If the 2017 elections are any indication of what’s to come in the 2018 midterms, Republicans are in trouble, and not because of a clean sweep by Democrats in Virginia on Tuesday. It was how Republicans lost on Tuesday, and how badly, that should have them concerned.

Democrats Sweep the Big Three in Virginia

The Virginia governor’s race that got all the media attention wasn’t close. Polls had Democrat Ralph Norman leading slightly, but his lead over Republican Ed Gillespie had shrunk from as many as nine points to three or fewer points in a matter of days. Warnings of past polls leaning Left in Virginia gave Republicans hope, but it was false hope, as Norman won by 8.6 percentage points.

The most important election for Democrats on Tuesday was that of Virginia’s attorney general. State attorneys general have been the best (and in many instances the last) line of defense for Democrats against the actions of Donald Trump’s administration, especially the travel ban. Incumbent Democrat Mark Herring beat Republican challenger John Adams by 6.5 percentage points.

Democrat Justin Fairfax completed the clean sweep of Virginia with a win over Republican Jill Vogel to become lieutenant governor. He won by 5.4 percentage points. The real gains for Democrats were made in Virginia’s district elections, though.

Republican Majority in Virginia House Vanishes

The biggest blow for Republicans came in Virginia’s House of Delegates, where they’ve lost 14 seats as of this writing, with two more close races predicted for Democrats and another three tossups predicted to go to Republicans. If Democrats win just one of those Republican-leaning tossups -- perhaps the 94th District, where Republican David Yancey and Democrat Shelly Simonds each have 49 percent of the vote -- the Democratic Party would hold a majority in the Virginia House for the first time since 2000. The wins are especially sweet for Democrats because Republicans experienced their largest majority just last year, holding 67 of the 100 seats.

The success Democrats had in Virginia’s districts is unprecedented. Democrats have never taken back as many Virginia House seats as they did Tuesday. It’s been 40 years since Democrats picked up 13 House seats in the Commonwealth, and they were already starting with a 65-seat majority back then.

The history of Virginia’s House of Delegates is one of epic streaks. Democrats held the majority for a century, and when it flipped to the Republicans, it looked as though it would take another century for Democrats to take back control. It took 100 years for the Virginia House to go from a Democratic majority to a Republican majority and, perhaps, just one night to swing the Virginia House back to the Democrats.

How and Why did Virginia Go Blue?

To say the current administration and do-nothing Congress didn’t have something to do with the Republicans’ losses in Virginia would be naive. Trump’s record-low approval rating is representative of the general sentiment of Americans, and with Republicans in the White House, they’re already starting from behind. The party occupying the White House tends to lose more midterm elections than it wins, and those losses are loosely predicated on the President’s approval rating. The effects on voter turnout are already apparent.

Democrats showed up to vote in 2017. Voter turnout was up 16 percent in Virginia compared to the last election for governor in 2013, but that’s nothing when you compare Tuesday’s voter turnout to that of the 2015 election.

Less than 30 percent of registered Virginia voters voted in 2015, which came to a grand total of 1,509,864 voters -- a decrease in voter turnout of over 11 percent from the previous year. Almost 1.1 million more Virginians voted in 2017 than in 2015. That’s a 72 percent increase, so to say Democrats were motivated is an understatement.

What Does the Future Hold?

Democrats also won the elections they should have in New Jersey and New York, and Maine even expanded Medicaid. But the races that reveal the most about the views of the average American and what the future holds for American elections are those for city council. The ever-changing political leanings of communities debut in city council elections long before they’re seen on the national scale. And no city council election revealed more about the future of American politics than that of Minneapolis’s Ward 3.

Ginger Jentzen, running as a Socialist, received more than a third of first-place votes in a four-candidate race. Since she won the popular vote, Jentzen gets to cannibalize the second- and third- choice votes that went to her from voters whose first choice has no chance of winning. For instance, Samantha Pree-Winston received just 10.5 percent of first-place votes and has no shot at winning the election, so those voters who chose her as their first-choice help decide the election with their second and third choices. Those second-choice votes are allocated to the candidates voters chose as first-choice votes. If there’s still not a candidate with a majority of the vote, the candidate in last place is eliminated, and their second-choice votes are allocated to the candidates they chose as first-place votes.

This is where ranked-choice voting proves its worth at Jentzen’s expense. Jentzen might have won the election using a traditional ballot where voters can choose just one candidate, and the candidate with the most votes wins. But her lack of second- and third-choice votes makes her winning of the popular vote irrelevant, unless she had secured a majority (50 percent plus one vote) in first-choice votes.

Unfortunately for Jentzen, it looks as though she wasn’t many voters’ second or third choice. Jentzen received just 13.7 percent and 18.3 percent of second- and third-choice votes, which makes it difficult for her to pick up the majority needed to win the election. Jentzen’s supporters likely chose just one candidate -- Jentzen -- forgoing their second and third choices, resulting in a lot of first-choice votes and not much else. It’s a sound strategy nonetheless. Jentzen just needed another 1.500 first-place votes or so.

Regardless, the strong showing by Jentzen proves a political point: socialism isn’t a dirty word -- in Minneapolis at least. That might not be saying much given Minnesota’s history of strong unions, but Jentzen’s successful campaign will inspire other Socialists to run for office unafraid of the misinformed perception of their party affiliation. At the very least, this little city council election revealed that Left-leaning voters aren’t afraid of moving further Left than the Democratic Party has been willing to go, which bodes well for Bernie Sanders in 2020.

The Democrats left nothing up for debate on Tuesday. Had they lost any one of the Virginia elections or gained half as many Virginia House seats, Republicans might have been relieved or found reason for hope. Instead, they can see the train coming and can’t get off the tracks.

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If you like this, you might like these Genesis Communications Network talk shows: The Costa Report, Drop Your Energy Bill, Free Talk Live, Flow of Wisdom, America’s First News, America Tonight, Bill Martinez Live, Korelin Economics Report, The KrisAnne Hall Show, Radio Night Live, The Real Side, World Crisis Radio, Know Your Rights

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Now that Republicans’ plans to repeal and replace Obamacare are all but dead, GOP Congress-men and -women will be working to preserve their jobs by accomplishing something -- anything. Now it seems the Republican budget proposals will get in the way of their next big project -- tax reform. But there is a lifeboat out there for Republicans, if they’re willing to accept a hand from a Democrat.

Progressive Consumption Tax

Senator Ben Cardin (D-Md.) reintroduced S. 3529, otherwise known as the Progressive Consumption Tax Act (PCTA), back in December. And while the bill wouldn’t do what many Republicans would like and get rid of the Internal Revenue Service, it would re-purpose and shrink the IRS and make tax collection a lot easier. It would also make it so most people would no longer owe individual income taxes, and it would reduce the corporate income tax rate to one of the lowest among industrialized nations.

“How?” you ask. Well, revenue once created by income taxes would be replaced by revenue created through a consumption tax, which is a tax on goods and services consumed rather than a tax on income. It’s a lot like a sales tax, except Cardin has proposed what’s called a value added tax.

Value Added Tax (VAP)

A value added tax is collected from each producer involved in the production chain of a product rather than the end consumer. So if a manufacturer buys $40-worth of product from other manufacturers earlier in the production chain, puts its own labor and materials into it and sells it for $100, the value added by that manufacturer is $60.

Why a value added tax? It’s more likely to be paid. Compliance is believed to be better when the tax is collected at all stages of production rather than the final stage, when the product is purchased by a consumer from a retailer. Both a retail tax and value added tax would produce identical revenue if compliance is perfect, and collecting at all stages of production would help ensure that is the case.

Flat Tax

Cardin’s proposed a 10-percent, flat tax because it simplifies taxation, facilitates compliance and enforcement, and doesn’t allow for distortions based on product type. The few exemptions to the consumption tax are financial services, “which are difficult to handle within a VAT and are often exempted, residential rents, and sales of existing residential housing.” So you won’t pay taxes for your accountant or broker, rent or mortgage, or the sale of your home.

According to the independent and nonprofit Tax Foundation’s Taxes and Growth Model (TAG), the plan would raise the country’s gross domestic product (GDP) 4.4 percent, increase the stock of capital used in production by 15.2 percent, and create 1.1 million jobs. It would also increase after-tax income for rich and poor, so every American would have more money with which to stimulate the economy. In fact, real after-tax hourly wages would increase 6.5 percent.

That all sounds great, right? But will it pay the bills? In short, yes. Cardin’s plan is designed to raise at least as much revenue as the current income tax system does, and the rate can be altered, but the revenue created can never be more than 10 percent of GDP. That doesn’t mean the percentage can’t increase, but the U.S. tax revenue as a percent of GDP was 26.4 percent in 2015. Cardin’s plan would refund taxpayers any revenue over 10 percent of GDP.  

Do you see how Cardin’s plan creates more revenue despite a lower percentage of GDP? Tax revenue, whether a consumption tax or income tax, is linked to economic growth. The more economic growth, the more tax revenue. Increasing the U.S. GDP 4.4 percent is no small feat. As of 2015 numbers that’s almost $800 billion, which would cover the entirety of the Republicans’ proposed military budget and then some ($621.5 billion).

Why should Congress enact a consumption tax? Well, much like healthcare, the United States is behind a lot of developed countries when it comes to taxation. About 150 countries have a consumption tax, most of which were established decades ago.

The consumption tax would also allow the U.S. to tax imports and subsidize exports without violating current World Trade Organization rules (WTO), which Donald Trump would love, even though economic theory indicates a border adjustment tax would end up trade neutral. But that’s what House Republicans want, even though, “Economists can show that the House Republican plan has the same effect as abolishing the corporate tax altogether, introducing a VAT, and then cutting payroll taxes.”

That makes the Republicans’ border adjustment tax nothing more than a political ploy that plays to its base, but that’s what Republicans need -- a political ploy that plays to its base. That and an accomplishment like tax reform. It ain’t gonna be healthcare or a budget anytime soon. So work together, Congress, and we can all get what we want.

Enacting a consumption tax is about as bipartisan as it gets. Republicans get to help corporations. Democrats get to help the poor, and Republican Congress-men and -women might get to keep their jobs. But apparently it’s a nonstarter for most Republicans -- unless you tell them otherwise. You can use Countable to keep your Congress-men and -women accountable to you. I urge you to contact them and tell them you want a progressive consumption tax. It will save every American money, and allows Americans to save and invest.

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If you like this, you might like these Genesis Communications Network talk shows: The Costa Report, Drop Your Energy Bill, Free Talk Live, Flow of Wisdom, America’s First News, America Tonight, Bill Martinez Live, Korelin Economics Report, The KrisAnne Hall Show, Radio Night Live, The Real Side, World Crisis Radio, The Tech Night Owl, The Dr. Katherine Albrecht Show, Free Talk Live

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You might be wondering how Republicans could be better off than owning a majority in both houses of Congress and occupying the White House. Well, they could do it longer. If Georgia’s 6th Congressional district, and even more surprisingly, South Carolina's fifth, are any indication, the Republicans are in for rude awakening in 2018 and 2020.

 

While Republican Karen Handel won the election, Democrat Jon Ossoff made us all pay attention to a district that’s been nothing but red since Apocalypse Now and Alien were in theaters.

 

While it’s highly unlikely the Democrats win three of the eight Republican Senate seats up for reelection in 2018 to win a majority, the House is a different story. It doesn’t matter whether Congress repeals and replaces Obamacare. House Republicans are under fire whether they do or don’t. Midterm elections have been historically bad for the party occupying the White House, as was epically the case for Barack Obama in 2014. The average loss of House seats by the party with a newly elected President is 23. There are already 23 House seats held by Republicans in districts Hillary Clinton won, while just 12 that have Democratic representatives and voted Trump.

 

FiveThirtyEight’s Harry Enten compared a President’s approval rating to the results in the midterm elections, and despite a large margin for error, (+/- 33 Congressional seats) there was a correlation. And Trump’s residency of the White House has only just begun. After 149 days, Trump’s approval rating, as measured by Gallup, has dropped to 38 percent, and Trump started with the lowest approval rating for any first-term President ever rated (45 percent). Trump has that record by six points. Barack Obama and George W. Bush had approval ratings of 61 and 55 percent, respectively, over roughly the same number of days. At the time of their first midterms, they were at 45 percent and 63 percent, respectively.

 

Bush’s 63 percent approval rating is the reason why he’s one of the exceptions to the rule that the party residing in the White House loses Congressional seats in the midterms. It’s the highest approval rating ever during a midterm election. An unpopular war brought Bush and Republican Congressional candidates back down to Earth the second time around.

 

The only President who’s experienced a similar decline to Trump over a similar period is Gerald Ford. Over 157 days in office, Ford saw his approval rating fall from a very respectable 71 percent to 37 percent, He pardoned Nixon and still only had nearly the same approval rating as Trump does now! So what I’m saying is there’s plenty of time for Trump to hit rock bottom.

 

Going back to that FiveThirtyEight analysis, if Trump’s approval rating were to fall to say 31 percent, “Democrats would be projected to gain 53 seats” (again, +/- 33 margin of error). I’m not betting on Trump’s approval rating to be that high. He’s already got the record for the lowest approval rating to start a Presidency by six points. I’m betting he has the lowest approval rating of a first-term President going into a midterm election by the same margin.

 

That record also belongs to George W. Bush. He entered the 2008 midterms with an approval rating of 31 percent. The Republicans lost 36 Congressional seats in that election. Now consider if Trump were six points worse than that. He’d be hovering around 25 percent, and House Democrats would stand to gain considerably.

 

The job Trump is doing (or not doing considering all the rounds of golf he’s getting in) is already rubbing off on incumbent Congressional candidates, and the stink is legendary. Georgia’s 6th Congressional district has been a Republican stalwart since 1979. The fact that race was even close shouldn’t be taken lightly. We’ve never had a President this disapproved of at the start of a Presidency, and we’ve never seen a White House like this, so I expect the worst.

 

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If you like this, you might like these Genesis Communications Network talk shows: The Costa Report, Drop Your Energy Bill, Free Talk Live, Flow of Wisdom, America’s First News, America Tonight, Bill Martinez Live, Korelin Economics Report, The KrisAnne Hall Show, Radio Night Live, The Real Side, World Crisis Radio, Know Your Rights

 

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