Tuesday, May 17, 2016

Tuesday, May 17, Night Wall Street Roundup: Wall St. Sells Off Amid Fed Rate Hike Jitters

By Lewis Krauskopf
May 17, 2016

Wall Street sold off on Tuesday as investors boosted their bets on the Federal Reserve raising rates later this year, while Home Depot dragged on indexes following its quarterly report.

U.S. consumer prices recorded their biggest increase in more than three years in April as gasoline and rents rose. The data pointed to a steady inflation build-up that could give the Fed ammunition to raise interest rates later this year.

Also on Tuesday, a Fed policymaker said he will push for an interest rate hike in June or July, and two others still see up to three rate increases this year, leaving the door open to a change in monetary policy relatively soon.

Traders now see the probability of a rate hike after the Fed's November meeting at 58 percent, up from roughly 42 percent on Monday, according to the CME FedWatch tool.

"The equity market is taking cues from stronger data and some of the comments from Fed members in terms of maybe hiking more than is priced into the market," said Patrick Maldari, senior fixed income investment specialist at Aberdeen Asset Management in New York.

The Dow Jones industrial average .DJI fell 180.73 points, or 1.02 percent, to 17,529.98, the S&P 500 .SPX lost 19.45 points, or 0.94 percent, to 2,047.21 and the Nasdaq Composite.IXIC dropped 59.73 points, or 1.25 percent, to 4,715.73.

Utilities .SPLRCU and consumer staples .SPLRCS, both high-dividend-paying groups that tend to be sold when the expectation of higher rates increases, were the worst performing S&P sectors. Nine of ten sectors ended lower.

The S&P 500 is virtually unchanged for 2016. While the benchmark index has risen about 13 percent since February lows, the rally fizzled out in the last few weeks amid mixed corporate earnings and economic data.

"For every step forward in the market like yesterday, it just seems like it’s met with a step back on a day like today,” said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.

Home Depot (HD.N) boosted its sales and profit forecasts for the year after a stronger-than-expected first quarter. But its shares, which have outperformed the consumer discretionary sector over the past year and last week touched an all-time high, dropped 2.5 percent and were among the biggest drags on the S&P 500 and the Dow.

Gloomy reports from retailers had clouded the market last week. Wal-Mart (WMT.N) and Target (TGT.N) are set to report results later this week.

AbbVie (ABBV.N) fell 3.5 percent to $60.25 after Coherus (CHRS.O) said the U.S. Patent and Trademark Office agreed to review its petition to make a copy of AbbVie's top-selling drug. Coherus jumped 15.9 percent to $18.85.

About 7.5 billion shares changed hands on U.S. exchanges, above the 7.2 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Declining issues outnumbered advancing ones on the NYSE by 1,932 to 1,061, for a 1.82-to-1 ratio on the downside; on the Nasdaq, 2,106 issues fell and 766 advanced for a 2.75-to-1 ratio favoring decliners.

The S&P 500 posted 7 new 52-week highs and 5 new lows; the Nasdaq recorded 23 new highs and 81 new lows.

Article Link to Reuters:

Would Trump Undo Obama's Environmental Legacy?

By Bill Murray
Real Clear Politics
May 17, 2016

Of the tens of thousands of words spoken by Donald Trump in the 11 months since launching his Republican presidential primary blitzkrieg, very few involved specifics on energy and environmental policy. Yes, it’s true that in the past, i.e. 2012-2015, he called climate change a variety of epithets: a “hoax,” “bullshit” and a “con job.” But Trump’s verbal volatility and ability to flip-flop on any policy have made his actual policy positions difficult to pin down.

So his discussion on CNBC on May 5 was important because it came across as among his least-bombastic and most coherent interviews concerning what he would do in the first 100 days of his presidency, if elected.

“More and more I hear it, the business people talk about regulation more than they talk about taxes…. And with energy … we’re going to be opening up energy, we’re going to get the miners back to work, we’re going to be doing a lot to spur the economy,” Trump said.

A simple parsing of his phrases – “opening up energy” or “put the miners back to work” –implies overturning important elements of President Obama’s Clean Power Plan (CPP), which is the main method by which the U.S. plans to meet its emissions obligations promised at the Paris climate change convention in December.

“According to the attitude that he has expressed, he would be a major threat to health and the environment” if elected, said David Goldston, the director of government affairs for the Natural Resources Defense Council. “He doesn’t believe in climate change, he doesn’t believe in the ozone hole, and he talks about dismantling the EPA.”

How is a wholesale rollback of Obama’s environmental regime possible? The quick answer is that the failure of cap-and-trade legislation in 2010 forced the administration to try and achieve its environmental goals via the executive branch. By deciding to go down the executive-action path, the risk existed of a rollback if Republicans regained the White House.

The easiest way to undo Obama’s environmental efforts would be for a President Trump to simply order his administration to stop working on a series of environmental rules that are still in draft form or mired in the federal court system. The CPP would qualify, given that federal courts may not decide on its legality until 2017. Other EPA-sponsored energy-related rules that could be quickly undermined by a Trump presidency include a “well-control” methane rule just finalized last week, and a Waters of the United States rule, both of which are struggling to make it through the courts.

“He’s going to be an old-school pro-business Republican with a harder edge,” said Mike McKenna, a GOP strategist who deals with energy and environment issues. “He would target the things that underpin the whole structure of the Obama environmental policy. He’ll look at the Clean Power Plan and say, ‘Are we out of our frigging mind?’”

If Trump wanted to get into the guts of the Obama administration’s long-term plan to move the United States away from a carbon economy, he could start by amending the White House Council on Environmental Quality’s “social cost of carbon” calculation or changing the framework behind the EPA’s 2009 Endangerment Finding. The latter is the most important legal precondition supporting Obama’s (and the environmental community’s) long-term environmental agenda.

Other analysts express doubt about Trump’s ability or desire to upend current environmental trends, believing the long-standing administrative rules regarding public comment and judicial review may make any rollback of Obama’s actions not worth Trump’s time or energy.

“He can’t undo it all. He can reinterpret a lot, but reinterpreting doesn’t necessarily make it gone forever, or even reverse the trend,” said Kevin Book, a principal at ClearView Energy Partners. If elected, “he has the administrative power, but if you’re going to reverse findings, after all that has happened, you’re going to need a lot of ink, a lot of time and a lot of lawyers.”

A Trump administration would need support from Congress, and given the possibility that Democrats may regain control of the Senate, Trump’s deal-making tendencies scare any number of Republican energy purists. Trump’s complete lack of ideological obligations considering environmental policy, and his desire to negotiate big changes in U.S. policy, mean it is possible he could offer Democrats a national tax on carbon in return for comprehensive tax reform or immigration reform, according to some analysts.

Such a turn of events – Trump fulfilling Obama’s most ambitious environmental legislation while undermining his executive actions – would be a major irony, especially in light of the political environment that allowed Trump to become the presumptive Republican nominee in the first place.

Article Link to Real Clear Politics:

Big Win For Little Sisters

President Obama’s contraceptive mandate gets a high court smackdown.

By William McGurn
The Wall Street Journal
May 17, 2016

First the good news: Though it was more a TKO than a straight-up ruling, the Little Sisters of the Poor prevailed at the Supreme Court on Monday in their fight against the ObamaCare contraceptive mandate.

True, the justices made clear that they were not ruling on the merits, which is why so many headlines speak of the court’s having “punted” on the case. Even so, in a unanimous decision they made the path forward much easier for the sisters and much more difficult for the Obama administration.

To begin with, the justices vacated the lower-court rulings the sisters were fighting. The parties, the court said, should have another opportunity to work out a way to deliver contraceptives that doesn’t violate the religious objections of the Little Sisters and their co-plaintiffs.

Most important, the Supreme Court took away the administration’s tool for bullying: The government, it said, “may not impose taxes or penalties” on those who refuse to authorize their plans to provide the contested coverage.

The bad news is the larger picture. For the main threat to religious liberty these days isn’t the Obama administration or even this noxious mandate. It’s an aggressive federal government intruding into areas of life previously left unmolested, coupled with an increasingly larger proportion of Americans who have no idea what religious liberty is and why we have it.

The ironies are legion. At this moment in America’s history, religious liberty has never had more able champions—including but not limited to the Becket Fund for Religious Liberty, the Alliance Defending Freedom, and First Liberty. These outfits have won many significant cases in recent years. Becket Fund attorneys, for example, are now five wins and zero losses at the Supreme Court.

Unfortunately, a growing portion of society regards religion as a collection of irrational beliefs. They simply cannot fathom why folks with such beliefs ought to be exempt from laws that seem obvious to them and that everyone else is expected to obey.

This view helps explain why so often the aim in religious-liberty cases is not accommodation but submission. In this case for example, when the justices asked the Obama administration if there were any ways to provide women contraceptives other than hijacking the Little Sisters’ health plan against their will, the administration hemmed and hawed, first answering “no” until it conceded that maybe it could be done.

In short, the Obama administration’s goal was not just getting contraceptives to women. It was also to do so in a way designed to force religious groups such as the Little Sisters to cry “uncle.”

Nor is this approach limited to contraceptives. Last summer, when the Supreme Court unearthed a constitutional right to same-sex marriage, the hope was that at least the marriage wars would be over. The reality is we’ve simply entered Stage Two. In this stage dissenters are brought to heel—whether this means driving Catholic agencies out of the adoption business, fining an Oregon couple $135,000 for refusing to bake a cake for a same-sex wedding, or seeking the dismissal of a Wyoming judge who won’t officiate at gay marriages.

And it’s all fed by people who regard our religious liberty protections as little more than a free pass for bigotry.

Whatever else this is, it’s not the live-and-let-live world Justice Anthony Kennedy promised in 1992’s Planned Parenthood v. Casey, when he defined liberty as “the right to define one’s own concept of existence.” Clearly some concepts of existence are more equal than others. It’s also striking how reliant the anti-religion side is on government coercion—and a zeal for punishing heretics that itself reflects a quasi-religious fervor.

The misunderstanding of religious liberty, alas, is not confined to the left. On the right, too often it is treated as a parochial issue of import only to the parties involved.

To their credit, this is not a mistake libertarians make. Ilya Shapiro, a senior fellow in constitutional studies at the Cato Institute, notes that while many libertarians would not share the Little Sisters’ views on abortion, marriage and contraception, they appreciate that every American has a stake in beating back a federal government poking its nose where it doesn’t belong.

“The government created this whole situation,” says Mr. Shapiro. “It’s not anything the Little Sisters were doing. It’s that ObamaCare came along and tried to force the nuns to do something that violated their deepest beliefs.”

In the end, this case—or one like it—will be back. The good news is that the court has just stripped the government of much of the firepower it would have used, vacating the appellate court rulings in its favor and forbidding the administration from fining dissenters into submission.

“The solution the justices pointed to has been around for years but this administration has refused all opportunities to compromise,” says the Becket Fund’s president, William Mumma. “On Monday the Supreme Court smacked them down for it.”

Article Link to the Wall Street Journal:

The Dangerous Insecurity of Donald Trump

By Eugene Robinson
The Washington Post
May 17, 2016

WASHINGTON -- Donald Trump's opponents in the primaries were right to call him a con artist, a narcissist and a pathological liar. Just ask "John Miller."

That's one of the names Trump used with journalists to burnish his status as a bold-faced Manhattan celebrity; he also called himself "John Barron." Both personae were supposedly publicists who just wanted to explain what a wonderful guy Mr. Trump was and how beautiful women seemed unable to resist his charms.

Last week, The Washington Post ran a story about the "Miller" and "Barron" ruses, which took place years ago, and posted a 1991 recording of "Miller" explaining why Trump was dumping Marla Maples. "He's coming out of a marriage, and he's starting to do tremendously well financially," the imaginary publicist says to a reporter from People magazine. "Actresses just call to see if they can go out with him and things." Madonna is ostentatiously name-dropped as someone who "wanted to go out with him."

The voice is Trump's. He denies it, for some reason -- "I don't think it was me," he said Friday, "it doesn't sound like me" -- but the timbre, cadence and word choice on the recording are pure Trump. It could only be him or his evil twin (as if he needed one).

The Post reported that "some reporters found the calls from Miller or Barron disturbing or even creepy; others thought they were just examples of Trump being playful." Put me firmly in the "creepy" camp.

I don't go so far as to think Trump could have believed these imaginary friends were real. But I do believe that Republican presidential contenders Marco Rubio (who called Trump a con artist), Bobby Jindal (who called him a narcissist) and Ted Cruz (who called him a pathological liar) should feel vindicated. And I believe the nation should be deeply worried about what sort of person the GOP is about to nominate for president.

Does it really matter if Trump had a bit of fun at the expense of some reporters two or three decades ago? It wouldn't if he were merely asking for another season of "The Apprentice." He wants us to make him the most powerful man in the world, and the "Miller" and "Barron" episodes -- along with the transparently untrue denials that they ever took place -- betray a level of ambition and insecurity that voters should find deeply alarming.

In my experience, most successful people could be described as needy in some sense. Trump, however, takes neediness to a bizarre and frightening extreme.

He's the son of a wealthy developer who expanded his father's empire. In his younger days, he was a rich and well-connected man about town. It is no surprise that he enjoyed the company of beautiful women. But that, apparently, wasn't nearly enough for Trump. He had to be widely seen with such women on his arm, and he had to be both envied and admired.

When he decided to trade a woman in for a newer model -- I know that sounds crude, but this was his modus operandi -- he used fake names to call reporters with his side of the story. Was he too cheap to hire a real publicist? Did he believe he was so much more clever than the journalists that they wouldn't know it was really him? (They knew.) Was he obsessed with being portrayed in the gossip columns as "a good guy," which is what "John Miller" calls him in the recording?

And why deny it now, given the clear evidence of the tape? Why not just laugh it off as a youthful or perhaps middle-aged indiscretion? Why not just say he was having a little fun at the media's expense? "It wasn't me" is only an effective defense absent proof beyond a reasonable doubt that, you know, it was.

I'm taking this seriously because Trump is asking to be taken seriously -- which means he wishes to be taken at his word. Someone should explain to him how this works.

He has built a remarkable career on bluster, branding and relentless self-promotion. Self-regard bordering on self-worship and a willingness to bend the truth may have been assets that helped his rise. Insecurity and a need to be loved could have given him motivation. For a vainglorious mogul who lives to plaster his name across the New York skyline -- and whose most consequential decision is whether to use travertine marble or Carrara -- these are useful traits.

Article Link to the Washington Post:

Oil Extends Gains, U.S. Crude At Seven-Month High On Supply Concerns

By Aaron Sheldrick
May 17, 2016

Oil futures rose for a second straight session on Tuesday, with U.S. crude hitting a seven-month high, as the market focused on supply disruptions that prompted long-time bear Goldman Sachs to issue a bullish assessment on near-term prices.

Crude oil prices have rallied for most of the past two weeks due to a combination of Nigerian, Venezuelan and other outages, declining U.S. output and curtailments of Canadian crude after fires in Alberta's oil sands region.

U.S. West Texas Intermediate (WTI) futures were up 67 cents at $48.39 a barrel at 0635 GMT, the highest since October.

Brent crude futures were up 37 cents at $49.34 a barrel, near the six-month high of $49.47 reached on Monday.

Outages throughout May will average 3.2 million barrels per day (bpd), Energy Aspects analyst Amrita Sen said in a research note.

"The longer these outages, the quicker the pace of rebalancing," Sen said.

"Although refining margins remain weak, we maintain our view that persistent crude stock draws (will) begin by end Q2 16," she said.

The disruptions triggered a U-turn in the outlook for the oil market from Goldman Sachs. The U.S. bank, which had long warned of global storage hitting capacity and of another oil price crash to as low as $20 a barrel, now sees U.S. crude trading as high as $50 in the second half of 2016.

A further bullish note was sounded by the U.S. Energy Information Administration (EIA) when it said shale oil output is expected to drop in June for an eighth consecutive month.

Shale output is expected to fall by nearly 113,000 bpd to 4.85 million bpd, as the nearly two-year slump in prices continues to undermine profitability for drillers, the EIA report released on Monday shows.

Oil prices were also drawing support from fires burning around the Canadian oil sands hub of Fort McMurray.

The fires were growing and moving rapidly north late on Monday, forcing firefighters to shift their focus to protecting major oil sand facilities north of the city, officials said.

A dozen work camps south of the major projects faced mandatory evacuation notices.

Tuesday, May 17, Morning Global Market Roundup: Asian Shares Recover After Apple, Oil Boost Wall Street

By Hideyuki Sano
May 17, 2016

Asian shares recovered from two-month lows on Tuesday after a rebound in technology giant Apple Corp and oil price gains boosted Wall Street.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.8 percent, extending the recovery from its two month low set on Friday. Japan's Nikkei .N225 gained about 1.1 percent.

European shares are seen opening higher with spread-betters expecting 0.3-0.4 percent gains in Europe's major bourses. Euro stoxx 50 futures STXEc1 opened up 0.6 percent.

"The market's risk appetite seems to be coming back, or rather, its excessive pessimism is easing," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.

Wall Street rallied sharply on Monday, fueled by a jump in Apple shares and gains from energy stocks that were backed by stronger oil prices, with the S&P 500 .SPX gaining 1.0 percent. [.N]

Shares in Apple (AAPL.O), which had lost about one-fifth of their value in the past month on worries about the company's slowing sales growth, finished 3.7 percent higher after Warren Buffett's Berkshire Hathaway (BRKa.N) reported taking a stake of about $1 billion in the iPhone maker.

Oil prices were at six-month highs as the market focused on supply disruptions that prompted long-time bear Goldman Sachs to issue a bullish assessment on near-term prices. Goldman had long warned of global storage hitting capacity and of another oil price crash to as low as $20 per barrel.

A combination of Nigerian, Venezuelan and other outages, declining U.S. production and virtually frozen inflows of Canadian crude after wildfires in Alberta's oil sands region helped to lift oil prices.

"The increasing intensity in supply-side disruptions in the oil market should see prices well supported in the short term," ANZ said in a research note.

Brent crude futures LCOc1 rose 0.6 percent to $49.29 per barrel, after having risen 2.4 percent on Monday, when it rallied to $49.47 earlier, its highest since early November.

U.S. crude's West Texas Intermediate (WTI) futures CLc1 went up 1.1 percent to $48.24, having risen 3.3 percent on Monday.

Yet concerns about a slowdown in the Chinese economy could weigh on Asian shares in the near term after data published on Saturday showed investment, factory output and retail sales all grew more slowly than expected in April.

In the past month, shares in Greater China were among the worst performers globally. Hong Kong, Taiwan and Shanghai shares have all registered falls of around 7 percent.

Mainland Chinese shares were flat, with Shanghai composite index .SSEC still hovering near two-month low hit last week, as investors fret that Beijing might pull back on monetary stimulus, focusing on structural and financial reforms even as the economic recovery struggles to gain traction.

"The logic underpinning a market rebound has collapsed because the economy is not good, but the government refrains from using fresh stimulus," said Li Kongyi, strategist at Fortune Securities.

In the currency market, the British pound rose 0.6 percent to $1.4478 GBP=D4 helped in part by a report that the "remain" camp held a 15-point lead over its "leave" rivals in Britain's EU referendum campaign.

The dollar was little changed against other currencies. Against the yen, the U.S. currency stood at 109.09 yen JPY=, stuck in its well-worn range in the past week.

The euro traded at $1.1315 EUR=, off its two-week low of $1.1283 touched on Friday.

The Australian dollar rose 0.8 percent to $0.7345 AUD=D4 after minutes of the Reserve Bank of Australia's May policy meeting surprised some investors with a less-dovish-than-expected tone.

Article Link to Reuters:

Oil Rally Suggests Supply Worries Wane, But For How Long?

By Devika Krishna Kumar
May 17, 2016

A rally in U.S. crude oil prices recently has put the market on its firmest footing since the rout started in 2014, with the spread between prices for near-term delivery and future delivery narrowing, suggesting the worst of the supply glut may be over.

Oil prices in global markets have been lifted in the past week by news of falling U.S. production and output disruptions in Canada and Nigeria.

The production cuts are seen helping to rebalance a market awash with excess crude oil, pushing up prices for NYMEX June futures delivery CLc1 up as much as 11 percent in the last four days. It settled on Monday at $47.72 a barrel.

Traders are watching the relationship between futures contracts expiring later this year and similar contracts expiring in late 2018. The spread, or contango, has narrowed to its smallest margin since November 2014.

The narrowing contango suggests excess supply is finally being reduced after years of overproduction, but if U.S. shale producers ramp up drilling again the market may yet fall back.

With several U.S. shale producers saying they would turn the spigots back on if prices recovered to about $45 a barrel, the market has been bracing itself for renewed supply as prices recovered from 12-year lows, but that may not happen quickly.

"We're not seeing any signs that the U.S. energy industry is in a hurry to respond to a jump in demand because they're still cutting back on projects," said Phil Flynn, senior energy analyst at Price Futures Group.

As prices inched close to $50 a barrel CLc1 LCOc1 last week, the oil rig count fell further to October 2009 lows, suggesting U.S. shale producers may yet need even higher prices to restart production.

The rebound in near-term prices has also driven hedging activity that has suppressed the prices of later-dated contracts. The discount for crude for delivery in December 2016 versus delivery in December 2018 CLZ6-Z8 narrowed to $1.21, after a spread as steep as $8 in December 2015.

The December 2016 discount to December 2017 contract CLZ6-Z7, one of the most actively traded spreads, also narrowed by the most since November 2014 to as low as 60 cents.

"To me, it suggests that the market balances are tighter than what people have believed or generally the consensus has been in recent months," said John Saucer, vice president of research and analysis at Mobius Risk Group in Houston.

Hedging amongst producers has been active, with oil companies taking their biggest short position in U.S. crude futures since the summer of 2007, according to CFTC data, in order to protect themselves against price falls.

Producer hedging has pressured longer-dated contracts, contributing to the narrower spread. In a Sunday note, Goldman Sachs said the hedging activity could cause the rally in those contracts to stall.

There is even a possibility of backwardation in the short term, where later-dated contracts are cheaper than near-term contracts, as the market moves into peak refining season, according to Barclays analyst Michael Cohen.

"We're of the view that the macro and oil specific factors will align to get us into a situation where prices go down at the end of summer. And then, come back up in line with seasonal trends," he said.

Goldman added that the fall in supply happened more quickly than expected, though they expect supply to rebound in 2017.

Hedge funds may play a role in the sustainability of the rally in crude if their appetite for commodities ebbs, taking with it the flow of cash.

Data from the CFTC shows hedge funds reduced bullish U.S. crude oil bets for a second straight week last week, driven by a one-third increase in short selling. Those funds still carry a notable long position in the market, however. [CFTC/]

Article Link to Reuters:

Here's How Hillary Clinton's Allies Plan To Go After Trump

"The fact of the matter is knowledge about Donald Trump is a mile wide and an inch deep," Guy Cecil says.

By Gabriel Debenedetti
May 17, 2016

The coming ad assault against Donald Trump from pro-Hillary Clinton super PAC Priorities USA Action is likely to drill a three-pronged message deep into the minds of swing state voters, if the group’s leaders have their way.

The three central tenets of the message will be that the real estate investor is a divisive character, that he’s too dangerous to vote for, and that he’s a con man, Priorities’ chief strategist Guy Cecil explained to POLITICO on Monday — two days before the organization started its run of television advertising that’s set to effectively stay on the air straight through Election Day in Colorado, Florida, Iowa, Nevada, New Hampshire, Ohio, and Virginia.

The effort is kicking off this week by educating swing-state voters about Trump.

“One of the biggest misconceptions about Donald Trump is [that he has] virtually universal name recognition, that voters are completely clued into this race, that they know Donald Trump, that they know about his career, that they’ve seen the more outrageous positions he’s taken. The fact of the matter is knowledge about Donald Trump is a mile wide and an inch deep. In fact, most Americans who have been busy living their lives, who have not been watching cable coverage, [know] very little about Donald Trump,” said Cecil, noting that the group has found that clips tend to prove most effective when voters see or hear the presumptive GOP nominee directly.

“They are more likely to know what contestants were on The Apprentice or that he owned Miss Universe than anything else, so we believe there is a lot more to do in order to make sure voters understand where he stands. And, in particular, as we’ve done our own research — focus groups — what comes out most immediately is that voters know virtually nothing outside of his entertainment career."

The group’s deluge of television-based attempts to define Trump, who outlasted 16 primary opponents, are kicking off to the tune of $96 million so far, alongside $35 million in reservations for digital efforts and $5 million for radio spots.

The first theme — that he’s too divisive — focuses on Trump’s harsh rhetoric reserved for distinct segments of the electorate: “women, Hispanics, Muslims, African-Americans,” almost all groups, said Cecil.

The second — that he’s too dangerous — takes a national security tack.

“I frankly don’t think ‘risky’ captures it, because ‘risk’ implies potential upside,” explained Cecil, mentioning clips that show Trump suggesting more countries should have nuclear weapons and insisting that he knows more than generals, also alluding to Trump’s recent barbs toward leaders in the United Kingdom. “We have a presidential candidate who is already getting into wars of words with our most important allies."

And the final prong, “that he has been basically pulling a con job on people,” will dive into his economic positions — like on trade, where he sounds a populist tone but has spoken of employing people in Bangladesh — and his own business record, including how he refused to release his tax returns.

Building its onslaught around the premise that Trump has not yet been properly introduced to target voters despite his ubiquity on cable television, the group expects to run multiple tracks of attack at once, targeting different groups of voters within the seven pinpointed states. So while the PAC will run television ads based around the three central prongs, Cecil explained, it will also be using its digital channels as part of its overall attempt to appeal to Millennials, Hispanics, and other key constituencies.

Priorities has been running focus groups and surveys in the seven states since February, testing appeals with groups of persuadable voters, Democratic voters, and infrequent voters. The group has also tested over 75 clips of Trump using online panels, helping it to pinpoint key moments of maximum impact.

And, in addition to its more straightforward testing, Priorities also tested a number of the Republican-funded anti-Trump super PAC ads that ran during the primary, recognizing that those spots were largely absent from major swing states, and that they were targeted to Republicans rather than independents or persuadable voters.

Article Link to Politico:

Here's How Hillary Clinton's Allies Plan To Go After Trump

Is Dilma Rousseff’s Impeachment Good For Brazil?

It may offer a chance for Brazil to return to the policies "that put the country on a virtuous trajectory of rising growth and falling inequality."

By Lee Alston
The New Republic
May 16, 2016

“Brazil’s young democracy is being subjected to a coup,” said Dilma Rousseff after the Senate on May 12 voted 55 to 22 to remove her as president and move forward with impeachment.

Is this really a coup, as Rousseff and her supporters believe? Coups usually entail the violent overthrow of a government or a trampling of constitutional rules and procedures. In Brazil, there has been no involvement by the military other than to keep the peace.

And the major players in this real-life Brazilian telenovela—Congress, the judiciary, the federal police, and the Federal Accounting Office (TCU)—are all playing by the constitutional rules. This is testimony to strong institutions in Brazil and a victory for checks and balances.

Far from being a coup, the current tumult, I believe, offers a chance for Brazil, with the right leadership, to return to the policies initiated in the mid-1990s that put the country on a virtuous trajectory of rising growth and falling inequality. The middle class expanded dramatically and the political system became more transparent.

Such policies first and foremost conform to monetary and fiscal orthodoxy but also promote social inclusion through programs such as the one that pays mothers to keep their children in school.

I call this economic model “fiscally sound social inclusion,” and it’s a topic my coauthors and I explore in our forthcoming book, Brazil in Transition: Beliefs, Leadership and Institutional Change. Such policies helped make Brazil one of the world’s largest and fastest-growing economies.

Can Brazil’s new leader, Vice President Michel Temer, use this window of opportunity to restore economic growth and also reduce inequality under the mantle of fiscally sound social inclusion?

How we got here

Prior to the reelection of President Rousseff in October 2014, two decades of economic and political development were beginning to founder on the shoals of a decline in commodity prices and a corruption scandal involving Petrobras, the state-owned oil company.

With the country’s economy in decline and the election drawing nearer, the president submitted rather rosy-looking public accounts to the TCU—basically a federal budget watchdog similar to the U.S. General Accounting Office but with the power to approve or reject them. Rousseff’s accounts suggested the government’s finances, although deteriorating, were not far off track.

But in a historic ruling following her narrow election victory, the TCU unanimously rejected the accounts, asserting that Rousseff understated the public deficit in the year prior to the election.

It is plausible, as her critics have argued, that Rousseff would not have won reelection had the voters known the true fiscal state of Brazil.

Although the impeachment trial technically entails prosecution for violating the fiscal responsibility law, in the eyes of the public, more is at stake, including the mismanagement of the economy and the corruption scandal at Petrobras, where Rousseff was board chair prior to her election.

Markets remain optimistic

Where does Brazil go from here?

Again, playing by the rules, former Vice President Temer, who belongs to a different party than Rousseff, is now the interim president while the impeachment prosecution proceeds. If Rousseff is impeached or resigns (never, she claims), Temer’s position will become permanent, and he will serve out her term, which expires in 2018.

Impeachments (and certainly coups) generally send economies into a tailspin. Yet, this hasn’t happened in Brazil. As the impeachment gained steam this year, the Brazilian real (the national currency) actually appreciated, as did the stock market.

Since the beginning of the year, the real is up by 10 percent and the stock market by 23 percent. And even when the real was tanking in late 2015, foreign direct investment surged, a sign of confidence by outside investors in the underlying fundamentals of the economy despite the political turmoil.

It may also signal confidence that Temer will institute market-friendly reforms. It’s important to note that in Brazil presidents have much stronger agenda-setting powers than in the U.S.

Temer is not popular in Brazil, but he is known as a “dealmaker,” one who is capable of managing a coalition in a multiparty Congress.

This all sounds promising, but before looking forward it is important to understand the past.

From military rule to fiscally sound social inclusion

From 1964 until 1985, Brazil was ruled by a military regime.

The military imposed order in its early years and embarked on an ambitious top-down development plan that turned Brazil into a “miracle economy” in the 1970s. However, growth began to sputter by the end of the decade, and inflation soared.

As growth weakened and the opposition became more vocal, the military’s oppressive reaction failed to suppress a growing populism, forcing it to pave the way for a return to democracy.

This helped usher in a new belief: social inclusion, which meant everything for everyone. The constitution of 1988 is one of the most detailed in the world, especially in terms of human rights. The decision-making process codified these beliefs around social inclusion as every interest group got to hang its ornament on the “Christmas tree” constitution.

Unfortunately, this didn’t work so well for the economy. From 1986 through 1993, governments spent generously on wasteful pork barrel projects, financed by printing money, leading to hyperinflation in the thousands of percent. Social inclusion was great in principle but bad in practice.

Several stabilization plans aimed at reining in inflation dramatically failed, and Brazil’s first democratically elected president since military rule, Fernando Collor,resigned during an impeachment trial in 1992.

This marked a turning point for Brazil and its economy after Fernando Henrique Cardoso, a self-exiled socialist during the military regime, was appointed finance minister by Collor’s replacement.

Cardoso and his team swiftly tamed inflation and instilled confidence, especially among businesses. This helped him win reelection, following which he passed the cornerstone of fiscally sound social inclusion: the fiscal responsibility law, aimed at ensuring that state governments could no longer spend more than their budgets allowed.

At the same time, Cardoso never abandoned the concept of social inclusion. Rather he merged it with his orthodox fiscal and monetary policies, such as keeping inflation in check, reforming pensions and controlling the budget. This led to modest economic growth and a growing middle class.

Yet his party lost the 2002 election to the charismatic Lula da Silva, who campaigned on a platform of largesse for the lower class and workers in general. Fortunately, high commodity prices helped da Silva run successive fiscal surpluses during his two terms, even as he expanded programs for the poor started by Cardoso. In other words, he continued and solidified a policy of fiscally sound social inclusion.

It was on da Silva’s crest of popularity and economic growth that Rousseff took the helm in 2010. But she abandoned many of his “fiscally sound” policies by increasing government expenditures and subsidies as well as expanding the role of state-run companies like Petrobras and the Brazilian Development Bank. And as commodity prices plunged, the economy fell with them, eventually exposing the holes in the government’s finances.

The traits of a leader

So the question now is will (and can) Temer restore those socially inclusive yet fiscally sound policies that put Brazil on course to becoming a truly developed country?

So far, foreign and domestic investors have reacted favorably. But Temer faces a difficult task in resurrecting trust amongst the population and investors. Meanwhile he also faces his own allegations of corruption.

To me, whether he can successfully navigate the ongoing bumps in the road and stay the course of reform or not depends on whether he has the necessary attributes of a leader to rise to the occasion.

In “Brazil in Transition,” my coauthors and I pose three questions to help us assess whether a leader such as Temer has what it takes: does he know what policies are needed to recover from the shock? Can he coordinate a coalition that includes economic and political actors as well as citizens to embrace those policies? And is he trusted and does he possess moral authority?

To this, I add two more: can he adapt to unforeseen bumps to stay the course? Does Temer (including his policy team) possess imagination to see solutions that were not on the table?

Temer has recognized the heart of Brazil’s dilemma: policies need to be fiscally sound. This means accepting some austerity, as Argentina recently did. On this score he wins points for naming Henrique Meirelles, a well-respected former head of the central bank and a Wall Street veteran, as finance minister.

Can Temer coordinate among Congress and other powerful players in Brazil, such as industry and unions, and convince them to play ball? Being known as “the dealmaker” means he should be able to “coordinate and adapt” as opportunities arise. Temer was also trained as a constitutional lawyer, which means he knows well both the law and rules of the game in Congress.

However, he lacks the moral authority of both Cardoso, who was a vocal critic of the military regime, and da Silva, who with a fourth-grade education rose to the presidency as a strident union leader. But leaders can build moral authority; they need not come to the job with it in hand. (Not everyone can be a Nelson Mandela.)

Finally, does Temer have the “imagination” to come up with extraordinary ideas capable of breaking through the gridlock and bringing about reform? In his first hours in office, he demonstrated imagination by cutting his cabinet by a third, to 22 from 31, and, controversially, he picked only white men. This move could backfire, but it at least shows he’s willing to take risks and is not afraid of some controversy.

So does this suggest he has the “right stuff” to seize the window of opportunity of a new government and return Brazil to its virtuous trajectory?

His early moves may please markets, but to satisfy Brazil’s diverse citizenry, he will need to demonstrate that he is not abandoning social inclusion. On this as well as his own fate in the ongoing corruption scandals: the jury is still out.

Article Link to the New Republic:

Is Dilma Rousseff’s Impeachment Good for Brazil?

Obama’s Opportunity in Venezuela

By Noah Rothman
May 17, 2016

The so-called Bolivarian Republic of Venezuela has been on life support since Hugo Chavez was taken off it. The ugly, prolonged death of the “Bolivarian Revolution” hasn’t been a pretty thing to watch, but nor does the West seem all that interested in hastening the inevitable. Perhaps the White House shares the view of Chavez’s successor, Nicolas Maduro, that the United States is still more part of the problem than it is the solution to the region’s ills.

America’s sophisticated foreign policy establishment has an unattractive habit of taking the claims of scapegoating Latin American caudillos at their word. Views like those of TIMEMagazine’s Karl Vick, who in March of 2015 wrote that Obama’s unilateral thaw in relations with Cuba has helped to isolate Maduro’s hardline leftist regime, rarely go challenged by fellow sophisticates in the foreign affairs circuit. That view was published just days after the president formally dubbed the Venezuelan government a threat to American national security – a prerequisite for issuing a set of narrow sanctions targeting seven government officials in Caracas. This was a half measure and one that came many months too late.

In February of 2014, violent protests erupted across the country. Following the death of their generalissimo, demonstrators demanded the “resurrection of democracy” in Venezuela and the resignation of Maduro and his government. They were gunned down in the streets. On the anniversary of that spasm of liberalism in one of South America’s most illiberal nations, violence again exploded onto the streets. This time, the bloodshed was intense, and the level of revolutionary sentiment held more promise than did the demonstrations of 2014. The conditions these demonstrators were protesting were worse, too. A collapse in oil prices had crippled the nation’s command economy. Crime rates were ballooning, and government cooperation with the cartels had grown overt. Shortages and corruption became the intolerable norm. Once again, thousands took to the streets. Once again, they were ruthlessly slaughtered.

There has been no recovery in Venezuela, and the nation is again teetering on the brink. Last year, the Venezuelan economy contracted by nearly six percent. The official inflation rate is near 180 percent, but the real rate of inflation is surely many times that. Food and medical shortages have reached intolerable levels, and the images of average Venezuelans rioting on the streets, looting shops, and hijacking food trucks have begun to trickle out of the country on social media venues. “Gloves and soap have vanished from some hospitals,” the New York Times reported. “Often, cancer medicines are found only on the black market. There is so little electricity that the government works only two days a week to save what energy is left.” This heart-wrenching dispatch revealed that deaths among newborns and mothers in hospital have spiked dramatically over the last four years.

Over the weekend, pro-and anti-government protesters began assembling again on the streets of Venezuela after Maduro declared a 60-day state of emergency. Maduro insisted that opposition forces were “orchestrating foreign military intervention in Venezuela.” The stage is set for more bloodshed in the Bolivarian state.

American officials are not entirely silent about the crisis in Venezuela. Huddling with reporters in Washington, some unnamed U.S. officials warned that Maduro might not be in power for much longer. “The ice is cracking,” one unnamed U.S. official told Reuters reporters. “You know there’s a crisis coming.” Reuters reported that protests might spiral out of control or that the Venezuelan president could be removed by the military. Maduro, too, seems aware of just how precarious his position is. Last week, German Mavare, leader of the opposition UNT Party, was shot in the head and killed in the Venezuelan state of Lara. “A red bullet ended his life,” mournedopposition lawmaker Luis Florido.

Maduro has followed the banana republic playbook to the letter amid this latest outbreak of unrest. He blamed the United States for virtually all of his country’s woes – from its economic crisis, to consumer goods shortages, to the looting of supermarkets, to the price of oil, to even the ouster of former Brazilian President Dilma Rousseff following her impeachment. President Barack Obama appears to want to avoid to be seen as lending credence to any of these conspiratorial ravings. “The administration of President Barack Obama wants ‘regional’ efforts to help keep the country from sliding into chaos,” read the Reuters dispatch. The definition of insanity.

While American officials are content to work behind the scenes, Beijing is taking a front-and-center approach to stabilizing the region. China, which has already lent Venezuela approximately $50 billion over the last decade reportedly, recently agreed to a deal to ease the country’s burdensome debt payments. “This will give the country important oxygen to go forward,” said Venezuela’s Economy Vice President Miguel Perez. While China is giving the regime in Caracas all the “oxygen” it needs to lumber along and possibly extricate itself from yet another domestic crisis, why doesn’t Washington suck some of that precious O2 out of the room? What is stopping the president from stating clearly and unequivocally that socialism along the “Bolivarian” model is an irreparable disaster and thereby give democratic elements in the country some sign that the United States welcomes regime change in Venezuela?

The answer is likely that he has already sacrificed his credibility as chief spokesman for the American capitalist model. “You know, you’re a capitalist Yankee dog, or you’re some crazy communist that’s gonna take away everybody’s property,” Obama said dismissively in March to a town hall full of young Argentineans. “And those are interesting intellectual arguments, but I think for your generation you should be practical and just choose from what works.” These are hardly quaint, anachronistic “intellectual arguments” in Venezuela. By shrugging his shoulders and drawing a value judgment-free moral equivalence between murderous socialism and free market capitalism as just two competing systems, Obama folded his best hand.

Rarely do presidents get three chances to make the same mistake. Instead of spending his final months in office touring the world’s few remaining communist nations and issuing oblique mea culpas for the Cold War-era policies of his predecessors, he could at least briefly reaffirm why it was the West that won that conflict. The Warsaw Pact didn’t collapse because NATO-led armored columns surged across Checkpoint Charlie. The Soviet Empire dissolved amid an explosion of righteous outrage by the long-suffering peoples of the Eastern Bloc’s tyrannies. The people of Venezuela are crying out, too. Obama seems content to pretend he doesn’t hear them.

Article Link to Commentary:

The New York Times’ Empty Trump ‘Exposé’

By Post Editorial Board
The New York Post
May 16, 2016 

It didn’t take long at all for that New York Times front-page “exposé” of Donald Trump’s treatment of women to start falling apart.

The Sunday article opened with a 25-year-old anecdote about Rowanne Brewer Lane. By Monday, she was ripping the Times for distorting what she’d said.

“He never made me feel like I was being demeaned in any way,” Lane told Fox News. “He never offended me in any way. He was very gracious.”

Yet the Times’ Michael Barbaro and Megan Twohey described the former model’s first meeting with Trump, during which he offered her the use of a swimsuit at his Florida estate, as “debasing” — a word she never used — and somehow a window on his “private treatment” of women.

Lane says the Times reporters told her “several times . . . that it would not be a hit piece.” But that’s exactly what it was.

A microscopic search of Trump’s private life over decades revealed that he likes beautiful women. Not much to set against his strong record of promoting women in an industry that’s still male-dominated.

Far, far worse has been said for more than two decades about Bill Clinton. But the Times has never seemed much interested in his private life or character. Especially not when he was running for president.

But the self-styled paper of record will bend over backward to smear a Republican candidate.

In 2008, just days after locking up the GOP nomination, John McCain got hit by a 3,200-word Times story suggesting he may have had an “inappropriate relationship” with a female lobbyist.

Both parties denied it — and the Times found no one to confirm that anything untoward had happened. Later, the paper’s public editor said flat-out that the Times was “wrong” and owed its readers “more proof” than it was “able to provide.”

So honest readers will see this latest exposé for what it is: a blatantly partisan — and blatantly unfair — hit job.

By the way, the Times’ star witness, the “debased” Rowanne Brewer Lane? She says she’s voting for Trump.

Article Link to the New York Post:

Black Republicans: The RNC Gave Up On Us

The RNC had pledged to make outreach to black voters a priority. But as staff dedicated to the effort quit, the committee has been slow to replace them, causing black Republicans to question their commitment to the effort.

By Betsy Woodruff
The Daily Beast
May 17, 2016

If Republicans want to grow their support with black voters in 2016, they might want to start internally.

Over the past few months, all the D.C. members of its black outreach team quit. And the committee only hired one person , a Republican communications consultant who is only committed through November, to take their place.

Black Republican leaders are miffed, and say the RNC hasn’t delivered on its commitment to invest in outreach to black voters.

Some say it’s part of a decades-long pattern in the GOP’s party leadership: lose races, promise to court black voters, not follow up on those promises, and lose races some more.

After getting walloped in the 2012 general election, the RNC commissioned a study—called the Growth and Opportunity Project and promptly nicknamed the RNC autopsy—to investigate how the party could do better with sectors of the population where it underperformed. One focus of the report was black voters.

“[T]he Republican Party must be committed to building a lasting relationship within the African American community year-round, based on mutual respect and with a spirit of caring,” the report read.

In the time since then, the RNC built a small team of full-time black outreach staffers. But over the past few months, four high-level African-American staffers have left—three from the black outreach team and a fourth from the communications shop.

None of the staffers who resigned provided on-the-record comment about their decisions to move on. Turnover at party campaign committees is common, and losing four staffers isn’t inherently shocking.

That said, the exodus raised eyebrows because the staffers weren’t replaced; instead, the RNC brought on Telly Lovelace, who has said he will leave the committee after the election.

Leading black conservatives who spoke with The Daily Beast had nothing but good things to say about Lovelace—but added that he’s being expected to do the work of large team.

But the committee’s failure to re-staff its outreach team hasn’t inspired much confidence that the party as a whole will invest in courting black voters.

“Orlando Watson and Raffi Williams are two fine gentlemen,” said Ron Christie, a board member of the American Conservative Union, of two African-American staffers who recently left the RNC. “The fact that both of them are gone and that they were hired in the wake of recognition that we need to do better as a party is somewhat troubling to me.”

“It does concern me,” he added.

Henry Childs, the president of the Black Republican Auxiliary for the Texas Republican Party, said he found the RNC’s shrinking black outreach staff deeply unfortunate.

“I was very disappointed in the execution on the black outreach,” he said. “I always look at the money. You’ll know when a campaign or a party is interested when they spend money on an effort, so I look at money and staffers, and as far as I’m concerned, they didn’t invest enough money and they did not hire enough staffers to get the job done.”

“It’s cyclical that you hear that,” he added. “They’re going to do something different, they’re going to try to talk to blacks, women, young people. Every time we lose an election, we talk about what we’re going to do differently, then we don’t do it.”

And he doesn’t take heart from the fact that there’s one person doing full-time black outreach from RNC headquarters in D.C.

“It’s laughable,” he said. “It really is laughable. It is laughable.”

Childs said a serious black outreach effort would require at least one RNC staffer work on it full-time in each state.

Lovelace said the RNC has 7 full-time black outreach staffers operating in different battleground states, including two in Ohio. And he said he is working to develop relationships between the RNC and media outlets with predominantly black audiences.

“There’s a whole demographic there that is kind of untapped, and we need to start going after their audience,” he said.

And he said the loss of the staffers didn’t mean the RNC had given up on the black vote.

“This is Chairman Priebus’ agenda, and Chairman Priebus is still here and we’re pushing forward,” he said.

Kirsten Kukowski, the communications director for the RNC, said the committee is working to direct convention funds to minority-owned businesses. The convention is in Cleveland, and 2010 census data shows that more than half of the city’s residents are black.

One of the event’s official florists is a minority-owned business, she noted, and said the RNC is trying to highlight minority-owned small businesses as it does publicity for the event.

That said, Sean Jackson, who heads the Black Republican Caucus of Florida, shared Childs’ concerns that the RNC’s tiny black outreach indicated it wasn’t making the necessary investments to reach out to black voters.

“The RNC does not have a vested interest in black America,” he said.

“I don’t say that in a malicious or degrading or vindictive manner, I don’t mean that at all,” he added. “It has been part of the norm—normal culture for so many years, of not engaging the black community, that that engagement continues to remain nonexist.”

Until the RNC is willing to make a number of hires and invest serious finances in reaching out to black voters, he added, nobody should take their overtures to the contrary seriously.

“Black outreach takes money just like outreach for any other commty does,” Jackson said, “and of all of the funds and resources that are spent by the RNC, very few to minimal to nothing is spent in the black community.”

Nobody expects Republicans to do particularly well with black voters. But several gubernatorial candidates cracked double digits with them in 2014, including Chris Christie and John Kasich. George W. Bush won 11 percent of the black vote in 2004, two percentage points better than he did in 2000. Mitt Romney, meanwhile, only won 6 percent of black votes in 2012. Ohio and Florida, both must-win swing states in presidential years, have sizable black populations, and increasing their support for Republicans by small margins could have an outsize impact.

Crystal Wright, a conservative communications consultant who worked with the RNC during the 2012 to build a website to reach out to black voters (a project the committee eventually scuttled), said she thinks the committee’s outreach efforts have never been serious.

“People go over there they’re used as props, and the RNC—they’re not committed to any kind of outreach,” she said, referring to African-American staffers. “Trump and Paul Ryan are doing more to talk with black voters than the RNC ever will, in my opinion.”

“There’s just no seriousness coming out of the RNC to grow the Republican Party tent beyond white voters,” she added.

But Leah Wright Rigueur, a public policy professor at the Harvard Kennedy School of Government who studies the relationship between African-American voters and the GOP, said the party has a long-term habit of planning to reach out to black voters and then not following through. The fact that Lovelace is on his own at RNC headquarters, she added, indicates that things may not have changed in a substantial way.

“The task in front of him is monumental,” she said. “There is absolutely no way that one person can do it.”

“In almost every presidential election since 1964, Republicans know what they have to do in order to get black voters but they are unwilling to do it,” she added.

As presidential elections near, she added, the party shifts its focus from outreach to African-Americans and other people of color to increasing turnout among its white rural and suburban base voters.

“The idea of either continuing that outreach or doing very strong targeted outreach is cast aside because they fear is that it will alienate the base of the party, the people who consistently vote,” she said.

In 2012, for instance, then-vice presidential contender Paul Ryan wanted to campaign in inner cities, pitching predominantly black communities on conservative policies. But the Romney team vetoed his idea—and went on to do abysmally with black voters.

Every time Republicans promise to reach out to black voters but fail to follow through, Rigueur added, it makes their next effort event harder.

“While Republican politicians may not remember, minority voters do remember,” she said. “They say, this is just like last time.”

Article Link to the Daily Beast:

Is A Clinton-Warren Ticket A Dream Or A Nightmare?

The chatter has begun about nominating Elizabeth Warren for vice president on the ticket with Hillary, and it is a proposition with no easy answers and several tough questions to sort out.

By Michael Tomasky
The Daily Beast
May 17, 2016

The Elizabeth Warren veep talk heated up last week. Warren went on an anti-Trump Twitter tear that could reasonably be viewed as a kind of audition for the role of veep-candidate attack dog. HuffPo’s Sam Stein wrote last Thursday that some Hillary Clinton campaign folks “took note of the senator’s ability to rile the real estate tycoon.” Pivoting off that piece, Slate’s Michelle Goldberg endorsed a Clinton-Warren ticket last Friday.

I have some thoughts of my own on this, having first speculated about a Clinton-Warren ticket way back in March 2015. I see obvious upsides—and equally obvious potential downsides. So let’s just separate this column out into five parts and fly briskly through them.

Part Number One: Forget the old saw about the vice presidency being useless. The standard old saying is from an FDR vice president who said the office wasn’t worth “a bucket of warm spit,” although he probably actually said “shit,” which I’m allowed to say in The Daily Beast in such a context, so I’ll say it.

It was true then, but it ain’t true now and hasn’t been for 20 years. Today the presidency is a huge, sprawling corporation. The Potus is the CEO. But the vice president is like the COO—not the boss, but plenty of power. Al Gore and Joe Biden have both had broad issue portfolios of their own and were involved in every single truly important decision in their administrations that I know of. And as for Dick Cheney, well, I don’t think anyone doubts his influence.

So, to all these liberals who howl, “No, Elizabeth, stay in the Senate, you have much more power there!”—maybe. But if she and Clinton were able to work out clearly understood lines of authority and Warren operated deftly within them, she’d have far more power as vice president. Not even close.

Part Number Two: Why Clinton-Warren could be a dream ticket. Easy: Because it would unify the party and galvanize liberals. My guess? The day Clinton names Warren, she gets a five-point bounce that never goes away.

Also: It’s gutsy. Gutsy is a quality for which Clinton is not known. It’s outside-the-box-y, like Bill Clinton choosing Gore. Two women—what an eff-you to the over-testosteroned little man-boy on the other side. It would draw such stark contrasts.

But here’s more. Sam Stein, in the piece linked to above, spoke with Democratic pollster Peter Hart, who conducted some focus groups of independents and Republicans in Colorado last year. They didn’t know a lot about Warren, but what they said was enthusiastic. I could totally see this, maybe not with Republicans, but with independents—if you’re a middle- or working-class person with bills to pay and worries about how to meet them, she’s talking to you. So Warren may have appeal beyond liberals that the Beltway will never recognize.

Part Number Three:
Why a Clinton-Warren ticket could be trouble. First of all, this two women business. It would energize a thunderous women’s vote. But how many men who might otherwise vote for a Clinton-Generic Democratic Male ticket would be lost? It’s hard to say. I tend to think not as many as the number of women who’d be gained, but my female pundit friends tell me that latent sexism even among men who consider themselves to be relatively enlightened should not be sold short, and I reckon they know more about this topic than I do.

Another problem: While Warren may have surprising appeal among moderate voters, one place I’m quite confident she does not possess surprising appeal is in the business-corporate world. Lots of these people are horrified by Trump; as I wrote recently, Clintoncould pick a number of them off. But that’s not likely to happen if she selects Warren. In fact, it could move those types very firmly into Trump’s corner. Of course, they were firmly in Mitt Romney’s corner, and it didn’t do him much good.

Part Number Four:
Why a Clinton-Warren governing team could work great. Warren would open the bidding on such a ticket by saying, “I’m not going to be window dressing here. I have a national constituency that expects certain things of me, and I will join you only if you commit to doing several of those things.”

Like? No, not break up the big banks. Clinton won’t go beyond what she’s said there (which is actually reasonably aggressive, though not by Warren-Sanders standards). However: a say over key appointments, from Treasury secretary to positions like head of the Consumer Products Safety Commission to members of the Federal Election Commission on down to positions that never make the news but whose occupants make decisions every day that affect thousands of people. And a big project of her own to oversee, like the home-mortgage refinancing plan.

I’m sure Warren would want more—a say in all major economic decisions. Which of course she should have. But—only a say. If the president concludes against the veep’s advice, the veep still has to be a team player about it. They will inevitably come to loggerheads at this point or that, and the media will eat it up because, you know, cat-fight, etc.; so the two of them will need to be particularly mature people about this.

Part Number Five: Why a Clinton-Warren governing team could be a disaster. Because, like, the two of them won’t be able to be particularly mature adults about this.

I’d say on balance more plusses than minuses. But I think I know how Clinton thinks. The first thing she’s going to think is the responsible thing, i.e., would I be comfortable making this person the president should something happen to me? And because of Warren’s near-complete lack of interest in foreign policy, Clinton may well answer that question no.

So my current guess? This won’t happen. Which is too bad. It’d be reaalllly interesting to see how our country would handle this reality. And to see how unhinged it could make Trump. Picture that, will you…

Article Link to the Daily Beast: