CEO Daily: The future of Trump’s populism

Oct 22, 2016

Saturday Morning Post: The Weekly View from Washington

We argue in the current issue that while forces hostile to globalization appear to be on the march at home and abroad, free trade boosters shouldn't panic yet. Despite the surprising strength this year of populist, anti-trade bids by Donald Trump and Bernie Sanders, there’s reason to believe the country is in no mood to withdraw from the world. The election itself has distorted the debate by focusing disproportionately on the swing states of the deindustrialized Midwest, rather than trade-friendly states like, say, California, Texas, or Louisiana. Liberal groups whiffed after promising to exact revenge on Democratic lawmakers who supported President Obama’s push for the Trans-Pacific Partnership. And polls show that a solid majority of American voters back more trade in general and the TPP in particular.

For another view, see “The Populist Explosion,” the new book by John B. Judis. Writing from left — with qualified admiration for the impulse — he contends that the populist insurgencies historically have served as warning signs of brewing political crises. The term traces its origins to late 19th century America, and Judis argues that early incarnation of the movement prefigured the New Deal, which adopted many of its earliest demands, including a graduated income tax and price supports for farmers. Three decades later, it was George Wallace, the son of a Roosevelt Democrat, who would channel the backlash against Lyndon Johnson’s civil rights agenda into a rightwing populism (though he began and ended his public career as a Democrat). Wallace’s followers migrated to the Republican Party, accelerating the partisan realignment of the South that later enabled an era of GOP dominance. That era was defined by a new consensus that modified New Deal liberalism with supply-side economics and a more hands-off approach to industry.

Judis casts Trump as the heir to Wallace’s rightwing populism, backed by the same white working and middle-class voters suspicious of empowered elites. He argues that as a deeply flawed candidate, Trump could not only lose but in the process hobble the challenges to Republican orthodoxies that helped power his bid. Yet he makes the case that populism persists because it identifies real problems the two major parties are ignoring. “George Wallace’s call for segregation forever was clearly racist, but he was right about the pitfalls of busing children of different races from one urban neighborhood to another. It did result in white flight to the suburbs and was in that sense self-defeating,” he writes. Similarly, Trump’s protectionist solutions are cartoonish, but “there has been a problem with American trade with China and with unfettered capital mobility.” And if more polished candidates follow in Trump’s footsteps, the party will face a ongoing clash between its white working class and business wings. A reckoning may be a long time coming, but as Judis writes, channeling the economist Herbert Stein, “things that can’t go on forever, don’t.”

Tory Newmyer
@torynewmyer
tory_newmyer@fortune.com

Top News

•  Biden is hustling to save Democrats among working-class whites
A year after swearing off his own presidential ambitions for the last time, Vice President Joe Biden is engaged in a frenzied effort to help Democrats up and down the ballot reach the white working-class voters critical to their success on Election Day. His blitz is about more than just this election, however. The Democrat who’s made his own middle-class upbringing in Scranton, Pa. part of his personal lore wants to ensure the party doesn’t lose touch with a constituency that was once its core but appears to be drifting away. Hillary Clinton is doing even worse among non-college white voters than President Obama did in 2012, registering support from just 29 percent of them in one recent poll.  Washington Post
•  Clinton has commanding leads in the states she needs to win
Here’s where things stand in the presidential contest with less than three weeks until Election Day: Clinton has a commanding lead in more than enough states to secure an Electoral College victory and smaller leads in states that she doesn’t have to win but Trump does. Particularly alarming for Trump, a spate of recent polls from states that should be reliably in his column — Alaska, Indiana, Missouri, South Carolina, and Texas — show he’s barely ahead. Two of those states feature competitive Senate races, and Clinton’s ability to close the margin could help boost Democrats to victory in those contests even if Clinton herself falls short there. And in another signal of just how unusual this year’s election map is shaping up to be, Utah, one of the most Republican states in the country, is now a tossup.  Sabato's Crystal Ball
•  Christie was a bully, his former aide testifies
A former aide to New Jersey Gov. Chris Christie offered up tearful testimony Friday about what she described as rough treatment by the one-time presidential aspirant. Bridgett Kelly took the stand to defend her role in the scandal over lane closures on the George Washington Bridge in 2013 that prosecutors say were politically motivated. Kelly portrayed Christie as a bully who once threw a water bottle at her — and testified that he knew in realtime about the lane closures, which Christie has consistently denied. The scandal has helped savage Christie’s home-state approval rating, which hit an all-time low of 21 percent in a Fairleigh Dickinson University poll released this week. NY Daily News
 In reality, Trump would have few good tools to contest the election results
Trump earned bipartisan scorn with his declaration during the third and final presidential debate that he wouldn’t commit to accepting the election outcome. But if he were to actually challenge those results, he’d find himself in a thicket of state-by-state rules that would require an elaborate and hugely expensive investment to navigate. For starters, in most states, if the election result falls outside a very narrow margin, a campaign requesting a recount must cover its cost. Contesting the results through a special judicial proceeding, known as an election contest, would require the campaign to gather its evidence before the election is certified. Trump would have other options, like asking electors to ignore the will of their states’ voters, but none are very realistic. New York Times

Around the Water Cooler

•  Why didn’t big business stop Trump’s rise?
Two academics offer a theory: The disintegration of a tightly-knit corporate elite over the last decade-plus vastly diminished the power of big business to speak with a unified voice about its political and policy preferences. They point to the corporate scandals of the early 2000s and the subsequent reforms in the Sarbanes-Oxley Act of 2002 as dismantling a network of executives who once sat on multiple boards and thereby shared ideas and developed consensus. The effect was an agenda that hewed to the ideological middle. That system has been replaced by one in which billionaire donors plow millions upon millions of their own wealth into the process to further their individual priorities. The argument doesn’t quite explain how things would have unfolded differently in the Republican primary if the old system had persevered.  The Conversation
•  Trump, typically defiant, now sounding glum on the stump
Facing a polling collapse that spells near-certain defeat, Trump is publicly confronting the possibility of a loss, and he isn’t happy about it. After a particularly rough week, the GOP standard-bearer took the stage for a rally in North Carolina on Friday afternoon and ruefully mused about “what a waste of time” his run will have been if he comes up short. That mood appears to have settled over his campaign.  Nevertheless, Trump is due to deliver a speech in Gettysburg, Pa., today billed as a preview of what he'd seek to accomplish in his first 100 days in office, including  a major regulatory rollback. Washington Post
•  Russell Simmons says he’s heard Trump, a longtime friend, make insensitive remarks
Hip-hop mogul Russell Simmons, a longtime Trump friend but a Clinton supporter, says over the three decades he’s known Trump, he’s heard the Republican nominee make statements he found “a little racist,” anti-Semitic and Islamophobic. Simmons has been clear what he thinks of Trump’s candidacy since he released an open letter to him a year ago arguing he’s unfit for the presidency. Simmons didn’t elaborate on what, specifically, Trump said and called him a “very likable person,” adding, “I just don’t think he’s a very suitable person for the presidency.” Fortune

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