Tuesday afternoon

As I think of the fabulous Moody Blues’ song, let me share a few random musings on this cloudy Tuesday. Technically, it is morning here, but since Greenwich time is five hours ahead, the title has merit.

If we look at the US presidential election, what are the signals telling us? The Democrat candidate is being supported by major party leadership, some of whom are on the campaign trail. Senator Elizabeth Warren, who scares Republicans because of her history of fighting for those who have been screwed over, has joined with Hillary Clinton to advocate the message of helping the middle class and those in need with actual programs. There is no better advocate for the disenfranchised than Warren.

On the flip side, the Republican candidate has leaders bailing on him and hiding when he says his latest inane thing. Conservative columnist Michael Gerson has been against Donald Trump and what he represents from the outset and George Will just left the party because of Trump’s presumptive nomination. And, no living president supports his candidacy with the only foreign leaders who have advocated for him are Vladimir Putin and Kim Jong Un.

In Scotland, Trump noted what a good thing Brexit is, yet the financial markets, debt downgrading, and the lowest pound in over 30 years are giving many pause. Plus, he said this in Scotland who voted to remain and have started plans for another referendum to leave the UK and stay in the EU. This is supposed to be the candidate with the best business acumen, but yet again he shows little grasp of the issues, even financial ones. What the Remain camp failed to explain is the number of jobs created in the UK by being in the EU, with companies who have placed their European headquarters and plants there to have duty-free access to Europe.

The US Supreme Court handed down several important verdicts this week. The first one was a tie, but left standing a lower court ruling that President Obama went a bridge too far on his immigration executive orders after Congress failed to act for so long. Next, Affirmative Action was upheld in a Texas lawsuit that argued college admissions could no longer use race to determine acceptances of applicants. The Supreme Court said the colleges could continue to use race as a factor. A lesser publicized ruling noted that people who had been convicted of domestic violence crimes could be denied access to gun purchases in a state that said it was illegal. The court upheld Maine’s right to deny gun access.

But, the biggest ruling was against Texas 5 to 3 that overturned a lower court ruling on abortion clinic access. The Supreme Court ruled that what Texas did, which was use arguments for women’s health as a ruse to close down too many clinics. The data and examples of other less safe procedures that were allowed to go on in clinics revealed a purposeful attempt to severely limit women access. This was a huge win for women’s rights on allowing what to do with her body. Experts have noted this is the most important ruling on women’s right to abortion since 1992.

That is all for now. Have a great Tuesday.

 

 

We are pulling for you, but you have an uphill climb

When a good friend does something that you suggested he or she not do as it is fraught with peril, you are concerned, but still care for them and pull for them. This is especially true when, as an outsider, you can see more clearly the troubles with a decision to do something. It gives you a sick feeling, but you will do your best to help them soldier on.

That is how many feel about our friends in the UK with Brexit, a vote to leave the European Union. I recognize the EU is imperfect like any government entity and needs improvements, but the global construct is more beneficial than it is not, due to more trade and freedom of movement. Working collaboratively, also helps lessen the risk of national turmoil which can cause unhealthy behaviors.

The global financial markets have shown an immediate displeasure with the change with significant declines and the pound priced at a 35 year low. Watching BBC World News America and PBS Newshour, where many global financial and political experts spoke, the sense is this is not just a short term aberration and that the Brexit will cause more long term financial anguish. Plus, with Scotland poised to initiate another referendum to leave the UK, this time to rejoin the EU, coupled with Northern Ireland considering the same, this does not look promising. June 23, 2016 may be remembered as the beginning of the end of the current UK construct.

All of this is unfortunate. Clearly, the UK citizens have a right to decide on their own country. Yet, in addition to Scottish and Northern Irish voters wanting to remain, the people under the age of 35 clearly wanted to remain, as they see the continued job opportunities with a solid EU. So, this is not a universally appreciated decision. What these folks see is non-UK companies setting up headquarters in the UK for their Europe business. With this change, my guess is some will consider relocating those to the Republic of Ireland or on the main continent. London’s loss may be Dublin, Paris or Frankfurt’s gain.

The UK will soldier on and the US will continue to support it. We will pull for you, but the climb is now more uphill. We should be reducing barriers to trade, not erecting them. No one is relishing redoing trade agreements with all of these entities. The uncertainty created just by this process alone will cause issues. Plus, it adds the uncertainty of other EU countries following suit. The more disruption, the harder trade becomes and creates opportunities for unhealthy nationalism.

The EU does need to do a better job of governance. The EU does need to do a better job of allowing the pipe on immigrants to be tightened and loosened dependent on the labor demands of an individual  country. These are fixable problems, but they need to be worked at collectively and with due consideration of one’s country’s labor market. Leaving the EU makes everything a little bit harder to accomplish.

I know the “Leave” voters are happy, but the rest of the world is saddened (with some exceptions), that the vote to remain was defeated. And, that is unfortunate. It would be my sincere hope is that the next few months will allow the UK to reconsider its decision and proceed with a new vote. This may be precipitated by a need to ward off Scottish and Northern Irish votes to leave the UK.