Tuesday, May 3, 2016

Tuesday, May 3, Night Wall Street Roundup: Wall St. Loses Ground On Growth Fears, Oil Slide

By Caroline Valetkevitch
May 3, 2016

U.S. stocks fell on Tuesday after weak economic data in China and Europe reignited worries about global growth, while oil prices dropped for a second day, dragging down energy shares.

Bucking the day's trend, Apple (AAPL.O) rose 1.6 percent to $95.18, breaking an eight-session streak of losses.

Activity in China's factories shrank for the 14th straight month in April as demand stagnated, a private survey showed. Britain's manufacturing output also unexpectedly shrank last month to its lowest level in three years.

U.S. oil prices CLc1 settled down 2.5 percent as rising output from the Middle East renewed concerns about global oversupply. The S&P energy index .SPNY, down 2.2 percent, led declines in the benchmark index.

Still, the recent recovery in oil prices, along with a softer dollar, have helped the S&P 500 rebound from a steep selloff earlier this year. The benchmark index is now up about 1 percent for the year so far.

"We had a nice rally yesterday, and in essence we're peeling that back today. The market is stuck in a trading range that is at the intersection of full valuations in U.S. equities and news that has not been necessarily overwhelming positive," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.

Shares of U.S. automakers were mostly lower as stronger-than-expected sales for April were not enough to offset worries that the industry's recovery is running out of steam. Shares of Ford (F.N) fell 1.4 percent to $13.43.

The Dow Jones industrial average .DJI closed down 140.25 points, or 0.78 percent, to 17,750.91, the S&P 500 .SPX lost 18.06 points, or 0.87 percent, to 2,063.37 and the Nasdaq Composite .IXIC dropped 54.37 points, or 1.13 percent, to 4,763.22.

The biggest economic release on the agenda this week is monthly U.S. payrolls, due on Friday. Last week, U.S. data showed tepid growth in first-quarter gross domestic product and a softening in the Fed's preferred measure of inflation.

Besides Apple, some healthcare companies were a bright spot, with Pfizer (PFE.N) up 2.7 percent at $33.70 after reporting a rise in quarterly revenue and raising its forecasts for the year.

Shares of drugmaker Mallinckrodt Plc (MNK.N) were up 6.8 percent at $64.84 following its results, while Mylan (MYL.O) was up 2.3 percent at $43.69, also after results.

About 7.8 billion shares changed hands on U.S. exchanges, compared with the 7.1 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Declining issues outnumbered advancing ones on the NYSE by 2,286 to 741, for a 3.09-to-1 ratio on the downside; on the Nasdaq, 2,083 issues fell and 738 advanced for a 2.82-to-1 ratio favoring decliners.

The S&P 500 posted 13 new 52-week highs and 3 new lows; the Nasdaq recorded 30 new highs and 47 new lows.

Article Link to Reuters:

Oil down second straight day; rising output reignites glut worry

By Barani Krishnan
May 3, 2016

Oil prices fell for a second day on Tuesday, retreating further from the year's highs hit last week, as rising output renewed worries about the global glut of crude, the U.S. dollar rebounded and equity markets weakened.

Output from the biggest oil producers in the Middle East jumped last month or could surge in the near term, data showed this week, ahead of a U.S. government report on Wednesday likely to cite record high crude stockpiles.

Brent crude futures LCOc1 settled down 86 cents, or 1.9 percent, at $44.97 a barrel.

U.S. crude's West Texas Intermediate (WTI) futures CLc1 fell $1.13, or 2.5 percent, to $43.65.

The two crude benchmarks gave back some losses in post-settlement trade after industry group American Petroleum Institute (API) reported a smaller U.S. crude stockpile build of 1.3 million barrels last week, compared with analysts' forecasts of a 1.7 million-barrel rise. [API/S] [EIA/S]

The U.S. government's Energy Information Administration (EIA) will issue official inventory data on Wednesday.

Brent and WTI both lost about 3 percent each in Monday's trade as production from the Organization of the Petroleum Exporting Countries neared all-time peaks and record speculative buying in global benchmark Brent sparked profit-taking on last month's over 21 percent rally to 2016 highs at $48.50.

April's oil rally had also narrowed the discount, or "contango," in WTI's front-month versus second-month CLc1-CLc2 to October lows, before the gap widened again on Tuesday.

"There are enough supply stories out there to slow or temper any gains," Energy Aspects analyst Richard Mallinson said.

Iraq said this week its oil shipments from southern fields averaged 3.4 million barrels per day (bpd) in April, up from 3.3 million bpd in March.

Production from top exporter Saudi Arabia could soon return to a near-record level of 10.5 million bpd, sources said.

Iran has nearly doubled exports to almost 2 million bpd since the start of the year.

In Tuesday's session, the dollar index .DXY rose for the first time since April 22, making dollar-denominated oil less attractive to holders of the euro and other currencies.

Global equities fell, stoked by dismal data on Chinese factory activity, British manufacturing and euro zone growth. [MKTS/GLOB]

In crude volumes, the 606 million barrels transacted by WTI, as per Reuters data, was barely changed from last week's levels, although Brent's was lower. "It's a sign there are enough people who want a correction in this overbought market," said Phil Flynn, analyst at the Price Futures Group in Chicago.

Technical pressure is also weighing on crude after its retreat from recent highs. Fawad Razaqzada, analyst at London's City Index, says Brent's support could erode to $44.50, then $42.50 and finally $41 before what could be "the end of the current bullish trend".

Article Link to Reuters:

As Trump draws closer to Republican victory, Cruz boils over

By Emily Flitter
May 3, 2016

With Donald Trump emerging as the favorite to win Indiana's primary on Tuesday and cement his grip on the Republican U.S. presidential nomination, his main rival Ted Cruz lashed out in unusually harsh terms, slamming the billionaire as a "pathological liar" and "amoral."

Cruz has been counting on a win in Tuesday's primary to slow the New York businessman's progress toward the nomination.

But polls in recent days have shown Trump opening up a substantial lead in the Midwestern state over the U.S. senator from Texas.

Campaigning in Evansville, Indiana, Cruz sounded deeply frustrated by the bombastic real estate mogul, who has ripped conservative Cruz at every turn.

"The man cannot tell the truth but he combines it with being a narcissist," Cruz said of Trump, "a narcissist at a level I don't think this country has ever seen."

Cruz also termed Trump a "serial philanderer" -- likely as part of his strategy to try to siphon the support of evangelical voters from Trump.

Republican voters in Indiana could give Trump an almost unstoppable advantage in his turbulent journey toward the party's presidential nomination. He holds a double-digit polling lead in the state.

Trump, who frequently refers to Cruz as "Lyin' Ted," quickly responded to his rival's attack.

"Over the last week, I have watched Lyin’ Ted become more and more unhinged as he is unable to react under the pressure and stress of losing, in all cases by landslides, the last six primary elections --- in fact, coming in last place in all but one of them," he said in a statement.

Trump has drawn both passionate support and vitriolic condemnation with his stands on immigration and national security - including a call to build a wall along the Mexican border that he says Mexico would pay for and a bid to temporarily ban Muslims from entering the United States.

Fresh off a sweep of five Northeastern states last week, a Trump win on Tuesday could put him within reach of the 1,237 delegates required to lock up the Republican nomination before the party's convention in July.

"If we win Indiana, it's over," he told a cheering crowd in Terre Haute, Indiana, on the eve of the vote.

Cruz's fading prospects prompted more soul-searching among Republican operatives and voters alike.

Mark Salter, a former top aide to Senator John McCain, the 2008 Republican presidential nominee, tweeted Tuesday that he could not support Trump in the general election and would instead back Hillary Clinton, the likely Democratic nominee.

Contacted by Reuters, Salter elaborated: "She is fit for office. He isn't."

Salter also called Clinton "the more conservative choice."

Goldie Hicks, 77, of Brazil, Indiana, cast a vote for Cruz and said she wasn't sure if she could support Trump in November. "He's just too loud, too boisterous," Hicks said. Nor could she support Clinton, she said.

Cruz vowed on Monday to "compete to the end" but a loss in Indiana would be particularly crushing for the senator, who has argued that his brand of religious conservatism is a natural draw for heartland Republicans.

Cruz's fury on Tuesday was set off by Trump linking the senator's father to John F. Kennedy's assassin.

The Texan pulled no punches. "I'm going to tell you what I really think of Donald Trump.

This man is a pathological liar. He doesn't know the difference

between truth and lies," he told reporters.

"He lies practically every word that comes out of his mouth.

And...his response is to accuse everybody else of lying."

Too Late?

For Cruz, Tuesday's critique of Trump was his fiercest yet. But it may come far too late. Earlier in the campaign, he refused to bash Trump over such proposals such as Trump's call for a ban on Muslim immigration.

In December, Cruz vowed that he "won't get engaged in personal insults and attacks" with Trump and warned that voters are turned off by "a bunch of politicians bickering like school children."

Trump now has 996 delegates, compared with 565 for Cruz and 153 for Ohio Governor John Kasich, according to The Associated Press. Another 57 delegates are up for grabs in Indiana.

Top Trump aide Corey Lewandowski told CNN on Tuesday the campaign expected to win more than required number of delegates - 1,300 to 1,400.

Julie Blackwell Chase, a clerk treasurer in the town of Bedford in southern Indiana, said she voted early for Trump in part because she appreciated his willingness to break with conventional politics. "We need new blood," she said.

On the Democratic side, front-runner Clinton holds a lead of more than 6 percentage points in Indiana over rival Bernie Sanders, according to an average of recent polls compiled by RealClearPolitics.

Despite Clinton's formidable delegate lead, the U.S. senator from Vermont campaigned heavily in Indiana on his message against income inequality and Wall Street excesses.

Jeremy Williamson weathered cold rain in Indianapolis to vote for Sanders, who he thinks should stay in the race to push Clinton to be more progressive. "I want to see the political revolution that everybody's promising," he said.

Clinton has already moved on to West Virginia, which holds its primary next week. On Tuesday, she tried to reassure coal workers in that state that her administration would work on their behalf as their industry faces an increasing threat from other sources of energy such as natural gas.

Article Link to Reuters:

U.K. Shows Where Anti-Semitism Leads

By Jonathan S. Tobin
May 3, 2016

We didn’t have to wait for the results of the independent inquiry into charges of anti-Semitism promised by the head of Britain’s Labour Party to see the scale of the problem. On Monday, the Telegraph reported that what it describes as the party’s “compliance unit” had already been overwhelmed by the problem of dealing with charges of anti-Semitism because it lacked the resources to look into so many cases. Nevertheless, the paper reported that Labour had already suspended 50 party members for anti-Semitism and as many as 20 in the last two weeks. But the problem isn’t going to be solved by a bigger inquiry or the sort of meaningless mea culpas that we’ve heard from some Labour figures.

The answer to what lies behind the string of disgusting comments that Labour is trying to rationalize and/or punish is the straight line that runs from the anti-Zionist agitation that is mainstream opinion among European and British left-wing elites to anti-Semitism. The same can be said of similar efforts to demonize and isolate Israel in the United States. What starts with agitation on college campuses will, if left unchecked, ultimately lead to politicians engaging in anti-Semitic invective.

As Tom Wilson wrote here yesterday in a cogent summary of the events of the past week, part of the problem is Labour’s growing dependence on radicalized Muslim communities as key elements of its base. But the willingness to pander to groups that retain anti-Jewish attitudes brought with them from the Middle East only provides part of the explanation. The odd alliance between leftists and Islamists is rooted in the way many intellectuals link imperialism, colonialism (the original sins of modern Europe in the eyes of the elite), and Zionism. That fallacious analogy in which the national liberation movement of the Jewish people is damned as an offshoot of Western colonialism has created a slippery slope on which the left has found itself scrambling to avoid being seen as encouraging hate while embracing positions that lead inevitably to prejudice.

Nothing could have illustrated this more plainly than what happened the day before the news of the Labour suspensions broke. Though Corbyn denounced anti-Semitism in a May Day speech on Monday, on Sunday Labour’s spokesman insisted that the party head would not disavow his contacts with both the Hamas and Hezbollah terror groups. The statement represented Corbyn’s connection to anti-Israel terrorists as merely meeting with people that he disagrees in the course of his advocacy for Palestinian rights; the truth is that he has done a lot more than that. Prior to being Labour’s leader he had embraced Hamas and encouraged dialogue with the group that runs Gaza as a terrorist state. He has also spoken of the equally radical and violent Hezbollah group as his “friends.”

To be fair to Corbyn, in this respect, he is hardly alone on the left. The willingness to treat the Jewish state’s terrorist foes as freedom fighters while demonizing Israelis is merely the logical conclusion for those who regard Israel’s creation as illegitimate and who oppose its right of self-defense.

Is it possible to hold such views while still treating Jews with respect and condemning religious prejudice? That’s what many anti-Israel activists claim, but they are all either deceiving themselves or lying.

Let’s be crystal clear about this. Those who seek to deny to the Jewish people what they would not think of refusing any other people on earth — the right to a state and to live in peace and security on at least a part of their ancient homeland — is an act of bias. The term for acts of bias against Jews is anti-Semitism.

There is simply no analogy to the anti-Zionist insistence that Jews have no rights to any part of the land of Israel or the territory of the former British Mandate for Palestine and any other territorial controversies elsewhere on the globe. Not everyone supports the rights of Catalans, Basques, or Kurds to their own separate nations. But no one seeks to force them out of their homes or considers their national movements inherently illegitimate. Only Zionism is treated in this manner. Only the movement to give Jews the same rights accorded other peoples is passionately opposed around the globe in this way.

The fervor of the anti-Zionists always winds up in anti-Semitic slanders because the source of the passion that drives this effort stems from traditional hatred of Jews. The problem isn’t just that a lot of British left-wing politicians have loose tongues and no self-control when it comes to venting on social media. Nor is it a matter of Jews misinterpreting criticism of Israel’s government as anti-Semitism, as many on the left disingenuously claim. If you think Jews are uniquely unworthy of the same rights as others you are not only practicing a form of prejudice; you are inevitably going to wind up saying vile things that demonstrates this bias.

It is to be hoped that the spectacle of Labour’s anti-Semitism problem will further discredit Corbyn and cause both his party members and the rest of the British people to draw the right conclusions from his faction’s flirtation with anti-Zionism. We should encourage such a development both in Britain and elsewhere in Europe where such attitudes have also worked their way back into the mainstream seven decades after the Holocaust. But it would be foolish to think that the widespread opposition to Israel’s right to exist in Europe is not a function of the legacy of centuries of anti-Semitic hate that festered on the continent.

All of this should give pause to the growing numbers of Americans who are either supporting anti-Zionism in academia or treating it as a legitimate expression of opinion rather than hate. What we learned in Britain in the last week is that you can’t create a firewall against religious hatred while simultaneously nurturing a movement that is rooted in bias against Jews. If you tolerate or rationalize groups that single out Israel and Jewish rights for opposition — whether it is called BDS or some other euphemism for Jew-hatred — you are inevitably going to wind up excusing anti-Semitic hate.

Article Link to Commentary:

Projecting the May 3, 2016 Indiana Presidential Primaries

Republican Party

1. Donald Trump -- 44%; +/- 3%

2. Ted Cruz -- 36%; +/- 4.5% 

3. John Kasich -- 16%; +/- 3%

Democratic Party

1. Hillary Clinton -- 52%; +/- 3%

2. Bernie Sanders -- 48%; +/- 2.75%

A solid 5-8% gain on AUMN in 30 minutes, dump the stock @ $.57; +/- .0125

I believe that Golden Minerals (Stock Symbol #AUMN) has likely bottomed out for the day, and is an Intraday Buy @ $.515; +/- .02

Politics Move Left, Americans Move Right

By Joel Kotkin
Real Clear Politics
May 3, 2016

In an election year in which the top likely candidates come from New York, big cities arguably dominate American politics more than at any time since New Deal. The dynamics of urban politics, which are characterized by high levels of inequality and racial tensions—may be pushing Democrats ever further to the left and Republicans toward the inchoate resentment of Donald Trump.

Yet if politics are now being dominated by big cities along the coasts, the most recent U.S. Census Bureau data suggests that when it comes to their own lives, Americans are moving increasingly elsewhere, largely to generally Republican-leaning suburbs and Sunbelt states. In other words, politics and power are headed one way, demographics the other.

Perhaps no American president has been less sympathetic to suburbs than Barack Obama. Shaun Donovan, Obama’s first secretary of Housing and Urban Development, proclaimed the suburbs’ were “over” as people were “voting with their feet” and moving to dense, transit-oriented urban centers. More recently, Donovan’s successor, Julian Castro, has targeted suburbs by proposing to force them to densify and take more poor people into their communities. Other Democrats, notably California’s Jerry Brown, have sought to use concerns over climate change to make future suburban development all but impossible.

This divergence between politics and how people choose to live has never been greater. As economist Jed Kolko has observed, the perceived “historic” shift back to the inner city has turned out to be a relatively brief phenomena. Since 2012, suburbs and exurbs, which have seven times as many people, again are growing faster than core cities.

This is not likely to be a short-lived phenomena. Generally speaking, Kolko notes that an aging population tends to make the country more suburban. The overwhelming trend among seniors is not to move “back to the city” but to stay in or move out to suburban or exurban areas. Between 2000 and 2012, notes demographer Wendell Cox, 99.6 percent of the senior population increase in major metropolitan areas was in the suburbs, a gain of 4.3 million compared to the gain of 17,000 in the urban core.

There is also the well-demonstrated tendency for people entering their 30s, prime child-bearing age, to move to suburban locations for safety, space and better schools. Here’s the basic score: Core counties last year lost a net 185,000 domestic migrants, while the suburban counties gained 187,000. Rather than a reversal of suburbanizing trends, we see something of an acceleration.

Primarily Republican-leaning areas may be losing their political power for now, but their demographic growth is relentless. Like the suburbs, the sprawling Sunbelt metros were widely predicted by urban pundits to be heading toward an inevitable extinction.

Yet the 2015 census data shows something quite different: Virtually every fast-growing metro region in the country is located far from the Eastern Seaboard, and increasingly outside of California. Houston, Dallas-Fort Worth, Atlanta and Phoenix each gained more people last year than either New York or Los Angeles, which are three to four times larger.

Among America’s 53 largest metropolitan areas, nine of the 10 fastest-growing ones are in the Sunbelt: Austin, Orlando, Raleigh, Houston, Las Vegas, San Antonio, Dallas-Fort Worth, Nashville and Tampa-St. Petersburg. The only outlier is Denver, which has become a destination for people and companies fleeing higher priced areas, particularly the West Coast.

Perhaps even more revealing are the trends in domestic migration. The leaders in total domestic net migration parallel almost precisely those that have experienced the strongest total population growth, led by Houston, Dallas-Fort Worth and Phoenix; together these metro areas added 150,000 net domestic residents. In percentage terms the big winners are Austin, Tampa-St. Petersburg, Raleigh, and Orlando.

So which states are losing out among domestic migrants? The biggest loser is the home of our likely next president. New York experienced a net out-migration of 160,000 between 2014 and 2015. Over the past five years its metropolitan area has lost 701,000 net domestic migrants after suffering a population loss of nearly 2 million in the first decade of the new millennium. Chicago and Los Angeles also have experienced net out-migration as have some cities—such as San Jose and Washington, D.C.—even as they experienced impressive economic booms.

These latest numbers confirm the likelihood that highly suburbanized areas, particularly in the Sunbelt, will continue to represent our demographic future. For all the hype and hysteria surrounding the urban revival, dense cities are not irresistible lures to most people. For the most part, they are experiencing sub-normal, and even declining, growth. The most urban of our urban cores, New York City, illustrates this slackening of population. For one year, the Big Apple grew at 1.2 percent (2011), above the national average of 0.7 percent. Yet, its growth dropped in 2015 to 0.6 percent, well below the national average. Brooklyn’s population growth declined in half from 2011 to 2015, while Manhattan’s declined by two-thirds. The only borough to show strong growth has been its poorest, the Bronx.

None of this suggests that dense core cities are irrelevant to the future. As economist Kolko suggests, inner city gentrification, particularly close to the urban core, has accompanied strong income growth and remains attractive to relatively small parts of the population: the highly educated, the affluent childless, single as well as the uber-rich. These places loom large also because that’s where the media is increasingly concentrated. And with a big city, East Coast-oriented person in the Oval Office next year, they could find themselves more influential, at least in the short run, than at any time in recent history.

This divergence between power and population sets the stage for future political conflicts, particularly given likely Democratic Party electoral gains this year. Attempts to crack down on suburban housing and resource industries, notably fossil fuels, seems likely to hit hardest many places that are growing quickly, and which generally lean to the GOP.

It could well be, as some progressives have forecast for over a decade, that the movement of New Yorkers and Californians, combined with the growth of minorities, in places like Texas and Arizona will paint these places Democratic blue. This seems reasonable, but what happens when Washington adopts policies that clearly hurt the new suburban homeowners, and the industries that have sparked Sunbelt growth?

The new Texans and Arizonans may well be more socially liberal than the current denizens, but one has to wonder if they would like to see the prospect of better professional opportunities and affordable homes squelched by Washington’s urban-centric elite.

This could turn out to be a bad election for those middle American aspirations, but over time progressive triumphalism could engender a grassroots rebellion capable of overturning the 2016 election results in shockingly fast fashion.

Article Link to the Real Clear Politics:

How Bernie Changed Hillary

Sanders has left a lasting imprint on Clinton’s candidacy, even if few in her camp are willing to admit it.

By Annie Karni
May 3, 2016

No candidate ever wants a tough primary challenge – and Hillary Clinton has found the mass appeal of a self-described socialist particularly irksome. But as she shifts her gaze toward the general election and Donald Trump, Clinton may have actually learned some lessons from Bernie Sanders.

On the eve of the Indiana primary, Clinton was touring Appalachia, making an appeal to voters who have been energized by the anti-trade message of both Sanders and Trump. Sanders’ focus on deep economic discontent, inequality and a political system dominated by big money helped inform and polish her response. "Talk about a ripple effect. It's just devastating communities," Clinton told steel workers at an Italian restaurant in Ashland, Kentucky.

“You can see in her rhetoric and positioning that Hillary Clinton has heard this message loud and clear,” said political strategist David Axelrod, a former adviser to President Obama. “It’s reflected in her messaging and very specific policies. The challenge is to persuade the skeptical that this will be a genuine focus in the White House and not just a passing political fancy.”

That challenge is most obvious on some of Sanders’ signature issues. On the minimum wage, for instance, Clinton now emphasizes her support for the nationwide “fight for $15,” even though she supports raising the federal minimum wage to $12. On trade, Clinton has struggled to get past the impression that she flipped positions from her previous support for the Trans-Pacific Partnership -- her explanation that she came out against the trade deal citing specific objections to the final copy has been difficult for some voters to swallow after she had once called it the “gold standard” of trade deals.

Clinton’s operatives deny that she had anything to learn from Sanders and point to her consistency on the issues -- she still says she supports some trade deals; she wants a $15 minimum wage decided on a state-by-state basis; and in her kick-off speech on Roosevelt Island in April of 2015, she raised the specter of income inequality in a laundry list of issues her campaign would seek to address.

“While many of you are working multiple jobs to make ends meet,” she told the crowd on that warm spring day last year when she launched her campaign, “you see the top 25 hedge fund managers making more than all of America’s kindergarten teachers combined. And, often paying a lower tax rate.”

She said she wanted to be the resident “for the successful and the struggling.”

But since then, as Sanders’ strident criticism of Wall Street has won him a devoted progressive following, her rhetoric toward Wall Street -- home to many of her top donors -- has become increasingly hotter. It’s moved up to become a more prominent component of her stump speech. And she has critiqued corporations by vowing to go after price-gouging pharmaceutical companies.

“I think she learned there’s anger on the left,” said former Pennsylvania Gov. Ed Rendell, a Clinton supporter. “Had she run unopposed, or with only Martin O’Malley, she never would have learned that.”

Rendell said she has addressed that anger -- “partially” -- by emphasizing pieces of her own record that fits the narrative that animates Sanders’ supporters. That includes highlighting her support of Dodd-Frank banking reforms, and emphasizing that her Wall Street reform prescriptions are “tougher” than Sanders’ plans to break up the big banks.

“The same is true on income inequality,” Rendell added. “She obviously cared about it, but I’m not sure it would have been as much a part of her basic message as it is because of Bernie’s challenge -- and I think she’s got some good things to say about income inequality.”

At the same time, she has advocated for a mainstream Democratic position of raising taxes on the wealthy but not the middle-class, and does not advocate for expanding Social Security for all.

“Did she know in advance that wages had been stagnant and she’d have to come up with something that was going to do that? Sure,” said said Lee Miringoff, director of the Marist Institute for Public Opinion. “It probably moved its way up into higher in her stump speech because of what Sanders was saying.”

Since that kick-off speech Clinton has also put a new focus on guns -- which weren’t even mentioned during her launch – one of the few issues where she can maneuver to Sanders’ left. In time, she embraced gun policy as a moral center of her campaign.

Clinton's operatives insist they always knew it would be a battle and had planned to fight for every vote. But Sanders’ challenge – still ongoing, with the Vermont senator insisting he’ll take the fight to the Democratic convention in July -- lit a fire under Clinton, one that may have gotten her in fighting shape for the nasty battle expected this fall.

In Nevada, for instance, fresh off of her devastating New Hampshire loss, Clinton hustled the back rooms of casinos and met with cafeteria employees and blackjack dealers working the night shift, making a trip to their break room after midnight. She made multiple appearances on picket lines with members of the powerful Culinary Union, who were striking over healthcare costs.

Two months later, she kept a similar pace. In her home state of New York -- which she wanted and needed to win big to kill Sanders’ growing momentum -- Clinton embraced her campaign’s idea of contrasting small events with Sanders’ big rallies. The former senator, now more of a visiting state dignitary, eagerly embraced the return to shoe leather campaigning, showing up at restaurants, appearing in the subway, at block parties, and even a housing project.

All that practice at retail politics helped a candidate who admits she's no natural at campaigning. “She came out of the box rusty,” admitted Mo Elleithee, who served as Clinton’s traveling press secretary in 2008. “I think the come-out-of-nowhere strength of Sanders’ campaign forced them to reorient, both in terms of infrastructure and message, to make it crisper, and speak to some of the anxieties he was speaking to. Had she walked into this nomination, I'd be far more worried about the general.”

Clinton also got stronger on the issue of race -- another area that quickly emerged as a strong contrast with Sanders, who failed to address the issue outside of the economic inequality box. Clinton delivered multiple, wide-ranging speeches about the systematic racism at play in the country, and criminal justice reform, a contrast to how Sanders talked about the issue through the lens of income inequality. Clinton's campaign has distanced itself from Bill Clinton's 1994 crime bill, leaving him to defend his own record there, and continues to speak to issues that matter to African-Americans: expanding voting rights, gun safety and criminal justice reform.

The race issue that has become part of the core of Clinton's campaign wasn't even mentioned in her Roosevelt Island kick-off speech. Now, she figures to be stronger in November among African-American voters than she might have otherwise been.

At her campaign kick-off, Clinton did make a coy reference to being “the youngest candidate in the race.” On that front, the 74-year-old Vermont senator presented Clinton with a bow-tied present -- he took the issue of age off the table. “There would have been a different narrative to the stamina stuff, questions about does she have what it takes,” said Miringoff. “He kept her middle-aged.”

Clinton operatives for their part deny that Sanders has taught them anything at all. “Everybody is forgetting where we started the campaign,” said senior strategist Joel Benenson. “The reason she has been winning consistently and amassed so many more votes is she didn’t just start talking about these things, she built her plans around this. The [breaking down] barriers message she has been delivering is a much broader message than anyone in this race has talked about.”

Some of Clinton’s top donors go one step further: They insist Sanders' presence in the race has been “useless” and negative, providing “she’s not qualified” soundbites to Trump, who has admitted he has clipped-and-saved them for future ads, and depleting the cash reserves she will need to compete in a general election. Others deny that she has been pushed on any issues, and note that any distinctions between the candidates are a matter of nuance.

If nothing else, Sanders’ appeal among the under-30 set revealed to Clinton's Brooklyn brain trust that they have a major problem with millennial voters. Campaign officials concede they have not made inroads with young voters -- even young women voters -- despite outreach like the cameo on the Comedy Central series “Broad City” and attempts to speak to issues like sexual assault on college campuses and to refinance student loans. The campaign has yet to figure out how to address the issue, a voting bloc they do not view as critical to winning the White House but one which attracts outsized attention and could provide the difference in a close election.

"They may not support me now, but I support them," Clinton acknowledged of young voters in a debate last February.

As for all the young people flocking to Sanders rallies -- 1.1 million people have physically attended a Sanders event since he launched his campaign last year -- longtime Clinton allies conceded it was instructive.

“I knew that both the Democratic Party and the country were getting more liberal," said Clinton confidante James Carville. "It probably taught me it was even more than I thought.”

Article Link to Real Clear Politics:

Europe's Refugee Deal With Turkey Is Working, Sort Of

By Editorial Board
The Bloomberg View
May 3, 2016

The European Union’s deal with Turkey to control the flow of refugees to Europe has been a success -- if success is defined narrowly. A lasting solution to this crisis, however, will require more than simply closing off one way onto the continent.

The deal, under which Turkey accepts refugees from Greece in exchange for 6 billion euros ($6.9 billion) and the right for its citizens to visa-free travel in Europe, is an almost (but not quite) unbearable compromise. Before the agreement, and before Macedonia closed its border with Greece, up to 10,000 asylum seekers a day crossed the Mediterranean to the Hellenic Republic. Hundreds died in the attempt.

Now as few as 50 people per day are arriving on the Greek islands. It’s undeniable that the agreement is saving lives. It may also allow Europe to keep open its internal borders, which brings huge economic benefits to the entire continent.

Meanwhile, refugees are finding other ways to get to Europe. Meanwhile, refugees are finding other ways to get to Europe. In April, some 500 people died when their boat capsized en route from Libya to Italy. To close this passage, the EU can't cut a deal with Libya like the one it made with Turkey, because Libya barely has a government. Instead it is negotiating with other countries whose citizens often arrive to Europe by way of Libya, such as Nigeria.

These are ad hoc solutions. Attempting to close off each emerging avenue of emigration is a hopeless undertaking. For both humanitarian and security reasons, the refugee crisis demands a more comprehensive response.

Last year, more than 1 million asylum seekers arrived in the EU. The core innovation of the Turkish deal -- the EU’s acceptance of one vetted refugee already in Turkey for each unvetted refugee Turkey accepts from Greece -- is limited to 72,000 people. Once refugees are no longer attempting the trip from Turkey, the "one-for-one" deal implies that there will also be no more resettlement.

Refugee resettlement is critical, because it provides a legal and safe way for those fleeing war to apply for asylum in the West. But any program has to be big enough to give refugees some reasonable hope of success. Last year, EU officials floated a proposal to resettle 200,000 refugees annually. That’s still not enough, but it’s better than 72,000.

Unfortunately, in too many countries in Europe, even one refugee is too many. Austria has toughened immigration rules to enable it turn away virtually all asylum seekers, for example, while the U.K.parliament has blocked a plan to accept 3,000 unaccompanied Syrian children.

Conflict in the Middle East has caused this crisis. Fear and lethargy in Europe have made it worse. Arriving at a comprehensive solution may be beyond Europe's leaders at the moment. Make no mistake, however: Responding to each emergency is necessary, but it is far from sufficient.

Article Link to the Bloomberg View:

A Vote to Stay in the EU Isn't a Vote for Europe

By Clive Crook
The Bloomberg View
May 3, 2016

The biggest misconception about next month's referendum on Britain's membership of the European Union is that it will put the issue to rest. That's unlikely. Whichever way the vote goes, Brexit isn't going away.

The referendum on Scottish independence is a good guide to what's coming. Scots in 2014 voted with their heads not their hearts to stay in the U.K. -- then at the following general election gave the Scottish National Party, dedicated to Scottish independence, a crushing victory north of the border. The thinking seemed to be: The safe choice is to stick with the U.K., but please understand we aren't happy and might change our minds at short notice.

The U.K.'s calculation on Europe is similar. Quitting the EU is a big economic risk, so prudence says stay. But British (that is English) resentment at rule from Brussels won't be assuaged by being offered the choice to go. Doing the prudent thing will only make Britain more resentful. The U.K. will be more euro-skeptic and the careers of anti-EU politicians such as Boris Johnson will be far from over.

The case for prudence is gaining strength thanks to reports from the Treasury and the Organization of Economic Cooperation and Development (a club of high-income countries). They predict long-term losses of around 5 percent of gross domestic product a year, equivalent to several thousand pounds per household. Other studies say much the same. A recent rejoinder from a group of euro-skeptic economists, arguing that Britain's' economy would get a boost from exit, doesn't carry the same weight.

Actually, that dissent makes some good points. It notes that neither of the two big official reports that warn against leaving consider the option of unilateral free trade, which would likely be the best-case scenario post-Brexit. Instead, they dwell on the costs and protracted delays involved in negotiating new preferential trade agreements with the EU and Britain's other trading partners.

On the other hand, neither the official reports nor the euro-skeptics' dissent consider the risk of outright retaliation by the EU, should Britain leave. (Tariffs are capped by the World Trade Organization, but there's plenty of scope for behind-the-border protectionism aimed at services, where the WTO's writ does not run.) That's the biggest risk: If it happened, the official worst-case estimates might be too small.

In any event, Brexit is fraught with risk, and voters are likely to make the safer choice. But because they'll do so reluctantly, Britain's EU partners should expect the U.K. to be an even bigger nuisance in future.

In the longer term, Britain retains its blocking power over treaty changes: It can't steer the broader project, but it can stop anybody else steering it. Other EU governments aren't interested in revising the treaties just now anyway, because the union is unpopular elsewhere too, which would make it hard to get the changes ratified by national parliaments. Still, a point will come when treaty changes are needed to fix what's broken in the EU economy. The reformers will have to deal with Britain.

In the meantime, the U.K. could be more deliberate about dragging its feet. It could follow the example of many other EU governments, which regard a commitment (such as a fiscal target) as binding only if they feel like being bound. Brits are a bit priggish about seeing promises to other governments as undertakings rather than aspirations.

Having refused to adopt the euro, the U.K. is already semi-detached from the EU's main economic project. It has opt-outs in other areas of policy too. This distance is going to widen under the pressure of heightened euro-skeptic sentiment following a vote to stay. Over time, as the euro area pursues closer integration in fiscal and financial policy, Britain will become even more of an anomaly -- and demands for Brexit won't subside.

Eventually, the EU might come to agree that Brexit makes sense. I've argued before that Britain's best bet in Europe is to be exasperating. Sure, it's been pretty exasperating already, but it can do better. Remember, the biggest risk in Brexit is that the EU will punish Britain for leaving. The answer is obvious. Vote to stay -- then bring the EU to the point where it will pay Britain to go.

Article Link to the Bloomberg View:

Ted Cruz Seeks Divine Intervention in Indiana

The Texas senator needs a win in Indiana to stay relevant in the 2016 race, so he has enlisted the help of the three G’s: God, Glenn, and Gohmert.

By Betsy Woodruff 
The Daily Beast
May 3, 2016

Hoosiers are Ted Cruz’s last hope.

The near-universal consensus is that without a victory in Indiana’s Republican primary on May 3, Cruz will have no credible way of arguing that he could still snag the nomination.

But if they give him a win, his campaign will live to fight on.

It’s his hour of greatest need.

So after Hail Mary veep picks and strange alliances, the Texan has turned in the home stretch to God, Glenn, and Gohmert.

Cruz is looking to re-bottle the Wisconsin and Iowa magic, filling the state with right-wing radio favorites and recruiting endorsements from dozens of pastors.

It’s a mix of strategies that’s brought him success in other Midwestern states. But in Indiana, the outlook is a bit bleaker -- and the Cruz Crew is living on a wing and a prayer.

On Friday, Cruz’s team announced that he’d been endorsed by more than 50 pastors and social conservative leaders.

He made a similar announcement regarding Wisconsin faith leaders shortly before that primary, and it foreshadowed a 13-point victory there. In Indiana, though, things are a little different -- in part because conservative voters there don’t seem quite as single-minded in their longing for an archetypal conservative as the Republican nominee.

In fact, at least one of the pastors Cruz’s campaign boasted about isn’t actually sure whether he’ll vote for Cruz or Trump.

Pastor Kent Harting, who leads the Ijamsville United Methodist Church in Ijamsville, In., is listed as one of the campaign’s 50+ endorsers. Reached by phone, though, Harting said he’s having second thoughts.

“I went and heard his daddy, and I was pretty impressed with his daddy,” Harting said, of Rafael Cruz -- the senator’s father and one of his top surrogates. “I wish his daddy was running but to tell you the truth, I haven’t gotten to pull yet tomorrow and I haven’t pulled the lever yet, so we’ll see what happens in the morning.”

“I like Mr. Trump, I like Mr. Cruz, and it’s a real hard decision to make sure which one I pull,” he added.

Harting said he wants a godly president, but he also wants someone who understands business.

“It’s a real hard decision, and one day I lean one way and one day I lean the other way,” he said.

Harting added that he signed a card saying he supported Cruz after hearing his father, Rafael Cruz, speak. But the staffer at the event who got his name seemed a bit confused, Harting continued, as the campaign announced that Harting was from “Jamesville UME” -- a church that does not exist.

But other pastors the campaign listed told The Daily Beast that their support for the Texan is enthusiastic -- some, in fact, are even fasting for his victory.

Jerel Clanney, who heads Victory Baptist Church in southwest Indiana, said he’s encouraged his congregation to fast before the election.

“I think that shows God there is a level of commitment on Christians’ part to not approach the election with an average mentality,” he said.

He added that he has fasted for several 24-hour periods over the past two months, praying for God’s will to be done. And he’s voting Cruz.

“Ted Cruz, to me, is the one that lines up most consistently with what the Scripture tells us to look for in a national leader,” he said.

“If we get somebody that believes according to the Scripture and stands for conservative values, all that other stuff will be taken care of,” he added.

The Indiana Pastors Alliance helped connect Rafael Cruz to churches around the state, according to their executive director Ron Johnson. Johnson said that though the group doesn’t endorse, it helped facilitate about ten speaking engagements for Cruz’s father. Those visits sometimes resulted in pastoral endorsements. Johnson has endorsed Cruz, and said he’s the only candidate who comes down on the right side of the same-sex marriage debate, the abortion debate, and the religious freedom question -- three issues that are “non-negotiables, at least for Bible-believing Christians.”

“Healthy marriages between a man and a woman which create children are the cornerstone of every society,” Johnson said, “and if a candidate can’t figure out that issue, we should seriously question whether they deserve our vote.”

Radio host Glenn Beck, a Mormon who campaigns for Cruz, has pushed hard for his listeners to go hungry for Ted on Tuesday.

“[B]ecause we are the only nation since ancient Israel to have actually made a covenant with Him, it must be broken, I believe by all of us,” he wrote on Facebook. “I realize many will mock this theory, but in a way that will prove my point. We have become such an unholy people that he wants to see each of us, each state to choose - who will you serve?”

Beck has travelled Indiana with Cruz, urging Hoosiers to support his candidacy. As has Rep. Louie Gohmert, a long-winded Texas congressman famous for once, while serving as a district judge, duct-taping a defendant’s head. For real.

Gohmert also regularly gives hour-long speeches on the House floor, and spoke for more time there than any of his colleagues in 2014, according to The Hill. And he has some interesting thoughts on trans people and bathrooms.

“[I]n the seventh grade if the law had been that all I had to do was say, ‘I’m a girl,’ and I got to go into the girls’ restroom, I don’t know if I could’ve withstood the temptation just to get educated back in those days,” he told Tony Perkins in audio that RightWingWatch aggregated.

Now, Gohmert has taken to the campaign trail to educate Hoosiers about Cruz. According to reports, he’s joked that Fox News is “the Trump super PAC,” and vented that “the most dishonest man in the race calls the most honest man ‘Lyin’.”

After stumping for Cruz in Iowa, Gohmert had little campaign-trail presence for the senator. But now that Indiana is looking like it could be Cruz’s waterloo, Gohmert is back in business.

Trump’s supporters seem skeptical. Cruz confronted a few of them who stood outside a restaurant where he had made a retail stop. They waved TRUMP signs and yelled, “Boo, Cruz,” and “Go back to Texas,” according to the Wall Street Journal. Cruz told one of the Trump supporters that their chosen candidate was “playing you for a chump.” Cruz also said he showed the protester more deference than Trump would have.

“You’ll find out tomorrow,” the man retorted. “Indiana don’t want you.”

Cable news networks played the conversation on loop as one more piece of evidence that the Texas Republican could have a bad time in Indiana come Tuesday. And the evidence isn’t just anecdotal; an NBC poll released on Sunday gave Trump a 15-point lead over Cruz. And the RealClearPolitics average gives him a 9.3-point lead.

Cruz seems aware that things aren’t great, and his decision to add former rival Carly Fiorina to the ticket telegraphed a touch of desperation. It’s clear that Cruz, Beck, and Gohmert are hoping for divine intervention. But the Texan has lasted longer than many expected, despite derision from powerful voices both outside his party and in. A win seems improbable but not completely outside the realm of possibility. And with an army of pastors, anything (maybe) is possible.

Article Link to the Daily Beast:

How the Kleptocrats’ $12 Trillion Heist Helps Keep Most of the World Impoverished

An investigative economist has crunched 45 years of official statistics to discover just how much kleptocrats have plundered from 150 mostly poor nations.

By David Cay Johnston
The Daily Beast
May 3, 2016

For the first time we have a reliable estimate of how much money thieving dictators and others have looted from 150 mostly poor nations and hidden offshore: $12.1 trillion.

That huge figure equals a nickel on each dollar of global wealth and yet it excludes the wealthiest regions of the planet: America, Canada, Europe, Japan, Australia, and New Zealand.

That so much money is missing from these poorer nations explains why vast numbers of people live in abject poverty even in countries where economic activity per capita is above the world average. In Equatorial Guinea, for example, the national economy’s output per person comes to 60 cents for each dollar Americans enjoy, measured using what economists call purchasing power equivalents, yet living standards remain abysmal.

The $12.1 trillion estimate—which amounts to two-thirds of America’s annual GDP being taken out of the economies of much poorer nations—is for flight wealth built up since 1970.

Add to that flight wealth from the world’s rich regions, much of it due to tax evasion and criminal activities like drug dealing, and the global figure for hidden offshore wealth totals as much as $36 trillion.

In 2014 the net worth of planet Earth was about $240 trillion, which means about 15 percent of global wealth is in hiding, significantly reducing the capital available to spur world economic growth.

That $12.1 trillion figure for money looted from poorer countries has been hiding in plain sight. It comes from numbers in the global economic data—derived by comparing statistics from the International Monetary Fund and the World Bank, supplemented by some figures from the United Nations and the U.S. Central Intelligence Agency—that do not match up, but which until now no one had bothered to analyze.

You might think that with their vast staffs of economists and analysts the IMF, the World Bank, and other institutions would have run the numbers long ago, but no.

Following the Money

Instead, one determined person combed 45 years of official statistics from around the world to calculate the flight wealth for nearly 200 countries that publish comparable economic data.

That’s Jim Henry, who was a rising corporate star until he gave it all up to document illicit flows of money and the damage they do to billions of people.

Henry has been the chief economist at McKinsey & Co., arguably the world’s most influential business consultancy, and worked directly under Jack Welch at General Electric. A Harvard-educated economist and lawyer, Henry calls himself an investigative economist. His approach is simple: “just look at the effing data and solve the puzzle” of mismatches between the various official sources.

From his home in Sag Harbor, near the tip of Long Island, Henry has painstakingly built massive spreadsheets to reveal the mismatches that indicate capital flight. He then fleshes out what the data show by interviewing bankers and bank regulators, government economists, law enforcement officials and even some of the retainers who help kleptocrats loot the countries they rule.

Henry, a consultant on the Panama Papers journalism project, has released some of his findings at a global Tax Justice Network meeting in London. He shared a fuller set of his data with me.

Henry has been ahead of the curve on these issues for decades. In 1976, the year he graduated from Harvard Law School, Henry wrote a cover story for The Washington Monthly urging elimination of the world’s most popular paper currency, the $100 bill. He argued that large paper bills helped drug dealers, tax evaders and other criminals while honest people use checks and other bank services.

His proposal was unacknowledged by Larry Summers, the former Treasury secretary, and Harvard economist Kenneth Rogoff, in their recent proposals to ban the large bills, known as Benjamins because they feature Benjamin Franklin.

This week the European Central Bank is expected to vote to eliminate its €500 note, which Henry recommended for years before others took up the cause. No American action is slated to ban Benjamins, more than two-thirds of which are held outside the U.S.

The Cost of the Crime

The 150 poorer nations all have weak tax systems, which means that tax evasion—the driving force for Americans and Europeans hiding wealth offshore—is a minor factor in the levels of flight wealth from those countries.

Collectively the 150 poorer countries whose economic data Henry scrutinized owe $8.1 trillion of foreign debt. Statistically, that means that all of the money these nations borrowed externally, much of it from the United States and Europe, has been sent offshore. In addition, corrupt rulers looted $4 trillion from the national treasuries they control.

Almost a third of the $12.1 trillion of poorer country flight wealth comes from Russia, China, Malaysia, Mexico and Venezuela. Those countries are all major oil exporters, except for China.

Were all of the flight capital returned and invested smartly it would reduce human misery by raising living standards, especially by reducing child mortality while increasing both health status and life expectancy.

Kleptocrats and their retainers are not the only sources of flight wealth. A small portion belongs to business people who keep some of their wealth offshore for fear it will be confiscated. The weaker the laws to protect property, the greater the share of honest wealth titled offshore.

There are only “inadequate protection of assets in these countries,” Henry said. Those who earned their wealth in business shield some of it from predatory rulers, which has the negative effect of reinforcing poverty.

While lawlessness enables kleptocrats, they put much of their ill-got money in Switzerland, the United States and British protectorates such as Bermuda and the Cayman Islands “where the rule of law is strong because you don’t want to get deposed and then show up to get your money and discover that it’s been stolen from you.”

Many kleptocrats use shell companies to store wealth in economically unproductive assets. They buy beachfront homes in Honolulu, Malibu and Miami; sprawling apartments with Central Park views in Manhattan and bay views in San Francisco; and mega-yachts tied up in Monaco and St Kitts.

Even though some of this flight wealth was stolen decades ago, only a small portion of it represents investments gains. That’s because kleptocrats value secrecy and security far more than market gains. When they want more they can just steal more.

Switzerland, Henry notes, has the highest cost banking services among major countries because many of its customers are indifferent to price. They are willing to pay to ensure their hidden fortunes will ensure a luxurious exile if they are deposed from power.

Flight wealth is mostly stashed with the world’s major banks in accounts paying little to no interest, Henry said. A growing share is also in huge storage vaults, known as freeports, where gold, art, jewelry and other physical wealth can be kept safe and out of sight.

The purchase of art by kleptocrats who store it in vaults has contributed to the rapid rise in art prices in recent decades, as well as to keeping many of the greatest creations of mankind unavailable for viewing.

Henry identifies numerous big international banks as favored choices of kleptocrats, a subject I’ll return to in future columns.

“We need fundamental reform of banking,” he says, “so the kleptocrats do not sleep well at night.”

Article Link to the Daily Beast:

Donald Trump, Postmodern Nihilist

The predictions about Trump have been so wrong because none of the normal rules apply to him.

By Victor Davis Hanson 
The National Review
May 3, 2016

Columnists assured us that Donald Trump’s campaign would implode after he cheaply besmirched war hero John McCain. They assured us again after he crudely dismissed Fox News’s star anchor and heartthrob, Megyn Kelly. And again after his schoolboy rumor-mongering about Senator Ted Cruz’s wife. And on and on.

Yet such nonstop insults and gaffes have had little effect on the Trump candidacy. Actually, they have had no effect at all. Zero. Zilch.

Political operatives insisted that Trump would fade, given that he had no real organization on the ground. My God, they said, he has no handlers, and not a position paper in sight. Where is his internal polling? Where are the senior Wise Men to advise him on the demographics of state primaries? Yet Trump garnered more free publicity, interviews, and attention from the liberal media than did any well-handled candidate, Democrat or Republican.

The commentators on the weekend talk shows employed adverbs like “finally” and “at last” to characterize each of the latest outrages likely to end Trump’s campaign. Trump broke his promise about releasing his income-tax returns (was he hiding a whittled-down 13 percent tax rate in Bernie Sanders fashion?). He fibs nonstop about opposing the Iraq war from the beginning. And he continuously exaggerates his net worth, as if the public were a lender that he was conning.

Each of those fudgings earned pronouncements from the experts about a “turning point” in his fate. How many times has someone on a Sunday-morning show pronounced, in somber tones, “Trump has gone too far this time” — without defining “too far”?

These periodic Trump obituaries were often instead followed by upticks in Trump’s popularity. A Trump orgasm is to have someone in a suit and makeup, or with a title before his name, pontificate that Trump should be and is through — a Trump pleasure surpassed only by a shouting young anti-Trump disrupter shown on the news with a placard, “Make America Mexico Again.”

Seasoned pollsters intoned that if only the rest of the Republican field would winnow itself out, thus allowing a direct head-to-head vote between Trump and one solid conservative, Trump would certainly lose. Yet the more candidates dropped out of the Republican primaries, the stronger Trump seemed to become.

Pollsters also insisted that Trump alone of the major Republican candidates — unlike Ted Cruz, John Kasich, or Marco Rubio — could not beat Hillary Clinton in the general election. But the more frequently Trump was written off as unviable, the more his polls climbed to near Clinton’s. Was he a Goldwater primary tsunami that would wash out in the general election, or a rare Reagan tidal wave that would bury his skeptics, both now and in November?

Clearly, elite journalists, political advisers, media anchors, and pollsters, for all their analyses, have no idea where, why, and how Trump garners support. He follows no campaign rules. He has no consistent political ideology. He ignores decorum. Scandals do not tar him. The media treat him like a cobra rising from a basket — terrified that if at any moment they stop their music, the smiling serpent might strike and bite them in the nose.

Tomorrow Trump could declare there to be 57 states, or address vets as Corpse-men or tell his legions to bring a gun to a knife fight — and none of his supporters would find him clueless, half-educated, or incendiary. If Trump brought one of his wheeler-dealer Manhattan real-estate cronies to a rally and the man’s court-ordered ankle bracelet went off, no one would bat an eye.

In other words, Trump is a postmodern creation, for whom traditional and time-tested rules do not apply. He is neither brilliant nor unhinged, neither ecumenical nor just a polarizer, not a wrecker and not a savior of the Republican party, but something else altogether. He does not defy conventional wisdom. There simply is no convention and no wisdom applicable to Donald J. Trump. For years postmodernists have lectured us that there is no truth, no absolutes, no timeless protocols worthy of reverence; Trump is their Nemesis, who reifies their theories that truth is simply a narrative whose veracity is established by the degree of power and persuasion behind it.

A reality-TV star, Trump appeals to those who despise reality-TV celebs like the Kardashians. A billionaire, he is the hero of those who hate billionaires like Mark Zuckerberg, Bill Gates, or Warren Buffett. A vain narcissist, he earns the loyalty of those who are repelled by the vain narcissism of Barack Obama. A man who dyes and does his hair, tans his skin, and stretches his face, he appeals to those who have neither the money nor the desire to do the same.

A self-described Republican, he attacks Republicans more than Democrats. An elite insider, he blasts elite insiders. He is both to the right and to the left of Cruz, Kasich, and Rubio. Trump rails against dirty campaign fundraising — and he assures us that no one knows such corruption better than he himself, since as a donor he used to spread cash around precisely to influence. Why else should anyone give?

If the rules of politics do not apply to Trump, how then can Trump break them? For Donald Trump, there is only one third rail: conventionality. If he, as advised, were to stop calling his rivals liars and crooks; if he, as urged, were to read sober and judicious speeches off teleprompters; if he, as counseled, were to talk in politically correct platitudes, Trump would turn doctrinaire and conformist — and be undone by reviving the very orthodox rules he once strangled, but that otherwise strangle outsider-insiders like himself. If Trump were to listen to a politico and lose 30 pounds, shorten his tie, cut off his comb-over, and wear earth-tone clothes, he would be finished.

His supporters want a reckoning with a system that has not so much failed as infuriated them. What drives their loyalty to Trump — if not the person, at least the idea of Trump — is a sort of nihilism. As a close friend put it to me this week, “I don’t care whether Trump wins or not, I just want him to f— things up as long as he can.”

In his supporters’ eyes, had Trump run in 2008 he might have lost, but he would at least have aired one Obama hit-ad a minute, with Rev. Wright screaming obscenities as a trailer crossed the screen beneath, collating the various quotations of praise from Obama for his personal pastor. If Trump had run in 2012, they believe, he would have cut off Candy Crowley — the moderator who hijacked the second presidential debate to save Barack Obama — in a cruder way than he screamed at Rosie O’Donnell.

Trump is the antithesis of his smears of his rivals. He is many things, but at least not “low energy.” He may be fat and pink and orange, but he is not “little.” He lies and fabricates, but he is not a sober and judicious constitutionalist: So “Lyin’ Donald Trump” wouldn’t work as a sound bite. Nor would “crooked Donald” — given that he would admit he trims a lot in business, whereas Hillary would deny to her last breath that the Clintons made $100 million by leveraging their name and offices in quid-pro-quo shakedowns.

To get a clearer idea of the feelings of Trump supporters, read the comments section following any mainstream news story that deals with race, class, and gender in politically correct fashion. A stream-of-consciousness litany of his supporters’ peeves, for good or ill, would run like this: The wrong people are in the news. Instead of generals, and small-business owners, and muscular workers, we instead see smarmy smart-asses, the pajama boys and mattress girls of the world of TV, who roll their eyes, wink about a joke only the anointed get, and smirk that what they say could have three different meanings — the Jon Stewarts, David Lettermans, and Stephen Colberts of Smug, Inc.

On race, Trump supporters are tired of hearing that black lives matter, while no one mentions that all lives matter. They are sick of seeing protesters wave the flag of the country they do not wish illegal aliens to be sent back to and trash the country they under no circumstances want them to leave. They don’t like getting a letter from an IRS that employs Lois Lerner — a letter that would be ignored with impunity by those who are here illegally, or who run the Clinton Foundation. They are tired of wealthy minorities claiming they are perpetual victims of ill-treatment at the hands of people who are less well off than they. They don’t like hearing from elites that huge trade deficits have little to do with loss of jobs or that cheating by our trade partners is just a passing glitch in free trade. They cannot stand lectures from those who make more money in an hour than they do in a year about their own bad habits or slothfulness. They don’t know what the on-screen savants mean by a leg-tingle or a perfectly pressed pant leg or a first-class temperament or a president as god — and they don’t care to find out. They do not hate political correctness so much as one-sided political correctness, which gives a pass to some to say things that would get others fired or ruined. They don’t want to be lectured that their own plight is part of a larger, healthy creative destruction or a leaner, meaner competitiveness or an overdue restructuring — by those who are never destroyed, rendered noncompetitive, or restructured. And they don’t like to be talked down to by the experts who ran up $10 trillion in debt, ruined the health-care system, dismantled the military, and screwed up the Secret Service, the IRS, NASA, and the VA. Trump is their megaphone, not their solution. The Trump supporters have seen plenty of politicians with important agendas, but few with the zeal to push them through; at this late date, they would apparently prefer zeal without agendas to agendas without zeal.

Trump has no loyalty to the Republican establishment or to the conservative movement. The apparent greatest attraction for his supporters is that he drives crazy those who worship Hillary Clinton and Barack Obama. And if the Republican establishment implodes with the Obamism it did not stop, well, so goes collateral damage — and in the process, woe to us all.

Trump is for a brief season our long-haired Samson, and the two pillars of the temple he is yanking down are the Republicans to his right and the Democrats to his left — and it will all land on top of us, the Philistines beneath.

“And he bent with all his might so that the house fell on the lords and all the people who were in it. So the dead whom he killed at his death were more than those whom he killed in his life.” -- Judges 16.30.

Article Link to the National Review:

ISIS Isn’t The Only One Calling For A Caliphate In Turkey

The Islamist group Hizb ut-Tahrir is hosting a series of conferences in Ankara and Istanbul calling for a caliphate to be reinstated and demanding the closure of the US and British embassies to end terror in Turkey.

By Pinar Tremblay
May 3, 2016

Ismail Kahraman, the speaker of the Turkish parliament, caused an uproar April 25 by suggesting that the principle of secularism be stricken from the new constitution. Secularism has been a thorny subject in Turkey since March 3, 1924, when the Ottoman caliphate was abolished. As scholars observe a rising trend of Islamophobia, there is simultaneously growing interest in the idea of a caliphate in Turkey.

The international Islamist group Hizb ut-Tahrir, established decades prior to the Islamic State (IS) in 1953, emerged with the ultimate goal of resuscitating the caliphate. With a small yet growing group of dedicated followers, Hizb ut-Tahrir’s Wilayat Turkiye has been quite active in organizing rallies, conferences and seminars for the past year.

In April, the group ran a weeklong social media campaign called “Oust colonialists, end terror.” On April 22, it held a conference on “The Issue of Terror, Real Culprits and Lasting Solution” at which five speakers discussed why Muslim-majority countries are facing an increasing number of conflicts, why terror attacks have skyrocketed in Turkey, who the real culprits are behind them as well as what Muslims can and should do about these problems. The answers were clear and straightforward. Hizb ut-Tahrir members said that colonial powers in Turkey were those supporting and generating terror. Therefore, to end terror attacks, they proposed that the US and British embassies be permanently closed and all their personnel expelled. Hizb ut-Tahrir sent letters to the embassies directly asking them to leave Turkey.

Hizb ut-Tahrir is not shy about criticizing the ruling Justice and Development Party (AKP). Although Hizb ut-Tahrir appreciates the leadership role President Recep Tayyip Erdogan plays in defense of the rights of Muslims, the group finds it insufficient and ineffective. In Hizb ut-Tahrir's video presentation about Western countries supporting terror in Turkey, the photos in the background were poignant: First Erdogan’s picture would appear with words asking the West, “Are you with us or with the PYD?” in reference to the Democratic Union Party, a Syrian Kurdish group. Then Turkish Foreign Minister Mevlut Cavusoglu’s photo would appear with his statement, “Just because we think differently on the PYD, we cannot quarrel with the United States.”

Hizb ut-Tahrir’s activities have generated not only an increasing number of supporters but also angry critics. On March 10, civil society organizations in support of secular values lodged an official complaint with the public prosecutor against Hizb ut-Tahrir’s seminars. On social media, several comments appeared asking how a terror organization can hold conferences in the center of Ankara. Some seasoned pundits have stated that Hizb ut-Tahrir’s conferences in Turkey are an indication of Turkish support for jihadis and IS. But is this really the case?

Mahmut Kar, the media bureau chief for Hizb ut-Tahrir Turkey, told Al-Monitor, “One must question why a group that is proposing concrete and strong solutions to the terror problem of the country, a group whose members do not even carry a Swiss army knife, is charged with terrorism.”

Hizb ut-Tahrir holds seminars and conferences to reach out to other groups. The party is open to discussion and always eager to take questions from the domestic or foreign press. It is quite telling to see that deep rifts within Turkish society prevent secular analysts from approaching Hizb ut-Tahrir and speaking with it directly. Also of note, Hizb ut-Tahrir members almost always appear in designer suits, sometimes wearing ties, with well-groomed beards. Though women occupy a separate section in their audiences, Hizb ut-Tahrir does not require the full face veil. Women form an active part of the organization.

Kar was straightforward. “Hizb ut-Tahrir condemns any attacks on civilians anywhere; it is not acceptable to Islam. We submitted letters to the US and British embassies in Ankara because we believe these two are the countries that support terrorism and themselves devour terrorism. We also acknowledge that from time to time, the Turkish state itself feeds upon terrorism for domestic policy goals. We observe that the Turkish leaders have been followers of the UK and currently the US governments. Cutting diplomatic, economic and political links with these countries may be against realpolitik. But then we must remember that realpolitik means to accept the conditions that you have. Then we go in vicious cycles. If you act according to realpolitik, how do you end terror?”

For Hizb ut-Tahrir, which is critical of nationalism and colonialism, the answer is the reinstatement of the caliphate. The group is critical of the brutal methods of IS as attempts to tarnish the concept of the caliphate and view the group as a US project. It has repeatedly condemned IS attacks. Kar told Al-Monitor that in contemporary Turkey, the caliphate is widely discussed for two reasons: IS brutality and the fact that Muslim populations lack a leader. The argument, for many, is over whether Erdogan’s executive presidency is enough or a caliphate is needed for Islamic unity. Hence in early March, Hizb ut-Tahrir’s seminars in Istanbul and Ankara did not question the reasons for a caliphate, but discussed the kind of caliphate that would be best for believers.

Kar said, “In March, we gathered more than 5,000 participants who attended the seminar with a yearning for the caliphate. This burning desire for Muslims to live under the rule of the caliphate was always there, but from time to time it was suppressed by foreign demands such as democracy. Today Muslims in the region, including Turkey, see that promises of democracy have failed them and it is not the way for them. Hizb ut-Tahrir never lied to the Muslims about these truths.” Kar also observed, “In Turkey, politics fails to provide solutions to the problems.” Indeed, this view is common to different religious groups and civil society organizations in Turkey.

So while anti-AKP groups are fighting each other over whether the AKP can be trusted with sustaining a secular system in the new constitution, multiple Islamist groups are flourishing all over Turkey. To brand all groups with black flags and Arabic script as terrorist and to criticize each Islamist group without bothering to understand their individual demands may not be the most effective method to sustain a secular system in Turkey.

Article Link to Al-Monitor:

Islamic State isn’t the only one calling for a caliphate in Turkey

Trump and China: New Realism Or Business As Usual?

The Asia Times
May 3, 2016
Donald Trump has emerged as the presumptive 2016 Republican nominee for US president and recently outlined his views on foreign policy, including how he would deal with China.

Asserting that America under the foreign policies of President Barack Obama no longer has clear goals, Trump singled out what he called China’s attack on American industry and wealth as a critical issue.

“Our president has allowed China to continue its economic assault on American jobs and wealth, refusing to enforce trade rules — or apply the leverage on China necessary to rein in North Korea,” Trump said. “He has even allowed China to steal government secrets with cyber attacks and engage in industrial espionage against the United States and its companies.”

On Sunday at a rally in Indiana, the candidate referred to what he called China’s economic “rape” of the United States through manipulating its currency to boost its exports.

The New York businessman has offered few specifics on how he would deal differently with China other than asserting on his campaign website that he would provide “leadership and strength at the negotiating table.” The goal would be to end the Great Wall of Protectionism” set up by China with tariff and non-tariff trade barriers.

Silent on Chinese military buildup

Trump, however, so far has not addressed China’s large-scale military buildup, including its development of new longer-range nuclear and conventional missiles, or it DF-ZF hypersonic glide vehicle that was recently tested and that US officials say is designed to penetrate advanced missile defenses.

On Chinese aggression in building up islands in the South China Sea, Trump has not outlined any national security-oriented solutions. Asked by the New York Times how he would combat Chinese assertiveness in the region, Trump suggested the use of economic power to alter Beijing’s behavior, again with no specifics.

“We have great economic — and people don’t understand this — but we have tremendous economic power over China,” he said. “And that’s the power of trade. Because they use us as their bank, as their piggy bank, they take but they don’t have to pay us back.”

More business engagement?

The comments suggest Trump as president would continue many of the business-oriented approaches toward China that have dominated relations between Washington and Beijing for successive administrations since the 1980s.

This approach is based on the questionable assumption that trading with a nuclear-armed communist dictatorship – even one that has all but abandoned its Marxist-Leninist economics but kept its Leninist political controls – eventually will produce a more benign and “normal” China. The approach has not worked, however.

Take two examples. Chinese President Xi Jinping, who has consolidated more power than any recent ruler since Mao, in September made two high profile agreements with the United States. Within months, China had violated both.

The first was the Chinese leader’s promise not to militarize some of China’s 3,200 acres of newly created South China Sea islands. Within months of the pledge, the People’s Liberation Army began deploying anti-aircraft and anti-ship missiles and warplanes on Woody Island in the Paracels, claimed by both China and Vietnam.

Xi also formally agreed at the September summit in Washington, under pressure from Obama over widespread Chinese hacking of large data sets, that China would halt cyber economic espionage. Earlier this year, US intelligence leaders told Congress that Chinese cyber spying continued unabated.

The notion of trade with China as an engine of political reform has been a policy promoted by foreign affairs elites like Henry Kissinger and others. The idea for decades is that the supposed magic effect of trade and financial engagement with China would create a new middle class that would demand and receive more rights and freedoms from the government.

Instead, China’s leaders today are engaged in ideological warfare against what they see as an encroachment of western democracy and freedoms. At the same time, the party-led system in China is beset with pervasive corruption, as seen in the nationwide anti-corruption drive that has netted hundreds of Chinese officials, including several senior party and military leaders, jailed for economic crimes.

Hardline leaders in the party and military also are on the rise, with the backing of Xi, who has shown himself to be one of China’s more devoted adherents of the guiding state ideology of Marxism-Leninism-Mao Zedong thought and who has continued to consolidate power as few leaders before him, while moving the Chinese system in a more totalitarian direction.

Beijing as strategic deceiver

Under Xi, China has been using strategic deception to lull the United States into falsely believing China poses no threat, at the same time Beijing has been covertly supporting rogue states like Iran and North Korea with arms and weapons technology.

Xi has warned in at least two internal speeches since 2013 that China is besieged by hostile US forces seeking to impose western-style democratic reforms on the country. Military leaders also regularly rail against the United States as a declining but still dangerous main enemy.

An example was the decision by China last week to block the visit to Hong Kong by the aircraft carrier USS John C. Stennis, amid tensions over the South China Sea. Despite being planned months in advance, the ship was turned away at the last minute, in apparent retaliation for the carrier’s visit to the disputed South China Sea last month. During the carrier deployment US Defense Secretary Ash Carter traveled to the ship and again asserted American intentions to sail or fly any place in the sea.

Trump is correct in identifying weak US leadership toward China as a key reason Beijing has become more assertive and belligerent. China’s leaders correctly see an opportunity to further diminish American power and the widely popular ideals of democracy and freedom while working to replace them with the Chinese authoritarian model that emphasizes prosperity under strict party-led controls.

But the solution to the threats posed by China, whether in the South China Sea and against American government and private sector computer networks that have been pillaged for decades by Chinese hackers, is not as simple as conducting tougher negotiations, as Trump advocates.

The failed record of unfettered engagement with China on trade and economic issues has not solved the problems posed by increasing Chinese hegemony and threatening activities.

A more comprehensive strategy of countering Asia’s emerging superpower is needed. That strategy must be centered on American interests, as Trump correctly notes. But it also needs to understand the root cause of the threat as China’s unsustainable reformist-style communist system, combined with the growing trend of hardline People’s Liberation Army military leaders who appear increasingly eager to test out some of China’s rapidly expanding high-technology forces in a crisis, and thus trigger a conflict.

Article Link to the Asia Times:

Why Hillary Clinton Won’t Offer a Bold Economic Agenda

Against Donald Trump, she won’t have to.

By David Dayen
The New Republic
May 2, 2016

In Barack Obama’s interview with The New York Times’s Andrew Ross Sorkin, published on Sunday, he attempts to explain his economic legacy. The president begins, tellingly, by making appraisals that no American worker would ever make.

“I actually compare our economic performance to how, historically, countries that have wrenching financial crises perform,” Obama says. “By that measure, we probably managed this better than any large economy on Earth in modern history.”

Unfortunately, workers who haven’t seen a raise in 15 years, and have seen their living standards decline even more rapidly through the last eight, don’t grade on a curve. They don’t compare their plight to Norway’s in the 1980s or Japan’s in the 1990s. They look at their own lives and decide whether or not they’ve improved.

Have they? In the aggregate, yes; we have experienced an economic recovery. But in an age of skyrocketing inequality, we haven’t all felt that recovery. And that makes the politics of the post-Obama age harder for Hillary Clinton and Democrats nationwide.

Pavlina Tcherneva, an economics professor at Bard College, has contributed the seminal chart for thinking about how the U.S. economy works today. In the 1940s and 1950s, income growth after recessions went almost exclusively to the bottom 90 percent of earners. That began to change throughout the decades, until the 2009-2012 period, where more than all the income growth went to the top 10 percent; the bottom 90 percent actually saw their incomes fall in this most recent post-recession period. That’s where it gets so hard to assess the Obama economy: All this upward redistribution means that we can have a recovery without many of our citizens feeling it.

Obama’s defense of his economic record further assumes that countries with financial crises are doomed to sclerotic economic performance for years, and that our middling recovery therefore represents an outstanding achievement. But as I wrote in the New Republic back in 2014, the president’s own former economic adviser Christina Romer showed in a paper that economic recoveries don’t have to be slow. Policymakers have alternatives beyond enduring the hardship and hoping to eke out something half-decent.

As it happens, Obama had a host of untried options, none of which required sign-off from Congress, that could have improved the economy for everyone—a functional foreclosure mitigation program, measures to limit the increased leakage of corporate profits to shareholder payouts, or aggressive enforcement of the antitrust laws to increase competition, to name a few. He also pivoted to deficit reduction within a year in office, and the resulting austerity was unhelpful. In combination, these actions not taken—and taken—not only slowed the recovery, but also ensured it would be unequal. Whatever benefits eventually arrived would be shared by a select few.

Obama appears to think that his problem was not a failure to explore these other options, but merely one of public relations. “We were moving so fast early on that we couldn’t take victory laps,” Obama said. He blamed misinformation from the Republican noise machine for diminishing his achievements. He blamed himself for not explaining clearly how he saved the nation from depression. And in darker moments, he blamed transformative modern economic forces like globalization and advancing technology—forces that, in Obama’s view, no president could have adequately dealt with.

This all rests on some questionable assumptions—we’re not losing jobs to robots, for one. But beyond that, blaming the rubes for not knowing a great economy when they see one, or deciding that the path taken was the only one possible, reveals in Obama a certain disconnectedness from the lived experience of most Americans, particularly those in the working class.

That disconnectedness is not just limited to Obama; it’s increasingly true of the Democratic Party leadership as a whole. Research shows that more highly educated adults are increasingly more Democratic, creating a party rooted in the professional classes rather than in rank-and-file workers. Additionally, geographical separation by income ensures that the wealthier, more educated clusters don’t have to come into contact with anyone from outside their social class. This creates a concentrated party elite physically cut off from the broader public. Inside these bubbles, the economy looks pretty good; outside, the story is less clear.

Having those elites admonish people for not recognizing the brilliance of their policy triumphs must sound to the unwashed masses like their leaders are speaking a different language. And that’s going to be a problem for the Democrats running on Obama’s record in the 2016 elections, particularly the woman likely to be at the top of the ticket.

Even before Bernie Sanders’s entry into the race, Hillary Clinton spent much of the primary season empathizing with people who have not seen their fortunes raised after the Great Recession. “Many are still barely getting by,” she said to the New America Foundation in May 2014. “The dream of upward mobility that made this country a model for the world feels further and further out of reach. And many Americans understandably feel frustrated—even angry.”

"Thanks to Trump, Clinton can play to people’s fears instead of their hopes, without needing to emphasize economic justice or rebalancing the inequality scales."

As the campaign has gone on, however, she’s also retreated, when politically expedient, to a defense of Barack Obama’s record, an inescapable task for the standard-bearer of the current president’s party. “I’d give him an A,” Clinton told The Boston Globe last October. “I don’t think he gets the credit he deserves for saving our economy from falling into a great depression … for really being as responsive as he could possibly be given the obstructionism that he faced with the Republicans in Congress.”

This dichotomy—supporting Obama’s record while acknowledging that it has not benefited everyone—will be a defining challenge for Clinton and everyone else running for office as a Democrat. Tout the recovery too much and you appear out of touch; criticize it too much and you appear in agreement with persistent Republican cries about Obama’s economic failures.

This would be a fascinating puzzle for Clinton to solve if this were a normal election. However, she is overwhelmingly likely to have as a general-election opponent Donald Trump, a sexist and racist lout running on extreme nationalism. Trump does pitch his appeal to working-class voters, often leading speeches by condemning corporations sending jobs overseas and the trade deals that facilitate them. But he intertwines that with not-so-hidden appeals to race and a stunning lack of interest in policy details.

In many respects, Trump is the perfect foil for the Clinton campaign; thanks to him, she might not have to take a firm stand on the economic question at all. She can run an identity-based campaign, seeking support from African-Americans, Latinos, and women, tinged with a show of policy expertise that reveals a superior fitness for office. She can play to people’s fears about Trump instead of their hopes, always an attractive option in politics, without needing to emphasize economic justice or rebalancing the inequality scales.

This means that the general election could feature far less detail about Clinton’s plans for financial reform or health care or education than the primary against Sanders has. The emphasis will be on tolerance and respect for immigrants or women, and the basic question of whether you want Donald Trump in control of the nuclear launch codes. Why talk about Obama’s track record when you can talk about Trump’s?

That’s likely a winning strategy. A coalition of professionals, minorities, and people freaked out about the prospect of a Trump presidency will likely amount to a majority of Americans for this election. But it isn’t a majority that’s going to push a Clinton presidency to prioritize the struggles of the working class. And I don’t know if there’s a way to change that, to turn an election featuring Donald Trump into an election about ideas.

During the primary, Clinton memorably asked, “If we broke up the big banks tomorrow … would that end racism?” Set aside the fact that racism was at the heart of the subprime mortgage crisis, when toxic loans were handed out disproportionately to African-Americans. Clinton’s question reveals a clever way to opt out of this dilemma of how to properly credit Obama’s economic gains in an age of inequality, when all those gains go to the top. She can find other points of emphasis, enough to win a general election. But failing to address the real economic pains felt by large swaths of the country will not only exact a political price down the line, it will ensure that those pains continue far beyond when they could have been eased.