The Thin Blue Time Line

It is now July, with only 2.5 months until an election where three branches of of government, the House, the Senate, and the Presidency, are up for grabs. As an investment based retiree, unlike pension based retirees, this can have serious short term impact on the economy and our money. We know that Ron Burgundy (Biden) is planning to raise corporate tax rates, individual taxes, capital gains taxes, estate taxes, eliminate fracking, and require green energy that has not crossed over in cost with existing solutions. Oddly enough, this is happening in a stagnant economy driven by COVID-19. All of these things add up to a stagnant GDP, corporate offshoring, reduced tax basis, higher cost, and an overall hit to the market.

Of course you know Mr Burgundy. Being a retiree, I had time to watch the debates and follow the primaries. It is very clear that this candidate is being handled. If you actually listen to him, you note his limit is around 3 sentences, before he misstates, stumbles, or munges words together. He is making George W, a truly handled candidate and inept president, look like a Rhodes Scholar. As you may recall, I supported The Bern with my wallet in the primaries. Him, along with Tulsi, spoke their true beliefs, and were honest, unlike most every other candidate. So how did we end up with JB? The establishment picked him, because Bernie was cranky, and unbending in his socialist beliefs.

The Blue side is on a very precarious timeline, however. For this Thin Blue Timeline to come together, they need a few key factors to be be in place on November 2^nd. Those factors are: The current death spiral in Blue Cities must end. The crime rates in these cities must come down. The economy must not recover. Ron Burgundy must severely limit his unscripted appearances. The employed people in the middle between Red and Blue who are silently biting their lip keeping quiet, making economic and safety decisions for themselves and their family, must be convinced that the Blue side can better serve their basic needs.

The death spiral in the deep Blue Cities has happened faster than anyone could have anticipated. The willingness of segments of the population to loot and destabilize these areas is a disaster. Real civil rights activists are mortified. Trashing and looting your local Target and Foot Locker does not hurt a well insured corporation. But thousands of jobs lost amongst people that need jobs, is devastating. This, along with the pandemic, has crushed not only retail, but bar and restaurant also. STEM (science, technology, engineering, math) based college grads are not being hurt, and most other college grads are doing better than average. These people are on the more progressive side of the tax bracket, meaning they pay the vast majority of the taxes. So now you get into the big swirly toilet bowl: No jobs. No public safety. Business shuts down or relocates. Visitors such as tourists and business people stop coming. People move away. Tax base declines. This all results in a simple scenario where taxes have to increase and there are fewer high income people to pay, so lower income earners are forced with skyrocketing costs. Then, go right back to No Jobs, and rinse and repeat the entire cycle. For a blue wave in November, this has to stop. Calling for increased taxes is a severe body blow and a boon for the Red. There are blistering hot real estate markets in places “Not New York, Not New Jersey, Not California, Not Seattle, Not Portland, etc.” Myself, along with multiple friends, have contacted industry professionals for local bargains, and effectively been laughed out of the room. People are leaving, and investing elsewhere.

Public safety is of key concern. As a person of color, you are somewhere between 500-1000 times more likely to be killed by another person of color than a police officer**. Infants and toddlers are being killed every week by people of color and it is a horrible state of affairs. I personally cannot say how I would react to a situation where my job every day was to strap on a gunbelt and bullet proof vest, and work in an environment where getting injured or killed is a real possibility. That in no way justifies bad police conduct and that has to be corrected. I just cannot tell you for sure I would approach everyone with compassion, when I know some percentage want to gun me down. BUT, it also does not justify reducing or eliminating policing. Areas that have done this have seen immediate jumps in violent crime and deaths, at levels we have not seen for decades. These numbers will not be ignored throughout the next two months. When you see any union jump to the Red side, as major police unions are now doing, it represents a tectonic shift. Blue cities must get crime under control, and quickly. November looms large.

The stock market has recovered the majority of the losses. The economy in general, however, is still struggling. A key fight needed to win by the Blue is extending the extra $600 per month unemployment and keep people at home in any way possible. This keeps employment low. In addition, any future lockdown is a benefit for a more negative economy. A market and economy with positive trajectory works against the Blue Wave, and needs to be retarded until November. The context of the next stimulus package is critical.

Ron Burgundy did extremely well in his basement, doing nothing but watching the President hurt hisself. DT is an egomaniac narcissist and it shows under stress. Unfortunately, Mr Burgundy can’t hide out until November, and will have to make public appearances where he talks, much to the chagrin of the establishment. Coupling this with the rage he has been known to fling himself into when challenged, makes the next 2.5 months problematic. John McCain, as a candidate, had two glaring problems. The first was his choice of Vice President, and the second was his obvious short temper, which put people off. Both of these items, along with no being able to effectively complete sentences, will grind at the electorate. Selling across the board tax increases and higher gas prices due to no fracking is going to be a tough sell, and he will need to be carefully managed until election day.

What this comes down to is how will middle America react. The deep Blue and the dark Red have already decided their votes. If the middle sees increased crime and severe degradation in our once proud cities, and increased taxes they are going to lean Red. If they see a bungled COVID response and minorities getting abused by cops, they will lean Blue. You can take all the polls you want. They are going to be completely worthless. When people have a personal stake in the elections, they tend to show up and vote how they feel best protects their own needs, and they don’t answer questions. It is going to be a fascinating two months.

**these are Chicago stats only. I have not dug into, or do I understand, the FBI database.