Unintended Consequences

The only immutable law of the universe, political as well as physical, is the law of unintended consequences. History is replete with examples of leaders heading off in one direction only to find themselves elsewhere. It's sort of Heisenberg's uncertainty principle applied to human behavior. Once we form a plan its very existence changes the facts on which the plan, is based and sends us sideways.

Witness for example the President's decision to pursue aggressively healthcare reform in the first months of his first term. (Yes, Virginia, there will be a second term). This decision sent Congress home for the summer recess with healthcare the focus of a fierce blowback against Washington that literally roared into the town hall meetings of August. It was in the cauldron of those meetings that the inchoate anger amongst a largely exurban swath of the American public bubbled up into an organized Tea Party movement. In the most American manner imaginable, the Tea Party asserted itself, sent scores of followers to Congress in 2010 and changed Washington in an unintended and consequential manner.

In a confirmation of the immutability of this law of unintended consequences, Occupy Wall Street is now taking the Tea Party's success and challenging its supremacy. Just as the Tea Party arose from the healthcare debate, so too has Occupy arisen from the ashes of the debt ceiling debacle. It is no coincidence that OWS began as a postscript to the August spectacle of the Tea Party caucus holding the country hostage as it demanded spending cuts without revenue enhancement. We were subjected to the sad spectacle of the President's efforts at a Grand Bargain being destroyed by a minority of the Republican majority in the House. Can it be doubted that this pathetic pageantry was a tipping point for those who are now occupying Wall Street and elsewhere?

And so it goes. Plan begets changed facts that beget unintended consequences that beget a new plan that begets etc. Fasten your seat belts, America, as we see what unintended consequences Occupy Wall Street spawns.

Tea Party 1.0

United States Senate Majority Leader Harry Reid of Nevada recently told Matt Lauer in a televised interview that the Tea Party would fade from prominence and eventual existence as soon as the economic recovery reached a satisfactory level of prosperity. Whether Senator Reid was channeling early American history or not, his prediction about the modern Tea Party movement coincides correctly with the chronology of the original Tea Party in pre-revolutionary times.

The original Tea Party arose in the streets of Boston in response to a succession of British taxes. The rallying cry was, as every elementary school student of history knows, “no taxation without representation.” The Tea Party reached its apogee with the dumping of tea into Boston Harbor to avoid the British tea tax. Although recent historians have questioned the independence of the Tea Party and wondered whether Boston merchants were responsible for its organization and promotion, the Tea Party lore – and the Tea Party facts - is that these men were patriots in the vanguard of the American Revolution.

The colorful history of the Tea Party was in fact very short-lived. Once the level of hostilities between the colonies and the British spread from New England throughout the Atlantic seaboard, the leadership of the American movement steadily evolved into the hands of the men we now know as the Founding Fathers. The Tea Party itself, and its leaders, became less prominent as matters became more confederate and complicated. Without predicting the longevity of today’s Tea Party, the historical precedent from which they look for their name and their rallying cry is that of an important but short-lived movement. This may not be what the Majority Leader had in mind but it is an historical precedent for his prediction.
 

Who Are The Angry Voters?

Our firm had an all-attorney retreat in Orlando over the weekend, and the keynote speaker was national pollster John Zogby. He had a number of important insights drawn from his current work and the trends in his book The Way We'll Be.  One point in particular which he mentioned caught my attention. According to John, there's a misconception that the folks defining themselves as Tea Party supporters are primarily from the lower economic strata, particularly those who have lost their jobs. To the contrary, his research indicates that they tend to be upper middle class, and their anger stems more from a fear that whatever socio-economic level they have achieved may be taken from them.

Three stories in the New York Times today resonate against that background.  The first is a report on the US Senate race in Pennsylvania, where Pat Toomey is perceived to have an edge over Joe Sestak primarily because he has been leveraging that fear. The second is about Tea Party candidates starting to poke at the Federal Reserve Bank. It illustrates that the anger is still in search of a target but it seems to me that the harder it is to explain something, the easier it is to assign it blame. Finally, Paul Krugman has a column today that makes the case that the two previous targets, health care reform and the stimulus, don't deserve the anger they've generated because the former hasn't really taken effect and the latter was too small to matter.