The surprising stock market

I follow only the Australian stock market but it generally mirrors Wall st. and I gather that it is still doing so at the moment

The surprise is how robust stock values are at the moment. The lockdowns knocked about 12% off the value of my portfolio but the election has substantially reversed that. My portfolio is now only about 6% down on where it was

There were a lot of pundits who said the market was in for a big fall. So what happened? It seems to be that investors now expect gridlock in American politics. And gridlock is something conservatives rather like. If there is no agreement in politics, no new laws will be passed and no new regulations will be issued. That means that businesses have to cope with market challenges only, not political changes. While the politicians are squabbling with one another, it gets them off the back of business

There was a good example of that during the British prime ministership of the unfortunate Theresa May. Her weak leadership plus a near balance in the House of Commons meant that very little got done politically. And British business boomed at that time.

So it seems that U.S. business is expecting something similar now. And that expectation will be well and truly fulfilled if, as expected, the GOP retains control of the Senate.

And over the last 4 years the GOP has very largely become the party of Trump. His attitudes and policies have not only won huge approval among the GOP rank and file but have also percolated into the thinking of most Senators, the contemptible Mitt Romney being the obvious exception. But even waverers like Romney, Collins and Murkowsky have generally gone along with the rest of their Senate colleagues anyhow. So a Senate dominated by Trump thinking will be a total roadblock to any of the insane new legislation that Biden has proposed.

And note that the GOP has also done well both in the House and in picking up State governorships. So even if sufficient new votes are "found" to deny the GOP complete control of the Senate, Congress as a whole will end up finely balanced and should as such fulfil its traditional role as a brake on change. Getting a majority for anything in either house is not easy. Only measures with a considerable degree of consensus behind them normally get up.

It took the first two years of his presidency for Obama and his supporters to get Obamacare through, during which little else got done

And I haven't even mentioned yet the now very conservative Supreme Court. The one big thing that conservatives wanted from Trump was to rebalance the Supreme Court and he achieved exactly that. And the Supreme court has a proven ability to knock on the head any adventurous legislation or regulations -- JR

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Brash and bold, Trump’s legacy will endure

Donald Trump has transformed America. The election is gone, Trump is still there. At time of writing, the odds favour Joe Biden getting across the line. Trump’s huge vote and Republican advances in congress could be seen as a moral victory. But Trump is not remotely interested in moral victories.

Everyone’s calculations got thrown out this election because people who voted on polling day voted Trump, while those who voted by mail-in ballot voted Biden. Therefore in some states Trump had leads of hundreds of thousands, which withered when the mail votes were counted.

The purpose of Trump’s allegations are twofold. One is to give some momentum to the legal challenges his campaign has launched against counting certain votes that they claim came in too late or were otherwise invalid. It is perfectly legitimate for Trump to pursue all legal avenues.

However, even if they have some modest success, these actions won’t get so many votes excluded that it changes the result.

Second, Trump sets up the narrative that the election was stolen. This enables him to stay the centre of attention and continue what he loves most, wage a campaign of grievance.

There is a theoretical, extreme scenario in which Republican state legislatures, say in Georgia, decide votes have been rigged and so choose only electoral college delegates who will support Trump as president. It’s technically possible but pretty much inconceivable if courts have ruled the votes valid.

One of the ironies of Trump’s likely defeat is it means the Republican Party is not rid of Trump. He can threaten to run for the presidency again for the next three years. If he had won the presidency, at least the Republicans could start to sort themselves out about who they can run next time, and on what basis.

But Trump’s legacy for the Republicans, for America and for the world is huge. It does not hinge on this one set of comments.

Let’s consider them one by one: Trump’s legacy for democracy, for America, for conservative politics and for the world.

First of all, consider Trump’s vote. Biden won the popular vote. He has about 74 million votes now and by the end of all states doing all their counting will have probably a couple of million more. He already has more votes than have ever been cast for any presidential candidate previously in US history. On any measure, that is a huge achievement for Biden. If as seems likely he inches ahead in the electoral college and becomes president there can be no doubting the legitimacy of his presidency, nor his singular place in the history of American presidential elections.

Guess who has the second highest popular vote in US presidential history? One Donald J. Trump. He has about 70 million votes now and he too should end up with a million or two more by the end. More people voted for Trump than ever voted for Barack Obama, the previous record holder, or for Hillary Clinton last time, or for any other president.

Not only that, Trump clearly held up the Republican vote. It’s still murky but it seems that the Republicans have held control of the Senate and have actually picked up a net gain of six seats in the US House of Representatives. It’s possible that two senators will have to go to run-off elections in Georgia on January 5. The Republicans would need to win one of them to retain control of the Senate.

This is because Georgia has a provision that if the winning candidate does not win 50 per cent, a run-off is held. Would Georgians vote to constrain a Biden presidency with a Republican senate? Would they vote to make it more likely a Biden presidency could get key legislation passed? What role will Trump himself play in such an election?

But let’s stick with Trump’s vote for a minute. According to the US liberal establishment, the nation was reeling under its moral revulsion at Trump and his Republican enablers. This is plainly just not true. Republicans picked up a state governorship in Montana and now control the governor’s mansion in 27 of 50 states.

Not all the seats in the House of Representatives are decided, but one projection suggests the Democrats will end up with 226 and the Republicans 209. It is rare for a president to sweep to power and his party lose seats in congress. That suggests Biden was more popular than the Democratic Party and its far-left platform.

It is also important because in two years there will be a mid-term congressional election. In these, the president’s party normally loses seats. This happened in huge bad results for Democrats in Bill Clinton’s first mid-term election in 1994 and similarly in Barack Obama’s first mid-term in 2010. Obama was personally popular yet Democrats lost 63 house seats in 2010. There is every chance that in two years Biden could be president, but the Senate, the house and a majority of state governors all Republicans, with the federal court system and the Supreme Court mainly peopled by judicial conservatives.

There are lots of reasons for conservatives to be deeply worried about the long-term effects of Trumpism. Electoral failure does not seem to be one of them. As one wag put it, the election was a contest between those who disliked or hated Trump’s personality, as opposed to those who disliked or hated the Democrats’ swing to the left. Democrats talking of socialism, defunding the police and ending fossil fuels is enough to make voters very wary. Commentators routinely decry gridlock. But Americans vote for gridlock quite deliberately. In Maine Biden trounced Trump in the presidential vote. But Republican senator Susan Collins trounced her Democratic challenger. Despite the heightened partisan divides of America, millions of Americans voted deliberately to put Biden in the White House and make sure he couldn’t do anything.

Even people who like Trump find him exhausting. The mood of America may have been quite well captured in these paradoxical results: we want a sleepy old guy who is kindly and snoozing in the White House, and a congress and judiciary that keeps him paralysed. In this time of ideological turmoil, we vote deliberately for do-nothing government. Elmer Fudd in the White House, Deputy Dawg in the Senate, Yogi Bear in the house and Dudley Do-Right in the judiciary. Put sports back on the front page (except when it’s taking a knee).

Trump also has changed the content of conservatism in some positive ways. Trump will get 47 or 48 per cent of the vote in the end. This actually understates his support. Because of the structure of the electoral college, he didn’t campaign at all in California or New York or even Illinois. If he had campaigned in those states he wouldn’t have won them, but he would have tightened the popular vote considerably.

America is just about a 50-50 nation and Trump was considered the best man by roughly half America. If polls tell you otherwise ignore them, for in this election the polls proved themselves worthless, systematically understating not only Trump’s vote but the conservative vote generally, and by appalling margins.

The old ideological construct of the pre-Trump Republican Party is dead. It won’t come back. Trump himself is much less an international outlier here than is often claimed. The old Tory dispensation is dead in Britain. Boris Johnson won his huge parliamentary majority on the back of Brexit and support from northern working-class England and in exchange his policies included a lot of big government and intervention for working-class people, including industry policy. Scott Morrison was returned to government by provincial Queensland seats and working-class Tasmanian seats and he has put all ideology in the bottom drawer if not altogether the dustbin of history. His government is taking direct measures to revive manufacturing.

Centre-right parties around the world are seeking and gaining the support of working-class people while centre-left parties are dominated by green, woke identity-politics, climate-change crusades, and draw their support from upper-income, service-industry, limousine liberals.

The poorest three states in mainland America are Arkansas, Mississippi and West Virginia. They all voted overwhelmingly for Trump and now always vote Republican. The states at the other end of the income scale, the wealthiest states in America — Maryland, New Jersey, Hawaii, Massachusetts and Connecticut — now always vote for the Democrat in presidential elections. US citizens with average incomes and below overwhelmingly donated money to Trump. Those with above average incomes overwhelmingly donated money to Biden. Trump also got more non-white voters than any recent Republican. They’re not that woke either.

The old Republican program was free trade, low taxes, lower spending, cuts to welfare to reduce the deficit, globalisation, strong defence, global security leadership, border control. Trump is an outlier in his often gross rhetoric. But in his actual policies, he is fairly normal contemporary centre right. He junked the version of free trade that saw the US obey the rules but endure enormous trade deficits with China and other nations that don’t obey the rules. For Canada and Mexico Trump didn’t embrace protectionism but negotiated a better deal. He wants a much bigger manufacturing industry and lots of manufacturing jobs. He kept border control and low taxes and, pre COVID-19, his tax cuts produced a booming economy. But he won’t cut welfare because he now represents millions of people who are on welfare or might go on welfare one day.

Trump kept the commitment to strong defence and the military budget reflects that. But he doesn’t like providing security to allies who don’t bear their share of the burden. Some reaction like this was bound to come eventually. The failing here is not primarily Trump’s, but rather that of free-riding US allies.

But here is one Trump innovation. He utterly, straightforwardly, vigorously, contemptuously rejects the politically correct, woke culture. In my view he does this coarsely and crudely. But as one wag put it, Trump is the only middle finger ordinary Americans had available to raise at the preening left-liberal establishment which holds that they are all racists and their national sentiment contemptible.

Can a more mainstream Republican, who doesn’t have Trump’s genius for making himself the centre of attention, overcome the enormous financial advantage the Democrats now have? Big tech, social media and almost all mainstream media went all in for Biden. Social media crossed a dangerous Rubicon when it started censoring Trump and mainstream newspapers and conservatives if they weren’t backing Biden.

This is the most sinister, anti-democratic and genuinely disturbing development of this election. Trump was never an authoritarian leader. He doesn’t control the military, the media, the judiciary or a mass movement in the streets, and he has never disobeyed a court ruling against his administration. The real danger of US authoritarianism now comes from the alliance of political power in Biden and the Democrats, with financial power in Big Tech, media power in social and mainstream media, and cultural power in Hollywood. They share ugly, coercive conformism.

Which is why Republican control of the Senate and so many state governorships is so important, and so healthy.

In international affairs Trump damaged American soft power. But hard power is more important than soft power. Trump built new leverage against China, Iran, Mexico, NATO partners, even multilateral institutions which desperately want the Americans back. If Biden is smart he will use that leverage to achieve US policy aims, not just give it away in a silly desire to reverse everything Trump did.

Out of office, Trump has the potential to be wildly destructive, not least of Republicans. But so far, his legacy is mixed, by no means all bad.

https://www.theaustralian.com.au/inquirer/us-election-2020-brash-and-bold-trumps-legacy-will-endure/news-story/0321856a15d41e46f1fc1190293580a6

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