What the Hell is a Moderate Anyway?

I enjoy reading political writers who have both a sense of humor and ask thought provoking questions.  When I read this brief piece by booman, it resonated with me.

What constitutes moderation in Democratic politics? Which policies of mainstream Democrats are simply unacceptable to South Dakotans, for example? I think these are questions that need to be empirically tested. South Dakota clearly preferred Mitt Romney to Barack Obama, but it isn’t entirely clear why they felt that way. While Republicans absolutely dominate on the local level, the Democrats have done very well in recent years on the federal Senate/House level. Why is that?

These same dynamics have played out in North Dakota and Montana, where Democrats have over performed in Senate contests. Senators like Max Baucus, Jon Tester, Byron Dorgan, Kent Conrad, Tim Johnson, and Tom Daschle have certainly been frustrating at times, but it’s hard to find all that much commonality between them in terms of their apostasy from the party platform. I suppose they have probably been less environmentally friendly than your average Democrat. They’ve been cozy with the banking and credit card industries. They’ve been a bit more socially conservative than their peers.

If I had to name something really out of whack, it’s been their obsession with the deficit. Because the other stuff is easily explainable by the fact that they represent sparsely-populated states with a lot of mining and financial services activity and not much religious or ethnic diversity, their love of austerity sticks out.

Opposition to big spending seems to be a requirement in these northern plains states. Is that the key ingredient for success? Or is it possible to use a different playbook? How much of a role does personality play? Jon Tester and Max Baucus don’t seem much alike but they both have success. Kent Conrad struck me as quite a bit more conservative than Byron Dorgan, who could be quite openly partisan at times.

I understand the urge to find a candidate who is seen as moderate, but I can’t pinpoint what moderate really means.

I’m working with a group trying to find a congressional candidate to support who will run against our very conservative congressman here.  The last time we came close to beating him was in 2008 and we had a pretty progressive candidate who barely lost.  In 2010 the same candidate lost by a larger percentage.  And 2012 was awful.  We lost by 25 or 30 percentage points I think, but we’re not sure if it was from redistricting or because of a new and relatively unknown candidate.   Both worked against us of course, but which played the larger part?

We’re a very conservative district, perhaps even more so now, and so I’ve been arguing for a more moderate candidate but I think I’m being out voted.  It’s a pretty liberal group so they want the most progressive candidate we can find.

One of the aspects of politics today that I’ve been fascinated watching is the apparent growing split in the Republican Party between the more ideologically driven members of the base or Tea Party and more traditional or moderate conservatives.  As I’m sure everyone has already heard Bob Dole had a few things to say about today’s Republican Party.

“Reagan couldn’t have made it. Certainly, Nixon couldn’t have made it because he had ideas,” he pointed out. “I just consider myself a Republican, none of this hyphenated stuff. I was a mainstream conservative Republican. It seems to be almost unreal that we can’t get together on a budget or legislation,” Dole said, comparing today’s Congress unfavorably with the institution in which he served for decades. “We weren’t perfect by a long shot, but at least we got our work done.”

Another example, of course, would be John McCain’s criticism of the small group of Senators who appear to be blocking budget negotiations.

I consider myself a moderate on some issues and a progressive on others but I’d still rather be represented by a Democrat than a Republican so I’m willing to compromise a bit.

It’s funny, when Kevin picked the name for this blog, I told him I wasn’t a moderate but now I’m not so sure what that even means or if it matters.

I’m also wondering if any of the conservatives here worry about the same things I do.   Are they being too driven by the base, or political purity, when they might have a better chance at winning more elections if the moderates, or more traditional members of the party had a little more influence?  Or is winning with moderates some sort of cop out?

Morning Report – Fannie Mae comes back to earth 5/30/13

Vital Statistics

  Last Change Percent
S&P Futures  1652.6 5.6 0.34%
Eurostoxx Index 2807.2 20.6 0.74%
Oil (WTI) 92.59 -0.5 -0.58%
LIBOR 0.275 -0.001 -0.40%
US Dollar Index (DXY) 83.7 0.037 0.04%
10 Year Govt Bond Yield 2.14% 0.02%  
Current Coupon Ginnie Mae TBA 101.8 0.4  
Current Coupon Fannie Mae TBA 100.8 -0.2  
RPX Composite Real Estate Index 200.6 0.4  
BankRate 30 Year Fixed Rate Mortgage 3.94    

 

Markets are higher this morning in spite of a 5.2% sell-off in the Nikkei 225 last night. Q1 GDP was revised downward to 2.4% from 2.5%. Initial Jobless Claims rose to 354,000. Bonds and MBS are down small.
 
Yesterday was the first relatively stable day in the Treasury markets in quite some time, notwithstanding the major sell-off in early Asian trading yesterday morning. Today we are more or less in the same place. 
 
The CFPB has tweaked the Ability to Repay rule a tad, with new guidance for mortgage broker compensation and exempting small lenders that focus on low-income lending. These amendments will take effect Jan 1, 2014.
 
It is tempting to think the the U.S. Treasury yield is being driven by differing interpretations of Bernake’s words. And maybe some of it is. But we are seeing a global sell-off in G7 sovereign debt that started at about the same time.  The US Treasury yield is up 54 basis points since May 1. UK Bonds are up 26 basis points. Japanese Government bond yields are up 31 basis points. That is in spite of a new quantitative easing program by the Bank of Japan – think about that! German Bund yields are up 30 basis points. Everyone started selling off more or less on May 1. My point is that there seems to be more going on in US Treasuries than a simple question over when the Fed is going to start tapering QE. Given the move in world stock markets, it feels like a very big investor (probably a sovereign wealth fund) is doing an asset allocation trade out of G7 debt and into stocks. 
 
Remember Fannie Mae, which was more or less given up for dead? Well, it has rallied about fourteenfold since mid March. It sold off had yesterday, but you can’t deny the move. 30 cents to an intraday high of $5.44. This has been one big speculative toy for the past couple of months, while the big hedge funds are in the prefs. If Fannie Mae survives in some way, shape, or form those bets could pay off. However Fannie Mae is simply sending all of its profits to the government, which is not counting them against money it owes. (They changed the rule last Fall, right before Fannie Mae started turning a profit – what a coincidence). Oh, and before you dismiss it as just another “penny stock” – it sports a market cap of $16.7 billion. Anyway, play in this sandbox at your own risk.
 
Chart:  Fannie Mae (FNMA)