Social Security Set to Rise 0.3%

The Social Security Administration announced today that social security benefits would be increase 0.3% in 2017 to account for cost of living adjustments. This amounts to about $60 per beneficiary per year. Social Security is often times considered a “third rail” topic as it directly impacts a very large, politically active group of voters.

At some point in time, though, Social Security is going to have to be addressed by the United States. There aren’t enough workers paying into the program to guarantee the long-term solvency of the fund and the benefits received by retired workers – in numerous cases their only retirement funding – are near poverty levels.

Bernie Sanders’ voiced his displeasure with the increase, projecting an expansion of the program.

By expansion of the program, Sanders and many progressives actually mean removing caps from the employee and employer contributions going into the fund. I disagree with this approach as it disproportionately impacts small business owners who are responsible for both sides of the tax, currently at 12.8%.

What the United States really needs is to scrap the entire system and start over. In my mind, the idle system would shift toward a public-private model that protects low and middle income workers by allowing them to build a inheritable asset.

The execution of this idea – a subject for a more detailed report in the future – would include the following:

  • Worker contributions to a private account
  • Public-private return guarantees
  • Fee-free support

Again, the full idea will be available at a future date, but we must begin to start thinking about new institutions, not further funding broken programs.

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The Democrats May Have a Voter Problem

Lost in the talk about Trump crushing Marco Rubio in his home state of Florida is any discussion surrounding the number of people who actually turned out to vote in the Republican Primary.  This may come as a shock to some given the general excitement around candidates like Bernie Sanders on college campuses, but Donald Trump received 1,077,221 votes to Hillary Clinton’s 1,097,400.

So what, he would have lost, right?

Not so fast.  Total votes for the Democrats came out to be 1,702,878 broken down as follows:

Clinton: 1,097,400
Sanders: 566, 603
O’Malley: 38,875

Whereas the Republicans had approximately 2,355,183 votes cast for GOP candidates, broken out as:

Trump: 1,077,221
Rubio: 636,653
Cruz: 403,640
Kasich: 159,412
Bush: 43,452
Carson: 21,163
Others: ~12,000

There is an old saying in politics that is going to be very important for this election:

Democrats fall in love, Republicans fall in line

This saying points to the Democrat’s issue, what will Bernie Sanders voters do?  The majority of his voters right now are young and idealistic.  They view the establishment in much the same way that Trump supporters view – with extreme frustration – so there exists a very real scenario where a significant number of his supports either write Sanders in or don’t vote at all.

That could absolutely sink the Democrats in critical states like Florida (Remember, President Obama only defeated Mitt Romney in Florida by about 0.9% of the vote).  Trump being able to match Hillary when competing against far more opponents is incredibly important.  If the above saying holds true, a lot of these voters will “fall in line” and vote for Trump in the general election regardless of who their current choice is.

Combine that with half the country’s feelings toward Hillary Clinton and there is a very real possibility that Donald Trump takes the White House.

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Post-Caucus: How Close It Was!

The Iowa Caucus proved to be more of a thrill ride than anyone expected.  The Clinton-Sanders margin was almost negligible and the GOP had 3 candidates taking the majority of the Republican votes.  In yesterday’s prediction thread we stated that Ted Cruz and Bernie Sanders would be Monday night’s victors.

Ted Cruz did in fact win with Donald Trump taking second place (also predicted) and Marco Rubio taking third place.  Rubio’s strong showing was not expected in Iowa as the Evangelical population pointed more to a strong Ben Carson showing (who finished forth with around 10% of the vote and was our predicted 3rd place finisher).  Rubio’s win was bolstered further by a key endorsement from Tom Scott.  This result for Rubio will likely lead to a major jump in the national polls.

The most disappointing performances within the GOP had to come from Rand Paul and Jeb Bush.  Rand’s father Ron finished in third place during the 2012 Iowa Caucus and there was some thought that he would capture a bit of that magic.  At fifth place with only 4.5% of the vote, the Paul campaign has to be frustrated by their candidates inability to grab real traction within the party.

For all of the disappointment felt by the Paul campaign, the Jeb Bush camp must be in outright panic.  With millions of dollars spent and coming off his strongest debate performance yet, the early GOP favorite had to expect better than 2.8% of the vote.  We may be seeing the last days of the Jeb! experience.

In all, don’t expect the GOP candidates to throw in the towel before next week’s Primary in NH.  NH tends to be more friendly to establishment / moderate Republicans, many of whom were at the bottom of this poll.  After NH, though, we expect several campaigns to close up shop.

For the Democrats, the story got interesting in Iowa.  Martin O’Malley – debt strapped and with little support – suspended his campaign.  O’Malley is often rumored to be interested in a VP nomination, but that may be in doubt now that the Democrat Party has seen what he would actually bring to the table.  Staying in this race through the Iowa Caucus may have hurt O’Malley’s political career more than it helped.

Clinton narrowly defeated Bernie Sanders in a state that she had a decent lead in before the votes were cast.  While this is a technical win for Hillary, it was also a spiritual win for Sanders, though it was not without controversy.  No other candidate has come from the fringe to the mainstream like he has and with a monster lead in New Hampshire, he is going to force Clinton to play major defense over the coming weeks.

One additional point of note about the Democrat voters shown during the CNN broadcast was the difference in voter profiles between those who chose Clinton and those who chose Sanders.  The voters that valued “experience” overwhelmingly chose Clinton, while those that wanted “someone who shares my values” overwhelmingly chose Sanders.  Look for this information to be used by both campaigns going forward.

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Prediction – Iowa Winners Will Be: Cruz and Sanders

The big day is finally here.

Iowa again marks the beginning of a new beginning (as President Obama cannot run for office again) and with that, Americans will be subjected to an exhaustive gauntlet of campaign ads, calls, and donation requests.  Iowa also marks the point when we, as Americans, start to get some real data about who the next leader of our country will be.

Prior to actually voting for someone, all we have had to go on are the polls conducted by research groups and media organizations.  While these polls give some insight into the general state of mind of American voters, we have also seen that one debate performance can launch a candidate into a leading position for a time being.

This is especially true with the leaderless Republican party.  Through the summer and fall, Republican voters have acted like middle-school children trying to figure out who they wanted to date.  First it was Bush, then Fiorina, then Carson, and now Cruz (all while maintaining a huge crush on Donald Trump).  None of these “picks” lasted longer than a a few months as the spotlight tends to reveal the truth and subsequently forcing those candidates back down the charts.

So who will win in Iowa?

For the Republicans, the winner with be Senator Ted Cruz.  Looking at maps of previous caucuses in the state, it becomes obvious that Iowans love both Evangelical and Libertarian leaning candidates.  Rick Santorum and Ron Paul, being the best examples.  Cruz represents both to some extent and is also currently tied with Donald Trump in the national polls, lending to votes by name recognition.  Second place will go to Donald Trump and third place will go to Ben Carson, who remains very popular with the very religious.

For the Democrats the race is less a race and more a head-to-head competition.  Hillary Clinton leads Bernie Sanders going into today’s caucus (though the difference is close to margin of error).  Sanders, though, has a message that has been building quite dramatically over the past 6 months and strong support from millennial voters.  If (and here we are assuming they will) those millennial voters turn out, Sanders will narrowly win Iowa.

Image

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When Do the Emails Become an Issue?

With the latest reports out of Washington, DC indicating that the FBI is running a far more thorough and rigid investigation than is being publicly reported, when does the DNC start to panic?  The Clinton’s are powerful and have survived a litany of scandals over the years, but formal charges against HRC may be insurmountable.  There has to be a backup plan.

Is it Bernie Sanders?  Is it Michael Bloomberg?  Al Gore?  Nothing would serve to put Donald Trump into the White House faster than NOT having a very legitimate backup plan.  And right now it seems the coronation that the DNC had planned out back in May could very well be blowing up in the organization’s face.

HRC and the DNC need both a strong showing this week and to they need to assure the base that all is well going forward.  If Trump is right about one thing (only) it is that America hates losers.

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Hillary Clinton’s Campaign Nearing Defcon 1

With the latest information regarding Hillary Clinton’s private email server showing that there was indeed classified materials in the contents, one has to wonder how much longer merely “damage control” will work for the Clinton campaign.  Noted in the New York Times, two of the emails amongst the tens of thousands were even flagged as “Top Secret” by Federal investigators.  While there are still questions about how these classifications were derived, the story is not following the path that Clinton’s team laid out at the beginning of the year.

Not to be outdone, however, Clinton has remained defiant in her defense of the use of the private email server.  While this public show of confidence may play towards many of Clinton’s supporters, there are now many whispers among the Democratic Party worried about crumbling foundation.

What was called, just three months ago, a coronation, is now beginning to be a search for another candidate.  Bernie Sanders may not appeal to mainstream, moderate voters yet so perhaps the field is clearing for someone such as Vice President Joe Biden or former Vice President Al Gore.

If either one of these individuals tossed their hat in the ring, it could spell the end of Hillary’s run.  That has to have Clinton’s people in a panic internally.

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Georgetown University’s Jobs Report Highlights the Need for Skill-aligned Education

new report released by Georgetown University’s Center for Education and the Workforce shows that the American recovery has created more high (>$53,000) and middle ($32,000-$53,000) wage jobs than previously estimated.  These findings stand in contrast to previously reported figures that indicated the majority of new jobs were in low wage positions.  The report also notes that the US workforce continues to be short 900,000 middle wage jobs when compared to the recession – which were primarily manufacturing positions that were shipped overseas.

While this report is encouraging in its own right, it also highlights the continued need for post-High School skills alignment programs.  These are the programs that build skills in trades such as electrical work, plumbing, welding, and other fields.  Many companies have noted a lack of workers with the right combination of trade skills to fill open job opportunities across the country.

For a long time the promise of a better future has been tied to a college degree.  Public High Schools have pushed this agenda, at all costs, as the “single best way” to a happy future – despite many students being uninterested in many college programs or unable to afford college tuition (usually both).  The result has been an expansion in the number of individuals with college degrees that do not work in a field related to their degree and a significant amount of student debt (Over $1 Trillion).

Mike Rowe, host of CNN’s Somebody’s Got To Do It, reflects on the hard, but lucrative careers that are often overlooked by society.  He also highlights a truth: not everyone is cut out to be a Software Engineer or Project Manager in an office setting.  Many would rather get their hands dirty and build something.  American should embrace this opportunity.

Presidential candidates, like Bernie Sanders, will touch on making college more affordable to the average American, but it is our opinion that the focus should be on broadening the range of “acceptable” post high school choices for individual students to pursue.  A choice to attend a trade program at a community college should not be viewed as a lessor choice when compared to attending a 4-year degree program.

Additionally, we believe that the Government and private businesses should work more closely together with educational institutions to project and fund skills training programs.  A program that aligns projections with rapid training/re-training programs will help reduce the impact of shifts in the global economy.

The country needs skilled workers and both the Government and the private sector have a responsibility to develop the talent pool.  Growing the number of middle wage jobs should be priority number one for any Presidential candidate and the best way to do this is to be willing to partner with the educational and business communities.

Image: Welding Answers

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Back Door Gore?

Life, they say, is all about timing.  Just a few months ago the pundits had all but completed paving the road to the White House for Hillary Rodham Clinton.  What was once called a “coronation” is now a campaign in damage control.  Email server controversy, likability falling like a stone in the ocean, and the meteoric rise of Bernie Sanders all have Democrat leaders scrambling.

In contrast to the Republican Party’s never-ending list of Presidential candidates, the Democratic field is wide open.  Only Clinton and Sanders, at this point, have looked like legitimate contenders for the nomination (Lincoln Chafee is not the horse to hitch the party wagon to).  This has created an opportunity for a well-established, well-connected, and well-financed individual to swoop in and take the nomination, along with the White House itself.

So enter Al Gore.  Since losing the 2000 coco_gorePresidential Election to George W. Bush, the former Vice President has stayed, for the most part, out of politics.  What he has done over the past 15 years is write books, produce movies, and give numerous speeches about saving the environment, all while building a folk-like hero status among his supporters.  A strong Democrat, yet moderate on more mainstream issues, may be viewed as a better nominee than Bernie Sanders if the Clinton campaign goes down in flames.

Whispers of a potential entry by Al Gore may just be the wishful thinking of some Democrats who have soured on Clinton and find Sanders too extreme.  A spokesperson for Gore downplayed the rumors say that they were “groundless,” but as we have seen time and time again, where there is smoke, there tends to be fire.

Gore, now 67, would need to move quickly to build a campaign team and find donors to his cause.  It is not too late yet, but this window of opportunity will close faster than in previous elections.  Top-tier candidates are expected to raise hundreds of millions of dollars and getting a late start will put any candidate at a significant disadvantage.

For some Democrats, Al Gore may be the party’s only hope.  The extent to which  this former political titan shifts the balance of power in the Democratic Party will be one of the main stories of the election.  It is certainly one that we will be watching.

Image: Team Coco

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Trump, Sanders Lead in New Hampshire Polls

Knowing that this election is a marathon, not a sprint, it is still important to check into the early primary states to see how candidates from both parties are polling among potential voters.  For the Republicans, the story hasn’t changed: Donald Trump (18%).  For the Democrats, strong showings across the country by Bernie Sanders (44%) have propelled him in front of projected favorite Hillary Clinton.

Here is a full look at the Republican field:

GOP_NH_Graphic_2015_08_12_2

These polls tend to be reflective of headline grabbers which both Trump and Sanders have dominated over the past few weeks so readers should calibrate appropriately.  There are some conclusions that we can begin to draw:

  • Gov. John Kasich benefited the most from the GOP Debate (we are calling it the Trump-Bump)
  • Democrat voters are showing themselves to be far more progressive on key issues than in previous elections
  • Hillary’s coronation may not play out the way she has wanted it too, but she also hasn’t gotten started

 

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Bernie Sanders Speech Stopped by Protesters

In Seattle, a planned speech by Bernie Sanders was disrupted by protesters from the #BlackLivesMatter organization.  Fortunately for all parties involved there was no violence initiated by either side, but for the Sanders campaign, this disruption must be extremely frustrating.

Senator Sanders has regularly positioned himself as a champion of social issues and reform – even organizing a sit-in as a student in college to protest segregation in campus housing.

sanders_sitin

Not all was lost for Sen. Sanders’ west coast trip.  Later in the day, the Senator spoke to a crowd of 12,000 at the University of Washington where he addressed the earlier rally issues:

No president will fight harder to end institutional racism and reform [the] criminal justice system.  Too many lives have been destroyed by war on drugs, by incarceration; we need to educate people. We need to put people to work.

The Senator from Vermont has shown an incredible level of consistency throughout his campaign with clear, direct messaging detailing his vision for America.  The progressive-liberal agenda has resonated with millennial voters at a similar level to the support enjoyed by Libertarian-Republican Ron Paul in the 2012 and 2008 elections.

Even if this support is not sufficient enough to secure the Democratic nomination, Sen. Sanders has already shown that a Clinton campaign will not merely be a coronation.

Sen. Sanders will be speaking in Portland, OR and Los Angeles, CA to round out his west coast trip.

 

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