Wednesday, June 8, 2016

Wednesday, June 8, Night Wall Street Roundup: Dow Finishes Back Above 18,000 As Dollar Dips

By Caroline Valetkevitch
Reuters
June 8, 2016

The Dow ended above 18,000 for the first time since April on Wednesday as declines in the dollar lifted some commodity-related shares and boosted the outlook for multinationals.

The S&P 500 materials index .SPLRCM climbed 0.6 percent following gains in copper and gold prices. Energy shares were .SPNY lower despite a jump in oil prices.

The benchmark S&P 500, up for a third straight session, is now about 12 points shy of its all-time closing high of 2,130.82.

Helping sentiment was a weaker dollar, which tends to benefit U.S. multinationals that derive a large portion of their sales from overseas. The S&P industrials index .SPLRCI rose 0.7 percent, the day's best-performing S&P index.

"The weaker dollar and strength in commodity names is certainly helping to fuel the market's strength," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles. "Multinational companies are all benefiting and helping to drag the market higher."

The dollar .DXY fell to a five-week low against a basket of currencies as traders reduced bets of an imminent U.S. interest rate increase.

The Dow Jones industrial average .DJI rose 66.77 points, or 0.37 percent, to 18,005.05, closing above 18,000 for the first time since April 27.

The S&P 500 .SPX gained 6.99 points, or 0.33 percent, to 2,119.12, while the Nasdaq Composite .IXIC added 12.89 points, or 0.26 percent, to 4,974.64.

With the S&P so close to its highs, "I do think the level around 2,130 ... is going to provide some psychological resistance in the market, and you may see a little pause there," James said.

Federal Reserve officials meet next Tuesday and Wednesday, and the U.S. central bank is expected to leave rates unchanged. Despite surprisingly weak monthly jobs data last Friday, Fed Chair Janet Yellen boosted sentiment Monday by painting a mostly upbeat picture of the economy.

Bucking the recent trend in retail stocks, Lululemon Athletica Inc (LULU.O) shares rose 4.9 percent to $71.48 after first-quarter sales beat analyst expectations.

Among the day's decliners, shares of VeriFone Systems (PAY.N) fell 24.7 percent to $21.27, a day after announcing lower-than-expected earnings and said it intends to reduce headcount and conduct a strategic review to address underperforming businesses.

About 6.5 billion shares changed hands on U.S. exchanges, below the 6.8 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Advancing issues outnumbered declining ones on the NYSE by 2,034 to 981, for a 2.07-to-1 ratio on the upside; on the Nasdaq, 1,844 issues rose and 980 fell for a 1.88-to-1 ratio favoring advancers.

The S&P 500 posted 53 new 52-week highs and no new lows; the Nasdaq recorded 106 new highs and 24 new lows.

Did #NeverTrump Have To Happen?

The GOP lies fractured over Trump’s candidacy — but it didn’t have to be this way.


By Dan McLaughlin 
The National Review
June 8, 2016

One of the questions that has hung in the air since Donald Trump effectively clinched the GOP nomination a month ago is whether the #NeverTrump movement — the large-scale rupture between the Republican nominee and, at a minimum, a large swath of the conservative movement — was an inevitable result of a Trump nomination. I think it was not — at least, not inevitable simply due to Trump’s record before running. Trump brought this on himself — and is still doing so. If a lingering conservative resistance to Trump was inevitable, it’s only because this is who Trump is.

Let’s think back to an alternative universe where Trump approached his campaign differently. Donald Trump is not a stupid man, and he clearly put some thought into certain aspects of his presidential run. For example, in 2014 he read — or at least claimed to read — Rick Santorum’s book Blue Collar Conservatives, and cited it to Santorum at the time as inspiration for the working-class focused message he would go on to make the centerpiece of his campaign. While that message was in line with some of Trump’s prior inclinations (he had been blasting foreign trade, especially with Asia, for a quarter century), it is clear that Trump’s focus on working-class voters is not accidental.

Now imagine what would have happened if Trump had looked at conservative and Republican voters and the ideas, platforms, and goals that have motivated them across the country — in races from the local to the national — over the past several decades, with an eye toward making himselfminimally acceptable to most conservatives. Imagine that he had sat down with major GOP foreign-policy hands, whether or not he agreed with them, and spent time studying up on national-security issues. Imagine if he had spent even a few days looking into the constitutional issues of great import to conservatives, and had hired some responsible people to develop a message about the federal judiciary. Imagine if he had informed himself about the Republican legislative proposals kicking around Capitol Hill, at least enough to identify a few he supported.

Then imagine a Trump campaign that was still the Trump campaign, but one that was harder for conservatives to dismiss. So “yes” to the trade demagoguery, the Mexican border wall, the insults at rivals, the trucker hats, the bashing of entitlement reform, and a lot of the Trumpian theatrics. But alongside the sizzle, some steak as well: concrete and consistent pledges to work with conservatives on key issues, seriousness on foreign affairs, a health-care plan he could describe in more detail than just “lines around the states,” and a sustained effort to convince voters that he was genuinely converted to advancing the pro-life cause and overturning Roe v. Wade. And just as important, no unforced errors: No defending Planned Parenthood and promising not to overturn the abortion laws, no praising single-payer health care and Obamacare mandates, no throwing his own tax-cut plan under the bus, no blaming George Bush for 9/11.

In short, imagine a Trump campaign that was noisy and rude and Trump-ish, but also fundamentally responsible, in the sense that behind the bluster, the candidate knows what he’s talking about, and knows how to demonstrate on a consistent daily basis that he understands what conservatives want and wishes to deliver some of it to them.

Would conservative writers, activists, and leaders have flocked to Trump in the primary? Would he have rolled up a lot more mainstream endorsements? No, probably not. I can’t see myself, or a lot of others, choosing to pass over a lot of candidates with real records of accomplishment and principle in favor of a political amateur with a ton of baggage and a longer record of supporting liberals than of doing anything at all for conservative causes. So yes, conservative opposition to Trump in the primary was surely inevitable, just as it was for Mitt Romney and John McCain and Bob Dole.

Right now, the major conservative argument for Trump is instrumental: Not that Trump would be a good president, but that Hillary would be against us on everything — whereas Trump is a wild card who would probably support at least some of the conservative legislative agenda coming from congressional Republicans, and appoint at least a few judges and executive-branch officials who would be good conservatives, and reject tying the U.S. to transnational progressive causes and agreements. Trump would be half a loaf, while Hillary would give us nothing.

It’s a seductive argument for a party out of power eight years, and if the president’s sole job was signing things sent to him by Congress, I might well swallow hard and buy the risk, much as I did in backing Romney. But a huge amount of the president’s job is national security and running the executive branch and appointing judges, tasks in which he takes the initiative rather than receiving proposals from the Hill. And even in Congress, it’s easy for Republicans to slide away from conservative principles when the White House is pulling them away rather than pushing them. Trump’s first congressional primary endorsement (who went down to defeat at the hands of grassroots conservatives last night) shows how little interest he has in the types of policies the GOP Congress supports, so long as it supports him personally.

The instrumental case depends on trusting that Trump would put in the effort to be something like a responsible commander-in-chief, and to pay attention to the merits of judges and legislation, and to at least draw some minimal lines he would not cross and spite conservatism, when he has spent his whole primary campaign doing the opposite at the precise moment when the system presents the strongest incentives to appeal to conservatives. If Trump never cared to figure out how to sound like a pro-lifer while running in a GOP primary, why would we expect better in the White House? The presidency, unlike the Supreme Court, is not an intellectual job, but it is not really possible to do the job if you lack even the basic intellectual rigor to learn what the office entails and decide what you would want to do with it.

This week’s flap, with Judge Curiel and the Trump University lawsuit, relates to a different aspect of Trump’s irresponsibility, his incessant race-baiting — and worse, demagoguery done in service of his own personal causes rather than anything that could arguably construed as an interest of the Republican party or the conservative movement. It’s a stance that further undermines the instrumental argument for trusting Trump to appoint good judges, as well as reminding those on the fence of the perils of being associated with Trump.

Mitt Romney, for all the apostasies in his record, made a point over his two campaigns of courting conservatives by doing precisely the things I’ve outlined here: studying the issues, being knowledgeable and responsible, remaining relatively consistent within his national campaigns. Romney never won the hearts or the trust of a lot of conservatives, but he made it hard to justify opposing him when the alternative was reelecting Barack Obama. Trump has seemed determined from the outset to make it easy — just ask yourself when was the last time we had a week’s news cycle (even a day is rare) when Trump didn’t offer more reasons for conservatives to feel justified in opposing him as a matter of both policy and politics. In some ways, the dynamic reminds me of the descent from Bill Clinton (who was always looking to co-opt the center, stealing Republican issues and themes and peeling off Republican votes) to Obama, who from the very beginning of his presidency has always made it easier for Republicans to oppose him than to work with him, by always offering a poison pill that made any deals intolerable to swallow. Temptation is easier to resist when it offers you nothing you want in exchange for accepting what you fear or despise.

The theory of Donald Trump — a rough-edged businessman-entertainer with no political experience who takes some populist detours away from conservative orthodoxy — is not the most appealing one for conservatives, but it’s not one we would necessarily reject out of hand when the alternative is Hillary Clinton. But that idea has not been the reality for the past twelve months, and there’s no reason to expect a change after his 70th birthday in a few weeks. Trump could have put in the effort to convince us that we would gain some policy and political rewards, and be able to trust him as commander-in-chief and head of the executive branch, if we supported him. He could have convinced us that he was, while not one of us, a man we could do business with. Trump’s inability or unwillingness to even fake it convincingly makes him a poor tempter indeed.


Article Link to The National Review:

Wednesday, June 8, Morning Global Market Roundup: Asian Shares Return To Gains As Markets Digest China Trade Data

By Nichola Saminather and Hideyuki Sano
Reuters
June 8, 2016

Asian shares edged up on Wednesday, as markets digested Chinese trade data against the backdrop of a brightening energy sector outlook and an expected delay in interest rate hikes by the U.S. Federal Reserve.

European markets though were poised for a subdued start, with financial spreadbetters expecting Britain's FTSE 100 and France's CAC to open down 0.2 percent, and Germany's DAX to start the day 0.3 percent lower.

The MSCI's broadest index of Asia-Pacific shares outside Japan erased earlier losses to climb 0.2 percent, as investors weighed May Chinese imports that beat predictions against worse-than-expected exports. The Asia ex-Japan index remained near the six-week high hit on Tuesday.

Japan's Nikkei also staged a turnaround, rising 0.6 percent.

"Global equities are firmer, but it is not indicative of an uptake in risk appetite," Bernard Aw, market strategist at IG, wrote in a note. "The upmove was mostly driven by higher oil prices."

China's CSI 300 and the Shanghai Composite indices both pared earlier losses, but remained lower. The CSI 300 was down about 0.4 percent and the Shanghai Composite fell 0.3 percent in thin trading, ahead of market closures on Thursday and Friday for the Dragon Boat weekend holiday.

Hong Kong's Hang Seng slid 0.3 percent. Hong Kong is also closed on Thursday.

Chinese dollar-denominated exports declined 4.1 percent in May from a year earlier, compared with an expected drop of 3.6 percent. Imports fell 0.4 percent, less than the predicted 6 percent, and the smallest decline since they turned negative in November 2014. China's trade surplus is forecast to hit $50 billion in May. [ECONCN]

Despite the weak exports, the Chinese central bank said on Wednesday it still expects the economy to grow by 6.8 percent this year.

On Wall Street, the U.S. S&P 500 Index rose 0.1 percent to 2,112 overnight, less than 20 points away from its record closing high marked in May last year.

The advance was led by 2.1 percent gains in energy shares as oil prices jumped more than 1 percent to hit eight-month highs on expectations of domestic stockpile draws and worries about supply shortfalls from attacks on Nigeria's oil industry.

A report from trade group American Petroleum Institute (API), released after Tuesday's close showed a crude draw of 3.6 million barrels, larger than expectations of 2.7 million barrels, supporting the market.

U.S. crude futures rose 0.1 percent to $50.50 per barrel. Global benchmark Brent futures also gained 0.1 percent to $51.51.

Both remained close to the highest level since October, seen earlier in the session.

Investors further trimmed expectations of Fed rate hikes as they assessed Friday's employment report that showed new hires sharply dropped in May.

Data published on Tuesday confirmed U.S. nonfarm productivity fell in the first quarter on a surge in labour-related costs, suggesting companies may have had to slow hiring after their hiring earlier this year outpaced revenue growth.

The 10-year U.S. Treasuries yield was last at 1.7125, testing strong support at around 1.70 percent.

In Europe, German bond yields hit a record low of 0.045 percent on Tuesday as investors sought a safe haven ahead of Britain's referendum on EU membership.

The British pound was off Monday's three-week low but remained volatile. It traded at $1.4555 , compared with Monday's low of $1.4352.

The dollar also licked its wounds near four-week lows after the job data quashed expectations of a Fed rate hike in the next couple of months.

The dollar index stood at 93.694, the lowest level in almost a month.

The euro advanced 0.2 percent to $1.13730 while the yen rose 0.3 percent to 107.030 per dollar.

The dollar's weakness proved a boon for gold, which hit a two-week high of $1,249.20 an ounce on Wednesday. Spot gold was last trading up 0.3 percent at 1,247.30.

Oil Hits Eight-Month Highs On U.S. Inventory Draw, China Imports

By Osamu Tsukimori
Reuters
June 8, 2016

Oil prices rose for a third day to hit their highest in about eight months on Wednesday, boosted by industry data showing a larger-than-expected drawdown in U.S. crude inventories, worries about attacks on Nigeria's oil industry and strong Chinese demand for oil.

London Brent crude for August delivery was up 2 cents at $51.46 a barrel by 0652 GMT, after settling up 89 cents on Tuesday. It earlier touched $51.57, the highest since Oct. 12.

NYMEX crude for July delivery climbed 9 cents to $50.45 a barrel, after touching $50.58 earlier, the strongest since Oct. 9.

U.S. commercial crude inventories fell by 3.6 million barrels last week, data from industry group the American Petroleum Institute showed on Tuesday after market settlement, compared with expectations for a 2.7-million barrel draw according to a revised Reuters poll. [API/S] [EIA/S]

The U.S. Energy Information Administration (EIA) will issue official inventory numbers at 1430 GMT on Wednesday.

Chinese trade data showed on Wednesday that its crude oil imports rose 38.7 percent in May from a year ago - the biggest jump in more than six years - and added to hopes that the economy of the world's second-largest oil user may be stabilising.

"Overall, China's economic activity is not slowing down as much as expected, which is a support to the market," said Kaname Gokon at brokerage Okato Shoji.

Worries about global supply disruptions and expectations for oil market rebalancing also supported the market.

The southern Delta swamps in Nigeria have been hit by militant attacks on pipelines which have brought its oil output to a 20-year low, and the government said to scale down a military campaign and talk to the militant group.

Takayuki Nogami, senior economist at Japan Oil, Gas and Metals National Corp (JOGMEC), said the start of the summer gasoline demand season, supply disruptions in Nigeria and Canada and a weak dollar because of a possible delay in the timing of a U.S. interest rate hike helped push up the market.

"The Nigerian militants have pledged to continue attacks until production becomes zero, so there are worries over a further slump in output," he said.

Still, concerns about global oil demand remained. The World Bank slashed its 2016 global growth forecast on Wednesday to 2.4 percent, while China's central bank stuck to its growth forecast of 6.8 percent this year.

The market was little changed after Reuters reported North Korea has restarted production of plutonium fuel in defiance of international sanctions.

If You Want Economic Growth, Pick The Candidate Who’s Actually Created Jobs

By Betsy McCaughey
The New York Post
June 8, 2016

President Obama’s top banker Janet Yellen gave a somber assessment of the current job market this week, throwing cold water on the president’s election-year message that voters should elect a Democrat to the White House again.

Obama’s been bragging that America has “the strongest” economy in the world. And pigs can fly.

Growth under Obama has averaged a stagnant 1.7 percent a year. Meanwhile, Ireland is growing at nearly 8 percent, India at 7 percent, Sweden at 4 percent.

The Obama economy is embarrassing compared to those countries — and compared to what Americans enjoyed for decades. It’s “the worst economic-growth record of any president” since the Great Depression, says Stanford economist Michael Boskin.

Last week’s economic reports were bad news for job seekers. Growth dipped below 1 percent in the first quarter, and full-time employment actually shrank in May.

We can’t let Obama-stagnation become the new normal. It’s driving Americans to self-destruction. Deaths from alcoholism, drug addiction, cirrhosis of the liver and suicides — what Princeton University researcher Anne Case calls “deaths of despair” — have soared.

These tragedies raise the stakes in this presidential election. Who’s equipped to jump-start America’s economy, Hillary Clinton or Donald Trump?

Spoiler alert, it’s not Hillary. She makes her money giving speeches and promoting books about herself.

Of course, Trump is no slouch when it comes to self-promotion. But he’s made a fortune actually building businesses. Trump runs an impressive 185 income-producing ventures, all listed on his 104-page Financial Disclosure Statement. (Hillary’s is only 11 pages.)

The mogul has built office buildings, apartment buildings, golf resorts and other ventures worldwide. He builds things and creates jobs. He also rakes in hefty fees managing properties worldwide, because their owners are confident he’s effective.

People like Trump, who run businesses themselves, understand why our economy is stuck in low gear. High taxes and suffocating, costly regulations are turning off investors. As economist Larry Kudlow explains, investment — in computers, factory buildings, equipment, trucks — is declining, indicating slow job growth ahead. A business that can’t buy more trucks can’t hire more drivers.

To boost investment, Trump calls for lowering taxes on businesses to 15 percent — less than half the nominal rate now — and reducing regulation. Obama calls Trump’s tax policies “crazy.” But if you want to see crazy, take a look at Hillary’s proposals.

She calls her plan “fair growth.” The phrase should strike terror into the heart of any business owner. It means more gender and racial preferences in hiring, more government rules on how employees are paid, and tax hikes to push companies into what she calls “far-sighted investments.” Yikes, Uncle Sam will be taking a seat in board rooms and looking over managers’ shoulders.

That will discourage investment. Weak investment is already to blame for the hiring slowdown, points out economist David Malpass. Overall, the economy lost 59,000 full-time jobs, gaining only in part-time spots.

America is becoming a nation of part-timers. The average work week has shrunk to 34 hours — not enough to support a family.

Hillary wouldn’t know. She pulls in $250,000 for an hour at the podium, and sometimes racks up two speaking fees a day. Nice work if you can get it. Who needs full-time?

Hillary earns her money blabbing, while Trump earns his building.

Clinton is assailing Trump for not releasing his tax returns. Face it, most politicians willingly release their returns because there isn’t much to see. (Like speaking fees.) Whereas a builder’s return reveals how he makes money — suppliers, labor, depreciation and everything else.

Now Washington pols are pushing a bill authorizing the IRS to release the returns of any presidential candidate who doesn’t disclose voluntarily. Who would want the IRS to have that power?

The real issue isn’t Trump’s taxable income, but what the rest of us are able to earn. Americans need more take-home pay. The prospects look better with a builder in the White House than with a blabber.


Article Link to the New York Post:

How Isolated Is Netanyahu?

By Jonathan S. Tobin
Commentary
June 8, 2016

After the much-anticipated French-sponsored Middle East peace conference ended last Friday with a whimper rather than a bang, Israeli Prime Minister Netanyahu’s critics were quick to point out that he shouldn’t be celebrating. They were right in that the event may be just the prelude to more such initiatives whose sole intent was to isolate the Israelis and perhaps set up one more climactic confrontation with the Obama administration this fall after the presidential election. It’s possible that at that point the United States might not oppose a new push for recognition of a Palestinian state without requiring it to first requiring it to make peace with Israel. If so, any satisfaction of the clear failure of the Paris conference would be premature. But as Netanyahu soon proved with a visit to Russia that highlighted Israel’s increasingly warm ties with the Putin regime, his nation is not as isolated as the prime minister’s domestic critics and foreign foes think.

Despite the French boasts about their plans to convene a conference that would establish a framework for Middle East peace without the presence of Israel or the Palestinians, nothing was accomplished in Paris. Nothing, that is, other than the usual bloviating by the French hosts and various Third World foreign ministers that were allowed to make speeches. If critics of the Obama administration can glean any satisfaction from this farce, it is that Secretary of State John Kerry was forced to sit through all of it for the sake of amity with Paris even though he was clearly put out by the futility of the effort and the indignity of having to attend. The platitudes issued at the end of the gathering could have just as easily been put out without the expense and inconvenience of the summit which left the world farther from a resolution of the conflict between Israel and the Palestinians than it had been before it started. The only thing it accomplished was to encourage the Palestinians to continue to refuse to negotiate directly with the Israelis because such conferences make them think the international community will bludgeon and isolate the Jewish state into concessions at no cost to themselves.

Moreover, those counseling that danger lies ahead, specifically from an Obama administration that, despite only having seven months left in office, still feels it has a score to settle with Netanyahu. The Palestinians torpedoed every administration Middle East initiative over the past seven and a half years even though each one sought to tilt the diplomatic playing field in their direction. But the White House continues to rail at the Israelis while largely giving the Palestinians a pass for their ongoing refusal to make peace.

That pattern reasserted itself this week when National Security Advisor Susan Rice addressed the American Jewish Committee and, though promising military aid and saying that Israel wouldn’t be abandoned, also blasted Israeli government policies on settlements. Rice drew an analogy between the presence of Jews in places that are not only part of Jewish history but also decades old, and Palestinian incitement and violence. In this view, the mere act of a Jew living in the West Bank or Jerusalem is morally equivalent to a Palestinian murdering a Jew. Whatever one’s views about the wisdom of the settlements, this is offensive.

Nor does such false moral equivalence come to grips with the fact that the only thing that has prevented the implementation of the two-state solution the U.S. advocates is the fact that Palestinian Authority leader Mahmoud Abbas, like his predecessor Yasir Arafat, finds it impossible to recognize the legitimacy of a Jewish state no matter where its borders might be drawn.

Such rhetoric leaves open the possibility of a betrayal of Israel at another peace conference later this year or at the United Nations. That is especially true since Rice’s talk of this being “a time of concern and sometimes of sorrow” for those observing Israel, she is not talking about it being assaulted by Palestinian terror so much as she is mourning yet another failed U.S. effort to manipulate the composition of the Israeli government.

But as much as the hostility of Washington and the growing chorus of critics of the Jewish state in Europe — who are clearly influenced by the rising tide of anti-Semitism on the continent — is a cause for deep concern, the situation is not as dire as it might have seemed in Paris. The first piece of evidence was Netanyahu’s warm reception in Moscow today.

While it would be misleading to assume that Netanyahu’s fourth meeting with Vladimir Putin in less than year makes Russia an Israel ally, it is nonetheless clear that Moscow is more interested in its increased security cooperation with the Jewish state than in helping the French or President Obama. The Israelis must be wary of Putin, who is playing a dangerous game with military intervention in Syria. But the visit, along with growing Israeli ties to moderate Arab countries that are disillusioned with and scared by the Obama administration’s appeasement of Iran, are a reminder that the new Middle East that has arisen in the wake of America’s retreats is one in which Jerusalem is not as isolated as its critics might think.

Netanyahu’s statement last week, in which he spoke of being willing to negotiate about the 2002 Arab Peace Initiative (a statement that was greeted with silence by the international community and a demand from Abbas that Israel withdraw unconditionally from every inch of the land it won in 1967 including the Old City of Jerusalem), was a bow in the direction of moderate Arabs who no longer see the Jewish state solely as an enemy. Though this alliance of convenience should, like ties with Russia, not be mistaken for a relationship based on common values and trust, it is nevertheless a fact. Saudi Arabia, as well as nations like Jordan and Egypt, understand that they need Israel as a bulwark against the unfolding chaos in Syria and an Iran that has been enriched and empowered by Obama’s nuclear deal.

With growing ties with Moscow and Arab countries that pay lip service to the Palestinian cause but won’t risk their security for it, Israel is not alone nor without options. The next several months will be a perilous time for Israel as the Palestinians seek to take advantage of Obama’s waning influence. They, along with their international cheering section that is indifferent to the influence and power of Hamas and the possibility that a Palestinian state in the West Bank would become a second Gaza, know that the next administration is bound to be more favorable to Israel than its predecessor. At the very least, both a Trump or a Clinton administration will not start out with a grudge against Netanyahu or the mistaken belief that more “daylight” between Washington and Jerusalem is a formula for peace as Obama did. The future is uncertain, and no one should underestimate the dangers for Israel. But it is nowhere near as bleak as Netanyahu’s critics claim.


Article Link to Commentary:

Why Putin Is Meddling In Britain’s Brexit Vote

The Kremlin claims it’s neutral as Britain prepares to vote on whether to leave the European Union, but Russia’s own propaganda says otherwise.


By Nico Hines and Pierre Vaux
The Daily Beast
June 8, 2016

LONDON — The only big-name pols on Earth who think Britain should leave the European Union are Donald Trump, Marine Le Pen and Vladimir Putin.

Or so the campaign for Britain to remain in the EU keeps telling us.

Trump is open about his support for the British exit, or Brexit, and will be in Britain on the day of the referendum results. French hardliner Le Pen is keen to campaign in Britain—even though the “leave” camp has publicly demanded she stay away.

The Kremlin, on the other hand, totally denies that Putin wants Britain to quit the 28-member economic and political union. Officials insist that the Russian president remains entirely neutral. He has offered no public statement on the June 23 referendum and his colleagues have been uncharacteristically quiet.

That doesn’t mean Putin isn’t doing everything he can to help force Britain out—he’s just a lot smarter than Trump and Le Pen.

Putin knows British voters don’t want to be told what to do by a Russian autocrat (any more than they are likely to take instruction from a gaudy New York property tycoon or a truculent French xenophobe).

Putin also has something Trump and Le Pen only dream about: real power and a state apparatus to command. Western diplomats and security officials are increasingly aware that Putin is willing and able to use one of the world’s most expansive intelligence and propaganda operations to try and destabilize the European Union.

“It’s asymmetrical warfare—this is KGB stuff—where you’re carefully funneling money into propaganda to nudge people,” said Charles Crawford, a former British diplomat who worked in Moscow before he was appointed British ambassador to Sarajevo, Belgrade and then Warsaw.

Britain voting to leave would be the biggest jolt to the union that has been taking shape, and growing—in various guises—ever since Europe began to emerge from the rubble of World War II. Britain, after some reluctance, joined back in 1973.

When this year’s referendum was announced, pollsters predicted that there would be a majority in favor of staying in the union, but recent polls suggest the race is too close to call.

“The Kremlin is actively trying to influence things; the question is how best to do that because you don’t want to do that in a way that’s obvious because it backfires,” Crawford explained to The Daily Beast.

Relations between London and Moscow are already at their lowest ebb since the Cold War, exacerbated by the findings of an official inquiry earlier this year that émigré Alexander Litvinenko had likely been assassinated with radioactive poison on the orders of the Kremlin.

Prime Minister David Cameron and Philip Hammond, the Conservative foreign secretary, have both accused Putin of advocating for Britain to leave the EU, which seemed to infuriate Russia’s embassy in London.

“Russia is being dragged into the domestic debate on Brexit,” a spokesman said. “As a matter of fact, our Government doesn’t have an opinion on Britain’s place in the EU.”

As part of the British Foreign Affairs Committee’s inquiry into the appalling relations with Russia, five Members of Parliament travelled to Moscow last month for meetings with politicians in the Duma and officials at the foreign ministry.

Three of those MPs told The Daily Beast that Russian officials had expressed their frustration at being publicly linked to the Brexit campaign.

“The regime and Putin in particular—whilst they’ve not put forward an official line, because obviously that might be counter-productive—would be very pleased if Britain exited the European Union,” said Mark Hendrick, a Labour member of the parliamentary committee, who wants Britain to remain in the EU.

Hendrick said it was clear from their meetings in Moscow with Russian officials, business leaders, academics, experts and U.S. Ambassador John F. Tefft that Putin prefers the one-on-one brinksmanship of bilateral relations rather than dealing with a united entity like the EU.

“They prefer a U.K. separate from the European Union and to see the European Union break up. The fact that the Poles, the Czechs, and the Slovaks, and all these others that were in the Warsaw Pact, are in the EU as well as NATO is not a trend they want to see continue,” he said.

The “leave” campaign has ridiculed suggestions that Putin is secretly helping them to win, and Crispin Blunt, the chairman of the Foreign Affairs Committee, who is campaigning for Britain to quit, said the Russian officials had done nothing to endorse Brexit during their trip.

While it is true that Russian state officials have carefully avoided any public comment, there is a clear pattern of agitation for withdrawal from the EU on Russia’s state-owned, English-language news outlets Russia Today, a television network, and Sputnik, a news site.

Analysis of recent news stories shows a clear bias towards quoting anti-EU campaigners in articles that claim to show balance. One news story quotes extreme right-wing Polish politician Janusz Korwin-Mikke, who says Britain would be right to leave the EU. (He also offers his support for Trump because “Clinton is supported by the Jews.”)

The propaganda is even more blatant among the recent op-eds on RT and Sputnik. Among them are articles claiming that the EU was the creation of the CIA and two RT pieces decrying EU “brainwashing.” The leader of Britain’s U.K. Independence Party (UKIP), who was instrumental in forcing Cameron into calling the EU referendum, is also a regular guest on RT.

“One of the main lines in Russian propaganda is that Europe is in decay, in chaos, that it is divided, becoming increasingly irrelevant, and obviously a decision by the British to exit the Union would feed that line of argument enormously,” said Joerg Forbrig, from the German Marshall Fund of the United States.

Along with Russia’s official news outlets, secretive troll factories are pumping out huge quantities of propaganda. Low-paid workers create thousands of pro-Kremlin blogs, social media posts and comments on local and Western news outlets. Diplomats believe Brexit is one of the latest topics of the trolls’ propaganda machine.

Sometimes Russian officials get involved directly. As Germany was seething with racial tension earlier this year amid the struggle to cope with an influx of immigrants, the Russian embassy in London tweeted: “German government threw their country under feet of migrants like a rug, now try wipe their crimes under carpet.”

Beyond propaganda, Russia is also known to intervene more directly in Western politics. “I do think that the Kremlin has been trying to reach out to the leave campaign. There may well be support but it will be very hard to find out about this because they will be extremely discrete,” Forbrig told The Daily Beast. “We do know that the Kremlin is also materially supporting other actors that have potential to undermine European unity, and the European Union.”

For example, cash and support was given to far right media outlets in the Western Europe. Voice of Russia, a state radio station that was folded into Sputnik in 2014, gave $470,000 to a French web TV channel founded by a former Front National advisor. The state-owned outlet also partnered with the Italian Lombardy-Russia Cultural Association, which was founded by the far-right Lega Nord.

Radical right-wingers campaigning for Britain to leave the EU were also invited to events hosted by Russia. Nick Griffin, the former leader of the racist British National Party, and Jim Dowson, the founder of Britain First—a far-right street party, attended a conference of neo-Nazis in Saint Petersburg last year.

One of the most blatant Russian interventions in the Eurosceptic fringe of Western politics has been seen in France. The Front National received a $10 million loan from the Kremlin-linked First Czech Russian Bank in late 2014, and the party’s leader Marine Le Pen reportedly has made several trips to Moscow, meeting with Putin in secret. Members of the European Parliament from her faction and a key adviser, Emmanuel Leroy, have made several visits to the occupied city of Donetsk in eastern Ukraine, and pledged their support for the Russian-backed separatist cause.

Of course, she is also an outspoken supporter of Britain’s campaign to leave the EU. She said a vote for Brexit would “prove it’s possible to live outside the EU. You’re either free or you aren’t.”

Britain’s referendum at the end of this month is “a key moment in European history,” she said.

Vladimir Putin is counting on it.


Article Link To The Daily Beast:

America, China, India And Japan: Headed Towards A South China Sea Showdown?

This could be bad, really bad.


By Sam Bateman
The National Interest
June 8, 2016

Recent months have seen a continuing increase in military activities in the South China Sea, particularly by the United States and China, but also by ‘bit players’ like India and Japan. These activities only serve to heighten tensions in the region at a time when the priority should be to demilitarize the area.

In the most recent serious incident, on May 17, two Chinese fighter jets intercepted a US Navy EP-3 intelligence and surveillance aircraft [3] about 50 nautical miles east of Hainan Island. This incident could have violated agreed upon procedures between the United States and China to manage such encounters. It follows earlier incidents when Chinese jet fighters intercepted US P-8 Poseidon surveillance aircraft over the South China and Yellow seas.

The United States [4] recently conducted its third freedom of navigation operation (FONOP) [5] in the South China Sea since China started its extensive land reclamation and building of airfields and support facilities on reclaimed land in the Spratly Islands. The latest FONOP involved a US warship sailing close by the disputed Fiery Cross Reef. In March, the United States sent a small fleet of warships [6] — comprising aircraft carrier John C. Stennis, two destroyers, two cruisers and a Japan-based US Seventh Fleet flagship — into contested waters to counter the presence of China.

During his recent visit to Vietnam, President Barack Obama announced that the United States would be lifting its longstanding ban [7] on sales of lethal military equipment to Vietnam. This has been construed as part of a strategy to help Vietnam defend itself against an increasing threat from China in the South China Sea. In return, Vietnam might grant the United States access to the strategic Cam Ranh Bay military base. Along with access to bases in Palawan in the Philippines [8], this would markedly enhance America’s ability to project military power into the South China Sea.

Lyle Goldstein from the US Naval War College suggests in his recent book Meeting China Halfway [9] that rather than enhancing US military engagement with Vietnam, Washington should be ending it, arguing that “recent overtures toward military cooperation between Hanoi and Washington have violated reasonable principles of geopolitical moderation.” Unfortunately, moderation has not been evident in any recent developments in the South China Sea.

What is significant about recent American naval activities in the region [10] is that Washington has chosen to announce them with a blaze of publicity. This suggests a clear intention to confront China and to show the world that the United States is doing so.

India added to tensions recently when it sent a force of four naval vessels into the South China Sea for a two-and-a-half-month-long deployment, which includes participation in Exercise Malabar off Okinawa [11], jointly with the US Navy and the Japan Maritime Self-Defense Force. Predictably, Beijing reacted strongly to this naval deployment, saying that New Delhi should not encourage Tokyo and Washington to bring added tensions to the region.

Meanwhile a Chinese strike group of three guided missile destroyers, two frigates and a supply ship, in addition to a submarine and aircraft carrier, have been conducting exercises in the South China Sea [12]. This group patrolled off Chinese-controlled reefs in the Spratly Islands, including Fiery Cross Reef, only a day before the American FONOP near that reef.

All this is looking like dangerous brinkmanship. All the major powers in the South China Sea are trying to achieve an advantageous outcome by pushing dangerous events to the edge of active conflict.

Anyone who knows China and its history will know that China will go to the brink. But it will not be China that actually goes over the brink. It’s much more likely to be one of the countries taking China to the brink that does so. China, with a ‘home ground’ advantage and numerous military and civil assets in the region, can readily create a situation where one of the other parties will be forced to fire the first shot or to back down. Hopefully, though, current rules of engagement won’t allow a first shot to be fired. But we can’t be sure of that.

Significantly, the countries that are taking China to the brink are extra-regional players with often overstated interests in the South China Sea. They are ‘burning their boats behind them’, with nowhere to go other than to back down or fire the ‘first shot’. They have no concept of an end game other than compelling China to back down and follow their ‘rule of law’. But that is not going to happen.

The sad reality is that all this brinkmanship is adding to the strategic distrust that pervades the region at present.

Unfortunately, no existing regional forum has been prepared so far to address the implications of greater military activity in the South China Sea and the increased tensions that result. The sovereignty disputes currently attract greater attention. This obsession with sovereignty leads to a situation where sovereignty is not just an obstacle to effective management of the South China Sea and activities within it, but also to any preparedness to address measures to demilitarize the sea.

Demilitarising the South China Sea should be an objective of all stakeholders. To this end, China should clarify its claims in the South China Sea and refrain from activities that might be seen as assertive or aggressive. Japan and India should moderate their activities, and the United States should step back from its current naval initiatives, including by not undertaking provocative FONOPs. These prominent players in the South China Sea should all back off from their current military activities, lest the region continue down a track that could lead to more serious incidents and even conflict.


Article Link to the National Interest:

Expensive and Useless: America's Botched Afghanistan Aid

USAID can't even reliably tell you where its projects are.


By Cheryl Benard
The National Interest
June 8, 2016

On June 4, India’s Narendra Modi traveled to the Afghan city of Herat to join Ashraf Ghani in inaugurating the Salma Dam, renamed the India-Afghanistan Friendship Dam for the occasion. The dam, a multi-decade project funded by India, provides two things that are urgently needed by millions of Afghans every day: water and electricity.

Social media, for once without the usual cynicism, celebrated the event as a genuine step forward for the still impoverished, still struggling Afghanistan. To us in the United States, the Salma Dam can serve as a forty-five-megawatt, seventy-five-thousand-irrigated-hectare object lesson for how far we have drifted in the wrong direction, in our understanding of development aid and, yes, of friendship. We used to build dams, too—in Afghanistan, for that matter. Now we’re trying to build democracies and educate others about human rights, women’s equality, freedom of the press . . . We’ve become the exporter of intangibles—no, not even that. We’ve become the exhorter of intangibles. Do this. Don’t do that. Do it this way.

Consider the new favorite of U.S. development aid: the workshop. Not an actual workshop teaching something real, like carpentry or farming, these are California-ish feel-good sessions in which women, mostly, and generally the same ones over and over again—the ones who speak good English and have the savvy to get themselves on the invitee list (which is then recycled endlessly because that’s so much easier than looking for new candidates)—are informed by their “trainers” that they are equal, important and born to be leaders, whereupon they practice writing their “visions for the future” on a whiteboard and giving fictitious radio interviews, two skills that are clearly essential for oppressed women in traditional societies in post-conflict situations. The graduates go on to a “train the trainer” course, and if they play their cards right, to the advanced class and the refresher workshop and the specialized class on how to run for office. It can become something like a profession, with free meals, a stipend, days spent in nice hotels and for the especially lucky, conferences in Dubai or Europe or even the United States. USAID runs a $416 million program called Promote, intended to bolster the self-esteem of Afghan women and “empower” them to be leaders.

Afghanistan’s first lady, a generally tactful, polite and very diplomatic person, is not a fan. She warned with unusual directness that:

“I do hope we are not going to fall again into the game of contracting and sub-contracting and the routine of workshops and training sessions generating a lot of certificates on paper and little else.”


The U.S. government’s own Inspector General for Afghan Reconstruction (SIGAR), upon reviewing the program, was even more direct, expressing the concern that “the Afghan women engaged in the program may be left without any tangible benefit upon completion”—which also translates into the American taxpayer having squandered those hundreds of millions of dollars.

No attention has been paid to these warnings, and indeed it would be difficult to change course: an entire apparatus replete with departments, bureaus, officials, career paths and, of course, massive and major vested interests has grown up around this currently fashionable approach.

The “game of contracting and sub-contracting” mentioned by the first lady was also what brought ruin to our more conventional development aid in the first place. Under this ill-advised process, a very large sum of money is allotted for a particular project—let’s say, health clinics in rural areas. The money is given to a major contractor, who in turn has spent vast amounts of effort and money building relationships with the U.S. government agencies dispensing these goodies, and has hired a staff of grant writers who know the respective agencies and the lingo they prefer, often because they themselves were employed there in the past. Upon winning the bid the lead contractor, known as the “prime,” takes a hefty slice and then immediately farms the project out to one or more subcontractors, who take their share and hand it off in turn. Along the way an expensive Kabul office is rented, SUVs purchased, security guards hired and a domino process of further subcontracting is launched, at the conclusion of which a few Afghan or Pakistani workers hired by a local ramshackle business are sent out with spades, hammers and the negligible remains of a once huge budget to slap something together. It doesn’t matter, because due to security regulations, the USAID officer in charge is not allowed to visit the site, will never come anywhere near the project and can safely be told—this happens all the time—that the clinic has been completed, when in truth the only thing in place is a slab of cracked concrete out somewhere in the desert, possibly slanted into the dirt to approximate the mandated handicap ramp. The intrepid SIGAR, which actually goes out into the field, found that many clinics were ten kilometers or more from their designated location, that many had no running water or electricity, and had cracked walls, mold and other basic construction issues.

The problem of absent quality control has plagued U.S. infrastructure projects in Afghanistan from the start. The Kabul-to-Kandahar road, due to the multiplicity of subcontracting agencies with no one actually accountable, initially omitted the many bridges and overpasses along the way, which meant that cars and trucks had to veer off the paved road and chart their own course across unpaved terrain several times during the journey—as I can personally attest from my own road journey in 2003, shortly after the road’s inauguration. Indifferent oversight also meant that the road began degrading after just two years. In sum, $4 billion so far has gone into the massive U.S.-led road-building project in Afghanistan. Shoddy workmanship, compounded by heavy trucking traffic and the occasional roadside bomb, have made most of these roads into high-fatality, accident-riddled death traps, with pieces of unsecured pavement sliding away and crater-sized holes appearing suddenly to swallow up the unsuspecting taxi. The U.S. government has since come to the revolutionary insight that building roads without a maintenance plan and without solid quality control is pointless, but that doesn’t mean we’re going to stop, or change the system: there are still contracts that were previously awarded and they are going forward, indeed, with increased budgets. Due to declining security, road building now costs $5 million a kilometer, for work that will barely outlast its ribbon cutting.

SIGAR, the government office tasked with overseeing Afghan reconstruction projects, God bless it, has been bleating its little heart out for years in a completely futile, utterly ignored effort to make someone—anyone—listen. They have warned of waste, of multiple millions of dollars simply unaccounted for, of the fact that the responsible USAID officials are not only failing to provide oversight, but can’t even reliably tell you where the projects that they have never visited, and are attempting to keep track of through geospatial monitoring and photographs, are hypothetically located. They have numbers, they have names, they have concrete evidence, they’ve actually been on the ground, but no one listens. They have found several of the largest mega-contractors guilty of mismanagement, even outright fraud, but after a slap on the wrist, those same companies are granted the next mega-contract.

Roads having fallen out of favor, the watchword of the day is the “workshop”—unsurprisingly. How much easier to bring twenty women into the ballroom of the Serena Hotel and have them practice speaking assertively into a microphone for three days. How much more convenient to assemble some random women, appoint them as “voices” against violence, and have them pledge to go home and tell their sons not to join the Taliban. The metrics? No problem. These women know which side their naan is buttered on, and your concluding feedback questionnaire will be effusive. 

"This has changed my life and I will now go forth and liberate all the other women of Afghanistan. While also ending the insurgency by speaking sternly with my son. Thank you, America."

Rather than go on playing this expensive, useless game, why not just do nothing at all? Or why not partner with a country that knows this kind of setting, understands this sort of population and its needs, and can operate here—India, for example? A country like that understands “empowerment” can require different things in different contexts.

When you are highly advanced and living in peacetime, and your switch turns on the lights, you can define “empowerment” as meaning that women should speak up more loudly in the next board meeting. But when you are trying to dig out from under forty years of war, and when you were one of the poorest and least developed countries in the world even before that, “empowerment” might mean just that: a dam that brings you actual kilowatts of actual power.

And I hypothesize this: when they irrigate their fields with the resulting water, or take their child to a clinic and there are lights on and water is coming out of the tap, the Afghan beneficiaries in their thousands will think: democratic India, right next door to us, is really something! Maybe we should go that route, too . . . .

It’s not clear how the twenty trainees taking a luncheon buffet break in the Serena Hotel will achieve the same effect.


Article Link to The National Interest:

5 Takeaways From The Night The General Election Began

Clinton makes history, Trump’s under pressure and Bernie weighs his demands.


By Glenn Thrush
Politico
June 8, 2016

BROOKLYN — Before there was a Glass Ceiling speech in Washington, there were jaws on the floor in Manhattan.

On the night of June 3, 2008, Hillary Rodham Clinton summoned the sweaty, exasperated traveling press corps to a windowless auditorium at Baruch College, a careworn link in the city’s university system known for churning out business degrees. Despite the humble surroundings, it had the makings of a moment — the eve of the final two contests of the perpetual primary — and rumors flew that Clinton would end her battle against Barack Obama right there and then.

Not a chance — she had one more middle finger to aim at the hope-and-change candidate. “Whatever path I travel next, I promise I will keep faith …,” she concluded ambiguously, and annoyingly. Nobody wanted her to travel anywhere at that point, not even her staff; they just wanted her to get out. Several reporters, professionals with good health insurance who double-recorded every event just in case the first recorder cut out, booed and hissed in the grubby filing center. I might have been one of them.

“She was still too pissed off, and she wasn’t ready to concede yet,” one of Clinton’s top 2008 staffers told me. “She was basically Bernie Sanders — she wanted to give one more big f--k you speech, she was doing the whole system-is-unfair rant, she was convinced the superdelegates had screwed her over. She was in the same place. She understands where his head is at.”

But she doesn’t, not really. Despite their superficial similarities (insurmountable delegate deficit, pressure from party elders, the absence of any more Super any-days), Clinton and Sanders were — and are — two very different politicians headed in very different directions.

Sanders is older, with less to lose, angrier and aiming to break an entire political-economic system, not just bust a hole in a barrier, as Clinton’s ’08 campaign sought to do. His crowds are still big — he’s a smaller man without them — and he isn’t exactly looking forward to heading back to the diminished vistas of the United States Senate.

What he will do now — whether he intends to fight on against Clinton and the math of winning the nomination in his adopted party — is the final unwritten chapter of the 2016 primaries.

Here are five takeaways on the last big day of an unforgettable political season that reaped the whirlwind:

1. Hillary Clinton is the first woman to win a major party’s presidential nomination. 

Caveats crowd the woman like bad vibes at a Trump rally in a multiracial urban population center. Emails, her husband’s affairs, trust issues, abysmal unpopularity numbers, flip-flops on trade and gay marriage, questions if she’s the authentic progressive the party demands this year, you know the drill. But the republic has been around for 240 years and no woman has even come this close to winning the presidency, and that’s not nothing. Actually, it’s quite something.

The Sanders campaign may demand the coronation be delayed until the convention, but Hillary Clinton will be the Democrats' nominee for president in 2016, and that is a moment worth honoring, even if you don’t support her candidacy. Women represent more than half of the country’s voting population, but they are 0-44 when it comes to the presidency — and Clinton is one step closer to the ultimate prize 100 years after Jeanette Rankin of Montana became the first woman to be elected to the House and 96 years since the passage of the 19th Amendment, which granted women the right to vote.

Shirley Chisholm, the black Brooklyn congresswoman who ran a quixotic and courageous campaign for the White House in 1972, famously said, “If they don't give you a seat at the table, bring a folding chair.” For all her flaws, Clinton never folded, despite personal and political adversity, and her grit has finally earned her a place in the American political pantheon no matter what happens in November.

2. How many Republicans will un-endorse Donald Trump? 

With Clinton pinned down by Sanders in a protracted primary battle, Trump surged in the polls against Clinton and put a fright into Democrats who were already measuring the inaugural drapes.

Then came one of the Donald-being-Donald eruptions that so often bounced off his one-man campaign harmlessly — except this time it didn’t. Trump’s preemptive attack on the Mexican-American judge in the case against his for-profit university sparked a wave of GOP revulsion the likes of which he had yet to see. Sen. Lindsey Graham (admittedly the most reluctant endorser in the GOP field) essentially suggested un-endorsing his party’s presumptive nominee, calling Trump’s outburst “un-American.”

“If he continues this line of attack, I think people really need to reconsider the future of the party,” Graham said earlier this week. No one else immediately followed suit, but there was a collective shunning that took root as the implication of questioning a judge based on ethnicity sunk in. Senate Majority Leader Mitch McConnell not-so-delicately suggested Trump “start talking about the issues that the American people care about and to start doing it now."

Those weren’t exactly fighting words, but they suggested an end to the shaky détente between Trump and the party establishment — at the precise moment Clinton began pivoting away from Sanders to her general-election opponent. “The illusion that the Democrats were the party in the midst of a civil war is fading away,” said a top adviser to a former Trump opponent.

3. Release the hounds! 

For the past couple of months, Clinton’s Brooklyn-based surrogate handlers have muzzled Democratic allies who wanted to whack Sanders for staying in the race beyond what they believed to be his sell-by date. While Clinton herself will continue her policy of being polite and more-or-less non=confrontational to the sensitive second-place finisher, several people close to the campaign say the hold on surrogates was officially removed Tuesday night.

Senate Democratic Leader Harry Reid has already prodded the Vermont senator to return to the back bench — and other Clinton allies, like California Congressman Xavier Becerra, have suggested as much too. Expect those statements to become significantly more pointed as talks between the Clinton and Sanders campaigns drag on, people close to the former secretary of state said.

4. What does Bernie want?

That’s the big question as Democrats seek to consolidate their party with a self-described Socialist who spent the past week vowing to create a “contested” convention in Philadelphia next month. Sanders supporters are clearly gunning for a sweeping overhaul of party rules that close primaries to many independents, and they are also pushing for an end to the superdelegate system that the candidate has decried as a scourge against democracy — and that may be his only remaining path to the nomination.

But popular also-rans — and Sanders was on pace to rack up 7 million-plus votes by Tuesday night (3 million fewer than Clinton) — want real power. And nascent negotiations between the two camps haven’t progressed far enough to determine precisely what Sanders’ wish-list includes. In a podcast interview earlier this year, Sanders strategist Tad Devine floated the idea of Clinton naming him as her vice president. But sources on both sides say that’s highly unlikely, given Sanders’ age and the bitterness of his late campaigning.

More likely: A fulsome consideration of more stringent Wall Street regulation (the Clinton campaign has been in quiet talks with Massachusetts Sen. Elizabeth Warren on those issues and others for weeks), party platform language that permanently bonds Clinton to her recent anti-free-trade stances and a coordinated policy to attack income inequality.

5. What does Jane want? 

Sanders, propelled by his massive crowds and popularity with youth voters, simply hasn’t accepted that Clinton — who has run a plodding, efficient and less-than-scintillating campaign — has actually bested him. Still, Sanders does recognize the end is near, according to Democrats and Sanders supporters — but he’s surrounded by an inner circle of advisers, led by feisty campaign manager Jeff Weaver, who have convinced him that he still has a shot and should give little ground for the sake of leverage in future talks with Clinton.

But his most militant adviser is his wife, Jane, who has spurred him to step up his attacks on Clinton. The former university president — such a power in her husband’s world she was once given a desk in his Senate office — is still holding out, people close to the situation tell me.

“She’s as powerful as Hillary was in Bill’s ’92 campaign,” a Sanders supporter told me. “As she goes, so goes Bernie.”

Article Link to Politico:

Inside The Bitter Last Days Of Bernie's Revolution

For better and for worse, Sanders made all the big decisions.



By Edward-Isaac Dovere and Gabriel Debenedetti
Politico
June 8, 2016


There’s no strategist pulling the strings, and no collection of burn-it-all-down aides egging him on. At the heart of the rage against Hillary Clinton and the Democratic Party, the campaign aides closest to him say, is Bernie Sanders.

It was the Vermont senator who personally rewrote his campaign manager’s shorter statement after the chaos at the Nevada state party convention and blamed the political establishment for inciting the violence.

He was the one who made the choice to go after Democratic National Committee chair Debbie Wasserman Schultz after his wife read him a transcript of her blasting him on television.

He chose the knife fight over calling Clinton unqualified, which aides blame for pulling the bottom out of any hopes they had of winning in New York and their last real chance of turning a losing primary run around.

And when Jimmy Kimmel’s producers asked Sanders’ campaign for a question to ask Donald Trump, Sanders himself wrote the one challenging the Republican nominee to a debate.

There are many divisions within the Sanders campaign—between the dead-enders and the work-it-out crowds, between the younger aides who think he got off message while the consultants got rich and obsessed with Beltway-style superdelegate math, and between the more experienced staffers who think the kids got way too high on their sense of the difference between a movement and an actual campaign.

But more than any of them, Sanders is himself filled with resentment, on edge, feeling like he gets no respect -- all while holding on in his head to the enticing but remote chance that Clinton may be indicted before the convention.

Campaign manager Jeff Weaver, who’s been enjoying himself in near constant TV appearances, and the candidate’s wife Jane Sanders, are fully on board. But convinced since his surprise Michigan win that he could actually win the nomination, Sanders has been on email and the phone, directing elements of the campaign right down to his city-by-city schedule in California. He wants it. He thinks it should be his.

“Bernie’s been at the helm of this campaign from the beginning,” said Weaver, “and the overall message of this campaign and the direction of the campaign and the strategy, has been driven by Bernie.”

Convinced as Sanders is that he’s realizing his lifelong dream of being the catalyst for remaking American politics—aides say he takes credit for a Harvard Kennedy School study in April showing young people getting more liberal, and he takes personal offense every time Clinton just dismisses the possibility of picking him as her running mate—his guiding principle under attack has basically boiled down to a feeling that multiple aides sum up as: “Screw me? No, screw you.”

Take the combative statement after the Nevada showdown.

“I don’t know who advised him that this was the right route to take, but we are now actively destroying what Bernie worked so hard to build over the last year just to pick up two fucking delegates in a state he lost,” rapid response director Mike Casca complained to Weaver in an internal campaign email obtained by POLITICO.

“Thank you for your views. I’ll relay them to the senator, as he is driving this train,” Weaver wrote back.

In the run-up to the California primary, the big strategic question was how much to modulate the tone of the letter to superdelegates that he's been preparing to send out Wednesday, building on the case that Sen. Jeff Merkley, Rep. Tulsi Gabbard, former Sen. Paul Kirk and former Communication Workers of America president Larry Cohen have been making to fellow superdelegates over the phone for weeks about polls and other factors that would make Sanders the more competitive general election candidate.

This isn’t about what’s good for the Democratic Party in his mind, but about what he thinks is good for advancing the agenda that he’s been pushing since before he got elected mayor of Burlington.

Sanders owns nearly every major decision, right down to the bills. A conversation with former Iowa Sen. Tom Harkin about getting left in personal debt from his own 1992 presidential campaign has stayed at the top of Sanders’ mind.

He demanded that the campaign bank account never go under $10 million, even when that’s meant decisions Weaver and campaign architect Tad Devine have protested -- like making the call in the final days before Kentucky to go with digital director Kenneth Pennington’s plan to focus on data and field, instead of $300,000 to match Clinton on TV.

Sanders ultimately lost there by just 1,924 votes.

Sanders and aides laugh at the idea that he’s damaging the party and hurting Clinton. They think they don’t get enough gratitude for how much they held back, from not targeting more Democratic members of the House and Senate who opposed him to not making more of an issue out of Clinton’s email server investigation and Bill Clinton’s sex scandals, all of which they discussed as possible lines of attack in the fall. They blame Clinton going after him on gun control for goading him into letting loose on her Goldman Sachs speeches.

“If they hadn’t started at it by really going hard at him on guns, raising a series of issues against him, that really was what led to him being much, much more aggressive than he otherwise would have been,” said Devine, the consultant who helped engineer Sanders’ plans for a protest candidacy into a real campaign (and convinced him to run as a Democrat).

Since he finished approving the ads for California not long after the Kentucky strategy spat, Devine has been back home in Rhode Island, noticeably missing from cable news as a surrogate but still regularly in touch with Sanders. Devine, who’s been more anxious about what an endgame looks like, says he hasn’t heard anything from the senator that suggests he would alter his plans because of the Clinton campaign’s eagerness to have President Barack Obama endorse her and declare the primaries done.

“They would be very smart to understand that the best way to approach Bernie is not to try to push him around,” Devine said. “It’s much better if they try to cooperate with him and find common ground. They should be mindful of the fact that the people he’s brought into this process are new to it and they will be very suspicious of any effort to push him around.”

Aides say Sanders thinks that progressives who picked Clinton are cynical, power-chasing chickens — like Sen. Sherrod Brown, one of his most consistent allies in the Senate before endorsing Clinton and campaigning hard for her ahead of the Ohio primary. Sanders is so bitter about it that he’d be ready to nix Brown as an acceptable VP choice, if Clinton ever asked his advice on who’d be a good progressive champion.


* * *


Every time Sanders got into a knife fight, aides say, they ended up losing. But they could never stop Sanders when he got his back up.

Coming off walloping Clinton in the Wisconsin primary in April, the first internal numbers from campaign pollster Ben Tulchin showed Sanders within range in New York’s pivotal contest two weeks later. Though some senior aides say they realize now the dynamics of the state and the closed primary meant they never really had a shot, they also blame coverage of his New York Daily News interview and the blowup over calling Clinton “not qualified” for taking New York off the table.

Losing Pennsylvania the following week was another body blow, one of four losses in five states that night.

In the days following, before Sanders scored his win in Indiana that campaign aides feel no one acknowledged because it came the same night Trump locked up the Republican nomination, the calls started coming in from Democratic power brokers.

Senate Minority Leader Harry Reid’s call was part advice, part asking a favor, urging Sanders to use his now massive email list to help Democratic Senate candidates. Russ Feingold in Wisconsin was the most obvious prospect, and Reid wanted to make introductions to Iowa’s Patty Judge and North Carolina’s Deborah Ross—to help Democrats win the majority, but also to give Sanders allies in making himself the leader of the Senate progressives come next year.

Reid, according to people familiar with the conversation, ended the discussion thinking Sanders was on board. He backed Feingold. But that’s the last anyone heard.

Word got back to Reid’s team that Weaver had nixed the idea, ruling out backing anyone who hadn’t endorsed Sanders. Weaver says it’s because the Senate hopefuls had to get in line for Sanders’ support behind top backers like Gabbard and Rep. Raúl Grijalva (D-Ariz.)—though neither has a competitive race this year.

Sanders never followed up himself.

Just before they all figured they’d see each other at the White House Correspondents Dinner, a call from Clinton campaign chairman John Podesta came in to Devine, who’s seen by most in the Clinton camp as the only senior aide to Sanders whom Clinton’s staff feels is actually open to a conversation, though Weaver and Clinton campaign manager Robby Mook have checked in with each other occasionally as well.

“I’m ready to talk,” Podesta said, though, “I don’t have a peace pipe or anything.”

Devine brought the idea to Sanders.

“Do you trust him?” Sanders said, people familiar with the conversation said.

“Yeah, I do,” Devine said.

“You think we should talk to him?” Sanders asked.

“I think we should try to win California, and then we’ll talk to him,” Devine said.

Reaching out to the Trump campaign was a different story. Devine knows campaign chairman Paul Manafort from, among other things, their collaboration on the campaign of ousted Ukrainian President Viktor Yanukovych. According to campaign aides, the morning after Trump was on Jimmy Kimmel Live, Weaver asked Devine to give Manafort a call to see if they could actually make the debate happen. They were already fielding offers from most of the networks—including a producer for Stephen Colbert, who wanted to host the debate on his own late night show.

Manafort laughed, said it was a joke, but then again, Trump was on his plane, and he had no idea what the candidate would do. The answer turned out to be a statement killing the speculation. Manafort left a voicemail for Devine saying he’d won over Trump. Devine never called him back.


 * * *


Top Sanders aides admit that it’s been weeks, if not months, since they themselves realized he wasn’t going to be win, and they’ve been operating with a Trump’s-got-no-real-shot safety net. They debate whether Sanders’ role in the fall should be a full vote-for-Clinton campaign, or whether he should just campaign hard against Trump without signing up to do much for her directly.

They haven’t been able to get Sanders focused on any of that, or on the real questions about what kind of long term organization to build out of his email list. They know they’ll have their own rally in Philadelphia – outside the the convention hall—but that’s about as far as they’ve gotten.

“He wants to be in the race until the end, until the roll call vote,” Weaver said.

Aides say they’re going to discourage people from booing Wasserman Schultz, who’s emerged as public enemy number one among Sanders supporters, when she takes the stage at the convention. But they think it’s going to happen anyway.

Meanwhile, they’re looking into trying to replace the Florida congresswoman as the convention chair with Gabbard, and force Wasserman Schultz to resign as DNC chair the day after the convention.

The meetings in Philadelphia have already started, with the platform drafting committee set to have its opening session on Wednesday. The Sanders team is headed by Mark Longabaugh—Devine’s business partner, but who’s veered closer to Weaver when it comes to eagerness to headbutt. There are negotiations with the Clinton campaign and the DNC over what they’re going to force them to agree to, from speaking slots at the convention to long-term control over party operations to the order of early state voting (Aides say Sanders believes the race would have been radically different if the order were different, and more states were by themselves on the calendar instead of lumped together on super-ish Tuesdays).

“Everything is on the table,” Longabaugh said.

There’s also the issue of payback. Campaign aides say that whatever else happens, Sanders wants former Congressman Barney Frank and Connecticut Gov. Dannel Malloy out of their spots as co-chairs of the convention rules committee. It’s become a priority fight for him.

Sanders, the aides say, believes Frank has hated him for years, but the former Massachusetts congressman’s calling him a “McCarthyite” pushed him over the edge. He never really registered who Malloy was, despite his being from a neighboring home state and his status as one of the most liberal governors in the country, but Sanders was enraged to hear the governor say he had blood on his hands for not supporting the gun manufacturer liability law.

Aides think Democrats should be grateful that he’s increased voter turnout and registration. And it’s why they assume Clinton’s campaign will humbly request he be her college campus and millennial ambassador through the fall, to keep up the rallies and the voter registration that’s given him the 45 percent of primary voters.

“When they say we’re hurting the Democratic Party,” Devine said, “we believe we’re helping it.”

That’s because Sanders is a savvier politician than almost anyone’s given him credit for. He likes that he’s been in front of almost a million people since the campaign started. But he knows that as soon as the campaign’s done, the crowds will start thinning, and he’s not going to get on television anymore. He’s certainly not running for president again.

Sanders knows the ride is about to stop—but he’s going to push it as far as he can before it does.


Article Link to Politico:

Inside The Bitter Last Days Of Bernie's Revolution

Hillary Clinton Embraces Being First

By Jonathan Bernstein
The Bloomberg View
June 8, 2016

Hillary Clinton has made history, and tonight she traced out how she’s going to try to make some more of it.

Victory speeches are easy. The news is good, the room is packed with enthusiastic supporters, the campaign controls the visuals, and the text is usually painstakingly massaged and managed, especially if there’s plenty of advance notice. And the Clinton campaign has known for weeks, maybe months, that tonight would be the big night (despite the AP’s off-message ability to call the nomination for Clinton on Monday, thanks to a few superdelegates who talked a bit too much).

So, yes, Clinton gave about as good a speech as she can.

The emphasis was interesting. Some “firsts” play down their accomplishments; Barack Obama, the first black president, often (although not always) took that path. Tonight, Clinton made her status as the first female major-party presidential nominee central to her message.

That’s probably smart. Her first task now is to unify the party, and most Bernie Sanders voters are feminists, even if they didn’t choose to support her so far. Another is to reach out to independents and weak Republicans who are put off by Donald Trump’s bullying tone -- many of whom are women.

And even for Democrats who support her, emphasizing the chance to elect the first female president might be a good way to develop more excitement. This is especially true for a candidate who, after all, mostly promises to continue the current administration’s policies, not a radical break. The status quo is rarely exciting, so Clinton reminds everyone that she can’t possibly be the status quo.

The rest of her speech emphasized community and cooperation, set up as a sharp contrast to Trump’s harsh and divisive rhetoric. Her tag line: “Bridges are better than walls.”

Generally, candidates and their campaigns are least important in presidential general elections (compared to primary elections or down-ballot contests). Most voters wind up supporting their party’s candidate, even if they say they vote the person, not the party. Whether her polling numbers said Clinton was popular, as they did early in the campaign, or unpopular, as they do now, I’ve always thought she would perform as fairly close to a generic Democratic candidate in the general election. The only major question is whether a woman as a presidential candidate would be a small boost or a small penalty, or (as seems to be the case in lower-level elections) if it wouldn’t make much difference at all.

But make no mistake about it: Hillary Clinton is an extremely skilled politician. What she did tonight, giving a speech to supporters, is really where her talents are weakest. However, she’s an excellent debater, she handles one-on-one interviews well, and by all reports she’s good with voters in small groups. And no one earns the support of the vast majority of party actors during the invisible primary without being very good at politics.

We’ll see whether Donald Trump manages to run a competitive campaign or not. As of now, the best guess is he’ll be worse than a generic Republican -- perhaps far worse. I think Clinton had fewer high-level elected officials from her party opposing her before Iowa than Trump does now, weeks after his last competitor for the nomination dropped out. That may yet turn out to be important.

Whatever happens with Trump, however, expect Hillary Clinton to run a solid, competent, capable -- and very tough -- campaign. And if Republicans are smart, that’s what they’ll prepare for.


Article Link to the Bloomberg View:

Bye-Bye, Bernie

By Editorial Board
The Bloomberg View
June 8, 2016

In the next few days, Senator Bernie Sanders will have to decide if he wants to gamble his personal reputation and the viability of the Democratic Party -- and maybe, not to put too fine a point on it, the future of the country -- on the fantastically improbable chance that he could be the party’s presidential nominee. It’s not a risk anyone should want him to take.

He has every right to remain in the race until the Democratic convention in late July, when more than 700 superdelegates will cast their votes for the first time. In the unlikely event that Hillary Clinton is indicted prior to the convention for taking foolish risks with her e-mail while secretary of state, Sanders could conceivably convince the majority of her superdelegates to switch their allegiance to him. In the most unusual election campaign in modern memory, anything’s possible.

But it’s far more likely that by staying in the race, Sanders would squander the goodwill he has earned among many Democrats over the past year, embitter his supporters, set back Clinton’s efforts to unify the party, and weaken her prospects in November. However much he may deny it, staying in would aid Donald Trump, who Sanders has called “a pathological liar,” “a real embarrassment” and a “danger to this entire world.” If Sanders refuses to go graciously and Trump wins the presidency, he will inevitably -- fairly or not -- bear some of the responsibility. That is an epitaph he surely does not want.

Sanders has long complained of a “rigged” election process, riling up crowds with the argument that superdelegates are undemocratic. But in the end, Clinton won more votes, more states, and more pledged delegates. A Sanders victory at the convention could only be engineered by establishment insiders, the very people Sanders has delighted in attacking. In fact, Sanders vaulting past Clinton would be the most undemocratic outcome in the history of modern presidential nominations.

Sanders has spent his career crusading for socialism, and he has succeeded in doing more for his cause with this campaign than he did in his 25 years in Congress, where he was the primary sponsor of just three bills that became law. He has pushed both Clinton and President Barack Obama to the left on issues that matter most to him, including increasing benefits for Social Security. And he has even managed to galvanize young people around a political ideology that in the U.S. has long been more associated with the Soviet Union than Scandinavia.

Sanders has brought new life to the Democratic Party’s left wing, which, for better and worse, is bound to be a force for years to come. He can accomplish still more by securing a commitment from party leaders to put the question of open primaries, which he strongly supports, to the convention delegates.

For a politician who isn’t even a member of the Democratic Party, Sanders has made quite an impression on it. It may not be exactly the victory he was looking for, but it is a victory nonetheless. If Sanders overstays his welcome, he risks turning it into a loss.


Article Link to The Bloomberg View: