Category Archive Politics

Crisis of Competence

As we mark the one year anniversary of Trump’s inauguration, the United States in the midst of a Crisis of Competence.  Congress is unable to pass budgets (or budget extensions) needed to keep the government open.  The British Parliament openly debated banning Trump from visiting one of America’s key allies.  Centuries of expertise have been purged from critical departments, from State to the EPA.  To compare the United State Federal government in 2017 to Rome burning would be a severe insult to Nero.

Worse yet, all of these crises are unforced errors.  Trump’s GOP appear allergic to expertise.  Whether this is Trump’s anti-establishment campaign promise coming to fruition or simply Trump’s complete lack of political experience impedes the executive from governing, the result is the same: fifty-two weeks of blunders, crises, and incompetence.

This long post examines the alleged successes of the Trump administration, the “to-dos” still on Trump’s agenda, and seeks an explanation of why and how this Crisis of Competence occurred.  Spoilers: Trump realigned the United States along a new axis.

Trump’s Alleged Accomplishments

Partisans tend to spin a series of debatable points as accomplishments.  Generally speaking, they are all spin.  Using the list available at the worst place on the Internet, the subreddit /r/the_donald, here is a quick digest of Trump’s alleged accomplishments

Tax Reform

Trump signed a tax reform bill in late 2017 that will impact the foundation of the American economy.  Corporations and the extremely wealthy enjoy permanent benefits, while the middle-class enjoys short-term relief but will experience higher tax rates in a few years.  Unfortunately, the working-class appears to be a net loser on the bill.

Strategically, one might question the economic strategy of a heavy fiscal when the economy is near full employment and on a seven-year run of growth.  If one digs into the details, however, the tax bill is an incredibly terrible idea — one that will actually harm the economy in the short- ad long-runs.  This is not really an accomplishment; if anything, it is a work in progress (at best) and likely a blunder-in-waiting (at worst).

War on Dreamers

Trump single-handedly dismantled the Deferred Action for Childhood Arrivals (DACA), a program to provide safe harbor for individuals brought to the United States as children without citizenship.  Doing so started a ticking time bomb, where either a dysfunctional Congress acts to save the Dreamers or (more likely), the Immigration and Customs Enforcement would engage the largest forced migration since apartheid.  This is not really an accomplishment; if anything, it is a work in progress (at best) and likely a blunder-in-waiting (at worst).

ISIL

Trump claims credit for the implosion of the Islamic state.  Most of the strategic decisions prosecuting the war were made under the Obama years — specifically the endgame siege of Mosul.  Similar to the Supreme Court nomination, others beyond Trump deserve credit.  This is not really an accomplishment; if anything, it is a negligible impact.

Appointing Justice Gorsuch to the United States Supreme Court.

Credit for this event more appropriately resides with Senate Majority Leader Mitch McConnell, who trashed two centuries of tradition by hijacking the Senate confirmation process for Obama’s court selections.  This is not really a Trump accomplishment, rather credit belongs with others.

North Korea

Trump has escalated tensions in the Pacific theater to the extent that war is a potential outcome.  With a gutted state department and public bickering with the nation’s top diplomat, Trump has literally devolved to online bullying as a form of foreign policy.  Thankfully, North Korea and other regional powers have found a way to keep the peace.  This is not really a Trump accomplishment; if anything, it is an abject policy failure.

Travel Ban

Trump attempted to impose a travel ban on several majority Muslim countries, acting on the white nationalist and xenophobic tendencies of many Trump supporters.  Granted, pretty much every court order regarding these executive order attempts have been struck down as patently unconstitutional.  More importantly, these court cases ruled that Trump’s tweets are considered official government statements — which will likely have drastic impacts on the several investigations unraveling Trump’s relationship with hostile foreign actors.  This is not really an accomplishment; if anything, it is an abject policy failure.

War on Federalism

Trump has effectively declared war sanctuary cities, with budget cuts and threats to send federal agents in to override local decision-making.  Trump’s policy opposes research that shows lower crime rates in sanctuary cities — specifically for sex and violent crimes.

Trump has also declared war on state’s rights, specifically on the legalization of marijuana.  Trump’s judicial department continues to threaten state governments with budget cuts and federal agents overruling state and local laws.

These two issues are traditionally wedge issues for social conservatives.  Unlike previous generations with a relatively even split in popular opinion, survey research consistently shows public support for both sanctuary cities and legalized marijuana.  It will be interesting to see how Trump’s policy will fare in the face of such unpopularity.  This is not really an accomplishment; if anything, it is a work in progress (at best) and likely a blunder-in-waiting (at worst).

War on the Environment

Trump approved the Keystone Pipeline, violating several treaties with Native American groups and potentially violating hundreds of families’ property rights.  Multiple alternatives to the Keystone Pipeline were already afoot – many of them with less negative externalities than the existing plan.  This is not really an accomplishment; if anything, it is a negligible impact.

War on neoliberal trade

Trump has disrupted several foreign trade deals, including the North Atlantic Free Trade Agreement and the Trans-Pacific Partnership.  TPP was already dead in the Senate, so claiming any impact is laughable.  NAFTA renegotiation, however, is a high-stakes game, where both Canada and Mexico seem poised to profit more from a new agreement.  As leaks come from the ongoing negotiations, it appears as though the United States might lose potential profitability due to new demands from our neighbors.  This is not really an accomplishment; if anything, it is a work in progress (at best) and likely a blunder-in-waiting (at worst).

Border Agents

Trump issued an executive order to increase the number of border patrol agents in February.  That said, the number of agents has actually dropped, as the new hires can not keep up with the labor churn within the department.  This is not really an accomplishment; if anything, it is a negligible impact.

Revitalizing the Coal Industry

Trump has falsely claimed that coal “is back” due to his anti-environmental regulation agenda.  In reality, coal industry jobs are on par with the last years of the Obama administration, despite Trump mortgaging the environment’s future for decades to come.  This is not really an accomplishment; if anything, it is a negligible impact.

Jobs, jobs, jobs

Although the Dow Jones Industrial Average continues to increase (generally following the same pattern immediately prior to a market correction), job growth under Trump is actually down compared to year-over-year growth under Obama.  Trump tends to cite specific instances, like a Carrier plant in Indiana, where bribes and subsidies prevent companies from outsourcing jobs.  Unfortunately, nearly all of these examples end in the same story: after the press goes away, the jobs get outsourced anyway — wasting taxpayer money on those bribes and subsidies.  This is not really an accomplishment; if anything, it is a negligible impact.

NATO

Trump held up the North Atlantic Treaty Organization, by going back on American commitments for military and economic resources for the alliance.  This decision has strained relations with several of America’s key allies while fanning the flames of Trump-Russia conspiracy theories.  This is not really an accomplishment; if anything, it is a foreign policy blunder.

War on Women

Trump has issued a handful of executive orders to limit access to abortion.  These executive orders are likely going to be struck down due to Roe v. Wade and other case law.  Many of these executive orders are just as sloppy at the Muslim ban/travel bans.  This is not really an accomplishment; if anything, it is a work in progress (at best) and likely a blunder-in-waiting (at worst).

Trump’s lack of accomplishments

Mexican-Funded, Big Beautiful Wall

Trump promised to build a “great wall” to prevent illegal immigration and impede drug cartels moving drugs from Mexico.  Trump’s plan was to get Mexico to pay for the wall.  This plan is essentially dead, with multiple advisers suggesting that Trump “discovered” that a wall will not work and Mexico’s government unsurprisingly declining to fund the project.  This political plank is dead in the water.  (Thank God.)

Vigilante Justice

Trump roughly endorsed vigilante justice — especially when conducted by white males — multiple times on the campaign trail.  This message has diminished, but has bubbled up during social crises like the Charlottesville protests where a neoNazi killed anti-neoNazi protestors.  Trump effectively defended the neoNazi, attempting to place blame for the violence on “both sides.”   Besides the occasional gaffe, however, a pro-vigilante justice policy has not yet materialized.  This political plank is dead in the water.  (Thank God.)

Veterans

On the campaign trail, Trump routinely demanded better care for veterans.  The record is surprisingly mixed.  While various reforms aim to privatize many VA services, several cases of the VA service providers sending homeless veterans into the cold have appeared in the headlines.  These cases appear to be happening more often and more egregiously by the month.  This is not really an accomplishment; if anything, it is a work in progress (at best) and likely a blunder-in-waiting (at worst).

Trump’s actual impact

Racism

The most unfortunate outcome of Trump’s tenure is the reconstitution of public white nationalism in the United States.  Commentators on Fox News routinely defend neoNazis on the air while the rest of the far-right (and Russian Intelligence-supported) media echo racist stories to wedge unassuming conservative viewers away from minorities.  The resulting culture has brought white nationalism back into the public eye — and worse yet, Trump has legitimized it time and time again.  This trend is extremely dangerous because it undermines the legitimacy of the republic.

Russia?

One can not review the Trump administration without noting the ongoing investigation into the 2016 election cycle, particularly the impact of alleged coordination between the Russian government and Trump 2016 campaign.  Multiple campaign officials have plead guilty to various conspiracy charges, and the sentences are lenient enough to speculate that bargains for future testimony occurred.

One legal question that has emerged is who has jurisdiction over Trump if Trump illegally coordinated with a hostile foreign actor to impact an election.  This discussion is indicative of an incredibly sad moment in national integrity; this trend is extremely dangerous because it undermines the legitimacy of the republic.

Loss of Institutions

Trump has consistently attacked institutions that hold power to check the Oval Office.  From the courts, to Congress, to the media, to foreign powers, to existing law, Trump has sought to undermine opponents.  This scorched earth approach has eroded faith in critical institutions, like the free press.  This trend is extremely dangerous because it undermines the legitimacy of the republic.

Crisis of Competence – nobody knows anything

In summary, Trump is claiming successes that are either not his, not complete, or complete disasters.  All the while, dangerous trends continue to develop — each seemingly aided by Trump’s decisions.  One might ask — how did this happen?

Postmodernism on Parade

Trump is ultimate product of a postmodernism.

Extremely simplified, postmodernism is a philosophy that rejects reason and reality.  Postmodernism is generally a response to a late nineteenth, early twentieth century philosophy modernism.  Modernism highlighted the ability for humans to create and reshape their environment for social progress through reason, science, and technology.  Modernism generally suggests that facts exists, and if humans can understand enough relationships among facts, then they can reason through and solve problems.  Postmodern takes an extremely skeptical approach, highlighting relativism rather than objective reality.

“Alternate Facts” and the rejection of facts are the penultimate articulation of the postmodern movement.  While Trump is extremely unlikely to have read many if any postmodern works, his attacks on institutions are patented postmodern critiques of reason and reality.  By deconstructing the known and the unknown into fragments of fact and alternate fact, Trump and his cronies have created an environment where the debate is over reality.

What is real and what is unreal is today’s debate.  Gone are the days of good versus better policy.  Gone are the days of liberal versus conservative.  Gone are the days of ethical versus unethical.  Today, we have a world of fact versus alternate fact.

Kakistocracy, not Technocracy

Trump’s administration not only rejects objective fact and reality, the Trump administration also rejects reason.  This rejection has led to a widespread purge of experts throughout the government, from lifelong diplomats with critical connections in various foreign powers to elite scientists who continue to push the cutting edge of human knowledge.

The resulting government is devoid of expertise, leaving incompetence to run amok.  In Trump’s postmodern world, there is no way to identify (much less implement) expertise.  The highly unqualified govern critical posts.  The guy who fought the EPA runs the EPA.  The guy who fought the budget manages the budget.  The gal who fought public education runs the department of education.  Even the competent are miscast.

Previously, the US Government functioned like a fairly well-oiled machine on the backs of some of the best minds trained at the best universities refined by the best institutions implementing the best practices.  The technocracy built by Clinton, Bush, and Obama has been systematically destroyed and replaced by Trump’s kakistocracy.

Trump realigned the United States in the 2016 election cycle.  Instead of tilting the liberal-conservative axis, Trump realigned along a new one: technocratic/modern verses kakistocratic/postmodern.  Considering the durability and philosophical hegemony postmodernism has today, it is highly likely that Trump’s realignment will be extremely durable.

American Carnage

Six months into Trump’s run as President, it is clear that the United States is facing an extremely difficult, exceedingly complex set of problems without capably leadership.  Trump described this “American Carnage” in his inauguration speech.  After the jump, there are some quick solutions to many of these challenges that continue to worsen.

Russia

Russia meddled in the 2016 election, according to multiple intelligence agencies.  Members of the Trump campaign have released documents that show the intent to and execution of efforts to coordinate with the Russian government.

There are three key problems with this incident: (1) Russia attacked the United States, (2) Russia found some useful idiots to help/commit treason, and (3) Trump appears to be obstructing the investigation into this incident.

The latter two issues are political and judicial questions (e.g., impeachment and incarceration) that are unlikely to find resolution if Trump controls the levers within the Department of Justice and Republicans in Congress remain loyal to Trump.  After 2018 and 2020 — assuming no interference from Russia — then political checks will be in place.  This process assumes no interference from Russia, which is the real problem.

The solution to cyber conflict is to change our defensive stance into an offensive stance.  The United States needs to return to a Cold War, realpolitik stance for cyber conflict.   The solution is relatively straightforward: the United States needs to develop a potent arsenal of cyber attacks in order to deter future Russian attacks and the United States needs to develop a weapon to stop cyber attacks as they leave Russia — a cyber quarantine — not when they arrive in the United States.

In other words, we need to be able to flip the switch on Boris and Natasha’s grandma and cut off their attacks before they come to our shores.  As a result, the United States should increase funds for STEM education and shift immigration policy to  recruiting the best and brightest minds from around the world to the United States.

Immigration

Political hacks continue to fan xenophobic flames by using racist dog whistles to build support for anti-immigration policies.  These policies are terribly misguided.Instead of looking at immigration as a problem, the United States needs to view immigration as an opportunity.  To secure a better future, the United States should actively recruit the best and brightest from other countries.

The far-right solution often involves fool-hearty vigilante mobs protecting the border and unfunded mandates and half-baked federal directives for local police that undermine their ability to protect their communities.  Although the meme developed far-right media might suggest that immigration leads to many social ills, data suggests that areas that receive immigrants report stronger economic growth and less crime.

Race 

Racism is unfortunately alive and well in the United States.  Despite increased efforts for racial sensitivity training and video documentation procedures, white-on-nonwhite police brutalities continue to occur on an alarming basis.  While widely distributed videos show white police officers unloading entire clips of bullets into unarmed black victims, images of white police officers calmly negotiating with heavily armed, agitated white nationalists.  The stark difference demands continued efforts to reform the police — including procedures to reeducate or remove potential problems in the police force.

Arguably worse than the brutal assaults that occur, when video clearly shows a white police officer killing an unarmed black man in an automobile — with his child in the backseat — juries refuse to convict the police officer.  The lack of support from white society for our minority peers is unacceptable.  These cases continue the trend where juries often let white defendants off on light punishments while providing stricter sentences for minority groups.

Reforms to undermine the clandestine segregation programs – from municipal fragmentation to real estate anti-steering regulation enforcement – need to take a high priority to stem the racism that leads to horrific outcomes caused by bad apples in the police force and society’s jury pool.

Corrections

The United States has the largest population of prisoners in the world.  A niche industry around criminal punishment has grown rapidly over the last two decades on a simple scheme: states pay a private prison to incarcerate convicted criminals.  These prisons collect huge sums of cash for often substandard conditions.  As states continue to face budget challenges, incarceration costs continue to balloon.  At some point in the near future, the bubble will burst as state leaders will conclude that the “prison industrial complex” drains the public budget.

The United States needs to consider the jail-early-jail-often policy from the past two decades.  Alternative punishments might be more appropriate than going to jail, especially if the programs reduce the likelihood of committing crimes in the future.  For example, for drug-related crimes, policies that reward sobriety with reduced sentences (assuming continued sobriety) can save the system money to be used for crime prevention.

Drugs and Mental Health

Mental health and drug use are some of the largest challenges facing the criminal justice and corrections systems in the United States.  Prison systems are often the largest mental health providers in the nation — despite the personnel in prisons often having little mental health training.

It is significantly less expensive and significantly more humane to provide mental health intervention outside of the department of corrections.  Whether the mental health issue is hereditary or garnered through drug use as an addiction, the time to intervene is before crime occurs.  (One should note that mental health does not necessarily correlate with crime — especially if you drop addiction from the equation.)

The United States continues to face a drug epidemic; this decade’s iteration includes heroin, which appears to disproportionately impact lower- and middle-income, rural and suburban whites.  It is abundantly clear that the “War on Drugs” did not work, and that continuing to go “on offense” will likely not succeed in stopping the addiction carnage.

In many cases, addicts start using drugs as an escape mechanism caused by personal, social, or economic issues.  Targeting each of these issues — from public investments in local culture and education to reviving the local economy — can help stem the demand.  Aggressive anti-drug measures — from drug education (not propaganda, actual education) to investments in rehabilitation programs — can help slow the demand-side of the economics behind the drug trade.  Finally, producing a strong mental health safety net for those in recovery can help formerly using-addict stay on the wagon.

Healthcare

Trump is on record for wanting to let the Affordable Care Act (Obamacare) fail — even if it means millions go without access to health insurance, which could lead to Americans dying.

ACA is a flawed piece of legislation.  Despite many flaws, the ACA has provided viable access to health insurance to millions of Americans.  Trump and Republicans promised to repeal and replace the bill, yet the party appears completely incapable of garnering support for either of these steps.

Several options are immediately available to improve the ACA.  (1) Returning subsidies to original levels would allow the bill to counter increases in insurance rates.  (That part of the bill worked until the GOP Congress cut funds in an attempt to starve the bill.)  (2) Establishing and adequately funding new healthcare cooperatives as they launch will provide more competition in rural areas.  (3) Enabling group plans among individuals will allow organizations to leverage market power for better prices when negotiating deals.  In other words, the law could let folks form groups for more market share and therefore better deals.  (4) Expanding funding for Medicare, Medicaid, and the VA will buttress the private market while providing help for some of the nation’s highest need populations.

The Economy

The American economy continues to report good “top-line” numbers, however many of those numbers are relatively hollow.  The American “Main Street” economy continues to suffer from the hangover left by the Great Recession.  Reforms written by ex-pats from large banks reinforced the quadropoly in the finance industry, while other large industries maintain regional monopolies (telecommunications, among others).

Trump’s current plans include attempts to revive the coal industry, which directly impacts roughly 50,000 full-time jobs.  Even with the aggressive multipliers, the entire coal industry likely impacts less people than a single corporation like Ford.

The United States should look forward to building the next wave of Fortune 500 companies by investing locally.  Roughly twenty counties in the United States account for the lion’s share of economic growth.  These cities develop and implement strategies attract high value-added workers, foster communities where innovation happens naturally, and build the businesses of tomorrow.  For the nation to achieve better and more equitable economic growth, the United States needs to partner with local government to spawn more of these agglomeration economies.  Stopping the brain drain, fostering and capitalizing on a dynamic workforce is the route to prosperity — not sending a canary back into the coal mine.

American Leadership

In October, I suggested that Trump was a threat to contemporary American values.  Six months in, it appears that Trump is neither in line with those values nor able to implement his authoritarian populist principles.  The only result is continued American carnage.  That carnage appears to be spreading.

Trump’s behavior regarding critical allies — from the G20 to NATO — have severely injured long-term relationships.  The insults and embarrassment from Trump incidents have undermined the United States’ capability to lead the world.  As a result, once regional crises (e.g. North Korea intercontinental missile launches) become unanswered international incidents.

I strongly believe that with the correct leadership, the United States can be the country of tomorrow.  For the world’s sake, the United States needs to reassert itself as a leader — whether it is checking the Russian cyberattacks worldwide or developing a plan to limit the carnage caused by climate change.  Unfortunately, under Trump, American Carnage is becoming Global Carnage all too quickly.

Running Government like a Successful Business

If the United States were run like a successful business, then the political, policy, and public sector strategies would be strikingly different.  Politicians seeking to dismantle the government perpetuate a myth based on an oversimplified version of economics — which is leading to widespread economic pain.  Instead of racing to the bottom by slashing taxes and costs, the government would make strategic investments in its work force, infrastructure, and research for innovations.

“Business” Practices in Government

Since the turn of the twentieth century, politicians have echoed the calls of “reformers” to “run government like a business.”  This demand seems to have started as a response to political machines that functioned on graft, payoffs, and other transactions widely seen as corrupt.  Running government like a business meant eliminating the corruption through a business-lite structure and civil service, a series of laws to make sure state employees were qualified to serve rather than a political hack.  To this day, many government jobs require a competency exam.  Reformers even shaped how local governments function — as the majority of American cities function like a corporation under the council-manager structure.

Tax revolts during the 1970s led to a revival in these reform efforts.  Applying an extremely oversimplified business model, “new fiscal populists” started seeing any expansion of government as inherently bad.  Raising revenue (taxes) is seen as a terrible sin, to the extent that candidates swear oaths to never even consider raising tax rates.  Some states have imposed “fiscal straitjackets” onto themselves, creating a system of rules that do not allow government to grow.

Most new fiscal populists claim that economics “proves” that taxes kill businesses.  Due to a deadweight loss created by taxes and (alleged) government mismanagement of resources, new fiscal populists conclude that tax cuts will grow the economy.  Some even argue that tax cuts will increase tax revenues!  (This is theoretically possible, but evidence suggests that this outcome happens extremely rarely.)

When applied to a larger scale, state and federal politicians continue to focus on where to cut budgets.  This mindset sometimes leads to laughable, tragic decisions.  For example, when Kansas faced budget shortfalls during the Great Recession, the state government drastically cut taxes hoping to spur growth.  Eliminating various taxes may have had some positive impact on the economy, but it destroyed the state budget.  Officials cut public services to cover near-billion dollar shortfalls year after year.  Young Kansans started an exodus, creating a brain drain.  Businesses left Kansas — giving up lower taxes — likely following those skilled workers.

What Went Wrong?  Austerity.

Kansas’ story can be found in multiple states and cities across the United States and many nations around the world.  Leaders often associate fiscal austerity (only using budget cuts to balance budgets) with good business practice.  This assumption could not be further from the truth.

Austerity programs remove critical support for those in most need – the ill, the elderly, and those ill-equipped for a changing marketplace.  The result of these policies is not a Fairy Tale economic revival, it is the economic pain that is fueling the attack on neoliberalism as we know it.

Successful businesses make critical investments – in their workforce, their infrastructure, critical parts of their business, and their research to innovate the next generation of products.  Austerity reduces investments on some or all of these fronts.

Evidence

Below, I analyze the high points of the Fortune 10 companies’ business models. Here are the highlights:

Fortune 10 corporations’ business model:

  1. Walmart
    Excellent supply chain, transportation and retail infrastructure
    Critical partnerships with key suppliers for very diverse offering of white-label products
    Lead on price, wins on assortment (see Dixit Stiglitz, constant elasticity of substitution)
    Passes the cost for worker benefits (to the state)
    Monopolizes and exploits local markets
    Large amount of working capital to make large investments at critical moments
  2. Exxon Mobil
    Excellent supply chain, transportation and value-add infrastructure
    Vertical integration of petroleum-chemical industry in all phases of production
    Exploration and exploitation of natural resources
    International footprint of marketplaces, market segments
    Large amount of working capital to make large investments at critical moments
  3. Apple
    Strong supply chain, excellent access to exclusively controlled proprietary platform
    Top in class branding
    Large research and development budget to maintain branding
    Vertical integration of production – specifically high margin software products
    Expensive barriers to exit allows for exploitation of customer base
    Large amount of working capital to make large investments at critical moments
  4. Berkshire Hathaway
    Excellent fiscal model that leverages/exploits insurance “float” to purchase successful corporations
    Unrivaled, multifaceted conglomerate with a balanced portfolio
    Reinvests all earnings into future investments in the portfolio
    Large amount of working capital to make large investments at critical moments
  5. McKesson
    Excellent supply chain, infrastructure, branding, and business-to-business sales
    Critical partnerships with key suppliers to drive market share
    Very diverse offering of white-label products (generic drugs)
    Large amount of cash on hand/working capital to make large investments at critical moments
  6. UnitedHealth
    Diverse product line of insurance and risk-mitigation products
    Diverse market segments, from B2C, B2B, and B2G
    Critical partnerships with key suppliers
    Large amount of cash on hand/working capital
  7. CVS Health
    Excellent supply chain that supports an extended network of retail pharmacies
    Aggressive acquisition and rebranding of multiple pharmacy chains
    Exploits corporate synergy with related services, including a cottage pharmacy insurance and clinic chain
    Large amount of cash on hand/working capital to support acquisitions and supply chain for high-margin, low-volume products
  8. General Motors
    Excellent supply chain that supports auto manufacturing across five continents
    International footprint of marketplaces and market segments with national-level branding
    Exploits corporate synergy with related services, including auto leasing
    Large research and development budget to innovate new auto features; often operated as independent subsidiaries
  9. Ford Motor
    Excellent supply chain that supports auto manufacturing across five continents
    International footprint of marketplaces and market segments
    Standardization across models to streamline innovation and reduce production costs
    Exploits corporate synergy with related services, including auto leasing
  10. AT&T
    Excellent supply chain that supports telecommunications across multiple platforms
    Vertical integration of telecommunications across multiple platforms
    Exploits corporate synergy with related services, including attach products and combination packages
    Strong use of loss leader strategy on partner-fulfilled hardware for high-margin subscription services

To summarize the observations above, it looks like the best practices are:

  • Large amounts of cash/working capital to make investments
  • Established investments and maintenance of critical business infrastructure
  • Diverse portfolios, often with a mix of large-quantity-low-margin products and high-margin products
  • Synergy where possible

It general, it looks like the nation’s most successful companies follow a relatively similar pattern: leverage revenue opportunities to make investments today to secure productivity tomorrow.  Even Ford — an auto manufacturer which was hammered by the Great Recession — looked to innovate (standardized production across models and brands) in the midst of budget shortfalls.  Ford shut down parts of the company that were not profitable in the short run, but Ford kept long-term prospects in place, because today’s decisions are how businesses succeed tomorrow.

Back to Theory

Macroeconomics teaches two starkly different models of analysis.  In the short run, supply and demand are extremely sensitive to price, taxes, and tastes.  Short run production depends on whether central banks manipulate the price of money through the bond market, whether governments manipulate currency to gain competitive advantage through arbitrage, or whether governments tax or subsidize businesses.

In the long run, none of that really matters.  Labor, land, capital, and entrepreneurship (e.g., innovation) replace prices, taxes and taste.  Growth in each of these categories is in the public interest. Investments in labor (education, health), investments in land (infrastructure), investments in capital (infrastructure, unfinished goods), and investments in entrepreneurship (innovation, research grants) are often public goods exposed to the free rider problem.

Not making the investments necessary for future economic growth is a market failure, just like every other free rider problem.

Luckily, the state has intervened in many of these cases.  American government subsidy in education has created arguable the most skilled labor force in history.  American government subsidy in transportation infrastructure (planes, trains, and automobile highways) has solved the logistical problems of linking one of the world’s geographically largest nations into a single economy.  American government seed investments, small business subsidies, and local government programs have helped prime the pump with capital investments.  Finally, American government investments in research have created trillions in revenue potential for entrepreneurs to monetize clever go-to-market strategies for public innovations.

Running the Country Like a Successful Business

According to the United States Constitution, the government is in place to (in part) promote the general welfare.  To that end, the United States government has historically made critical investments to grow the economy.  Large investments like the Louisiana Purchase, land grants and in-kind subsidies for the transcontinental railroads, electrification projects, the creation of (at one time) world-class public education, and the Internet have all instigated decades of strong growth.

Since the Great Recession leadership has shifted towards an austerity-based approach. This is precisely the incorrect approach.  Instead of cutting taxes for outbound corporations, Kansas should have invested in its people, limiting the brain drain through investments aimed at young skilled professionals, its infrastructure, and capturing synergy from economic opportunities based on existing business.  (And the problem is not limited to Kansas.  The same could be said for Illinois, Oklahoma, Greece, or increasingly the United States federal government.)

Great Recession Austerity policies led massive profits for large businesses (and their stockholders on Wall Street), but Main Street never fully recovered which left families rubbing pennies together to make ends meet.  In a cruel irony, the reformers’ push to run government like a business has created a new, plutocratic form of corruption.  Twenty-first century corruption occurs when business leaders manipulate voters’ and politicians’ misunderstanding of economics to implement policies that help business leaders exploit voters and politicians.

The solution to the economic woes is not more of the same failed austerity programs; it is to invest in the United States like a successful business.

The United States needs to invest in its work force.  Primary, secondary, vocational, technical, and higher education are all critical elements to preparing new workers for the economy.  Retraining programs are also necessary to help those workers displaced by automation and innovation.

The United States needs to invest in its infrastructure.  Our railroads, roads, and bridges crumble.  Our power grid is aging and relies on archaic fuels.  Our bandaid, patch-fix approach to answer increasing demands on a communications network is unsustainable.  Building this infrastructure will lay the foundation for a prosperous twenty-first century America while stimulating the economy in the short run.

The United States needs to invest in its ability to innovate.  Research grants to build new solutions to lingering problems may not always pan out, but when they do quality of life always improves.

These investments will cost money.  They will require taxes to go up.  But the investment is worth it.  The United States of America has the opportunity to make the twenty-first century the American century.

The decision is simple: run government like a successful business and invest in prosperity for years to come, or continue to run the country into the ground.

 

 

The Obama Legacy

As we prepare for the nation’s greatest tradition (the peaceful transition of power), it is time to take stock of where we are, where we have been, and where are we going.  A quick glance backward towards the Obama years reveals a mixed record.  TL;DR: so much potential wasted.

I doubt that history will look kindly towards Obama’s tenure.  The problems that he inherited were (at best) only partially solved while new problems at the end of his term appear able to critically wound the republic.

The Economy: C

Obama inherited one of the deepest recessions in American history.  Bush had approved TARP, a once-in-a-lifetime bill to save the banking industry.  This stop-gap gave Obama time to implement a strategy to revive the economy.  Obama’s efforts met mixed results.  Based on top-line numbers (GDP growth, unemployment), Obama’s record is stellar.  Based on a deeper dive into the data (income inequality, full-time employment), Obama’s record is far more troublesome.

Policies

Obama’s economic policies feature three main pushes: American Reinvestment Act, Dodd-Frank banking reform, and continued free trade.  The Reinvestment Act echoed the New Deal strategy of building public works.  Allocations made in 2009 and 2010 continued through the early 2010s, finally meeting Obama’s goal of less-than-eight-percent unemployment in four years.  (Granted, it took four years to get there.)  There are no landmark infrastructure improvements or bands that serve as a symbol of the Reinvestment Act’s success, which likely hampers its legacy.  That said, the strategy (combined with free-money monetary policy from the Federal Reserve) did help get the economy off of its back.

After questionable lending practices (many enabled by policies under the Clinton and Bush administrations) led to the bubble and meltdown of the housing financial markets, Obama directed Congress to develop new regulations on the financial industry.  Dodd-Frank is the main result of this initiative.  The law was heavily influenced by leaders in the banking industry, and appears to have added new agencies to regulate financial and similar institutions; however, these organizations have very little authority and punitive power to actually incite changes to offenses by these groups.

Obama continued the multi-decade tradition of pursuing free trade agreements with allies around the world.  The largest measure (still to be ratified) is the Trans-Pacific Partnership, a free-trade deal with Japan, Australia, Singapore, and a handful of other nations.

Economic Response

Overall, the economy has a widening gap between the very wealthy economy represented by Wall Street and the typical American’s economy represented by Main Street.  Wall Street has prospered, while Main Street has generally stagnated.

The United States’ GDP has increased by roughly $2,000,000,000,000 under Obama, roughly a 1.6% growth rate.  Wall Street has seen much better improvement, with the Dow Jones Industrial Average growing nearly 150% in the last eight years (from roughly 8000 in January 2009 to just shy of 20000 today).  Unemployment has improved as well, falling from 7.8% when Obama took office to 4.9% today.  Notably, the unemployment averaged in the mid-9% range during Obama’s first term and the mid-6% range in his second term.

Unemployment numbers are a bit tumultuous, especially as definition seems less appropriate in the current economy.  First, the work force is changing rapidly as the Baby Boomers leave the marketplace.  This exodus might mask discouraged workers – those who normally would work but have given up hope – leaving the market as well.  Increased levels of disability and long-term unemployment in rural areas with little economic growth indicate that both Baby Boomers and discouraged workers are leaving the market — which skews the unemployment rate downward.

Second, unemployment rates only reflect those without work.  Part-time workers who seek full-time employment are counted as fully employed.  Digging deeper into the data reveals a large amount of growth part-time employment.  This shift indicates an alarming trend that people are underemployed and are working with less pay and fewer benefits (if any) — placing additional stress on the Main Street economy.

Finally, the expansion of “experience pay” internships (the new first job out of college), coding of independent contractors (7% of workers), and the rise of the gig economy (4% of workers) confuses this metric all together.  Young people now often face a difficult job: take an internship at a potentially lucrative career path for no pay for “experience” and “networking” or try their hand at a less lucrative career path. Once hired, many are classified as “independent contractors” – a regulatory loophole that allows companies not to extend benefits to their employees.  Companies like Uber, Fiver, AirBNB and others provide alternative streams of income for Americans — however, whether or not someone who tries to make a living off of these gigs classifies as employment remains debated.  The inconsistent pay, lack of benefits, and additional stress on Main Street is not debatable.

Final Grade: C

All together, the economic data shows a mixed response for the Obama economy.  For the wealthy with investments in the stock market or those with stable jobs in thriving markets, the Obama economy has been great.  For the less wealthy who rely on their wages to make ends meet or millennials entering the workforce, the economic picture is bleak.

Domestic Politics

The United States’ internal politics is far more nasty than it has been at any other point in my life.  The perpetual temper tantrum by the Republican party and the Obama administration’s tepid response has led to a dysfunctional politics.  The resulting political slapfight has been six years of inaction, despite increased racial tensions, gun violence, a shrinking middle class, a struggling working class, and political dischord.

Obama swept into office in 2009 with a filibuster proof majority in the House and Senate.  Obama’s greatest legislative achievement (and, is perhaps one of three notable laws alongside Dodd-Frank and the Reinvestment Act discussed above) is the Affordable Healthcare Act.  Obama passed the torch to Congressional leadership (and health insurance companies) to write the law – a critical mistake.  Over the next year, Congress produced a nearly 2,000 page piece of legislative sausage that included some of Obama’s requests and a bunch of legal junk.  After a series of court cases that confirmed it’s constitutionality, the law appears to have expanded health insurance coverage to a few million people.  Unfortunately, the healthcare plans offered are often only for catastrophic cases with incomplete access to the highest levels of medicine.  Some parts of the law are positives (no denial of preexisting conditions and allowing family plans to cover young adults working those no-benefit internships), yet the law is hardly a widespread success.

The law passed with much controversy which fueled the 2010 TEA Party electoral success.  Republicans seized control of Congress and subsequently checked Obama at nearly every turn.  Republicans tilted towards the far-right under Obama, and he was unable to coordinate with center-right leadership to curtail the fringe elements gaining a foothold.  As a result, Obama was reduced to governing through executive actions (which can be reversed) on key issues like homosexuality in the military, immigration policy, and marriage.

With Congress paralyzed and the far-right inflamed, old issues came back onto the agenda.  Mass shootings became more frequent.  Crimes clearly influenced by racism, sexism, and religious intolerance become more frequent.  Cyber attacks increased in intensity and became more frequent.  Yet the government was unable to act.  Republicans blamed Obama, and Obama blamed Republicans.

Final Grade: D

Yes, Obama faced the headwinds of a belligerent Congress for six years.  However, with two years of unchecked power and legislative mistakes that led to the rise of that belligerent policy lie at Obama’s feet.  As a result, Obama’s decisions deserve a significant share of the blame for the domestic paralysis for the past several years.

Foreign Policy

In 2008, my greatest concern with Barack Obama was his foreign policy strategy.  It appears that my concerns were justified.  Obama’s run as President had a couple of successes, however America’s position on the global stage is significantly worse than it was eight years ago.

Obama’s best moment on the foreign stage was likely when he and Secretary Clinton barged in on a meeting to force the issue of climate change.  This confrontation led to a series of trade and regulation agreements, along with a fairly productive dialogue with East Asian counterparts.  From there, the general goodwill Obama enjoyed from foreign populations is remarkable – which is particularly highlighted when compared to his two neighbors in history.  Obama also thawed relations with Cuba and Iran – both were once bitter rivals and are now on a path to a improved relations.

Obama’s most celebrated moment was the extrajudicial killing of Osama bin Laden.  This extremely risky mission is arguably a war crime (bin Laden received no trial, assassinations are generally frowned upon in international law), and if things had gone wrong we could have ended up in an armed conflict with Pakistan — a nuclear power.  Despite those risks, the mission’s success is widely seen as a positive.

The rest of Obama’s foreign policy — especially the war on terror — is a mess.  Instead of pressing American influence in the region, Obama stepped backward and asserted that regional powers needed to pick up the slack.  This experiment has been a dismal failure.  China is increasingly belligerent in East Asia while the Middle East is literally on fire.

Several opportunities to support calls for democratization in the region went untouched, from the Neda protests in Iran to the Arab Spring in Egypt, Syria, and Libya, among many other examples.  One note that will likely be missed is the potential contagion effect of liberal and democratic values in illiberal and undemocratic regions.  The influence of republics like Israel and post-regime change Iraq may have destabilized authoritarian governments enough for democracy to break through.  Without American assistance, these efforts were damned to failure, and parts of the region have been hell on earth for years.

The American withdrawal from Iraq created a power vacuum and opening for al-Qaeda Iraq (now the Islamic State) to take territory.  The resulting power has systematically raped and pillaged along the Iraqi and Syrian countryside, while gaining proficiency in social media to attract homegrown terrorists.  Their influence has also hijacked a potentially good moment throughout the region: the Arab Spring.

Most of the Arab Spring movements were cut off at the knees by strong government responses.  Many of these governments are difficult partners in the region and impose wildly different policies than American preferences.  The largest example is the atrocities that have occurred in Syria.  The Syrian Civil War saw the utter destruction of Aleppo, a major cultural center in the region.  Obama has attempted to tip the fight against the Islamic State with targeted drone attacks against ISIL operatives.  This policy (which is potentially a violation of the Geneva Convention) has soiled what goodwill Obama had garnered throughout the Middle East.

Despite bipartisan calls for intervention, Obama hesitated, drew a red line, ignored violation of that red line, and sat on the sidelines as the Russians and ISIL increased strength in the region.  The result was an emboldened Russia – one that has forcibly annexed Crimea from Ukraine with minimal response from NATO or the United States.

Yet the largest failure of the Obama administration is not protecting the sanctity of American elections from the Russian government.  The sacred cow of American politics is now widely questioned.  Obama suggested that he had told Russia’s leadership – including Putin – to “cut it out” regarding their meddling in American elections.  Clearly that verbal warning was ignored, and the sanctity of the American election system is in doubt.

Final Grade: D-

Yes, Obama faced an incredibly complex and difficult world stage as President.  His inexperience showed.  It often appears that Obama’s inexperience led to hesitation, and that hesitation led to the correct, time-sensitive policies not being available by the time POTUS made a decision.

Overall: D+

In 2009, many looked to Barack Obama as a President with potential.  Unfortunately, hesitation and inexperience led to a series of mistakes that have made the American interest worse than it was eight years ago.  Worse yet, those mistakes enabled someone who appears even less equipped for the office in power.

2016 Election Prediction Results

In January, I made a series of predictions about the 2016 election.  Some where practically spot on, while others were a little bit off.  Here is a quick report card.

Seat by Seat: A

Unlike nearly every major media source (including both the “mainstream” and “alt-right” media), my 2016 Presidential election map is mighty close to accurate.  I missed Wisconsin (like everyone), North Carolina, and Arizona.  Although I missed the margin of victory, I correctly called the end result of 94% of the electoral contests.

Of the 34 settled Senate elections, my forecast accurately called 33… assuming that Louisiana’s runoff to finish will turn red as widely expected.  Only Feingold’s race in Wisconsin was a miss.  My batting average here is north of 97%.These estimates are better than most projections found online.  My seven year accuracy is now north of 90%.

As far as projecting the House of Representatives, I once again underestimated the Republican gains.  The Trump tidal wave appears to have delivered 10 more Republican seats than I projected.  My annual accuracy is exactly +/- 6 seats.

Republican Poorer White Strategy: A+

In January, I predicted that the Republican Party would forego their Romney post mortem inspired, pro-minority strategy in lieu of doubling down on poorer, less educated white voters.  Donald Trump’s campaign followed this exact strategy.

2016 Realignment: A+

In January, I also predicted that the election cycle would feature an electoral realignment.  With the political flip of Midwestern states from sapphire blue to Trump red — along with the shifting sands in Arizona and Texas — the United States’ political map is fundamentally different than it has ever been.

The Republican Party appears to have transitioned into a white nationalist party — with electoral majorities in state governments, Congress, and the Electoral College; the Democratic Party appears to be a disjointed “everyone else” party with no clear leader for the next several years.

War Hawks Against ISIS: A

I expected ISIL to be a featured part of both parties’ platform.  Both Clinton and Trump highlighted destroying ISIL as a key policy goal, and both sides appeared more hawkish than Barack Obama.  The series of distractions throughout the election cycle muddled these positions.

No Change to the Status Quo: I

Despite all of these expectations, I projected that there would be no major changes to the Clinton-Bush-Obama neoliberal policy system.  This accuracy of this prediction is still yet to be seen.  Based on Trump’s rhetoric, it appears to be way off.  Time will tell.

Overall: A, with a critical I to be determined

Senate accuracy: 92.1% accuracy on average (128/139)

  • 2016: 97.1% (33/34)
  • 2014: 94.3% (33/35)
  • 2012: 87.8% (29/33)
  • 2010: 89.2% (33/37)

House accuracy: within 6 seats on average

  • 2016: -10 Republicans
  • 2014: -10 Republicans
  • 2012: +4 Republicans
  • 2010: +/- 0

Election 2016 Predictions

It is time for the 2016 Election Day predictions…  Feel free to play along with the 2016 Pick ’em.

These selections are based on a model in progress that places a heavy influence on both race and industrial change since the 1990s.

POTUS 2016

This is by far, the most complicated election cycle that I have experienced.  We are in the midst of a potential reelection.  Hillary Clinton has quietly merged neoliberalism (think Reagan) and neoconservatism (think Bush) under the Democratic banner, while Donald Trump has revamped the Republican message into a populist, white nationalist tone.  This message is the exact opposite of the Romney post-mortem plan cobbled by Republicans, but it has been effective in shaking up the Democrats’ midwestern “blue wall” at the cost of losing the southwest.  As seen in the map to the right, new states like Arizona and Michigan are newfound battlegrounds, while others (Ohio and Missouri) are more settled towards their party.

In short, this race is incredibly difficult to project.

The map to the left reflects two major impulses: economic changes over the past 25 years and a focus of ethnicity, especially non-Cuban Hispanic voters.  This map includes several long-shots compared to poll-of-poll data compiled by many survey aggregators, but it produces a Trump victory by the closest possible margin: 270-268.

These projections use my issue-highlight model (probably to a fault), and make two broad assumptions: (1) Clinton will do well disproportionately well among non-Cuban Hispanics and (2) Trump will do disproportionately well among less educated whites in former manufacturing strongholds.  These assumptions are taken to an extreme in Michigan, Pennsylvania, and Arizona, but this map (like many other iterations online) is not outside of the realm of possibility.  Assuming that the GOP remains in the Trumpkin stance, this map become more familiar moving forward.

BATTLE FOR THE SENATE – RACE BY RACE

Each of the 34 senate races are worth a point; the House of Representatives serves as a tiebreaker.

  • AL – Shelby
  • AK – Murkowski
  • AR – Boozman
  • AZ – McCain
  • CA – Harris
  • CO – Bennet
  • CT – Blumenthal
  • FL – Rubio
  • GA – Isakson
  • HI – Schatz
  • IA – Grassley
  • ID – Crapo
  • IL – Duckworth *Formerly Republican*
  • IN – Young
  • KS – Moran
  • KY – Paul
  • LA – Kennedy, after runoff
  • MD – Van Hollen
  • MO – Blunt
  • NC – Burr
  • ND – Hoeven
  • NH – Ayotte
  • NV – Cortez Masto
  • NY – Schumer
  • OH – Portman
  • OK – Lankford
  • OR – Wyden
  • PA – McGinty *Formerly Republican*
  • SC – Scott
  • SD – Thune
  • UT – Lee
  • VT – Leahy
  • WA – Murray
  • WI – Feingold *Formerly Republican*

51 Republicans -3 (-3 to Democrats)
47 Democrats +3 (+3 from Democrats)
02 Independents UC

If these projections stay in place, then the Senate remains under Republican countrol. There are a handful or close races (Missouri, North Carolina, Indiana) that could shift the upper chamber closer to a tie (broken by the Vice President) or even to the Democrats.

 

House of Representatives (Tie-Breaker)

231R – 204D

End of Neoliberalism?

On January 1, I predicted that the 2016 election cycle would be an electoral realignment.  I was largely accurate; however I missed one main point: the changes to political discourse would threaten to fundamentally transform American politics in a way that has not been seen since the 1930s.  Donald Trump presents the contemporary structure of the American government the largest challenge that it has ever seen.

The decision this November is not simply Trump vs Clinton.  It is a fight for our way of life.

The First Republic and Congressional Dominance

In 1979, the leading scholar in American political science published the second edition of his masterwork.  Throughout The End of Liberalism Ted Lowi argues that the original classically liberal republic had transformed from a republic into a democracy.  While Lowi termed the new type of politics “interest group pluralism,” he inadvertently traced the impacts of the new type of liberal governance, now often dubbed neoliberalism.

Without chasing a rabbit hole into the depths of political theory, the original draft of the Constitution was a series of compromises that echoed both classical conservatism and classical liberalism.  From the 1700s vein of conservative logic, the founders assumed that man is inherently a self-interested, “bad” political actor.  Therefore, the government should focus on the rule of law and procedure rather than leave discretion to individuals’ whim; further, the government is necessary to prevent tyranny – either from the minority or the majority.  On the flip side, 1700s liberal ideas include the rights talk of life, liberty, and property – and generally a preference for the free market.  The Constitution cleverly implements these ideas into a unified form with separation of powers to prevent any faction from hijacking the government.  A quick refresher can be found in the Federalist Papers (especially 10 and 51), which highlight these tactics.

In general, the federal government was relatively weak.  Most of federal power lied in the hands of the Congress, while the President functioned as a clerk.  With rare exceptions (e.g. the Louisiana Purchase), the President was simply there to implement the policies produced by the legislature.  The Supreme Court was even weaker, with only the power to not do something (cooperate or not cooperate with the executive branch in enforcing laws).

Even extremely powerful Presidential figures struggled to impose their political will.  Jackson faced stiff opposition from Congress and the states, and only won the parts of his agenda that were ripe for corruption among his partisans.  Lincoln faced a rebellion, and his goals for reconstruction fell prey to a more powerful Congress – a legislature who imposed a regime so corrupt that Grant is often considered one of the most corrupt Presidents in history.

The period between Lincoln and FDRoosevelt is generally seen as a Congressional heyday, until reformers began to chip away at how government functioned.  There are remarkably few notable presidents in this era.  Woodrow Wilson – the President that led the States through the First World War was unable to deliver votes on treaties thanks to the power of legislative opponents.  Theodore Roosevelt was remarkably charismatic, but the reforms passed under his tenure were often promoted from legislative reforms rather than echoed from the Oval Office.

This structure of American politics placed immense power in the hands of legislative leaders.  Speakers from yestercentury called shots more often than their Presidential counterparts.  Yet the strength of this system (the mechanisms that produced party loyalty) eventually sparked the systematic demise of the political system: progressive reform.

How Reformers Killed Corruption and Congressional Power

This first structure was remarkably strong.  For the first century, corruption led the way for Congressional politicians, with backroom deals dominating political culture.  Major logrolls and compromises litter textbooks, from the Missouri Compromise to the Compromise of 1850.  Graft was a political tool that enabled these backroom political deals.  Plunkitt of Tammany Hall (America’s happier version of Machiavelli) lauded this type of government.  Plunkitt’s willingness to bend a few rules to help out the little guy was the American philosophy – from the political machines that dominated cities up to the hallowed halls on Capitol Hill.

Parties were the strongest organizing force in American politics for the decades between Lincoln and FDRoosevelt, according to consensus among political historians.  Those aspiring for political power would pay their dues to their party, exchanging loyalty and votes for favors from political bosses.  Loyalty to party was the most important currency for partisans, which allowed for remarkable cohesion across ideological and geographic lines.  Graft and favors were critical components of this game, but both are highly offensive to those not on the take.

By the late nineteenth century, politicians found that a running against those politically effective machines in cities and Congress would win votes.  Reform campaigns often proposed a bundle of laws lumped together generally as “Progressivism” – from civil service laws that prevented hiring unqualified friends and family to private ballot voting procedures.  These rules slowly matriculated into how Congress did business.  In 1910, after a coup for the Speakership, new Congressional leaders imposed rules that severely limited party leaders’ ability to pressure their partisans into votes.  By undermining this loyalty to party leaders, these rules sent political parties and Congress down a long, slow descent.

Interest groups filled the power vacuum left behind by declining political parties.  Political parties are coalitions who work together in order to win political power; interest groups are coalitions who work together in order to lobby government to implement certain powers.  During the heyday of political parties, bosses controlled access to favorable press, an army of campaign footsoldiers, and the expertise to manage increasingly complex political campaigns.  As party strength diminished, interest groups emerged as an alternative political resources critical to successful campaigns.  Rather than loyalty to a party boss, interest groups demand that their policy agenda move forward.  This exchange had a similar cost, but there is one critical distinction: loyalty to a legislative agenda is fundamentally different than loyalty to a specific cause.

As reforms slowly stripped power away from party leaders, Congress began to abdicate power to the executive branch.  This abdication was not directly to the President, instead it was to insulated parts of the government.  The process was somewhat simple.  First, an interest group would lure Congressmen into their flock, through rewards and threats.  Second, the interest group would demand that their Congressmen create favorable legislation.  Third, this new legislation nearly invariably required the creation of a new bureau in the executive branch.  Instead of risking political actors filling the office, the interest group would demand some semblance of expertise to hold that office – usually a series of credentials that qualifies only those sympathetic to the interest group’s cause.

A patchwork quilt of interest group iron triangles replaced the partisan system.  Iron triangles are a self-reinforcing, three-party relationship among interest groups, a Congressional committee, and executive departments.  Interest groups and Congressional committees exchange political resources for laws favorable to the interest group.  Congressional committees and executive departments exchange government resources (funding) in exchange for the autonomy needed to enforce laws favorably.  Executive departments and interest groups exchange favorable enforcement of policy for help securing funding from Congress and potentially huge payoffs once an administrator leaves the public sector for the private sector.  These relationships are extremely durable, and they are usually only hindered if an extremely powerful interest group provides an alternative to political resources to Congressmen.  The resulting policy system places this miniature network on an island of power, kings over their own slice of government.

Both the liberal and conservative views that underpin the Constitution suffered in this new system.  Newfound autonomy and intentionally ambiguous legislation shifted power into the hands of administrators littered across the executive branch.  The rule of law slowly transformed into a leviathan of increasingly complex rules, navigable only by those with expert literacy in a policy area.  By demanding overcomplicated rules of governance, policy networks were able to shift decisionmaking power into the hands of expertise.  In short, the islands of power captured by special interests fortified themselves by projecting presumed expertise and insulated themselves from challenges with red tape.  This new format short-circuited the republic’s safeguards against tyranny of factions by consolidating power into a coalition that reinforced itself across branches.

Lowi’s interest group pluralism is dominated by this network of interest groups.  When applied across the board, the emerging archipelago of islands of power shifted Congressional power to a gaggle of miniature policy oligarchies.  A once strong Congress effectively abdicated authority by creating fiefdom governments for their supporters.

Death of the American Republic and Capitalism

The implication of interest group pluralism on the marketplace drove a stake through the heart of capitalism.  Just as unique interest groups attempted to capture parts of the rapidly growing executive branch, industry groups fought for their piece of the regulatory pie during the abdication of Congressional power.

Government interference in the marketplace fundamentally changed in the postwar period.  In the past, the federal government has used subsidies as a blunt force to steer private capital in certain ways.  (The most lucrative is likely the massive land grants to railroads to develop a transcontinental transportation system.)  However, as the nation fell into the Great Depression, the seeds to end capitalism had already been sown.  When FDRoosevelt looked for advisors to get the economy moving again, he found a litany of industry groups ready to help write legislation.  The banking legislation during the New Deal is a classic example.  FDRoosevelt proposed legislation drafted by bankers to regulate banks – including a massive subsidy system that permanently intertwined the private banking system and the public political system.  The resulting iron triangle remains today, to the extent that when erratic decisions in the banking industry led to the largest financial crisis since the Great Depression remain unpunished.  In fact, those who steered the economy into danger were those who helped Congress write the new legislation.

The residue of capitalism remained, where the marketplace still provides largely private ownership of the means of production, private property, wage labor, and voluntary exchange.  However, claims that the market today resembles the microeconomic assumptions of perfect is extremely dubious, at best.  The ten largest firms the Forbes 500 have over $2,000,000,000,000 in total revenue – a total larger than the world’s eighth largest gross domestic product.  The top fifty firms on that list account for roughly one third of the United States’ purchasing power parity.  Market share points towards a system of oligopolies in nearly every national industry, regardless of the type of goods produced.  One does not have to travel far to find an industry pressure group that holds Congress and the executive branch’s hand through legislation.  Instead of a competitive marketplace, a few large firms compete over relative market share protected by public policy.  Firms in key industries remain too big to fail, yet too politically connected to divide into smaller competitive units.

The executive branch has often sought public private partnerships, agreements which are predicated on the turn-of-the-century reformer’s promise that businesses are run more efficiently than the public sector.  These agreements exchange public resources with private firms in order to provide services on the state’s behalf.  Responsibilities range from managing a redundant charter education system to managing turnpikes and other travel services to managing a growing prison system.  The efficacy of these programs remain hotly contested, with mixed evidence.

The resulting neoliberal political economy is an inseparable, tightly wound double helix of the public and private sectors.  Lowi notably predicted a similar outcome decades ago, although he focused more on the state’s inevitable financial debt to the private sector.  The private sector is overleveraged with this debt, which creates a mutual reliance between public and private.  The contemporary, interest group pluralist state relies on the private sector for the provision of public services, while private firms rely on the state for friendly legislation and the occasional bailout.  This economic structure can be roughly equated with neoliberalism.

Rise of Global Neoliberalism

The end of the Cold War allowed this neoliberal political economy to spread around the world.  Broadly defined, neoliberalism is a political economic philosophy that highlights the use of public policy to enhance the private sector – particularly privatization, fiscal austerity, and free trade.  However, the integration of politics into the market and the market into politics is a critical factor.  Neoliberalism has been the prevailing political economy philosophy in the global space since the end of the Cold War.

In most American history courses, the United States engaged a protracted ideological battle against the Soviet Union’s brand of communism.  This narrative often confuses neoliberal policy as democracy or capitalism.  Instead of democracy, the American political system is officially a republic and realistically a series of miniature policy oligarchies.  Instead of capitalism, the American economic system is more realistically a manipulated capitalism – where the state takes responsibility of organizing investment.  Today, government routinely manipulates tax rates, public subsidy, money supply, interest rates, and exchange rates to guide private dollars towards investment.  If government does invest directly into the marketplace, then it routinely partners with private actors.  The neoliberal policy menu is so pervasive that nearly all viable policy proposals in the United States are interpreted into monetary incentives – usually tax cuts or fees.

Once the Cold War ended, the United States’ neoliberal philosophy filled the ideological vacuum left behind by the Soviet bloc.  Neoliberalism dominated the global political economy.  The resulting quasi-free trade has aggregated most of the world’s economic production into a single, global marketplace.  With very rare exceptions (North Korea), the world has integrated into this larger space, with multinational corporations coordinating unprecedented amounts of economic power across the globe.

The Rise of Global Neoliberalism and the Impact on the United States’ Marketplace

Ross Perot was one of the last paleo-protectionists, a stalwart against neoliberal trade policies like the North American Free Trade Agreement.  Perot argued that if the United States opened up free trade with Canada and Mexico, massive manufacturing job loss would create “a giant sucking sound” that would drain the American economy.  Perot’s prophecies appear half true – especially in the Rust Belt.  If anything, the neoliberal policies sped up an already changing marketplace.  If businesses can produce the same good abroad for less than they can domestically, then they (as self-interested actors) will produce for lower costs.  Neoliberal trade policies removed some procedural costs of importing goods – and shifted that cost-benefit analysis towards moving manufacturing jobs elsewhere.

The United States had already started a long transition away from manufacturing.  In the late nineteenth century commentators lamented the rise of the manufacturing economy and relative demise of the agricultural economy, the main cause of this change was the transition of agricultural goods into commodities, while manufacturing goods provided uniqueness to allow entrepreneurs to claim monopoly power and profits.  Over time, manufacturing goods became increasingly commoditized – where all durable goods are roughly standardized.  As a result, manufacturing profit margins have dropped, leading to a new economic transition away from manufacturing.  The resultant postindustrial economy inspired a wide swath of critics at the turn of the millennium.  As the most prosperous multinational corporations exported manufacturing to poorer markets, a new marketplace formed in its wake.  Instead of making money by producing things locally, entrepreneurs prosper by commanding and controlling investments across the globe.

Creative capital is the most important resource in the postindustrial, neoliberal marketplace.  Unlike previous decades, where the accumulation of physical capital or volumes of laborers led to growth, the contemporary marketplace rewards places that can capture creative workers.  Just as unskilled labor fell in importance with the rise of manufacturing, skilled labor has also fallen to creative labor.  Creative workers are those who are able imagine and express new possibilities and are invaluable in high value-added industries like technology, engineering, business, and healthcare.  Creative workers are able to coordinate unskilled and skilled labor around the world, managing and improving global supply chains to gain the largest profit margin.  The cognitive ability to leverage resources in an increasingly complex marketplace places extreme demand on labor.

Immigration naturally rises to importance in the postindustrial, neoliberal marketplace.  Neoliberal policy prioritizes open markets, where both workers and resources can easily travel.  Communities of creative capital can attract the most prosperous corporations, as they present the highest likelihood of improving profitability.  As a result, cities engage in an amenities arms race to attract creative workers who are free to come and go.  This process usually results in gentrification – where poorer, less skilled workers are displaced by public private partnerships aimed at attracting creative workers.

In the postindustrial world, brain drains are the most significant threat to the local economy while brain gains are potential boons.   Unfortunately for most regions, creative capital is extremely demanding.  Sociologists note that creative workers flock to markets awash with amenities – from little Bohemias packed with hipsters to public and private art to professional sports to high quality schools.  A local politics of bread and circuses has emerged in many places, with local governments taxing locals to attract and keep creative workers.  In many cases, these amenities are somewhat public and benefit both the wealthy creative class along with their less wealthy counterparts.

Underneath the glitzy creative spaces and the newfound economic winners, neoliberal trade policy has negatively impacted a remarkably large number of workers.  Once proud manufacturers find themselves without work.  Businesses that supported those local manufacturers also suffer – after all, the restaurant across the street from the factory will have less patrons if the plant shuts down.  Many communities could probably absorb this loss with new growth; however, when combined with a potential brain drain of creative nomads seeking amenities, neoliberal policy changes have been devastating to many of those who prospered with the twentieth century economy.  Manufacturing moving away has proven harmed Midwestern communities unable to keep their creative workers (e.g., not Pittsburgh and Chicago); workers in supporting industries continue to flounder.

Overall the neoliberal political economy has led to the most remarkable period of growth in history.  Production is at an all-time high, and the amount of wealth created is difficult to fathom.  Quick calculations suggest 125% growth in the global economy from 1990 to 2010 – in the midst of the Great Recession.

Populism and the Radicalization against Neoliberalism

One recurring theme in American politics is the series of populist political revolts during economic recoveries.  These revolts often combine the promised attacks on economic winners with xenophobia to mobilize less sophisticated voters.  The political message is roughly a mad lib: “It is not your fault that you are poor; it is (insert group here)’s fault.”  Generally speaking, if the populists have a conservative slant, then it is a minority group.  Generally speaking, if the populists have a liberal slant, then it is big businesses that fill in the blank.

In the past, populists have been largely ineffective at enacting policy at the federal level – much less getting elected.  The government structure and anti-democratic institutions in the republic have served as a bulwark against these movements.  The basic model has been relatively straightforward: charismatic leader emerges, applies economic and social messaging, fails, and the movement diminishes.  In 1896, William Jennings Bryan hijacked the Democratic Party with anti-Darwinism and economic discontent with the 1893 Panic.  (Perhaps this was an improvement from the Jim Crow Democratic Party, but it planted a seed that has linked populist messages to racist undertones.)  In 1948, Strom Thurman split from the Democratic Party with a Jim Crow revival and regional economic discontent with the postwar recession in the South.  George Wallace repeated this message in 1968, although his attacks blamed both African Americans and business elites for workers’ plight.  In each case, the populist message has shifted further towards xenophobic beliefs.

Recently, populists have been more successful at the local level.  State governments routinely pass bills that discriminate against racial and social minority groups, in the name of attacking the group of people who harm the populist’s interpretation of middle America.  Local governments routinely pass bills that place municipalities into fiscal straitjackets – limiting their ability to provide services to the least advantaged.  In recent decades, coordinated efforts among conservative populists have installed a legislative agenda across the country.  More importantly, this movement has groomed a new generation of partisans – from elected officials to media outlets – that reinforce the messaging.

Recently, the TEA Party has been the central point of this extremely successful populist wave.  Unlike previous waves that focused on a one-shot federal campaign, the TEA Party has built an army of foot soldiers around a message.  According to their website, they prioritize domestic employment, less government, and several pro-white policies (English as an official language, removing illegal immigrants, etc).  The political infrastructure established by this movement has created an immense amount of copy that backs up these beliefs, to the extent that people can potentially exist in a bubble where all information is filtered through and biased by these political actors.

The resulting populist movement has radicalized against neoliberalism.

Trump and the Imminent Threat to Neoliberalism

Trump is a charismatic candidate that is attempting to reassemble the tried-and-true populist machine.  Except this time, the stakes are higher and the infrastructure is already in place.  The republic’s institutions that would normally dilute power from democratic whims (separation of power) have been frittered away by Congress.  The social infrastructure to develop, enhance, and deploy a populist message is readily available – and a loyal army of for-free foot-soldiers is in place to help Trump get elected.

At the start of Trump’s campaign, candidate Trump began releasing a series of position on his website.  The messages are consistently anti-neoliberal – to the extent that it appears that Trump is focused on disassembling the neoliberal state.

Trump launched his campaign platform on an illiberal, anti-immigration plank.  This policy paper roughly blames (illegal) immigrants for economic stagnation, calls for a border wall to inhibit future movement of laborers, and demands a mass deportation.  Context is often lost in political campaigns, but this policy would forcibly move twice the number of families as displaced by apartheid.  This policy flies immediately in the face of neoliberal policy, as it undermines the free flow of economic resources that allows markets to thrive.

Trump’s early economic platform had two major planks: changing the tax code and “renegotiate” trade treaties.  Proposed changes to the tax code include a fee for domestic corporations transacting business (and moving capital) overseas.  Trump is particularly critical of the US-China trade deals, and blames “unfair” foreign trade for economic stagnation.  Context is often lost in political campaigns, but dropping trade to China would remove 7% of the United States’ exports – literally hundreds of billions of dollars.  This policy flies immediately in the face of neoliberal policy, as it undermines the free flow of economic resources that allows markets to thrive.

Trump’s early social platform had two major planks: guns and veterans.  Trump’s gun policy moves beyond the typical genuflection towards the National Rifle Association.  Instead, the policy paper goes one step short of vigilante justice, calling to “empower… gun owners to defend themselves.”  This policy flies immediately in the face of neoliberal, classically liberal, and classically conservative policy, as it undermines the rule of law by shifting power from procedure into the hands of people.  Trump’s veterans policy would compel private physicians to treat veterans and wait for the state to pay.  This policy flies immediately in the face of neoliberal, classically liberal, classically conservative, and capitalist policy, as it undermines the choice of medical providers to provide services and negotiate prices.

Overall, Trump’s campaign can be summed up as anti-neoliberal.  Forced movement of families, cracking down on the free movement of economic resources, the call for vigilante justice, and compulsory service are authoritarian at best, and tyrannical at worst.  If anything, the policies outlined by Trump are the realization of the exact fears expressed in the Federalist Papers.  Unfortunately, the neoliberal regime that has fostered the environment to create Trump is the exact regime that undermined the republic’s ability to limit a charismatic autocrat’s reach.

The Choice This November

The 2016 election cycle presents the American people with a unique choice: the status quo or real change.  Ballots for Hillary Clinton represent voting for the status quo.  The special interest politics that corrupts the public will?  Clinton.  The neoliberal trade policy that accelerates the erosion of American manufacturing?  Clinton.  The most remarkable period of economic growth in world history?  Clinton.

Ballots for Donald Trump represent voting for an overhaul to this system; but the changes as promised appear to be in direct contradiction to the United States today and the United States as intended by the Founding Fathers.  To be frank, it is unclear if Congress is strong enough to check a charismatic populist arguing for authoritarian policies.  Trump represents change, but that change is likely not what historians will regard as a change toward “American” values.

The decision this November is not Trump vs Clinton.  The 2016 election is a referendum on neoliberalism and decades of American political economic theory.

Assuming that he intends to do what he says, a Trump victory means the end of neoliberalism.

Neoliberalism and Brexit

Voters in the United Kingdom have voted for the Brexit, a referendum for Great Britain to leave the European Union.  This is a monumental decision, which will have a large impact on the national, continental, and global economies.  This vote reflects a new phenomenon: neopopulism.

A Quick History of the European Union

The European Union formed in the wake of World War II.  Germany, France, Italy, Belgium, Netherlands, and Luxembourg unified their coal and steel markets — in order to prevent land grabs like the early parts of Nazi German aggression.  The economy clicked, which led to more cooperation across the marketplace.

Over time, other European states joined the economic community – integrating their national markets into a larger European marketplace.  Great Britain officially joined the community in 1973; voters affirmed the move in 1975 with a two-to-one margin.

Britain joined the EU, but it continued to be fiercely independent.  As continental Europeans moved towards a common currency, the British retained their national currency: the Pound.  Instead of having French Francs or Italian Lira, both states function off of the Euro.  In 1999, the European Union instituted the Euro, a common currency for many of the states, while Britain remained independent – which continued to build a divide between Britain and the rest of the EU.

The Brexit

Populists in Britain used various social prompts (xenophobia, racism, and nationalism) to win support and continue to be a thorn in the “establishment” politicians’ side.  In 2012, the British Prime Minister (think executive like a President elected by a legislature Congress) rejected an up-or-down vote to leave the EU, but he left the door open for a referendum to advise Parliament.  Fast forward a few years, and the populists held PM David Cameron to his word.

On June 22, the British went to the polls for a nonbinding referendum — but all indications suggest that the British government will follow the will of the people.  The election cycle clearly divided the British population.  Scottish voters (who recently considered leaving the United Kingdom), those living in cities, and especially Londoners voted strongly to remain in the EU.  Others  — especially in most likely to respond to nationalist and xenophobic queues – trended towards “leave” in recent days.  The UK Independence Party’s leader, Nigel Farage has played into these narratives, arguing that the EU makes Great Britain more vulnerable to several out-groups.

Immediate Impact

The British Pound lost ten percent of its value within an hour of television stations calling the election for “Leave.”  This devaluation is was enough to move the British economy from the world’s fifth largest to sixth largest.  The Euro is also falling, while the United States Dollar is winning.  In other words, people who own money as an investment are selling Euros and Pounds to buy Dollars.

British politics will likely go into a tailspin.  The current Prime Minister has argued that a “Leave” vote would make his position untenable, which may indicate future resignations and early elections for our British friends.  Scotland will likely consider another leave-the-UK referendum, especially considering that Scottish voters cast ballots to remain in the EU.  Ironically, they will leave the leaving country to stay.

The instability caused by this vote will likely cause increasingly shaky markets to suffer.  Nearly every multinational corporation has an office in London or the UK.  British lawmakers will create new economic winners and losers as they restructure their marketplace, trade laws, and relationship with many of their largest trading partners.

Long Term Impact

The European Union has never faced a member leaving, and it will put immense pressure on the other members.  Treaties that bound the organization always offered an exit strategy, but the departure of one of the largest economies will likely damage the European economy.  How much damage will be done remains unmeasured, however it will likely be extremely difficult for a multi-state economic union with many ailing economies.

The global economy will have to adjust to a less neoliberal stance from Britain, one of the most stalwart neoliberal voices in the world.  (For neoliberalism, think large corporations and free trade meets life, liberty, property, and rule of law of traditional liberalism.)

British populists scored a victory, which may embolden other populist candidates (see Trump, Donald) in other states.  Nationalist and xenophobic tones seem to trump even the most dire economic warnings – including threats that the British Pound could “implode” from experts.  For decades, money matters more than racism has been a prevailing school of thought in neoliberal states.  The rise of neopopulism in Western culture is an increasingly powerful force — the first to legitimately challenge neoliberalism.

Neopopulism

Historically, populism is a political doctrine that appeals to the hopes and fears of the general population.  Populist candidates often fail to win higher office, likely because they push too hard against the status quo interests – who already hold power and have deep political roots.  Although many would support the populist candidates, technology was unable to adequately unify outsider candidates.

Neopopulism is a remarkably stronger movement than previous waves of populism.  Neopopulists believe that they are doing the right thing, do what they think feels best, and trust their gut intuition over data analysis from experts.  They feel wronged by policymakers.

In many cases, populist candidates’ messages sound like a mad-lib.  “This country would be better if it were not for __________ cheating you by taking advantage of __________ , therefore we should do __________” is a classic example.  (For the left-leaning Sanders flair use: big banks, loose finance laws, regulate Wall Street; for the right-leaning Trump flavor use: immigrants, loose immigration policies, build a wall.)  In the contemporary world of social communication, new avenues for populist messages to take on additional potency.  Instead of reaching a crowd assembled in a physical space, neopopulist leaders can craft entire communities online – creating an echo chamber to reinforces messages into its members.  A quick trip into the comments sections on these websites will result in a quick realization that many people disregard observable facts – because they do not match the felt facts or the “common sense” dogma instilled by these communities.

Clash of Ideologies

Neoliberals face challenges from multiple fronts.

The external challenge is no longer from Soviet-style communism or the hybrid economic system in China.  From the outside, al-Qaida and the Islamic State provide a violent conservatism response under the guise of Islam.  Instead of valuing free trade and liberty, these actors seem more content with imposing social restrictions and tearing down the wanton spoils of neoliberalism’s dirty secret: the exploitation of labor in the developing world.

Internally, neopopulism presents the biggest threat to neoliberalism.  By playing on the lowest, most basic fears of less sophisticated voters, neopopulist demagogues can pass laws that undermine neoliberal economic ideals.  Neoliberalism is an inherently flawed philosophy that (unfairly?) creates a group of winners and losers, enables a world where the strong can bully the weak, and is responsible for the most remarkable period of economic growth in human history.  Neopopulist decisions — like the Brexit — threaten that prosperity.  What positives that will result from this philosophy remains to be unseen.

In Praise of Public Service

To my friends who are disappointed in local and state legislatures behaving poorly: go and be the change.

After I wrapped up my last class, several students did the obligatory linger and chat.  I had a young man ask me “who should I vote for?”  I told him that voting was not as important as getting up, going out, and becoming part of the process.  One of the students had taken the option of attending and observing a local government meeting.  (I used a choose-your-own-adventure assignment.  The local council option was rarely used but almost always enjoyed.)  He was already networking and motivated to get involved in local politics.

I caught the same bug two decades ago.  Public service is one of the best choices I have made.

I currently serve on the Horace Greeley Elementary School Local School Council.  For those not in Chicago, imagine a school board for an pre-K through eighth grade elementary school.  We approve budgets and oversee the principal who manages the day to day operations of the school.  The Horace Greeley Elementary School community elected me for a third term last April.  I am thrilled and honored to serve one of the best elementary schools.  Our faculty and staff serve a challenging population with a take-no-prisoners approach — and the students produce breathtaking results.  It is truly a special place.  Greeley restored the faith I had lost while teaching in Chicago Public Schools.

The reelection occurred at the same time the school entered a transition period.  Our long-term principal is moving on to bigger challenges; our loss is their gain.  That vacancy has filled the last couple weeks of our Council’s life.  Considering an estimated cut around $1 million (about 30% of our annual budget), the school needs a principal to hit the ground running.  Greeley has been blessed with an overwhelming number of qualified job candidates.  As a Council we labored to sort the “best” options from the good and better options.

When we held our candidate forum, some parents protested.  They felt that they were excluded from the process and favored an internal promotion.  I have attended and organized several protests in my life; it was a unique feeling to be on the other side of the table.  I understand both parts of the complaints.  Due to confidentiality rules, the interview process is by nature a less-open process.  Our meetings are always public, but they are rarely attended.  I agree that the alternatives that the parents proposed could be excellent principals.  Tempers boiled at the meeting, and some hurtful things were said by the protesters.  Some of the insults were salty, but nothing directed towards me was worse than I had heard from ill tempered teenagers.  I felt bad for my colleagues, and I remembered why I decided to stick with local politics: some people can say and do hurtful things.

Even at its worst, public service was worthwhile.  Being part of the growth of Greeley – the attainment of 1+ status (the highest rating CPS provides to schools), the development of a cutting-edge bilingual gifted program, the management of doing more with less during the austere budgets the past several years – has been an honor.  I recognize that the real work happens with the students, parents, teachers, support staff, and school administrators.  That said, if I can be a positive to that cause, then public service is worthwhile.

About a decade ago, I was in the middle of a municipal fight over parkland, commercial development, and campaign ethics.  Looking back, we never had a chance to get what we wanted.  We lost two of those issues, but I had the chance to write, campaign for, and pass ethics legislation.  I can look up the bill I wrote and point to something real that I helped accomplish.  It feels great knowing that even though we lost a war, we laid the groundwork for the next group to have a fighting chance.  In the ever worsening budget situation in Illinois, I look forward to looking back and finding the wins at Greeley.

As I told the folks after my last class, I was given a limited skill set.  I have tried to capitalize on what potential I was given.  Most people are naturally better at politics, than I am; the only reason why I rack up wins is because I get up, go out, show up, participate, and am part of the process.   I have learned that there are no permanent allies and no permanent enemies.  I have learned to get along with everyone.  I have learned that more important half of politics (and life) is showing up.

What are they thinking?

I have taken some time over the last several weeks to try to answer the question, “What are they thinking?” when it comes to people’s support for various Presidential candidates.  The answers are often surprising.  After having conversations with a couple hundred likely voters, I have some quick informal notes on trends among supporters of various candidates.  This analysis is result of an unscientific case selection, but observations come from a plethora of in-depth informal interviews and follow-up interviews.

Below, I discuss those candidates polling over 10% in surveys asking about their respective parties’ primary process.

Hillary Clinton

Clinton’s base can be divided into three identifiable segments: loyal partisan Democrats, neoliberals with a focus on expanding business positions, and symbolic representation voters.

The largest segment of Clinton’s support appears to come from mainstream Democrats.  These folks are most focused on continuing the Obama (and first Clinton) Presidency for another eight years.  Many of these folks are apolitical towards her policies, and they appear to be more focused on whether or not she can beat the Republicans.  When issues do come up, they are linked to a party’s position — specifically abortion and perceived Democratic influence on the Supreme Court.

The second largest segment (which is surprisingly large) are business folks.  These voters are often work for larger, multinational corporations what benefited from favorable trade policies under Bill Clinton and will likely prosper under the TPP negotiated (in part) by Hillary Clinton.  Although they are not fans of her proposed tax reforms, they point out ample loopholes in the tax code they expect to remain open.

Finally, part of Clinton’s base are voters seeking a female POTUS.  They assume that women’s position in society will be improved with Clinton in office.  When issues do emerge, they link back to the partisan divide on the Supreme Court and the Democratic platform of pro-LGBT and pro-choice positions.

Bernie Sanders

Sanders seems to have the most enthusiastic crowd of supporters.  Sanders’ campaign assembles two groups of voters: the idealist left and disenfranchised millennials.  On the one hand, there is a chunk of American voters who seem “left behind” as the Democratic party has shifted from the postwar left (democratic socialism lite) to a neoliberal stance.  These voters range from the quite complex politicos like Ted Kennedy to the blindly partisan hacks.  Ideology links this diverse array of sophistication on the political left behind Sanders — which may explain frustration expressed by many trying to work within the Sanders camp’s very loose national campaign structure.

Second, Sanders is one of two candidates who has tapped a strong populist strain in American politics.  Millennials disappointed by a meager marketplace are looking for someone to blame, and Sanders’ attacks on big, private institutions seems to resonate more than Trump’s attacks on beleaguered minority groups.  The intensity of these supporters will likely be tested in Iowa during the caucus.  As with any voters, questions remain: will fervor in day to day communications translate in the caucus halls and ballot box?

Donald Trump

People who support Donald Trump genuinely believe that he will make America great again.  Many of these folks believe that many groups of outsiders are ruining the American Dream, from illegal immigrants, immigrants (primarily from Mexico), ISIS, anyone connected to the Islamic faith, China, liberals, and Democrats.  They assume that Trump says what he means because he is the “only authentic” candidate on the Republican stage.

Most of Trump’s base appear to support right- and authoritarian policies to reinstate their ideals.  Although tighter immigration policies to creating a state religion may seemingly contradict “freedom,” to the Trump voter these policies are critical for restoring a rapidly deteriorating American Dream.

Many within Trump’s base are not sophisticated voters, but they are extremely skeptical of established political brands.  They value perceived conservatism (likely better defined as the Cheney-Rumsfield brand of neoconservatism prominent during the 2000s) before other values, but many of their beliefs are surprisingly populist or even center-left (including increased regulations on Chinese imports.)

Some of Trump’s base appear to be xenophobic, anti-minority, and racist.  In general, this appears to be a smaller segment than reported in the media and forwarded in social media.  Overall, the typical Trump voter is scared of another incompetent politician from soiling the American Dream instead of a racist demagogue.

Ted Cruz

Cruz’ support appears to center around the TEA Party, two elections later.  Most of these followers adhere to a hard-line, conservative platform that is non-negotiable.  Any deviation from this list of core beliefs is seen as a blend between heresy and treason.  If not framed as TEA Party stances, many of these beliefs would likely meet mainstream support (e.g., a balanced budget, reducing personal taxes, stopping government intrusion), while others are a bit overplayed compared to mainstream views (calls for mass deportation, gun ownership is “sacred”).

The media often mistakes Cruz’ support from evangelical Christians because of his faith.  After speaking with many pro-Cruz evangelical voters, it appears that Cruz performs well among the Born Again in the TEA Party — not the Born Again in general.  (That slice of the political pie seems to go to Carson.)

Instead, Cruz appears to draw support from an unapologetically conservative position, almost a direct descendant of Barry Goldwater’s century conservative position.  Cruz’ voters often see the federal government as critical threat against the American Dream.  Rather than the panicked fear many Trump supporters exhibit, Cruz’ crowd are highly suspicious of government.  Those who tracked the military exercises in Texas during Operation Jade Helm are resoundingly pro-Cruz.  Overall, the typical Cruz voter views themselves as a “pure” conservative and seek a pristine, non-liberal record.

Marco Rubio

The typical Rubio voter is an “establishment” Republican, or one that blends a mix of Reagan’s shining city on the hill with Bush’s compassionate conservatism.  They are often somewhat conservative, pro-business, and pro-life.  That said, Rubio’s crowd also seems more willing to compromise with Democrats than most of their counterparts.

The most surprisingly part of the Rubio base is how meek they are.  Enthusiastic Rubio supporters are surprisingly difficult to find; instead, they appear to be fulfill the “Silent” part of Nixon’s silent majority.  Many of Rubio’s crowds note that they are willing to shift to other center-right candidates like Kasich or Bush — whomever is most likely to defeat Trump or Cruz.  This trend became more poignant after a couple of polls suggested that Kasich led the establishment pack in New Hampshire.

Ben Carson

Carson’s declining base centers around two major groups: evangelical Christians and broad-strokes self-defined conservatives who are skeptical of Republicans.  Carson’s peaceful demeanor seems to be the largest draw.  Although his sleepy appearance may draw humorous critiques, the calm tone is strikingly different compared to those sharing a stage with Doctor Ben during the debates.

Evangelicals seem to be the most consistent supporter of Carson.  Many cite Carson’s social media messaging as proof that he is a “Christian man” and maintain similar moral values.  This trend is somewhat surprising, especially considering the presence of Huckabee — an evangelical minister — and Cruz’ ballyhooed TEA support.  The Carson voter is more of the evangelical brand who is likely to do mission work, rather than attend a box-church.

Carson’s supporters often take on the mantle of “conservative,” but these views are often not substantiated by hard-line values.  Abortion is a notable exception, and a staunch pro-life position links nearly all of Carson’s voters.