Once upon a time, long, long ago in a land far away, investors bought stocks in companies they thought had good products or services and good management, and kept them for months or years to reap the profits from the companies' successes. No more. All it takes is 280 characters from Donald Trump or some obscure indicator to change a bit and everyone runs for the hills. In unison.
When Trump tweeted that he was going to impose a 10% tariff on all imports from China, markets nosedived. Then he tweeted that he would delay some of those for a few months and they zoomed up. Yesterday, they tanked again. The cause this time was that the yield curve is inverted (but only slightly). What a bunch of snowflakes. The Dow was down 800 points yesterday and the S&P 500 index was down 86 points. It was the worst day of 2019, but if recent history is a guide, the markets will bounce back today.
"What is an inverted yield curve?," you might ask. Well, normally, if you lend some money to the government for 10 years, you get a better interest rate than if you lend it for only 2 years. As of yesterday, the reverse was true: 2-year treasury notes are paying more than 10-year bonds, which suggests pessimism about the short-term prospects of the U.S. economy. This is the "inverted yield curve." In the past, inverted yield curves have generally preceded recessions, sometimes by almost 2 years, but every recession is different. It is the fear of a possible recession that is causing the flight from stocks.
However, it is important to note that nothing much changed in the actual economy yesterday. What happened is that many investors think a recession is coming, and don't want their bonds to mature right in the middle of it. But the fact that investors think a recession is coming and run for the hills doesn't mean it actually is coming, except to the extent this is a self-fulfilling prophecy. If business leaders think a recession is coming (because they read the papers and see that investors think it is coming), they may expand their businesses less, lay off people, etc. If enough companies do this, then we do get a recession in reaction to the investors, who, in fact, have no secret knowledge about where the economy is headed.
Naturally, Trump praised the inverted yield curve by saying how optimistic investors are, even though it actually means the exact opposite. Needless to say, he wants to jawbone the economy upwards. If it tanks next year, he is almost certain to be a one-term president. That is why he is also putting pressure on the Fed to cut interest rates. The theory is that when interest rates are low, companies will borrow and expand their businesses. However, if the CEOs think a recession is coming and they won't be able to sell any more products or services on account of that, they won't expand, no matter how cheap loans are.
What could also be a factor in the stock market's nervousness is the ongoing trade war with China. Yesterday, Commerce Secretary Wilbur Ross didn't improve matters when he said that the U.S. and China are not talking now and no date has been set for talks to resume. Chinese President Xi Jinping doesn't want a recession, but he also doesn't have to face an election next year, so he is fully prepared to wait Trump out. Chinese leaders tend to take a long view of history and don't think much about the next fiscal quarter or the next year so much. Once, when former Chinese leader Zhou Enlai was asked in 1972 what he thought about the French Revolution, he allegedly said: "It's too early to tell." Even if that quote is apocryphal, it's caught on because it captures something about the worldview of the Chinese people. (V)
Most of Joe Biden's many gaffes are harmless enough, but once in a while he says something that really upsets some people. In the July 31 debate, he said that undocumented immigrants should "get in line" and that the country should cherry-pick potential immigrants for their skills. Latino groups went bananas over this, saying that those are Republican talking points. Among other things, they say there is no line to get in back of and that deemphasizing family reunification in favor of allowing high-skilled immigrants in has a racial component to it.
Other Democrats lost no time in coming after Biden as well. For example, Sen. Cory Booker (D-NJ) said: "It really irks me because I heard the vice president say that if you got a Ph.D., you can come right into this country. Well, that's playing into what the Republicans want, to pit some immigrants against other immigrants."
Biden heard the message and is now trying to dig himself out of the hole he dug himself into. His senior adviser for Latino affairs, Cristóbal Alex, fielded hundreds of calls from angry Latino activists, but nonetheless said: "I wouldn't say we're putting out fires or dealing with fallout." Actually, putting out fires and dealing with fallout is exactly what he was doing. The candidate himself is talking to Latino leaders all over the country in an attempt to convince them that he meant well. The real problem is that the best position for the primaries is "family reunification first" but the best position for the general election is "high-skilled workers first." Consequently, the problem is not going to go away by itself. (V)
House Democrats asked D.C. District Court Judge Beryl Howell to link two cases they have brought. The first one is one trying to compel former White House Counsel Don McGahn to testify before the House Judiciary Committee. The second one is about getting access to former special counsel Robert Mueller's internal files. The judge said nope, as the two cases are not really connected. As a result, the McGahn case will be assigned to Judge Ketanji Brown Jackson, an Obama appointee. Howell, also an Obama appointee, will keep the Mueller case. (V)
According to the New York Times, four Democrats in the know have told the Times that John Hickenlooper has seen the handwriting on the wall and it says: "Forget this president thing, you dolt. Run for the Senate." Hickenlooper is going nowhere in the presidential race, and probably won't even qualify for the third debate. That would be the end of him, so he's reportedly going to throw in the towel sometime today and spare himself the black eye.
What's next for him? Well, Sen. Cory Gardner (R-CO) is probably the most vulnerable Republican senator up in 2020 and Hickenlooper is a popular former two-term governor of Colorado. If Hickenlooper does what he should have done on day 1, namely run for Gardner's seat, he would instantly become the favorite, both in the primary and in the general election.
Democrats need to flip three GOP Senate seats to get to 50, assuming they don't lose any of their own. Colorado could be one of them. Another could be Montana. If Gov. Steve Bullock (D-MT) also sees the light, he could switch to the Senate race there and give Sen. Steve Daines (R-MT) a good fright. Finally, there is Beto O'Rourke. He came close to beating Sen. Ted Cruz (R-TX) in 2018 and many Democrats want him to be the one to flip the third Republican seat by taking on Sen. John Cornyn (R-TX). If all three Democrats go for the Senate races, it reduces the crowded presidential field and also gives the Democrats a plausible path to take control of the Senate. The blue team also has excellent chances in Arizona, with former astronaut Mark Kelly challenging Sen. Martha McSally, in Maine, where Sen. Susan Collins (R-ME) has angered many people on account of her vote for Justice Brett Kavanaugh, and in North Carolina, where the first poll of the race has incumbent Sen. Thom Tillis (R-NC) down by 7 points to State Senator Erica Smith. (V)
Yesterday, we had an item showing polling of Donald Trump vs. the Big Five Democrats, both nationally and in three individual states. All the leading Democrats except Pete Buttigieg beat Trump nationally, and Joe Biden and Sen. Bernie Sanders (I-VT) even beat him in Texas and North Carolina. We also had another item on the direction of the country. Put bluntly, large majorities think it is heading in the wrong direction. That is never good for an incumbent.
Today we have another way of looking at the 2020 general election: Trump's state-by-state approval ratings. Asking people if they approve of the president isn't a sure-fire way to determine how they will vote, as a substantial number of people who disapproved of Trump voted for him in 2016 because they positively hated Hillary Clinton. Still, candidates rarely get more than a few percent more votes than their approval rating because people don't like voting for someone they disapprove of. It has to be a "lesser of two evils" situation before a candidate can run much above his approval rating.
That said, a poll of registered voters from Civiqs on Trump's approval rating in all 50 states and D.C. should give the president's campaign team some indigestion. If each state where Trump is above water in terms of approval were to vote for him and each state where he was underwater were to vote for the generic Democrat, this is what the electoral college map would look like:
The result of this map is 419 electoral votes for the Democrat and 119 for Trump. Among other things, the map shows that Trump would lose 10 states that he won in 2016: Arizona, Florida, Georgia, Iowa, Michigan, North Carolina, Ohio, Pennsylvania, Texas, and Wisconsin. We are still skeptical about Texas turning blue (although the Democrats have a decent shot at picking off a few suburban congressional seats there). Utah is almost as unlikely as Texas to flip. Also, Georgia is definitely a reach. Arizona, North Carolina, and Florida are probably going to be very competitive. But the main takeaway here is that Trump could lose the entire Upper Midwest, in which case he would be toast, no matter what happens in the competitive states. In particular, Trump is underwater by 12 points in Pennsylvania, 11 in Michigan, and 9 in Wisconsin. Also, Democrats won gubernatorial and senatorial races in all three states in 2018.Nevertheless, there are a few footnotes here, the major ones being: (1) Who is Civiqs?, (2) this is an online poll, and (3) the election is 15 months away. And, of course, the general election campaign hasn't started and we don't know who the Democratic nominee will be. Depending who it is, we could have an ageist, racist, and/or homophobic campaign from Trump, for example:
Of course, none of this is remotely true, but Trump has already made over 12,000 false claims in 3 years, so what's a few more? In any event, we can be sure that Trump will not run on his legislative achievements because the main one (the tax cut) isn't all that popular. So we have to assume he will run an ugly campaign trying to make people afraid of whomever the Democrats nominate. Could it work? Time will tell. (V)
California just passed a law requiring candidates for president and governor to release years of tax returns to get on the primary ballot. The law is already being challenged in court. If it survives these challenges, it is very unlikely that Donald Trump will release his tax returns just to get on the California ballot. He knows that he won't need the state's delegates to claim the Republican nomination. Nevertheless, the law could have some real consequences. First, some other Republicans are likely to file and win delegates to the Republican National Convention, possibly to stir the pot a bit.
Second, and more important, with no Republican primaries for president, governor, or senator, many Republicans may not bother to show up to vote in the March 3rd primaries. Eight months later, they may be sorry. In 2010, California decided that Louisiana had it right, chucked its old partisan primary system, and adopted a jungle primary (although slightly different from Louisiana's). If Republican turnout in California on March 3, 2020 is way down, in some competitive congressional and legislative races, the top two finishers may both be Democrats. Those two would face off in the November general election. It has already happened quite a few times that the general election candidates in some races, including Sen. Kamala Harris' run for the Senate,are both Democrats. This could mean that Democrats would pick up congressional and state legislative seats that are normally Republican. Republican strategists are already very worried about this possibility, but there is little they can do about it other than pray the tax-return law is overturned.
Currently seven congressional districts are represented in Congress by Republicans as follows:
These are all fairly red districts, but that is beside the point. Suppose few Republican voters bother to vote in the primary because there are no high-profile statewide races and they think their representative has a lock on the GOP nomination. Also suppose that Democrats show up in droves, primarily to vote in the hotly contested presidential primary. Then it could happen that two of the Democrats running in the local House race each get more votes than the Republican incumbent, and both advance to the general election. Then, with no Republican on the November ballot, some Democrat will be elected to Congress in a very red district. Democratic state senators and Assembly members undoubtedly realize this, so we can expect a fair number to run for House seats that would normally be unobtainable. The Republicans' big hope has to be that 5 or 10 Democrats jump into each House race and split the vote so badly that the incumbent Republican finishes in the top two. (V)
Speaker Nancy Pelosi generally isn't into name-calling, but yesterday she broke with tradition and referred to Senate Majority Leader Mitch McConnell (R-KY) as "Moscow Mitch." Her beef with him is that the House passed legislation to try to reduce Russia's impact on the 2020 election, but McConnell won't let it come up for a vote in the Senate.
McConnell didn't take this lying down. He described the use of the moniker "Moscow Mitch" as "modern day McCarthyism." He is also none too happy about an op-ed former Republican congressman Joe Scarborough published in the Washington Post entitled "Mitch McConnell is a Russian asset."
McConnell has also come under fire for refusing to take up bills banning high-capacity magazines for assault weapons and universal background checks for gun purchasers. It is unlikely that a few op-eds and name calling are going to change his mind on any of this, though they will certainly provide much fodder for the Democrat who is going to challenge him in 2020, Amy McGrath. (V)
Have you ever been to Clear Lake, IA? Have you ever even heard of it? If you are of a certain age and know about the history of Rock 'n' Roll music, you might recall that Clear Lake was where the Big Bopper, Buddy Holly, and Richie Valens played their final show before getting on that doomed charter plane that crashed in a snowstorm killing all three of them on the day the music died. But now Clear Lake, and other towns in Iowa, are getting more attention as political junkies from out of state are visiting the first-in-the-nation Hawkeye State to be part of the political circus starting to happen there and meet some of the candidates. Better than driving your Chevy to the levee, only to find that the levee is dry.
The Iowa State Fair was a big draw for political tourists, even for people who aren't interested in looking at butter cows or eating pork chops on a stick. Most of the Democratic presidential contenders were there and getting a selfie with someone who might become president of the United States on Jan. 21, 2021, was a realistic possibility. Tourism is an $8.5 billion industry in Iowa, so state officials don't mind the influx of political tourists at all. They stay in local hotels, eat in local restaurants, and buy local souvenirs, so it helps the Iowa economy, which needs all the help it can get now on account of Donald Trump's trade war with China and the Chinese response to it, namely to stop buying American agricultural products.
Some of the political tourists have family in Iowa, and a number of them showed up to meet their kin and were horrified to learn that their brother or aunt or cousin, or whoever voted for Donald Trump in 2016, which obviously many of them did since he carried the state by 10 points in 2016. Maybe the out-of-staters will end up as de facto anti-Trump campaigners. Once the fall begins and school starts, political tourism in Iowa (and the other early states) will drop off, but will probably pick up again in the weeks before the actual caucus and primary voting begins. (V)
Today, we begin with questions about how Donald Trump does what he does.
You've frequently written that nothing seems to stick to President Trump for very long. Why do you think that is the case? Why is he able to shake off gaffes, missteps, and scandals that would've seriously wounded, if not destroyed, other politicians? J.B., Philadelphia, PA
We're going to start with two relatively non-controversial answers to your question. First, Trump discovered that Richard Nixon was really on to something with his description of a "silent majority" of Americans. The idea, which actually predates Nixon by about 50 years (he just named it), was that there are many Americans whose viewpoints are not well represented in mainstream political and cultural discourse. In the context of the 1960s, Nixon was specifically arguing that the anti-Vietnam War protesters spoke only for a small minority of the citizenry. More obliquely, he was suggesting that anti-civil-rights sentiment was still fairly widespread.
Since Nixon's time, many Republicans have made thinly veiled racism a part of their campaigns. And when it wasn't that, it was often some other bigotry (like homophobia, which helped power George W. Bush to victory in 2004). However, the assumption that Ronald Reagan, the Bushes, etc., operated under was that such ideas only motivated a segment of the electorate, and were a turn-off to the rest. This is why they were communicated in the form of dog whistles or indirect attacks (e.g., "we're not anti gay, we're just anti gay marriage"). What Trump stumbled onto is that the segment of the population that is "silent" about their highly phobic views on things like race, and immigration, and Islam may not be a majority, but is larger than past GOP presidential candidates imagined—just enough to win a national election.
The other non-controversial secret of Trump's "success" is that he created the political version of what computer scientists call a denial-of-service attack, or what lawyers call paper terrorism, or what debaters call a Gish gallop. The general idea here is that a particular system is set up to handle a certain amount of information. However, if you overload the system with vastly more information than it's meant to handle, it ceases to function properly (or it may cease to function at all).
The American political system is set up pretty well to process, and even punish, the occasional baldfaced lie or corrupt act or incompetent decision by a politician. What Trump has done, presumably by instinct rather than any pre-conceived plan, is overload the country with so many lies, and so many bad acts, that it's just not possible to stay on top of them. Consider this list of controversial developments, which all happened in one week:
It's a staggering list—enough to keep any other president in hot water for at least a year. And these are only the things we did an item about, and do not include his garden-variety lies and his regular outrageous tweets. But most remarkable of all, perhaps, is this: Do you know how long ago Trump compiled this list? About five weeks ago (it was the week of Jun. 24 - Jul. 1). Doesn't it seem like much longer than that? That's because Trump has produced enough items for four or five more lists like this one since then.
So, that's the two fairly non-controversial answers. Now on to the much more provocative one. Consider another list:
We suspect that, at this point, a lot of readers have guessed where this is headed. For those who haven't, these are among the classic warning signs that indicate the existence of a cult. Now, "cult" and "not a cult" is not a binary thing; it's a spectrum. And Trump and his base are not nearly as far along the spectrum as, say, the Branch Davidians, or the Peoples Temple, or the Death Eaters, or Dallas Cowboys fans. But they surely are somewhere on the cultish end of the spectrum, which means that when it comes to his supporters, Trump is actually speaking truth when he declares: "If the president does it, it's not wrong."
I recently viewed The Great Hack on Netflix, detailing the reach of Cambridge Analytica deep into our personal lives and using that info to influence elections and other public policy issues. Or, more appropriately, manipulating people and making us unwitting pawns in their political game. It's infuriating, and yet Brad Parscale, via Twitter, proudly affirmed his role and promised the 2020 campaign to be "even bigger, better, and badder than before." This in-your-face boasting of unethical behavior gets the base fired up and I just don't get it. Trump supporters now casually admit to Russian interference in our elections and they see nothing wrong with it. It's just "politics as usual." So, is it really unethical, or is it just me? Has the public perception of unethical shifted so drastically? J.S., Dayton, NJ
The second part of the previous answer was pretty provocative, so let's keep going in that direction. We would suggest that Trump and his underlings are perpetrating a massive, nationwide campaign of gaslighting. That term, which comes from the 1944 film Gaslight, describes a form of manipulation that causes people to question (and often change) their perception of reality.
Here's one more list (the last of the day, we promise). It is from Psychology Today and describes the clues that someone is gaslighting you:
Normally, gaslighting is a one-on-one phenomenon, but Trump is doing it on a macro level, and so blatantly that people are already writing books about it.
The answer to your question, then, is that there is all kinds of unethical stuff going on, both within the White House and as part of the Trump 2020 campaign. Ethical standards have not changed so radically, and if something seems wrong, it probably is. But if you're questioning your own standards at all, well, that's not too surprising because you've been getting gaslighted on a near-daily basis for three years.
The 2020 election is, deservedly, soaking up most of the punditry's ink. But are there any important races to watch for the 2019 off-year elections? V.B.G., Decatur, GA
Yes, there are a few. To start, at least two House seats will be contested (more, if any other Representatives die, resign, or are expelled). On Sept. 10, voters in NC-03 and NC-09 will head to the polls, in the former because Walter Jones died and in the latter because the 2018 result was thrown out due to ballot fraud. Jones' former district is R+12, and so is likely (but not guaranteed) to stay in GOP hands. NC-09 is R+8 and, because of the chicanery, may well flip to the Democrats.
There are also three gubernatorial elections this year. In Kentucky, Gov. Matt Bevin (R) will try to fend off a challenge from Attorney General Andy Beshear. Kentucky is pretty red, but it does elect Democrats to statewide offices sometimes, and Bevin has some liabilities. So, the blue team could prevail here; if they do, then Mitch McConnell will start to get very nervous. In Louisiana, John Bel Edwards (D) will try to hold on to the governor's mansion that he won primarily because his 2015 opponent, David Vitter, was too shady for Louisiana voters (which is really saying something). Bel Edwards' approval is hovering around 50%, so he might pull it off, but don't bet too much on him. And finally, in Mississippi, Phil Bryant (R) is term-limited. At the moment, Attorney General Jim Hood (D) is waiting to see who comes out of the nasty GOP primary. Hood is an underdog, but much less of one than Mississippi's deep red color might suggest. Louisiana will hold its election on Oct. 12, with a runoff on Nov. 16 if nobody clears 50%. The other two states will head to the polls on Nov. 5.
Three statehouses will also be contested this year. Republicans will surely maintain control of both chambers in both Louisiana and Mississippi. However, Virginia will be very interesting, as the Democrats need only gain one seat in the State Senate and two in the State House to have the trifecta in the state (governor, both houses of the legislature). Virginians will also head to the polls on Nov. 5.
There is also a large number of mayoral elections, and quite a few Native American tribes are voting for their leaders this year, but most of those contests are primarily of local interest.
I see that Morning Consult consistently ranks Bernie Sanders above Elizabeth Warren, and consistently beyond the supposed 4% margin of error. YouGov does the opposite. Today, there is a poll from Gravis that puts Sanders in first place in New Hampshire, again with more than 4%. This can only be a consequence of using different models of the electorate and having different polling methodologies. I assume nobody really knows the "right" way—otherwise everyone would be doing it. I conclude, then, that comparing YouGov vs SurveyUSA vs Morning Consult polls are pointless. But within each model, comparisons have some validity, have some indication of trends, no? D.A., Brooklyn, NY
You're right that different houses use different models that can produce somewhat different results. However, we don't think that makes a YouGov poll and a Gravis poll apples and oranges. We think it makes them different flavors of apples. And indeed, we would say that your argument is why polls from different houses should be compared, not why they shouldn't be. Since we cannot know who has the secret sauce, we look at the polls in aggregate, to get a more rounded picture. This is why, on this site, we often present as many nonpartisan polls as we can. Any one poll can easily be an outlier, but if five or six polls show the same basic thing, that is generally instructive.
The fundamental problem is that no one knows how many millennial or black or Latino or other voting groups with a less-than-stellar voting record will vote. That matters a lot, and YouGov and Morning Consult may simply be making different guesses. There is no way now to tell if either is right. And we also don't know if the models used by Quinnipiac or Marist or anyone else is right, either. The best we can do is average and hope for the best.
What we're essentially arguing for, here, is a polling version of what is called the wisdom of the crowd. The general idea is that there is "noise" in any one judgment (or poll), but that if you put a whole bunch of them together, the noise gets cancelled out.
Does anyone have a service/survey that would ask questions of people, where the people could respond to multiple choice questions (the same way Politico combined the various candidates on a given issue), and then a list of the candidates would be provided in the order that they most closely match the reader's answers? That would be great! In looking at Politico's site, there are sooo many candidates and sooo many issues, that it was hard to pick a candidate that seems most aligned with my own positions. All Politico would need to do would be to add a questionnaire based on the issues and breakouts for the issues that they already have. C.J., Burke, VA
Yep. That is the entire raison d'être for the site ISideWith.com. If you would like to see which political party you agree most with, click here. And if you would like to see which presidential candidate you agree most with, click here. The site gets more accurate over time, of course, as candidates stake out clearer positions. However, it's already pretty good right now.
Technically, a retweet isn't publishing anything, so can Trump actually be tried for libel? Lots of profiles on Twitter indicate that retweets are not endorsements. M.F., Louisville, KY
You are alluding to our item about the Trump tweet suggesting Bill Clinton had Jeffrey Epstein killed, specifically our observation that Clinton might consider suing Trump for libel. It is true that American jurisprudence has not entirely caught up to the Internet Age, and the various implications of the rise of social media and other platforms. However, it is also true that "publish" is defined pretty liberally in libel cases, to mean something like "communicated to an audience." In fact, in some cases, all it took was for one person, beyond the libeler and the libelee, to see a communication in order for "publishing" to have taken place. So, if Clinton did sue, this argument would not save Trump.