A Man and his Kingdom

November 22, 2020

by Steve Stofka

In Shakespeare’s tragedy, King Richard III offers his kingdom for a horse after his is struck down in battle. Mr. Trump echoes the reverse sentiment, bargaining and plotting to retain his kingdom.  

The White House has archived a Heritage Foundation sampling of election fraud (Heritage Foundation, n.d.) Most of them are for local and state elections because fraud has some degree of potency in smaller elections. In a Presidential race, an attempt at fraud is like pouring a cup of water in a lake. Some of the cases are sad. A son is convicted for submitting a ballot for his mother who has just died. Some vote twice in an election even after being warned not to by election officials. Some cheat to get their friend or their boss elected to city council.

Conspiracy theorists claim that this is just the tip of the iceberg. “Absence of evidence is not evidence of absence,” they claim. Christians explained that objects fell to the ground because angels pushed them. They used the same reasoning, evidence of absence, to counter Newton’s claim that it was a force called gravity. Newton’s theory was more predictive, but I dare anyone to show me that angels are not making things fall to the ground.

Why won’t President Trump concede the election? Trump’s efforts have been dismissed by courts, including one state Supreme Court. Some on the right point to the 2000 election and the lawsuits brought by Democrats in the Florida count as a justification for Trump. The 2000 Presidential election was decided by 537 votes out of 6 million in the state. That is a small probability multiplied by the small probability that such a result would matter in the Electoral College. Perhaps 2 in a 1,000,000; it had never happened before in U.S. history. The probabilities indicate that it has never happened before in human history. Are Mr. Trump’s election numbers as close as the 2000 election? Hardly.

Katherine Harris, Florida’s Secretary of State, may have committed fraud in the 2000 election; it makes sense to risk fraud when the vote difference is that narrow. A difference of 10,000 votes – the smallest difference in any of the states that Trump is contesting – is not narrow.

Mr. Trump claims fraud before every contest. When he picked one wrestler in the 1988 WBF wrestling championship that he sponsored, he claimed that the other side was cheating. His guy won despite the cheating. Huzzah! He is a promoter. If accusations of cheating arouse the crowd, let’s do it.

After the 2008 election, Mr. Trump led the “birther” movement, claiming that Mr. Obama had cheated because he was not born in the U.S. Before – not after – the 2016 face off with Ms. Clinton in 2016, he claimed that Democrats were stealing the election (Zeitz, 2016). What works in wrestling works in elections, doesn’t it? Get the crowd’s attention. Play to the 5-year old in each of us.

Supporters of Mr. Trump point to the 1960 Presidential election as evidence for fraud. JFK (this is the anniversary of his assassination) won Illinois’ electoral votes by a slim margin of almost 9,000 votes in Cook County, where the mayor was a supporter of JFK and a family friend (Zeitz, 2016). Absence of Evidence is not Evidence of Absence.

Did Nixon throw the 1968 election? Just before the election, President Johnson called a halt to bombing in South Vietnam to give Vice-President and candidate Humphrey a boost in the polls. The Nixon campaign countered by promising a better deal to the other side if Nixon was elected. Aiding and abetting a foreign enemy? (Kilgore, 2018).

To distinguish this from election fraud, let’s call it election rigging; a campaign conducts a strategy which will help win them the election without altering votes per se. The Watergate scandal in advance of the 1972 election was an attempt by the Nixon campaign to get intel on the other side’s campaign. If Nixon had admitted to it early on, the press might have made a big brouhaha for a few months and it would have blown over. The public might have regarded it as corporate espionage – an attempt to discover the competition’s secrets. Nixon kept it within the American family.

That was not the case in the 1980 election; like the 1968 Nixon campaign, the Reagan campaign sought help from a foreign power, Iran. The Carter Administration had negotiated through Algiers a release of American hostages who had been in captivity for a year. The Reagan camp promised better terms to Iran if they would delay the release of American hostages until after the 1980 election and the swearing in of Ronald Reagan. The drawn-out hostage crisis was one of several key events that cost President Carter re-election, and Reagan handily defeated Carter. Iran released the hostages the day that Reagan took the Presidential oath (U.S. Dept. of State, n.d.). Americans spent an additional 90 days in prison so that Reagan could win an election. Election strategy, not election fraud.

Voting is essential to a democracy. So is free speech. Unless one can control speech as they do in Russia and China, the best offense is to add more speech to dilute authentic opinion. When Mr. Trump claims that more “illegal” votes were added to dilute the votes of true American opinion, he is taking a page out of the playbook that the KGB and Communist Party use.

He has cozied up to Vladimir Putin, to Kim Jong-un, and Xi Jinping, all Communist dictatorships. That is the America that Mr. Trump wants – a private kingdom of his own just like those guys have. He is jealous of their power and their control of the media. He wants his own kingdom for just four more years. How many Republicans will help him achieve his dream?

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Photo by Annie Spratt on Unsplash

Heritage Foundation. (n.d.). A Sampling of Election Fraud Cases from Across the Country. Retrieved from https://www.whitehouse.gov/sites/whitehouse.gov/files/docs/pacei-voterfraudcases.pdf. (Notice that this report by a private foundation has been archived at the White House).

Kilgore, E. (2018, October 16). The Ghosts of the ’68 Election Still Haunt Our Politics. Retrieved November 21, 2020, from https://nymag.com/intelligencer/2018/10/1968-election-won-by-nixon-still-haunts-our-politics.html

U.S. Dept. of State. (n.d.). An End to the Crisis. Retrieved November 21, 2020, from https://history.state.gov/departmenthistory/short-history/hostageend

Zeitz, J. (2016, October 27). Worried About a Rigged Election? Here’s One Way to Handle It. Retrieved November 21, 2020, from https://www.politico.com/magazine/story/2016/10/donald-trump-2016-rigged-nixon-kennedy-1960-214395

What’s In the Mirror

November 8, 2020

by Steve Stofka

Every hour of the day, Mr. Trump issues a barrage of tweets about massive voter fraud. No evidence. He began his four-year term with the ridiculous claim that he had larger inauguration crowds than former President Obama. The overhead photos clearly showed that not to be the case. He claimed the photos were doctored.

Some families are unfortunate to have a crazy uncle that no one wants to invite for Thanksgiving. Mr. Trump is our crazy uncle President. Chris Christie, his former campaign and transition manager in 2016, has challenged the President to show the evidence.  There is none. There are a few isolated irregularities as always but no evidence of massive voter fraud.

I grew up a few miles from our wonder boy President. In our neighborhood, his whining and sniveling would have earned him a “put on your big boy pants, peckerhead.” He never had big boy pants, because his daddy kept him in diapers, buying him whatever he wanted, covering up for his stupidity and recklessness. 

Where I grew up you learned to fight your own battles. Our daddies didn’t coddle us. We didn’t have an army of lawyers to protect us, or doctors to get us out of the draft. We didn’t have the money to buy women. We had to earn our own way.

During the Cold War years, Americans trained their paranoia on the Communists. They were everywhere in America. At mid-century, people lost their jobs and had their careers cut short in a Republican witch hunt to rout out the Communists. Whenever Republicans want to rouse up their base, they complain of Socialists and Communists trying to take over the country. From the 20th Century playbook the older people are passing on their hate and paranoia to their kids who will carry on the tradition through this century.

Our culture thrives on conflict, and our media and politics profits from turbulence. Like our judicial system, we have an adversarial political system. Competition rather than cooperation is the default strategy. Both sides of an issue try to obscure rather than clarify issues. Our conflicts become our entertainment.

During the First Battle of Manassas in July 1861, congressmen and wealthy families from Washington picnicked at an observation point while young men slaughtered each other. They didn’t have TV then. Their picnic turned to panic when they were caught in the rout and retreat of Union soldiers.

America is a congregation of the world’s refugees. Persecuted or disadvantaged in their home country, many of our ancestors came to America to create a space for themselves. They brought their hopes and their hatreds. The first civil war was the American Revolution, when thousands of colonial citizens fled to Canada to avoid death at the hands of their countrymen.

In the 19th century immigrants from other European nations came streaming in through the ports and borders of America. Thousands of Irish farmers fled during the potato famine in their country at the mid-century. Chinese workers helped build the railroads during and after the Civil War. Shortly thereafter, in 1882, they became the first nationality to be excluded.

Expanding industrial businesses in America needed workers at dirt cheap wages. America opened the door to Europeans from north and south. They carried with them their hopes of a better life and decades or centuries of prejudices they had been taught since childhood.

One of those was a German young man fleeing obligatory military service. He was Donald Trump’s grandfather, Friedrich Trump (Frost, 2018). His son and grandson, our President, would disavow their German heritage in later years. Like his grandfather, Donald Trump evaded military service when his daddy paid a doctor to falsify medical records. Some traditions are important in the Trump family.

After World War I, America closed its borders to all but a few European nations. Antipathy to Germans ran high after the war. Returning servicemen still clung to their belief that the only good German was a dead German. Still, the nation was not among the excluded countries in the immigration act of 1924.

In 1965, a new immigration act reopened borders; now refugees from Asia and Latin American countries came to America. Like the Europeans, they brought their peculiar prejudices and a centuries long history of slaughter and civil war.

This country is founded on hope, prejudice, and tolerance. People of other nations have despised their neighbors because of religion, culture, ancestry, and history. America is the melting pot of that ugliness brought here by people from around the world. The torch held aloft at the top of the Statue of Liberty burns bright with the starshine of our ideals and the burnt cinders of our hatreds. People in other countries look to America and the millions of guns stashed in homes throughout our country; they wonder how is anyone still alive in America? If we can tolerate each other, there is hope for the rest of the world.

We are a tolerant people, civilized savages in a nation of laws. We go to church on Sunday and throw rocks at 6-year old Ruby Bridges, a black girl walking to school (Hilbert College, n.d.). That was sixty years ago this coming week. We pour out our sympathies and open our pocketbooks to help those whose lives have been torn apart by disasters around the world. We swear on our bibles, then tuck them away, pick up our torches and light Vietnamese children on fire. Love, charity and the darkness within.

Mr. Trump tapped into the power of our hatred and will continue to be a force in American politics. With millions of Americans following his Twitter feed, he delights in the conspiracies that feed the flames of righteous anger and justified hatred. As Pogo said, we have met the enemy and he is us.  

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Photo by Erik Eastman on Unsplash

Frost, N. (2018, July 13). The Trump Family’s Immigrant Story. Retrieved November 08, 2020, from https://www.history.com/news/donald-trump-father-mother-ancestry

Hilbert College. (n.d.). Social Justice Activists: Ruby Bridges. Retrieved November 08, 2020, from https://www.hilbert.edu/social-justice-activists/ruby-bridges

America Thirsts

October 18, 2020

By Steve Stofka

“America First” was a rallying cry of the 2016 Trump campaign but the isolationist sentiment and the name go deep into our country’s past. It is more fundamentalist than conservative, gathering its supporters from the far right. An America First Committee formed in 1940 as an opposition movement to America’s involvement in World War 2. After Pearl Harbor, it was disbanded, but an America First Party fielded a fundamentalist candidate in the 1944 election.

Was Mr. Trump the first to adopt the slogan for an election campaign? No. Both Woodrow Wilson and Warren G. Harding used the phrase a century ago. The journalist and 2000 Presidential candidate Pat Buchanan ran under the banner of the Reform Party. Known for his isolationist stance even when he worked in the Nixon administration, he famously – or infamously – cost Al Gore the election in the 2000 election. Because of his placement on the ballot next to Al Gore’s name, many voters who had voted Democratic incorrectly marked Buchanan on their ticket.

Russia and China would prefer that America stay out of world affairs. Our intelligence agencies have confirmed that Russia is actively working to re-elect Trump. When pulled the U.S. out of the Iran treaty, that left Vladimir Putin holding the major foreign influence in that country.

While China has had its difficulties with Mr. Trump’s erratic trade policies, they prefer someone who pays more attention to his poll numbers and the daily fluctuations in the stock market. Both countries needed an American president with little experience of international politics; someone who does not read his intelligence briefing book; someone who uses a large sharpie to sign his name because he doesn’t write much but his name. While Mr. Trump stumps around on the stage of American politics, Russia and China gain more influence daily. He has become America’s vulnerable spot in global affairs.

Mr. Trump’s business philosophy is not isolationist; he owes hundreds of millions to Deutsche Bank. He owns a golf resort in Scotland and has tried to build a hotel in Russia. This week he joked – I think it was a joke – that he might have to leave the country if he loses the election. He might do so to avoid the many legal proceedings against him for election fraud, financial fraud, and securities fraud. Perhaps he will build a golf course or a hotel in Russia, where Mr. Putin will protect him from extradition.

Americans thirst as they line up at early voting polling places. They thirst for someone less headstrong, someone more mannered and less combative, someone who reads, someone who prepares, someone who takes the job of President seriously. Americans thirst.

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Notes:

Photo by Aaron Burden on Unsplash

The Bargain

August 2, 2020

by Steve Stofka

Deep below the U.S. Capitol Building, several men stand guard outside a door. Inside the room are House Speaker Nancy Pelosi and Senate Majority Leader Mitch McConnell. With each of them is an aide.

“If you can arrange a voice vote to impeach on Monday, my members can deliver the needed two-thirds majority to convict,” the Senator says. “Vice-President Pence will serve out the term. Utah Senator Mitt Romney has agreed to accept the party’s nomination this August.”

Ms. Pelosi eyes McConnell warily. “We like our chances against Trump. Romney’s a moderate that a lot of Republican voters – maybe even some Democratic voters – will welcome. I need more.”

McConnell clears his throat. “I’ll reduce the liability protections for big businesses, but my members will not budge on lawsuit protections for smaller businesses. This is something your own members can get behind. Who doesn’t like small business in America?”

Pelosi motions to her aide who hands her a summary of the second relief bill that the House passed in May. She glances at it. McConnell fights the smile that tugs at the left corner of his mouth. Pelosi is not fooling him. The paper is a sham. She’s got her demands memorized.

“Revoke the SALT provision in the tax bill,” Pelosi says. McConnell shakes his head. “We’re in the middle of a pandemic, for God’s sake, Mitch. We can argue it out in the next Congress. One year of relief. One year only.”

“You agree to the one trillion package we passed this week,” McConnell says.

“We passed a three trillion dollar bill back in May and your members and the White House couldn’t agree on how much the American people should suffer,” Pelosi accuses him.

“Unlike your coalition, Nancy, ours comes from a lot of diverse areas from all over the country,” McConnell argues. “They have a wide range of concerns and perspectives.”

“White concerns, white perspectives,” Pelosi shoots back. “I need more help for state and local governments.”

“States like Illinois and New Jersey have underfunded their public pension plans for years,” McConnell says. “We’re not using the Covid crisis to bail out corrupt state politicians with no fiscal discipline.”

“We’ll set up a joint oversight committee to monitor how the states and cities spend the money,” Pelosi offers.

“Money is fungible,” McConnell says. “No way to properly monitor it. I’ve got too many members from small states who have struggled for years to attract good talent for city and state government. They couldn’t offer fancy pension packages. They were responsible. Their pension funds are not badly underfunded like Illinois. They just won’t go for it.”

“I’ll take SALT off the table and meet you two-thirds of the way on aid to the states and cities. You’ll look like a tough negotiator, but I’ll have to go back to my members and tell them that I gave away $1.5 trillion in aid that they voted for in May. You want to build fighter jets that the Air Force doesn’t want and yet you’re taking money away from students and teachers? That will be a good campaign ad this fall.”

“Not negotiable, Nancy. My members will take their chances with Trump if I give in on the military aid. Too many communities depend on that production. I’ll go halfway on aid to state and local governments.”

Pelosi turns to her aide. “How much is the final package?” McConnell knows that she has calculated exactly what the figure is. The aide says $1.6 trillion. Pelosi holds out her hand and they shake. “I’ll make the announcement at 9 A.M. on Monday.” She and the aide leave the room.

“Stop, stop, stop,” my wife says as she shakes me awake. “You’re yelling ‘you won’t believe it!’ over and over.”

It’s still dark out but the first half-light of early dawn is in the sky. Boy, it seemed so real. I sit up.

“This is not like you,” she says. “What won’t I believe?”

I give her a hug. “Never mind. Sorry I woke you.” I lay down and go back to sleep.

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Photo by Austin Kehmeier on Unsplash

A Tug of War

June 7, 2020

by Steve Stofka

Is grandma your enemy? An uncomfortable thought. Different generations have different concerns. Funding a solution to one generation’s problem may take resources from other generations. Grandma wants to protect her Social Security and Medicare. Grandma votes her interests.

The introduction of Social Security eighty years ago marked an extraordinary shift in federal policy. For the first time in the history of this country the government took money from one set of people – those who were younger and working – and gave it to other people. This transfer was not a reward for military service – an old soldier pension – but a reward for getting old.  

During the Great Depression thousands of banks failed and millions of people lost their savings. That crisis called for a solution. Instead of addressing the problem, FDR and a super-majority of congressional Democrats created a permanent program that transferred money from people raising families to retired people. No military or community service required. The combined tax contribution to fund the program was 2%. It is now more than six times that.

In 1965, Democrats again enjoyed a super-majority in Congress and a Democratic President. Never waste a super-majority. There are no checks and balances. They passed the Medicare program, funded by a tax on working families who were ineligible for benefits under the program. In every election, old people vote to keep their benefits, and are the largest demographic of voters (Census Bureau, 2019). 

Younger voters change addresses more often. In dense urban areas with multiple voting districts, they are more likely to have out of date voter registration. Voters in rural districts remain in the same voting district when they move a few miles. Rural voters are predominantly older, white and conservative. In the first half of the 20th Century, rural populations migrated from the farm to the city. Rural voters controlled political power in many states because one rural vote counted far more than one urban vote. In two decisions in the 1960s, the Supreme Court interpreted the Constitution to mean one person, one vote (Mosvick, 2020).

As the children of farmers continued to move away in the last half of the century, rural voters adopted other strategies to control electoral power. Less funding for polling places in urban areas, claims of voter fraud, lifetime restrictions against voting by convicted felons, and locating prisons in rural areas where the prisoners are included in the county’s population, but the prisoners cannot vote. Groups like Judicial Watch initiate hundreds of lawsuits in Democratic leaning counties to invalidate the registrations of many voters (Lacy, 2020).

In 1965, a year after passage of the Civil Rights Act, President Johnson hoped that the newly instituted Medicare program would help stem the defection of Southern voters from the Democratic Party. It didn’t. The Party had successfully stifled the voting power of black people in the south for a century. The 13th, 14th and 15th Amendments which gave black people voting power and citizenship status had been forced on the Southern states after their defeat in the Civil War. Feeling that President Johnson and the party had betrayed them, voters sought a champion who could protect white voting power. 

Richard Nixon became their champion by default. In the 1968 race, the Republican candidate employed a “ southern strategy” that spoke to white voters worried that the recently passed Civil Rights Act would give blacks too much electoral power. In the spring, riots and demonstrations broke out after Martin Luther King’s assassination. At the Democratic Convention that summer, bloody conflicts broke out between Chicago police and anti-Vietnam War demonstrators. Nixon promised to be a law and order President, protecting the “old order,” older Americans and the white rural domination that had been the calling card of the Democratic Party in the South. When leading Democratic candidate Robert Kennedy was assassinated that summer, the party was too disorganized to mount a challenge to Nixon. He won by a convincing margin in the electoral college, but bested Hubert Humphrey by only ½% of the popular vote (Wikipedia, 2020). 9 million voters chose Independent Party candidate George Wallace, who appealed to disaffected conservative Democratic voters in the South (PBS, n.d.).

Some of us have supremacist attitudes, some of us condemn those attitudes. Some of us feel threatened at the sight of a black man and call the police. Some of us understand Black Lives Matter; others don’t. We all understand our point of view a lot better than our neighbor’s. We all want to be believed more than believe.

We grant police the sanctioned use of force but we require temperance in their use of it. Clearly, there are many officers who do not have a tempered behavior. The lie is that it is a few bad apples. Smart phones have become common only in the past decade and there are hundreds of videos of officers acting without restraint. In another ten years, there will be thousands.

 One person, one vote. This country has been engaged in a tug of war since its founding. Regional and generational interests pitted against each other. Rural against urban. Businesses vs workers. City governments vs. workers. States vs. citizens. Decide which end of the rope you are on and pull. Grandma grabs the rope. In every election, a lot of money and effort is spent to prevent people from voting. If you don’t vote you are doing those on the other end of the rope a favor and they thank you.

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Notes:

Photo by Arnaud Jaegers on Unsplash

Census Bureau. (2019, July 16). Behind the 2018 U.S. Midterm Election Turnout. Retrieved from https://www.census.gov/library/stories/2019/04/behind-2018-united-states-midterm-election-turnout.html

Lacy, A. (2020, May 28). Right-Wing Groups Aims to Purge 800,000 Voters in Pennsylvania. Retrieved from https://theintercept.com/2020/05/28/pennsylvania-voter-rolls-purge-judicial-watch/

Mosvick, N. (2020, March 26). On this day, Supreme Court reviews redistricting. Retrieved from https://constitutioncenter.org/interactive-constitution/blog/on-this-day-supreme-court-reviews-redistricting.  Also, see Stahl, 2015.

PBS. (n.d.). Thematic Window: The Election of 1968. Retrieved from https://www.pbs.org/johngardner/chapters/5a.html

 Stahl, J. (2015, December 7). Baker v. Carr: The Supreme Court gets involved in redistricting. Retrieved from https://constitutioncenter.org/blog/baker-v-carr-the-supreme-court-gets-involved-in-redistricting

Wikipedia. (2020, June 06). 1968 United States presidential election. Retrieved from https://en.wikipedia.org/wiki/1968_United_States_presidential_election

Look Back, Look Forward

December 29, 2019

By Steve Stofka

In this last week of 2019, I’ll look way back for a bit of perspective heading into the coming election year. In 1932, voters elected FDR to the Presidency. More significantly, they elected an overwhelming majority of Democrats to the Congress to enable FDR to make big changes. Voters wanted an activist government to fix things.

$2.8 trillion is a lot of money, about 2/3rds of what the federal government spent in 2018 (CBO, 2019). That’s how much inflation-adjusted money depositors lost in bank failures during the Great Depression (Investopedia, n.d.). Imagine if ¾ of all the cash and money in checking accounts just vanished. That’s $2.8 trillion.

The Federal Deposit Insurance Corporation was created in 1933 to protect bank depositors from the loss of their life savings. During the 2008 Great Financial Crisis, Washington Mutual had losses of $307 billion. Depositors lost nothing. That’s activist government.

Republican advocate for a reactive rather than a proactive government – one that has a light regulatory hand. Too often this type of government ignores signs of trouble until a full-blown crisis develops like the 9-11 terrorist attacks or the Great Financial Crisis.

Voters will be asked to decide on which government role they prefer. Advocates for an activist government believe in grand communal solutions, many of which are poorly executed but are better than nothing. Cars, phones, computers and the social media that dominates our public policy discussions were all privately developed solutions that have adapted quickly to user demands. Government solutions are clunky contraptions of conceited ambitions that are slow to evolve as effective solutions. When they finally achieve some efficiency, the problem has changed. Examples include rent control, Social Security, Medicare, and the federal student loan program.

Advocates for a reactive government wait until the situation is near crisis levels, see that no one has created a solution yet and propose a public private partnership (PPP). These programs are not well designed to solve the problem but serve the purpose of funneling public tax dollars into private coffers while policy makers pontificate about free market solutions.  Examples are prisons, toll roads, and university student housing.

Presidents are usually elected for a second term. President H.W. Bush lost his bid for a second term in 1992 because of the lingering effects of a recession.  In 1980, President Jimmy Carter lost his bid for economic reasons as well. Divisions in the Democratic Party over the Vietnam War convinced an unpopular President Lyndon Johnson that he should not run for a second term in 1968. It’s unlikely that we will have a recession next year and that will increase the likelihood that Mr. Trump will be re-elected. Will that influence your financial decisions in any way?

The SP500 has gained 41% since President Trump took office in January 2017. Most of that gain has come in the past year. A record amount of money flowed into equity ETFs in December (Bell, 2019). Are investors chasing the high? Now is a good time for older investors to evaluate the risk-reward profile of their portfolio. An unpleasant task is to imagine what choices you might need to make if the value of your equity holdings were cut in half. That’s what happened in 2001-2002 and again in 2007-2009.  

97% of the U.S. is classified as rural but only 20% of the population lives there (Census Bureau, 2016). The map of the country may be colored a political shade of red, but there are relatively few voters per county. An ever-increasing portion of the people live in the scattered blue and politically purple areas. For decades the children who grew up in rural communities have left and not returned. The political fight for the direction of the country is not between rural and urban populations but between voters in smaller metro areas and suburban communities (Marema, 2019).

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Notes:

Bell, H. (2019, December 20). ETFs See Record $52B Inflows. [Web page]. Retrieved from https://www.etf.com/sections/weekly-etf-flows/weekly-etf-flows-2019-12-19-2019-12-13

Census Bureau. (2016, December 8). New Census Data Show Differences Between Urban and Rural Populations. [Web page]. Retrieved from https://www.census.gov/newsroom/press-releases/2016/cb16-210.html

Congressional Budget Office. (2019, June 18). The Federal Budget in 2018: An Infographic. [Web page]. Retrieved from https://www.cbo.gov/publication/55342

Investopedia. (n.d.). Bank Failures. [Web page]. Retrieved from https://www.investopedia.com/terms/b/bank-failure.asp

Marema, T. (2019, March 14). Contrary to What You Hear, the Rural-Urban Gap Didn’t Grow in 2018 Election. The Daily Yonder. [Web page]. Retrieved from https://www.dailyyonder.com/contrary-hear-rural-urban-gap-didnt-grow-2018-election/2019/03/14/

Majksner, Nikola. (n.d.). The Battle of Sutjeska Memorial Monument Complex in the Valley of Heroes, Tjentiste, Bosnia and Herzegovina. [Photo]. Retrieved from https://unsplash.com/photos/as_pS7EkK-Y

Mandates

November 10, 2019

by Steve Stofka

All states require that automobiles be insured. Would you support a state law that stipulated that you had to provide proof of insurance in order to start your car? It might be a card reader or a fingerprint reader that interfaces with an electronic interlock system. An insurance card might be a small chip on a key ring. Insert the chip, the car verifies the insurance and is ready to start.

 Some states already mandate such interlock systems called IIDs for drivers convicted of DUI and DWI offenses (McCurley, n.d.). In their implementation just laws can become unjust. A New York Times investigation recently revealed that the breathalyzers used by police are unreliable (Cowley, Silver-Greenberg, 2019). Thousands of cases have been thrown out because the machines were not calibrated and gave high readings. Some states have ignored or tried to cover up the inaccuracy of their tests.

The federal government has mandatory Social Security payments that we must pay when we work. States have mandatory sales taxes that must be paid when buying many goods and some services. Mandates are part of our everyday lives and yet people vociferously protested the Obamacare mandate to buy health insurance. Why? Working and buying things are activities that have some voluntary component. Obamacare’s mandate was on the activity of breathing, on being alive.

Some people resent jury duty for the same reason. People are called every few years where I live. For those who are unemployed, the reimbursement is small (NCSC, n.d.). In some states, jurors are paid about the same as convict labor. However, there is some choice. I can choose to move out of the district and avoid the frequency of being called. On the other hand, how do I avoid an Obamacare mandate on simply being alive?

Should young people be subject to mandatory national service of some kind? When I hear that suggestion, it usually comes from an older person. Younger people, who don’t make as much money earlier in their careers, will vote for mandates that older people making more money should pay higher taxes so that the government will be able to afford more services for younger people.

Retired people want mandates for those who are working to pay more money into the Social Security system so that retirees can be assured of getting their full pension checks. It is part of the human condition that we like mandates imposed on other people more than we like them imposed on us. We want more prisons but not in my neighborhood because that might drive property values down. We want more housing for the homeless but not in my neighborhood. I want to be charitable, but I have an obligation to protect my property values more than the homeless. We want more money for the poor and unfortunate but don’t want to pay higher taxes because we’re already taxed enough. Can’t the government get the taxes from the rich guys and leave me alone? Elizabeth Warren thinks so.

This year’s election was held last Tuesday and now we have a year of election festivities before the Presidential election in 2020. Among the Democratic contenders, Ms. Warren speaks with greater ease and confidence on the stage. She has policies and plans to pay for those policies and it’s the rich guys who are going to pay. I like that. I pay enough already. Ms. Warren fights for middle class families but she fights just as hard for the idea of big beneficial government, a variation of the philosopher king who rules his people with temperance, strength and charity.

President Trump is now the spokesman and leader of the Radical Right. Mr. Trump believes he is the philosopher king, immune from all laws while he is president. So his lawyer argued last week to a dumbfounded courtroom. Republicans believe in a philosopher king of another sort – the free market. This king rules with the wisdom of crowds, the temperance of competing interests and the strength of competition. That’s the idea at least. In practice the free market is not free. Politicians pass legislation to protect market interests from competition both domestic and foreign.

This coming election will feature candidates who have captured the extremes of either party yet claim that they represent the center. It is the other side that is radical. That’s the rhetoric we have been hearing from a radical Republican, leader Kevin McCarthy. “We’re normal. They’re crazy.” Welcome to the crazy ward at Congress, whose job approval ratings are in the low 20s (Real Clear Politics, n.d.). Why is that? Well, it’s because those crazy Democrats are trying to impeach our President and not getting anything else done. That’s one sentiment. However, Congressional approval ratings have improved since the Republicans held the House last year.

Every time I hear a politician say the phrase “the American people,” I know that I am about to hear utter nonsense following that phrase. They often profess to know and speak the will of the American people but few of them have the slightest clue or their job approval ratings wouldn’t be so low.

230 years ago, a large multinational company like the East India Company needed a powerful government like England to protect its interests and profits. This country fought a war against England to check the dominance of the East India Company. Today, Republicans openly support corporate interests over much else. Democrats say they are for the little guy, but they supported large financial institutions, big corporations and big unions during the financial crisis. They believe in big government; they need the support of big corporations to enact their big plans with their big government. The Senate minority leader, Chuck Schumer, hails from New York City and helped soften laws and regulations designed to curb Wall Street’s abuses.

The Radical Republicans believe in a form of anarchy that they call small government. Small, however, does not include military spending or subsidies to their friends and constituents. When Republicans spend big, it’s small government. When Democrats spend big, it’s socialism. We’ll get plenty of this nonsense in the coming year.

 The Radical Democrats keep insisting that this country is a democracy. No, it’s not. Look it up. The country was specifically founded on the principle that this was not a democracy. It was a republic. Shortly after the Constitution was written, the French Revolution vindicated the founders’ antipathy toward democracy. Democracies lead to either pandemonium or paralysis. In a democracy, the majority rule and inevitably enslave the minority. James Madison pointed to the institution of slavery to prove his case (Feldman, 2017). A republic of competing sectional interests would provide a better balance between warring factions within the new nation.

The Radical Republicans run against wind and solar subsidies because they are serving the interests of the oil and gas industries who have received direct and indirect subsidies for more than a hundred years. Businesses which dominate market share in an industry generously support their friends in Congress. There was no free market 200 years ago, there is no free market today and there won’t be one 150 years in the future.

Adam Smith published the Wealth of Nations the same year as the signing of the Declaration of Independence. The free market was an ideal that Adam Smith proposed after detailing the corruption that people and governments bring to any market. He didn’t like the idea of a free market but saw no better alternative. In his day, mercantilism dominated the economic and political system. Governments competed to protect the industries in their country against competitive pressures from those same industries in other countries.

These are our choices for next election: two philosopher kings. The big benefits of a strong, wise and caring government vs a market that can be efficient, just and cruel, that rewards effort and innovation but leaves many of the unprotected in despair. Those who don’t like mandates will vote for the market because they reason that markets can’t pass laws and mandates. Not directly, that’s true. However, dominant businesses try to get government to pass mandates which protect their profits. In either case, we are going to get mandates.

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Works Cited:

Cowley, S. and Silver-Greenberg, J. (2019, November 3). These Machines Can Put You in Jail. Don’t Trust Them. N.Y. Times. Retrieved from http://www.nytimes.com

Feldman, N. (2017). Three Lives of James Madison: genius, partisan, president. [Print]. New York: Random House.

McCurley, J. (n.d.). Ignition Interlock Devices: Costs and Requirements. [Web page]. Retrieved from https://dui.drivinglaws.org/interlock.php

National Center for State Courts (NCSC). (n.d.). Jury Management: State Links. [Web page]. Retrieved from https://www.ncsc.org/Topics/Jury/Jury-Management/State-Links.aspx?cat=Juror%20Pay

Photo by Willian B. on Unsplash

Real Clear Politics. (n.d.). Congressional Job Approval. [Web page]. Retrieved from https://www.realclearpolitics.com/epolls/other/congressional_job_approval-903.html

Jobs Affect Elections

September 15, 2019

By Steve Stofka

“It’s the economy, stupid,” James Carville posted in the headquarters of Bill Clinton’s 1992 Presidential campaign. The campaign stayed focused on the concerns of middle and working- class people who were still recovering from the 1990 recession. Jobs can make or break a Presidential campaign.

Each month the BLS reports the net gain or loss in jobs and the unemployment rate for the previous month. These numbers are widely reported. Weeks later the BLS releases the JOLTS report for that same month – a survey of job openings available and the number of employees voluntarily quitting their jobs. When there are a lot of openings, employees have more confidence in finding another job and are more likely to quit one job for another. When job openings are down, employees stick with their jobs and quits go down as well.

President Bush began and ended his eight-year tenure with a loss in job openings. Throughout his two terms, he never achieved the levels during the Clinton years. Here’s a chart of the annual percent gains and losses in job openings.

As job losses mounted in 2007, voter affections turned away from the Republican hands-off style of government. They elected Democrats to the House in the 2006 election, then gave the party all the reins of power after the financial crisis.

As the 2012 election approached, the year-over-year increase in job openings slowed to almost zero and the Obama administration was concerned that a downturn would hurt his chances for re-election. As a former head of the investment firm Bain Capital, Republican candidate Mitt Romney promised to bring his experience, business sense and structure to help a fumbling economic recovery. The Obama team did not diminish Romney’s experience; they used it against him, claiming that Romney’s success had come at the expense of workers. The story line went like this: Bain Capital destroyed other people’s lives by buying companies, laying off a lot of hard-working people and turning all the profits over to Bain’s fat cat clients. The implication was that a Romney presidency would follow the same pattern. Perception matters.

In the nine months before the 2016 election, the number of job openings began to decline. That put additional economic pressure on families whose finances had still not recovered following the financial crisis and eight years of an Obama presidency. Surely that led some working-class voters in Michigan, Wisconsin and Pennsylvania to question whether another eight years of a Democratic presidency was good for them. What about this wealthy, inexperienced loudmouth Trump? He didn’t sound like a Republican or Democrat. Yeah, why not? Maybe it will shake things up a bit.  Enough voters pulled the lever in the voting booth and that swung the victory to Trump.

In the past months the growth in job openings has declined. Having gained a victory based partially on economic dissatisfaction, Trump is alert to changes that will affect his support among this disaffected group. As a long-time commentator on CNBC, Trump’s economic advisor, Larry Kudlow, is aware that the JOLTS data reveals the underlying mood of the job market. Job openings matter.

Unable to get action from a divided Congress, Trump wants Fed chairman to lower interest rates. There have been few recessions that began in an election year because they are political dynamite. The recession that began in 1948 almost cost Truman the election. The 1960 recession certainly hurt Vice-President Nixon’s bid for the White House in a close race with the back-bench senator from Massachusetts, John F. Kennedy.

In his bid to unseat President Carter in 1980, Ronald Reagan famously asked whether voters were better off than they were four years earlier. The recession that began that year helped voters decide in favor of Reagan.

Although the 2001 recession started a few months after the election, the implosion of the dot-com boom during 2000 certainly did not help Vice-President Al Gore’s run for the White House. It took a Supreme Court decision and a few hundred votes in Florida to put Bush in the White House.

As I noted earlier, George Bush began and ended his eight years in the White House with significant job losses. Those in 2008 were so large that it convinced voters that Democrats needed a clear mandate to fix the country’s economic problems. After the dust settled, the Dems had retained the house, won a filibuster-proof majority in the Senate and captured the Presidency. Jobs matter.

The 2020 race will mark the 19th Presidential election after World War 2. Recessions have marked only four elections – call it five, if we include the 2000 election.  An election occurs every four years, so it is not surprising that recessions occurred in only 25% of the past twenty elections, right? It’s not just the occurrence of a recession; it’s the start of one that matters.

Presidents and their parties act to fend off economic downturns with fiscal policy or pressure the Fed to enact favorable monetary policy that will delay downturns during an election. Trump’s method of persuasion is not to cajole, but to criticize and denigrate anyone who doesn’t give him what he wants, including the Fed chairman. To Trump, life is a tag-team wrestling match. Chairman Powell can expect more vitriolic tweets in the months to come. Trump will issue more executive orders to give an impression that his administration is doing something. The stock market will probably go up. It usually does in a Presidential election year.

Optimism Reigns

Dec. 11, 2016

For the second week since the election the SP500 index rose more than 3%, reversing a slight loss the previous week.  The SP500 has added 160 points, or 7.6%, in total since the election.  Barring some surprise, the market looks like it will end the year with a 10+% annual gain, all of it in the 6 – 7 weeks after the election. Small cap stocks have risen 17% in the past five weeks.  Buoyed by hopes of looser domestic regulations, and that international capital requirements will be relaxed, financial stocks are up a whopping 20% in the same time.

Having held their Senate majority, Republicans now control both branches of Congress and the Presidency but lack a filibuster proof dominance in the Senate.  They are expected to pass many measures in the Senate using a budget reconciliation process that requires only a simple majority. The promise of tax cuts and fewer regulations has led investment giants Goldman Sachs and Morgan Stanley to increase their estimate of next year’s earnings by $8 – $10.  Multiply that increase in profits by 16x and voila!  – the 160 points that the SP500 has risen since the election.  The forward Price Earnings ratio is now 16-17x.

Speculation is about what will happen.   History is about what has happened. The Shiller CAPE10 PE ratio is calculated by pricing the past ten years of earnings in current year’s dollars, then dividing the average of those inflation adjusted earnings into today’s SP500 index.  The current ratio is 26x, a historically optimistic value.  The Federal Reserve is expected to raise interest rates at their December meeting this coming week.

As buyers have rotated from defensive stocks and bonds to growth equities, prices have declined.  A broad bond index ETF, BND, has lost 3% of its value since the election.  A composite of long term Treasury bonds, TLT, has lost 10% in 5 weeks.  For several years advisors have recommended that investors lighten up on longer dated bonds in anticipation of rising interest rates which cause the price of bond funds to decline.  For 6 years fiscal policy remedies have been thwarted by a lack of cooperation between a Democratic President and a Republican House that must answer to a Tea Party coalition that makes up about a third of Republican House members.  The Federal Reserve has had to carry the load with monetary policy alone.  Both former Chairman Bernanke and curent Chairwoman Yellen have expressed their frustration to Congress.  If Congress can enact some policy changes that stimulate the economy, the Federal Reserve will have room to raise interest rates to a more normal range.

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Purchasing Manager’s Index

The latest Purchasing Manager’s Index (PMI) was very upbeat, particularly the service sectors, where employment expanded by 5 points, or 10%, in November.  There hasn’t been a large jump like this since July and February of 2015.  For several months, the combined index of the manufacturing and service sector surveys has languished, still growing but at a lackluster level.  For the first time this year, the Constant Weighted Purchasing Index of both surveys has broken above 60, indicating strong expansion.

The surge upward is welcome, especially after October’s survey of small businesses showed a historically high level of uncertainty among business owners.  This coming Tuesday the National Federation of Independent Businesses (NFIB) will release the results of November’s survey.  How much uncertainty was attributable to the coming (at the time of the October survey) election?  Small businesses account for the majority of new hiring in the U.S. so analysts will be watching the November survey for clues to small business owner sentiment.  Unless there is some improvement in small business sentiment in the coming months, employment gains will be under pressure.

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Productivity

Occasionally productivity growth, or the output per worker, falters and falls negative for a quarter.  Once every ten or twenty years, growth turns negative for two consecutive quarters as it has this year. Let’s look at the causes.  Productivity may fall briefly if businesses hire additional workers in anticipation of future growth.   Or employers may think that weak sales growth is a temporary situtation and keep employees on the payroll.  In either case, there is a mismatch between output and the number of workers.

During the Great Recession productivity growth did NOT turn negative for two quarters because employers quickly shed workers in response to falling sales.  The last time this double negative occurred was in 1994, when employment struggled to recover from a rather weak recession a few years earlier.  For most of 1994, the market remained flat.  In Congressional elections in November of that year, Republicans took control of the House after 40 years of Democratic majorities.  The market began to rise on the hopes of a Congress more friendly to business.  Previous occurrences were in the midst of the two severe recessions of 1974 and 1982.   As I said, these double negatives are infrequent.



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The Next Crisis?

The economies of the United States and China are so large that each country naturally exports its problems to the rest of the world.  The causes of the 2008 Financial Crisis were many but one cause was the extremely high capital leverage used by U.S. Banks.  A prudent ratio of reserves to loans is 1-8 or about 12% reserves for the amount of outstanding loans.  Large banks that ran into trouble in 2008 had reserve ratios of 1-30, or about 3%.

Now it is China’s turn.  Many Chinese banks have reported far less loans outstanding to avoid capital reserve requirements.  How did they do this?  By calling loans “investment receivables.”  It sounds absurd, doesn’t it?  Like something that kids would do, as though calling something by another name changes the substance of the thing.  70 years ago George Orwell warned us of this “doublespeak,” as he called it.  Reluctant to toughen up banking standards for fear of creating an economic crisis, the Chinese central bank is planning a gradual move to more prudent standards that will take several years.  However, it is a crisis waiting for a spark.  Here’s a Wall St. Journal article on the topic for those who have access.

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Election Volatility

November 13, 2016

Sometimes the hardest thing an investor can do is nothing.  That’s pretty much what a casual investor with a balanced portfolio should do in response to the election results.  With a portfolio of 57% stocks and 43% bonds and cash, my total portfolio has risen 1/2% this week, or much ado about nothing.  Let’s dig into this week’s election results and the market’s reaction.

Donald Trump, the President-elect, has long maintained that his campaign was a movement and was proved right this past Tuesday.  White voters from rural districts around the country rallied in strong numbers to Trump’s promise to straighten up Washington.

Voters generally want a change of direction after one party has occupied the White House for two terms and this election proved to be no different. In the modern era of politics, only H.W. Bush was able to gain a 3rd Presidential term for the Republican party in 1988 after two terms of Ronald Reagan.  Countering the emotion and momentum of the Trump movement on the right were the voters on the left who passionately turned out for Bernie Sanders in the Democratic primaries.  Voters and superdelegates chose the establisment candidate, Hillary Clinton.  Some say that the process and the rules favored Clinton over Sanders.  His supporters are convinced that Sanders could have beat Trump.  Movement against movement.

In the past decade, voters have expressed a preference for rallying cries, for mantras of momentum like “Si se puede!” (Obama), “Build the wall!” (Trump) and “Medicare for all!” (Sanders).  Candidates must learn to condense their message into a short slogan that can be easily waved.  McCain, Romney and Clinton never found a verbal cadence that would act as a catalyst for voters to enthusiastically join the parade.  Sarah Palin, McCain’s Vice-Presidential candidate in 2008, understood the need for slogans.

 Note to future Presidential candidates who would like to actually win:  criticize the candidate, not that candidate’s supporters.  Hillary Clinton made the same mistake that Romney made in the 2012 election – disparaging their opponent’s voters.

Election night.  As a Trump victory became increasingly probable, global markets began to sell risk (stocks) and buy safety (bonds).  In the early morning hours after the polls closed, the networks called the state of Wisconsin for Donald Trump and put him over the threshold of 270 votes in the Electoral College.  Several  minutes later, about 2:45 AM on Nov. 9th, we learned that Hillary Clinton  had called Donald Trump to concede and wish him luck.  Dow Futures were down about 4% at that point.  Japan’s stock market was down 5.5%.  The yield on the 10 year Treasury note was down 7.22%, meaning that the price was up about 8% as investors in world markets were seeking the safety of U.S. debt.  Emerging markets fell in anticipation of protectionist trade policies under a Trump administration.

About 3 A.M.  President-elect Trump began to give a sedate and rational acceptance speech that began with a gracious nod to Hillary Clinton’s fight.  He spoke of unity, healing and more importantly, infrastructure spending and tax cuts.  With control of the Congress and Presidency in Republican hands, there was real hope that Washington could end the years of stalemate and finally implement fiscal policy to rescue a economy that had been kept afloat by an exhausted monetary policy for six years.

The overseas markets began to turn around.  By the time U.S. markets opened more than six hours later, stocks and Treasuries had reversed.  Stocks were now off less than 1/2% and Treasury prices were down severely.  TLT, a popular ETF for long term Treasuries, opened about 2% lower, a price swing of 10%.  EEM, a composite of Emerging Market stocks, opened up almost 3% down and lost ground during the trading session.  By week’s end the SP500 had risen 3.8% for the week, and EEM had fallen by that same percentage.

This week’s action in the bond market was a good example of the mechanics of bond pricing so let’s look at the price action and what it says about the future guesses of the direction and extent of interest rates.  First, bond prices move inversely to interest rates.   The extent that these prices move is measured by a bond’s duration.  Here is a link to the iShares page for the TLT ETF on long term Treasuries.  I have captured a section of the page with the duration highlighted.

If you have a bond fund, the mutual fund company will state the bond duration as well.  What does this tell you?  Leverage.  Duration tells you the approximate change in price for a 1% change in interest rates.  In this case, a 1% increase in interest rates will generate about a 17% decrease in price.  Because TLT is a composite of long term Treasuries, its price is more sensitive to changes in interest rates, or the consensus on interest rates six months to a year in the future.  The price of TLT fell 7.4% this week as traders repriced future interest rates.  With some grade school math, we can calculate what traders are guessing interest rates will be a half year to a year from now.

The Fed last raised rates at the end of 2015, putting them at approximately 1/4% – 1/2%.  In July, the price of this ETF was about $142.  It closed this week at $122, a decline of 14% from the summer high. Now we divide the 14% by the bond’s duration of 17.41% to get a ratio of .80.  This is the new guess of how much interest rates are likely to rise – approximately 3/4% – 1%.  By the fall of 2017, traders are betting that the benchmark Fed interest rate will be about 1.25% to 1.5%.

Let’s look at a more balanced composite bond ETF that financial advisors might recommend for casual investors.  Vanguard has a more conservative composite ETF whose ticker symbol is BND, with a duration of 5.8, about a third of the TLT ETF. (Spec Sheet here)  This week BND lost almost 2% and is down almost 4% from its summer high.  When we divide 4% by 5.8% (the duration in percentage terms) we get a guess of about a .7% raise in interest rates.  Because BND contains shorter term bonds, this guess is slightly below that of TLT.

Why are traders betting on more aggressive interest rate increases after Donald Trump was elected?  He has spoken about infrastructure spending and tax cuts, two fiscal stimulus programs that will likely spur inflation upward.  With a Republican party that has control of the Presidency and both houses of Congress, these measures are likely to be passed in some form.  Some sectors of the economy will likely benefit from more infrastructure spending so they rose this week.  Shares in technology giants like Apple and Google fell as traders switched money among sectors but are still up by healthy margins since February lows.

Let’s say that next March comes and the Trump White House and the House Budget Committee can not come to terms on either of these programs.  Investors would likely reprice interest rate expectations and lower them, causing the price of bond ETFs or mutual funds to rise.

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Miscellaneous Election Notes

I’ll share a distinction that NPR’s David Folkenflik made this week.  Those on the left took Donald Trump literally, but not seriously.  Those who voted for him took him seriously, but not literally.

During Thursday’s trading the Mexican peso fell to 15.83 per dollar, the lowest since 1993 when Mexico reset their currency. Why the big drop?  Trump has repeatedly said that he would cancel the NAFTA agreement that binds Mexico, Canada and the U.S.  The NAFTA agreeement requires only a 6 month notification before termination.  There is some disagreement whether the White House would need Congressional approval to cancel NAFTA which might delay the action.  Some in the Republican party like free trade agreements and are likely to put up a fight.  Some analysts think that the devaluation of the peso could lead to a recession in Mexico, which was already under economic pressure due to falling oil prices.

131 out of 231 million registered voters cast their vote in this election, slightly below the voter total in the 2008 election. (538)  Trump and Clinton each took 26% of registered voters.

The Trump White House can reverse Obama’s executive action on the Keystone pipeline and re-initiate construction.  It will likely amend or repeal tentative proposals to mitigate climate change.

Why did pre-election polls get it so wrong?  According to Pew Research, more than a third of households would respond to a survey a few decades ago.  Now it is only 9%.  Statisticians must tweak this rather small sample to make it more representative of the population as a whole.  A particular demographic constituent in the sample – say white working class men – might be underrepresented in the survey.  Survey methodology then gives the opinion of relatively few sample respondents more weight than it actually has in the general voter population.

Some statisticians recommend using economic and demographic algorithms to gauge future election results based on actual past voting records.

Of the 700 counties that voted for Obama in 2012, a third of those voted for Trump in 2016.  Polls indicated that Hillary Clinton would capture the majority of the white college-educated vote for the first time in decades but she failed to do so.  More white voters voted for Obama than Hillary.

A third of Democrats in the House come from just three states:  California, New York and Massachusetts.  This concentration may answer to the concerns of those states but indicates that the party has become out of touch with the voters in many states.

Each time a Democratic candidate is elected President, unfounded rumors circulate that the new President will take away people’s guns.  People rush out to buy guns.  Trump’s surprise win caused the stock of gun maker Smith and Wesson to decline 22% in a couple of days.

On the other hand, many women feared that Trump and a Republican Congress would restrict birth control and stocked up in the days after the election. Here is a map of abortion regulations in the states before the 1972 Supreme Court’s decision in Roe v. Wade.  Abortion was more permitted in the southern states than the northeast states.

Here‘s a state-by-state breakdown of the vote from NPR.