What does Donald Trump have in common with Aung San Suu Kyi? Absolutely nothing, obviously, except maybe this: Yesterday, both illustrated a broad trend in where power comes from, and it may actually be cause for optimism.
There’s reason to think that power may be democratizing. That thought is definitely heretical in the U.S., where the zeitgeist is all about power concentrating in the hands of ever fewer plutocrats. But look at what just happened in Iowa, and not only with Trump. In the Democratic caucuses, Hillary Clinton and Bernie Sanders finished dead even; Clinton’s 0.3% “win” is meaningless since it’s based only on the estimated number of state convention delegates each candidate would have. The two candidates achieved the same success, yet in campaign funding they’re almost precise opposites. Clinton raised more money last year than any other candidate in either party, about $108 million, and most of it, 59%, came from the largest contributions as categorized by the Federal Election Commission, $2,000 and more. Sanders, by contrast, raised about $74 million, of which the great majority, 85%, came from the smallest contributions, $200 and less. In addition, Sanders has so far received donations from 3.25 million donors, a new record for any candidate in any election as this point in the cycle. Fueled by radically democratized power, he did just as well as Clinton in Iowa and will likely beat her next week in New Hampshire.
The winner among Republicans, Ted Cruz, raised $46.9 million, and most of it, 60%, came from the smallest contributions. (Unlike Sanders, Cruz doesn’t disdain wealthy donors; his second-biggest source of funds, 28%, was the largest contributions.) He was up against the only billionaire in the race, Trump, who hasn’t raised or spent much money so far because his free publicity swamped everyone else’s efforts. The fact remains that he could have spent more than all the other candidates combined, and he still might. Yet the billionaire lost, beaten by a candidate who entered the race with virtually no funds of his own.
Ben Carson further illustrates the theme. He raised more money than any other Republican last year, $53.7 million, and 75% of it came from the smallest donors. Carson faltered after the Paris terrorist attacks turned attention to foreign policy, and it turned out he barely knew the names of the players, but for much of last autumn he was Trump’s top challenger – powered by ordinary citizens, not personal wealth or celebrity or big-money donors.
As for Jeb Bush, the ultimate establishment candidate: Despite a Super PAC that raised well over $100 million and spent well over $61 million, funded in part by giant donations like $10 million from AIG chief Hank Greenberg, he finished a dismal sixth in Iowa, behind Rand Paul.
How does any of this relate to Suu Kyi? Also yesterday, on the other side of the world, she and her National League for Democracy took control of Myanmar’s parliament. The country’s military dictators, reacting to a failing economy and to pressure cultivated for decades by Suu Kyi, last year agreed to the first free elections in 25 years. Democratized power beat concentrated power – even under unfair rules that gave the military a guaranteed 25% of the parliamentary seats.
Many forces are behind this trend; information technology may be the most important. It enables all those small campaign donations in the U.S. by making them enormously easier. It brings worldwide attention to Myanmar and within the country spreads news to the remotest areas and enables people to coordinate plans and encourage one another.
Trends this large never follow a smooth trajectory. But if you’re worried about concentration of power, yesterday was a good day.
You can share Power Sheet with friends and followers here.
What We're Reading Today
Alphabet now the world’s most valuable company
Google’s parent company surpassed Apple in after-hours trading following the release of solid quarterly earnings. Shares started rising in July, partly as a result of CEO Larry Page‘s hiring of CFO Ruth Porat, whose focus on costs and transparency has connected with investors. Tim Cook‘s Apple has suffered from slowing iPhone sales.
Yahoo to announce cost-cutting measures
After its earnings release today, CEO Marissa Mayer is expected to announce a 15% cut in Yahoo’s workforce and will outline plans to shutter underperforming business units. Mayer has also reportedly cut off negotiations for selling Yahoo’s Internet business. Activist investor Jeff Smith of Starboard Value Fund has pressured Mayer to sell the business, but she has signaled her desire to spin it off instead, which could take much longer.
WHO declares the Zika virus a health emergency
World Health Organization Director-General Dr. Margaret Chan made the announcement yesterday as the virus spreads through much of Central and South America. The mosquito-carried virus is the suspected cause of rapidly increasing cases of microcephaly in newborns.
Uber drivers in NYC go on strike
They’re protesting a 15% cut in Uber fares. Abdoul Diallo, one of the organizers of the protest and head of the Uber Driver Network, called on drivers to unionize. While the strike of fewer than 1% of Uber’s NYC drivers won’t likely lead to a larger work stoppage, it’s an odd situation for CEO Travis Kalanick, since the protesting drivers aren’t employees of the company.
Building a Better Leader
Yahoo sued over employee ranking system
The lawsuit claims the strategy of ranking employees favored by CEO Marissa Mayer forced a percentage of the company to be labeled “low performers,” leading to manipulation and even a bribery attempt.
More companies are switching to digital manuals
The training guides for places like Starbucks and McDonald’s are easier to update and distribute.
JPMorgan opens more casual office
The game room and absence of a dress code is meant to attract millennial talent away from Silicon Valley.
Clinton in virtual tie with Sanders
Hillary Clinton defeated Bernie Sanders by less than half a percentage point, but it wasn’t the strong win that Clinton’s camp had hoped for. Instead, it enables Sanders to continue to rally his liberal base around his cause. Clinton’s team was disappointed by the result, which has forced her to add staff and could lead to a shakeup. It also signals that Clinton may be in for a long race with Sanders.
Cruz supplants Trump
Ted Cruz won with 28% of the vote by encouraging evangelical Christian voters back to the polls, while Donald Trump finished second with 24%. Trump lost despite high voter turnout, which his campaign had thought would benefit him. Marco Rubio finished a strong third at 23%, which could propel his campaign as it moves on to New Hampshire.
Races come into focus
Democrat Martin O’Malley suspended his campaign after gaining only 1% of delegates. The Republican has for practical purposes winnowed itself down to a three-way race among Cruz, Trump and Rubio. Jeb Bush received only 2.8% of the vote despite pouring cash and time into the state. In both parties, the theme of establishment candidates vs. newcomers continues.
Up or Out
Docusign founder Tom Gonser is stepping down as chief strategy officer.
Allscripts Healthcare Solutions hired Melinda Whittington as CFO.
Fortune Reads and Videos
BP reports its worst annual loss in 20 years
It will cut 7,000 jobs by 2017 because of low oil prices and high costs from the 2010 Gulf of Mexico oil spill.
Taco Bell wants customers to preorder a new item for the Super Bowl…
…but it won’t tell anyone what they would be ordering.
American Apparel founder plans his next store
And it sounds a lot like the one he just lost.
A robot lettuce farm will open in Japan
The farm will use robots for almost every task to grow the crops.