Saturday, December 26, 2015

GOP PRIMARY: RALLY ‘ROUND THE MILQUETOAST?

12/26/15

Concerned Republicans of a more mainstream bent are apoplectic at the idea of Donald Trump’s getting their Party’s nomination and thus forcing the Party to do a 52 years later redux of 1964.  The professional Republicans are urging marginal candidates to withdraw so that the mainstreamers can unite behind one candidate to topple Trump.   Before people continue their backroom plotting to “save the Party,” they ought to get a clearer understanding of the numbers involved, a tighter handle on what keeps campaigns alive, a more acute sense of the mind of a politician, and, most of all, a calendar.   This being the time of the year that it is, hopes are strong that at least the last will have been achieved.   The first three, though, remain problematical.

Those thinking that a moderate champion could emerge from the disparate GOP field surely can see that if one adds the poll numbers of Donald Trump, Ben Carson, and Ted Cruz, i.e., the “unconventional” candidates, one can surely see that they add to more than 50% of the polled electorate.   So a “mainstream” alternative would still not marshal the numbers needed to defenestrate Mr. Trump if those pining for somebody different do the logical thing and support Mr. Trump in a head-to-head contest with the usual milquetoast type of candidate the GOP leadership mistakenly seems to think should inflame the positive passions of the electorate.   Maybe those who support the self-winnowing of the field think Mr. Carson will stay in the race and split what those middling types consider the whacko vote.  Or maybe those singing odes to the banality that is professional Republicanism are getting to the point at which they are willing to consider Mr. Cruz one of them, at least on a relative basis.  

Even if the moderates think the numbers will change and their moderation will prevail, they ought to consider what motivates a politician to drop out of a presidential race:   money.    One can bet that those who have already left the race…Rick Perry, Scott Walker, Lindsey Graham, and perhaps some other notable that I have missed…left because their money dried up.   And one can also bet, perhaps only a bit less surely, that the “smart” money’s having rallied early behind the increasingly pathetic Jeb Bush is what kept Mitt Romney from throwing his hat back into the now familiar ring.   As long as the money is available, these guys are going to stay on the campaign trail.   Why go back to a real job when one can make a living addressing adoring crowds in events staged in figurative, and perhaps literal, echo chambers?   Why struggle away actually doing something that might benefit society, and one’s own net worth, when one can spend one’s days basking in the sycophancy of those who want to stay on the payroll and the “crowds” they fabricate?    Yes, the campaign trail is grueling, but it sure beats working for a living.   As long as the money is available to bask in unceasing adulation, with an occasional somewhat dull barb tossed in to keep one’s name in the paper, why do anything else?

Surely, the concerned GOPers tell themselves, the walking dead among the GOP candidates will leave the field for “the good of the party.”   Right.  These people, whose most salient characteristic is an outsized ego, will take one for the team.  Uh-huh.   And Jesse Ventura is going to come out of retirement and join with yours truly to take the WWE tag team title.  No.  As long as the money is there, these professional narcissists are going to make their livings basking in the faux adulation of the hastily assembled.

Most of all, though, those who are wringing their hands in certainty that a Trump nomination is inevitable ought to consult the calendar.   It is still 2015 for at least a few days.   We are still six weeks away from the first real contest of the campaign, the Iowa caucuses, which Mr. Trump will probably lose.  (See TRUMP, THE “REVERSE BRADLEY EFFECT,” AND THE MAN’S UPCOMING LOSS IN IOWA, 12/23/15).   If history is any guide, that a particular candidate is leading at this stage of the race means nothing; ask Presidents Rockefeller, Connelly, Muskie, Perry, and Hillary Clinton.   It’s way too early to be making predictions, for anything transcending entertainment value, about the ultimate outcome of the nomination fight.   The only exception, as my regular readers already know, is the now months old prediction of yours truly that you should take to the bank:   Carly Fiorina is going to be on the GOP ticket.  See THEONE INESCAPABLE CONCLUSION FROM THE SEPTEMBER GOP DEBATE, 9/18/15.  I have already bet a beef sandwich on this proposition and, for yours truly, those are pretty high stakes.

Those GOPers lamenting the fate of their Party with Mr. Trump as its standard-bearer might also calm down for other reasons, but that is grist for a later mill.

WHY TRUMP IS SO POPULAR WITH THE MIDDLE CLASS

12/26/15

12/26/15

I sent the following letter to the Chicago Tribune on 12/20 and the paper published it this (Saturday, 12/26) morning in the “Voice of the People” section more or less intact.   I appreciate that because it’s been awhile since the Trib has published anything I’ve sent, though I have to admit I haven’t sent much for a while.  I have reproduced the letter below for my readers’ convenience.

I sent a very similar letter to the Wall Street Journal a few days earlier.    The Journal has yet to run the letter but, if it does, I’ll also post it on this blog after publication.

Thanks; I hope you had a great Christmas and that the arrival of our Savior will continue in your hearts.



12/20/15

Donald Trump has been characterized as demagogue on the Perspective pages of the Tribune and as a bigot, or worse, in other organs of the media.  The sachems of the press and of the political world clearly see Mr. Trump in this light and are scratching their heads at the very notion of Mr. Trump’s popularity.  Why do so many middle class voters support Mr. Trump?   Are Trump supporters, as much of the press is doubtlessly concluding, a pack of benighted morons who don’t know what’s good for them? 

As usual, the media and political sages have it wrong.  People support Mr. Trump because they are fed up.  They are sick and tired of terrorism, street violence, and a society seemingly coming apart at the seams.  They are appalled by a feckless foreign policy that has gotten us nowhere but deeper in debt and further into the cauldron of Middle Eastern intrigue at the cost of trillions of dollars and thousands of the lives of their sons and daughters.  They have had it with paying ever higher taxes so that the government can seemingly remain at the beck and call of every stratum of society but theirs.   Most of all, they are fed up with the fealty to political correctness and the blind allegiance to Republican and Democratic doctrine that creates and exacerbates the problems that are permeating our once great nation.  Finally, middle class voters know that any “solution” that comes from the Democratic or Republican establishments will involve spending lots of their money to sink us more deeply into the morass that the career politician mindset has largely created.

People aren’t, as media mavens and political pros suppose, stupid; they realize that Donald Trump is far from the perfect vessel for addressing the problems that politics as usual have created for them.   But they know that a vote for the same old Washington nabobs is pointless…or worse.


Mark M. Quinn
Naperville



Thursday, December 24, 2015

CHRISTMAS WISH FOR 2015: THANKS GOD IT’S STILL CHRISTMAS

12/24/15
Christmas is upon us, the celebration of the birth of our Savior.  It is a period of rejoicing and a period of joy filled prayer, prayer both of thanks and of asking that we be ready to receive Him into our hearts and souls.   Not only do we celebrate Jesus’s arrival in Bethlehem two millennia ago, but we also celebrate His desire to implant Himself in our heart and souls every day and pray that we are be receptive to that desire.

As I have pointed out every year in my “Christmas posts,” this holiday has been overly commercialized and its true meaning has largely been lost.   This, of course, is nothing new; the commercialization of Christmas has been lamented for decades, even centuries.   The seeming desire of secular society to obliterate the holiday is a more recent, but very real, lament.   Yours truly, perhaps surprisingly, has never been keen on the “Keep Christ in Christmas” effort; indeed, I have long been in favor of keeping Christ out of “Christmas,” given the way our society chooses to celebrate the holiday.   See for example…

KEEP CHRIST OUT OF “CHRISTMAS”—2014 EDITION

for a sort of (sort of?) downer take on the holiday.  Thank God my mood at this time of year has vastly improved in 2015.

More lighthearted, but still not caught up in the spirit as dictated by Madison Avenue, et. al. takes on the season include

KEEP CHRIST OUT OF “CHRISTMAS,” 2009 EDITION

and

LOOK SLOVENLY, FEEL SLOVENLY, BE SLOVENLY

The last of the above, also from 2009, is one of my all time favorite Christmas related posts.

This year, however, I will not launch into a rant, or even a tirade, on what our materialistic, self-absorbed, and seemingly bent on self-destructive society has done to Christ’s birthday.   Instead, I’ll do my part to welcome Him into my heart, realize that there are many things I can’t control, and wish all of you a blessed Christmas.   Perhaps as a result of my slight change of attitude, it has so far been an especially enjoyable Christmas season at home, watching (admittedly, for the most part, secular) Christmas movies, enjoying the family, and generally thanking God that His Son’s birthday is still in the hearts and minds of many.

As I head off to Christmas Eve Mass, I wish all of you a blessed Christmas.   You are all in my prayers now and always.


Wednesday, December 23, 2015

TRUMP, THE “REVERSE BRADLEY EFFECT,” AND THE MAN’S UPCOMING LOSS IN IOWA

12/23/15

As I have been telling people with whom I engage in political discussions for (at least) weeks, Donald Trump will lose in Iowa.   While Iowa is not an inordinately conservative state, its GOP electorate is dominated by socially conservative evangelical Christians.   For obvious reasons (e.g., the serial marriages, the only vague familiarity with religion of any kind, the references to “eating the wafer,” and the lack of concern for most of the issues these voters hold dear), these people are not big Trump fans.   For the last several months, their support has been split between Ted Cruz and Ben Carson, with a few votes going to the walking dead Rick Santorum and Mike Huckabee.   With Dr. Carson’s candidacy weakening, that evangelical support in Iowa has been going to Mr. Cruz and, if Dr. Carson’s support continues to swoon, more of his supporters will go to Mr. Cruz.   So it looks like Mr. Cruz will triumph in Iowa.

The only qualification I would provide for the above prediction involves what I call Mr. Trump’s “reverse Bradley effect.”   Many of you remember Tom Bradley, the mayor of Los Angeles who happened to be black.   Mr. Bradley wanted to be governor of California and won the Democratic nomination for that post in 1982.   The polls going into election day showed Mr. Bradley winning the general election against George Deukmejian.   After the polls closed, news organizations, working from their polls, projected Mr. Bradley to be the winner.  But Mr. Bradley wound up losing the general to Mr. Deukmejian.   It was later determined that Mr. Bradley, or at least the polls that showed him winning, suffered from the tendency of a substantial number of white voters who had no intention of voting for the black candidate to tell pollsters that they intended to vote for that candidate so that they didn’t appear to be racist.   That tendency of white voters to appear to do the politically correct thing and thus “misreport” their intentions to the pollsters will thus forever be called the “Bradley effect.”

Yours truly, by the way, considers honesty in all things to be perhaps the paramount virtue.   One should never lie; I never do.   This may be due to virtue or may be due to laziness and/or a faulty memory.   You see, when one is honest, one has to remember far fewer things.   Despite this fealty to honesty, however, I encourage my readers to ALWAYS lie to pollsters because of the deep seated antipathy I have toward polls and the havoc they have wreaked on the drama of election night.   If I am ever polled, I don’t know how I will handle the moral dilemma that will confront me.  But I digress.

Back to the point...There is little doubt in my mind that Mr. Trump suffers from a “reverse Bradley effect;” i.e., lots of people who support Mr. Trump will not admit to a pollster, or to anyone who could constitute a member of polite company, that they will vote for the man.   The reason for people’s hesitancy to report their support for Mr. Trump is obvious:  the media have made the guy out to be a demagogue, a bigot, a lowlife, a dictator, a racist, a misogynist, and any number of ghastly characterizations.  A vote for Mr. Trump is perhaps the most politically incorrect act a person can commit. The reason for people’s support, even if verbally unexpressed, of Mr. Trump will be covered in a future post or posts.

Mr. Trump’s reverse Bradley effect may carry the day for him in Iowa, but I suspect it will not.   Mr. Cruz will, in all likelihood, “win” the caucuses …to the extent such a thing is possible given the nature of the Iowa caucuses, which few people understand.


The question then becomes what the even temporary loss of the veneer of invincibility will do to Mr. Trump’s campaign.   Will he be finished or will this defeat in the first real contest, like so many other things, roll off his back as he goes on to rout the opposition in New Hampshire, where Mr. Cruz has little support, emerge triumphant in South Carolina, and face a thus weakened Ted Cruz in his southern backyard?   But enough predictions for the day, especially from yours truly who, believe it or not, does not like to make political predictions.

Friday, December 18, 2015

DONALD TRUMP AND THE MOB: THE HORROR!

12/18/15

I sent the below letter to the Wall Street Journal in response to an editorial piece castigating Donald Trump for working with Mob associated concrete contractors in 1980s New York.   They published an abbreviated, and edited, form of this letter this morning, i.e., Friday, 12/18/15.   I’ve posted the note in its brief entirety here for your reading pleasure:

12/12/15

Okay, we get it; you Wall Street Journal editorial writers don’t like Donald Trump.   But while there are certainly legitimate reasons to be opposed to, or at least concerned about, the guy, you choose to attack Mr. Trump for dealing with Mob connected concrete contractors. (“Trump and the Goodfellas,” 12/12-12/13/15) Can you imagine that?   A construction magnate in 1980s New York using Mob related concrete contractors?  Criticizing big time New York real estate developers for dealing with the Mob in the 1980s is like accusing an Olympic swimmer for coming into contact with chlorinated water.


Monday, December 7, 2015

JAB BUYS KEURIG GREEN MOUNTAIN (GMCR): P.T. BARNUM AND H.L. MENCKEN SHARE A CUP OF JOE …AND A SMILE

12/7/15

The big news in the financial world today was the $92.00 cash offer for Keurig Green Mountain (GMCR) by Germany’s JAB Holdings.   That $92 was a (Get this!) 78% premium to GMCR’s close on Friday.   GMCR traded up $37.19, or 72%, to $88.89 today.   All in all, a great day for people long GMCR, a group that did not include your truly.

I have only a few, and probably not all that consequential, thoughts on the deal, but more salient thoughts on GMCR and its signature product, the Keurig single cup coffee maker. 

On the deal…

·         Until today, the shorts were having a field day with GMCR; at Friday’s close of $51.70, GMCR was down 63% from its 52 week closing high of $139.69, reached just about a year ago.  Maybe the Reimann family, which essentially is JAB Holdings, knows something the existing shorts don’t.  Or maybe the Reimanns just think the stock had fallen too far, partially courtesy of the shorts.   We don’t know what their thought process was.
·         That $92 per share price for GMCR is, according to reports, 15 times earnings before interest, taxes, depreciation, and amortization, or EBITDA.  Fifteen times.  Wow.   Back in the ‘80s when I was a kid working on the buy side of junk bond market and knew everything, we would look at deals with big multiples of EBITDA, but even in those gun slinging days, a 15 EBITDA multiple was considered, er, risky.   And I remember fondly the familiar response of my boss, or, more properly, my boss’s boss, a great man named Bill Buecking, when yours truly would present such deals.   He would read the material, listen to my presentation, lean back, shake his head, and say “We’ve come a long way with these deals…a LONG way.”   Fortunately, Bill’s wisdom often overrode my rookie omniscience and saved us from a lot of bowser deals.

So, no, I don’t know a lot about the specifics of the GMCR deal.  But my experience with such deals, my respect for some of the people who remained short GMCR, and the years that have passed since I was a 20 something at Kemper who knew everything, give me pause.   But I’d sure like to have been long GMCR before the open this morning.

More salient is the suspicions I have had about these single serving coffee makers since their inception.   After doing some quick calculations and discovering that making a single serve Keurig cost about as much per cup as making seven cups of coffee in a Mister Coffee, I wondered who in the world buys these things.   

Keurig marketed this latest bow to the “Gotta have it because my neighbors have it” approach to spending that permeates our society by saying that a Keurig cup is a downright bargain compared to a cup of coffee at Starbuck’s (Note to Keurig:   so is just about any other consumable in the world on a per ounce basis.) or even at Dunkin’ Donuts.   Well, yeah, but you actually have to brew your own coffee with a Keurig.   The far more apt comparison is to a brew your own cup out of a Mister Coffee or even a Melitta coffee maker, if you must.  In that comparison, the Keurig cup gets beat more mercilessly than a hapless opponent of the late Dick the Bruiser.  But don’t tell that to a yuppie in a hurry to spend money he doesn’t have to buy something he doesn’t need in order to impress people he doesn’t like.   But I digress.

So I was heartened this morning as I was listening to Bloomberg Radio on the way to Mass and heard an analyst (Sorry; I didn’t catch his name or employer.) say the following about buyers of Keurigs:

“These are people who turn a four cent cup into a 30 cent cup and pay $100 for the privilege.   So I don’t think price sensitivity is an issue here.”

This insightful young (I presume; I am rapidly approaching, if I haven’t passed, the age at which everyone is young.) man, obviously, was responding to a question regarding price sensitivity and Keurig products and was therefore commenting only on those aspects of the Keurig customer.   Yours truly, however, would apply the same logic, as I have in the past, to other characteristics of the typical Keurig customer.   I was immediately reminded of the insight of P.T. Barnum, who reminded us that there is a sucker born every minute.   But the reiteration this morning by the aforementioned highly compensated analyst of my years ago thoughts on the price “logic” behind a Keurig purchase brought to mind one of the most famous, but most misquoted, musings of one of my heroes, H.L. Mencken, to wit:

“No one in this world, so far as I know—and I have researched the records for years, and employed agents to help me—has ever lost money by underestimating the intelligence of the great masses of the plain people. Nor has anyone ever lost public office thereby.”

I would perhaps limit this observation to the apparent upper strata of society rather than to “the great masses of the plain people,” but the underlying idea is self-evident.

Those who do throw their coffee money away so frivolously will doubtless retort

“Oh, but I like coffee from my Keurig and, after all, I can afford it. ”

…as if that answer should somehow give us comfort about the future of both our republic and our economy given that both are in the hands of many of those who employ such “logic.”   I, and I am sure you, know people who can afford to throw $20 bills off the top of the John Hancock Building and would doubtless have a few laughs doing so.   That makes it a good idea?

So I don’t know if JAB’s purchase of GMCR will work out for JAB.   But for it to work, the American people will have to continue to spend money on highly cost ineffective geegaws, which is a great bet.  Further, however, the growing competition for CMGR’s not all that unique line of products will have to somehow stumble and fail to catch the limited attention span of the type of people who pay seven or eight times a product’s value in order to be trendy and “with it,” a more questionable bet.   Finally, JAB will have to find financing for a 15 times EBITDA deal in an environment featuring rising short term interest rates and a weakening junk bond market.   I suspect I know what Bill Buecking would have said 30 years ago and what yours truly, after having acquired a small measure of Mr. Buecking’s wisdom, would say today.   But since I don’t ply the junk waters any more, I’ll just make myself a 4 cent cup of coffee and leave this deal for the smart kids to ponder.


Thursday, December 3, 2015

CHICAGO’S GOLDEN BOY MAYOR FINDS HIMSELF IN DEEP TROUBLE

12/3/15
Chicago Mayor Rahm Emanuel is in big trouble.   The City of Chicago is in financial hot and rising water that was only partially, and temporarily, alleviated with the property tax increase and other “revenue raising measures” the Mayor rammed through the City Council.   The Mayor’s hand-picked schools chief is plea bargaining with the feds over a massive corruption scandal taking place right under the noses of Mr. Emanuel’s school board.  Crime is a big problem in the city and it’s not, as the Mayor seems to suggest, just a problem of optics and perceptions.  And now much of Chicago’s black community, much of its white community, and all of its black political leadership is in an uproar over the shooting of Laquan McDonald and the long delayed release of the tape of Mr. McDonald’s killing.   (See POLITICSAND THE LAQUAN McDONALD SHOOTING:   THETIMELINE DOESN’T FIT THE NARRATIVE, 11/26/15)   Some are seriously calling for the Mayor’s resignation, a resignation for which they will be waiting a long, long time, to be sure.  

The question one has to ask, and that one suspects Mr. Emanuel is asking himself, is why in the world he ever wanted to become mayor of Chicago in the first place.   Mr. Emanuel says that this is the only elected post he wants to hold.   Only the most naïve people believe this; the rest of us know that the job of mayor of our fair city is, like everything else in Mr. Emanuel’s professional life, only a stepping stone to the next thing.   And most of us know what that “next thing” is.   So why did Mr. Emanuel think that being mayor of Chicago would set him up nicely for the Oval Office?   Or, for those ingenuous enough to believe that Mr. Emanuel has no intention of running for president and just wants to be a good mayor, why did Mr. Emanuel think he could actually run the dystopia that my beloved home town is fast becoming?

The answer lies in Mr. Emanuel’s perception of himself.   He is the archetypical young, well educated, upper middle to upper class child of privilege that is absolutely certain that he knows the score, that he has the plan, and that, if the benighted citizens would only come to realize and appreciate his manifest wisdom, he could lead us to nirvana.

You know the type.    They were raised in wealthy suburbs by either doting parents or parents who demanded “excellence,” narrowly but somehow fuzzily defined, of their children.   They were sent to fancy schools whose faculties featured denizens of the ‘60s radical movement who somehow never found their way back to reality.    At these schools, these golden children were treated to continued reassurances that they were indeed wonderful in every way interspersed with the errant nonsense that passes for modern non-technical higher education.   When they emerged from these cocoons of craziness, these wonder children moved from their suburban hometowns, for which they showed nothing but contempt, into “the city,” generally gentrified neighborhoods in which everyone thought, and sometimes looked, just like themselves.   This echo chamber served to constantly reinforce their life-long held conviction that they were obligated to bring enlightenment to those who needed only to understand the goodness and omniscience such a background conferred on these denizens of yuppiedom.    These wunderkinds could do anything…if only the dullards they deigned to govern would appreciate the favor they were being granted by the presence of this newly emerging ruling class.   So is it any wonder that Rahm Emanuel thought that he, and maybe he alone, could pull the city of Chicago back from the precipice of doom toward which it was speeding?

Mr. Emanuel is the archetype of this entitled and oh so competent, clever, smart, and compassionate class of philosopher kings.   Further, he is probably among the most talented and ruthless of this bunch.   Yet he is only one of this crowd.  The really scary thing is that nearly all of the nation’s political class (of both parties, by the way; this is not a Democratic peculiarity) and much of the country’s business leadership is composed of people who share Mr. Emanuel’s background and perception of self.    Their passionate and undying certitude regarding their own perfection, and their unquenchable mission to share their omniscience with all of us, whether we want this favor or not, is dangerous and is wreaking the predictable havoc on a society that at least used to draw its strength from the wisdom of the common man, a wisdom held in complete disdain by Mr. Emanuel and his ilk.


See my two books, The Chairman, A Novel of Big City Politics and The Chairman’s Challenge, A Continuing Novel of Big City Politics, for further illumination on how things work in Chicago and Illinois politics. 



PRESIDENT OBAMA’S REACTION TO THE SAN BERNADINO SHOOTING: POLITICAL CORRECTNESS RUN AMOK

12/3/15

Syed Rizwan Farook and his wife Tashfeen Malik burst into a San Bernardino holiday party in tactical gear and open up on the participants, who were Mr. Farook’s fellow County employees, with assault rifles, killing 14 people and injuring at least another 14.    It is later discovered that the house Mr. Farook and his wife occupied was packed with pipe bombs, and pipe bomb material, in various stages of assembly.   We also learned that Mr. Farook had traveled extensively in the Middle East and that he had extensive contacts with people in the United States whom the FBI considers to be involved in terrorism.  

President Obama, with all this knowledge at his disposal, says

“It is possible that this (the San Bernardino shootings) was terrorist related but we don’t know.  It’s also possible that this was workplace related.”

Possible that this was terrorist related?   What could more closely fit the profile of a terrorist act?  

This could be workplace related?   So Mr. Farook was slighted at work somehow and decided to acquire assault weapons and pipe bombs in response and consulted with suspected terrorist elements in doing so?   Surely Mr. Obama isn’t trying to argue that perhaps Mr. Farook is the victim here, that he was responding to the way he was treated at work….is he?

We have further learned that a neighbor saw many people “of Middle Eastern origin” going into and out of the Farook house carrying packages, but the neighbor didn’t report anything to the police because she didn’t want to racially profile or to be deemed racist.  So now 14 people died, perhaps because someone was paying obeisance to the political correctness that has run amok in our society.   Now the President of the United States is apparently worshipping at that altar of political correctness, failing to call a terrorist act a terrorist act because, after all, we wouldn’t want to prejudge a situation and risk offending…whom?  Terrorists?   Or does Mr. Obama really believe that every Muslim and/or Middle Easterner would be offended if he called what Mr. Farook did what it was…a terrorist act?   Just how sensitive does Mr. Obama think people are?   More properly, just how sensitive is the President?

Perhaps Mr. Obama will give the silent neighbor a Presidential Medal of Freedom for her noble work against racism and stereotyping.