2004 Democratic Primary

[Canadian observer]

Finally Duceppe, BQ leader, can thank Martin ...

[Filuwaúrdjan]

I would guess that it'll only have a short term impact in Quebec, the decline of seperatism isn't likely to get stopped by a funding scandal (if it was John Swinney would be the First Minister of Scotland now [shudders]), and it's hardly had an effect at all in the Atlantic provinces... but it *might* be more lasting out West... if only because of an innate mistrust (in the Praries)/paranoia (in Alberta) of all things Ottawa.

Martin will win the election regardless, but unless this blows over he could be lumbered with a minority government.

[NHPolitico]

Economy.com Survey of Business Confidence: 173.6
Global business confidence remains high.  Manufacturers and
high-tech companies are particularly upbeat.  Businesses continue to report stronger sales and firmer pricing, and most businesses are increasingly positive about their investment and hiring intentions.  Confidence is off from its late 2003 peak, however.  Asian confidence has slipped the most.  Business services, financial services and real estate firms are also less positive.  

[NHPolitico]

Reports Stir Hopes of U.S. Factory Revival
Tuesday February 17, 11:39 am ET
By Jonathan Nicholson


WASHINGTON (Reuters) - U.S. manufacturing showed signs of revival on Tuesday, as reports from the Federal Reserve and one of its regional banks showed gains in January and early February.

The Federal Reserve said its gauge of activity at American factories, mines and utilities rose a sharp 0.8 percent in January, led by a weather-related gain in utilities use. Factory output -- more than four-fifths of total production -- rose 0.3 percent, its fifth straight monthly rise.
 
In a separate report, the Federal Reserve Bank of New York said its two-year-old Empire Manufacturing Survey's business conditions index rose to a record 42.05 in early February from a revised 38.85 in January.

The two reports may help ease worries over the embattled U.S. factory sector, which has yet to recover from the 2001 recession. Manufacturers have trimmed payrolls for 42 straight months, with about 2.8 million factory jobs lost since President Bush took office in January 2001.

Financial markets started the trading day higher after the data's release. The Dow Jones industrial average was up 63.11 points at mid-morning, while the Nasdaq composite was up a by about 18 points.

COLD JANUARY

January's cold weather helped push overall industrial production up, even as manufacturing gained. Utility output climbed a hefty 5.2 percent while natural gas production increased by 7.0 percent, its biggest jump since February 2003, according to the Fed.

Still, the gain in manufacturing sped up the pace at which factories operated in January. The capacity use rate rose to 74.6 percent in January, its highest reading since August 2001.

December's overall production and capacity use figures were revised downward somewhat in Tuesday's report. Output was revised to a flat reading from the initially reported 0.1 percent advance while capacity utilization was reported at 75.6 percent, down from the original reading of 75.8 percent.

"The gains within the manufacturing sector were fairly broad-based though moderate," said Stephen Stanley, an economist with RBS Greenwich Capital Markets.

NEW YORK AREA IMPROVED

In its monthly survey of manufacturing in the state, the New York Fed said nearly all its respondents indicated they expected conditions to be the same or better in six months.

The new orders' index rose to 34.94 in February from a revised 34.82 in January. The employment index dipped almost 8 points but was still in positive territory at 16.5, according to the bank.

The New York Fed index is one of several measures compiled by the Fed's 12 regional banks that analysts watch to gauge factory activity.

[Canadian observer]

I would guess that it'll only have a short term impact in Quebec, the decline of seperatism isn't likely to get stopped by a funding scandal (if it was John Swinney would be the First Minister of Scotland now [shudders]), and it's hardly had an effect at all in the Atlantic provinces... but it *might* be more lasting out West... if only because of an innate mistrust (in the Praries)/paranoia (in Alberta) of all things Ottawa.

Martin will win the election regardless, but unless this blows over he could be lumbered with a minority government.

In Quebec, electorally, there's a difference between separatism and the tendency to vote for a separatist party.  I once told you that Quebeckers, and Canadians as well, do like split their ticket when voting, the same apply when voting for the Parti Québécois in provincial elections and then vote No in the ensuing referendum.  Others vote for the right wing Action démocratique (ADQ) and then vote for Quebec sovereignty.

The scandal will not of course cause a surge of separatism, but it has the capacity to put the Liberals back to the bottom of the barrel they were in the 80's.

Another poll was done by Ipsos-Reid, and was published today on the Globe and Mail.  Even though the poll firm may be right wing (even though, as a French Canadian, all English Canadian polling firms would look the same), this one is a little more mathematically accurate because of its sample size (n=1,055 MoE=3.1%)

From Ipsos-Reid

Federal voting intention in Canada
LPC 35%
CPC 27%
NDP 17%
BQ 11%

Regional breakdown

Atlantic

LPC 47%
CPC 32%
NDP 12%

Quebec

Bloc Québécois 45%
LPC 31%
CPC 10%
NDP 8%

Ontario

LPC 41%
CPC 26%
NDP 21%

Manitoba & Saskatchewan

NDP 34%
LPC 29%
CPC 28%

Alberta

CPC 58%
LPC 20%
NDP 8%

British Columbia

CPC 32%
LPC 27%
NDP 27%
Green Party 9%

[© tweed]

Damn it!  Why to the libs have to lose this thing?  It was ours!  Aagh!

Even in liberal old ontario we only have a 15% lead.

[Filuwaúrdjan]

What the scandal seems to have done is destroy all of Martin's cultivation of Western voters... they actually look like numbers from the '80's...

You must be logged in to read this quote.

That's true...

BTW I wouldn't worry about the CPC winning... they won't be able to win a majority and the NDP will end up propping up a minority LPC government.
That's how Trudeau got started...

[© tweed]

Doesn't the NDP take more voted away from the liberals than the conservatives?

[Filuwaúrdjan]

Not in the West...

[jravnsbo]

Testifying for the economy

By Lawrence Kudlow

President Bush's bounce from the capture In Iraq of Saddam
Hussein has faded. His State of the Union message had clear vision,
but it lacked enough rhetorical punch to deliver another bounce. And
now the president is taking political hits from all angles,
temporarily slowing the stock market advance.
Sen. John Kerry of Massachusetts, on the other hand, is getting a
large bounce from his primary victories, with Bush-bashing on the
Democratic campaign trail nearing a fever pitch. Heavy coverage by
the print and broadcast media is only fueling the charge of the anti-
Bush forces.
Missing WMDs have not helped Mr. Bush, either. Nor did his clear
but somewhat flat performance on Tim Russert's "Meet the Press." Nor
has lower-than-expected job growth — although a steady-rising
household survey, showing more self-employed and private-contract
workers, is still the dirty little secret. Big budget deficits are
also grabbing the headlines, even though they are vastly overrated in
both numerical and economic terms.
What all this says is that the stock market rally has come under
some political pressure. Mr. Bush is the pro-investor candidate, but
his fortunes have momentarily slumped. Mr. Kerry is the enemy of the
investor class, as well as the new Democratic class-warfare hero, but
his veneer has only temporarily brightened. Stocks, of course,
respond to all these factors, passing though they may be.
Time for investors to worry? Not at all. Liberal Yale economist
Ray Fair has a better idea. His economic model projecting the
presidential popular vote is strongly favoring Mr. Bush (although the
rigorously honest Mr. Fair would have it otherwise). With a 2004
growth economy near 4 percent, low inflation and a rising jobs
number, Mr. Fair's model predicts a Bush landslide with 58 percent of
the popular vote.
Alan Greenspan's incredibly upbeat testimony before Congress last
week was every bit as promising for a Bush re-election as Mr. Fair's
conclusions. Mr. Greenspan, of course, as head of the independent
central bank, is an objective economic observer. He concludes that
the health of the U.S. economy is rapidly improving.
Mr. Greenspan's good-news economic gospel included a rosy-
scenario forecast of nearly 5 percent economic growth, with inflation
just above 1 percent. Behind that forecast is a pile of positive
data:
Household and business balance sheets are in good shape.
Spectacular productivity has led to outsized business profits.
Business investment and production are rising more rapidly than
consumer spending, which still remains strong. With the supply side
of the economy so muscular, inflation is in check and interest rates
are staying low. While corporate hiring has been slow, it will soon
pick up steam, with Mr. Greenspan expecting unemployment to drop to
5.5 percent this year. And finally, the current-account deficit is
being comfortably financed by international markets, and an orderly
dollar decline may be bottoming out.
Perversely, Mr. Greenspan's benign interest-rate outlook caused
some market traders to worry that the economy is not really as strong
as publicized. The absence of major interest-rate risk may have even
lowered consumer confidence over the jobs outlook. But things are
different today. While in the past the Fed has always acted quickly
to raise rates in the wake of strong economic readings, Greenspan &
Co. will remain patient following a period of intense deflation.
Given the fact that core inflation remains less than 1 percent and
durable-goods prices continue to fall, the central bank is right to
leave interest rates alone.
During Mr. Greenspan's testimony, numerous Democrats tried to
bludgeon the Fed chairman with the usual deficit hysteria. But Mr.
Greenspan was very clear that the Bush tax cuts should remain in
place in order to grow the economy to its fullest potential. Instead
of tax increases, he argued strongly for new spending restraint —
including new budget rules to prevent overspending.
The chairman was right again: A combination of strong economic
growth and tough budget restraint — not economy-crippling tax
increases — will eliminate deficits.
With a budget-busting highway bill on the immediate horizon, this
is not the message Congress wants to hear. But Mr. Greenspan's firm
stand on budget control may embolden the president to veto the
highway bill (which will undoubtedly be laden with pork). There are
also rumors the president will recruit former-Sen. Phil Gramm of
Texas to design new spending-control laws. This would be welcome news
to conservatives. It was the Gramm-Rudman approach that held down
spending in the Reagan 1980s. And it was Mr. Gramm who almost
unilaterally defeated the single-payer universal-health-care plan of
President Clinton 10 years ago.
If Mr. Greenspan and Mr. Gramm are successful in bolstering the
administration's backbone on spending, business and investor
confidence will improve and the economy will strengthen even more.

[© tweed]

Not in the West...

In BC it's a close race, with the Conservatives ahead.
In the plains, the NDP is very popular, and in Alberta, neither party is well received.

What I see is the NDP being more popular in areas that go LPC.

[NHPolitico]

Testifying for the economy

By Lawrence Kudlow

President Bush's bounce from the capture In Iraq of Saddam
Hussein has faded. His State of the Union message had clear vision,
but it lacked enough rhetorical punch to deliver another bounce. And
now the president is taking political hits from all angles,
temporarily slowing the stock market advance.
Sen. John Kerry of Massachusetts, on the other hand, is getting a
large bounce from his primary victories, with Bush-bashing on the
Democratic campaign trail nearing a fever pitch. Heavy coverage by
the print and broadcast media is only fueling the charge of the anti-
Bush forces.
Missing WMDs have not helped Mr. Bush, either. Nor did his clear
but somewhat flat performance on Tim Russert's "Meet the Press." Nor
has lower-than-expected job growth — although a steady-rising
household survey, showing more self-employed and private-contract
workers, is still the dirty little secret. Big budget deficits are
also grabbing the headlines, even though they are vastly overrated in
both numerical and economic terms.
What all this says is that the stock market rally has come under
some political pressure. Mr. Bush is the pro-investor candidate, but
his fortunes have momentarily slumped. Mr. Kerry is the enemy of the
investor class, as well as the new Democratic class-warfare hero, but
his veneer has only temporarily brightened. Stocks, of course,
respond to all these factors, passing though they may be.
Time for investors to worry? Not at all. Liberal Yale economist
Ray Fair has a better idea. His economic model projecting the
presidential popular vote is strongly favoring Mr. Bush (although the
rigorously honest Mr. Fair would have it otherwise). With a 2004
growth economy near 4 percent, low inflation and a rising jobs
number, Mr. Fair's model predicts a Bush landslide with 58 percent of
the popular vote.
Alan Greenspan's incredibly upbeat testimony before Congress last
week was every bit as promising for a Bush re-election as Mr. Fair's
conclusions. Mr. Greenspan, of course, as head of the independent
central bank, is an objective economic observer. He concludes that
the health of the U.S. economy is rapidly improving.
Mr. Greenspan's good-news economic gospel included a rosy-
scenario forecast of nearly 5 percent economic growth, with inflation
just above 1 percent. Behind that forecast is a pile of positive
data:
Household and business balance sheets are in good shape.
Spectacular productivity has led to outsized business profits.
Business investment and production are rising more rapidly than
consumer spending, which still remains strong. With the supply side
of the economy so muscular, inflation is in check and interest rates
are staying low. While corporate hiring has been slow, it will soon
pick up steam, with Mr. Greenspan expecting unemployment to drop to
5.5 percent this year. And finally, the current-account deficit is
being comfortably financed by international markets, and an orderly
dollar decline may be bottoming out.
Perversely, Mr. Greenspan's benign interest-rate outlook caused
some market traders to worry that the economy is not really as strong
as publicized. The absence of major interest-rate risk may have even
lowered consumer confidence over the jobs outlook. But things are
different today. While in the past the Fed has always acted quickly
to raise rates in the wake of strong economic readings, Greenspan &
Co. will remain patient following a period of intense deflation.
Given the fact that core inflation remains less than 1 percent and
durable-goods prices continue to fall, the central bank is right to
leave interest rates alone.
During Mr. Greenspan's testimony, numerous Democrats tried to
bludgeon the Fed chairman with the usual deficit hysteria. But Mr.
Greenspan was very clear that the Bush tax cuts should remain in
place in order to grow the economy to its fullest potential. Instead
of tax increases, he argued strongly for new spending restraint —
including new budget rules to prevent overspending.
The chairman was right again: A combination of strong economic
growth and tough budget restraint — not economy-crippling tax
increases — will eliminate deficits.
With a budget-busting highway bill on the immediate horizon, this
is not the message Congress wants to hear. But Mr. Greenspan's firm
stand on budget control may embolden the president to veto the
highway bill (which will undoubtedly be laden with pork). There are
also rumors the president will recruit former-Sen. Phil Gramm of
Texas to design new spending-control laws. This would be welcome news
to conservatives. It was the Gramm-Rudman approach that held down
spending in the Reagan 1980s. And it was Mr. Gramm who almost
unilaterally defeated the single-payer universal-health-care plan of
President Clinton 10 years ago.
If Mr. Greenspan and Mr. Gramm are successful in bolstering the
administration's backbone on spending, business and investor
confidence will improve and the economy will strengthen even more.

I think as long as you have unemployment and budget deficits higher than what we had under Clinton, Bush's approval on the economy will be subdued.

[JNB]

 You again really like talking to yourself dont you? Before you celebrate, look at the U6 unemployment rate from the BLS, the U6 rate is basiclaly the way Europe calculates its unemployment rate, and it was the way the US tabulated its unemployment rate till the late 80s.

 http://www.bls.gov/news.release/empsit.t12.htm

 In any event, the massive injection of liquidity though the "tax cuts", the massive increases in gov spending and the record number of home re-fis in 2003 did the trick for now.

[JNB]

 Also, it you are the one who made it a contest, again, there is a difference between spouting off the numbers and understanding what is behind the numbers.  In any event, you are a immature twit, like most Neo-Cons are.

[NHPolitico]

 You again really like talking to yourself dont you? Before you celebrate, look at the U6 unemployment rate from the BLS, the U6 rate is basiclaly the way Europe calculates its unemployment rate, and it was the way the US tabulated its unemployment rate till the late 80s.

 http://www.bls.gov/news.release/empsit.t12.htm

 In any event, the massive injection of liquidity though the "tax cuts", the massive increases in gov spending and the record number of home re-fis in 2003 did the trick for now.

I'd rather they use the "real" U6 number.

[JNB]

  Sadly for me bringing up facts, I am derrided as a "gloom & doomer". The line of though that jmc advocates, saying that those economically dislocated must adapt or be left behind is very simplistic, and politically unworkable. If the GOP alienated all voters except for those who held the views of former Rep. Dick Armey, it would be a very tiny minority indeed.

  One question the Neo-Cons have to ask themselves, why is Bush behind Kerry in the polls at this point? Why despite a imporving economy?

[Swing low, sweet chariot. Comin' for to carry me home.]

One question the Neo-Cons have to ask themselves, why is Bush behind Kerry in the polls at this point? Why despite a imporving economy?

Because capital is currently cheaper than labor; therefore, companies find it easier and smarter to increase productivity by spending capital on things other than labor.

Companies are simply increasing their productivity so rapidly (which is the best measure of economic health and the ONLY "free lunch"), there is no need to hire new workers.

The problem has been forecasting when this extremely high rate of productively will slow.

So, this high rate of productivity may be bad for Bush politically, but it is certainly a blessing for the economy.

[JNB]

  To most Americans except for the top 15%, how they are doing on the job translates into how well the economy is doing from their point of view. If Bush can not turn this around, the feeling of being uneasy, then his problems will get worse by Nov.

  My own opinion is the Bush admin is lost in a echo chamber convinced the WSJ editorial pages and the Weekly Standard reflect reality.

[Swing low, sweet chariot. Comin' for to carry me home.]

My own opinion is the Bush admin is lost in a echo chamber convinced the WSJ editorial pages and the Weekly Standard reflect reality.

What is "reality"?  Is it not true corporate profits are at an all-time high?

An economy with the highest productivity in 50 years, the lowest inflation and interest rates in 40 years, and the highest corporate profits on record....is going to produce jobs.  The question of "when" depends on when the growth of productivity slows.

But that is a guessing game, and noone guessed that these levels of productity gains were sustainable this long.  

That IS the economic "reality", regardless of the political perception of the overall public.

[JNB]

 The problem is, poltical perception becomes reality. As for overall corporate profits, they still are under their 1997 peak.

  Anyways, at least as things stand now, the Bush admin has a problem, and if 50% of voters feel economically insecure on election day, none of the GDP or profits numbers will help Bush one bit.

[Swing low, sweet chariot. Comin' for to carry me home.]

As for overall corporate profits, they still are under their 1997 peak.

I don't know where you get your info from, but that is simply not the case.

[Canadian observer]

BTW I wouldn't worry about the CPC winning... they won't be able to win a majority and the NDP will end up propping up a minority LPC government.
That's how Trudeau got started...

Trudeau started with a majority government in 1968.  He got in minority after the 1972 federal election, until the writ was dropped in '74.

It's been commonly assumed in Canadian federal politics that when a governing party is in minority, the NDP becomes the power broker.  However, we're at different times.  The current Canadian federal party system is 2+2, with 2 major parties vying for government (LPC & CPC) and 2 third parties (NDP & BQ).  If the recent Ipsos poll would stand for electoral results, the BQ would surely get 45 to 55 seats.  I presently doubt the NDP would match such number in the upcoming election (Although Ed Broadbent did it in '88, I expect Layton's troops to get a minimum of 20 seats).

If the current electoral trends stand, there are chances that Liberals get in such a minority that the NDP wouldn't even have the required number of seats to prop up a Liberal government.  The LPC has currently around 175 seats in the Commons, if we substract a possible loss of 10 ridings in the West, 15 in Quebec, and 25 (minimally, because of the strength of the NDP and an expected Conservative surge at around 30%), we get 125 seats for the Liberals.  If Layton wants to ensure he be the power broker, he needs to get around 30 seats.  Otherwise Martin might have to collaborate with the BQ (enough to create another scandal... ).

According to a Globe and Mail article I read, Jack Layton already stated its terms for negotiation.

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Personally I find quite premature from him, he's giving reason for Martin to choose the BQ (the latter wouldn't be interested in PR as the current 1PTP system greatly favours the Bloc) if the latter obtain a minority government.  He'd need to be reminded that federal politics ain't the Toronto City Council.

[Canadian observer]

Looks like it gets worse for Martin...

For the first time since under the leadership of John Turner, a Liberal MP, John Bryden (Ancaster-Dundas-Flamborough-Aldershot, ON), quits the caucus.  He's rumoured to switch to the federal Conservatives.

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John Bryden had always been a troublemaker for the Liberals.  I suspect his upcoming decision on joining the CPC is based on the fact that in the last 2000 federal election, the old PPC and AC had a total number of votes higher than the LPC in his riding.  Ancaster-Dundas-Flamborough-Aldershot, ON, is among the likely catches for the Conservatives.  Looks like plain ol' opportunism to me, but that makes a break from the long standing trend of opposition MP's virant le capôt (switching) for the governing Liberals.

Le scandale des commandites, the sponsorship scandal, seems to scare away some prospective star candidates from the Liberals... We still have yet to hear from former Liberal New Brunswick Premier, Frank McKenna...

In the eyes of the Martinite, Bryden's crime might have been that he didn't support Paul Martin in the last party leadership contest, he supported John Manley.  More and more Liberal riding conventions are getting nasty and messy...

For Bryden's riding, the local Liberal association was anyway going to eject him for a pro-Martin candidate.

In Hamilton East-Stoney Creek, ON, Sheila Copps, former Minister and Deputy PM in the Chrétien administration (and tossed away in the backbench by Martin in December), is battling for her nomination against Tony Valeri, newly sworned as Minister for Transport.  She accuses Martin of barring women from Liberal nominations (needless to say that she also accuses Martin of knowing something on the sponsorship scandal) ...

In St-Maurice-Champlain, QC, Martin barred Stephen Hogue, former Chrétien's political advisor, from running for the riding's Liberal nomination.  Martin's team rationale : they want more women nominated among the LPC candidates ...

In Beauport, QC, Martin's team parachuted a pro-Martin male candidate, Dennis Dawson, former communication advisor.  Three women were previously battling for nomination ...

Stories like that keep piling by the week.  I'm shaking my head in disbelief in seeing what's going on (and wrong) with Martin.  He looked so powerful 10 days ago, now he'd look like a pale reminder of Turner.

[opebo]

  Sadly for me bringing up facts, I am derrided as a "gloom & doomer". The line of though that jmc advocates, saying that those economically dislocated must adapt or be left behind is very simplistic, and politically unworkable. If the GOP alienated all voters except for those who held the views of former Rep. Dick Armey, it would be a very tiny minority indeed.

  One question the Neo-Cons have to ask themselves, why is Bush behind Kerry in the polls at this point? Why despite a imporving economy?

Because what makes economic sense is not popular - most voters want something for nothing, in otherwords want their vote bought.  This is essentially the whole strategy and reason for the Democratic Party - buy the votes of the working class with the money of the rich.
Democracy and Capitalism are somewhat at odds.  Between the two I definitely prefer the latter.

[Swing low, sweet chariot. Comin' for to carry me home.]

JNB,

The government estimated profits topped $1 trillion at the end of the 3rd quarter for the first time, up from $771 billion one year earlier. The latest profit surge was the best in 19 years.  Companies are simply flush with cash:

“Newly revised government figures show that American businesses earned a record $1.1 trillion in the third quarter, up 25 percent from the same quarter a year earlier. More impressive still, the slice of the economic pie that went to profits -- after-tax profits as a share of gross domestic product -- reached 9.1 percent, the best performance in the 55 years the government has been tracking such numbers.”

http://www.boston.com/business/globe/articles/2004/01/11/good_corporate_times_havent_trickled_down_to_employee_paychecks?mode=PF