Friday Thoughts
I had intended to write this Friday Thoughts last Friday. But, this time of year is busy and I didn't get time to sit down and write. Clara turned ten last Tuesday and we had 14 little girls over to the house on Friday night. She wanted to do a sleep over, but there was no way that we were going to have that many girls over the night. And, our sweet daughter just couldn’t leave someone out. So, my awesome wife had the idea of a “sleep under” party - they were in pajamas, ate pizza, did cleansing face mask things, popped popcorn, watched a movie, then they all went home before 10. It was a total blast for the kids and I didn't have to take 14 different breakfast orders on Saturday morning! Then, Sunday we went to set up for field day at school. Nancy Lee was the co-chair of field day this year, so we were out there all morning on Monday.
I’ve finally had some time put my thoughts together and sit at the computer. It turns out that I’m glad that I hadn’t written this last week, because I think what I wanted to talk about is even more top of mind this week than to was last week due to this showdown about the debt ceiling - politics! I know, politics and religion are the two topics that we’re not supposed to discuss in polite society. But, we’ve seen a rapidly changing political culture as of late and I heard some interesting things about it during the Mauldin Strategic Investment Conference (SIC) earlier this month that I wanted to share.
This was my fourth SIC and politics was discussed this year more than any other. I thought that the most impactful session, regarding politics, was one in which the moderator talked with both conservative pollster Dr. Frank Luntz and former Democratic Presidential candidate Andrew Yang. While they come from opposite sides of the political spectrum, they both shared a disgust of the polarization of our political extremes we’re seeing today. I think we’re all aware of how the extremes of the Republicans and the Democrats have seemingly taken control of each party.
There was an agreement that cable news started this trend of reinforcing our own beliefs. Left-leaning people were able to watch left-leaning channels and right-leaning people were able to watch right-leaning channels. The rise of social media has made the situation even worse. I wrote two weeks ago about how impassioned Frank Luntz got about how social media is destroying our children.
I had to laugh when Andrew Yang said this about the front runners for the 2024 Presidential race, “And you have to ask yourself, ‘How is it that in a country of 330 million people, we're going to have these two people again as our only choices, combined age 160, both of them deeply unpopular?’ And it's because the two party system really has become increasingly institutionalized and unrepresentative.”
Frank Luntz said that his polling is showing a growing sense of frustration and anxiety. He said that people are frustrated that they elect people who say one thing when they’re running and do just the opposite once they’re in office. The anxiety is that, for the first time, this generation believes that their children are going to have it worse off than they are. I can say that I’ve heard the same feeling of frustration and anxiety in the conversations I have with my clients.
The most intriguing thing to me is that Neal Howe had predicted this in his book, The Fourth Turning, published in 1997. He wrote about the cycles that we go though, economically, socially, and culturally. He spoke at the SIC about how he feels we are now in the fourth turning cycle where there is a loss of national community. This has happened about every 80 years in the US. The last fourth turning was the Great Depression and ended with WWII. He reminded us that during the Depression there was a great sense that America had lost its way and that the country was very divided and polarized. The New Deal Democrats and the Republicans fought mightily over ways to fix the country.
These periods of distrust and frustration often lead to conflict, usually both internally and externally. Historically, that conflict has been both violent and non-violent. In the US, we have had violent conflict about every 80 years. In the 1940’s we fought WWII. In the 1860’s we had the Civil War. And, we fought the War for Independence from 1775 through 1783. Wow!
That can sound very depressing to hear. But, the good news is that we have come out of all of those conflicts with a new optimism and increased patriotism. These conflicts are the incubator of a new national community. Several of the speakers at the SIC spoke of their efforts to sow those seeds that will grow into to a renewed sense of community.
Howard Marks is the co-chairman of Oaktree Capital, an investment and private equity firm. He has written several books and I always learn a lot when I get the chance to read something he has written or hear him speak. At this year’s SIC, he spoke about his support of a group that calls itself “No Labels”. No Labels was formed in 2010 as a bipartisan organization that’s trying to find compromise from the middle of the political spectrum. It was started by Joe Manchin and Susan Collins and presently has 32 house Democrats and 32 house Republicans who are part of the group. This group is putting together the infrastructure to possibly run a third party candidate for President in 2024.
He was very clear that they will only do so if it looks to be rematch of 2020, with a Biden - Trump race. When asked if it would be detrimental because it would pull votes from either Trump or Biden, such as what happened when Ross Perot ran in 1992, he had an interesting reply. “So lots of Democrats have complained that if we do this, we'll throw the election to Trump by draining off Biden voters. Some Republicans think we'll throw the election of Biden by draining our Trump voters. Obviously, they can't both be right, by the way. And we're very cognizant of this, we're not going to do this cavalierly. And we are only going to do it if we feel we'll win.”
One of the other surprises for me was that a number of speakers said that they didn’t expect it to be a Biden - Trump race. Neil Howe had this to say about it, “I think both parties are leaderless. Frankly, I don't care who declares their presidential runs. And I wouldn't be at all surprised if both candidates in 2024 are going to be people that you didn't expect. I actually have doubts as to whether Biden will truly end up running and whether Trump will actually be nominated.” Several other speakers had similar thoughts.
Andrew Yang said that he thinks that most of America lives in the center of the political spectrum and that they will rise up because they are fed up with the way things are. He has started a third party called the “Forward Party”. He said that he named it that because people don’t want to to be left, or right, they want to move the country forward. Frank Luntz agreed. He said that you can see the interest in an alternative in his focus groups like never before. Andrew said that the Forward Party isn’t going to focus on the national level, like No Labels. Rather, they are working on the local level in deeply divided areas.
He used the example of how he thinks it will work in California. California’s legislature is 75% Democrats. It’s a one party state. A Republican doesn’t stand a chance, because a lot of people automatically rule them out. He hopes that the frustration of the status quo will cause them to at least pause and listen to what a third party candidate has to say. His plan is to win a few mayoral races, some state level races, maybe a US House seat or two. Then it can start to get some attention and build excitement that there is an alternative to the way things are.
Finally, I’ll add that Frank Luntz is seeing a growing interest in changing the way that we elect our representatives. He suggested a few ways to improve our election process. First is to open up the primaries. We do this in SC, but many states don’t. The second, and this is where the trend is shifting, is to use rank choice voting. Here is how he described it, “You don't just vote once. Let's say you got five candidates running. You vote for your first choice, your second choice, your third choice, because that's a way to say, ‘I don't want this individual.’ And by doing that, it automatically makes it more difficult for the extreme candidates, those on the fringes on the left or the right to win elections. That's why Alaska is nominating centrist. It's why Maine has done the same thing. They've changed their electoral system.”
In summary, our political system is at a tipping point. It has grown more and more hostile, and it’s time for the people to do something about it. This debt ceiling issue is a prime example. President Biden ignored the issue and refused to even talk with Speaker McCarthy for months. Now, the Republicans are digging in their heels on spending cuts. I personally believe that we MUST deal with our spending issues in this country. But, we also cannot not pay our bills. I’m writing this on Wednesday, so maybe by the time you read it a deal will have been reached.
I suspect that a deal will get made in the last minute and they’ll kick the can down the road a little bit further, like they always do.
But, at some point we’re going to reach the point that the road ends and we cannot kick the can any further. My hope is that the conflict that will result when we reach that point is one that can be addressed at the ballot box, not in the streets. In the meantime, I hope that we have a societal conversation about how we work together to solve our issues. We all know that something must change. Let’s work together to head toward that change.
I mentioned that I’m writing this on Wednesday. That’s because we’re heading to the mountains for Memorial Day. We’re leaving on Thursday afternoon to spend the weekend at a campground east of Asheville. I love our camping trips, as it gives us a chance to see the beauty of this country. And, I don’t just mean the pretty landscapes. We are a beautiful people. Yeah, there are some dopes out there. But, by and large we’re amazing. These trips restore my hope in us.
I hope that you have a wonderful Memorial Day weekend. Let us all remember the reason for this long weekend - those who paid the ultimate sacrifice fighting for our freedoms to have these political debates in an open and public way.
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