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Politics, economics and a pandemic: Equity markets under pressure – Investors' Corner BNP Paribas

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Early trading in September saw heavy profit-taking, the US S&P 500 index having just set a record high when it closed on 2 September, the same day it had marked a rise of nearly 11% since the start of the year.

Labouring under substantial profit-taking and certain technicalities, US tech stocks were hit particularly hard, with the Nasdaq composite index correcting by 10% between 2 and 8 September.

These swings brought with them a rise in implied volatility: The VIX index, calculated on S&P 500 options, rose in a few days from 22 to 34, its highest since the end of June.

However, there was only limited contagion to other major stock markets and other risky assets and so the ‘risk off’ phase failed to really take hold.

  • Firstly, volatility eased and eurozone indices held up well for most of the month; in Tokyo, the stock market even ended slightly higher.
  • Secondly, US equities rose at the end of the period, driven in particular by hopes of an agreement in Congress on new fiscal measures.

Over the month, global equities fell by 3.4% (MSCI AC World index in US dollar terms). Coming after five consecutive monthly gains, the drop reflected concerns about the resurgence of COVID-19. The rise in the number of infected cases and hospitalisation led many countries to beef up social distancing measures: There was a re-imposed lockdown in Israel, local lockdowns in Spain, restrictions on public gatherings and shorter bar and restaurant opening hours in France, the UK and Germany in particular.

The threat of a second wave and such responses reminded investors of the real uncertainties hanging over the global economy – something they had chosen to ignore mostly during the summer. Disappointing activity indicators, particularly in the eurozone, fuelled investor concerns by highlighting signs that the recovery was running out of steam after the mechanical (and rapid) catch-up since May.

Against this backdrop, the renewed commitments from the main central banks to maintain their highly accommodative monetary policies for a long time, or even to take additional measures if needed, failed to fully reassure equity investors.

Recent economic data has been encouraging. Activity is returning to pre-pandemic levels in many sectors of the Chinese economy and the pick-up in demand on Asian exporters is favourable. Moreover, the epidemic appears to be under better control than in major Western countries and other emerging markets. Emerging Asia’s better resilience helped the MSCI Emerging Markets index (-1.8% in USD terms) outperform developed markets.

US equities underperformed other major markets. The S&P 500 lost 3.9% and the Nasdaq composite 5.2%. This decline, however, still leaves the Nasdaq up by 24.5% year-to-date (+4.1% for the S&P 500).

European stock markets ended down: -2.4% for the EuroSTOXX 50, which has fallen by 14.7% so far in 2020, reflecting in particular by the weakness in financial stocks.

In Tokyo, the Topix ended up slightly (+0.5%), supported by the Bank of Japan’s asset purchases and by the recovery in demand in Asia. The Japanese government’s change of leadership, which was quick and smooth, was seen as ensuring continuity in economic policy.

At the global level, cyclical sectors, including some subsectors of technology, outperformed the rest of the market. Energy and banks saw the biggest monthly declines.

The EUR/USD exchange rate, having peered above 1.20 on 1 September, first stabilised at around 1.18 before heading towards 1.16. Market participants had expected comments from members of the ECB Governing Council to end the rapid appreciation of the euro since late May, when the exchange rate was below 1.10.

Market moves in September were a result of concerns over eurozone growth and the drop in equities that led investors to favour the US dollar.

EUR/USD finished the month at 1.1743, down by 1.7% compared to the end of August. Even so, the euro appreciated over the third quarter.

Exhibit 1: Changes in the EUR/USD exchange rate from January 2018 to September 2020

After the ECB’s policy meeting on 10 September, there were no changes in key rates, asset purchase programmes or forward guidance. While this had largely been expected, observers were disappointed on several points, and were left with the impression that the ECB’s stance was a little less dovish than expected.

This feeling was compounded by various rumours that some council members would have liked the upward revision of the GDP forecast to have been better highlighted. An 8% drop in eurozone GDP is now expected for 2020, while in June the ECB had forecast a drop of 8.7%. This was mainly due to a somewhat smaller decline in Q2.

The ECB’s reaction to the euro’s gains seemed low key. As is customary, the ECB has talked about the effects on inflation of a strong currency. However, its statements have remained muted and suggest the council is not too concerned about the euro hovering at around USD 1.18. Yet only the day after the meeting, several comments on this topic suggested dissensions among council members.

Against this background, expectations remain high for an announcement in December of a further increase in the asset purchase enveloppes, or a reallocation between programmes – and this despite some comments giving the impression that the envelope of the PEPP (Pandemic emergency purchase programme) may not be fully used.

The investor optimism that prevailed in July and August weakened in September. The difficulties encountered at the start of the month by US tech stocks spread to other risk assets, although without markets reaching for the panic button.

As signs of a second wave of COVID-19 mount, investors seem to have suddenly become aware of the fragility of the global economy. After the slump in activity in the spring and the rapid rebound from May onwards, momentum has recently flagged.

In addition, as the US election approaches and Brexit negotiations enter the final straight, political factors will come more to the fore in the coming weeks.

And among these health, economic and political uncertainties, there are likely to be delays in the adoption of new fiscal support measures in the US and Europe. Equity movements could be erratic in the short term even if a still rather cautious investor positioning is likely to limit the downside.

In the medium term, proactive economic policies should ensure a favourable environment. The message from central banks is clear: The monetary policies put in place will allow long-term rates to remain low for a long time.

Such an environment is supportive of equities and risk assets generally. In addition, advances in medical research should become more tangible over coming months and help boost economic agents’ confidence. This remains crucial for a sustainable recovery that can spread across all sectors.

Beyond possible short-term headwinds, we remain cautiously optimistic and, depending on the signals sent by our proprietary market ‘temperature’ indicators, we may look at bearish developments as opportunities to strengthen our equity position.


Any views expressed here are those of the author as of the date of publication, are based on available information, and are subject to change without notice. Individual portfolio management teams may hold different views and may take different investment decisions for different clients. This document does not constitute investment advice.

The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. Past performance is no guarantee for future returns.

Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions).

Some emerging markets offer less security than the majority of international developed markets. For this reason, services for portfolio transactions, liquidation and conservation on behalf of funds invested in emerging markets may carry greater risk.

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A longtime fixture in U.S. politics, Biden seeks to win elusive prize – TheChronicleHerald.ca

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By Will Dunham

WASHINGTON (Reuters) – Joe Biden, a fixture in U.S. politics for a half century as a senator and vice president, is seeking to complete a long climb to the political mountaintop that includes two previous failed presidential bids by defeating President Donald Trump on Tuesday.

If Biden beats the Republican president, a fellow septuagenarian, the 77-year-old Democrat from Delaware would become the oldest person ever elected to the White House.

Biden has sought to portray his political experience as a benefit, casting himself as a tested leader up to the tasks of healing a nation battered by the coronavirus pandemic and providing steadiness after the turbulence of Trump’s presidency.

Accepting the Democratic presidential nomination in August, Biden stressed compassion and decency, seeking to draw a contrast with the pugnacious Trump.

“I’ll be an ally of the light,” Biden said, “not the darkness.”

Trump has derided him as “Sleepy Joe” and said his mental capacity was “shot” as the president’s allies sought to portray Biden as senile.

If elected, Biden would be 78 years old upon inauguration on Jan. 20. Trump, 74, was the oldest person to assume the presidency when he was sworn in at age 70 in 2017.

Biden unsuccessfully sought the Democratic presidential nomination in 1988 and 2008 before finally securing his party’s blessing this year with strong support among Black voters.

He brings to his political career a mix of blue-collar credentials, foreign policy experience and a compelling life story marked by family tragedy – the loss of his first wife and a daughter in a car crash, and a son to cancer.

Biden arrived in Washington as a young upstart. He was elected in 1972 at age 29 to the U.S. Senate from Delaware and remained there for 36 years before serving from 2009 to 2017 as vice president under Barack Obama, the country’s first Black president.

Trump has sought to turn Biden’s experience into a liability, denouncing him as a career politician. Trump has said Biden would become a puppet of the Democratic Party’s “radical left.”

The coronavirus pandemic has been front and center in the presidential race. Biden accuses Trump of surrendering in the face of the public health crisis, saying the president panicked and tried to wish away the virus rather than do the hard work needed to get it under control, leaving the economy in shambles and millions of people jobless.

Trump, who was hospitalized for three days after contracting COVID-19, has mocked Biden for regularly wearing a face mask to guard against the pathogen’s spread.

‘THE SOUL OF THIS NATION’

After serving as vice president, Biden opted not to run for president in 2016, only to watch Trump defeat Democrat Hillary Clinton. When Biden announced his 2020 candidacy in April 2019, he took aim at Trump.

“We are in the battle for the soul of this nation,” Biden said, adding that if re-elected Trump would “forever and fundamentally alter the character of this nation – who we are – and I cannot stand by and watch that happen.”

Biden selected Senator Kamala Harris – whose father is an immigrant from Jamaica and whose mother is an immigrant from India – as his running mate, making her the first Black woman and first person of Asian descent on a major-party U.S. ticket. At 56, Harris is a generation younger than Biden.

An effort by Trump to dig up dirt on Biden resulted in the president’s impeachment in the Democratic-controlled U.S. House of Representatives in December 2019. The two articles of impeachment – abuse of power and obstruction of Congress – stemmed from Trump’s request that Ukraine investigate Biden and his son Hunter on unsubstantiated corruption allegations.

In February, the Senate, controlled by Trump’s fellow Republicans, acquitted him of the charges after refusing to call any witnesses.

U.S. intelligence agencies and the FBI director this year concluded that Russia, after interfering in the 2016 election to harm Trump’s opponent Clinton, was engaging in a campaign to denigrate Biden and boost Trump’s re-election chances while promoting discord in the United States.

Biden’s previous two presidential runs did not go well. He dropped out of the 1988 race after allegations that he had plagiarized some speech lines from British Labour Party leader Neil Kinnock. In 2008, Biden won little support and withdrew, only to be selected later as Obama’s running mate.

The folksy Biden, known for blunt talk and occasional verbal gaffes, has often referenced his working-class roots to connect with ordinary Americans. Biden also was the first Roman Catholic U.S. vice president.

Under Obama, Biden served as a troubleshooter on matters of war and foreign affairs and on domestic issues such as gun control and fiscal policy.

Obama did not always heed Biden’s advice. Obama gave the go-ahead for the 2011 raid in Pakistan that killed al Qaeda leader Osama bin Laden despite Biden’s warning that it was too risky.

Biden speaks openly about his family’s tragedies including the 1972 car crash that killed his first wife, Neilia, and their 13-month-old daughter, Naomi, weeks after his election to the Senate.

He almost abandoned his political career to care for his two young sons who survived the accident but stayed on, commuting by train from Delaware to Washington to avoid uprooting them.

In 2015, his son Joseph “Beau” Biden III, an Iraq war veteran who had served as Delaware’s attorney general, died from brain cancer at age 46. Biden’s son Hunter struggled with drug issues as an adult.

Biden himself had a health scare in 1988 when he suffered two brain aneurysms.

BLUE-COLLAR BACKGROUND

Biden was born in the blue-collar city of Scranton, Pennsylvania, the eldest of four siblings. His family later moved to Delaware. Biden overcame stuttering as a boy by reciting passages of poetry to a mirror.

He was practically a political novice – having served two years on a county board in Delaware – when in 1972 he became the fifth-youngest elected senator in U.S. history.

Despite years of partisan hostilities in Washington, Biden remained a believer in bipartisanship. During his time in the Senate, Biden was known for his close working relationships with some of his Republican colleagues. In addition, a number of disaffected Republicans, including former government officials and former lawmakers, alarmed at Trump’s presidency have endorsed Biden.

Biden also advocated for America’s role as a leader on the world stage at a time when Trump was abandoning international agreements and alienating longtime foreign allies.

One of Biden’s accomplishments as a senator was helping to secure passage in 1994 of a law called the Violence Against Women Act to protect victims of domestic crimes.

While in the Senate, Biden built up a specialty in foreign affairs and at one time headed the Foreign Relations Committee. He voted in favor of authorizing the 2003 Iraq invasion before becoming a critic of Republican President George W. Bush’s handling of the war.

Biden was criticized as chairman of the Senate Judiciary Committee in 1991 for his handling of sexual harassment accusations against Republican President George H.W. Bush’s conservative Supreme Court nominee Clarence Thomas by former aide Anita Hill. Liberals criticized him for doing too little to defend Hill’s allegations, which Thomas had denied.

The committee held explosive televised hearings prior to Thomas’s eventual Senate confirmation. Thomas accused Biden’s committee of conducting “a high-tech lynching for uppity Blacks who in any way deign to think for themselves, to do for themselves, to have different ideas.”

In May of this year, Biden denied a former Senate aide’s accusation that he had sexually assaulted her in 1993, calling the claim “not true” and saying “unequivocally it never, never happened.” The allegation was made by a California woman named Tara Reade who worked as a staff assistant in Biden’s Senate office for about 10 months.

Reade was one of eight women who in 2019 came forward to say Biden had hugged, kissed or touched them in ways that made them uncomfortable, though none accused him of sexual assault. Reade publicly accused him of the assault months later.

(Reporting by Will Dunham; Editing by Howard Goller)

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A longtime fixture in U.S. politics, Biden seeks to win elusive prize – Reuters Canada

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WASHINGTON (Reuters) – Joe Biden, a fixture in U.S. politics for a half century as a senator and vice president, is seeking to complete a long climb to the political mountaintop that includes two previous failed presidential bids by defeating President Donald Trump on Tuesday.

FILE PHOTO: Democratic U.S. presidential nominee and former Vice President Joe Biden during an appearance in Wilmington, Delaware, U.S., September 4, 2020. REUTERS/Kevin Lamarque

If Biden beats the Republican president, a fellow septuagenarian, the 77-year-old Democrat from Delaware would become the oldest person ever elected to the White House.

Biden has sought to portray his political experience as a benefit, casting himself as a tested leader up to the tasks of healing a nation battered by the coronavirus pandemic and providing steadiness after the turbulence of Trump’s presidency.

Accepting the Democratic presidential nomination in August, Biden stressed compassion and decency, seeking to draw a contrast with the pugnacious Trump.

“I’ll be an ally of the light,” Biden said, “not the darkness.”

Trump has derided him as “Sleepy Joe” and said his mental capacity was “shot” as the president’s allies sought to portray Biden as senile.

If elected, Biden would be 78 years old upon inauguration on Jan. 20. Trump, 74, was the oldest person to assume the presidency when he was sworn in at age 70 in 2017.

Biden unsuccessfully sought the Democratic presidential nomination in 1988 and 2008 before finally securing his party’s blessing this year with strong support among Black voters.

He brings to his political career a mix of blue-collar credentials, foreign policy experience and a compelling life story marked by family tragedy – the loss of his first wife and a daughter in a car crash, and a son to cancer.

Biden arrived in Washington as a young upstart. He was elected in 1972 at age 29 to the U.S. Senate from Delaware and remained there for 36 years before serving from 2009 to 2017 as vice president under Barack Obama, the country’s first Black president.

Trump has sought to turn Biden’s experience into a liability, denouncing him as a career politician. Trump has said Biden would become a puppet of the Democratic Party’s “radical left.”

The coronavirus pandemic has been front and center in the presidential race. Biden accuses Trump of surrendering in the face of the public health crisis, saying the president panicked and tried to wish away the virus rather than do the hard work needed to get it under control, leaving the economy in shambles and millions of people jobless.

Trump, who was hospitalized for three days after contracting COVID-19, has mocked Biden for regularly wearing a face mask to guard against the pathogen’s spread.

‘THE SOUL OF THIS NATION’

After serving as vice president, Biden opted not to run for president in 2016, only to watch Trump defeat Democrat Hillary Clinton. When Biden announced his 2020 candidacy in April 2019, he took aim at Trump.

“We are in the battle for the soul of this nation,” Biden said, adding that if re-elected Trump would “forever and fundamentally alter the character of this nation – who we are – and I cannot stand by and watch that happen.”

Biden selected Senator Kamala Harris – whose father is an immigrant from Jamaica and whose mother is an immigrant from India – as his running mate, making her the first Black woman and first person of Asian descent on a major-party U.S. ticket. At 56, Harris is a generation younger than Biden.

An effort by Trump to dig up dirt on Biden resulted in the president’s impeachment in the Democratic-controlled U.S. House of Representatives in December 2019. The two articles of impeachment – abuse of power and obstruction of Congress – stemmed from Trump’s request that Ukraine investigate Biden and his son Hunter on unsubstantiated corruption allegations.

In February, the Senate, controlled by Trump’s fellow Republicans, acquitted him of the charges after refusing to call any witnesses.

U.S. intelligence agencies and the FBI director this year concluded that Russia, after interfering in the 2016 election to harm Trump’s opponent Clinton, was engaging in a campaign to denigrate Biden and boost Trump’s re-election chances while promoting discord in the United States.

Biden’s previous two presidential runs did not go well. He dropped out of the 1988 race after allegations that he had plagiarized some speech lines from British Labour Party leader Neil Kinnock. In 2008, Biden won little support and withdrew, only to be selected later as Obama’s running mate.

The folksy Biden, known for blunt talk and occasional verbal gaffes, has often referenced his working-class roots to connect with ordinary Americans. Biden also was the first Roman Catholic U.S. vice president.

Under Obama, Biden served as a troubleshooter on matters of war and foreign affairs and on domestic issues such as gun control and fiscal policy.

Obama did not always heed Biden’s advice. Obama gave the go-ahead for the 2011 raid in Pakistan that killed al Qaeda leader Osama bin Laden despite Biden’s warning that it was too risky.

Biden speaks openly about his family’s tragedies including the 1972 car crash that killed his first wife, Neilia, and their 13-month-old daughter, Naomi, weeks after his election to the Senate.

He almost abandoned his political career to care for his two young sons who survived the accident but stayed on, commuting by train from Delaware to Washington to avoid uprooting them.

In 2015, his son Joseph “Beau” Biden III, an Iraq war veteran who had served as Delaware’s attorney general, died from brain cancer at age 46. Biden’s son Hunter struggled with drug issues as an adult.

Biden himself had a health scare in 1988 when he suffered two brain aneurysms.

BLUE-COLLAR BACKGROUND

Biden was born in the blue-collar city of Scranton, Pennsylvania, the eldest of four siblings. His family later moved to Delaware. Biden overcame stuttering as a boy by reciting passages of poetry to a mirror.

He was practically a political novice – having served two years on a county board in Delaware – when in 1972 he became the fifth-youngest elected senator in U.S. history.

Despite years of partisan hostilities in Washington, Biden remained a believer in bipartisanship. During his time in the Senate, Biden was known for his close working relationships with some of his Republican colleagues. In addition, a number of disaffected Republicans, including former government officials and former lawmakers, alarmed at Trump’s presidency have endorsed Biden.

Biden also advocated for America’s role as a leader on the world stage at a time when Trump was abandoning international agreements and alienating longtime foreign allies.

One of Biden’s accomplishments as a senator was helping to secure passage in 1994 of a law called the Violence Against Women Act to protect victims of domestic crimes.

While in the Senate, Biden built up a specialty in foreign affairs and at one time headed the Foreign Relations Committee. He voted in favor of authorizing the 2003 Iraq invasion before becoming a critic of Republican President George W. Bush’s handling of the war.

Biden was criticized as chairman of the Senate Judiciary Committee in 1991 for his handling of sexual harassment accusations against Republican President George H.W. Bush’s conservative Supreme Court nominee Clarence Thomas by former aide Anita Hill. Liberals criticized him for doing too little to defend Hill’s allegations, which Thomas had denied.

The committee held explosive televised hearings prior to Thomas’s eventual Senate confirmation. Thomas accused Biden’s committee of conducting “a high-tech lynching for uppity Blacks who in any way deign to think for themselves, to do for themselves, to have different ideas.”

In May of this year, Biden denied a former Senate aide’s accusation that he had sexually assaulted her in 1993, calling the claim “not true” and saying “unequivocally it never, never happened.” The allegation was made by a California woman named Tara Reade who worked as a staff assistant in Biden’s Senate office for about 10 months.

Reade was one of eight women who in 2019 came forward to say Biden had hugged, kissed or touched them in ways that made them uncomfortable, though none accused him of sexual assault. Reade publicly accused him of the assault months later.

Reporting by Will Dunham; Editing by Howard Goller

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Neither Donald Trump nor Joe Biden deserve a honeymoon from cynicism – USA TODAY

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Presidents over the decades have tried to preach against cynicism in the citizenry, but cynicism is a natural blowback to deceit and corruption.

James Bovard
 |  Opinion columnist

“The biggest threat to our democracy is cynicism,” declared former president Barack Obama two years ago. But as we enter the final days of another demagoguery-drenched presidential campaign, it is time to give cynicism the credit it deserves. In an era of clueless voters, conniving candidates and media bias, cynicism can be one of the most effective checks and balances on political power run amok.

In modern American history, the most audacious liars have been the greatest self-proclaimed enemies of cynicism. “The only deadly sin I know is cynicism,” declared President Lyndon Johnson in a 1967 press conference on how the Vietnam War was going great. In a 1973 nationally-televised speech, President Richard Nixon declared, “I reject the cynical view that politics is inevitably, or even usually, a dirty business” prior to deluging viewers with false claims on the burgeoning Watergate scandal.

In 1994, President Clinton derided citizens who “indulge themselves in the luxury of cynicism” for betraying the American soldiers who died on D-Day in 1944. In 1997, Clinton declared that people can make America “better if we will suspend our cynicism.” This is the Peter Pan theory of public service: if only people believed government has magical powers, politicians could achieve miracles. After his impeachment, Clinton castigated “fashionable cynicism” as “self-indulgent arrogance that has no place in America.” But it wasn’t cynics’ fault that Clinton helped make presidential candor an endangered species.

Cynicism is a natural blowback to deceit 

George W. Bush exploited the revulsion against Clinton, promising America “a fresh start after a season of cynicism” when he launched his presidential campaign in 1999. In his first inaugural address, President Bush touted positive thinking about politicians as civic duty, lecturing Americans of their “calling” to make a “determined choice of trust over cynicism.” In the same 2002 State of the Union where he uncorked “the Axis of Evil” to pave the way to war with Iraq, Bush declared, “Deep in the American character, there is honor, and it is stronger than cynicism.” Bush repeatedly rebuked the cynicism of anyone who refused to cheer his invasion of Iraq

Barack Obama exploited the revulsion against Bush, proclaiming in 2007 that “my rival in this [presidential] race is not other candidates. It’s cynicism.” Six years later, President Obama exhorted college graduates to beware of the “creeping cynicism” and people who “warn that tyranny is always lurking just around the corner.” He did not seize that opportunity to how he acquired the prerogative to order drone killings of American citizens on his own decree.

Politicians denouncing cynicism are akin to used car salesmen telling customers to ignore the clunking sound from the engine during a test drive. Cynicism is blowback from decades of deceit. Most of the major political power grabs in modern history have been propelled by official falsehoods, as have all the major wars since 1950. Perpetual bipartisan chicanery explains why only 20% of Americans trust the federal government nowadays. 

Cynicism often arises because politicians judge themselves by their rhetoric while citizens judge them by their (mis)deeds. The alternative to cynicism is pretending that politicians are more honest than they sound. Are politicians, like underage delinquents, entitled to have all their prior offenses expunged? 

Memo to Trump, Biden and political pundits: Texas is not all about oil and gas anymore

Cynicism is necessary because the political playing field is often tilted in favor of servility. Politicians are almost never held personally responsible for their falsehoods, follies and fiascos. Thanks to pervasive federal secrecy and surveillance, rulers hold far more cards than citizens. People have been schooled and hectored to submit, to believe and to reflexively defer to officialdom. Scores of millions of people will unquestioningly obey no matter what Washington commands.

Cynicism is a form of political damage control. An ounce of cynicism can save a pound of repenting. Cynicism functions as a brake on political steamrollers. Timely doubts loudly expressed can stop presidents from driving a nation over a cliff or into a foreign quagmire.

Don’t intellectually disarm yourself for political aggressors

Politicians seek to banish cynicism without repenting their rascally ways. Why should citizens intellectually disarm themselves in the face of political aggressors? Why should they accept the passive obedience that was preached for centuries to the politically downtrodden? Are citizens obliged to continually cast their common sense and memories overboard as if they were seeking to placate an angry pagan god? 

The derision of cynicism goes to heart of citizens’ role in a democracy. If citizens have a duty to believe, then politicians are entitled to deceive. If citizens are obliged to trust, they become sacrificial offerings for the next political con job. A cynic is often merely someone who trusts politicians as little as politicians trust each other.

Abortion in America: Roe v. Wade ruling matters, but mostly as a symbol. It has not protected abortion rights.

Cynicism is simply a discount rate for political honesty. Even cynics should not presume that all politicians are perfidious all the time. There are decent folks in every profession. Instead, citizens should judge politicians like federal judges treat accused criminals — 97% of whom are convicted.    

Cynicism can be pro-freedom, spurring resistance rather than resignation. Stalwart citizens should be cynical when politicians concoct new pretexts to subvert freedom of speech and press, cynical when politicians conspire to violate the Constitution, cynical when politicians seek to drag America into new foreign conflicts, and cynical when politicians propose sweeping new federal programs to replace disgraced boondoggles. Most importantly, citizens should be cynical when politicians absolve themselves for all the damage they have inflicted on this nation.

Winning politicians often enjoy a honeymoon after Election Day, but neither Donald Trump nor Joe Biden deserve any honeymoon from cynicism. “Think well of your masters” will be the death of democracy. The more cynical Americans become, the less power politicians can seize. 

James Bovard, author of “Attention Deficit Democracy,” is a member of USA TODAY’s Board of Contributors. Follow him on Twitter: @JimBovard

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