Kamala Harris’messaging on busing out of touch 40 years later

The eye catcher ….

Kamala Harris attacked fellow Democratic candidate Joe Biden during last night’s second round of debates between Democrats vying for their party’s blessing to go up against presumptive Republican nominee Donald Trump in November 2020.  Ms. Harris scored points on Mr. Biden when the U.S. senator from California challenged his position in the early 1970s on school busing.  Ms. Harris asserted that Mr. Biden was against busing, the policy that transferred black students from schools in poor neighborhoods with under-performing, under-funded schools to schools in majority white, more affluent communities.  Ms. Harris argued that were it not for that policy, she would not have enjoyed the personal and professional success she is enjoying now.

From the perspective of a candidate seeking votes in the political markets, does the issue of busing resonate enough with the electorate’s fear that the narrative will garner votes?  The answer is no.

Ms. Harris’ busing argument doesn’t address Americans’ fears …

For millions of Americans, the issue of busing does not pull at the heart strings.  With a median age of 38 years, the policy of busing was waning when half of America was alive.  For the past two decades, cities across the United States have implemented remedial plans to address the problem of school segregation.  Ms. Harris’ mother faced the fear of her daughter receiving a less than stellar education in their neighborhood and likely believed this was the best or only available option.  And while there is still the concern about poor funding in low-income neighborhoods, options, including vouchers, charter schools, private schools, and relocation are available to alleviate these fears.

But while the issue of busing will quickly fade from the memories of the electorate who watched last night’s debate, what may linger a little longer is Ms. Harris’ performance.  The push back on Mr. Biden included a picture of Ms. Harris as a school girl and when combined with the tone and delivery of Ms. Harris’ remarks provided enough of an emotional message to connect with people in the audience and with traders in the political futures markets as the price of an event contract on Ms. Harris’ nomination climbed as much as seven cents last night on PredictIt.

But her performance may not address the fear of some in the black community that her record as a prosecutor does not reflect serious attempts at law enforcement reform.  There is the argument that her record is mixed, having not done enough to address the efficacy of investigating police shootings, declining to weigh in on recreational use of marijuana, and her defense of the death penalty.

Kamala Harris, while probably liked by her sorority sisters and the professional class, may not be endeared by those who have had a less than pleasant run-in with law enforcement.

Conclusion: Kamala Harris has work to do …

Ms. Harris has managed to present energized optics over the past 24 hours, but in the 21st century digital world, those optics can be blurred quickly by opposing messaging provided on tens or hundreds of other mediums.  Right now as I type this post, Joe Biden is mounting an energetic rebuttal to Ms. Harris on C-SPAN and while the political futures markets have Ms. Harris’ selling at a higher price than Mr. Biden, the ability for Mr. Biden to go on a policy offensive across multiple platforms with a deeper bench of media and civic leader support could put him back in the driver’s seat.


The corporation serves the State, not the other way around …

The eye catcher ….

During last night’s debate among candidates for the Democratic nomination for president, a number of candidates including U.S. Senator Cory Booker of New Jersey and U.S. Senator Elizabeth Warren of Massachusetts, criticized corporations operating in various industries for the greed they perpetrate on Americans.  From internet to health care to energy companies, the candidates took issue for predatory prices for health care, the anti-trust implications of large internet companies, and the tax breaks companies receive while rank and file Americans struggle.

In short, corporations should be feared …. or should they?

History of the fear ….

As usual when selling a fear narrative it is important to leave out the education component from any assertion that there is a bogey man to be afraid of.  What consumers of the political narrative should be asking is, “What is a corporation?”  “Why should I be afraid of it?”

corporation is an extension of the State.  A corporation’s purpose is to extract resources, process them, convert them into goods and services, and distribute those goods and services using price as the allocating mechanism in order to generate tax income for the state and private income or profit for itself.

To varying degrees this has been the corporation’s role for the last 400 years.  Americans have been so programmed to believe that America was discovered by adventurous Europeans that they overlook or are simply ignorant about its corporate beginnings.

Prior to the 17th century, corporations, originally not-for-profits that received charters from the British monarch, were established to meet some public works need with their duties overseen by government. During the 17th and into the early 18th century, colonial corporations had the primary responsibility of expanding the British monarch’s empire, creating monopolies and controlling trade.  These companies bought or extracted raw resources, sent then to England for manufacture, and then imported the manufactured goods into the colonies for purchase by the colonists.

Americans have forgotten (if they ever knew) that although their ancestors were miffed by the trade monopolies held by these companies and the economic oppression they contributed to, post the American Revolution, corporations were the structure that drove the private investment into the American industrial revolution.

The problem for American government by the 1820s and 1830s that like the monster from Mary Shelley‘s Frankenstein: or, The Prometheus Man, the corporation sought their own version of self-awareness and increased freedom from the strictures of the State.  It has been a back of forth battle between the State and the corporation, with the State taking a more interventionist approach by stepping up regulation in the areas of banking, energy, securities, and telecommunications.  Corporations had been created to carry out the State’s bidding in maximizing America’s resources.  Intervention via regulation is indication that the State fears that it may lose control over the corporate power it relies on to administer the Nation’s resources.

Spreading the fear to the consumer …

It wouldn’t be good social policy for the State to drop the hammer on corporation monopoly over resources if the sentiment of the public were not incorporated in its policy actions.  The optics of an arbitrary application of administrative power does not fare well in a democracy.  There has to be an excuse and in a democracy the excuse should include a discussion on the harms an unregulated corporation could have on the consumer.

Americans may be uncomfortable with the ability of corporations to engage in predatory pricing, but they have a bigger fear of a government that exercises power on a whim.  One can always substitute the product of a corporation with another product, but one cannot easily get away from a State with a monopoly on force.

To stem the fear of arbitrary and capricious application of force, the State gives the impression of fairness and due process in its rulemaking by asking the public to comment on or, when applicable to the decision, to vote.  The State gets the public to buy into regulation of the corporation by painting the corporation as harmful to the public’s interest.  It makes the corporation the bogey man; the entity that transfers wealth from the consumer to its treasury unjustly via high prices or non-disclosure of prices, terms, and conditions.

Conclusion: To serve the State …

By substituting the fear of consumer abuse for the fear of reduced power over the Frankenstein monster, the State accomplishes to goals. First, it keeps the public in check by holding itself out as a consumer protector. Second, it reminds the corporation of its role in the American political economy: that the corporation serves the State and not the other way around.







The World’s First Corporations

People don’t want freedom. They want to be led …

To pursue political power is to realize that people don’t want freedom.  They want to be led.  To be successful at obtaining and wielding political power in a consumerist society operating in and governed by corporate-capitalist republic, a politician’s approach is to create a narrative that is bought into by the electorate in exchange for votes or policy approval.

Just like I am not allowed to go behind the front counter of my favorite Chinese food restaurant and tell the cooks how to make the egg rolls, the electorate should not be allowed to participate in how policy is made.  Contrary to popular belief and false narratives, republics are not about the participation of the populace in the practice of governance.

Rather, the people’s role is limited to the qualified selection of representatives to its government and the constitutional officers responsible for its day-to-day operations.  Too many cooks in the kitchen, the old adage goes, creates a mess.  Inefficiencies in governance occur when there is little check on the number of stakeholders identified or created.  Nothing will get done.

Take the men and women running for the Democratic Party nomination for president.  Most of their campaign speeches are littered with phrases implying that they are going to “fight for you.”  Never mind that the individuals, government institutions, or corporations that they are fighting against are American.  They never assert that they, the elected official, will show you how best to defend yourself against these enemies.

Telling the electorate that you are fighting for them taps into the fear necessary for getting the electorate in line with a candidate’s leadership.  The empowered are not going to follow fear mongers.  The empowered are going to ask how candidates got in such a position of influence that they believe they can deliver promises of affordable health care, free college education, and monthly universal basic income checks.

The vast majority of the electorate, fortunately, do not have the energy, time, or critical thinking skills to ask these questions that amount to the balance of power between the leader and the led.  An “honest” politician does not want the electorate to be that insightful.  Such queries mount a clear and present danger to a politician’s power.

Instead, the “honest” politician should keep the channel to her message wide open by posting a fear-filled narrative during every opportunity that presents itself.  Issues must be painted as complex and that only the politician’s guidance and expertise need be relied on.  She should continually remind her constituents that they cannot lead themselves.

Quality information: How the political prediction markets serve the political markets

Corporate investors and the political markets …

A corporate investor in the political markets goes long because, unlike a trader who is more short term minded and willing to get out of a contract before an event in the political markets occurs, the corporate investor has “skin in the game” by way of future profits and losses.

In the political markets, where an office seeker sells a narrative to the electorate in exchange for a vote, a corporation is concerned that the office seeker with a message or policy that puts the corporation at a disadvantage may win an election.  Therefore, the corporation will invest in the office seeker, whose policy proposals provide the corporation with a benefit, by financing the most effective ways for promoting the favored office seeker’s messaging.

The corporation’s uncertainty as to which office seeker to back and how well that office seeker will perform in the political markets hinges on the quality of information the corporation receives from the political markets.  The information from the political markets will be skewed, tainted, biased.  The office seeker may relay to the corporation that things are going well on the campaign trail; that town halls are packed; that the electorate is buying the message.  In reality, the office seeker may not have enough volunteer staff in key voting communities; town halls have been cancelled or poorly attended; and the office seeker’s message may not be resonating with voters.  For these reasons, a corporation may rely on the political prediction markets to close the information gap.

The accuracy of information is enhanced in the political prediction markets because the parties trading in these markets have “skin in the game” by purchasing one of two sides of an event contact, i.e. will office seeker A win or will she lose.  Traders are putting their money where their mouths are and to ensure maximum returns on their trade, traders seek out and incorporate the best information they can find regarding potential outcomes.

This information in general is about how an office seeker is increasing her value in the political markets.  For example, what are the messages being pushed by the office seeker? How relevant are these messages? How is the office seeker expending resources? Does the office seeker have an abundance of resources?  Where the answers are positive as to value of the messaging, then the possibility of a favorable event as determined in the prediction markets is also positive.

Conclusion: Both markets compliment each other …

Information is the currency that ties the political markets and the political prediction markets together.  Political prediction markets provide the means for cutting through the noise in two ways.  First, the corporate investor uses information from the political prediction markets to filter out less accurate information.  Second, actual traders in the political prediction markets are seeking out the best information possible and this higher quality information is observed by the corporate investor in the form of prices for each trade in the prediction markets.

It is all about the information…..

Cory Booker is not gaining traction with Black voters. His campaign is drawing to a close.

Just a few minutes ago I noticed a Facebook ad from Senator Cory Booker’s campaign telling voters that Democratic National Committee had raised the threshold for its third debate to donations received from at least 130,000 donors.  In February 2019, a donation threshold of 65,000 donors was reported.

PredictIt has Mr. Booker’s “yes” vote price at two cents.  Since Mr. Booker has qualified for the first debate by meeting the 65,000 donor threshold as well as receiving at least one percent support from voters polled, part of Mr. Booker’s market performance problem may be due to an inability to gain traction with the dominant block of Democratic primary voters: black people.  He is viewed by some in the black community as disingenuous, reports Blue Telusma for The Grio.com.

Until recently lesser known candidates such as Pete Buttigieg and Andrew Yang are besting the U.S. senator from New Jersey and I believe that unless Mr. Booker can at least improve his performance among black voters, he may be calling it quits before the September debates.

The negative factors that Trump must turn around to secure re-election.

The news …

Since the opening of the 2020 U.S. Presidential Vote Share Market contract on 7 February 2019, the Iowa Electronic Markets has Democrats taking the greater share of votes in the November 2020 presidential elections.  The purchase price of a win by the Democratic presidential candidate has increased by 15.2%, from $.50 per share on 7 February 2019 to $.576 per share as of 17 June 2019.

Meanwhile, the price of a win by the Republican presidential candidate has decreased by 4.71%, from $.467 per share on 7 February 2019 to $.445 per share as of 17 June 2019.

With just over 16 months left until the general elections, there is still time and opportunity for changes in these prices, driven particularly by who is chosen by the Democratic party to vie for the presidency.  During this time period the expected Republican nominee, President Donald Trump, will be expected to work on the negative aspects of his narrative given his unpopularity among the American electorate.  Here are some negative factors that traders in the political prediction markets should expect to see Mr. Trump to make an effort to improve on.

Mr. Trump’s overall approval rating and the areas he has to target….

After 860 days in office, Mr. Trump’s approval rating is at 40%, according to Gallup poll data.  But as Shannon Pettypiece and Mike Dorning point out in a piece for Bloomberg, no president since 1952 has won re-election polling under 48%.  Mr. Trump, according to the article, has never polled above 46%.

To start driving up the value of his electoral stock, Mr. Trump’s management team will have to reassure farm states like Iowa that his trade policies will eventually pan out for them.  Politic prediction market traders should be concerned if they see no movement in this area.

Another area, more along the line of political optics, is Mr. Trump’s activity on Twitter.  As Ryan Girdusky notes, Mr. Trump’s addiction to Twitter is “toxic.”  Both Democrats and Republicans want Mr. Trump to stop using the micro-blog service.  His detractors and some of his supporters express that Mr. Trump’s Twitter activity makes him look petty.  Mr. Trump pushes back on this argument by asserting that social media is an effective way of communicating his policy positions.

Traders should be looking for changes in this political behavior over the next few months as the change in optics may be reflected in prices.

Mr. Girdusky also adds that Mr. Trump has a media problem and that whether stories are true or baseless, the media paints him as corrupt, incompetent, or both.  Mr. Trump’s activities feed this perception.

While the economy is strong, with unemployment falling below the historic full employment rate of four percent, the 2017 tax cut that Mr. Trump credits with spurring economic growth is viewed as unpopular by most Americans, writes Ben White of Politico.  The majority of Americans don’t believe they benefited from tax relief under the law.  Again, Mr. Trump will have to use the next few months persuading the American public that their perception is wrong.

One last area traders will have to look for movement on by the Trump team is the President’s perceived embrace of bigotry.  Marc Thiessen raises the point that the public is not enthused by the Trump administration’s policy of separating children from their families.  In addition, Mr. Trump has, according to Mr. Thiessen, not done enough to separate himself from “ethno-nationalists.”

Searching for the “surprise”….

The new information that traders should be looking for is political behavior on the part of the Trump campaign that seeks to turn the above negative factors onto positive ones; that describe the factors either as strengths or transmitting benefits to the electorate.  Mr. Trump will have to be seen as spinning these narratives into political packages the electorate is willing to purchase with the vote.






Blacks need a new political law game

The political battle between the Executive and the Congress has been intense to say the least over the last twenty-seven months since Donald Trump took office.  With post-Mueller report hearings ramping up next week, the saga only promises to continue way into campaign season.

My friends and family have expressed varying degrees of interest, with a significant number of opinions fueled more by emotion and less by critical thinking.  For example, the constant reference to “collusion”, a term that has no legal meaning, is disconcerting because it provides an example of how people are ignoring the particulars (even when readily available for examination) and rolling with the globs of misinformation thrown onto the plate most times by the mainstream media.

Black congressional leadership wasting political power …

What should also be disturbing is how two of the highest ranking blacks in the Congress, Maxine Waters and Elijah Cummings, are spearheading the charge in the impeachment debate.  Their distaste for the sitting president is evident, but what is less evident is how the use of a potent political law instrument as impeachment is supposed to translate into any increase in political power, wealth, or capital for black people.

If anything, House Speaker Nancy Pelosi has expressed caution about pursuing impeachment, appreciating the argument from some inside her party that pursuing impeachment could have a negative impact on the Democrats’ ability to oust Donald Trump from the Oval Office in November 2020.  Mrs. Pelosi’s hesitancy on impeachment should have provided Ms. Waters and Mr. Cummings an opening to show leadership and go against the impeachment grain, not because it would be in line with Speaker Pelosi’s sentiment, but as a signal that the energy expenditure behind impeachment does nothing for their prime constituency: black people.

When you are marginalized, you agitate …

With at least 51 voting members in the U.S. House, blacks in the Congress are in a position to be the pivotal swing vote on a number of issues including impeachment. Numerically, black members of the House, where articles of impeachment would originate, could clog the wheel by holding back approximately 20% of the Democratic vote.  With this leverage, black congressmen could attempt concessions from either the House leadership or from President Trump, though it is less likely that the black caucus would try to negotiate with the President for fear of becoming a pariah in the Democratic Party.

Therein lies a telling dilemma. If the premier block of black congressmen cannot leverage numerical strength without fear of reprisal, what good is their strength?  Another irony is that for a group of congressman that represent a marginalized group, their fear of marginalization within Congress does not put them in a position to do more for their black constituents.

Maybe the answer is to stay outside the box …

On the other hand, maybe blacks, particularly those who embrace their status as marginalized, need an approach to political law that allows them to carve out their own independent niche; one that unapologetically finds the seams or openings in the political economy in order to access capital or create substantive platforms for constructing true communities. Current black leadership is too afraid to do that.