially identical "outside" money market fund.   In a fiduciary account one cannot self-deal, i.e. put investors into an in-house investment, only outside investments.  Since fiduciaries are prohibited from apparent conflicts of interests, and getting paid to do a transaction is a conflict of interest, there will be a strong tendency to require people to have fee-based accounts.  Typically investors pay about 1% of total assets per year for all-inclusive supervision and transactions, therefore there is no incentive to trade or not trade, which lack of incentive is supposedly in the interest of a client.   

Some clients want gold.  Are they prudent or crazy?
Gold!  Gold!
Some clients--especially people who follow conservative media--want to have gold or silver in their portfolios, typically in amounts that reflect how thoroughly they listen to Glenn Beck or other conservative shows predicting disaster.  They might be right someday.  Or not.

The practical result is that all clients will be forced into a "reasonable" portfolio based on supposed "best practice."   Clients lose flexibility.   Clients are required to get "what is good for them" as opposed to "what the client wants."   It will generally increase costs for consumers as it shoehorns them into packages that reflect lawyers' notion of what is legally unassailable rather than investors' notion of what they want, and that is particularly true for clients who want to "buy-and-hold".

The odd irony is that a bill posited as "consumer protection" and a law sold as reigning in bad financial advisors will tend to increase costs for my former clients and will require them to have paid me rather more than I previously earned.   I was OK earning less and was OK attempting to meet clients' sometimes quirky desires, which meant more work.   This little bit of "consumer protection" to "reign in" Advisors would have made my life easier and made me more money.   What an irony.

Debating the key issues
No boring policy talk
The policy debate on whether the new "Consumer Protection" bill is made law will be essentially un-debated.  It will rise or fall on whether the  Democratic candidate wants to appear to be pro consumer versus pro Wall Street (YES!), and it will rise or fall on whether the Republican candidate wants to appear to be a compromiser with the devil in the form of Elizabeth Warren (NO!) or wants to be pro-business and anti-regulation (YES!).  

Horse race report
Will there actually be policy debate laid before the public?  No.  It is complicated and boring and hard to do in a TV panel yelling back and forth abut Trump electability.

I am retired from financial advising, but I still care a lot about my now-former clients.   The new law will not hurt them badly and my successors will work with it to minimize its costs to them.   But it will inevitably reduce their retirement investment options, by law.  How it actually affects retirement savings will be played out in the details of the law.   Given the nature of my former practice the changes will be small and manageable.   But it will neither protect them or reduce their costs.

We have 24/7 political news coverage, but there will be no time or interest in the law.   It will be debated in the most broad terms, "Consumer" versus "Wall Street."   Any candidate who attempts to look closely at the actual law and policy would be pilloried for being "soft" in defending their team, so it has not happened yet and I expect will not happen ever.   Can you picture what would happen to poor Hillary if she were to express some of the reservations I mention here?   "Pawn of Wall Street!".   Could you imagine Cruz citing some investment horror stories and saying regulations might do some good?  Headlines:  "Donors abandon Cruz."

I cite a sampler of CNN panels not simply to complain about the lack of debate but also to re-affirm my bigger point: politics in America plays out not through a debate on policy but through body language and tone and the gut impressions of voters on which candidates are strong, are representative of them, will understand and defend their interests.