Invert The Duck

There is this “thing” (as in “is that a thing?” i.e. is it a trend?) about ducks appearing calm and placid but paddling furiously below the surface.

I never had the slightest idea why anyone cared about the “placid to furious paddling” ratio of a duck, but I knew it was out there – a “thing.”

Turns out it relates to leaders who appear calm on the surface but work hard underneath.

Okay, nice, but what if you are supposed to appear frenzied and chaotic like a political party nominating a president? Would it be nice to have everything running smoothly beneath the surface?

In other words, is it time for the GOP to invert the duck?

I have heard concern that the destruction of the party will be the legacy of the current leadership of the Republican National Committee. Though that might happen on their watch, it seems a fairer view that the destruction took several decades. It will not have been all their fault though that might not stop the blaming.

Imagine the Republican Party as a troubled company (ticker symbol GOP) with a tumbling stock price. Imagine being a deep value investor — a hedge fund guy even –who flourishes by turning around disasters. What might our hedge fund guy (HFG) do with the GOP today?

In the short term, the HFG should let the chaos continue above the surface. The near-term – through the election and the second consecutive quadrennial autopsy — will likely look even worse than it does today. HFG’s strategy should be to do as little harm to the core GOP assets as possible. He will need those to recover later.

What are those core GOP assets?

The first is the ballot lines in all of the states. Election laws have been written to favor the GOP and its fellow duopolist, the Democratic Party. HFG has to keep control of these. They are the bait upon which the future will be built.

There are lists of all kinds of useful things like voters and donors, and HFG should try to preserve those too. There is some know how and technical skill.

What are the liabilities?

The GOP coalition as it exists today is a liability. In an effort to cobble together enough voters, donors and zealots to vote in primaries, the GOP has created a dysfunctional coalition at odds with itself. By deferring to the zealots, the GOP has driven away a larger number of moderate voters who could help them win elections.

A second liability is the brand. Thirty-some years ago there was a company called E.F. Hutton. It was a reasonably high level though not top tier investment bank and brokerage firm. During a period of extremely high interest rates, a system of kiting checks was created to keep interest costs down. When this scandal was discovered the brand was destroyed and the most important things that had to go were the name and the brand itself. Then the assets could be sold to other firms.

The Republican brand cannot be saved. The name needs to be changed; the elephant logo has to go; and even the coveted GOP nickname and ticker symbol have to go.

Notice anything that has not been listed?

Of course: The Senate majority; the House majority; and a majority of the state governors and legislatures. These, or parts of them, might fall into both the asset and liability categories.

After the election, the hard work begins. HFG has to downsize the GOP by disposing of the constituencies that, by their presence under the big tent, keep others out.

Donors will go too and volunteers and even some elected officials, but others will replace them.

HFG will unleash the new name and brand by stating a clear set of principles that the new party espouses. Those who choose to work for those will join and those who prefer other issues will go elsewhere.

The most notable change will be the end of the primary system, as it exists today. HFG will not allow the value of his investment to be destroyed by a slalom course through a series of fringe groups as we have just witnessed. Half a dozen regional primaries with attractive voting requirements will replace it.

Lose the 2016 presidential election and win the next generation.

Placidly and calmly beneath the surface like an inverted duck, HFG will also have shorted the Democratic Party stock and achieved a second windfall.

 

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Haven Pell

At the conclusion of the Constitutional Convention of 1787, a woman asked Benjamin Franklin, “Well, Doctor, what have we got, a republic or a monarchy?” Without hesitation, Franklin replied, “A republic, if you can keep it.”

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    • I think HFG wants to increase the value of his party that he now owns. The best use of resources is to fix it rather than spending a lot on a longer odds bet that Trump will win. To say nothing of the possibility of a Trump victory reducing the future prospects for his investment.