6/25/2014
By Charles Payne

“This was your victory. This is your congressman. And you can rest assured that what I’ll do is be thinking about you and bringing those resources home” -Charlie Rangel

Last night, we saw two entrenched politicians defy the national mood to win reelection. In Mississippi, incumbent Thad Cochran beat Chris McDaniel, while Charlie Rangel squeaked by State Senator Adriano Espaillat in his bid to keep his congressional seat. Polls had McDaniel winning and demographic changes that now have Hispanics as the largest ethnic group in Rangel’s district made these intriguing races. Mostly, it was a chance to see just how disappointed we really are with our elected leaders.

The polls say we’re really fed up, but voting results say we like our own as long as they bring home the bacon…or as Rep. Rangel phrases it “those resources.”

Ugly Politics

In the primary, Chris McDaniel beat Thad Cochran and polls had him with as much as a double-digit lead. So, what happened? The race/fear card was introduced as Cochran, with the help of national organizations like the NAACP, lured Black and democrat voters to the open primary by painting the Tea Party as the next coming of the Ku Klux Klan.

The plan worked, but we have to ask at what cost? Using buzz words and phrases like “don’t be intimidated” and “return to a bygone era” conjures up feelings that impede all forms of progress, including economic.

I get where a poor voter would fear losing their benefits, but a nation focused on securing minimum income and education make their own abyss deeper. For politicians looking to upset the freebie bandwagon, the onus is on them for selling the idea to those that feel most vulnerable to change. Hatred and fear as political weapons is dangerous and wrong.

Thad Cochran came to Washington DC, in 1973, at first, as a Congressman. Cochran later became and has been a Senator since 1978. Charlie Rangel arrived at the nation’s capital, before Cochran, in 1971.

During those forty years, these two elected representatives have been entrenched in Washington DC and have squandered the trust of the public while America’s influence around the world has waned. The nation’s debt marches toward $18.0 trillion and it feels like we’ve been stuck in the mud forever. From my vantage point, America loss big time, last night, but I guess the locals won and can rest assured that their guys are back on the job looting the joint.

Blame it all on Weather?

Everyone expected a weak GDP revision, but -2.9 are beyond shocking and it cannot all be blamed on weather. It can be argued that this is old news, but it’s also devastating news and yet another indictment on economic policies that have resulted in the poorest post-recession recovery on record.

Most economists have said that the negative impact of healthcare is the biggest reason for massive downside adjustment to the GDP. Not a great harbinger of things to come on healthcare.

Before the GDP report was released, the market hinted at being much higher. Now, yesterday’s selling has resumed, so it could be a hold-onto-your hat session. The rally has to be tested from time to time and this is certainly a great way to test whether investors believe the rear-view has no bearing on the road ahead. I think the second half of the year will be much better, but never as great as it could and should be given our economic foundation and abilities.

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Charles Payne
Wall Street Strategies

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