Month: February 2020

Branders vs Builders

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February 23, 2020

by Steve Stofka

At the National Press Club this week, Army secretary Ryan McCarthy spoke about people resisting change “because they focus on what they are going to lose instead of what they are going to gain” (C-Span, 2020). True? Not true?

In 2016, almost half of voters voted for change. In 2008, former President Obama ran on a platform of change. In his candidacy for the 2020 Democratic Presidential nomination, Bernie Sanders is touting big policy changes. He is leading in early caucus primaries and early caucus results place him as this weekend’s winner in Nevada.

Americans have been able to embrace change because our political institutions resist change. Unlike Britain, we have a written Constitution that proscribes or sets boundaries for change. In the U.S., minority interests are given more power to play an obstructionist role and this is particularly true in the Senate. When Harry Reid was the Democratic Majority Leader, he accused Republicans of obstructionism (C-Span, 2011). When the Republican Minority Leader, Mitch McConnell, became the Majority Leader in 2015, he made the same accusations against Democrats (C-Span, 2017). The parties trade scripts.

Tired of listening to the same script, a lot of voters chose an off-script candidate, Donald Trump, in 2016. For most of his term, the White House has been run on an informal basis, changing policy with the political weather in Washington. President Trump is a brander, not a builder.

Presidents who want to enact a large part of their agenda must be both branders and builders. It is an unusual combination of traits. In the 20th century, only FDR and Ronald Reagan were both. Perhaps Teddy Roosevelt. This is a subjective call. What are your candidates for the title of both brander and builder?

When a President is capable of both roles, the other party reacts strongly to what they build and their brand. This is certainly true of both FDR and Reagan. Republicans continue to tear away at the federal bureaucracy first erected by FDR. President Reagan was and is the champion of that movement among mainstream Republicans.

Responding to the worst recession since the Great Depression, Democrats elected a leader they hoped could emulate the substantial change in direction that FDR brought about. President Obama was neither a brander nor a builder. His “no drama” demeanor could not build coalitions in an age when people wanted a “fire in the belly” leader like Mr. Trump.

Bernie Sanders is such a “fire in the belly” candidate, but can he build the coalitions needed to pass direction changing legislation? He has not done so during his thirty years in the House and Senate, according to NYU historian Timothy Naftali (Stein, 2020). His campaign slogan is “Not me, us!” He is asking voters to play a vital role in melding political coalitions.

Mr. Bloomberg’s anemic first performance on the debate stage this week was hardly encouraging. Yet, Mr. Bloomberg appeals to practical Democratic and Independent voters, as well as establishment Republicans like Clint Eastwood who have tired of watching President Trump playing in his White House sandbox. This weekend Mr. Eastwood gave Mr. Bloomberg a thumbs up (Berley, 2020). Why would Republicans vote for a Democratic candidate? If the Senate remains in Republican hands, they will act as a check on a Democratic President and House. If other notable Republicans signal an approval of Mr. Bloomberg, that might persuade pragmatic Democratic voters to choose him as well. The road to the White House is a maze of planning, circumstance, and shifting voter and donor alliances.

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Notes:

Berley, M. (2020, February 22). Clint Eastwood Endorses Bloomberg, Citing ‘Ornery’ Politics. [Web page]. Retrieved from https://www.bloomberg.com/news/articles/2020-02-22/clint-eastwood-endorses-bloomberg-citing-ornery-politics

C-Span. (2011, September 6). Opening Remarks from Senators Reid and McConnell. [Video, Web page]. Retrieved from https://www.c-span.org/video/?301374-4/opening-remarks-senators-reid-mcconnell (01:11).

C-Span. (2017, July 11). Senators McConnell and Thune on Health Care. [Video, Web page]. Retrieved from https://www.c-span.org/video/?431157-2/senators-mcconnell-thune-health-care (13:24).

C-Span. (2020, February 14). Army Secretary Ryan McCarthy at the National Press Club. [Video, Web page]. Retrieved from https://www.c-span.org/video/?469279-1/army-secretary-ryan-mccarthy-national-press-club. (8:14)

Photo by Alfred Kenneally on Unsplash

Stein, J. (2020, February 12). As Bernie Sanders ascends, his potential White House approach to the economy comes into focus. Washington Post. [Web page]. Retrieved from https://www.washingtonpost.com/business/2020/02/12/bernie-sanders-ascends-potential-white-house-approach-obstacles-come-into-focus/

The Billionaire Ballot

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February 16, 2020

by Steve Stofka

“Dad, can I get a new bike?”

“What do you think money grows on trees?”

“No. If it grew on trees, I wouldn’t ask you for a new bike. I’d ask for a ladder so I could pick my own money.” A great comeback that I never said. No new bike. I could still dream of being President someday.

My dad was born before the Great Depression, a time when money lived in the ground. In 1849, people went crazy when they learned that there was gold in the dirt of California (PBS, n.d.). It’s God’s will, some said. In 1876, eight years after the Federal government signed a treaty with the Sioux Indians, gold was discovered in the Black Hills of North Dakota. Sorry, Sioux Indians, but you’ll have to move (NPS, n.d.). 

It took labor and money to dig up money when it lived in the ground. Now it lives in the digital “cloud.” Are we inherently distrustful of money that can be created with the push of a finger on a computer terminal? Seems too easy. We are 50 years into a system that is untethered from any practical restraint. The Federal Reserve guides their monetary policy according to goals set by a law passed at the height of inflation in the 1970s. They do not have to dig up dirt to get more money. They don’t have to keep gold or silver reserves. It seems like the same magical thinking of a kid who dreams about becoming President.

Presidential candidates must work hard to generate enthusiasm and donations of time and money to fuel their campaigns. A successful candidate for the Presidency usually finds a phrase that resonates with supporters.  In 2008, former President Obama used “Yes, we can” and various combinations of “Change” (List of U.S. presidential campaign slogans, 2020). President Trump used “Make America Great Again” during his 2016 campaign. His current slogan is “Keep America Great.” I heard Presidential candidate Sen. Elizabeth Warren sound out “Fighting Back” at a Virginia rally this past Thursday (C-Span, 2020). Mike Bloomberg has blanketed media with the phrase “Mike will get it done” (Mike Bloomberg, 2020).

In 2016, Marco Rubio and other Republican candidates complained that the inexperienced Donald Trump could buy the party’s nomination with his vast resources. Mr. Trump had promised to spend $100 million of his own money and spent $65 million in the final accounting (Peters & Storey, 2016). This was only half of the $121 million in inflation adjusted dollars that Ross Perot spent on his Presidential campaign in 1992 (Boaz, 2019).

Enter Mike Bloomberg. In the few months since he announced his candidacy, his campaign has spent $400 million (Burns & Kulish, 2020). His political spending is dwarfed by his charitable giving. In 2019, Mr. Bloomberg’s foundation donated more than $3 billion to charity. Unlike President Trump, Mr. Bloomberg has demonstrated his business acumen and has past political experience in the mud pit of New York City politics. He is used to the tough bargaining and political alliances that consume Washington. Mr. Trump knows only intimidation, not bargaining. He is the Twitter version of Venezuela’s former President, Hugo Chavez, who used radio to attack his political enemies.

What entices these billionaires to want a high stress job in Washington? What lies in the ground in Washington is not gold, but great power and reputation. Under FDR in 1932, the Democrats first began to consolidate political power in Washington. World War 2 and the Cold War helped grow that power base. So did the Federal programs of social support – Social Security, Medicare, Medicaid and countless others. Beginning in the 1960s, Congress began to grant the President more executive power to conduct war and administer the growing array of Federal agencies.

As the power of the Presidency grew, each Presidential campaign attracted more money. Through a series of campaign reform bills, Congress attempted to regulate the flow of money into politics. In the past decade, two recent Supreme Court decisions have undone many campaign regulations (Ballotpedia, n.d).

The discovery of gold in California and South Dakota attracted many prospectors who worked hard to grab the prize. Like today’s Presidential candidates, many miners did not have the resources necessary to capitalize on the opportunity. Well-funded companies like Homestake Mining proved successful. This is the era we are in now. Little Johnny or Mary can put away their dreams of being President. Is that good for the country?

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Notes:

Ballotpedia. (n.d.). Bipartisan Campaign Reform Act. Retrieved from https://ballotpedia.org/Bipartisan_Campaign_Reform_Act

Boaz, D. (2019, July 9). RIP Ross Perot, the Billionaire Who Ran for President. Retrieved from https://www.cato.org/blog/rip-ross-perot-billionaire-who-ran-president. Mr. Perot spent $65 million, or about $121 million in current dollars.

Burns, A., & Kulish, N. (2020, February 15). Bloomberg’s Billions: How the Candidate Built an Empire of Influence. Retrieved from https://www.nytimes.com/interactive/2020/02/15/us/politics/michael-bloomberg-spending.html

C-Span. (2020, February 14). Senator Elizabeth Warren Campaigns in Arlington, Virginia. Retrieved from https://www.c-span.org/video/?469313-1/senator-elizabeth-warren-campaigns-arlington-virginia (43:08).

List of U.S. presidential campaign slogans. (2020, February 14). Retrieved from https://en.wikipedia.org/wiki/List_of_U.S._presidential_campaign_slogans

Mike Bloomberg 2020. (2020). Mike Bloomberg for President: Official 2020 Campaign Website. Retrieved February 14, 2020, from https://www.mikebloomberg.com/

Peters, J. W., & Shorey, R. (2016, December 9). Trump Spent Far Less Than Clinton, but Paid His Companies Well. Retrieved from https://www.nytimes.com/2016/12/09/us/politics/campaign-spending-donald-trump-hillary-clinton.html

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Remove Impeachment?

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February 9, 2020

By Steve Stofka

Despite a strong labor market and a rising stock market, last year’s deficit was the largest in seven years (Tankersly, 2020). The tax cut package of 2017 has not delivered the promised economic growth. The first estimate of 2019 GDP annual growth was 2.3% (FRED, n.d.), the average during the past four years of the Obama administration. According to Mr. Trump, that growth rate was a “disaster” under Obama. Now it is a good growth rate. In his State of the Union address this week, President Trump said that “our economy is the best it has ever been” (CPR, 2020).

Growth during the three years of the Trump administration has averaged 2.5%, slightly above the tepid rate of growth under Obama. The growth standard is 3.0%, the average during the last fifty years of the 20th century.

How to make a tired nag of an economy look like a racehorse? The White House Council of Economic Advisors compared GDP growth during the Trump administration to growth projections of 2.0% made before the 2016 election (CEA, 2020). That comparison makes the growth rate look ½% higher than expectations. A component of GDP growth is government spending, whether that spending is borrowed or not. That additional growth has come at the expense of the Federal debt (CBO, 2020).

Like the Obama administration before, the Trump administration has bought itself GDP growth by borrowing money from the rest of the world and spending it. Without those annual deficits, GDP growth would have been negative for the past 15 years. The stock market has climbed 33% since the 2016 election because the money is flowing freely from Washington and the Federal Reserve. The amount of borrowed and printed money that the Federal government pumps into the economy creates additional profits for companies.

As predicted, President Trump was found not guilty by the Senate. Since the founding of the country, three Presidents have been tried for impeachment but not convicted. Let’s look at the Presidents who were not impeached even though they committed arguably impeachable offenses.

 President Franklin Delano Roosevelt was not impeached by a Democratic House for lying to Congress about the lend lease program to Britain in 1940. President Lyndon Johnson was not impeached by a Democratic House for lying to Congress about the Gulf of Tonkin attack in Vietnam in 1964 (Moise, 2019). President Ronald Reagan was not impeached by a Democratic House for his complicity in selling arms to Iran (Brown U., n.d.).

All of these were matters were of grave national importance to the American people. President Clinton was impeached by a Republican House for lying to them about his affair with a White House aide. Tawdry, yes. National importance? No.

Since no president has been convicted of impeachment, should we enact a Constitutional amendment to nullify impeachment? The arguments we have today about impeachment reflect the same arguments made by delegates at the Constitutional Convention in 1787 (Klarman, 2016). Some thought that state legislatures should initiate impeachment proceedings. The “New Jersey” plan proposed that a majority of state governors could remove a president. Some wanted to give the Congress power to remove a president at will, but others thought that would make the president subservient to Congress. Thinking that Congress might threaten impeachment as retribution for a presidential veto, some advocated against impeachment at all. Shouldn’t the voters decide, they argued? If the president were elected every two years, the voters could vote a president out of office at the next election. A Presidential term should last longer than two years was the counterargument. Most of the delegates agreed that impeachment was a check on a president and decided to include it in the Constitution.

What offenses should be subject to impeachment? The delegates disagreed on that as well. Some thought it should be for “malpractice or neglect of duty” but others thought the offenses needed to be more serious. “Treason, bribery, and corruption” was suggested, but “corruption” was not specific enough. “Maladministration” was proposed but was rejected. How about “other high crimes and misdemeanors against the State?” Well, that was more specific than “corruption” and “maladministration,” but not too specific as to straitjacket Congress. The final language inserted in the Constitution was “Treason, Bribery, or other high Crimes and Misdemeanors” (Article II, Section 4). Today, we argue about that wording. Go figure.

When the Constitution was written, the delegates did not contemplate a political system with two parties. Within two decades, they realized their mistake and initiated the 12th Amendment to have the president and vice-president elected together from the same party.

Some Constitutional delegates worried that the impeachment process would become politicized. History has shown that they were right. Should we admit that a conviction of impeachment is practically impossible? We must either lower the threshold for conviction in the Senate from a super-majority of 67 Senators to a majority vote, or remove the idea of impeachment from the Constitution entirely. What do you think?

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Notes:

Brown U. Research. (n.d.) Understanding the Iran-Contra Affairs: The Beginning of the Affair. [Web page]. Retrieved from https://www.brown.edu/Research/Understanding_the_Iran_Contra_Affair/i-thebeginning.php

Colorado Public Radio (CPR). Transcript & Video: President Donald Trump’s 2020 State Of The Union. [Web page]. Retrieved from https://www.cpr.org/2020/02/04/transcript-video-president-trumps-2020-state-of-the-union/

Congressional Budget Office (CBO). (2020, January). Budget and Economic Data. Retrieved from https://www.cbo.gov/about/products/budget-economic-data#2 Note: 2019’s Federal deficit was 4.7% of GDP, 40% higher than the 3.3% deficit in 2016, the last year of the Obama administration.

Council of Economic Advisors (CEA). (2020, January 30). United States GDP Growth Continues Exceeding Expectations. Retrieved from https://www.whitehouse.gov/articles/united-states-gdp-growth-continues-exceeding-expectations/

Federal Reserve (FRED). (2020, January 30).  Real Gross Domestic Product (GDPC1). [Web page]. Retrieved from https://fred.stlouisfed.org/series/GDP

Klarman, M. J. (2016). The framers coup: the making of the United States Constitution. New York, NY: Oxford University Press. (pp 235-237).

Moïse Edwin E. (2019). Tonkin Gulf and the escalation of the Vietnam War. Annapolis, MD: Naval Institute Press, (Preface). Sample retrieved from https://books.google.com/books?hl=en&lr=&id=0UEnAnvQ978C&oi=fnd&pg=PR11&dq=gulf+of+tonkin+vietnam+war

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Tankersley, J. (2020, January 13). Budget Deficit Topped $1 Trillion in 2019. NY Times. [Web page]. Retrieved from https://www.nytimes.com/2020/01/13/business/budget-deficit-1-trillion-trump.html

A Normal Week

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February 2, 2020

by Steve Stofka

Tuesday was the first day of President Trump’s impeachment trial. Mr. Trump borrowed former President Clinton’s impeachment playbook and got busy. He flew to Davos, Switzerland to give a speech at the World Economic Forum.

The speech was constructed of many truth stretchers. Instead of boasting about the economy’s strong employment, Mr. Trump had to say that the numbers are the best. They are not. Doesn’t matter. While Mr. Trump’s political opponents are spending time and energy disputing his boasts and lies, he is on to the next speech, the next carefully arranged event.

Facts are musical notes in a score designed to showcase his greatness. Mr. Trump is the bandleader. In politics, performance is key and he is a good performer. He is the boss of facts. Disagreeable facts are out of tune and “fake.” Sit down fake news media. Stop playing.

President Trump cites a statistic that there are more women than men in the workforce for the first time in history. They are not. That happened in 2009 under former President Obama’s watch. This is not a good statistic. It means that men in traditional male jobs are losing their jobs. In 2009, it was the massive unemployment in construction after the housing crisis. Until a year ago, job openings in manufacturing had climbed steadily (BLS, n.d.). In 2019, Mr. Trump’s trade war with China led to thousands of factory job losses and a sharp decline in job openings.

Those who do follow economic numbers know these are truth stretchers or truth wreckers as soon as the words leave Mr. Trump’s lips. That’s a small percentage of the general population. In an age of ready access to information, there is too much information. We struggle to separate the wheat – reliable information from a reputable source – from the chaff – those who shade or hide the truth to push a point of view.

To a casual ear, Mr. Trump sounds like he knows what he is talking about when he says 150 billion of this and 200 million of that. He pulls numbers out of the air just as a magician pulls a quarter from behind a child’s ear. When questioned by reporters, members of his own party answer that they can’t speak to what Mr. Trump says or tweets. They are afraid of retribution. He is the Teflon President. No accountability and no shame. 

A president must perform. A good performer tells enough of the truth to tell a convincing story. Lying is a part of any president’s job. They must lie to foreign leaders as they play the international game of political poker. Presidents lie to hide uncomfortable truths from the American people. They lie to protect themselves, members of their cabinet and party. Until a presidential candidate takes the oath of office, they may not realize the full extent of the lies they must tell. It’s one of the stresses that make the job so difficult.

There is important and unimportant stuff to lie about. Mr. Trump lies about silly stuff that matter only to him. Who cares whether some people think he has small hands? He does. Whether he had a smaller inauguration crowd than Mr. Obama? Mr. Trump cares. Whether he understands the dictator of N. Korea better than everyone else? He does. He insists that he is a better president than George Washington or Abraham Lincoln. Braggadocio?

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Notes:

Bureau of Labor Statistics (BLS). (n.d.). Job Openings: Manufacturing JTS3000JOL. [Web page]. Retrieved from https://fred.stlouisfed.org/series/JTS3000JOL

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