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By William J. Dodwell
by William J. Dodwell
By William J. Dodwell July 24, 2023
Singer Tony Bennett died last Friday, July 21, 2023, less than two weeks shy of 97. He was the last of the original practitioners of The Great American Songbook, that genre of romantic music from about 1920-1965. He never compromised his elegant style in the face of cultural degradation all around him. Always wearing a nice suit with an infectious smile, he embodied the class that all society used to respect. Although diagnosed with Alzheimer’s disease in 2016, he performed live until turning 95 in 2021. Afterwards, he rehearsed two 90-minute sets a week in his apartment with his pianist.
In tribute, I present my piano rendition of Tony Bennett’s signature song, “I Left My Heart In San Francisco” at I Left My Heart In San Francisco - YouTube
I think one of Tony’s enduring legacies will be his duets with one Lady Gaga in recent years. Indeed, he brought out the class in her. Who knew? I had dismissed her as a nut in outrageous outfits spewing obscenities on stage. Tony Bennett introduced an entirely different person. See my 2014 article about my awakening titled, “Lady Gaga With Tony Bennett: The Chick Actually Sings” at https://sites.google.com/site/thecomprehensiveconservative/archives/archives_1#h.clc8i0zan9xu . I would like to believe this coupling engendered a certain appreciation for traditional music among younger audiences. In any case, I suspect she will become a “keeper of the flame” at Tony’s insistence.
Although I never met Tony, I did have a close encounter. He was in the back of an Italian restaurant he frequented on Manhattan’s east side as I was at the bar listening to the house pianist. As was my wont over the years as a lifelong pianist, I often took notes on cocktail napkins, there and elsewhere, about repertoire, arrangements and improvisational ideas. Suddenly, a crowd roar emerged and the woman next to me shouted, “He looks great!” I figured some celebrity was present (common there) and I did not want to appear star-struck. So, being too cool for school, I didn’t bother to look.
After he left I learned it was Tony, then about 90. He might have brushed the back of my chair walking the narrow aisle on the way out. Sadly, I squandered an opportunity to at least shake his hand. As Sinatra sang in “My Way”, “Regrets, I’ve had a few…”
©2023 William J. Dodwell
by William J. Dodwell
By William J. Dodwell June 1, 2023
The Biden-McCarthy agreement
Throughout current debt-ceiling negotiations, Republicans have postured hard about arresting the trajectory of the $32 trillion national indebtedness. But Speaker McCarthy has come up short in his deal with President Biden that just passed the House. He cites broad progress through record spending cuts, but avoids mentioning the paltry amounts of savings that are of little consequence. That more Democrats voted for the bill than Republicans is telling. Consider the following:
- The GOP replaced its original bill to raise the debt limit by $4.5 trillion in exchange for spending cuts with a suspension of the current $31.4 trillion limit that leaves no ceiling whatsoever until 2025. Given Democratic control of government, this blank check permits unlimited spending into 2025 that invites more profligacy of the sort seen since Biden took office.
- The current pact freezes spending at the 2024 level with a 1% cap on a fiscal 2025 increase. This contrasts with the original Republican offer to limit spending at the lower 2022 $6.3 trillion level with a 1% cap on annual spending for 10 years. Both proposals include trillions of dollars of one-off Covid 19 spending needlessly built into the budget baseline of future years. Fixing spending at pre-Covid levels would be much more meaningful. The proposed legislation will reduce the deficit $1.5 trillion over 10 years. That is merely 10% - $150 billion annually against a projected 2023 deficit of $1.5 trillion.
- The agreement eliminates only about $30 billion of the originally asked $300 billion of unspent Covid funds. This is a terrible waste now that even the president has declared the pandemic over.
- McCarthy settled for eliminating less than $2 billion of the $87 billion IRS funding for 87,000 new agents the Republicans wanted nixed.
- Republicans have touted a victory for reinstituting workfare for food stamp benefits by tightening the eligibility thresholds and enforcement mechanisms. But historically, the states have gamed the requirements through rigged reporting and likely will continue to do so. What’s more, the Republicans failed to win workfare for the much larger Medicaid program. This is progress for the nation’s moral fabric, but provides little toward alleviating the debt. Nonetheless, employers still desperate to find workers in the wake of the pandemic will get some relief.
- The current agreement ends Biden’s moratorium for student debt repayments, but only for this summer. His overall proposed $400 billion forgiveness is pending a likely Supreme Court decision against its constitutionality.
- Republicans achieved a defense spending increase, but less than the rate of inflation. In view of the growing China threat and the diminished state of the U.S. military, this is troublesome.
The Biden-McCarthy proposal is a long way from the president’s original insistence on a “clean bill” (no spending cuts) without negotiation. But that is the way the process works. Ask for the moon and hope for Palm Springs. However, it looks like McCarthy settled for Cleveland.
The final bill is pending the Senate vote amid much Democratic demagoguery about default, as occurred in the House. In any case, the upcoming appropriations process will provide carrot and stick leverage for extracting cuts through Republican votes to fund or defund particular agencies. What’s more, if Congress does not pass the 12 appropriations bills by year-end, an across-the-board 1% cut applies to all discretionary spending. This prevents an alternative wasteful omnibus spending bill favored by Democrats. Progress noted.
The economics
Democrats, and even some Republicans, tend to believe that the U.S. can borrow without limit. Contributing to this notion was the near 15-year period of corrective, then wonton, spending and borrowing following the Great Financial Crisis that induced little inflation. That experience gave rise to the new Modern Monetary Theory that posits the Federal Reserve may create any amount of money to fund unlimited Treasury debt.
However, while inflation was contained in the real economy because of languishing consumption and production, it raged in the financial markets as stock and bond prices soared. This was a result of investors en masse seeking higher returns to escape near-zero interest rates in banks and money markets. Then the multitrillion-dollars of new spending by the Biden administration, also accommodated by the Fed, spawned 40-year high inflation in the real economy. In response, the Fed aggressively raised its benchmark interest rate, which brought down inflation and redirected capital from financial assets back to the real economy, aiding a return to normalcy.
Another reason why the U.S. has been able to issue so much debt on demand is the government’s inviolable faith and credit evidenced by never having defaulted on its bonds. The global investor confidence that inspires, buttressed by a sound economy and strong institutions, contributes to the world reserve status of the dollar, which also attracts massive investment in U.S. treasuries. Liberals believe this track record justifies virtually unlimited debt, despite associated interest consuming a growing share of the budget because of the government’s voracious appetite for capital.
The politics
Getting control of the burgeoning debt and avoiding its economic and geopolitical consequences will take many years, and will depend largely on having control of the presidency and both chambers of congress. The savings contained in the Biden-McCarthy agreement does not put even a dent in the fiscal problem. Oh, it is a start, but we need orders of magnitude more – even as a start.
This failure to contain spending materially will ensure continued inflationary pressures that will hamper real economic growth and structurally weaken the dollar. The best prospect for relief is a Republican controlled government that would pass legislation that restricts spending to a reasonable percent of GDP.
Conservative Republicans have to reach critical mass as they shed RINOS from the party, just as Democrats have jettisoned its moderates. Democrats are not likely to relent in their effort to convert the nation to a socialist state without a series of thorough rebukes at the polls. Is the American electorate up to that task, given heavily leftist mass media that buries truth through silence, obfuscation and censorship?
The debt crisis is too abstract and remote for most Americans to appreciate. The solution is up to responsible representatives in government consistent with the founding principles of the Republic. But as Ben Franklin said, “A republic is the best form of government, if you can keep it.” Can the people and their proxies in government maintain it?
Economic disaster undermines the quality of life and amplifies vulnerability to war. As such, it can catalyze salutary radical change. Will it take a significantly diminished standard of living that invites increasingly compelling metaphorical comparisons with Venezuela to recognize the danger of the looming fiscal threat? That peril combines with open borders, radicalized institutions and social ills, all deliberately created by the Left embodied by the Democrat Party to destroy the nation. National bankruptcy and economic stagflation through excessive borrowing is one of the many means by which to accomplish that.
©2023 William J. Dodwell
By William J. Dodwell May 18, 20223
Once again, government, media and investors fret over raising the federal borrowing limit amid exaggerated fears of default and ensuing Armageddon. The Treasury reached the $31.4 trillion ceiling in January but has relied since on existing cash to pay obligations. However, Treasury Secretary Janet Yellen says those funds will run out on June 1st.
As such, acute concern centers on the government’s ability to roll over Treasury bills coming due after June 1st, that is, sell enough new bills to replace the maturing ones. Investor skittishness about default absent an increase in the debt limit has dampened demand for new issues. A successful rollover provides new cash to redeem maturing debt and has no effect on the limit. Without a rollover, cash is not available to retire old paper, hence potential default.
Some $5.6 trillion resides in money market funds that consist largely of short-term federal debt, some exclusively so. Much of that money is a result of investors moving funds in the last year out of banks to capture much higher market yields caused by the Fed’s interest-rate hikes aimed at combating inflation. But current anxiety about imminent default on short-term debt has prompted some investors to move money back to banks, and others not to buy, raising certain T-Bill yields to almost 6% recently. Financial sage, Warren Buffet, says the risk of default here does not warrant this action.
Of course, Treasury could offer a high enough interest rate to attract buyers of new issues. Also, the Fed could purchase new debt as a lender of last resort. Or, the government could shut down to conserve cash for debt payments.
In any case, there are plenty of government funds from tax collections to service the debt, as well as pay high priority bills without issuing new debt. The Treasury could defer lesser obligations as necessary pending funds availability from spending cuts, tax increases, or eventual new debt issuance. Democrats oppose using tax revenues in lieu of debt to pay incurred liabilities because that is at the expense of earmarked spending. They want a “clean bill” that authorizes raising the debt ceiling with no conditions.
As usual, Democrats and their allies in mainstream media demagogue the issue to avoid spending cuts as much as possible in the debt negotiations. House Speaker, Kevin McCarthy, has presented the Republican proposal that raises the debt ceiling $1.5 trillion in exchange for $4.5 trillion of expense reduction. This includes: keeping discretionary spending at 2022 levels and a 1% cap on annual spending growth thereafter; revoking climate-change provisions of the Inflation Reduction Act; returning unspent Covid funds to the Treasury; work for welfare; rescinding funds for the hiring of 87,000 new IRS agents; and nixing Biden’s executive action concerning student loan relief. The question is what small percent of this excellent offering the Democrats will agree to. And, how many Republicans will cave to only slight concessions by Democrats.
Both Democrats and Republicans believe default is prohibitive, as it would precipitate mass panic and seismic political repercussions. Many millions of individuals would suffer sizable haircuts on savings. Global contagion would spread among financial institutions as they incur write-downs of government securities positions and collateral, and fail to deliver on counterparty obligations. Confidence in the financial system would plummet increasing the cost of debt henceforth, while triggering a radical decline in capital flows essential to economic vitality.
However, freezing the debt ceiling would impose significant fiscal discipline in the face of a $31.7 trillion liability that could force spending cuts formerly off the table. Given sufficient resistance to tax increases, one might say default is the only way to overcome the deleterious politics that precludes solutions to the debt problem that increasingly undermines potential growth. President Trump in his CNN town hall interview last week suggested he would contemplate default in the current circumstance to avoid a much worse one in the future borne of continued unchecked profligacy. That is a courageous public statement.
As always, Congress and the president will raise the debt ceiling after a period of brinkmanship. After refusing to negotiate for months, insisting on no concessions, President Biden has finally relented, even canceling a foreign trip to participate in negotiations as the dubious June 1st apocalypse looms. Both sides have ruled out default. But in the overall scheme of things, that might not be a bad option. 5/18/23
©2023 William J. Dodwell
HAS LGBTQ WOKENESS INTERFERED WITH THE INVESTIGATION OF THE SILICONE VALLEY BANK FAILURE?
By William J. Dodwell May 8, 2023
Are regulators and media protecting Mary C. Daly, the president and CEO of the Federal Reserve Bank of San Francisco, amid the post-mortem of Silicon Valley Bank’s collapse? Even though she is the key figure associated with the debacle who had direct regulatory responsibility for the failed bank, the House Oversight Committee investigating the event did not call her to testify. Rather, it only sent her a letter requesting documents and relied chiefly on the testimony of Charles Barr, the overall Fed regulatory head residing in Washington DC. Nor does the media cite Daly personally in respect of the fiasco. By my observation, there has been no curiosity concerning Ms. Daly’s deafening silence about the bank failure.
Is this because she is an avowed lesbian, a sacrosanct status in today’s atmosphere of ultra-wokeness? The case is similar to Audrey Hale, the self-identified transsexual who recently committed mass murder in Tennessee. The police still withhold her manifesto from the public because of suspected content that might invite backlash against her sexuality demographic.
A startling example of Ms. Daly’s seeming protection is evident in the May 8, 2023 issue of Barron’s that features an article by Thomas Hoenig, “Will the Fed Be Ready If More Banks Fail?” The piece criticizes Barr’s report of findings for skirting the malfeasance of the San Francisco Fed with respect to its decisions and communications concerning the problems at SVB. But, while Hoenig raises important questions about the role of the San Francisco office, he glaringly omits any mention of Mary Daly by name, consistent with general media reporting on the issue.
Or, is Mary Daly getting special treatment because of her obsessive crusade for diversity, climate change policy and the rest of the ESG canon? Many have suggested this distraction was instrumental in the SVB regulatory lapse, again without mentioning Daly’s name. Was she pressured to resist adding operating constraints to keep loans flowing to risky cash-hungry start-ups of wealthy clientele, many of whom are major Democratic donors? The FDIC’s decision to protect exclusively SVB’s many sizable uninsured deposits of those elites suggests partisanship.
The supposed protection of Mary Daly invokes a similar case: the suspected shielding of Jamie Gorelick by the 9/11 Commission and the body politic. Gorelick as deputy attorney general in the Clinton administration issued a memo in 1995 calling for greater separation between the CIA and the FBI that forbade the sharing of intelligence information with criminal investigators. Many believe this created communication silos that contributed to a vulnerability that permitted the 9/11 attack. Ironically, Gorelick was a member of the 9/11 Commission, and therefore never held to account for this calamitous indiscretion.
Specifically, a Defense Department intelligence unit called Able Danger, which explored communications breakdown between the CIA and FBI, claimed it identified a few of the 9/11 terrorists more than a year before the attack. However, Able Danger, on orders of government lawyers, never sent this information to the FBI consistent with Gorelick’s 1995 directive. Is there a connection? In addition, the 9/ll Commission downplayed the Able Danger finding, seemingly to protect Jamie Gorelick.
So serious was this issue that Pennsylvania Republican Congressman, Curt Weldon, on the House floor aggressively urged a probe of Able Danger in 2005. The Defense Department resisted the investigation. What’s more, his persistence made him a target, a fate that ultimately sabotaged his reelection for an 11th term. The 9/11 Commission made no mention of Able Danger or the Gorelick memo in its report. Was this bombshell suppressed to prevent possibly pinning the 9/11 disaster on a woman?
One might ask why woke mainstream media does not protect American Federation of Teachers president Randi Weingarten from the vilification she endures for closing classrooms so long during the Covid pandemic, and for fostering leftist indoctrination in in the schools. In fact, she has claimed she suffers public scorn because she is Jewish and a woman.
The reason she is hung out to dry is that her transgression is more tangible and pervasive inasmuch as it affects children and their parents everywhere. Ms. Weingarten has been called evil incarnate and is now universally despised. This much opprobrium is too formidable to protect against, even for dedicated wokesters. To do so would extend the enmity to her defenders.
Identity politics is a common tool of the Left to garner power by silencing critics. It produces bad outcomes whether gratuitously promoting protected classes or exempting them from wrongdoing. In the case of investigations, that practice gets in the way of truth.
©2023 William J. Dodwell
by William J. Dodwell
THE SHORT EVOLUTION OF THE DEMOCRATIC LURCH TO THE FAR LEFT
By William J. Dodwell March 20, 2023
Many wonder how Democrat politics has gotten so bad so fast. The advocacy and policies of the Democrat Party in its sudden lurch to the far left have shocked the nation. They probably alarm even most Democrats, notwithstanding their perverse loyalty at the ballot box. Here is how this seismic ideological shift has evolved in just the last several years.
Democrat sins
There is virtually no room for moderates in the Democrat Party anymore. The new party espouses unprecedented extremes that undermine traditional social, cultural and economic standards that aim to destroy America. Tactics include the following pathologies:
open borders
weakened law enforcement
reckless spending and debt
abortion up to the time of birth
a cult-like obsession with climate-change
politicized authoritarian dictates and dissent suppression concerning Covid 19
mutilation of children in the name of transgender politics
a neurotic fixation on race to divide America
leftist indoctrination and abandonment of academic standards in schools and colleges
the targeting of conservatives by the FBI, DOJ, DHS, and the CIA
government restraint on conservative speech in collusion with Big Tech
a politicized military
a tyrannical executive branch
a politicized judiciary
systemic election fraud
The Left continues to push the envelope toward radical policies with little resistance. Its zeal for control was evident in government authoritarian practices during the Covid pandemic in contravention to dissenting scientific views. At the state level, Democrat governors mandated the most austere Covid policies.
The Democrat Party promotes identity politics in the extreme through a new wokeness that pervades all institutions, and pushes a tyrannical progressive agenda. The Left strives to control language and behavior in a governmental effort to divide and conquer the citizenry, abetted by the newly corrupt media. The ultimate goal: to destroy America and reconstitute it as a globalist socialist state.
Corrupt mass media
Gone is the once sacrosanct “fourth estate” that used to be relied on for objective reporting and speaking truth to power. Today mass media is a handmaiden of the Democrat Party in its effort to transition to the new order. That media ignore President Biden’s past influence peddling corroborated by his son Hunter’s laptop contents. The media have created a virtual news blackout of the chaos at the southern border caused by Biden’s open border policy conducted in direct contravention of the law. The January 6 sham congressional investigation was unchallenged by the media.
And the media were wholly complicit in perpetrating a false government narrative about Covid 19 that ignored real science. That propaganda spread lies about the threat of the virus, the efficacy of mitigation protocols, especially as it relates to school closures, the value of therapeutics such as hydroxychloride and Ivermectin, and the necessity, effectiveness and safety of vaccines.
The origins of the transformation
The lurch to the radical left started in the Obama administration premised on his expressed desire “to transform America”. In particular, the Department of Justice became hyper-politicized under AG Eric Holder as he filled the ranks with permanent avowed leftists. Former AG Mukasey under President George W. Bush said that these activists even hung posters of Marxist revolutionary Che Guevara on the wall. In addition, Obama’s IRS blocked approval of conservative groups seeking standard tax exemption. This climate does not bode well for equal justice. Indeed, the rule of law is under siege.
Most reprehensible was the complicity of the Justice Department and FBI in advancing allegations that candidate Trump colluded with Russia. To that end, they knowingly presented fabricated evidence to the FISA court to get permission to surveil him. This ruse continued even after Trump took office in an effort to depose him. Of course, the Russia collusion story has been completely debunked.
The Trump factor
The principal impetus to the radicalization of the Democrat Party was the emergence of Donald Trump and his bid for the presidency in 2015. His unspeakable frank talk against the sacred cows of the Left and its agenda constituted an unprecedented threat that galvanized a Democratic effort to block him. Even establishment Republicans disliked him. Recall that after the party “post-mortem” following the 2012 loss to Obama, Republicans were poised to moderate. In particular, it planned a more conciliatory stance toward immigration. But Trump arrived and went in the exact opposite direction to the dismay of the “It’s not who we are.” RINOS.
In the face of Republican cowardice, Trump spoke plainly about rapists, murderers and drug traffickers crossing the border and his determination to stop them by building a wall. He called the climate change agenda a hoax. He was the first to challenge decades-long trade deals grossly unfair to the U.S., especially with China. He called for massive deregulation that weakened the power of the administrative state (the swamp), and he advocated across-the-board tax cuts. He eliminated Obama’s outrageously restrictive rules of engagement on the battle field against ISIS and consequently dissolved that enemy in short order.
All of this gravely threatened the liberal establishment like never before. Democratic hatred for Trump led to the orchestrated rigging of the 2020 presidential election results that removed him. Over 60 judges refused to adjudicate abundant evidence of fraud out of fear of retaliation by the Left.
Now Trump is running for president again. The Left is panicking as there is no compelling Democrat opposition and Biden’s record is a disaster.
Call to action
What will the Democrat Party do? You can bet that election fraud is at the top of the agenda. Democrats will do anything to stop Trump again and will get the full support of the corrupt media. They are utterly devoid of integrity. After all, they are leftists.
As such, Republicans have to galvanize in unprecedented resistance. They must scrutinize and publicize the performance record of candidates at all levels of government who appear amenable to the Left’s Marxist advance, including RINOs. Then Republicans have to translate that exposure into massive opposition turnout at the ballot box. In view of the Biden malaise, many independents and even Democrats are likely persuadable.
The Right must invoke Archimedes’ law of physics against the Left: For every action, there is an equal and opposite reaction. As the Democrats have moved far left, the Republicans ought to move commensurately right. Too much compromise moves the center to the left as Democrats try to normalize their extremes.
©2023 William J. Dodwell
By William J. Dodwell March 16, 2023
For some, the failure of the Silicone Valley Bank invokes an inaccurate comparison to the 2008 financial crisis. But a reasonable analogy compares SVB with the raft of savings and loan bank insolvencies in the 1980s. Let’s look at the parallels.
Silicone Valley Bank
SVB failed because of mismanaged interest-rate and duration risk from investing short-term deposits in long-term treasuries and agency mortgage-backed securities to achieve a little extra yield during a decade of very low interest rates. When the Fed eventually executed a series of ongoing rate increases to combat inflation, the value of the bank’s long-term assets axiomatically declined significantly because of their more interest-rate sensitive durations that the bank did not hedge.
Consequently, SVB raised less money from the sale of securities to satisfy deposit withdrawals. Hence, a liquidity squeeze and a run on the bank when the problem became public. What’s more, the forced selling of bank securities compounded the price declines and concomitant realized capital losses.
SVB was extremely remiss in not shortening durations in its portfolio, or adopting hedges, to avoid the inevitable capital losses on long-term fixed-income assets. The bank should have expected the losses from well-anticipated Fed rate hikes. The problem was a lapse in basic risk management, not an arcane derivative strategy gone awry or a wave of defaults like past financial fiascos.
SVB was apparently unaware of the magnitude of its unrealized portfolio losses because it classified the bulk of its securities as “held-to-maturity”. According to regulation, the bank does not have to mark these assets to market in its financial reporting.
If the bank had classified most of its bonds “available-for-sale”, regulation requires it to mark them to market. Then the significant capital losses from rising interest rates would have been transparent, prompting the bank to shorten portfolio durations and greatly avoid those losses. Since the deposit base belonged predominately to start-up technology companies in constant need of capital, SVB should have known to classify securities “available-for-sale” to correspond to deposits subject to regular withdrawal.
SVB has long touted woke policies as an advocate for ESG investing, LGBT activism, and internal obsessiveness over climate change and diversity. Many speculate whether this distraction might have been at the expense of portfolio due diligence. Astonishingly, a similarly woke San Francisco Fed did not detect the glaring anomalies in its supervisory examinations.
At present, the FDIC is trying to sell SVB via auction. If unsuccessful, it will dissolve the bank through a distribution of assets. SVB with $200 billion of assets is the largest bank failure, second to Washington Mutual with $300 billion that failed during the Great Financial Crisis. Signature Bank, also whipsawed by Fed rate hikes, is the third largest failure with $100 billion of assets.
Regional bank stocks have fallen dramatically as contagion fear generated widespread deposit withdrawals, even despite sound balance sheets. Prices will likely recover in light of regulatory sensitivity to psychological contagion. The Treasury and the Fed announced unlimited FDIC insurance and loan support afforded SVB and Signature Bank. But more bank failures could be coming. Contagion concern also has developed in Europe amid comparable anti-inflation rate hikes as in the U.S.
The savings &loan debacle
Similar to the SVB duration mismatch of assets and liabilities, savings and loan banks in the 1980s invested short-term variable-rate deposits in fixed-rate mortgages, as well as illiquid real estate. As rising interest rates lowered the value of the mortgages, and property values cratered while deposit rates rose, bank capital eroded leading to rolling insolvencies.
To overcome the inability to service deposit rate increases to remain competitive, one bank duped customers to convert their deposits to long-term bonds, surrendering their federal deposit insurance. The value of those bonds quickly collapsed leaving the bondholders devastated (until a federal bailout).
The incentive to commit to a mismatched balance sheet centered on expectations of growth and significant property appreciation that would swell bank profits. Unfortunately, the euphoria resulted in politically influenced overdevelopment and lending that dashed that prospect.
Another impetus to risky S&L investing was the increase in the federal deposit insurance limit from $40,000 to $100,000. As a result, a much higher percent of deposit accounts became fully protected. This prompted banks to invest more aggressively knowing that depositors were not at risk.
The federal government created the Resolution Trust Corporation (RTC) that took hundreds of banks into receivership for sale or dissolution over a period of several years. The debacle ultimately cost taxpayers about $125 billion (about $300 billion in today’s dollars).
SVB ‘s extreme exposure to interest-rate risk created losses, insolvency and illiquidity that precipitated a run on the bank. The savings and loan experience was similar where contagion took hold. In both cases, banks mismanaged the balance sheet. Whereas the S&L crisis resulted in a cost to taxpayers, the SVB losses are borne by the bank with help of a loan facility from the Fed, and by the FDIC, that is funded mainly by large banks. But if many more bank failures ensue, the taxpayer will pay once again.
The 2008 financial crisis
The SVB and savings and loan failures were caused by excessive exposure to interest-rate and liquidity risk arising from mismanagement of the asset/liability structure. By contrast, the Great Financial Crisis centered on default risk flowing from lax mortgage lending standards, mainly predicated on federal affordable housing policy aimed at enabling lower income borrowers to achieve home ownership.
An overly long period of low interest rates and a politically induced relaxation of mortgage lending standards caused home prices to soar. When massive defaults ensued because of so many unqualified borrowers, those prices plummeted leaving homeowners with mortgages that exceeded their home values. As such, the home as collateral was “under water”, no longer adequately securing the mortgage.
Multiple trillions of dollars of impaired mortgages circulated throughout the financial system through their packaging into mortgage-backed securities and their subsequent trading. Actual and anticipaed defaults created systemic capital losses because of the intricate interconnectivity of financial institutions. The loss of confidence in the quality of bank-issued mortgage-backed securities, compounded by grossly inflated grading by the rating agencies, triggered massive selling. Agency MBS were guaranteed against default risk by the government which wound up bailing out Fannie Mae and Freddie Mac through an equity contribution of some $190 billion, which was fully repaid.
Like the MBS selling contagion, the SVB crisis displayed to some extent an irrationally driven panic among depositors seeking to withdraw all their funds. But that fear subsided when Treasury Secretary Yellin decided to remove the $250,000 FDIC cap to fully protect all accounts of the failed SVB Bank and Signature Bank. The Fed also pledged loan relief to prevent the banks from having to incur losses in the sale of bonds to meet withdrawals.
Whether this accommodation extends to additional bank failures remains to be seen. Before the FDIC and Fed relief, depositor concern precipitated a massive shift to government securities as a safe haven, bringing down yields a full percentage point.
Of course, the Great Financial Crisis was much larger in scale than the SVB and Signature Bank failures. It involved trillions of dollars of losses in a wide range of asset classes for institutions and individuals. By contrast, the current debacle affects mostly companies and employees in the technology sector, mainly venture capital start-ups and crypto currency investors.
FDIC bailout and moral hazard
There is room for a little schadenfreude here. Some might take delight in the fact that most of the current bank failure victims are from Big Tech. Perhaps this class experienced some bad karma for colluding with government to suppress conservative content in social media. But the removal of the FDIC deposit cap renders this poetic justice academic.
SVB and Signature Bank depositors are largely wealthy technology companies and their employees who donate handsomely to the Democrat Party. Reportedly, they pressured the Biden administration for FDIC relief. One wonders if the Treasury would have extended the deposit insurance accommodation to other classes of victims.
The rescue has spurred debate about the propriety of bailout, especially considering many of the victims are very wealthy risk-taking businesses and individuals who can afford their losses. What’s more, about 90% of SVB depositors had uninsured deposits in excess of the $250,000 FDIC limit. One company kept nearly $500 million on deposit. Should they not be responsible for mismanaging their funds?
Gratuitous government intervention fosters dangerous moral hazard. It engenders expectations of future relief as needed, incentivizing wasteful risky bank investing and relaxed due diligence. However, damage on the scale of the SVB failure could precipitate contagion that poses a systemic threat to the financial system if rules are not bent. Dodd-Frank aimed to prevent the need for bailouts among the largest banks, but nobody anticipated smaller regional bank failures also could be systemically precarious. We learn that they also can be too big to fail.
Moral hazard notwithstanding, special fiscal and monetary liquidity infusions in dire emergencies can save the financial system and the economy. Certainly, that is true in the wake of the 1987 stock market crash, 9/11, the 2008 financial crisis, and, albeit overdone, the Covid pandemic.
The FDIC will conduct the bailout, depending mostly on big bank contributions to the fund. If recipients deplete the fund, taxpayers will cover the remaining claims. To have the ability to insure deposits in the future, possibly under a more accommodating claim standard, banks will pay higher FDIC fees that they will pass on to customers in the form of new bank charges and reduced services.
Moral hazard from bailouts can eventually invite recklessness, fraud and inflation that give rise to more catastrophes and rescues. Bank safety requires vigilance and accountability on the part of banks, regulators and customers to prevent bank failure in the first place. Then massive expensive bailouts become moot.
This government intervention has stanched contagion fears so far. But it remains to be seen whether more banks failed to manage their interest-rate risk in the face of the Fed’s inflation-fighting tightening. If so, more bank runs may be in store and taxpayers will be on the hook if FDIC funds run out.
©2023 William J. Dodwell
By William J. Dodwell February 20, 2023
Winston Churchill famously declared, “Democracy is the worst form of government, except for all the others.” Today, the vulnerability of democracy in America is perhaps more evident than ever as the progressive agenda takes hold. Paradoxically, while free elections endure, the gulf between government representation and the public interest looms large because of anomalies both in government and among the governed.
The leftist juggernaut
The Democrat Party’s successful lurch to the far-Left in recent years does not comport with the nation’s true convictions, elections notwithstanding. Rather, the rapid advance of Marxist ideology in government is the result of aggressive maneuvering by the Democrat Party that has rid itself of moderates almost entirely, diminishing voter choice. At the same time, its allies in the corrupt and protective mass media foster an uninformed and apathetic electorate through propaganda and news blackouts. In addition, corporate America, Big Tech, academe and even the military embrace the new socialist agenda. Following suit, the schools have discontinued the study of American history and its founding principles. In their place, they teach a grossly distorted anti-America version based on “critical race theory” (CRT). All these institutions to some degree sympathize with the Left’s effort to dismantle the republic in favor of a new socialist state.
The pervasive denigration of our meritocratic traditions and the corruption of institutions has inured the public to undemocratic injustices including: Government pressuring cable television providers to drop conservative networks; Legislative complicity in accommodating systemic election fraud; and government suppression of truth about Covid to empower itself and enrich its operatives through mandates and indiscriminate vaccine sales. In addition, renegade and compromised attorneys general, duly elected to enforce the law, decriminalize many serious offenses and generally relax prosecution.
Many citizens acquiesce to the absurd energy agenda of elected officials forged in the name of climate-change. They also might resign themselves to open borders, rampant crime and homelessness, educational decay and indoctrination, despite their opposition. They also adhere to disarming wokeness concerning race, sexuality and transgenderism rooted in unbridled identity politics, notwithstanding their aversion to these ideologies.
What’s more, campaign funds provided by far-left billionaires subvert the will of the people. Unlike Democrats, Republican billionaires do not donate to facilitate rigged elections (Mark Zuckerberg), or to pay off candidates for attorney general (George Soros) to help destroy the nation through crime. The Left is hell-bent on continually pushing the envelope in a bold disregard for the Constitution in order to foist socialism on the citizenry. As democracy recedes, tyranny and public apathy ascend.
Societal moral decline
Alas, this wanton lawless approach of the Left is working. In part, it is reflective of diminished societal integrity personified by the heralded dishonesty of Presidents Clinton, Obama and Biden. Seemingly, more common criminal behavior in the private sector also exemplifies the malaise as Bernie Madoff, Elizabeth Holmes, and allegedly, Sam Bankman-Fried demonstrated. Collectively, this behavior breeds a culture of venality that is especially dangerous in government as it impinges on so much that affects the wellbeing of the nation. Public distrust in government inevitably ensues.
FBI collusion with Big Tech to quash conservative content in social media constitutes a grave threat to democracy that generates distrust of government. A particular impetus to today’s Democratic intransigence is the party’s intense hatred for Donald Trump who progressives see as a serious danger to the leftist agenda as shown by his policies and actions as president. The supposedly apolitical FBI’s reckless effort to derail his candidacy and presidency through its Crossfire Hurricane initiative shockingly undermined democracy. The Left is viscerally determined to prevent another term for Trump or anyone like him in the future.
Perhaps more than ever, the aforementioned integrity deficit has engendered a go-along-to-get-along mentality that pervades government at all levels. Shirking their fiduciary duty, elected officials succumb to lobbyists, peer pressure, threats, and media vilification. They accept bribes and kickbacks. In local government especially, liberal Democrats sometimes run as moderate or conservative Republicans to get elected. Then they govern as leftists.
Legislative leadership denies representatives time to read bills, inviting toxic undemocratic inserts in the dead of night. At worst, unethical politicians create a rubber-stamp government dedicated to self-interest that ultimately results in one-party rule, as in the case of California, New York and Illinois. And the people be damned. Unaware of this nefarious charade behind the scenes, the voters elect and reelect the scoundrels.
The Democrat Party and the imperious administrative state
Democrats often cite Republican policies as “a threat to democracy”. Their protestations refer to such Republican positions regarding: Voter ID to ensure election integrity; Parents objecting to outrageous student curricula at school board meetings; Calls to adjudicate in court abundant documented evidence of determinative fraud in the 2020 presidential election; The one-sided sham congressional investigation of the January 6 incident; and the upholding of constitutional rights. Of course, Democratic tyranny is the true threat to democracy. Accusations against the Republicans are pure projection.
Has a too-powerful executive branch contributed to the erosion of democracy? Over time, tremendous incremental power has accrued to unelected bureaucrats in government agencies serving the chief executive, especially in Democratic administrations. Through executive orders and the rulemaking process applied to the implementation of legislation, these operatives can enact policy that could not pass in the legislature. Oftentimes, the legislature is deliberately vague in writing the law to avoid taking a particular political stand. It then defers to the enforcement judgement of unelected agencies to work out the sensitive details. Similarly, the judiciary may defer to executive branch expertise to assess the practical application of the law, often resulting in regulatory overreach. The upshot: Too much power residing in the administrative state to its political advantage and to the people’s detriment.
Often, the result has been tyrannical policies that were never intended in the legislation passed by representatives of the people. Examples are imperious lawsuits and fines imposed by the administrative agencies that bankrupt the victims, or at least intimidate them into compliance with extreme mandates.
This is how the Environmental Protection Agency can charge a citizen some $37,000 a day until he disposes of a puddle it deems a “wetland”. It is how the Consumer Financial Protection Board can force communities to develop “affordable housing” units aimed at transforming suburbia by effectively merging it with the inner cities. It is how government can mandate the transition to electric vehicles, or ban gas stoves, notwithstanding the costs and inconveniences, or the lack of even a modicum of interest on the part of the public.
Restoring self-government
Government power has circumvented the will of the people. It is time to restore self-government lost amid the shift to socialism and tyranny. Our freedom is sacrosanct. Most Americans want it, but are too diffident, uninformed or apathetic to fight for it. Ideally, government would safeguard freedom by shrinking and reverting to its originally intended role under the Constitution and Bill of Rights. But it is up to the electorate to effectuate this change through education, peaceable activism in media and social discourse in a mass exercise of persuasion, combined with voting power to ensure the right people represent the nation.
Benjamin Franklin said when asked by a citizen what kind of government he and his fellow Founders had just created in 1787, “A republic, if you can keep it.” He knew that the diversity of interests, prejudices and passions of a new nation amid constantly changing conditions made the continuance of the republic questionable. But he also recognized that the people’s common values, especially freedom achieved through a brutal war, would help to ensure the longevity of the republic.
Today, we face an inflection point inasmuch as imperial government and its progressive agenda truly threaten our democracy. Democracy is a function of government and the governed. Over time, adjustments may be necessary on either side of the equation. When the people run afoul, the state intervenes according to the rule of law and its regulatory powers established by their elected representatives and their selected operatives. When the government gets out of hand, the people must summon the mettle to correct the course through their voting power and their freedom to communicate freely, and conduct orderly and lawful protest to preserve their right to self-determination. It is at this juncture we now stand.
But the institutional checks and balances in the legislatures, the courts and the enforcement apparatus seem to have been largely compromised through a blanket wokeness and excess conformity with the Left’s agenda. It is up to the people to break the logjam. As Franklin believed, a republic is a good form of government - if we can keep it. It is up to us.
© 2023 William J. Dodwell
RIP GINA LOLLOBRIGIDA
Film star and sex bomb, Gina Lollobrigida, just died at 95. A mammary queen, her semi-nude poster graced my wall in the late 1950s, along with those of Marilyn Monroe, Brigitte Bardot, Jayne Mansfield and Jane Russell. I’m sure I speak for many of my male contemporaries who would say, “Those ladies made a man of me at an early age.”
F**k you, #MeToo. 1/17/23
By William J. Dodwell November 29, 2022
Republican and conservative media increasingly abandon their former standard-bearer as his successful presidency recedes from memory. This, despite its stark contrast to the utter travesties of the current administration. In fact, Donald Trump seems suddenly to have become anathema in new quarters of his party.
Orchestrated attack
Media mogul, Rupert Murdock, recently commanded all the writers and broadcasters employed by his properties, including the conservative Wall Street Journal, New York Post, and Fox News, to denigrate Trump’s presidential prospects for 2024. On cue, they dutifully acted in lock step concocting any kind of Trump-bashing they could muster. So much for journalistic integrity and independence. Indeed, it was blatant prostitution. (To be fair, they would have been fired if they did not comply.)
The most common theme among Trump’s new critics concerns his candidate endorsements in the 2022 midterm elections. They say too many of his picks disappointed in the general election because they were too radical, according to exit polls. Republican operatives believe certain other candidates could have won, especially given Biden’s atrocious performance. In fact, 91% of Trump’s 254 endorsements won their races, but critics point out his record was lackluster in competitive contests. Let’s examine this theory.
The midterm elections
The election results, while below expectations, were hardly a mass repudiation of Trump inasmuch as Republicans retook control of the House and missed a Senate majority by a whisker. Some losses in key races were quite narrow. Kari Lake’s tentative defeat for AZ governor and Adam Laxalt’s NV senate loss were by less than 1%. Herschel Walker lost the GA senate race by less than 1% with a runoff scheduled for December 6th. A libertarian spoiler likely siphoned his 2% from Walker’s tally denying him a victory in the first round.
Yes, there were some disasters. Douglas Mastriano, a rock-ribbed conservative endorsed by Trump, lost the PA governor race by 15 points. Go figure. Maybe he was too macho for today’s feminized populace.
Exit polls indicating candidates were too radical derived from small samples. Kari Lake is still challenging her loss. Testimony of witnesses and circumstantial evidence in Arizona suggest highly suspect events. To wit: The printing capability of the pre-tested voting machines increasingly failed over the course of the day, breaking down at a 70% rate at the peak. Poll workers told voters affected to deposit their ballots in an open box. Many, not trusting that procedure, went home disenfranchised. This problem also had to have influenced the Blake Masters senate race on the same ballot, although his five-point shortfall was considerably greater than Lake’s.
Many suspect a significant sympathy vote gave stroke victim, John Fetterman, a senate victory in PA. Seriously, how could such an ultra-leftist win in light of an abysmally poor campaign performance in a relatively conservative state, excepting Pittsburgh and Philadelphia? Critics say his Republican opponent, Mehmet Oz, as a physician, was an “elitist” who did not mesh with the largely working class electorate. But Donald Trump is a multibillionaire who has done pretty well with that demographic. Some say Oz did not campaign well. How so? His articulate comprehensive presentations were impressive, especially in contrast to Fetterman’s unintelligible deliveries. Was Oz’s ethnicity a factor?
In any case, is a vote against a Republican in the midterm elections necessarily a referendum on Trump in 2024? Trump’s Republican detractors are pushing that narrative. But his presence as a presidential candidate on the ballot is much more powerful than as an attempted king maker in an off year election when the memory of his successes are out of focus for many. President Clinton won reelection in 1996 after a record repudiation of House Democrats in the 1994 midterms. So did President Obama in 2012 in the wake of the equally disastrous 2010 house cleaning. (Pun intended.)
Trump supporters point to the Democrats’ huge campaign funding advantage in the midterm elections. Exacerbating this problem was GOP Senate Minority Leader Mitch McConnell’s injudicious allocation of monies to candidates helpful to him personally at the expense of some good conservatives. How much did Democrat candidates benefit from government Covid stimulus funds allegedly re-routed from the teachers’ unions and state and local entities to the Democratic National Committee?
Why the mutiny?
Why are so many Republicans and conservatives suddenly forsaking Trump? Initially, the coordinated assaults aimed at deterring him from running again in order to make room for fresher candidates. But he represents their values and proved it as president. He stands for upholding the Constitution, border security, the rule of law, etc., and incorporated these ideals in his policies. But Trump’s critics ignore his stellar presidential achievements in their quest to block his return.
On the other hand, many express fatigue from his combative personality and attendant disorder. How does civility supersede his successful presidential record largely predicated on that style? A milquetoast president likely would not have accomplished what Trump did. Trump’s Republican opponents fear he would lose in 2024 and bring down other Republicans in the process. Thus, they call for new candidates. At the same time, Democrats think Trump could win. So, he gets blasted from both sides.
Is the “election denier” label scaring people off?
Some Republicans think support for Trump will brand them a dreaded 2020 “election denier” in a guilt-by-association connection, given Trump’s persistent claim that election was illegitimate. The moniker is becoming a scarlet letter for candidates. Such are the politics of intimidation fostered by Democrats, government and media today – and the diffidence of Republicans.
Cutting through the anti-Trump hype
What is the true electoral appetite for Trump’s recently announced 2024 run? The 2016 novelty has diminished. Trump fatigue is a factor. His age is a minus. But his conservatism remains, underscored by his presidential successes that distinguish him from any opponent. That record should override his negatives for principled Republicans, and even some Democrats. And, it highlights the outrageous policies of the Biden administration as to accentuate Democratic vulnerability. Contrary to Republican media hype, the 2022 midterm disappointments were not the Trump referendum many party powers-that-be claim.
Deep bench for the GOP
The GOP anti-Trump faction believes there are younger more palatable presidential candidates lacking Trump’s baggage that they believe could doom him in the 2024 election. Alternatives include conservatives Florida Governor Ron DeSantis, notably, as well as former Trump Secretary of State, Mike Pompeo, and Arkansas Senator Tom Cotton. They are great candidates, but Republicans should save one of them for two terms following another Trump stint. That would make potentially three successive terms, or more, to restore and entrench the conservative agenda.
Unfortunately, a constant Republican anti-Trump drumbeat for two more years could erode his support regardless of the merits and doom his candidacy.
©2022 William J. Dodwell
by William J. Dodwell
WHAT’S WRONG WITH ELON MUSK? First, he grossly overpaid for Twitter. Then he tried to back out of the deal after failing to do due diligence beforehand about well-known false accounts, but legal obstacles overcame him. On taking over, he properly fired the CEO, CFO and chief legal counsel, and terminated about half of the employees. He released a treasure trove of emails affirming already suspected internal cooperation with government officials to censor conservative content. Of particular note, is the Hunter Biden laptop story, the suppression of which changed the outcome of the 2020 presidential election according to polls.
Musk announced he will step down when he stabilizes the company. Then he said he would leave on the basis of a user vote. He said that Twitter distracted him from running Tesla and SpaceX, even though he knew that from the start. Now he says he will depart when he finds someone “foolish enough” to take his job.
What’s wrong with his guy? The line between genius and madness can be thin. Let’s hope Musk gets his head together to deliver the transformation conservatives have been eagerly expecting in the name of free speech. He must not disappoint. This could be a huge blow to the Left that reduces similar content restriction in other social media, including LinkedIn.
Next year, Republican-led congressional hearings will examine the government nexus with Big Tech employed as a proxy to skirt First Amendment free speech rights. This symbiosis has nefarious implications beyond Twitter. It invites scrutiny of a larger government-corporate collaboration aimed at extending the tyrannical reach of the public sector to employees and customers. At stake are overt and covert government mandates and the freedom-destroying woke agenda.
We need a stable Elon Musk to launch the opening salvo in forging the resistance to the growing usurpation of our Constitutional rights. 12/22/22
A CHRISTMAS OFFERING. Merry Christmas. Here I have fun on the piano with my arrangement of “Jingle Bells”. https://youtu.be/VhqXsSg4W5Q Enjoy this as a momentary palliative against the stress from the woeful state of the body politic. 12/19/22
THE INFLATION TRAJECTORY. Inflation may have peaked, thanks to Fed tightening and the declining M2 money supply that had been extremely high. November inflation was 7.1%, down from a June high of 9.1%. But the question is how low can inflation get and over what time horizon.
Contributing to lower inflation is the continued abatement of supply-chain logjams. In addition, less bank lending amid a sharp recession next year will curtail spending. However, banks will invest more in treasuries and mortgage-backed securities that will suppress bond yields to encourage borrowing/spending, thus counteracting the Fed’s quantitative tightening.
Also bolstering inflation are labor shortages resulting from continued government pandemic accommodations that discourage work. They include extended unemployment benefits, free or subsidized health care, liberal distribution of food stamps, extended child tax credits, and expanded Medicaid largesse. The resulting low labor participation rate limits production in the economy in the face of still considerable demand. Hence, labor shortages combine with general inflation to force employers to raise wages.
Trillions of dollars of new government spending has yet to permeate the economy. As it does, it will create inflationary pressures. So might the coming details of the omnibus bill just forged by Congress to avert a government shutdown in the absence of a fiscal 2023 budget.
So, inflation has come down but incremental disinflation will be harder to achieve. In fact, the Fed’s original 2% target seems chimerical. The Fed ought not to relent on rate hikes. And, if only Biden would lift restrictions on oil and gas development, half the problem would disappear. Alas, that is not going to happen until a Republican is in the White House. Perhaps the most effective inflation antidote would be a hard dose of recession. 12/15/22
GROWING REPUBLICAN TRUMP-BASHING. Republican and conservative media increasingly abandon their former standard-bearer as his successful presidency recedes from memory. This, despite its stark contrast to the utter travesties of the current administration. In fact, Donald Trump seems suddenly to have become anathema in new quarters of his party.
Orchestrated attack
Media mogul, Rupert Murdock, recently commanded all the writers and broadcasters employed by his properties, including the conservative Wall Street Journal, New York Post, and Fox News, to denigrate Trump’s presidential prospects for 2024. On cue, they dutifully acted in lock step concocting any kind of Trump-bashing they could muster. So much for journalistic integrity and independence. Indeed, it was blatant prostitution. (To be fair, they would have been fired if they did not comply.)
The most common theme among Trump’s new critics concerns his candidate endorsements in the 2022 midterm elections. They say too many of his picks disappointed in the general election because they were too radical, according to exit polls. Republican operatives believe certain other candidates could have won, especially given Biden’s atrocious performance. In fact, 91% of Trump’s 254 endorsements won their races, but critics point out his record was lackluster in competitive contests. Let’s examine this theory.
The midterm elections
The election results, while below expectations, were hardly a mass repudiation of Trump inasmuch as Republicans retook control of the House and missed a Senate majority by a whisker. Some losses in key races were quite narrow. Kari Lake’s tentative defeat for AZ governor and Adam Laxalt’s NV senate loss were by less than 1%. Herschel Walker lost the GA senate race by less than 1% with a runoff scheduled for December 6th. A libertarian spoiler likely siphoned his 2% from Walker’s tally denying him a victory in the first round.
Yes, there were some disasters. Douglas Mastriano, a rock-ribbed conservative endorsed by Trump, lost the PA governor race by 15 points. Go figure. Maybe he was too macho for today’s feminized populace.
Exit polls indicating candidates were too radical derived from small samples. Kari Lake is still challenging her loss. Testimony of witnesses and circumstantial evidence in Arizona suggest highly suspect events. To wit: The printing capability of the pre-tested voting machines increasingly failed over the course of the day, breaking down at a 70% rate at the peak. Poll workers told voters affected to deposit their ballots in an open box. Many, not trusting that procedure, went home disenfranchised. This problem also had to have influenced the Blake Masters senate race on the same ballot, although his five-point shortfall was considerably greater than Lake’s.
Many suspect a significant sympathy vote gave stroke victim, John Fetterman, a senate victory in PA. Seriously, how could such an ultra-leftist win in light of an abysmally poor campaign performance in a relatively conservative state, excepting Pittsburgh and Philadelphia? Critics say his Republican opponent, Mehmet Oz, as a physician, was an “elitist” who did not mesh with the largely working class electorate. But Donald Trump is a multibillionaire who has done pretty well with that demographic. Some say Oz did not campaign well. How so? His articulate comprehensive presentations were impressive, especially in contrast to Fetterman’s unintelligible deliveries. Was Oz’s ethnicity a factor?
In any case, is a vote against a Republican in the midterm elections necessarily a referendum on Trump in 2024? Trump’s Republican detractors are pushing that narrative. But his presence as a presidential candidate on the ballot is much more powerful than as an attempted king maker in an off year election when the memory of his successes are out of focus for many. President Clinton won reelection in 1996 after a record repudiation of House Democrats in the 1994 midterms. So did President Obama in 2012 in the wake of the equally disastrous 2010 house cleaning. (Pun intended.)
Trump supporters point to the Democrats’ huge campaign funding advantage in the midterm elections. Exacerbating this problem was GOP Senate Minority Leader Mitch McConnell’s injudicious allocation of monies to candidates helpful to him personally at the expense of some good conservatives. How much did Democrat candidates benefit from government Covid stimulus funds allegedly re-routed from the teachers’ unions and state and local entities to the Democratic National Committee?
Why the mutiny?
Why are so many Republicans and conservatives suddenly forsaking Trump? Initially, the coordinated assaults aimed at deterring him from running again in order to make room for fresher candidates. But he represents their values and proved it as president. He stands for upholding the Constitution, border security, the rule of law, etc., and incorporated these ideals in his policies. But Trump’s critics ignore his stellar presidential achievements in their quest to block his return.
On the other hand, many express fatigue from his combative personality and attendant disorder. How does civility supersede his successful presidential record largely predicated on that style? A milquetoast president likely would not have accomplished what Trump did. Trump’s Republican opponents fear he would lose in 2024 and bring down other Republicans in the process. Thus, they call for new candidates. At the same time, Democrats think Trump could win. So, he gets blasted from both sides.
Is the “election denier” label scaring people off?
Some Republicans think support for Trump will brand them a dreaded 2020 “election denier” in a guilt-by-association connection, given Trump’s persistent claim that election was illegitimate. The moniker is becoming a scarlet letter for candidates. Such are the politics of intimidation fostered by Democrats, government and media today – and the diffidence of Republicans.
Cutting through the anti-Trump hype
What is the true electoral appetite for Trump’s recently announced 2024 run? The 2016 novelty has diminished. Trump fatigue is a factor. His age is a minus. But his conservatism remains, underscored by his presidential successes that distinguish him from any opponent. That record should override his negatives for principled Republicans, and even some Democrats. And, it highlights the outrageous policies of the Biden administration as to accentuate Democratic vulnerability. Contrary to Republican media hype, the 2022 midterm disappointments were not the Trump referendum many party powers-that-be claim.
Deep bench for the GOP
The GOP anti-Trump faction believes there are younger more palatable presidential candidates lacking Trump’s baggage that they believe could doom him in the 2024 election. Alternatives include conservatives Florida Governor Ron DeSantis, notably, as well as former Trump Secretary of State, Mike Pompeo, and Arkansas Senator Tom Cotton. They are great candidates, but Republicans should save one of them for two terms following another Trump stint. That would make potentially three successive terms, or more, to restore and entrench the conservative agenda.
Unfortunately, a constant Republican anti-Trump drumbeat for two more years could erode his support regardless of the merits and doom his candidacy. 11/29/22
THE COMPREHENSIVE CONSERVATIVE CELEBRATES 10 YEARS OF TRUTH TELLING. It has been a full decade of unvarnished conservative truth from yours truly bucking the tide amid mass media lies, propaganda and censorship, institutional wokeness and corruption, government tyranny, and cultural decay - all in the face of public gullibility, apathy and ignorance.
Throughout, I present an antidote of unspeakable political realities and traditional aesthetics, as well as well-informed commentary on finance and the economy grounded in 40 years of Wall Street experience. Check out my writings at https://www.williamjdodwell.com/archives
(If a link fails to deliver a selected title, click again. The digital path sometimes needs prompting.)
And while you’re at it, stop by Bill’s Music Lounge and relax to my piano renditions of jazz and popular classics at https://www.williamjdodwell.com/my-piano-recordings-bills-music-lounge 11/28/22
By William J. Dodwell November 7, 2022
With so many major races well within the margin of error in the latest polls, corrupt Democrat operatives are undoubtedly ready to spring into action tomorrow. The fraudulent November 2020 presidential election set the template and a firm precedent for ongoing venality. Will the Democrat Party succeed again?
The following close races are of particular interest as they involve especially dangerous radical Democrats.
- Kathy Hochul (D) vs. Lee Zeldin (R) for NY Governor
- John Fetterman (D) vs. Mehmet Oz (R) for PA U.S. Senate
- Mark Kelly (D) vs. Blake Masters (R) for AZ U.S. Senate
- Rafael Warner (D) vs. Herschel Walker (R) for GA U.S. Senate
- Mandela Barnes (D) vs. Ron Johnson (R) for WI U.S. Senate
- Gretchen Whitmer (D) vs. Tudor Dixon (R) for MI Governor
Despite repeated media reports, including from conservative outlets, outcome-changing irregularities in the 2020 election were never seriously reviewed for adjudication, notwithstanding copious evidence that compels judicial intervention. No judge has had the courage to pursue it out of fear for his reputation, his safety and even his life. Very few naysayers speak out because they fear reprisals and media vilification that would destroy their careers. Questioning that election continues to be verboten in all quarters. Kari Lake, Republican candidate for Governor of Arizona, is a stark exception. I love that gal!
There were other suspicious election results since November 2020. Consider the two runoff Senate races in Georgia in January 2021. In both cases, the advantage suddenly dropped to within 1% after long sizable Republican leads. The result produced two leftist senators in Rafael Warnock and Jon Ossoff.
Last year, Republican Jack Ciattarelli led New Jersey Governor Phil Murphy until the very end when probable ballot stuffing in heavily Democrat Newark in the dead of night protected the incumbent’s reelection.
Some state courts and legislatures have promulgated changes to preclude certain election violations. But will they be enforced? Plenty of latitude still exists with respect to the dating of ballots and signature verification. One jurisdiction in Pennsylvania announced that it will not comply with a recent court ruling about ballot dating. In 2020, existing laws sometimes were ignored. For example, in Pennsylvania and elsewhere the executive branch usurped the role of the legislature to change statutes. And who can forget the video of thugs blocking entrance to poll inspectors?
I offer this preemptive alert as a warning that, in the aftermath of November 2020, election integrity cannot necessarily be expected anymore. The determination of Democrats to cheat and the acquiescence of Republicans invite its demise. Where margins are razor thin, do not be surprised if strange things happen to the detriment of Republicans. This reality is a true threat to democracy.
©2022 William J. Dodwell