Saturday, April 30, 2016

Tom Clancy's The Division Review

Xbox One UK
I'm very interested in the dynamics of apocalyptic disasters. Currently, I'm going through an online college course about that exact this semester. They range from natural to biological and I have always found the latter more interesting. Epidemics like the Bubonic Plague and the Spanish Flu have existed in history and greatly threatened world order and society. Unlike earthquakes and tornadoes, diseases are the true monsters. They can spread fast across our globalized world by plane or ship to an entirely unaware population. When the signs are clear, it might already be too late as death takes over. With the infection spread, millions could be sick and dying in hospitals run by declining staffs. Lower populations mean a collapse in everything from economic growth to national stability. Anarchy is bound to spread as the government struggles to maintain order.

The video game Tom Clancy's The Division is a perfect example of what happens when a highly dangerous disease spreads through an urban center. You play a customizable character who is part of the Division, an emergency group of previously unknown government agents ordered into New York City following a horrifying epidemic. The efforts of the government's Joint Task Force (JTF) have failed to save America's largest city. The attempt to contain the disease in the "Dark Zone" failed spectacularly and the evacuation has been halted for weeks leaving many civilians stranded. Gangs now roam the streets aiming to take over the city. Some are on a mission to "cleanse" their home by killing everyone in order to prevent the spread of the virus, while others are more intent on creating their own new order. The job of player is to help the government establish stability in the city, fire up the downed power grid, and start research on virus as soon as possible. It is known that the disease started in the heart of the city during the shopping season before Christmas.

I love the RPG experience of the game. As I traveled down the streets of a decaying Big Apple, every aspect of an apocalypse was there. Abandoned cars and barriers are littered throughout the city. There are many civilians in need of food and supplies. Decorations from what was supposed to be a festive season remain outside. They don't bring joy anymore. It's important to watch out, otherwise you could run into one of the gangs. There's tons of dialogue in the game that can help you understand what people are going through. Abandoned cell phones, for example, shows the conservations between civilians, government officials, and criminals.

There are three kinds of main missions in the game, all of which help build the JTF's base of operations and are connected to the goal of saving the city. Some missions relate to the medical field. You receive credits to construct areas in the medical wing of the base (each one has perks attached) like a research lab, an intensive care section, or even counseling for those suffering mental trauma. There's also a law enforcement wing that prioritizes government control of the city. You have options ranging from an armory to K-9 units. Finally, the tech support wing wants to power up the city again by providing assistance with things like generators and technology for the Division. There are many small side missions that offer small doses of credits and more experience points  to upgrade a player's level.

There is plenty to explore in the largely abandoned city. You can go into shops and find medical kits or abandoned weapons. Sometimes there will be items that can be used to mod weapons. If you have too much stuff in your backpack, then you can sell it at the base of operations or several safe houses. The safe houses also add to the multiplayer portion of the game. A player can usually free roam throughout the city, but other players can be met in the safe houses to interact. It is at this time that teams can be formed to accomplish missions or go into the dark zone for an exciting player vs. player environment. Teams can think tactically when engaging others or AI enemies in battle. When fighting bosses, it is best to do so with others. In this way, you will find an enjoyable MMO.

The dark zone can become very paranoid as you try to find valuable resources. You never know when an enemy group sneaks up from behind you or in front of you when you take a turn at a building. The risks are higher because if you die, then you lose a lot of experience points and the supplies you were carrying in your backpack. This means you will have to be careful and work closely with your teammates to avoid getting overrun.

I think that Tom Clancy's The Division brings a lot of fun. If you are a fan of apocalyptic worlds, then you will be vested in the story. If you are more focused on playing with friends, then spend your time in the dark zone. It has a nice shooter experience and I hope to play more of it in the future.

Friday, April 29, 2016

Past Elections and 2016

Jimmy Carter and Gerald Ford debating during the 1976 election. - WWLP
Now for a little fun. In this blog post, I went back to four past presidential elections to see how they would play out with today's electoral map. Here's what I found using the election simulation website 270toWin:

1876


In America's centennial year, Governor Rutherford B. Hayes of Ohio was the Republican nominee running against Governor Samuel J. Tilden of New York as the Democratic nominee. If this election was repeated in 2016, we'd see quite a difference from 1876. Tilden actually won the popular vote, but Hayes won in the Electoral College by a single vote (185-184). Some states were too close to call, so it is believed that Republicans and Democrats in Congress agreed to a "great compromise" that gave Hayes the presidency in exchange for an end to Republican reconstruction in the former Confederacy. With the 2016 map, Hayes wins by a bigger electoral margin.

Notice that several U.S. states were still territories 140 years ago. Hayes does not get to the magic number needed to win the White House today: 270. The election is still close and if you flipped California from red to blue, then it would be a President Tilden giving an inaugural address. On a side note, Wisconsin had the same electoral votes in 1876 as it does now in 2016. One final fact: over 80 percent of the country turned out to vote then. Sadly, we don't come close to that percentage in modern presidential elections.

1896


Next up, we have the 1896 presidential election between "gold bug" Republican William McKinley and "bimetallic" Democrat William Jennings Bryan. It's interesting to see how the political coalitions of both parties changed in twenty years. The north was far more divisive in 1876 than it was in 1896. McKinley, former governor of Ohio, dominated the northeast and the Midwest. He only won two southern states. Bryan, a former Nebraska representative, decided to go for winning the traditionally Democratic south and pick-up western states with populist policies that would benefit farmers. It wasn't enough in an 1896 map and does not work in a 2016 map.

McKinley's electoral margin is closer, but he still wins over 270 and improves from his Electoral College vote tally in 1896. The closer margin can be attributed to a declining northern population. In the 1896 election, my home state had twelve electoral votes rather than ten. The very populous New York had 36 electoral votes in that election compared to 29 now while neighboring Pennsylvania had 32 electoral votes rather than twenty. McKinley's home state had 23 electoral votes back then and has 18 now. Even Nebraska had more electoral votes than it does now. Ultimately, California decided how the 2016 map would go. The Golden State had only eight electoral votes in 1896, but now it has fifty-five. McKinley won the state narrowly thanks to his appeal among manufacturing workers and businessmen in San Francisco. Bryan won most of the rest of the state, which contained farmers.

1916


It's almost the centennial anniversary of the 1916 election. Like any election, this one was important because of the issues at the time. It was a close contest between the embattled Democratic incumbent Woodrow Wilson and former Supreme Court Associate Justice Charles Evans Hughes. The issues at the time included the First World War in foreign policy and a combination of domestic affairs like the creation of the Federal Reserve and laws that intensely favored labor. Wilson won his second term by punching a hole in the Republican north with Ohio and winning California (another narrow win of just over 3,000 votes).

Today, the election looks very lopsided because of changes in the population. The additional electoral votes in California, Texas, and Florida expand Wilson's lead. In order for Hughes to become president, he needed to win in California, Ohio, New Hampshire, and Maryland with the 2016 map. It should be remembered that California was the deciding state in 1916 despite having only 13 electoral votes. Wilson won with 277 electoral votes to Hughes' 254.

1976


The last election I looked to was 1976. That year, Republican incumbent Gerald R. Ford took on Democrat Jimmy Carter, the governor of Georgia. Main issues included the Cold War and a slumping economy. When looking at the map, we see an east vs. west divide. Carter, a peanut farmer, was able to easily win in the south. Ford, who hailed from Michigan, made the Midwest very competitive and could appeal to the northeast with liberal ally Nelson Rockefeller. He also won all the western states.

California, formerly governed by Ronald Reagan, edged out for the president in another close election. The election also came down to other critical states. There were twenty where a candidate won with a margin under 5 percent. In the 1976 electoral map, Ford could have won a second term had he won Texas and another Midwest state like Ohio or Wisconsin. If we use the 2016 map, where Carter's victory is closer, then all he would have needed to do was flip Texas for a GOP win.

Monday, April 25, 2016

Stand for Free Trade

Adam Smith - The New York Post
A key contribution from the Age of Enlightenment was the birth of capitalism by the Scottish intellectual Adam Smith. Capitalism involves free trade, which means that nations should be allowed to freely exchange goods without any hurdles from the government. Free trade is responsible for increasing world peace after the Second World War and the Cold War. It has brought a tidal wave of prosperity to developing countries. It became a consensus view in the United States between Republicans and Democrats. Unfortunately, Bernie Sanders and Donald Trump have spread misinformation about U.S. trade policy. Their criticisms, while lacking any intellectual thought, threaten America's economy.

Trump and Sanders have been able to win many blue-collar workers and unions because they believe that free trade agreements have damaged the economic security of the United States. Many workers hold that view because of the closing of many factory jobs that began in the 1970s. Companies started to move overseas where labor was cheap. There have been brief campaigns advocating for protectionism in recent American history, but none as strong as in 2016. Hillary Clinton has moved significantly to the left on trade policy when Sanders was becoming a greater threat.

Even though protectionist arguments have been easily debunked time and time again from economists of both conservative and liberal ideologies, many either don't not know or refuse to read the research. The arguments Trump, Sanders, and Clinton make do sound appealing. If you were an auto worker in Michigan or a steel worker in Pennsylvania who lost your career to foreign competition, then I can see why candidates who pledge to bring back manufacturing jobs sounds promising. Ted Cruz won big in Wisconsin, but Trump did carry Kenosha county where there used to be a vibrant manufacturing sector. The Donald's highest percentage of support was in Buchanan county in Virginia. It's a white working class town that relies on coal mining. Few people have a bachelor's degree or higher, but most graduated from high school. The median household income is only $29,678 and most of them see politicians as people who just give good jobs away. The only problem is that there's no way those jobs are going to return.

Many voters may not realize this, but factories have recently been coming back to the United States. In fact, manufacturing output (adjusting for inflation, it is the value of all goods produced by factories) has increased by 20 percent since 2009 thanks to increased domestic demand, but job growth in that sector has only increased by 5 percent. The key to understanding why is technology. Factory production has become more efficient since outsourcing began in the 1970s. There aren't as many workers who were needed back then now thanks to automation. It makes unions mad because they cannot grow stronger, but this is an economic reality that will not change.

In a rant on The Money Illusion blog, George Mason University economics professor Scott Sumner lashed out at attacks on neoliberalism (the economic ideology that strictly backs free trade):
Fifty years ago, blue-collar workers at General Motors often made more than college professors. People with short attention spans sometimes act like this period was “normal”, ignoring 10,000 years of human history. They seem to suggest that our most pressing problem is that young men who don’t study in school and just shoot rubber bands across classroom should be able to earn an income that (in relative terms) was never possible in any period of world history before the 1950s and has never been possible in any period of world history after the 1970s. It reminds me of when farmers used to set the “parity” of farm prices with other goods prices based on the relatively high levels of 1909-14, treating that ratio as normal for purposes of farm subsidies. 
Don’t get me wrong;  I have nothing against blue-collar workers. I’m relatively intellectual, and even I found the public schools to be mind-numbingly boring. I could hardly stay awake. I can’t even imagine how students less interested in ideas than I am could’ve gotten through the day. Nor am I one of those conservatives that will trash low-income whites for their lifestyle choices. As far as blue-collar workers are concerned, I wish them well. But I wish everyone well (except Trump), and the unfortunate truth is that the set of economic policies that is best for the world right now is probably not optimal for a subset of American blue-collar workers.
There are plenty of myths that float around about free trade. It is accurate to say that the U.S. has lost jobs to other countries from manufacturing over the years. China is responsible for the loss of 985,000 manufacturing jobs from 1999 to 2011 according to the latest research, but that's nothing compared to the 131 million people who were employed in 2011. There are more imports than exports when it comes to America, but the latter still supports 11.7 million jobs. The North American Free Trade Agreement (NAFTA) is one easy target for Sanders and Trump to get Rustbelt voters, but in 2008 economist Daniel Griswold of the Cato Institute debunked many attacks made by Clinton and Barack Obama in that election cycle. The United States still remains far more wealthy than Mexico and manufacturing investment there is smaller than it is here. The Mexicans have had wonderful benefits from NAFTA, which has encouraged our southern neighbors to develop a more capitalist economy. It adds more competition to the world, thus lowering prices here for consumers.

What about that horrifying $532 billion trade deficit? Is it not bad that more capital is leaving the country that coming in? Not necessarily. The idea of comparative advantage (that some countries are better at agriculture while others are better at producing automobiles) has benefitted the world by giving consumers quality goods with lower prices. If having a trade deficit is so bad (and we've had one for many decades), then we would always be facing mass poverty and high unemployment. Free trade allows businesses to benefit by paying less for products they want to sell. That allows them to have additional capital for expansion. If the U.S. does want to bring more jobs here, then it should do it by embracing the free market. That means reducing corporate taxes, cutting away burdensome regulations, and preventing a higher minimum wage. Setting up a bunch of tariffs to end free trade is not the solution. Doing so would be catastrophic for all Americans because it would reverse the benefits we have received.

Friday, April 22, 2016

A Dose of Policy Medicine

My last post about the national economy in February concerned a possible recession that might hit this year or the next. I pointed out that our fiscal policy has been horrible and our monetary policy needs improvement. I also cited that more regulation and government intervention was what caused banks to enact dangerous lending that caused the housing bubble to burst. I usually focus on fiscal policy with an emphasis on tax reduction to promote incentives for economic growth. This post is going to emphasize monetary policy, which is more important than fiscal policy will ever be. There will also be arguments for deregulation and tax cuts, which are needed for American economic success.

The Federal Reserve has great power with controlling the U.S. economy. They control the supply of money and set interest rates. It is imperative that the central bank get monetary policy right. If not, then the policy can have catastrophic effects. Traditionally, the Fed has targeted inflation, but this is a strategy that isn't working out to bring a strong recovery. If the Fed wants to create 2 percent inflation, then they will go on an expansionary monetary policy to reach that goal. However, if the government's fiscal policy is also inflationary (which it has been), then the Fed has to contract. That means we are in a stage of monetary offset. In the February blog post, I mentioned economist Scott Sumner of Bentley University. He's also the director of the monetary policy program at the Mercatus Center in George Mason University. In a 2012 research paper published at Mercatus, Sumner made the case for a new a monetary target: nominal gross domestic product (GDP).

GDP, as everyone knows from taking their high school economics course, is the monetary value of all finished goods and services produced in a country. It's a simple equation:

Targeting our nominal GDP as opposed to inflation makes perfect sense. At first, targeting either two may not seem that different. Long-term monetary targeting using our GDP would not boost anymore growth or inflation that targeting inflation would. It also wouldn't do any better with handling demand shocks (radical changes in economic demand) than inflation targeting would. What NGDP targeting does offer is a more efficient way to target supply shocks (radical changes in supply shocks). I'll use Sumner's scenario of inflation policy as an example:
Suppose an oil embargo in the Middle East reduces our oil imports by 10 percent while boosting the price of oil by 60 percent. If it targeted inflation, the Fed would have to tighten money enough to deflate all nonoil prices in order to keep the overall CPI on target. Because nominal wages are sticky, or slow to adjust, a sudden fall in the price of domestically produced goods would cause a sharp increase in unemployment.
It makes sense. We know that reducing inflation means that unemployment is going to go up as explained in the Phillips curve. With NGDP targeting, we can grow our economy with more stability because employers need GDP more than inflation. Nominal GDP is our national income after all and growth naturally leads to higher profits for corporations which leads to higher wages over time. This means that employment will be stabilized by helping keep wages at equilibrium.

A second (and more important) advantage with NGDP targeting is that it limits asset market instability. Whenever NGDP is above average, an asset bubble tends to form like the one with the real estate industry before 2007 and another with technology services before 2000. Recessions usually correspond with falling gross domestic product, which makes economic conditions worse. NGDP targeting cannot completely end asset bubbles from forming (no policy can), but inflation targeting is worse. Sumner continues:
 An expected improvement in productivity, for example, will make creditors seek higher returns on their loans while also making it possible for borrowers to afford higher rates. An unexpected improvement, on the other hand, will cause lenders to wish they had charged a higher rate than they actually charged, given their incorrect expectations. Under inflation targeting, that sort of disappointment is not avoided. In contrast, under NGDP targeting the productivity shock is offset by an opposite and equally unexpected change in the inflation rate, keeping ex post real rates closer to where they would have been if both lenders and borrowers had been equipped with perfect foresight.
Sumner isn't the only fan of NGDP targeting. It actually has widespread bipartisan appeal among numerous economists, including former Obama economic adviser Christina D. Romer.

Aside from monetary policy, most people know that we need the federal government to implement the correct fiscal policy if it wants an economy with strong growth. Deregulation matters because it will bring back massive competition. America needs more production for long-term economic growth, yet fossil fuels have been heavily regulated by the Obama administration. In order to expand on the current energy boom from fracking, it is necessary to deregulate the extraction of traditional resources to boost economic growth, wages, and jobs. Obamacare also hurts the economy with regulations through the individual and employer mandates. Rising health insurance costs and employment costs do not lead to prosperity. Finally Dodd-Frank banking regulation benefits big banks by making it difficult for small banks to grow. These are the three primary examples of disastrous regulation during President Obama's time in office.

Tax cuts are always needed. Former Reagan economic adviser and CNBC contributor Lawrence Kudlow has been an advocate for supply-side policies. He has worked for a long time on advocating cutting taxes and bringing down regulations for the American people. Forgive me if this sounds like a broken record on my blog, but it needs to explained again, this time by Kudlow:
Research has shown that middle-income wage earners would benefit most from a large reduction in corporate tax rates. The corporate tax is not a rich-man’s tax. Corporations don’t even pay it. They just pass the tax on in terms of lower wages and benefits, higher consumer prices, and less stockholder value. 
So as I’ve written a million times: Slash the corporate tax rate to 15 percent for large C-corps and small S-corps, go to immediate tax deductions for new investment, and make it easy for firms to repatriate their overseas earnings. 
This would be the single-most stimulative program for reigniting economic growth. Principally, it’s a middle-class tax cut. If you combine that with regulatory rollbacks and a stable dollar, within less than a year the U.S. economy can break out of its doldrums.
The moment to get the right policies is through an election. We need large economic growth, so let's elect a president who will bring it to the country.

Wednesday, April 20, 2016

Trump and Clinton Triumph in New York

The Empire State Building flashed red for Trump's win and blue for Clinton's win.
Both front-runners have now regained their footing thanks to big victories in their home state. Donald Trump and Hillary Clinton won New York very easily last night. These wins aren't all that surprising. Both Trump and Clinton are from the Empire State and have spent decades working there. They both touted big victories last night and hope for momentum going into the remaining northeastern states. The opposing candidates will have to quickly find ways to stop what their opponents' paths to the nomination.

Ted Cruz didn't bother to campaign in New York because it was a big waste of time. Everyone knew who would win New York. A presidential candidate rarely loses his or her home state. John Kasich made an effort to win some delegates and he held several town hall events. Unfortunately, he will only walk away with four delegates from the congressional district that covers Manhattan in New York City. Trump won the other 89 and Cruz received none. This primary effectively erases the Cruz's chances of winning to a majority of delegates. I'm sure his campaign knew that beforehand, which is why they want a brokered convention. Here's the results:

Donald Trump - 60.4%
John Kasich - 25.1%
Ted Cruz - 14.5%

With the wind blowing his way, Trump wants to capitalize by winning the remaining northeastern states. There's been major restructuring in his campaign and now would be the time to go to internal polling. It is a necessity for any conventionally successful presidential campaign. Californian could pose a problem for his opportunity to win the nomination, so a very serious effort there might makes him unstoppable. Here's his victory speech:


The New York primary for the Democrats was expected to be competitive because of how much time both candidates spent there. Although the news agencies projected the winner for the Democrats later than the winner for the Republicans, it wasn't even close. Rather than an upset like in Michigan (what Sanders hoping for), the polls were very consistent for the primary's results. Here they are:

Hillary Clinton - 58%
Bernie Sanders - 42%

It's probably a fatal blow to the Sanders campaign. Born in Brooklyn, Sanders wanted to at least come close to Clinton. Instead, Clinton didn't just win Brooklyn, but all of the Big Apple and other major cities. Voters were turned off from Sanders after he made sharp attacks during the last CNN debate. He likes to say that he has the momentum, but it has now been crushed. Clinton is back on track to be the Democratic nominee. The delegate gap has widened in her favor again. The media gave Sanders positive coverage after his multiple wins in states further west, but his decisive defeat in a highly liberal state ends the kind of attention he has received. There was no major momentum in New York for him. College students, union workers, and rural voters aren't enough against Clinton's broad coalition of supporters. Sanders is a marginal candidate now. His losses are impossible to offset with what's left, as political scientist Nate Cohn describes:
Here’s one way to think about how big his deficit is: If all of the 17 contests Mr. Sanders won got to vote again (which is to say, counted twice), he would still trail Hillary Clinton in the pledged delegate count. 
Mrs. Clinton’s strength in New York, a state Mr. Sanders’s advisers contended they could win, confirms that he is not on a pace to win the remaining states by such a clear margin.
I think the Democratic race wrapped up last night. Here's Clinton's victory speech:

New Game creates the Titanic Sinking

In a post last year, I brought up a new game that I helped fund called Titanic: Honor and Glory. I've been happy to see the development that has been made on the game. On April 15, for the anniversary of the sinking, they uploaded a video that recreated the entire event. I'm in awe at the progress the creators have made:


I'm looking forward to the entire game when it finally comes out! They put into a lot of hard work into accurately creating the sinking. Everything from the look of the night to final plunge show that this will be a very great game for history lovers. I highly recommend helped them out. Here's their website.

Monday, April 18, 2016

Will I change my mind on Sanders?

Bernie Sanders campaigns in New York - Eric Thayer/Getty Images
During the 2016 election, Bernie Sanders has turned his presidential campaign from one that was easily dismissed to a wildly successful force of supporters. He is now trying to pull a big upset in New York. Even though Sanders has become more formidable since April of last year, I have always remained skeptical that he has a good shot at winning the Democratic Party's nomination for multiple reasons. With an important state voting tomorrow, I want to explain what can change my opinion about Sanders.

There is no doubt the senator from Vermont has had successes during the 2016 race for the Democratic nomination, but he hasn't been very successful. He has won several states, but most of them are small western states with rural voters. His wins in New England were expected because that's who he identifies with the most. He is that region's candidate. I think Sanders' most important victories were in Midwest states that have larger populations. However, Sanders has not dominated the Rustbelt. Hillary Clinton has won victories in big states like Ohio and Illinois where he needed to come out ahead.

Clinton should take Sanders seriously, but she is still far ahead when it comes to winning the nomination. Sanders supporters think that the superdelegates will change their minds if he continues to win more states and more pledged delegates. They hope that the party leaders will realize that the people have "chosen" Sanders over Clinton. Enough superdelegates then flood to Sanders allowing him to win the Democratic nomination and go on to the presidency in November. Their argument is flawed. Sanders supporters are simply not comprehending that Clinton already is the people's candidate (at least for Democrats). She has won 56.25 percent of all Democratic voters so far. That's a comfortable majority. I have to hammer the point again: Sanders does best in small states. Clinton has won many large states (Virginia, North Carolina, Florida, Ohio, and Texas are examples) easily as well as plenty of small states in the south.

If I was a Wisconsin superdelegate in the Democratic Party, I would look at all the results so far and say that Clinton has the will of my party's voters. In fact, Sanders has won more delegates than he has voters thanks to landslides in those small states he focuses on. I think there's a lot of misinformation spread about superdelegates. They're basically party leaders who become delegates because of their position in the Democratic Party. Candidates have to woo them for votes. The only reason 2016 is so lopsided is easy to understand: Clinton is an establishment politician who's worked in the party for years in Arkansas, in the White House, as a New York senator, and a secetary of state. It's important to remember that Sanders is an independent who's never run for president previously and has zero experience working within the party (even if he does support their candidates). Superdelegates are there to make sure the party picks an ideal candidate in 2016. Let's be honest: how many voters actually know more about winning elections than people who have been elected and spent years in politics?

Despite a nice win streak, Sanders is rightfully considered the underdog and not the front-runner. Clinton still leads in national polls, even if that lead is a close one. National polls are also becoming more and more irrelevant because there are only slightly over ten states left. A Democrat can't do anything if they already voted for Clinton, but have now changed their mind. The only way to know who will win the remaining states are through the polling averages. According to the RealClearPolitics New York average for the Democratic nomination, Clinton has 53.7 percent and Sanders has 40.9 percent. That's a lead of 12.8 percentage points. But the 2016 race has been full of surprises and one the most iconic was Sanders' shocking victory in Michigan that had everyone stunned. Before the primary, it was thought that he was going to lose because Clinton had a crushing lead in the polls (bigger than her current lead in New York). Sanders surprised everyone by winning a close victory that kept him in the race. Can lighting strike twice? It's possible, but unlikely.

New York isn't exactly Michigan. The two states are along the Great Lakes, but they have different voters who focus on different issues. Nevertheless, Sanders is campaigning hard. He was able to get 28,300 people to attend his rally in Brooklyn. His supporters are motivated to go out and vote. Sanders does have the potential to win the Empire State. He has liberal supporters in New York City, but also environmentalists in Hudson Valley and farmers upstate. New York also has a history of insurgent candidates (just look to Mayor Bill de Blasio in the Big Apple), so it's not like winning is impossible. At the same time, Clinton has the edge. It is her home base and the primary is closed (you must be a registered Democrat to vote). Sanders did very well in Wisconsin because it was an open primary, but now all those independents have been blocked unless they join the Democratic Party. There has been a sharp increase in registering, however, so maybe Sanders supporters jumping into the primary at the last minute. If he does win, then I will reconsider his candidacy because it would embarrass and shatter the strength of the Clinton machine. Even so, I still expect New York (as well as the Democratic nomination) to go to Clinton.

Sunday, April 17, 2016

The Fall of Brazil

Brazil's Dilma Rousseff, August 2015 - Ueslei Marcelino/Reuters
Brazil's embattled first female president, Dilma Rousseff, is fighting for her political life as the legislature moves to impeach her for hiding the true fiscal situation of her government. The lower house is scheduled to hold a vote today, in which a two thirds majority is required to impeach the president. The impeachment process will then be transferred to the upper house. Many people believe that the impeachment's supporters have momentum, but it is expected to be close. Whether Rousseff is impeached or not, it is only one of many dilemmas that are making Brazil increasingly unstable just before it will host the Summer Olympic Games in Rio de Janeiro.

It was once hailed as a beacon of economic development. In 2002, Brazil's gross domestic product was only $508.8 billion. By 2011, it was $2.6 trillion and the county was widely considered a rising economic powerhouse. The success story focused on the democratic socialist policies of the Workers' Party (PT). In 2002, founding member Lula da Silva was elected president by a landslide and ousted the centrist Brazilian Social Democracy Party (PSDB) from power. For more than a decade, Brazil would be experimented on with what has become known as "the Lula model."

It was a leftist model of economic development the emphasized the creation of a welfare state to bring millions of Brazilians out of poverty while appeasing big business. Lula, who was a union boss before entering politics, worked to guarantee electoral consensus. He was able to achieve a lot of legislative successes. His most popular policy was the expansion of payments to families who made sure their children had good school attendance and got vaccinated. Economic growth surged like a speeding bullet thanks to the extraction of natural resources through mining, oil production, and agriculture. The redistribution of money boosted consumption among the poor and the middle class. After a second term, Lula decided to not run for a third and Rousseff replaced him after winning the 2010 election decisively.

The Lula model started to show cracks fairly early on. Shoveling money around made Lula and Rousseff widely popular, but it didn't help to bring down corruption or make investing in the country attractive. The tax system isn't much to brag about and there was little motivation for privatization of state industries. As a result, large construction and energy firms made lucrative deals with Lula and Rousseff while vast political donations were given to Workers' Party politicians in exchange. Recession started to materialize in 2014, just when she narrowly won a second term. The downturn has been caused by Rousseff's interventions in the financial sector and price controls in the economy that have ruined market flexibility and the value of many companies. Private business leaders don't have the incentive to invest capital into the country because of the current policies. Since 2014, economic growth in Brazil has been precariously sinking:


The widespread corruption is now just being discovered thanks to an investigation in Petrobas, the country's state oil company. Around 130 executives and politicians have been jailed since the investigation began and many lawmakers are under legal probes. Lula is in trouble for allegedly profiting off of former government contractors, so his successor tried to appoint him chief of staff in order to provide strong legal protection. A judge struck her actions down, opening another trial.

Rousseff is facing an impeachment for lying about Brazil's budget. Violating budget rules, she decided to cover up a widening deficit with money from public banks. Fiscal responsibility has been abandoned with the expansion of social welfare programs and the allegations are that she attempted to hide it to avoid any political damage. Since the revelation, her approval rating has plunged to around 10 percent. If she is impeached, then she will be Brazil's second sitting president to be removed from office (the last being the end of military rule in 1985). In an odd way to defend herself, Rousseff touched into Brazil's authoritarian history by saying that her political opponents are launching a "coup" against her. Nothing could be further from the truth and talk of such a threat has almost become a cliché among leftist leaders in South America. The legislature is acting lawfully and the Cold War has been over for decades.

If Rousseff loses her job, political turmoil will not be over. Sadly, it has the potential to get worse. Vice President Michel Temer has his own problems and is under a different investigation. In what has to be one of the most foolish mistakes in politics, Temer accidentally released audio of him preparing a national unity speech once Rousseff is out of office. The president has pounced on her subordinate, saying that he's a "conspirator" of the "coup." Either way, Temer might bite the bust as soon as he becomes president because he is also listed in the Petrobas scandal. If he is impeached, then lower house leader Eduardo Cuhna takes the job. The only problem with him is that he's facing a money laundering scandal that involved $5 million in Swiss bank accounts.

All this is happening while the alarming Zika virus plagues both American continents. Brazil is a hotbed for the disease. Spread by mosquitoes, the Zika virus causes severe brain disorders and temporary paralysis. Symptoms include problems with memory, vision, and motor skills. Pregnant woman need to be highly protected because the disease can transmit to unborn children. There will have to be strict safety protocols implemented when athletes and thousands of fans arrive from across the world.

If the committee for the Olympics had the opportunity to change their destination for the summer of 2016, I'm sure they would have done so immediately. It's too late now. I hope nothing goes wrong, but faith in the Brazilian government is depleting. We don't even know who the head of state will be that will observe the opening ceremony. Think about this: will there be a different one watching the closing ceremony? We shall see.

Saturday, April 16, 2016

Can Trump get to 1,237?

Trump campaigns at a GOP dinner - Damon Winter/New York Times
Donald Trump will win by a landslide in his home state and receive all or nearly the entire collection of New York's 95 delegates for the Republican convention. His win will not be surprising because he is loved in the state and has been campaigning there. However, he does need the win after suffering a series of defeats in North Dakota, Wisconsin, and Colorado. Trump remains the front-runner and I think he will have the advantage all the way to the convention, but the problem for him is that he might lack a majority of the delegates needed to become the nominee. If he doesn't win a majority of delegates, then the Republicans will have a brokered convention and it is likely that Ted Cruz will be the nominee.

Cruz is known for excelling with establishing proficient campaign strategies. He knows how to bring out his supporters to vote. He's also experienced enough to know that he should send representatives to get support from uncommitted delegates and state conventions. The most recent example is the Republican Party of Colorado's convention. The junior senator from Texas won 34 out of 37 delegates that represent the Centennial State. Trump threw one of his expected temper tantrums and said that the people weren't allowed to vote because the state party bosses decided the delegates. If you ask anyone in Colorado, they will tell you that he's wrong. There was a vote.

I'm going to quickly address how Colorado votes. First, it's important to understand that many parties in western states with smaller populations prefer to not do primaries, but instead vote on delegates at district conventions. Colorado held caucuses on Super Tuesday and people were notified where to take part. Registered republicans went to precincts where they selected delegates based on voting. In the article I hyperlinked, a Coloradoan went to his Republican caucus with around 25 other people.

At this time in the race, Marco Rubio was still running for president. When voting was finished at this voter's precinct, there were nineteen for Rubio, four for Cruz, two for John Kasich, and two for Trump. After voting, the caucus had to elect three delegates who would go to the district convention. It was decided that there would be two Rubio delegates and one Cruz delegate representing the precinct. When Rubio dropped out, his two delegates were uncommitted, so they decided to vote for Cruz. Finally, at the state convention, the remaining 13 delegates were selected to nominate Cruz by the registered Republicans attending.

Based on what the voters of Colorado saw during their lengthy process, Trump took no part to campaign in the state (Cruz actually went to the state convention). It is very revealing that he never complained until after the process was over. His attacks are unfair because the Colorado GOP had their nomination system set for months and all presidential campaigns were informed about it. The people did have a voice in the election process, it just wasn't for Trump. His campaign was heavily disorganized. In one case, the Trump campaign had printed out brochures at a district convention listing the three delegates his supporters should vote for. The only problem was that two of the names weren't on the voting ballot while actual pro-Trump candidates were left off. The Trump campaign also picked their political operatives very late. Cruz's state campaign began eight months before any voting took place.

While New York should get the billionaire's campaign back on track, the task for Trump is to expand his coalition. It currently ranges between 30 percent and 40 percent and he will lose future contests if his percentage of votes is closer to the former. Fred Barnes, executive editor of The Weekly Standard, outlined Trump's problems in an opinion article for The Wall Street Journal:
Attracting conservatives won’t be easy. Many are fiercely opposed to Mr. Trump, some to the point of declaring that they wouldn’t vote for him under any circumstances. And with the GOP convention only three months away, it is awfully late to begin pursuing the GOP’s most important bloc of voters after having largely ignored them.  
There are other problems. As the longtime conservative political analyst Michael Barone has observed, “Trump speaks conservatism as a second language he hasn’t bothered to master.” The candidate may have felt he would score points with the pro-life movement with his recent advocacy of punishment for women who have abortions. He was wrong and had to reverse his position publicly. 
Nor is Mr. Trump up to speed on conservative politics. Before the recent Wisconsin primary, he relentlessly attacked Scott Walker, the state’s Republican governor, who had endorsed Ted Cruz. Mr. Walker was an early dropout from the presidential race, and thus a “loser” in Mr. Trump’s mind. But Mr. Walker is enormously popular in his home state, and assailing him backfired on Mr. Trump, who lost the primary.
Trump wants to reach out to Republicans by focusing on public policy proposals. It's his last chance to unify the party in later contests like Indiana and California. Trump has some plans for several issues like taxes and immigration. You can find them on his website. He does not have proposals on many foreign affairs and there is still plenty of time to talk about more domestic policy (most notably K-12 education reforms, college affordability, and national infrastructure). These issues give him the opportunity to improve with conservatives. If he does not do so, then his chance of winning a majority of delegates becomes unlikely. I do think that Trump has the opportunity to expand his coalition and win a majority at the moment.

What happens if we go into a Republican convention where Trump is under the magic number of 1,237? Maybe he can still pull off a win if he's down by just 25 or 50 delegates, but it gets hard depending on how big the gap is. Most delegates are not expected to like Trump. They are supposed to vote for him on the first ballot, but if he does not win a majority then many have the choice to vote for who they wish on the second or third ballots. Delegates are traditional Republicans who have spent years working in politics. They aren't just people who go out and vote, but people who have earned the right to be a delegate. Yes, they are told who they are representing on the first ballot, but they are also people who may have voted for another candidate and they can change their vote on the second ballot. Some delegates will be party leaders who oppose Trump. If he does fall short of the required majority, then Trump must start to negotiate. Right now, Cruz has already prepared for a contested convention.

Trump's campaign can get him to a majority of delegates, but it won't be easy. He has to attract more voters and hope that the opposition remains evenly divided between Cruz and Kasich. If those two things happen, then I think he should win the Republican nomination. If not, then it's going to be a very rough summer.

Friday, April 15, 2016

California's Minimum Wage Hike

Celebration of the minimum wage law - Lucy Nicholson/Reuters
When you make mistakes in life you might learn about them very shortly or over a long period of time. In my view, learning lessons about the minimum wage is going to take years. Rational people already know about the unintended consequences, but there are many who haven't figured out the problem. Sometimes you become educated through experience and I think the proponents of the minimum wage will realize their mistakes once the ramifications are fully felt.

California is the first state to fall victim to the idiotic $15 minimum wage campaign. This is understandable. The state is very liberal and many cities like San Francisco and Oakland are already going through large minimum wage increases. Data shows clear indications that these cities are suffering from the new laws, but it's still early for many people to be paying attention. There is a tiny silver lining to the latest news. Governor Jerry Brown wasn't sold on the minimum wage bill immediately, but unfortunately he decided to bow to the pressure of labor unions and Democrats in the state legislature. He seems forced, rather than excited, about signing the bill. The new policy will be phased-in over several years (like in most cities) until $15 an hour is reached in 2022. By then, Brown will be out of office.

No state currently has a $15 minimum wage (California's is currently $10), but we do have an example of high wage policy in the territory of Puerto Rico. The minimum wage was last hiked to $7.25 through the Fair Minimum Wage Act of 2007. The territory suffered from increases that created a rate 75 percent greater than the median wage. The results were disastrous. GDP per capita in Puerto Rico declined by 7 percent from 2007 to 2013 as unemployment surged upward. The island's economy became very uncompetitive, so foreign investors preferred tropical neighbors like Jamaica and the Bahamas. Tourism declined due to a 30 percent premium for a Puerto Rican hotel room relative to other vacation destinations. Other territories like American Samoa and the Northern Mariana Islands also dealt with terrible growth following the most recent federal law.

The argument for raising the minimum wage is being framed carefully by those who understand it the most. Economists who do favor wage hikes acknowledge that there is job loss from enacting such a policy. Those who are most vulnerable to a bad job climate are young people, who activists often ignore. I don't think we should seek a "living wage" through government policy when it leads to lower employment opportunities. Most of the jobs that pay minimum wage are entry-level for people who have not learned skills. I would be happy getting paid $15 an hour, but not if I'm the one who gets fired at work because the cost of labor is too high. Even if I did stay, I wouldn't like seeing co-workers let go because of a new hazardous law. I hope I never see such a hike in Wisconsin.

Unfortunately for many in California, what I want to avoid will become reality. James Sherk, a labor economist at the Heritage Foundation, believes that there will reduced employment in California. He argues that it will hurt manufacturing companies that sell goods across state borders. There are 1.6 million people in California who make less than $15 an hour in manufacturing (37 percent of workers in that sector). These employees are at a huge risk because companies in their sector don't have the opportunity to raise prices as easily. They'd have to break several contracts and negotiate price increases, which would make consumers angry. The fast food and hotel industries are traditionally at risk from wage hikes and there will likely be higher prices in those sectors as well.

The California Policy Center published an analysis on what the impact would be under the new law. Economist Marc Joffe looked into current hourly wages within metropolitan areas. Median wages are under $15 an hour in three areas in the Central Valley. The economy in the region remains weak and the new minimum wage hike is unlikely to provide any help. By 2021, Joffe expects all median wages in the twenty-eight metropolitan areas he researched to be over $15, but in many places around a quarter of all workers will still be paid under that wage if the government did not implement an artificial increase. Since everyone has to be paid $15 an hour by then, he predicts tens of thousands of jobs will be lost and many businesses will turn to automation. I don't think minimum wage activists will be happy when they see the consequences of their actions six years from now.

Monday, April 11, 2016

The Panama Papers

Prime Minister Sigmund Gunnlaugsson resigns - Inqusitur
This is an issue that I'm very angry about. On one hand there is the issue itself and on the other hand there is the media's coverage of it (or lack thereof). I suppose the low amount of media attention on the "Panama Papers" controversy is because President Obama is not involved in it, but there's a firestorm raging across several nations. Populist agitation is not just occurring in the United States at the moment, but across the globe. The Panama Papers have landed many world leaders and many establishment parties in hot water and encourages the populist movements to press on.

So what's the controversy? The International Consortium of Investigative Journalists has launched a special project with the publication of 11.5 million encrypted documents from the Panamanian law firm Mossack Fonseca. The firm provides services for 16,300 offshore businesses and it is in a typhoon of trouble. The documents show that Mossack Fonesca created secret accounts and shell companies for a number of politicians and businesspeople so that they can avoid paying more taxes. The firm was very discreet and usually went through intermediary accountants and lawyers in countries like Switzerland. Thousands of people have taken to the streets in a massive global backlash that protests the "elites" who were involved.

The first person to suffer was Sigmundur David Gunnlaugsson, prime minister of Iceland, who is expected to resign following a national petition. It is reported that his wife owned a foreign company worth millions that had claims on failed Icelandic banks. It also happens that the prime minister owns shares worth $4 million on three banks through a shell company in the British Virgin Islands, which he didn't disclose upon becoming the prime minister in 2009. He sold all those shares to his wife for just $1 a year later. Nothing here may have been illegal, but it was clearly unethical.

Other world leaders that are in trouble include Prime Minister David Cameron of the United Kingdom, who is already in the midst of a political clash over his country's membership in the European Union. Cameron's father profited by setting up a trust through the Panamanian firm. The prime minister says that he owns "no shares, no offshore trusts, no offshore funds" when asked about the matter, but that he did own shares in his father's home firm of Blairmore Investment. Cameron hasn't done anything wrong, but doesn't mean the British people will see it that way.

Vladimir Putin, the authoritarian president of the Russian Federation, is not in any of the papers. Nevertheless, many of his friends and advisors are listed. Close friends like the famous cellist Sergei Roldugin are intensely involved with Russian state banks to hide billions offshore. Russia is a far cry from Iceland and I don't think this scandal will force a very undemocratic head of state (who controls most of the media) to resign. The Kremlin's position appears to be that it's an attempt from western rivals to take down their leader.

In the Orient, another dictator is scrambling to stop the political fallout. General Secretary Xi Jinping of China has gained praise since becoming leader for his anti-corruption efforts, but he is now under scrutiny thanks to the Panama Papers. Based on what we know, Xi is not associated with Mossack Fonesca, but some of his relatives and ministers are. The Chinese government's response was a massive crackdown on the media discussing the topic. Broadcasts from the British Broadcasting Corporation and the Cable News Network about the papers are not being shown in the world's most populous nation. How many Chinese actually know about the details of this scandal remains unclear.

These leaders are some of the most notable, but others who are implicated include Syria's Bashar al-Assad, Argentina's Mauricio Macri, South Africa's Jacob Zuma, Mexico's Enrique Pena Nieto, and many more. It's a whole buffet of murderous dictators and "democratically elected" presidents that lead countries where the rule of law barely exists. The impact of the Panama Papers is mountainously scandalous. Hiding wealth is not always illegal, but it lookes unethical when it comes to politicians (they have some explaining to do). Millions of people are wondering why their own leaders would hide their wealth. In the age of data leaks and computer infiltrations, I think there's more to come.

A rising criticism of the Panama Papers is that they expose the faults of capitalism. This is a weak argument. What's important about this case are the weak institutions in countries that need to prevent corruption. The United Kingdom might be a bastion of free market economics, but most of the countries involved are hardly as free as the UK. Countries like Russia, China, and Syria are not capitalist countries. The leaders of these places were able to gather their wealth through extortion, not commerce. In the United States, our Internal Revenue Service is very good with finding people who cheat on their taxes. It's the laws that matter and they need to be properly enforced. Right now what is needed is strength against corruption, not an emotional rebuke against capitalism.

Wednesday, April 6, 2016

Cruz and Sanders win Wisconsin

Cruz celebrates Wisconsin victory - IBT
In a very exciting night, the two front-runners of the 2016 election faced major setbacks. Ted Cruz and Bernie Sanders were victorious in the Wisconsin primary. For the Republicans, a brokered convention is becoming more likely after Cruz won a large victory last night, taking with him 36 of Wisconsin's 42 delegates. Hillary Clinton, on the other hand, should be concerned but not in a full panic. Thankfully for her, the rules of the Democratic primary give her a nice proportion of the Wisconsin delegation. Nevertheless, she has been driven to agree to another debate before upcoming primaries after seeing polling data days before the primary and in other states. Sanders is probably ecstatic.

I fully expected Ted Cruz to win last night. I was happy to vote for him and I attended his victory party, but I was not expecting his victory to be so crushing. Here are the results:

Ted Cruz - 48.2%
Donald Trump - 35.1%
John Kasich - 14.1%
Others - 2.6%

Cruz won almost every county along Lake Michigan. He won key areas like the WOW counties, Milwaukee, Madison, and Green Bay. This strong performance in Wisconsin's most populous areas landed him the victory very early when the results were being tallied. There are a number reasons as to why Cruz easily won the Badger State. First and foremost, Scott Walker's endorsement was critical to win the state. Trump miscalculated badly and decided to attack the Wisconsin governor. He also made the mistake of going on shows with radio hosts who were clearly against him. His comments on abortion spread confusion throughout the primary and made women voters angry at him. Most voters did not care about the immigration issue and finally a large number John Kasich voters went strategically for Cruz. This severely hurts Kasich's attempts at trying to win in the Midwest.

Is Wisconsin a turning point? Many are starting to say that it makes a brokered convention more likely, which is damaging for the Trump campaign. This was a state he needed to win to appear inevitable, but he leaves with only six delegates and has absurdly claimed that his main rival rigged the primary. Trump has to perform better in future states. Luckily for him, New York and other northeastern contests are just around the corner. Here's Ted Cruz's victory speech:


You have to hand it to Sanders: he gets wins when he needs them. Most of his recent victories could easily be dismissed because they were in small states. Wisconsin is an important battleground state and Sanders proved that he can still be competitive. Clinton only won Milwaukee county. The results are here:

Bernie Sanders - 56.6%
Hillary Clinton - 43.1%
Others - 0.3%

His path to win the nomination is still difficult. That's why he was campaigning in Wyoming when the results were announced to keep up his winning streak, but he's going to run into trouble with New York. Like Trump, it is the Democratic front-runner's home state with 247 delegates for the party's convention. Sanders won a victory in that he forced Clinton to debate him on April 14 and he's going to need to knock her out if he wants to continue. Can he do it? Possibly. The delegate math still heavily favors Clinton, so Sanders needs to campaign hard. He was born in Brooklyn, but he isn't a politician there like his opponent was.

The good news for the Vermont lawmaker is that he has been raising more money than Clinton over the last several months. He could spend it on ads in the Empire State. I fully expect him to organize several rallies at locations near colleges before voting day. Winning New York will be a stunning upset and he knows it. Here's Sanders' victory speech:

Tuesday, April 5, 2016

Prediction for the Wisconsin Primary

Scott Walker and Ted Cruz - NBC /Reuters
It's been an amazing last few weeks. I've had the privilege of seeing John Kasich, Donald Trump (finally got to see him on Sunday), and Ted Cruz campaign to win voters and the state's 42 Republican delegates. It's wonderful to engage in my civic duty and listen to the three men who could be our next president. Most of you know that I decided to oppose Trump long ago, which left me to choose between Ohio's governor and the senator from Texas. After much thought, I voted for Cruz today. The person who I believe explains it best is my governor. Scott Walker endorsed Cruz last week, which has significantly boosted his support across the Badger State. I support Cruz because I think he is truly principled in the Constitution and offers economic policies that will ignite growth in the country.

Ted Cruz campaigned hard in the Wisconsin and the polls show it. The RealClearPolitics average shows him leading against Trump. He has 39.5 percent, the Donald has 34.5 percent, and Kasich has 20 percent. The most valuable poll in Wisconsin politics, the one from Marquette Law School led by Charles Franklin, shows the Texas senator with a double-digit lead over the New York billionaire. Momentum has swung towards the Cruz campaign. It isn't just Walker. I already mentioned radio host Charlie Sykes, but the other major conservative talk radio hosts in the state also oppose him like Vicki McKenna, Mark Belling, and Jay Weber. Trump is running against the Republican Party of Wisconsin's whole political apparatus and he is in deep trouble. Many Republicans, like myself, in the state were very skeptical of his candidacy and he hasn't been that persuasive. Kimberley A. Strassel, a member of The Wall Street Journal editorial board, has the best explanation I've read about his weaknesses in Wisconsin:
Part of Mr. Trump’s problem is simple logistics. Wisconsin was put on the calendar as a stand-alone primary, with two clear weeks before and after it. The field is now down to three candidates. All of this has allowed for far greater scrutiny of Mr. Trump, in the form of heavy in-state advertising and earned media.  
But it’s the in-state dynamics that are hurting him most. Wisconsin has been in continuous political warfare for six years. Over that time, Republicans lived through Gov. Scott Walker’s epic battle for his Act 10 public-sector bargaining reform; judicial races; a Senate recall effort; a gubernatorial recall effort; a political assault in a vicious John Doe probe; another election cycle; campaign-finance reform; an overhaul of the state’s ethics body; a right-to-work law; and prevailing-wage reform. To name a few.
The state is also proudly home to the speaker of the House, Paul Ryan, and a governor (Scott Walker) who ran for his party's presidential nomination. The result is a conservative electorate that is highly informed, highly energized and highly involved. The fights so far have given voters an acute appreciation of the conservative principles at stake, and a pride in defeating union and liberal priorities. They have radar sensitive to “fake” Republicans, and many aren’t keen on what they are hearing from Mr. Trump.
One of the most excellent and detailed maps of Wisconsin has come from political analyst Craig Gilbert of the Milwaukee Journal Sentinel. He used the last Marquette poll (from March) to put together a map that shows where Trump is loved and where he is hated:

Milwaukee Journal Sentinel
According to this map, Trump has little support in the south of the state. The key WOW counties (Waukesha, Ozaukee, and Washington), where turnout is imperative for Republican candidates to win statewide elections, is vehemently against Trump. In my home county of Milwaukee, the Republicans also don't like Trump. A Republican candidate wants to win in suburbs like Greenfield, Greendale, Wauwatosa, West Allis, and South Milwaukee. These areas are not Trump territory. Neither is Dane (where the capital of Madison is located) or other large counties like Racine and Kenosha. Trump will perform best in the north of state tonight. He should have large northern cities like Wausau, Chippewa Falls, and Superior under his belt. Even so, the populations in these areas are not enough. His only chance is to win big in Brown (Green Bay) and Outagamie (Appleton) while the Republicans downstate are split between Cruz and Kasich.

It's important to remember that the winner will get the most delegates, but not all. Winning a congressional district gets you three delegates. I think Cruz will win districts one, four, five, and six. Trump will win seven and three, while I think district eight will be close between the two of them. As for Kasich, I think he will actually win the second congressional district. Republicans in and around Madison are very moderate. He has been campaigning hard and has a talented surrogate in former Governor Tommy Thompson.

My prediction is a Cruz victory tonight and here's what I think the results will be around:

Ted Cruz - 42.9%
Donald Trump - 35.2%
John Kasich - 21.9%

The Democrats? I think that will actually be closer than the Republican race. Like with the GOP race, it's momentum that matters and I think Bernie Sanders has it. He has the RCP average on his side and the Marquette poll. With his 47.9 percent in the average to Clinton's 45.2 percent, we can expect the results to be narrow. Nevertheless, Sanders campaigned hard and I think the race will go to him. He has large support in the rural north and west as well as a large number of voters to count on in Dane county and other areas within the Madison TV market. Clinton needs Milwaukee, Green Bay, and counties stretching across the two cities to win the state. The good news for her is that even if she loses, the Democratic Party of Wisconsin's 86 delegates are given out based on proportion.

Hillary Clinton and Tammy Baldwin - Daily Herald/AP
Sanders has spent more money than Clinton in Wisconsin. He knows that Midwest states have his favored demographics, so he has run television ads over 1,000 times while Clinton has only run 495. The former secretary of state has the state's political machine on her side. Tammy Baldwin and Gwen Moore have endorsed Clinton, but it doesn't look like endorsements will be enough. That's why I give this race to the senator from Vermont. I think the results will look like this:

Sanders - 51.6%
Hillary Clinton - 47.4%
Write-ins - 1%

Above all, my fellow Wisconsinites, go out and vote. It is your opportunity to dramatically change the future of the country and change the path forward. I have no doubt that it will be a historic night.

Saturday, April 2, 2016

Bernie Sanders is Nuts

Bernie Sanders in Madison, WI - Yahoo
It is unbelievable how far we've come since the Cold War. A septuagenarian socialist is receiving a flood of momentum ahead of the Wisconsin primary and is likely to win the state because of how large the demographic groups are that support him. One of his supporters would probably berate me and say, "but he's a democratic socialist" as if that makes it better. It doesn't. No matter if the socialist ideology is closer to Karl Marx or closer to Sanders, it always fails and slows the growth of a country. Socialism is also still synonymous with many terrible dictatorships in the world. These are places where the people cannot vote for their future and are jailed (or killed) when they stand up for their rights.

Sanders' opposition to capitalism is filled with weak arguments. Socialism has proven again and again that it cannot lead to prosperity. The birth of capitalism with Enlightenment thinkers like Adam Smith brought wealth to the common people on a mass scale that will never be rivaled in our history. Sanders loves to talk about income inequality, but the argument is specious. The middle class is not what it was decades ago because many of those who were in it moved into the upper class and the ranks of the affluent. A significant percentage of American households are making more than $80,000 than they were in the 1970s, even when adjusting for inflation. This means that income inequality, if we are to judge it at all, is actually good and natural in an economy. Adding to the benefits, the expansion of free trade has allowed the prices of goods and services to drop. The price reductions have made items that are needed in life easy to afford for poor people.

For examples of "successful" socialism, Sanders often points to the Scandinavian countries (Denmark, Finland, Norway, and Sweden). These nations are not perfect utopias like he advertises. The Danish prime minister, Lars Lokke Rasmussen, has repeatedly criticized Sanders for calling his country socialist. Indeed, there are many economic policies where Denmark is more conservative than the United States, but there are socialist policies as well that keep the country behind. In the case of healthcare, the Danes do have a socialist program. This program has many problems including a reduced rate of medical progress, increased rationing of care, increased wait times of patients, and it leads more doctors to retire early. The healthcare plan Sanders proposes would lead to outrageous spending growth in the federal budget.

It's not just healthcare, of course. Young people have been drawn to Sanders because of his plan for free tuition at public colleges. It should be obvious to everyone that this puts private universities in jeopardy. Prominent academic institutions in Wisconsin like Marquette, the Milwaukee School of Engineering, Carroll, Wisconsin Lutheran, and Cardinal Stritch University will be desperate as students flock to colleges that are public.  Many of them may go bankrupt, which creates reduced education options for students. There is more to why implementing free tuition is a bad idea. It would lead to more centralization of the American education system and that causes less innovation. Whenever a system becomes more bureaucratic and regulated, the opportunities for advancement become slim. A better proposal is one that removes government barriers in higher education, allowing colleges to become more efficient and lower the costs.

When Sanders is attacked for the price of all his spending proposals, the Vermont senator goes to taxes. Everyone will see a tax hike, with the wealthiest Americans seeing their personal income rate increase from 39.6 percent to 54.2 percent. Capital gains will also have a more progressive tax system with the top rate identical to the personal income rate. There will be a new 6.2 percent employer-side payroll tax, a new 2.2 percent broad-based income tax, and new 0.5 percent financial transactions tax. So far, two studies have been published on what would happen if Sanders' tax plan was implemented. The first study, from the Tax Foundation, finds that 5.9 million jobs would be lost and capital investment would plunge by 18.6 percent. Less jobs and investments will cause growth in our gross to fall by 9.5 percent. Wages will decrease by 4.3 percent (so much for being a man of people). Sanders supporters will just say that he can fix the issue by raising the minimum wage to $15 an hour. I've already made several posts about that fallacy, but you can always take a look at how awful it's been in Seattle, Washington. The second study from the Tax Policy Center finds similar results if his tax plan was made law. Higher taxes will lead many higher income people and large corporations to leave the country or shift their assets internationally, lowering government revenue growth over the years.

Lastly, Bernie Sanders has been critical of military spending and many of his supporters believe that he will reduce it to help balance the budget. Unfortunately for them, this is the issue where he has the least credibility. Sanders has continuously voted for more Defense spending, raising the budget by billions of dollars. He seems like a staunch isolationist who wants to withdraw America from the rest of the world, but when you look behind the man and at the facts, you will see that he lies like any other politician does. Whenever a liberal complains about George W. Bush's spending during the War on Terror, just remember that Sanders was with the president when it came to providing more funds. I have no idea why people view him as unique, except for his atrocious fiscal policy proposals that even Democratic economists oppose.

To win the 1983 general election in the United Kingdom, the Labour Party led by Michael Foot tried to defeat Conservative incumbent Margaret Thatcher by moving further to the left. It made unions and socialists happy, which fired them up to vote, but failed to appeal to others. One politician would call their party manifesto "the longest suicide note in history." On voting day, the Labour Party suffered one of the worst defeats in British electoral history and Foot resigned as party leader. Sanders' policy papers might not beat Foot's in length, but they certainly are national suicide when it comes to what he wants to do. That's why you shouldn't vote for Bernie Sanders.