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July 2018

Replacing The Republican Establishment

   Once upon a time there was a species called "Rockefeller Republicans" - named after the former Governor of New York, presidential candidate in 1964, 1968, and 1972, and Vice President during Gerald Ford abbreviated presidency from 1974 to 1977 - who  were moderate to left on social issues, center-right on economic issues, and (pro-business) globalist on foreign policy. The definition of "Establishment" has varied over the intervening years, affected by passions surrounding the Vietnam War and the myriad of politicians adhering to or, more frequently, castigating the term. Nevertheless, there remains a core of Republican leaders who align with the Chamber of Commerce, reflect a wealthy donor base, manage much of the party machinery, and look a lot like the old Rockefeller Republicans. 

    Their demise within the party did not begin with Donald Trump. The major socio-economic trend in the United States over the past 40 years has been the growing prosperity of the upper 20%, coupled with decline of real (after inflation) income by the broad middle class. Politically, as the Democrats have moved to the left, focusing their efforts on ethnic minorities and women, they have abandoned their traditional working middle class constituency. Particularly in the Midwest and Appalachia, these voters - having been abandoned by the Democratic Party - changed parties, fueling the Republican take-over of legislatures and governorships in states like Michigan, Wisconsin, Ohio, West Virginia, and Pennsylvania. Nationally, they have demanded a seat at the table in the form of the Tea Party, the Freedom Caucus, and now Donald Trump. 

    It is natural that the Republican Establishment - politicians such as the Bush entourage, former Speaker John Boehner, Senators Bob Corker of Tennessee and Jeff Flake of Arizona, and their intellectual vanguard such as George Will and David Brooks - would take offense. This is not just a traditional liberal / conservative conflict; it reflects culture, geography, and economic status. It reflects the transfer of Republican political power from the elites to the middle class. It affects lobbyists whose connections no longer work. It affects corporate political affairs vice presidents who are no longer connected to those in power. It affects editorial writers who have not kept up with their audience. The Never Trumpers frequently are motivated by what they see as principle (and it is easy to get there with all of Trump's personal foibles), but the underlying factor is the shift of power from Upper Class Republicans to the newly-arrived Middle Class Republicans   

    Beyond egos, personal careers, and Trump's serious personal shortcomings, there are several issues where the new "party of the middle class" receives outspoken criticism for heretical departure from the Republican Establishment:

    1. Foreign Trade. The traditional Republican Establishment thinks in terms of moving capital around the world to wherever it gets the best rate of return; the stockholders don't care whether the workers are in Toledo or Bengladesh; they want some help in opening foreign markets for their products, but they would just as soon make them in other countries and ship them back. When Trump lowers corporate income tax rates the Establishment cheers; when he tries to stop the $800 billion outflow of dollars to pay for trade imbalances, they want the government to let the free market work, never mind that our trading partners play by different rules. There is little difference between the editorial pages of the Wall Street Journal and the New York Times in criticizing Trump's willingness to disrupt the losing status quo in trade, and Establishment Senate Republicans want to legislate away Trump's negotiating authority. The new Middle Class blue collar Republicans?  They want the jobs here. And thoughtful people of good will ask how long we can sustain $800 billion annual trade deficits anyway.  

    2. American subsidization of Pax Americana. When the United States came out of World War II with a dominant, undamaged manufacturing infrastructure we established a benign world order which fit our economic, military, political and cultural objectives - the United Nations; the World Trade Organization; NATO / CENTO / SEATO; the World Bank; the International Monetary Fund. With 5% of the world's population, 25% of the world's Gross Domestic Product, and 35% of the world's military spending we could afford to pay for the wars and subsidize a major portion of the organizations. Establishment Republicans would say "if it ain't broke, don't fix it."  The new Middle Class blue collar Republicans?  They are tired of their children dying in Afghanistan; want roads, bridges, housing, and reservoirs built in America; and are willing to do their share if our allies do likewise. And thoughtful people of good will ask how long we can sustain trillion dollar budget deficits anyway.  

    3. Promotion of working class America. The preponderant majority of Americans share the belief that all people are created equal in a moral and political sense. Unlike almost all other countries, the common ground connecting Americans is a desire for liberty and opportunity rather than an ethnic commonality. Conceptually, almost all would support the rule of law and the need to take personal responsibility. There are, however, nuances of difference between Establishment Republicans and the new Middle Class blue collar Republicans. After decades of being castigated as racist, homophobic, and mysogenist for any hint of political incorrectness, the Republican Establishment buys the program. The blue collar Republicans, who are more directly affected by illegal immigration and street crime, are less willing to place compassion above the law. 

    In the cacophany that is America's political media it has become easy to understand the hysteria on the Left about everything Trump. It is more difficult to sort the voices on the Right between those reflecting the downgraded Republican Establishment and those reflecting the new blue collar Republican voters. Even on Fox there are some of each; editorial policy of the Wall Street Journal is suspicious of Trump's economic policies and acumen; most of the expeditions sent out by traditional media to interview Trump voters do not listen, and thus do not understand.  The support and composition of the party has changed, and the media has not caught up. For some enterprising entrepreneurs this represents opportunity. 


    This week's video is a discussion with former Democratic VP Joe Lieberman about Alexandria Ocasio-Cortez, the New York socialist who has been called the "future of the party" by Democratic National Committee Chairman Tom Perez.   

bill bowen - 7/27/18



Trump's Dreadful Trip

    Sometimes being right on the substance and wrong on the form isn't good enough. While trying to do too much in one week, the president's proclivity for disruption and the media's proclivity for hysteria - familiar shows in domestic venues - fell flat when translated to the world stage. Some things just don't sound as good in French or Finnish as they do at a rally in Kansas City. A perspective: 

    The Bad

    1.  The United Kingdom is in the midst of an epochal struggle to redefine the nation and it's relationship with the world. Prime Minister Theresa May is trying to thread the needle, adopting a "soft Brexit" stance which retains "free trade" and shared customs procedures with Europe, a posture which has caused some 10 of her ministers to resign. The Donald found it necessary to opine that remaining part of the EU for trading purposes would make it impossible to have a trade agreement with the United States - and that her most problematic Conservative Party rival would be a good prime minister. On the merits, a "hard Brexit" would have reflected a choice to align more closely with the United States and the Anglophile world, but this advice reflected a most unwelcome intrusion into British politics at a most inopportune moment.  

    2. Trump's apparent acceptance of Vladimir Putin's perfunctory denial that Russia had meddled in the 2016 election over the American intelligence community's consensus that they had was a low light of the presidency to date. In truth, no level of Trump berating Putin in public would have satisfied the critics. The Justice Department's decision to indict 12 Russian intelligence officers three days before the meeting was intended to ensure that the issue received prominence in the Putin discussions; cries of treason from Obama's CIA director James Brennan and House Democratic Whip Steny Hoyer say much more about them than about Trump's actions; and Trump did see the need to correct the record on the following day. Back in 2016 President Obama told Putin to not meddle again; a similar admonition would have been good. 

    3. Trump's assertion that the United States leaders had acted foolishly relative to Russia in the past deserves domestic discussion, but does little to further our negotiating position with Putin. It is a good thing that Trump was not asked to put some meat on the bone by the collusion-obsessed media. For the big picture from a Russian perspective, the original post-war core NATO was expanded by President Clinton to add Poland, Hungary, and the Czech Republic; by President Bush to add Latvia, Lithuania, Estonia, Bulgaria, Rumania, Slovakia, and Slovenia; and by President Obama to add Albania, Croatia, and Montenegro. President Trump is being asked to add Bosnia/Herzogovina, Macedonia, and the former Soviet Union states of Georgia and the Ukraine.  On the substance, one might also ask about American meddling in Russian elections during the Yeltsin and Gorbachev era; President Obama's assertion that Russian ally Assad must go in Syria; or the coup in the Ukraine which overthrew an elected pro-Russian president and (coupled with potential accession to NATO) put the key Russian naval base in the Crimea at risk. When it comes to Russia, we do lack empathy and self-awareness.   

    The Good 

    1. NATO, and particularly Germany, need to be taken out behind the woodshed. Past presidents have politiely tried, but Trump is committed. Most are not making much progress toward their 2014 commitment to increase defense spending to 2% of GDP by 2024, relying instead on the United States to carry the burden of deterring the Russians while the Western alliance has extended eastward into what was once Moscow's sphere of influence. A major re-thinking is needed when Germany, stuck at 1.2%, enables their former Chancellor (Gerhardt Schroeder) to become CEO of a large Kremlin-connected Russian energy company (Rosneft), and to build a natural gas pipeline which will make Germany reliant on Russia while undercutting Ukraine, which sits astride Russia's current major pipeline to Europe.  

    2. The list of things which Trump discussed with Putin is long and appropriate - the North Korean nuclear program; the war in Syria; the need to contain Iran's ambitions in the Muslim world; a follow-up to the 2010 nuclear arms reductions agreements; Israeli security; the conflict in the Ukraine.  In the age of Resist, the Left doesn't think that Trump should be talking to Putin at all and is critical that there was not a memorandum of new groundbreaking agreements. Talking is good - and the press conference comments relative to North Korea and nuclear arms agreements offer some optimism for those so inclined, as is the offer of a second meeting in Washington.  

    3. We have an annual trade deficit in goods of $150 billion with the European Union, partially offset by a $50 billion surplus in services, driven by both tariffs and other barriers such as exclusion of genetically modified agricultural products. While the big goods imbalance is with China ($375 billion) and there are significant problems with Mexico ($70 billion ) and Japan ($70 billion), Trump was right to explain the need to restore a trade balance with the Europeans. They are allies and not "competitive foes" as Trump claimed, but they are certainly competitors. Everyone objects - major trading partners; the industries facing higher tariffs; the Resisters; the anti-Trumpers - but our global $800 billion trade deficit in goods is not sustainable. There was time when most of our markets were internal; we were rich enough to use trade deficits as a major geopolitical tool; and "free trade" did not need to be balanced. That time has passed, and Trump is willing to take the short term heat - particularly at a time when the economy is booming. 

    Bereft of other ideas, the Left has escalated its "Russia is the enemy, Trump wants to get along with Putin, Mueller will find the smoking gun" meme. From a long term geopolitical perspective Trump has it right - as did Obama, if by intent if not action. With their nucler arsenal, energy resources, broad geographic sweep, and United Nations veto power, the Russians are an important player relative to both Europe and China.  Trying to work with them - regardless of what Chuck Schumer and Rachel Maddow think - is a good thing. For that Trump deserves credit. 


    This week's video is a short, little-reported section of the Trump-Putin press conferendce in Helsinki - in which Putin talks about $400 million which were illegally obtained in Russia and contributed to Hillary Clinton (presumably through the Clinton Foundation.) 

bill bowen - 7/20/2018

The Judicial Long Game

    The reporting on the nomination of Brett Kavanaugh to fill the Anthony Kennedy seat on the Supreme Court will revolve around tactics and trivia - efforts to sway undeclared senators; nuances of 300 written opinions; details of an apparently exemplary life. The Kavanaugh appointment is not about abortion, impeachment, healthcare, or the vote of one or two senators. It is not really about "liberal" or "conservative" in the sense that the justices have personal views on social issues, religion, security, or the economy.  It is about Alexander Hamilton's belief in the Constitution as a guarantee of liberty against the appetites of a democratic mob, and the Supreme Court's fealty to limitations of legislative and executive power in the Constitution as the ultimate protector against democracy run amok. Brett Kavanaugh represents the ascendency of Hamilton's federalist majority on the Supreme Court - the product of quiet, tedious work in the fields - which has been gaining ground for 36 years. 

    Major shifts in governmental philosophy occur in long cycles. What is happening today can best be understood in relation to the "Warren Court" of 1953-1969.  Chief Justice Earl Warren, three times elected governor of California, vice-presidential nominee with Thomas Dewey in 1948, and arch-enemy of Richard Nixon, was a politician rather than a jurist. He saw the courts as an alternative path for political objectives which could not be achieved by legislation. Prominent members of the Court during the Warren era included Justices William Brennan, William O. Douglas, Hugo Black, and Felix Frankfurter, who shared his activist and liberal orientations. In a large sense, the Warren Court represented a philosophical continuation of FDR's New Deal with expansion of equal educational opportunity for minorities, application of the Bill of Rights to the states as well as the Federal government, and the eliminatioin of prayer in public schools. By today's standards, much of the output of the Warren Court would seem mainstream, and for the intervening 49 years the role of the courts as arbiters of social norms has largely continued. For most justices, this is decided law. 

    So it was in 1982 when a handful of law students in Chicago, Cambridge, and New Haven supported by leading conservative thinkers such as Ronald Reagan's Attorney General Ed Meese and Solicitor General Robert Bork began to organize the movement which sought to return the courts to their limited role of applying the law, rather than extending it to match their social or political objectives.  Today the Federalist Society is organized into a faculty division, a student division with 10,000 members on 200 campuses and a practicing lawyers division with 60,000 members. Prime funders include the Chamber of Commerce and the Koch Brothers. Rather than advocate for specific issues,  the Federalist Society  is based on the clear principle that "the state exists to preserve freedom, that the separation of governmental powers is central to our constitution, and that it is emphatically the province and duty of the judiciary to say what the law is, not what it should be." 

    These are serious thinkers. They want less power for their profession as judges, rather than more.  Bork and Antonin Scalia were original Federalist Society faculty advisors. Current members Samuel Alito and Neil Gorsuch are proud members. Chief Justice John Roberts is more circumspect, but has been identified as an advisor earlier in his career. Justices Clarence Thomas has been a headline speaker at a Federalist Society event. Assuming Kavanaugh's Senate approval, the court will undoubtedly have differences in applying precedents or interpreting the original intent of the drafters, but they will be united in their belief that it is not their job to expand the constitution or the Congress' written laws. There will be no more mistakes such as  Sandra Day O'Connor and  David Souter who, after being appointed by President Reagan and George HW Bush migrated toward the center.  

    When George W. Bush became president in 2001, he abandoned the long standing practice of seeking ratings - Unqualified; Qualified; Highly Qualified - for judicial appointments from the American Bar Association, whose increasingly liberal leaning had led to obvious bias in their ratings. That left the door open for President Trump to promise during the 2016 campaign that he would rely on a list recommended by the Federalist Society, knowing that he would get candidates of great intellect, strong character, and consistent opinions that would be trusted to limit the role of the court to applying the law as written, rather than deciding that the president should not have the power to limit imigration from Muslim majority countries, or that illegal immigrants are entitled to all of the protections of the Bill of Rights. If the consensus is wrong and Kavanaugh does not get confirmed, there will be a similar resume for the next Senate which will probably have more Republicans. And if Justices Ginsberg and Breyer cannnot continue will into their 80's, or if Trump gets re-elected, there will be three or four of these Trump appointments to what was already a conservative-leaning court. 

    Much has been made of Establishment Republicans becoming "Never Trumpers". That is true of some in the business branch who are concerned about trade, but not $700 billion deficits, and the internationalist branch who are concerned about relations with traditioinal allies, but not burden sharing in light of our $20 trillion national debt. Not so the legal system Establishment branch, which is enjoying a sweet spot which will last decades, regardless of congressional or presidential politics. 


  This week's video is the Number Two Democrat in the Senate calling for at least three of his party colleagues to commit political suicide by voting against any Trump appointee, despite the president's popularity in their states. Go for it! 

bill bowen - 7/13/18 







Mexico: Risk and Opportunity

    In this age when everything is about Trump, the July 1, elections in Mexico risk passing with little notice in the Norteamericano consciousness.  With the election of hard left President Andres Manuel Lopez Obrador (AMLO), a legislative majority for his new National Regeneration Movement (Morena) party, and the rebuke of both the long-governing Institutional Revolutionary Party (PRI)  and the more recent establishment conservative alternative, the National Action Party (PAN), our neighbor's 130,000,000 people have opted to change direction from the past three decades which have brought generally fair elections and an improved economy driven by NAFTA and opening of the energy sector to foreign capital. We stand to be significantly affected. 

    First some stage setting:

        - For the past dozen years Mexico's government has cooperated with the United States in a military approach to defeating the drug cartels, but the problem of corruption and violence has grown progressively worse. Among the milestones in the sad story are the defeat of the Columbian cartels in the late 90's (which shifted management leadership to Mexico), the decline of the PRI (whose local affiliates had "understandings" with drug smugglers), and successful efforts to eliminate major cartel factions (which result in turf wars among the survivors.)  The official murder rate was 27,000 in 2017. Some 120 candidates for local office were killed in the runup to the July elections.  

        -  The rebellion against the political esablishment had several themes:

            -- The global swing toward nationalist candidates who project strength in looking out for their countrymen. AMLO promises a strong leader, capable of standing up to Donald Trump's denigration of Mexico and Mexicans. 

            -- A promise to shift the war against the cartels from a military focus to one of offering poor Mexicans an employment option through free education at all levels and more social programs to narrow the extreme gap between the wealthy and the lower levels of the population which is among the worst in Latin America, and growing.  

            -- A promise to revert to Mexico's socialist past, halting the privatization of the electric grid and stopping private oil contracts - and to renegotiate NAFTA.  

        - From Mexico's perspective, immigration from Mexico to the United States should not be a problem. Since the Great Recession in 2008, the net flow north from Mexico has largely abated. Despite a 2014 initiative which has turned back most migrants from Honduras, El Salvador, and Guatemala at Mexico's southern border, the number of illegals entering the United States through Mexico from these countries exceeds those from Mexico.  

    It is a new day in Mexico, perhaps the most transformational in generations. Pessimists fear a collapse of the society as the PRI infrastructure is disbanded, the application of military force against the cartels is reduced, and government socialist policies blow up the budget and drive away foreign investment. They point to the potential for AMLO, unconstrained by opposition parties, to emerge in the model of Fidel Castro in Cuba or Hugo Chavez in Venezuela. Should he choose so, he will have a ready rallying cry in resisting Trump's border and trade policies. By design or as a result of economics and lawlessness in Mexico, there could be a return to mass movement to the United States.  

      The optimists would say that the new Mexican leader has learned pragmatic executive skills during his experience as mayor of Mexico City, and political skills from his three presidential campaigns. Trump needs to complete some of the disruptive projects which he has begun, and a renegotiation of our trade relationship with Mexico might serve both men. The wall and how we treat illegal immigrants will be determined in Washington, but expanded joint (largely US-funded) efforts to improve conditions in Central America and to disrupt the human trafficking could benefit both countries. 

    With Trump's foreign policy staff overtaxed - North Korea; Russia; China; trade agreements - Mexico is unlikely to receive the attention needed by our neighbor which is in the Emergency Room. And then there is the reality of the $64 billion trade deficit; and the cynical benefit to DemocratIc and Republican politicians of not solving the immigration problem.  Absent vision, empathy, and and informed self-interest, the traditional benign neglect seems likely. 


   This week's video is a surprising Washington Post piece on Amy Coney Barrett, who would be wonderful member of the Supreme Court. 

bill bowen - 7/6/18