I’ve come to despise politics, which is unfortunate because I was raised around political scientists, most of whom I liked.
One of my degrees is in political science and were it not for a (very) late game pivot to public administration and then, after that, business school, I’d have two ornate, framed pieces of paper conferring upon me the solemn right to make arrogant, specious claims about classical political theory and how centuries-dead philosophers would judge our current politics.
As an aside for my younger readers, I don’t recommend eleventh hour course work pivots. Those credit hours cost money and at major universities, they often have a shelf life. Your post-grad advisors may not tell you this, but there’s an expiration date on any promises you might make to yourself about coming back “later” to write a dissertation.
American politics has never been particularly staid. The nation was, after all, founded in bloody rebellion. Intractable disagreements between top officials were once settled with pistol duels. And we killed each other by the hundreds of thousands to resolve a glaring contradiction between a key bit of founding wisdom (“All men are created equal” as a “self-evident” truth) and a heinously cruel socioeconomic institution (slavery). Seen in that light, I guess you could say things have improved, but recent events suggest we’re backsliding pretty fast.
The biggest threat to American democracy is the fraying of the social fabric and the deterioration of public discourse into a profane shouting match couched in poisonous identity politics. One party is engaged in a wholly nefarious effort to leverage state legislatures to strip the electorate of the right to choose a president, a right that was tenuous enough already due to an electoral college system which, like too many of my social science graduate credit hours, is past its sell-by date.
The same party is keen to whittle down voting rights such that the only people whose opinion counts are those inclined to support that party. That’s not going to work out well from a societal perspective because that party’s agenda is out of step with modernity, not supported by the majority on most issues and, increasingly, inconsistent with the inclinations of corporate America.
More dangerous still, the nation’s high court has metamorphosed into a panel of clerics, one of whom seems particularly aggrieved. The risk is that a half-dozen people are inclined to impose a medieval agenda on 331,999,994 other people, based on a religious reading of a 235-year-old document which, among other things, specifically (but not specifically enough, apparently) de-linked religion from the functioning of government.
All of that makes for a regrettable state of affairs. It’s so flagrant that it’s scarcely worth mentioning. Which is why I don’t mention it very often. It’s obvious to everyone and it’s terrifying to most people, where “most” admittedly just means a slim majority. More unfortunate, perhaps, is the other party’s unwillingness to breach decorum to save the republic even when they’re in control of government, as they are for another two months, counting the lame duck session.
Over the years, I’ve worked to professionalize this portal on every conceivable front, going so far as to veer completely away from political satire, even as that was among the most popular content once upon a time. “Pure” political content went mostly extinct here long ago in favor of “softer” commentary folded in with the daily market narrative. The evolution of my editorial bent has severed me well and, I think, served readers well too. Subscriber turnover is basically non-existent, for example. Almost nobody leaves anymore, which I’d like to imagine is a testament to the value of the macroeconomic and market commentary, but if I’m honest is probably also attributable to the near complete absence of anything that’s overtly (or overly, without the “t”) contentious.
I intend to preserve that editorial bent in perpetuity because, again, it’s preferable to readers on both sides of the political spectrum, and also more conducive to civil discussion. But, as the midterm elections in the US approach, I wanted to call market participants’ attention to the points made above about where the GOP and the high court are taking our “city upon a hill.”
Make no mistake: This is more important for market participants over the long-term than 8-handle inflation or any other macro debate you care to have. America is creeping down the road to becoming something that only a small percentage of the populace will enjoy once the transformation has run its course. If this is allowed to continue, future generations won’t enjoy the kinds of privileges we still enjoy today. Privileges like currency hegemony, unquestioned demand for our debt and universal faith in our capital markets. All of that is predicated, in the final analysis, on international assumptions about stability, competency and sanity in Washington. Stability went out the window several years ago. Competency decades ago. Sanity’s next.
To be absolutely clear (and absolutely fair), Joe Biden is a successful politician, a very successful vice president but, so far anyway, a failed president. Relatedly, Biden’s Attorney General would be more at home as vice president and his vice president more at home as Attorney General. The Department of Justice has the capacity to put the brakes on some of the deleterious trends mentioned above, but Merrick Garland is reluctant to do so, perhaps fearing some manner of social unrest. I’d gently note that the social unrest is already here. It boils over at regular intervals. Just days ago, somebody attacked the House Speaker’s husband with a hammer. The richest person on the planet posited a conspiracy theory about the assault, underscoring the extent to which the public consciousness is being gradually poisoned by born-again rightwing populists, and self-styled libertarians. That mirrors the demise of the GOP, which is being similarly poisoned from within. The party is probably beyond saving. Some stalwarts have given up on it. But the country isn’t beyond saving. Or at least one hopes not.
Democrats need to find a savior candidate. I don’t know who that person is, but I do know he or she wasn’t on stage for any of the 2020 Democratic primaries. They (Democrats) need to do this now. Not whenever Biden finally decides to admit that a second term might not be optimal.
Obviously, tackling the pandemic and shoring up the economy were the first priority for this administration, but the fate of the American experiment itself hangs in the balance. On that front, this White House, this Congress and this Justice Department squandered two years the nation couldn’t afford to waste.
To my Republican readers (and I’m beginning to believe that’s actually a small majority), I’d strongly encourage you to consider the fact that what’s happening at the state level, what’s happening with voting rights, what’s happening in terms of the kinds of people who are increasingly likely to occupy GOP House seats and what’s happening at the Court, together risk undermining America’s credibility — and irreparably.
If these trends continue, immigration won’t be a “problem” because nobody will want to come here. That’ll have ramifications for inflation, innovation and the economy more generally. Global investors won’t trust their money in America. In fact, global investors might stop trusting America’s money. Would you keep your FX reserves in a currency issued by a government made up of politicians who are more likely to “study” Alex Jones than John Locke? No? Well why would you expect anyone else to? Would you invoice your oil shipments in a currency issued by a country where the laws are all effectively subject to veto and rewrites by a handful of ultra-conservative religious ideologues? No? Well why would you expect anyone else to?
I could go on, but I think that’s clear enough. Ultimately, I needed to pen a midterm preview for readers, and early this morning I set about something dry, which was basically a paraphrased, slimmed down version of what you could get anywhere else. Then I thought, “Where’s the fun in that?” Instead, I give you the above, submitted for your approval. Or disapproval, whichever the case may be.