Column: What's behind the Democrats' power play
Democrats are rushing into impeachment despite the knowledge that, given what we know now, the Senate will not remove Donald Trump from office. Why is Nancy Pelosi doing this?
Because she has resigned herself to the argument that impeaching Trump is the way for Democrats to win the presidency and Senate 13 months from now. Pelosi’s bank shot isn’t aimed at Trump’s conviction on the Hill. It’s aimed at his loss at the polls.
American University professor Allan Lichtman best expressed the political logic in a recent op-ed. His “13 keys” model, along with most quantitative forecasts, currently favors Trump’s reelection. Lichtman says impeachment would change that by tarnishing the incumbent with scandal. The facts of the case, and whether the Senate convicts, do not matter.
Impeachment alone would not doom Trump according to Lichtman’s model. What it might do is trigger additional events that would help Democrats. The cumulative effect would be a Republican loss.
The conventional wisdom that impeachment backfired on the Republicans in 1998 has been overturned. Yes, the argument goes, the GOP gave up some House seats. That did not stop them from winning the presidency and both chambers of Congress two years later. Impeachment contributed to “Clinton fatigue.” It boosted the chances of a candidate who promised to restore dignity to the White House. The same could happen in 2020.
Advocates of impeachment say the inquiry, whether an official “proceeding” or not, might damage Trump’s approval rating to such an extent that he will draw forth a significant primary challenger, a third-party candidacy, or both. Nor is political tumult and uncertainty helpful for a global economy roiled by trade war and lack of investment. Recession would make Trump’s downfall even more likely.
If impeachment comes to a vote in the House, Democrats representing Trump districts will be risking their political futures. Pelosi seems willing to take that risk. She knows this knife cuts both ways.
Mitch McConnell says that if the House votes to impeach, the Senate will hold a trial. It won’t just be Democrats Doug Jones (who is in cycle) and Joe Manchin, Jon Tester, and Kyrsten Sinema (who are not) in awkward positions. So will Republicans Susan Collins, Martha McSally, Cory Gardner, and Thom Tillis, all up for reelection. Democratic victory in the Senate is critical for progressives. McConnell is Horatius standing between Elizabeth Warren and structural reform of the Senate, the judiciary, and the U.S. economy.
Pelosi has fixed impeachment on the July 25 phone call between Trump and Ukrainian president Volodymyr Zelensky for three reasons. The scandal fits on a television chyron: “Trump pressured Ukraine for dirt on Biden.” The process can be run through her ally Adam Schiff’s Intelligence Committee rather than through the obstreperous Jerry Nadler’s Judiciary. And the national security connection provides cover for the seven moderate freshmen with backgrounds in defense and intelligence agencies.
What makes Ukraine different from the Russia investigation is the simplicity of the alleged wrongdoing. Everyone can read the transcript of the Trump-Zelensky phone call and decide whether its contents warrant impeachment and removal from office in an election year. The Democrats need to move quickly, however, and maintain focus. Otherwise they risk losing the plot.
Speed is essential if Ukraine is to avoid the fate of other supposedly Trump-destroying scandals that collapsed from either a dearth of outrage or internal contradictions. Stormy, Avenatti, Omarosa, Scaramucci, Cohen have all gone the way of the dodo. The Russia investigation was too confusing, its results too murky, its special counsel too confused to end or cause lasting damage to Trump.
For Ukraine to be different, the Democrats must uncover evidence that will convince independents and some Republicans the president abused his office. That hasn’t happened yet. Already there are signs of overreach: the attempt to rope in William Barr and Mike Pompeo, tenuous arguments that the Zelensky call somehow broke the law, and calls for canceling Rudy Giuliani’s media appearances and for shutting down the president’s Twitter feed. Pelosi is moving quickly under the assumption that the longer the process takes, the more opportunities Trump will have to wriggle out of this vise, and the more Democrats will become distracted and dissolute.
“How can I lose?” asked Paul Newman’s character Fast Eddie in The Hustler. Pelosi might ask the same question as she enters her own high-stakes tournament. Eddie thought he had a pretty good bank shot, too.
Average retirement account would lose $20,000 to tax
A financial transaction tax, though popular with 2020 Democrats, would raise little revenue and substantially shrink the U.S. economy, a recently released report concludes.
A transaction tax takes a percentage from financial trades, such as the sale or purchase of stocks, bonds, or derivatives. The United States levies an extremely small charge on each transaction to fund the Securities and Exchange Commission. A number of Democrats would like to bring a full-fledged financial transaction tax (FTT) back for the first time since 1965.
The idea’s most vocal proponent is presidential contender Sen. Bernie Sanders (I., Vt.) who has introduced a plan to charge a 0.5 percent fee on financial transactions. Sanders has made the tax “on Wall Street” a central revenue source to pay for his exorbitant spending proposals.
Sen. Elizabeth Warren (D., Mass.) introduced her own FTT proposal in 2015, Sen. Kamala Harris (D., Calif.) wants one to pay for expanding Medicare, and Mayor Pete Buttigieg has also said that he is “interested in” implementing an FTT. Congressional Democrats have supported the idea outside of the campaign trail. Sen. Brian Schatz (D., Hawaii) has his own0.1 percent proposed FTT — the bill has more than 200 co-sponsors in the House, including Rep. Alexandria Ocasio-Cortez (D., N.Y.).
These Democrats and others cite several justifications for an FTT. The tax is aimed at “Wall Street,” a preferred target of populist liberals—at least in principle, that means it also falls more heavily on those who hold a lot of wealth in investments. Additionally, such a tax would impose major restrictions on so-called high-frequency trading, which involves computer-run trades at fractions of a penny—profits that could be wiped out by the tax.
“This Wall Street speculation fee, also known as a financial transaction tax, will raise substantial revenue from wealthy investors that can be used to make public colleges and universities tuition free and substantially reduce student debt,” a brief from Sanders’s office reads. “It will also reduce speculation and high-frequency trading that is destabilizing financial markets. During the financial crisis, Wall Street received the largest taxpayer bailout in the history of the world. Now it is Wall Street’s turn to rebuild the disappearing middle class.”
The scope of the tax, however, would extend beyond the confines of Manhattan, according to a report from the Center for Capital Market Competitiveness, an affiliate of the Chamber of Commerce. The report argues that FTTs shrink the economy and hurt every-day Americans, not just Wall Street fat cats.
“Main Street will pay for the tax, not Wall Street,” the report argues. “The real burden [of an FTT] will be on ordinary investors, such as retirees, pension holders, and those saving for college.”
Much like a sales tax, the costs of a financial transaction tax would be passed on to consumers, who would pay more for each trade. Taxing transactions does not just drive up costs for the ultra-wealthy, but the 6 in 10 American households that own some kind of investment. Increased costs would have substantial effects on American savings. Under the Sanders plan, for example, the report estimates that a typical retirement investor will end up losing about $20,000 on average from his IRA.
These direct effects are arguably less significant than the overall effect that an FTT would have on the financial side of the economy. As multiple Democrats have acknowledged, the goal of an FTT would be to crack down on complicated financial instruments, such as high-frequency trades, to reduce what they perceive as dangerous market instability.
These instruments mostly serve vital functions greasing the wheels of the economy, according to the center’s report. An FTT would erase the razor-thin margins on which market makers operate, and severely constrain other forms of arbitrage. They would also reduce the use of vital risk-management tools, like many derivatives and futures contracts.
An FTT, the report argues, would thus serve to substantially slow the economy. Trade volume would fall; consumer good prices would rise; municipal bonds would generate less revenue for infrastructure; the cost of credit would increase, making mortgages more expensive—in turn exacerbating the homelessness crisis, depressing young home-ownership, and reducing family formation.
Obviously, each of these effects may not be massive—the U.S. economy grew substantially even during the 50-year period when we had an FTT. But, the new report argues, the experience of other nations indicates that the costs to the economy would substantially outweigh any benefit.
For example, they cite an economic analysis of a proposed 0.1 percent transaction tax in the EU—the authors found that “such a tax would lower GDP by 1.76 percent while raising revenue of only 0.08% percent of GDP.” Sweden’s 1 percent FTT caused a 5.3 percent drop in the Swedish market—meaning a 0.5 percent FTT, as Sanders proposes, would analogously cut nearly $800 billion from U.S. market capitalization. The evidence runs the other way, too: In the year following the repeal of the U.S. transaction tax, New York Stock Exchange trade volume increased by 33 percent.
All of this is why many countries—including Spain, the Netherlands, Germany, Sweden, Norway, Portugal, Italy, Denmark, Japan, Austria, and France—have eliminated such transaction taxes.
“Bad ideas have a habit of coming around again. The U.S., like many other nations, experimented with an FTT and wisely got rid of it. Yet each generation seems to be tempted by the false promise of a painless revenue stream,” the report said. “It would be wise to pay attention to the wisdom of experience and again avoid this false temptation. After all, those who fail to learn from history are doomed to repeat it.”
By now a lot of professional Democrats—campaign consultants, party leaders and the like—are probably wishing they’d never heard the term “big, blue wave.” It set expectations so high for the next election that almost any outcome short of a total rout of the GOP will go into the record books as a disappointment.
If the parties fight to a draw—GOP ends up in control on both sides of the Capitol with a diminished majority in the U.S. House of Representatives and better numbers than it currently enjoys in the U.S. Senate, and the number of Republican governors and GOP-led state legislative chambers does not change appreciably (which is how things would probably turn out were the election held today)—then the Democrats will have been seen to have suffered a major defeat.
Nancy Pelosi, Chuck Schumer and other leading Democrats had hoped to nationalize the election by making it a referendum on President Donald Trump’s first two years in office. They may still get the opportunity to do that—Trump, as the events on the U.S. border with Mexico reminds us, is often his own worst enemy. Nevertheless, most of the news is good as the economy has roared back to life and Continue reading
by Michael Bastasch • Daily Caller
Sen. Tim Kaine conveniently left out Democratic nominee Hillary Clinton’s ties to a Russian state-owned energy company when attacking his Republican opponent at Tuesday night’s debate.
“It is clear he has business dealings with Russia and is very connected to Putin,” Kaine said of Republican nominee Donald Trump’s business dealings, according to the debate transcript. “The Trump campaign management team had to be fired a month or so ago because of those shadowy connections.”
Kaine repeatedly attacked Trump and Republican vice presidential nominee Gov. Mike Pence for calling Russian President Vladimir Putin a “better leader than president Obama.” Continue reading
Enthusiasm, Ground game, Undecideds, Indicators, Issues
by Fred Barnes
November 5, 2012
Mitt Romney will win. The tie in the polls goes to the challenger. Here’s why:
Enthusiasm. It matters enormously, and it’s disproportionately on the Republican side, in good measure because of an intense desire to defeat President Obama. True, enthusiasm doesn’t guarantee an edge in turnout, but it’s certainly a key indicator. “In these final days, turnout is driven by intensity,” says Republican pollster Ed Goeas. The nearly half the electorate that strongly disapproves of Obama’s performance in office “will need little else other than the opportunity to vote against President Obama to motivate them to go to their polling place.” Goeas conducts the bipartisan Battleground Poll along with Democrat Celinda Lake. Continue reading