Mark Spitznagel: At What Price Safety?

Mark Spitznagel: At What Price Safety?

07/27/2021Mark Spitznagel

Editor's note: Mark Spitznagel is President and Chief Investment Officer for Universa Investments. He has written about risk mitigation and "tail hedging" in his books The Dao of Capital and Safe HavenHe is a well-read student of Austrian economics, and has applied the insights of Mises and others to his professional work. This editorial, originally published July 20 in the Financial Times here, provides compelling insights into Mr. Spiztnagel's view of "risk mitigation irony": as politicians and investors attempt to mitigate risk, they miss the "unseen," which Frédéric Bastiat admonished us to consider. For Spitznagel, both politicians and investors fail to understand the true (i.e., full) costs of their risk mitigation strategies—the former overcorrect for covid dangers, the latter overcorrect for crashes. For those interested in the distinction between uncertainty and risk in economics, see Frank Knight's Risk, Uncertainty, and Profit and Mises's Human Action, chap. 6.

From public policy to private investing, it is the central question of our time: how high a price should we pay to keep ourselves safe from harm?

And this begs even more fundamental questions: should risk mitigation come at a cost at all, or should it rather come with rewards? That is, shouldn’t risk mitigation be “cost-effective”? And if not, what is it good for? 

Think of your life like an archer releasing just one single arrow at a target. Naturally, you want to make your one shot at life a good one—to hit your bullseye—and this is why you mitigate your risks: to improve your precision (or the tightness of the grouping of your potential arrows) as well as your accuracy (or the closeness of that potential grouping to your bullseye). We often lose sight of this: safety is instead perceived as improving precision (removing our bad potential arrows) at the expense of accuracy.

The fact is, safety from risk can be exceedingly costly. As a cure, it is often worse than the disease. And what’s worse, the costs are often hidden; they are errors of omission (the great shots that could have been), even as they mitigate errors of commission (the bad shots). The latter are the errors we easily notice; ignoring the former for the latter is a costly fallacy.

Of course, we expect politicians to commit this risk mitigation irony. Ours is the great age of government interventionism—from corporate bailouts to extraordinary levels of debt-fueled fiscal spending and central bank market manipulations. Fallaciously ignoring errors of omission to avoid errors of commission essentially is the job of politics, as every government programme involves hidden opportunity costs, with winners and losers on each side.

More surprising, even investors engage in risk mitigation irony as well. They strive to do something—anything—to mitigate risk, even if it impairs their portfolios and defeats the purpose. The vast majority of presumed risk mitigation strategies leave errors of omission in their wake (i.e. underperformance), all in the name of avoiding losses from falling markets.

Modern finance’s dogma of diversification is built around this very idea. Consider diversifying “haven” investments such as bonds or, God forbid, hedge funds. Over time, they exact a net cost on portfolios’ real wealth by lowering compound growth rates in the name of lower risk. They have thus done more harm than good.

The problem is, such safe havens simply do not provide very much (if any) portfolio protection when it matters; therefore, the only way for them to ever provide meaningful protection is by representing a very large allocation within a portfolio. This very large allocation will naturally create a cost burden, or drag, when times are good—or most of the time—and ultimately on average. Over time, your wealth would have been safer with no haven at all.

An overallocation to bonds and other risk mitigation strategies is the principal reason why public pensions remain underfunded today—an average funding ratio in the US of around 75 per cent—despite the greatest stock market bull run in history.

For instance, a simple 60/40 stocks/bonds portfolio underperformed the S&P 500 alone by over 250 per cent cumulatively over the past 25 years. What was the point of those bonds again? Cassandras typically and ironically lose more in their safety interventions than they would have lost to that which they seek safety from.

Most investor interventionism against looming market crashes ultimately leads to lower compound returns than those crashes would have cost them. Markets have scared us far more than they have harmed us.

While Cassandras may make great career politicians and market commentators, they have proven very costly in public policy and in investing. We know that times are fraught with uncertainty, and the financial markets have perhaps never been more vulnerable to a crash. But should we seek safety such that we are worse off regardless of what happens?

We should aim our arrows such that we mitigate our bad potential shots and, as a direct result, raise our chance of hitting our bullseye. Our risk mitigation must be cost-effective. This is far easier said than done. But by the simple act of recognizing the problem of the deceptive, long-term costs of risk mitigation, we can make headway. If history is any guide, this might just be the most valuable and profitable thing that any investor can focus on.

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The Midterm Lesson: Unserious People Can't Stop the Left

11/14/2022Tho Bishop
Listen to the Audio Mises Wire version of this article.

This year’s midterms came at a time when most Americans are poorer than they were two years ago, violent crime is on the rise, and exit polls seemed to unanimously point to voters prioritizing these basic facts over abortion rights and “democracy.” Everything was primed for a Republican red wave to set the table for a potential sixty-seat Senate majority in 2024.

Instead, Republicans underperformed historical midterm trends. The only “red tsunami” was in Florida, where Governor Ron DeSantis won with the largest margin since 1868.

The aftermath has reopened wounds that were inflicted when Donald Trump mounted his hostile takeover of the Republican Party. Beltway Republicans, who had largely remained disciplined in holding fire on Trump since his victory in 2016, have unleashed their pent-up rage, trying to scapegoat him for all of the Grand Old Party’s electoral woes.

No one is helping their case more than the former president. DeSantis’s dominating victory has further elevated the one political figure who presents a sincere risk to Trump’s position as a de facto political leader. What started as some public jabs against the governor before the midterms have now evolved into a full-on attack calling into question DeSantis’s “class” for refusing to pledge that he won’t run for president in 2024.

Unfortunately for Americans sincerely concerned about the rising threats presented by the modern Left, Trump’s in-character tantrums distract from a much larger problem: the political institutions of the American Right are led by unserious, inadequate individuals. If Republicans cannot recognize and properly respond to this, the Democrat Party will continue to enjoy the privilege of being the political equivalent of the Harlem Globetrotters, again dunking on the Washington Generals.

The greatest blame for the red trickle should be directed at Republican McLeadership: Kevin McCarthy, Mitch McConnell, and Ronna Romney McDaniels of the Republican National Committee (RNC).

McCarthy has spent his time as Republican House leader largely stumbling through inner-party politics, such as propping up the sinister Liz Cheney in House leadership before ousting her for refusing to follow his very stern warnings not to antagonize the party base. His attempt at crafting a vision for what Republicans do with power includes such vapid statements as “A Future Built on Freedom.” As party leader, he prioritized dedicating millions of dollars to attacking Republicans he feared wouldn’t follow his lead, such as Florida’s Anthony Sabatini and Washington’s Joe Kent, in primaries.

McCarthy’s performance can only be defended by contrasting it with McConnell’s. With the ancient turtle of the Senate facing his own budding rivalry with DeSantis’s successor turned senator, Rick Scott, McConnell’s Senate Leadership Fund was responsible for reallocating almost $10 million dollars away from Arizona’s tight senate race and to Alaska, propping up loyal swamp creature Lisa Murkowski against another Republican competing in the state’s jungle election. McConnell also enjoys the distinction of being the single most hated Republican in Washington, with an approval rating over twice as low as Donald Trump’s.

Hating Mitch McConnell is one of the few issues that can unite an increasingly polarized America.

Of course, many Republicans voted for Trump in 2016 in large part to remove the McCarthys, McConnells, and Romneys from power. Instead, Donald Trump let them back in, making Paul Ryan speaker in 2017, bringing McConnell’s wife onto his cabinet, endorsing Mitt Romney for Senate, and making his niece leader of the RNC. Additionally, Trumpworld raised over $100 million this election cycle for the Save America PAC to help finance Trump-style candidates. Less than $15 million was spent.

At a time when so many Americans wanted Donald Trump to lead the Republican Party, he outsourced that responsibility to his enemies that now want him purged.

While Trump’s brand of populist politics was never perfect, his instincts were always better than traditional Washington’s: a folk opposition to “stupid wars,” an emphasis on revitalizing the American economy, spicy rhetoric lambasting the worst of the Beltway’s political class, attacks on the corporate press, and a recognition that the regime security state was a threat to his liberty (and by extension, ours). As a right-wing populist leader, he thus embodied many of the characteristics that drew Murray Rothbard to Pat Buchanan’s 1992 presidential campaign.

Unfortunately, populism is a political strategy, not an end in itself. To his credit, Trump’s disruption of neoconservative hegemony over the GOP has manifested itself in the intriguing National Conservativism project, which could yet still provide the sort of intellectual artifice needed to reverse American decline. That requires, however, leadership capable of wielding power in a way that truly threatens the regime.

The problems America faces currently, however, are issues that politics alone are inadequate to address.

The current inflationary struggles undermining American quality of life result from the bipartisan empowerment of a Federal Reserve that—along with central banks worldwide—has engaged in decades-long monetary hedonism. Policies that have been disastrous for real America have been a boon for financial institutions and large corporations that have been happy to serve as an extension of the federal regime and to finance campaigns in return.

The third rail of American politics, Social Security, Medicare, Medicaid, and various other social welfare programs, suffers from a basic math program. The size of unfunded liabilities continues to grow as America itself becomes older. Young Americans are getting married later and less often, resulting in fewer children and creating new economic stress that many seek to address with increased immigration. The social costs of declining birth rates and changing migration patterns have additional consequences that economics alone can’t analyze.

Additionally, the Democrats’ overperformance in the midterms has identified major cultural concerns. Many voters have demonstrated they are more offended by the idea of a fifteen-week limit on abortion than by tyrannical covid lockdowns. Maybe there is a connection between an election that elevated a mentally damaged man to the Senate and a voter base that refused to punish governors whose policies are responsible for damaging the intellectual development of children.

These issues aren’t solved with elections but with a profound change in America’s economic, spiritual, and cultural realities.

The question now is what comes next.

As I noted after Biden’s inauguration, Trump’s moment has been one of the most exciting political developments in modern American electoral history. This remains true, even if the man responsible for its creation seems increasingly ill-prepared to lead it. Trumpers are still better than Trump.

This is why the brightest spot for Republicans in 2022 appears to be the best hope for American politics: Ron DeSantis. The question now is, Can he hold up in the face of a category 5 Trump storm after so many others have not?

Several points indicate DeSantis may be different. 1) He himself is a product of Trump, as the former president has noted. DeSantis went from afterthought to Republican nominee only after Trump’s endorsement, and his primary campaign was dedicated to reminding people just how dedicated he was to the MAGA brand. 2) He’s an executive with an unparalleled record of covid-era competency, effectively resisting both federal and corporate tyranny, genuinely increasing the quality of life of his population, and 3) now he's an electoral powerhouse reshaping the politics of his state.

For the first time, Trump’s attacks on a rival seem to be coming from a place of weakness, not from a place of New York swagger.

DeSantis has also demonstrated qualities unique in modern American politics. For one, he has been able to surround himself with truly talented people, such as his communications general, Christina Pushaw, who successfully pivot a media-created narrative about a “Don’t Say Gay” bill into a conservative war on “groomers.” DeSantis is also, well, intelligent. As Dr. Jay Bhattacharya told Tom Woods last year, he found it “remarkable” that the governor “knew all of the details” when discussing scientific studies on covid that did not fit the regime’s narrative.

He was even able to rebuild a bridge faster than several states count ballots.

America’s issues, however, are bigger than covid. Will DeSantis be able to apply similar distrust of “policy experts” in other areas of deeply ingrained Washington corruption, such as foreign policy, monetary policy, and the national security state? Skepticism of any politician is always warranted.

Ultimately, though, this year’s midterm disappointment for Americans hoping the lunacy of the Left would fundamentally weaken the Democrat Party highlights that the very real problems we face will not fall under their own weight. The antihuman threat of progressivism continues to rise, no matter how visually absurdly it manifests itself.

For those with a sincere interest in protecting themselves, their families, and future generations from the horror, now is the time to start formulating real solutions and strategies to engage it.

We can no longer afford unserious people.

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When So-Called Financial Genius Failed—Again

When on Monday FTX CEO Sam Bankman-Fried (hereafter referred to as SBF) took to Twitter to reassure depositors that the third-largest cryptocurrency firm’s liquidity was fine, one could be forgiven for hearing echoes of Bear and Lehman’s c-suiters talking to CNBC to reassure their respective sources of funding, their short-term lenders, that their liquidity was also fine, when in fact their own firms were in their death throes. That sense of foreboding was temporarily eased when on Wednesday it was announced that Binance, the market’s largest crypto firm, would rescue FTX by absorbing it in a takeover reminiscent of the one that saw J.P. Morgan gobble up the smaller Bear Stearns during the onset of the Great Financial Crisis. 

However, after just a few hours of Binance’s due diligence team looking over its rival’s books it was announced Thursday that the deal was off. As a CoinDesk report the week prior had noted uneasily, FTX had put much of its depositors’ money into “hard to sell” positions. These included large equity stakes taken over the summer in troubled crypto-players BlockFi and Voyager, as well as large loans to one of SBF’s other business ventures, the Hong Kong based crypto trading firm Alameda. Facing a $4 billion dollar shortfall, the firm announced Friday FTX and all its related companies were filing for bankruptcy. 

It marks the largest collapse of a crypto player to date and sparked a sell off in crypto markets already badly beaten down by rising interest rates.

The irony that it was Binance that had first dangled salvation before taking it away was not lost on informed observers of the crypto space. Following a series of public spats over SBF’s perceived friendliness toward financial regulators having gone too far, Binance’s announcement that it would begin closing its large position in FTX helped spark the run that eventually killed the firm. 

The problem, apart from Binance’s impending withdrawal, was the signal it sent to the market. Selling its FTT holdings, the digital token underlying the FTX network, worth billions of dollars at the time, would tank the price. If you know a whale is selling, it’s best to be out first, and that logic prompted huge withdrawals. For its part, meeting these calls for customer cash became increasingly difficult for FTX. Even if it had been able to access the FTT it had lent to Alameda, which was being used as collateral to trading counterparties, selling it for cash at distressed prices would have likely blown up both firms. On the one hand, selling so much FTT would have tanked the price, putting FTX in dire financial straits; while on the other, the fall in the asset’s value would have triggered a cascade of margin calls on Alameda’s outstanding positions.

Just like Bear and Lehman, whose houses of mortgage-backed collateral collapsed when a sudden panic over their quality meant the positions were effectively unsaleable and would not be taken as collateral, FTX and its related companies had no assets they could sell quickly to raise cash and no collateral any counterparty wanted to take.

From being worth billions to being bankrupt in less than a week, given the similarities between the implosion of FTX and the financial crises faced by other firms in the past, several recurring lessons seem worth pointing out:

First, hold a diverse balance sheet. Much of the panic that results in the variations between asset classes going to one is caused by firms realizing the instability large un-diversified counterparties pose to the system. From Long Term Capital Management’s short equity volatility position to the investment banks that bet it all on their subprime securitization businesses, a lack of high-grade liquid assets will always leave a firm on knife’s edge. 

Second, when credit conditions begin to tighten firms need to either deleverage or else carefully manage their liquidity. Neither of those things happened. 

Third, when depositing money at an institution, one is in effect making a loan. The interest rate, therefore, should be seen as an indicator of the level of risk a depositor is taking on. In the case of crypto lenders, operating without the Federal Reserve’s safety net, the interest rate offered to attract lenders is generally several times higher than one could get at a legacy deposit taking institution. The reason, as just evidenced, is that these firms are paying buyers for taking on the risk of a complete loss of capital.

Fourth, beware obvious conflicts of interest. Just as it should have been a red flag that the ratings agencies were being paid by the banks for their ratings and had to compete with one another to retain the lucrative business of the big banks, SBF’s role as unencumbered head of both FTX and Alameda deserved much more scrutiny than it got.

Finally, it isn’t just “dumb” retail investors that are on the hook for huge losses. Several large institutional investors face a combined billion dollars in potential write downs. Such “smart” money made all the classic mistakes that have seen banks from UBS and Credit Suisse to Merrill Lynch get themselves into loads of trouble before. Related hedge funds or special investment vehicles that could potentially expose a lender to losses need to be carefully supervised, and by at least two different people. 

Taken in by a story told by a charismatic young entrepreneur, these investors all chased yield at their peril, whether they knew it or not.

One can only hope the inevitable calls for more regulation of the crypto space and an expansion of the powers of the Consumer Protection Bureau will be deterred by cooler heads, who recognize there was nothing so special in the death of FTX at all. 

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How to Lose $143 Billion Trading Stocks

11/11/2022Robert Aro

Now here’s the headline!

Swiss National Bank loses nearly $143 billion in first nine months

Reuters reported the Q3 result last week, in which Switzerland’s publicly traded central bank (SNB) suffered its largest loss in its 115-year history. The news release reads beyond belief, not because of the unprecedented amount of value that was lost, but just how nonchalantly this legal counterfeiting ring is being downplayed.

The loss … was slightly more than the annual economic output of Morocco ($132 billion), but the central bank does not face bankruptcy thanks to its ability to create money.

Justification for the SNB owning stocks has always been the same:

The SNB made a loss of 141 billion francs from its foreign-currency positions as the bonds and stocks bought during its campaign to stem the appreciation of the safe-haven franc slid in value.

As the story goes, the Swiss Franc is too high. To weaken their currency, the SNB must print money. And because money must go somewhere, they’ve found it best to put it towards owning US equities.

Mainstream economists seldom consider ideas such as the universal application of an economic theory. If this stock purchase to weaken the Franc was a good idea, then the Fed should do the same and own $10 billion of Apple shares, giving the Fed a healthy dividend, as stated above: “thanks to its ability to create money.”

And then shouldn’t Canada’s central bank do the same? I.e., inflating their currency so much to help boost exports, as is often cited as the reason to depreciate currency.

Few, if any, mainstream economists appear bothered by having a central bank intervene in the stock market. UBS economists, Alessandro Bee, did not address this concern, but dismissed the capital destruction entirely, opting to try to explain how:

These losses may sound like a lot, but the SNB is not a normal company.

He went on to say that “normal bankruptcy rules” need not apply to the SNB.

A finance director of a Swiss Canton, Heinz Taennler, was quoted similarly reassuring that losing $143 billion wasn’t as bad it sounds:

The SNB is not a normal bank, it's a central bank which has other tasks such as price stability and protecting the Swiss economy.

As for any comment on the $143 billion loss, none was given. But SNB Vice Chairman Martin Schlegal noted that a negative equity position wouldn’t change much of anything… After all, bankruptcy is difficult when you can create an infinite amount of cash.

The Vice Chairman was quoted:

We can pursue our tasks and fulfill our mandate even with negative equity capital… Nevertheless, it is important that we have enough equity. It helps the credibility of a central bank if it is well capitalized.

Must be nice to be a central bank! But not all that glitters is gold. The current dividend payout on each Swiss National Bank share (currently trading at $4,250 USD) is only 0.36%; hardly enough to keep up with any measurement of (price) inflation that  central banks are causing at the moment.

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Podcast: The Fed Is Screwing Up Housing Again

11/09/2022Ryan McMaken

Tom Woods and I discuss how housing regulation and monetary policy have led to inflation, shortages, and a host of economic problems: Ep. 2233, The Fed Is Screwing Up Housing Again.

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5 Months of QT Down

11/08/2022Robert Aro

We’ve made it to November. The Fed continues its Quantitative Tightening (QT) path. With each passing day the cries for a Fed Pivot grow. On some level we must accept that the economic outlook for the near-term future does not look good.

In 4 Months of QT Down, on October 5 the total balance sheet was standing at $8,759,053,000,000 ($8.76 trillion). The latest release on November 2 the balance stood at $8.68 trillion.

The reduction in October is as follows:

  • On October 5 the US Treasury (UST) balance was $5.634 trillion. The following month, as on November 2, it stood at $5.575 trillion for a decrease of roughly $59 billion.
  • On October 5 the Mortgage-Backed Security (MBS) balance was $2.698 trillion. The following month, as on November 2, it stood at $2.679 trillion for a decrease of roughly $19 billion.   

Almost $80 billion in a month is not terribly bad for the Fed since the maximum amount they could reduce by is just under $100 billion a month, and this may have been one of the largest reductions this year.

Any mention of a Fed Pivot, or even consideration of increasing the balance sheet is still not officially on their radar. In his press conference last week Powell did not use the word Pivot, instead reiterated how they are committed to “bringing inflation back down” to their 2 percent goal.

But he did mention uncertainty around the pace of rate increases and how high they might eventually climb.

At some point… it will become appropriate to slow the pace of increases, as we approach the level of interest rates that will be sufficiently restrictive to bring inflation down to our 2 percent goal. There is significant uncertainty around that level of interest rates.

Reminded us that:

Even so, we still have some ways to go, and incoming data since our last meeting suggest that the ultimate level of interest rates will be higher than previously expected.

With much uncertainty concerning the future, Powell remains committed to downplaying the inevitable downturn. After raising rates by 75-bps last week, he was asked again about the soft landing. He acknowledged the landing window has narrowed, then eventually answered:

I think no one knows whether there's going to be a recession or not, and if so, how bad that recession would be.

How bad something will be in the future can only be a best guess. Correctly speculating how bad can be quite lucrative. However, the important takeaway is to first understand that, whether it’s called a recession or depression, it’s (probably) not going to be the end of the world, even if our economic future looks bleak. The second thing to understand is that this is all primarily due to government intervention, aided by their anti-capitalist central bank. Mainstream academics and the media would say this to the general public, but how often have they ever provided the general public with useful information?

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For the Midterms to Matter, the GOP Needs More MTG, Less McConnell

11/08/2022Tho Bishop
Listen to the Audio Mises Wire version of this article.

Rather than an election day, for most of the country, today is the conclusion of something resembling an election month. While one would expect any first-world nation to be capable of concluding an election on election night, the same institutions that fortified 2020 have already warned us that the official count could take days or weeks. It is, of course, the most important election of our life. Democracy itself is on the ballot.

While regular readers of the Mises Institute are right to read the last two lines with a proper amount of cynical sarcasm, perhaps even the most devoted anarchist may sense that there is something a bit different about this midterm season.

America is stumbling toward nuclear war in much the same way our president climbs the stairs of Air Force One. Almost everyone reading this has been made poorer in the past two years, factoring in the impact of inflation on your purchasing power, the current state of your 401(k), or the value of your home. In the past several years, the quality of your life has been dramatically impacted by the quality of your governor.

For quite a while now, America has enjoyed an existence of privilege, despite the true lunacy of our political system. As a result, our representatives in Washington have become increasingly mediocre and disinterested in policy. In their defense, most members have very little to say about legislation. Moreover, voting for president seems to have minimal impact on issues of great importance; antiwar presidents find new countries to invade—or at least bomb—while serious financial matters are either left to experts on Wall Street or academics handsomely paid for twenty-minute speeches.

The true distinctions between administrations are the smaller-scale ways they embarrass us. In that sense, the Biden administration’s habit of promoting freaks and fetishists to serious governing positions does help it stand out.

The result is a government that blunders from one debacle to another. No one can ever honestly claim to be in charge, so no one is ever honestly held accountable. The worst-case scenario for a Beltway bigwig is being forced out of the public sector earlier than expected, and always with a higher-paying gig waiting for them.

Have Americans had enough of this?

For the past few decades, much of the most explicit destruction of America’s buffoonish regime has been beyond our borders. Hundreds of thousands dead. Multiple nations thrown into chaos. Economic instability with consequences we will never truly understand.

The cost to Americans was less obvious. The brunt of military deaths, and survivors with trauma, falls on a small minority of the country. The damage that economic policies connected to the regime’s ambitions has done to communities took place over time—the politics of the boiling frog cliché.

But Americans are no longer dealing with gradual decay but an abrupt collapse of faith in our institutions. Rightfully so. We were lied into war. Lied into inflationary policies. Lied to about the value of college. Lied to about flattening the curve. Lied to about vaccines. Lied to in ways that we have completely forgotten.

In the future, more will come to recognize the degree to which they were lied to about Social Security. Lied to about Medicare and Medicaid. Lied to about the security of their pensions. Lied to about the quality of the future our vaguely defined social contract was supposed to guarantee.

Are Americans ready to hold people accountable for these lies?

If so, today’s elections are not enough. If anything, contemporary political history has repeatedly shown how little elections matter. Barack Obama did not bring change. Brexit did not restore British sovereignty. The election of Donald Trump and Jair Bolsonaro did not drain their nations’ respective swamps.

Elections are, at best, the beginnings of political change. But if not followed with deliberate action and a transformative ideological reprogramming of the institutions, elections’ lasting impact will most significantly be felt in the emotions of nostalgia from those who sincerely hoped a new dawn was about to emerge.

So, can this year’s midterms offer any hope of meaningful change beyond the joy of watching the hysterics of corporate journalists?

There is perhaps the most reason for optimism in a handful of states with intriguing governors’ races.

New York’s governor-imposed Kathy Hochul is in desperation mode in her election against (pro-Trump!) Congressman Lee Zeldin. This is even though thousands of would-be Zeldin voters have already escaped to Ron DeSantis’s Florida. This would suggest that concerns over rampant crime will remove Democrats from positions of power in both New York and San Francisco in 2022. If this removal doesn’t result in a serious reevaluation of how crime and the protection of property are handled in the dense urban areas Democrats almost universally control, there is a clear opportunity for genuine political realignment in American cities.

Speaking of crime, there are a variety of covid tyrants who deserve a fate worse than political defeat but certainly deserve at least that. The ghoulish Gretchen Whitmer of Michigan, Tony Evers of Wisconsin, and Steve Sisolak of Nevada are the three that seem to be the most vulnerable. In particular, Whitmer, who at one point made public service announcements in which she smiled while demanding mothers in labor wear a mask at all times, offers a perfect embodiment of the worst type of political sociopath. In a better world, she would face criminal charges—as the heroic Sheriff Dar Leaf of Barry County, Michigan has suggested—but a political defeat to the onetime vice presidential contender would be meaningful.

The biggest political problems, though, are the seemingly insurmountable cancers at the federal level.

While it appears inevitable that the House will swing back into the hands of the Republican Party, it seems just as inevitable that there will be no significant shake-up to Republican leadership. The optimism for anything positive emerging from a Red House, beyond the virtues of divided government, comes from the loudest parts of the MAGA Caucus. Here, firebrands like Marjorie Taylor Greene and Matt Gaetz have been pounding the table for the GOP to investigate Dr. Anthony Fauci, Attorney General Merrick Garland, Hunter Biden, and various other Beltway villains.

The integrity of the party demands their rhetoric become action.

If a Republican-controlled Congress can’t treat any of the villains of the administrative state as seriously as Democrats have treated Steve Bannon or Roger Stone, then the GOP’s legacy as controlled opposition continues.

Their other priority? Shaking up foreign policy, particularly the seemingly limitless appetite Washington has for unaccountable aid grants to the Ukrainian government. Both MTG and Gaetz have vowed to fight so that “not another penny will go to Ukraine.”

This is where things get interesting. It is not rare for there to be some vocal congressional critics of the uniparty foreign policy mission of the day—the late John McCain would call such colleagues “wacko birds.” In Gaetz and MTG, however, you have two of the most charismatic, Trump-y, and nationally recognized members of the Republican Caucus demanding a change in American policy in terms that resonate with average Americans. And it appears to be having an impact.

A recent Wall Street Journal poll showed that 48 percent of Republican voters have soured on America’s limitless support for the Zelensky regime, up from 6 percent in its last poll.

Some Republican candidates have understood this instinctually. Ohio Senate candidate J.D. Vance actively campaigned against US support during his primary in a state with a significant Ukrainian population. Very Serious Pundits suggested this would doom him. Instead, he won by almost 10 percent. Arizona Senate candidate Blake Masters, a noted Murray Rothbard respecter, also opposed any military aid while running for the seat that McCain once held. Even in the shadow of the Washington beltway, retired navy captain Hung Cao opposed Ukrainian support in a surprisingly tight race in a D+6 district.

The result is that even dull Kevin McCarthy has raised the alarm that future Ukrainian aid will face a battle in the House, evoking howls from Mitch McConnell and Mike Pence.

Of course, campaign rhetoric is easy. Follow-through is quite different. It is notable that this shift in Republican campaign rhetoric has followed a change within traditional Conservative Inc. institutions. For example, the Heritage Foundation, under Kevin Roberts’s leadership, has signaled a new foreign policy ideology opposing “hyper interventionism and soulless neoliberal globalism” and defending “what’s best for the American taxpayer.”

This is important. Elections come and go; the real battle is what happens in between.

There is broad recognition, including from Trump world, that the impact of Trump’s election was undermined by poor staffing—which was, in part, a byproduct of a lack of Beltway institutions reflecting a shift in governing ideology. Since 2016, organizations like the Conservative Partners Institute, founded by former Tea Party senator Jim DeMint, have risen to help address “America First” staffing. According to memos from the Trump world, the top priority of a potential Trump administration 2.0 is a massive purge of the federal bureaucracy. This rhetoric is also shared by Vance and Masters, both candidates who enjoyed not only Trump endorsements but Peter Theil’s funding.

The potential MAGA additions to the Senate have one other possible way to make a midterm red wave matter: removing Mitch McConnell from his position as leader. Cocaine Mitch was able to largely co-opt the Trump administration, only to publicly burn all bridges following the 2020 election. McConnell has been able to act unchallenged for quite some time, in part because his ability to fundraise and wield power was unrivaled by the Republican senatorial caucus. In 2020, however, in stepped a Florida man with an impressively effective record of his own: Rick Scott.

While ideologically DeSantis’s predecessor won’t excite many Austro-libertarians, he has the two most important assets to challenge the Senate leadership: money and ambition. He has also been a public defender of Trump’s Senate nominees, jabbing McConnell’s lackluster support for Blake Masters. However, Scott’s greatest vulnerability is publicly admitting that America’s social programs are financially unsustainable, potentially a deadly sin in Washington that will test the strength of Trump’s influence on the Republican caucus most isolated from popular opinion.

If, however, McConnell were somehow able to be dethroned as the king of the Republican Senate, it would reflect a seismic shift in the Beltway GOP, a change that would in many ways be more significant than Trump’s de facto hostile takeover of 2016. A change in actual party structure redefines what is politically possible. Whether or not this would reflect a genuine shift in ideology or simply the changing of nameplates on the board is an open question.

Of course, any discussion of the midterms themselves assumes that any degree of integrity remains in the election system. While many states have tightened up some of the most vulnerable aspects of the 2020 covid-impacted elections, already legal clouds are forming over Pennsylvania, a race to the bottom between a dual-citizen reality-show host from New Jersey and a mentally damaged thug in a hoodie. John Fetterman is already trying to sue improper vote-by-mail ballots into the count. There will be lawyers.

More troubling is the return of familiar rhetoric from all the usual sources. Don’t fall for a “Red Mirage,” says ABC. Election results will be delayed, reminds Facebook. Given the near-unanimously ominous state of polls for the Democrats, it seems alarming that President Joe Biden is warning of election deniers that won’t accept the result of elections they are favored in. Is the night already rigged for his party?

Of course, confusing, self-sabotaging rhetoric is what one should come to expect from our sunsetting commander-in-chief.

In conclusion, today’s midterm elections are most likely to produce little serious change beyond the feeling of satisfaction at watching bad people defeated. This does not, however, mean that there are no indications that there is the potential for something more. Any serious momentum against the regime requires more than replacing team blue with team red; it requires a serious ideological shift within the halls of power and the political will to purge, reform, and ideally destroy the administrative state.

Most Republicans elected today do not have the courage to do that. Their election, however, has the potential to elevate the few that do. Particularly if those few are supported by well-funded, influential institutions that are dedicated to the same ideological shift.

The threat of nuclear war, historic inflation, and spiritual decay are very serious issues.

America desperately needs a serious attempt at addressing them.

Image source:
Gage Skidmore | Flickr
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In Defense of Migration

11/08/2022Per Bylund

Do people have a right to go wherever they want and for whatever reason they like? Certainly not. I have no right to use or occupy your rightful property without your permission. And the same applies for you and everyone with my property.

Do people have a right to migrate to whatever part of the world they please? They certainly do. If they don’t violate the life and property of another person, nobody has a right to limit theirs.

It should be easy to combine these two statements into one: my liberty ends where your liberty begins. Or: it is everyone’s right to not be coerced or aggressed upon. Or even: everyone has a right to be left alone on their property if they so wish.

But, unfortunately, even such simple, unambiguous statements tend to be both confused and confusing when the issue is migration. Part of the reason for is that we have emotional attachments to things that aren’t ours, such as the structure, ethics, culture, and perception of the society that we are embedded in. Part of it is that much of what relates to migration, including both its causes and implications, is a matter of policy. And, of course, part of it is also the existence of the State, including its impact on property both in the past and present, which always muddles the waters with respect to people’s rights and liberties.

Migration and Rights

From the perspective of individual rights, migration is not even an issue. People move about practically daily and all over the world: we travel to work and back; we go on road trips and vacation in foreign countries; we move to the other side of town or another state for a job or opportunity; we expatriate in pursuit of opportunities for ourselves and our families.

None of this is problematic and we largely take these things for granted. But it is also not free: without sufficient purchasing power, we are not able to afford to travel wherever and whenever we want. Or quit our jobs and live the rest of our lives on a paradise island somewhere.

On the other hand, opportunities arise in all kinds of places so it could very well be that we cannot afford not to move far away to pursue them.

In the end, what it comes down to is a personal valuation of the alternatives. For most, a great opportunity far away is not worth pursuing because it requires leaving people, customs, and familiar ways of life behind. That’s not for everyone. For others, sometimes many, the promise of the faraway opportunity is simply too good to let go.

But there are also arbitrary limitations imposed on us and our ability to move around. Passports and visa requirements, for example. Those are rights violations imposed by the State. The passport is your domestic State’s permission slip to leave and travel abroad and the visa is the permission slip to enter a territory controlled by another State.

Migration and Collectivism

Rights are always individual rights. There are no collective rights for the simple reason that those collectives comprise of individuals and individuals coming together don’t automagically gain more rights just because they are together. Not to mention that any right that the group supposedly has, but that the individuals do not have, is necessarily a violation of the individual’s rights.

Individuals can of course choose to associate or disassociate with others. They can also organize in formal groups that, through for example voluntary contracting or tacit understanding, choose to distance themselves from or exclude others – or limit who may join and who may not. But there is a difference between forming and upholding groups of individuals, even if they choose to share property or make it communally administrated, and superimposing groupness onto individuals.

I do not mean groupness as merely a matter of using descriptions. I am, for example, of Swedish origin and live in Tulsa, OK. You could say that I am part of the “Swedish community in Tulsa,” but it is only true in the descriptive sense (as a native Swede living in Tulsa). But I am not part or member of any type of community in Tulsa, Swedish or otherwise. It would likewise be true to say that I’m part of the 6’3”-and-taller community or the immigrant community, both which again are accurate – but as descriptions only. (I am indeed a tall Swedish immigrant in Tulsa.)

An actual community or group requires more than a mere description. You do not form a community by saying it – and you certainly do not form a community by a third party saying it (such as someone in New England making statements about “Oklahomans”) – regardless of how formal the pronouncement may appear (such as the State pronouncing who is a “citizen” and who is not, who has paid enough taxes and who has not, etc.).

There must be voluntary individual and mutual commitment by the individuals to make a community. And there must also be some form of discriminating rule by which to distinguish members from non-members. The latter largely requires the former: unless the individuals who choose to form a group dedicate property toward the group’s ends, the group isn’t much at all.

Needless to say, the commitment of property, effort, time, etc. toward the group’s ends needs to be voluntary and of justly owned property. Which leads us to the issue of the State.

Migration and the State

The State creates a group in the same sense that an attacker or thief does: it imposes its will on them by harming them and violating their individual rights. While the victims have their victimhood in common, this is a only description of what happened to them and insufficient to make them a community. But they can of course, building on their shared experiences and suffering, choose to form a group or community to support their own healing, prosecute or take revenge on the perpetrator, inform the world about the heinous crime committed, etc. The difference between the former and the latter should be clear.

The same applies to all violators of rights, including the greatest perpetrator of crime of all time: the State. Victims of the State can certainly form groups (such as taxpayer unions, political parties, secession movements, etc.) and they are free to do so (but the State might disagree). Merely being a victim of the State does not make you a member of a group, however – it only makes you a victim.

It is also a mistake to assume that a State’s violations of rights are limited to those who it permits to reside within the boundaries of its controlled territory. Certainly, the State focuses its aggression “at home” and directed toward its subjects. But few States are tyrants at home while letting the subjects of other States off the hook. Visa requirements and trade restrictions (tariffs, quotas, taxes, licensing requirements, etc.) are examples of violations of rights that go well beyond the State’s own subjects. Victimhood is not limited to the territorial claims of the State.

We already mentioned above that passports and visa requirements limit how, when, and where people can travel. These restrictions apply to crossing that invisible line that the State recognizes as the boundary of its territory. It matters not which in direction you intend (or try) to travel. Without the documentation required by the State, you are not allowed to cross. (Enforcement certainly varies, but try to enter “your” country without a passport and you’ll see how much your citizenship and/or residency matter…)

Migration vs. Rights?

Does this mean that anyone and everyone should, from the perspective of rights, be allowed to enter a country at will? Yes, it certainly does. Merely moving from one point to the other is not a violation of rights. It makes no difference if you move across the street, to the other side of town, or across an arbitrary line upheld by a criminal.

Being different from the majority or the norm is also not a rights violation.

But trampling on another’s property without permission certainly is. As is forcing one’s way into a community that wishes to exclude you. But for that to be the case an actual group must be formed. It is not enough to appeal to some generic descriptor, without buy-in from those who fit that very description. That’s just stating your opinion. Worse: it’s stating your opinion and suggesting that it implies a group of you and (many) others – whether or not they know it or agree with it. It’s a strange group that consists of “members” with no buy-in or voluntary commitment and where they neither need to know about nor agree with their assigned membership. In fact, that sounds close to a rights violation in itself.

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The Good, the Bad, and the 2022 Midterms

When voters who haven’t already voted go to the polls Tuesday to cast their ballots it will be with the Senate very much in play and Democrats needing a miracle to prevent a Republican takeover of the House. 

Midterms having historically provided rebukes to even reasonably successful first-term Presidents, with the party of the sitting President losing an average of twenty-eight and four House and Senate seats respectively, Democrats should consider themselves lucky: in the face of record-high inflation, skyrocketing mortgage rates, geopolitical chaos, and political witch hunts at home they stand an unlikely chance of retaining de facto control of the Senate.

In the House, things are setting up to just be terrible for the Democrats Tuesday, with FiveThirtyEight giving the party just a seventeen percent chance of holding on to the lower chamber. Particularly in the usually blue New England, Democrats find themselves trailing a host of self-described moderate or centrist Republicans. Indeed, having spent years fumbling the ball on basic issues like crime, Democrats are now having to allocate precious dollars down the homestretch to districts in places like suburban Portland, which have long been reliable strongholds. 

Needing to flip just five seats, polls suggest Republicans have been gaining ground in the closing weeks in the northeast and northwest, in places like New Hampshire and Washington, at the same time Democrats appear on the cusp of setting a new low in their appeal to rural and middle American voters. With suburban white women, a key demographic for the Democrats in 2018 and 2020, reportedly increasingly focused on bread-and-butter issues, the Democrats’ strategy of focusing on abortion rights looks like it may turn out to have been a mistake. The exception may be in Michigan, where a pro-life ballot proposal is on the ballot as well.

With the Senate currently split, for the Democrats to retain their de facto control they must defend all fourteen seats their party has up for reelection, a tall order given that the Cook Political Report projects they can count on just eleven. However, as Mitch McConnell hinted in August, “candidate quality” may just allow the Democrats to manage narrow wins in the few true toss-ups on the map. But while Dr. Oz, Herschel Walker, and Blake Masters have their deficiencies, in Pennsylvania, Georgia, and Arizona, the Democrats have seen their own deficient candidates’ large leads in polls evaporate over the past month. Due to a combination of poor debate performances, worsening inflation, and increased Republican ad spending, Pennsylvania, Georgia, and Arizona are all too close to call, with Nevada and increasingly New Hampshire in play for Republicans as well.

In Pennsylvania, sitting Lieutenant Governor John Fetterman (D) looked far from recovered from his midsummer stroke in the only debate; contrasted with a polished television performer in Dr. Oz (R), the fact that the political newcomer said little of substance but said it well beat the low bar set for him and helped put Pennsylvania in play.

Meanwhile, in Georgia the incumbent Raphael Warnock (D) has had difficulty generating any separation from the scandal-plagued football star and political novice Herschel Walker (R). Warnock, who likely only won his seat in the 2021 runoff special election against Kelly Loeffler because Trump sabotaged Republican turnout in the wake of his own defeat, has further been unable to distance himself from the Biden administration – a problem many fellow Democrats are encountering.

Burdened with the Democrats’ record over Biden’s first two years and a worsening economic outlook, Warnock has turned to the same playbook embraced by many Democrats facing tough races tomorrow: Doing what they can to distance themselves from the Biden administration where desirable, as on crime or the border, while drawing as much attention as possible to abortion rights and the “threat to democracy” posed by their GOP opponents.

Of course, many of these so-called threats to the survival of the state were helped through their GOP primaries by funding from Democratic groups seeking what they believed would be a more advantageous matchup in the eventual general election several months from then. The strategy, either entirely hypocritical, in that Democrats are purposefully stoking and amplifying what they know not to be an actual threat, or so cynical, in that Democrats really believe no Republican, even ones who voted to impeach Trump, can be trusted not to "destroy democracy," as to make the question of how that still much talked about "common ground" might be found moot. 

...Except, of course, when it comes to foreign policy, where both Republicans and Democrats consider courting conflict with either China, Russia, or both a given. 


The Arizona Senate race, featuring incumbent Russia-hawk Mark Kelly (D) and his China-hawk challenger Blake Masters (R), is representative of the general problem. Like the others, Arizona remains too close to call.

Having gotten the races he wanted, Trump will be watching along with everyone else Tuesday to see whether his anointed candidates are able to pull off what just a few months ago, seemed an improbable sweep.

With thirty-six governor’s mansions up for grabs, the races to watch may be in Florida, California, and Michigan where the question isn’t so much whether the incumbents will win but by how much. All three, Ron DeSantis (R), Gavin Newsom (D), and Gretchen Whitmer (D) have raised massive amounts of cash, built national profiles, have D.C. connections, and at this point look to be top names for their respective parties in 2028. A longer shot in her race, but nonetheless likely trying to position herself for another White House run, it will be interesting to see whether Stacey Abrams (D) will this time acknowledge the outcome of her projected loss to incumbent Brian Kemp (R).

An amalgam of top polls unsurprisingly shows bread and butter issues dominating the preoccupations of voters, with geopolitics given particularly low priority. Also of note, but difficult to interpret, is the high percentage of voters who say they are concerned about threats to democracy: for both Democrats and Republicans, for their own reasons, claim democracy is under threat.

For Republicans, their midterm message has been consistent and straightforward: from crime to the economy, inflation and the border, the relationship between parents and schools, Joe Biden and the Democrats are screwing it all up.

While the New York Times reported that, as early as late August, some Democrats privately favored moving to confront Republicans directly over these issues rather than skirting them with continued emphasis on abortion access and attacks on their rivals’ candidacies rather than policies, to try and make the case to voters that Republicans will be unable to seriously slow inflation any faster than their Democratic colleagues, and further that hypothetical future cuts by Republicans to health care or entitlements would hurt the average American, the shift in messaging never materialized.

One note of caution for GOP optimists remains. For despite the polls showing Republicans making gains in the weeks and days leading up to the election, a reported record number of mail in and early votes will need to be added to the tallies. Considering prior mail-in voting patterns favored Democrats, as did polls in some critical battleground states until just a few weeks ago, a repeat of the late whipsaw swings in vote totals seen in 2020 might be again on display and may leave us waiting until Wednesday to know whether the Republicans have captured both chambers of Congress.

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Go vote (But Only if You Want To)

11/05/2022L.W. Blakely

It’s an even year in November, so we know what that means.

Tuesday’s election is rolling around and aside from the plague of attack ads on your television screen, oodles of political spam mail and yard signs, it’s time for everyone to start telling you how important it is to “get out and go vote.”

I remember these people in college. They’d spend all day on the concourse passing out t-shirts and obnoxiously screeching out of a megaphone at innocent pedestrians trying to avoid being late for class.

“Your voice matters,” they’d say. “This is your chance to change the world.”

Yet the same people didn’t necessarily approve of me using my voice when they realized it wasn’t being used to advocate for a socialist utopia.

It’s not just college students either.

Our Big Tech overlords Facebook and Twitter have both launched campaigns to encourage users in the United States to register to vote.

The platforms present messages on certain user's home screens, but not everyone gets them.

Low voter turnout

Why do these people feel the need to encourage others to vote anyway?

The typical excuse is that voter turnout is so low.

According to Statistica, voter turnout is higher than its all-time low in 2014, skyrocketing in 2018 potentially due to the contentious presidential election just two years prior. Despite being higher than any midterm election after the Watergate scandal, only 49% of eligible Americans voted.

A broken system

But if so many people don’t care enough to vote, why should they? I mean, can you blame them?

It doesn’t take a genius to see how our system is broken beyond repair. Politicians make promises every other year, and hardly any get answered. Nevertheless, they consistently manage to increase taxes, pass more invasive regulations and drive inflation through the roof.

And they might spend billions on unnecessary wars and drone strike a few innocent children overseas while they’re at it.

Both candidates always stink.

Politics has its way of weeding the good guys out and welcoming the truly sinister with open arms. And the good guys that manage to stay are either rendered powerless or become no longer good.

Maybe some people just want some peace and quiet. They want to turn off the news and disassociate with all the angry talking heads online. Maybe the system is utterly collapsing, but they want to maintain some semblance of sanity and live a good life in spite of it.

Is more people voting necessarily good?

Perhaps you’re different. Perhaps you want to take advantage of your opportunity to vote. Well, why would you ever want more people voting?

Unless you knew those people were likely to vote for who you want them to (and perhaps that’s who this “your voice, your vote” marketing is intended to target) how would that help you or the “greater good” of society in any way?

The more people that vote in the same election, the less your vote counts. If 100 people are registered to vote in an election and you add 900 more, the weight of your vote just went from 1% to .1%.

In real elections, we’re dealing with much larger numbers of course. The weight of your individual vote is small enough as it is. What’s your incentive for making it even smaller?

Are most people knowledgeable enough about politics?

I find the idea that the more people that exercise their vote the better the outcomes will be to be ridiculous.

This assumes that the masses are 1) knowledgeable about the way politics works and 2) have a good idea about the way politics ought to work.

Us humans have a tendency to specialize. We have a division of labor and that’s a good thing.

In “Human Society,” Ludwig von Mises wrote that “work performed under the division of labor is more productive than isolated work and that man’s reason is capable of recognizing this truth.”

We have a limited focus, so therefore we develop expertise in specific skillsets and subjects and we exchange the fruits of our expertise for the fruits of the expertise of others.

Is politics the exception? Absolutely not! Understanding the intricate details of political theory, law, political mechanics, public relations and political marketing is simply not something 99% of people have time to do.

A middle school civics class doesn’t make you an expert.

Do most people even care?

And even if we did all know how exactly how the political system works, would we all have a good idea about how it should work? Would we all be voting for the “right” intentions? Would be voting for the sake of the “common good”? I doubt it.

Most people, if they do vote, will probably vote for the option they believe will present the most immediate reward to them. They’re worried about raising their kids, making a living and taking care of their loved ones.

They’re not sitting around thinking about ideology or political theory, trying to determine which policies will be best for everybody or which political system is the most morally correct.

They’ll vote for whatever they think will sustain their lifestyle or improve it, even if that means taking away from others, future generations included.

To the ideologues

Perhaps this is to the disdain of the believer in Democracy. But perhaps it also speaks to how ineffective Democracy is.

You’ll be pleased to know that I’m not suggesting any alternative political system. I just don’t believe in politics, and if I’m going to use it, it will be only in self-defense. I'll use politics from the bottom-up to protect myself from politics and to keep it from encroaching on my family as much as possible.

I’ll never use it to intentionally take from someone else or who hasn’t intentionally taken from me and I’ll never use it to impose some ideological system on millions of people.

If I do go vote, that’s what I’ll vote for.

If someone else believes they can effectively defend themselves to a certain degree by casting a vote, they’re welcome to do so too. I might even encourage them to do so, but I’m not going to go out of my way to present that message.

But to the people who want to take something from me, impose restrictions on my family or shove your ideas down my throat, I absolutely do not encourage you to vote. In fact, I wish you wouldn’t.

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The Forgotten Non-Populism of Donald Trump

11/05/2022Jake Scott

In studies of populism published in the last six years, be they book length or short articles, you are almost definitely going to come across a mention of President Donald Trump. Seen as the archetypal populist, Trump’s behaviours in and out of office have become so influential on the studies of populism that you simply can’t escape him when discussing it.

Yet, those of us who study populism are confronted with something of a conundrum regarding Donald Trump. It seems as though, in contrast with typical received wisdom, two things about Trump buck the populist trend: first, his personal unpopularity; and second, the persistence of the MAGA movement.

The figure of “the leader” is a mainstay in studies of populism, though the role he plays has often been contested: for some critical thinkers, such as Ernesto Laclau, the truth that all populist regimes take the name of their leader is an attempt to impose a heterogeneity on an otherwise disparate movement, whilst more mainstream thinkers, such as Benjamin Moffitt, argue that the leader is merely the “head” of the body politic. Regardless of the hair-splitting, there is an agreed-upon prominence given to the populist leader; the archetypal leader in this regard is Hugo Chavez, from whom Chavismo emerges into the political world as a specific style of politics derived from the former Venezuelan president.

But whilst Chavez is the archetypal left wing populist, Trump is hailed as the right’s answer. Corey Robin, for instance, claims in The Reactionary Mind that “Trump’s ascendancy suggests that the lower orders are no longer satisfied with the racial and imperial privileges the movement has offered them”. Seeking a leader with whom they - the “lower orders” - can directly communicate, the average Trump voter sought someone who was prepared to work on their behalf, put them first, and, importantly, speak like them. There’s no surprise, then, that Trump is thought of as the primary example of a right wing populist, and as his political popularity rocketed,

We are confronted with an immediate problem though: how do we explain Trump’s personal unpopularity? As Sarah Longwell wrote in the run up to the previous election:

[White] women generally loathe Trump. When I ask why they rate him as doing a bad job, they rarely pull their punches. He’s a “narcissist,” “bully,” and “racist”; he’s “unprofessional” and “embarrassing” as well. They are dismayed by the chaos, the tweeting, his general nastiness and divisiveness. They thought that the bombastic showman they saw on the campaign trail in 2016 was an act and that Trump would rise to the dignity of the presidency. They agree—with a mixture of horror and bemusement—that such a transformation never took place.

Yet many of them were prepared to vote for Trump - and 55 percent of white women did. Why? Longwell’s answer is that the “political enemies” were perceived to pose more of a threat to America than Trump: “their real contempt was reserved for Democrats and “the media,” whom they viewed as unnecessarily adversarial to Trump”.

You can agree with Longwell, or you can disagree, but the point remains: Trump’s personal popularity waned as his political popularity rose. Usually, the two rise and fall in tandem. If we return to Chavez, the man was both personally and politically popular all the way through his life: “the people around him might be corrupt thieves, they told me, but not Señor Chavez. Never Señor Chavez.”

It is here, I think, that we can understand Trump’s appeal through Make America Great Again, a phrase that began life as a campaign slogan but has since become a movement in itself. Typically, populist movements live and die with their leaders, so the fact that MAGA has outlived the presidency of the man who popularised the term is of particular importance. An article from the New York Times put it well: the hat was unusual because it was “promoting a slogan rather than a logo or a name, and frequently worn by the candidate himself”.

Going even further, what was once MAGA has now spread around the world - here in Britain, we see (very rarely, it must be said) “Make Britain Great Again” hats, but it is telling that our erstwhile Prime Minister Boris Johnson echoed the phrase. Likewise, France and Germany have each seen their variations of the phrase employed. How do we explain this? Is this populist?

The question becomes, “how can it be?” Donald Trump is no longer in the White House and, by all accounts, is unlikely to be again. Of course, nothing is ever set in stone - he may well return. Yet, his popularity is declining outside of office, as we are likely to expect, and polls suggest this is probably the end of his political career. Never take polls as gospel, of course, but it is telling.

So why does MAGA persist? And why does it haunt the Democrats so? Why did Joe Biden feel the need to say:

Donald Trump and the MAGA Republicans represent an extremism that threatens the very foundations of our republic… there is no question that the Republican Party today is dominated, driven, and intimidated by Donald Trump and the MAGA Republicans, and that is a threat to this country… MAGA forces are determined to take this country backwards — backwards to an America where there is no right to choose, no right to privacy, no right to contraception, no right to marry who you love.

It’s because, at a certain level, Biden is right, though whether he is cognizant of that fact is a different matter. MAGA does pose a persistent threat to the Democrats because, even though the movement’s head has been guillotined, the movement lives on. MAGA is likely here to stay, and shape American politics long after Trump has gone.

But what does this mean for our understanding populism? Does it mean Trump is not a populist? Not really: Trump’s politics evinced too many hallmarks of populism to not be considered as such, for instance the (at least) sceptical approach to institutional politics, the targeting of elites, and a desire to see the national prioritised over the international.

Yet, this does pose some more interesting questions, such as: what comes after populism? Molly McCann was absolutely right when she pointed that there was no going “back to normal” after Trump. I have argued elsewhere that populism is not a specific package of policies, but simply a manner of doing politics, but once that style has had its way, once it has torn down its targets, what then? Is it a case of “the great realignment” that Matthew Goodwin believes the Republicans are seizing on, or is it more that populism is an ephemeral, passing phenomenon? Britain and America offer two really interesting case studies of post-populist politics, but that is the matter for a different article.

The most interesting question, however, is what this means for the role of the leader in populism. As I say above, populism is usually imagined to live and die by the popularity of its leader and, by and large, it has, with figures like Chavez, Evo Morales, Juan Peron, and so on proving this as their countries struggled to govern properly once they had left. But if populism can morph and take on a life after the leader, does this mean we need to reimagine populism?

So much of Trump’s presidency has affected the study of populism, but it seems as though, now he is out of office, that interest has faded. In reality, his populism is still with us, and should be understood properly.

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