THE BASIS POINT

Fate of Democracy & Markets In America’s Contested Election

I consume the bulk of my political news in two ways: financial media and humor. The former reduces chatter to outcomes, the latter offsets toxicity, and both require deep expertise. That’s why The Economist’s take on a contested election hits hard. They always examine long-game outcomes, and believe an American contested election bodes ill for democracy globally.

Yeah I get this is a no-brainer to the politically anxious. But when a highly measured voice presents this outcome, it becomes much more stark for me.

Here’s The Economist on America’s contested election in 2000 vs. a contested election in 2020 amidst pandemic and voter rage:

At this distance, it is easy to forget quite how wrenching a disputed presidential election was in 2000. And that dispute took place at a time of maximum American self-confidence, before 9/11, before the rise of China, before elections were fought on social media, and when the choice was between two men who would be considered moderate centrists by current standards.

Now imagine something like the Florida recount taking place in several states, after an epidemic has killed 200,000 Americans, and at a moment when the incumbent is viewed as both illegitimate and odious by a very large number of voters, while on the other side millions are convinced, regardless of the evidence, that their man would have won clearly but for widespread electoral fraud.

This is spot on. I remember everyone’s high tension from 2000’s contested election. And that environment was lightyears less severe than the blood in the streets we already have in 2020.

And for those who forgot or were too young, here’s a recap of nefarious policymaking that went down during 2000 contested election chaos:

– On December 12, 2000, Washington went into a frenzy when the Supreme Court ruled for George W. Bush over Al Gore in the Florida recount.

– On December 15, GOP senator Phil Gramm slipped a 262-page Commodity Futures Modernization amendment into an unrelated spending bill which passed.

– This utterly exempted credit derivatives from regulation by the SEC or CFTC. It enabled energy derivatives that led to Enron’s spectacular scandal in 2001 and mortgage derivatives that caused the global financial crisis in 2008.

Related: Phil Gramm’s wife Wendy Gramm led the CFTC from 1988-1993, then joined Enron’s board and served on it’s audit committee. Deregulation long game.

In this 2000 example, the playbook used momentary contested election chaos for nefarious financial policymaking. Today, the playbook is to create daily chaos for nefarious policymaking of all sorts.

And to delegitimize non-executive branches of government, the media, elections, anyone with opposing views, and democracy itself.

Meanwhile social media — whether you realize it or not — has forced us to become more married to our views.

Think about it: you put something out on social, get some engagement, then then you dig in. Even if you change your view later, you’re now like a politician who’s record is out there. You think it’ll be used against you if you change, so you dig in deeper.

Plus if we spend our days being fed by social algorithms, then we only see reinforcing views and are shielded from opposing views.

It’s all very toxic, and a contested election will just make it worse.

Which brings me back to consuming political news via humor.

This week, journalist Bob Woodward released tapes of Trump downplaying COVID’s severity and saying that being aware of racial justice is just “drinking the Kool Aid.” Yet somehow Woodward is under fire instead of Trump for not releasing the tapes earlier.

Here’s The Onion on Trump/Woodward:

“In my defense, I only kept this damning interview with the president from the American people because it’s not going to make any difference whatsoever,” said the reporter famous for breaking the Watergate scandal, adding that he has filed hundreds of hard-evidence-backed stories on the myriad unspeakable things Donald Trump has said and done in the past four years and none of the articles resulted in a single consequence. “Trust me, I would have released this tape of Trump openly brushing off the deaths of hundreds of thousands of Americans back in February if we lived in a world where ironclad evidence of the president’s dishonesty would lead to repercussions–but we don’t.”

Expert analysis indeed.

Sometimes all we can do is laugh.

And vote.

If you want to get into the weeds on contested election scenarios for 2020, see link 3 below.

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Reference:

America’s Ugly Election – a disputed result could be dangerous

COVID, distrust, and an almost certain contested election pose grave risks to America

Preventing A Disrupted Election & Transition In 2020 – white paper by bipartisan Transition Integrity Project

“I don’t take responsibility at all” isn’t Trump’s downfall. It’s his greatest strength.

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