Fed chair alarms market; Grenada; a GOP moderate

 

Fed chair alarms market; Grenada; a GOP moderate

Brief notes of the week

 

Gordon L. Weil

New Fed chair raises alarm

The new Federal Reserve chair has lost support in financial markets in record time.  The non-financial media and the political world have not caught on, but his moves to recast the Fed’s role is causing reactions approaching alarm.  One leading expert opined that “the bond market puked on him.”

The Fed sets short-term interest rates and buys and sells federal debt to influence long-term rates.   It has huge economic clout, alongside the federal government’s spending and taxing. But Kevin Warsh wants to keep quiet about the Fed’s future thinking on interest rates and to reduce its holdings of federal debt. 

Warsh wants the market to drive the economic policies, uninfluenced by Fed forecasts.  He believes that market participants should “play the game rather than watch the referee.”

That would make the economy a playing field (between what parties?) with the Fed assuring fair play.  Meanwhile, the Fed would say less and, presumably, do less.  The Federal Open Market Committee, composed of Fed Board governors and regional Fed bank presidents, could meet less often.

The market wasted no time in reacting to Warsh’s closed-mouth policy, scolding him for not recognizing that the Fed is a major player not simply a ref.  Left unsure of the Fed’s future thinking, the market lifted interest rates.

FOMC members are independent of the chair, making it likely that his new policy lost him support.  The powerful president of the New York Fed bank quickly sketched his view of the economic future.  Other members split with Warsh on rates.

Ironically, the man Trump sent to lower interest rates finds that the president’s Iran war and his own policy shift increase rates.

Grenada or Greenland

The State Department is reportedly closing several diplomatic offices abroad, including the embassy in Grenada, a small, independent country in the Caribbean, located about 100 miles from Venezuela by sea.

The U.S. invaded it in 1983 when Ronald Reagan was president, because of fears it was coming under the influence of Cuba and Russia.  In more recent years, it has developed a two-party political system with elections resulting in peaceful change.  Grenada’s sovereign is Charles III, the King of Grenada and of the United Kingdom.  Grenada has a population of about 115,000.

Its economy depends on tourism and the export of nutmeg and other spices.  Its major economic problem is the large burden of public debt.  It is avid about the game of cricket, and China has financed a $40 million stadium there.

This year, the U.S. opened a consulate in Nuuk, Greenland, which is an autonomous territory of Denmark.   The U.S. has an embassy in Copenhagen, the Danish capital, to which the consulate is subordinate.  Greenland’s sovereign is King Frederik X of Denmark.

The population of Greenland is about 57,000.  While it has half the population of Granada, President Trump wants to acquire it over the opposition of Greenland, Denmark, the EU and Canada.  Its area is 6,288 times greater than Grenada’s.

Trump worries about China having invested in Greenland, and wants to take overt action.  He is unconcerned about Grenada, where China has also shown interest.  Despite its potentially strategic location, Grenada is not in the running to be the 51st state.

How to be a Republican moderate

A moderate is defined in Congress as a senator or representative who sometimes splits with their party to vote with the other side.  Their vote may be especially telling if they oppose a president of the same party.

In the age of extreme partisanship, acquiring the status of a moderate requires only a handful of votes in opposition to one’s own party.

But there is one step even better, enabling the dissenter to break with the party to justify home-state claims to be a moderate without the vote making any difference.  You can vote against your party when it has enough votes to prevail without your help.

Voters in the home state are supposed to see the independence asserted by the officeholder, which gains them votes.  Party allies in Congress accept the opposing vote, aware of its help to the supposed moderate and the continued loyalty of the senator or representative. You can almost see the nod and wink.

This week, Maine Sen. Susan Collins was the sole Republican to vote with Democrats on an environmental issue.  No matter, the GOP had enough votes to defeat it.  Facing a tough reelection, Collins could add evidence to her claim to being a moderate.

She also announced that she would vote against the confirmation of Todd Blanche as Attorney-General.  By announcing early, she could avoid direct responsibility for being the swing vote.  He would squeak by without her vote.  Maybe her vote would dim memories of her unpopular support for Justice Brett Kavanaugh or Secretary Bobby Kennedy, Jr.

The Platner affair and what it does and doesn’t mean

 

The Platner affair and what it does and doesn’t mean

Maine goes it own way, not what the pundits say

Gordon L. Weil

 

“As Maine Goes, So Goes the Nation.”

When Maine formerly voted in September, the result might predict the national result in November.  It didn’t, and the saying died.

But it seems to be making a comeback.  The selection of a replacement candidate for the U.S. Senate has led the national media to act as if Maine is again the great predicter.  They’re wrong, and the saying can stay dead.

Having been involved in Maine Democratic politics for decades, here is my perspective in the selection a replacement for scandal-prone Graham Platner.

What is the focus of the Maine Senate election?

Donald Trump.  Many voters have tired of him and see Sen. Susan Collins as a Republican enabler, who should be replaced. The Democratic candidate needs to be the person most likely to keep her from a sixth term, as the best way to control Trump.

How did Platner get the nomination?

Maine Gov. Janet Mills was the pick of the Washington Democratic leaders as the most likely person to defeat Collins.  Their judgment was based on her having won two statewide elections.   But they ignored that she has been a center-right governor, sometimes overriding her own Democratically dominated Legislature.  Plus, she would be the oldest first-year U.S. senator ever.

Platner is younger and aligned with a progressive state Democratic Party. He ran with nothing to lose, when the Party had automatically accepted Mills, the conventional choice.   Without much competition, he quickly began polling better than Mills.  Her money dried up.

Did Platner’s selection reflect a split between progressives and moderates?

Possibly, but not much.  First, there’s not a deep split in Maine.  The Democrats are generally progressive.  Second, it was a matter of age.  Collins is old. Sen. Angus King is old. Mills is old.  While the state itself has the oldest median age, old people recognize the limits of age, and younger people feel disenfranchised.

In the 2016 Maine Democratic caucuses and convention, Sen. Bernie Sanders, the progressive, defeated Sec. Hilary Clinton, the moderate, by 64% to 36%.  The progressives won 10 years ago.  Platner’s win was not a major shift, though it revealed the Party’s disappointment with Mills.

To be clear, the pundits are wrong.  They read too much into the split among Democratic hopefuls.  It’s about ambition and not ideology.  None of the aspirants is as right-leaning as Mills.  The race is not focused on a struggle between progressives and moderates, though some aspirants may try to promote themselves as moderates, fulfilling the false scenario.

Should Platner have been better vetted?

Sanders’ endorsement of Platner made his candidacy.  Based on his platform, in line with Sanders-Warren, there’s no indication that any attention was paid to his character.  It was much like Sen. Minority Leader Chuck Schumer’s endorsement of Mills, based on his superficial finding that she could defeat Collins, while ignoring her problems with Maine Democrats.

The endorsements of Mills and then of Platner tried to impose judgments “from away” on Maine Democrats.  Mainers might have expected that national leaders had vetted their choices.  That didn’t happen.   Perhaps Trump’s success has made personal defects irrelevant to political choice. 

In the end, in Maine at least, personal issues finally mattered.  His potential ability to beat Susan Collins was not enough to keep Platner in the race.

Was Platner forced out by establishment Democrats?

His candidacy achieved credibility when he received endorsements, with accompanying funding, from national Democrats.  Any doubts about his legitimacy were erased.  He was largely created by the establishment.  After he abused their trust and confidence, they dropped him and with them went credibility and cash.

How will his replacement be selected?

Seeking to avoid any mistake that would recall the choice of Kamala Harris as the Democratic presidential candidate, the Maine Party has decided to hold a weekend convention July 25-26 with about 600 participants, composed of the State Committee members and delegates selected by caucuses in each of Maine’s 16 counties.

The delegates will not be pledged to candidates. The convention will hear from all of them, before voting.  The Party will inform State Government of the candidate on July 27.

Who is in the race?

Three kinds of candidates.  First, present or former officeholders.   Second, losers in the recent primary for governor or Second House District, including people who have never won an election.  Third, outsiders who offer a new face.  Each must get voter signatures to run.

It’s probable that the first group will produce the candidate, either Secretary of State Shenna Bellows or former Senate President Troy Jackson.   Both ran for governor, but did not gain the nomination. 

Bellows ran well in central Maine, might appeal as a female candidate, and has a strong anti-Trump record, having fought him in court.  Jackson ran well in northern Maine, where his appeal could help the Party, and was endorsed by Sanders.  He will appeal to former Platner supporters.  Both he and Bellows are well-liked former legislators and not hostile to one another.

In the second group is Nirav Shah, the former State CDC director, who did well in the governor’s primary.   A relatively recent Maine resident, he has not held elective office.

It’s possible the two-week campaign will draw positive attention to the Democrats, allowing them to leave Platner behind.  The Platner affair could end up helping the Democrats. Collins has already signaled that her backers will go on the attack, no matter who is the nominee.

Pushback on Trump's power

Gordon L. Weil

When President Trump was asked about any limits on his powers in world affairs, he replied, “Yeah, there is one thing. My own morality. My own mind. It’s the only thing that can stop me.”

His view that he makes his own rules also applies to his authority in domestic affairs.  He has ignored the Constitution and laws.  His first year in office has shown his remarkable ability to do almost whatever he wanted without anybody being able to limit his moves.

In international affairs, American military and economic power discourage other nations from opposing him.  Most countries have accepted his unilateral actions, but he faced unexpected opposition.  China and Canada pushed back on his tariff policy, concluding that appeasement would not work.  Opposing his claim to Greenland, Europe has strongly backed Denmark.

In domestic affairs, Trump intimidated House and Senate GOP majorities by threatening to support primary challengers to disloyal Republicans.  His strategy worked, allowing him to get his way politically.  The thin red line held.  The Democrats could do nothing more than flail.  When he overrode Congress, the Supreme Court usually approved.

Signs are now emerging that his absolute power is limited.

His standing in public opinion polls has slipped.  A majority of the public is dissatisfied in all policy areas and in his overall performance.   Buoyed by good 2025 election results, the Democrats have begun to hope those sentiments would bring 2026 election victories, gaining them a congressional check on his actions.

Recently, his virtually total hold on congressional Republicans has begun to weaken.   House GOP representatives openly charge they are ignored.  A few Republicans have decided not to seek reelection. 

One probable reason for these signs of diminished loyalty is despair over Congress having lost most of its powers.  It is often bypassed or taken for granted.  And, some of his most loyal backers worry openly that he is abandoning basic MAGA isolationist commitments by sending American forces into conflicts involving Iran, Syria, Yemen and Venezuela.

MAGA loyalty verges on being a political cult, where anything Trump decides is deemed to be necessary and appropriate.  But its is now being challenged by some of its most loyal followers.   They align increasingly with traditional, conservative Republicans, who are not Trump backers.

The Democrats gained from resisting cuts to the Affordable Care Act, even though the result was a government shutdown.  Millions of Americans were placed in jeopardy by the GOP policy and are suffering from the end of the subsidies.  They are forced to pay budget-breaking premiums or lose coverage altogether.   

Some Republicans sought to adopt a short extension, allowing time for dealing with ACA reform, but the House was kept out of session, making any negotiations impossible.  Some members faced constituent anger.   They found that Trump & Co. put this government cost-cutting ahead of real human needs. 

This month, the dam broke.  Overcoming the obstinacy from GOP legislative leaders who followed Trump’s wishes, eleven House Republicans joined the Democrats in voting to extend the ACA subsidies.  The political reality of voter discontent pushed them to break ranks.  This was a major split with the president.

Previously, Congress had passed two bills unanimously.  One would bring a fresh water conduit to a part of Colorado. The other aided the Miccosukee Indian tribe in Florida and enhanced the environment.  Trump vetoed both bills.

He demands that the Democratic governor of Colorado pardon an MAGA-oriented election clerk convicted by a jury of tampering with voting machines, but the governor refuses.  Thus, the veto.   The tribe opposes the nearby Alligator Alcatraz for immigrants, which he favors.  Thus, the veto. 

It takes two-thirds of the House to override a veto and, in both cases, some Republicans lined up with Democrats.  But the result fell short of the required number as most GOP House members flipped their position to support the president.  Still, the defections showed that Trump’s absolute control is slipping.

The third event came after the Venezuela incursion.  The Senate voted that taking further Trump action there could be subject to a congressional override.  Though the resolution won’t become law and would not be used if it passed, five GOP senators were willing to break with a furious president. 

Maine Sen. Susan Collins was one of the five, and Trump said she should never again be elected to office.   Does he want her to face a MAGA primary challenger?  Does he want his loyalists to sit out the election?   Either way, he could be helping the Democrats pick up the seat. 

All this pushback happened in the one week of the new year.  For the first time in his second term, he was seriously and repeatedly challenged by his own party members.  He was not forced to change any policy, but he has now faced open GOP congressional concern with his being left to rule, checked only by his own “morality.”  

Maine Gov. Mills wants Collins' Senate seat

 

Gordon L. Weil

The formal announcement Tuesday by Maine Gov. Janet Mills that she will seek the Democratic nomination for the U.S. Senate seat now held by Republican Susan Collins deserves attention.

Collins’ skill consists in convincing Maine voters she’s a moderate.  But her support for some of Trump’s actions and appointments look less like her traditional balancing between two sides and more like temporizing.  Her support for Justice Kavanaugh and Secretary Kennedy work against her.  The political situation has become too dire for some voters to accept her usual approach.

Mills is a right of center Democrat in a state that is majority Democratic with a heavy concentration in the southern First C.D. and a smaller GOP preference in the Second C.D.  By her own balancing, she has managed to rile some liberal Democrats.  Whether she has pleased more conservative voters remains to be seen.

Mills is 77 years old.  She would be the oldest first-year senator ever.  Even if candidates soft- peddle the age issue, it is sure to be a factor.  Collins is 72 and Sen. Angus King is 80.  Mills has been endorsed by Sen. Chuck Schumer, which probably means little in Maine, though it tells you something about how he sees his role.

She will face a primary challenge next June from several declared candidates.  Right now, Graham Platner, an oyster farm operator, veteran and local official, seems to be the most serious. He’s raising money and has the strong backing of Sen. Bernie Sanders.  Could Platner be Maine’s Mamdani (though less progressive)?

In some ways, the outcome of a Mills-Platner contest could suggest the direction of the Democrats.  Younger voters may want a change from the usual balancing by the state’s major politicians.  For example, in the two state referendums this fall, Mills opposes GOP efforts to make voting more difficult, and opposes a red flag law. That’s one for each side. 

Maine will be a money magnet.  The referendums are attracting major funding as will the Democratic primaries for Senate and governor.  Of course, the GOP will go all out for Collins, a possible key to their holding their Senate majority.

Collins, even when she starts out with low poll numbers, has succeeded in defeating relatively weak Democratic candidates.  This year, Mills, who has won two state-wide elections for governor and is well-known, is a different kind of challenger with a track record.  Collins has not yet announced that she’s running.

Are the times right for Mills rolling to primary and election wins?  Could be, but watch for the Democratic left and if Collins can sustain her appeal as a moderate.