Republican leaders have been blunt about their motivation: to deliver on their promises to wealthy donors, and down the road, to use the leverage of huge deficits to cut and privatize Medicare and Social Security.
.. the unexpected and rapid nature of the decline in American national politics, and how one-sided its cause.
.. the Republican Party — as an institution, as a movement, as a collection of politicians — that has done unique, extensive and possibly irreparable damage to the American political system.
Even today, many people like to imagine that the damage has all been President Trump’s doing — that he took the Republican Party hostage. But the problem goes much deeper.
.. we can’t help seeing the Republican Party as the root cause of today’s political instability. Three major developments in the party required us to change our view.
.. First, beginning in the 1990s, the Republicans strategically demonized Congress and government more broadly and flouted the norms of lawmaking, fueling a significant decline of trust in government
.. House Republicans showed their colors when they first blocked passage of the Troubled Asset Relief Plan, despite the urgent pleas of their own president, George W. Bush, and the speaker of the House, John Boehner. The seeds of a (largely phony) populist reaction were planted.
.. Second, there was the “Obama effect.”
.. we saw a deliberate Republican strategy to oppose all of his initiatives and frame his attempts to compromise as weak or inauthentic. The Senate under the majority leader Mitch McConnell weaponized the filibuster to obstruct legislation, block judges and upend the policy process. The Obama effect had an ominous twist, an undercurrent of racism that was itself embodied in the “birther” movement led by Donald Trump.
.. repeatedly promised the impossible under divided party government: that if they won, Mr. Obama would be forced to his knees, his policies obliterated and government as we knew it demolished. Their subsequent failures to do so spurred even more rage
.. Third, we have seen the impact of significant changes in the news media, which had a far greater importance on the right than on the left. The development of the modern conservative media echo chamber began with the rise of Rush Limbaugh and talk radio in the late 1980s and ramped up with the birth of Fox News. Matt Drudge, his protégé Andrew Breitbart and Breitbart’s successor Steve Bannon leveraged the power of the internet to espouse their far-right views. And with the advent of social media, we saw the emergence of a radical “alt-right” media ecosystem able to create its own “facts” and build an audience around hostility to the establishment, anti-immigration sentiment and racial resentment. Nothing even close to comparable exists on the left.
Mr. Trump’s election and behavior during his first 10 months in office represent not a break with the past but an extreme acceleration of a process that was long underway in conservative politics.
.. The Republican Party is now rationalizing and enabling Mr. Trump’s autocratic, kleptocratic, dangerous and downright embarrassing behavior in
.. hopes of salvaging key elements of its ideological agenda: cutting taxes for the wealthy (as part of possibly the worst tax bill in American history), hobbling the regulatory regime, gutting core government functions and repealing Obamacare without any reasonable plan to replace it.
.. The failure of Republican members of Congress to resist the anti-democratic behavior of President Trump — including holding not a single hearing on his and his team’s kleptocracy
.. Only conservative intellectuals have acknowledged the bankruptcy of the Republican Party.
Generation Y Takes Over
But immigration is a subset of a larger global problem. The dominant economic event of our era is the Great Recession, which began in 2007 and ended for the U.S. in 2009. Its status as a “great” economic downturn is attributed to its long aftermath of unemployment and, more important, underemployment.
As the U.S. and European economies failed to achieve pre-recession growth levels, which exacerbated social anxieties, the elites produced an explanation. They called it “the new normal.”
.. The new normal” theory, which in a wink became conventional wisdom among conventional economists and pundits, exists mainly to absolve them—and Barack Obama —of responsibility for weaker growth’s dire effects on national standards of living. What the theory failed to capture is that the new normal creates angry have-nots.
.. Voters everywhere are rebelling against the new normal. They won’t concede its implicit acceptance of flattened opportunities for younger Americans or Europeans still in their prime working years, who don’t have sinecures explaining to everyone else why this is as good as it will ever get. Increasingly, they are voting into office political outliers—from Trump to Macron to Kurz.
.. Mr. Trudeau’s economic plan should be seen as a proxy for what the next Democratic presidential nominee is likely to run on. Influenced by former Obama economic adviser Larry Summers’s theories on “secular stagnation,” Mr. Trudeau is making massive outlays on infrastructure repair and modernization to revive demand inside Canada.
.. Donald Trump is an infrastructure guy, too, but his path out of the new normal’s long-term trap runs mainly through regulatory relief and reforming the U.S. tax system.
.. U.S. firms kept 71% of their foreign-earned profits abroad, “benefiting other nations’ workers.” What would be the effect, Mr. Hassett asked, if for the next eight years, those profits were repatriated and reinvested here through a tax regime designed to promote more capital investment in the domestic economy? Incomes would rise.
Financial Crisis: 10 Years Later With Credit Suisse’s Rothman
Credit Suisse’s Matthew Rothman revisits the beginnings of the 2007 financial crisis with a look at what’s changed in the past ten years, and how today’s market fares in its current climate.
Aug. 9, 2007: The Day the Mortgage Crisis Went Global
A look at the problems exposed by the events that day and what investors, bankers have learned since then
By now it is widely understood that
- the global financial industry was overleveraged, that the U.S. mortgage market was rife with loans that wouldn’t be repaid, that investors and
- financial institutions everywhere were paying high prices for highly rated securities that were actually extremely risky.
.. But at the time that larger meaning wasn’t evident, even to financial industry executives and the central bankers charged with overseeing them. The economy was growing at a near-4% clip and stocks were hitting new highs. Many still believed the mortgage problems would blow over.In the minds of many at the time, what Wall Street began grappling with on Aug. 9 was a liquidity outage in the trading of risky securities, one that might be solved with repeated infusions of central-bank money... On Aug. 9, for instance, a spike in short-term interest rates such as Libor prompted central bankers to spring into action, pouring funds into the market and promising further support. Those efforts were successful—but they didn’t create incentives for capital raising and deleveraging, which is what the markets needed most desperately.