Broker Check

What Will Be Our Legacy?

By: James C. Denton, CFP®, EA, Managing Partner

October 1, 2018

Before you start you need to know this article will seem to have very little to do with financial markets, investment strategy or financial planning.  It has everything to do with the future of our country, and so by extension with your financial or at least your family’s future.   So bear with me, I think it will all come together.

What is your take on the Kavanaugh hearings?  Where do you stand?  Did your opinion change this week or did it only become more firmly intrenched?  

Who’s telling the truth, him or her?  More importantly, regardless of the answer to that question, what does THE PROCESS, the entirety of THE PROCESS say about the future of the supreme court, whether Kavanaugh sits or not?  How is the next nominee, whether it’s Donald Trump or Elizabeth Warren who is the appointer, going to be received by the Senate, whether it’s a Republican or Democrat majority?

Who among us would be willing to put himself through this PROCESS?  I fear, only the most ambitious.  Why?  Because few of us have so pure a personal history that we are confident that nothing anyone could say of us would reveal something in that history that we wouldn’t want our parents, our spouse or our children to hear about or sit through an inquisition on the subject.  And regardless of that confidence, what is to keep a determined opposition from creating such an event, if not this time, why not next?  And if unbridled ambition is the most important personal characteristic of the supreme arbiters of our national culture, what does that say about us as a people?

Don’t get me wrong.  If Judge Kavanaugh did what Dr. Ford is saying he did, he has no business being an appeals court judge, forget the supreme court.  Especially after the vehemence of his denials.  Never mind the other accusers, in my judgment, it’s a binary proposition.  If Dr. Ford is telling the truth then likely they all are.  If one is lying, it’s a conspiracy. 

I fear, however, that given the passage of time, and what is already out there in the public domain, it’s exceptionally unlikely that the FBI is going to turn up anything that the press has not already developed.  Woodward and Bernstein set a standard for all succeeding generations of journalists that the FBI can exceed only with their subpoena and criminal prosecution powers.  In this case, though, there are too many people out there unfavorably disposed towards any Trump nominee, that with this much blood in the water, if there were a credible historical source, CNN, MSNBC or the New York Times would have found them by now and the FBI wouldn’t be necessary.

Conclusion?  He’s probably innocent.  IMHO.  But that doesn’t mean he’s going to be confirmed.  And after his performance before the Judiciary Committee on Friday, I’m not sure it matters at this point.  Concessions to the circumstances notwithstanding, was the person we saw on Friday someone deserving of a life-time appointment as a supreme arbiter of our laws and values?  I have my doubts. 

But here’s the take away in my opinion.  The ISSUE, for this article at least, is not whether Brett Kavanaugh should be confirmed.  The ISSUE is the PROCESS!  And not just the confirmation process, I’m referring to the entirety of our legislative processes as they currently exist.  Not the constitutionally dictated executive, legislative and judicial imperatives, but rather the way they have come to be executed by, through and in support of political imperatives.   You see, this recent course of events is illustrative of a much larger political condition which we are tolerating at our peril.  I’m going to go out on a limb here and state that I doubt there is anyone in this country who is content with our political processes as they currently exist.

Regardless of where any of us stand individually, our collective take on and reactions to this entire circus tell us something about ourselves as a society that should scare us all to death.  Why?  Because I’ll bet 90% of us went into the week with an opinion on the accusations and the accusers that was driven by our existing opinion on Judge Kavanaugh before the accusations were made.  And that opinion was predetermined by our political persuasion.  Think about it.  What do (did) you know about Kavanaugh that caused you to feel about him as you did, whether for or against?  Republicans, or independents leaning Republican, as a group, were supporters of the nominee.  Democrats, or independents so inclined, didn’t support him.  There are exceptions, I know, but I strongly suspect that an objective poll would have supported this proposition.  There is no surprise in this statement, and the next nominee will be received exactly the same way. 

And herein lies the problem.  We have become a tribal people.  Many of us object to being so classified or defined, but if not in our own psyches, certainly through our congressional representatives we are a country of conservatives and liberals.  Again, no surprise, and really no reason to expect otherwise, in fact it probably should be so.  But the problem is we have an inability collectively to collaborate in any meaningful way on any issue of substance.  Rather than finding some way to use the best from our divergent opinions to improve our society (and our economy, I am an investment advisor after all), instead we each take our respective positions to the extreme, and refuse to give an inch, ever moving farther to the extremes.

Take for example, the Affordable Care Act, otherwise known as “Obamacare”.  Everyone knows there are flaws in the law.  Everyone knows it can and should be improved.  There is even a fair amount of agreement on a lot of what needs reworking, and some agreement on appropriate fixes.  But Republicans, as a national platform imperative, are committed to “repeal and replace”.  And the Democratic Party is equally committed to blind support of the existing law as it is, flaws and all.[1]   Heaven help the individual legislator who takes a contrary position.  And who can blame either side with the other so firmly entrenched in their commitment to their own position?

So  while we may make friendships across the divide – Senators McCain and Kennedy, (this week, Flake and Coons), or Justices Scalia and Ginsburg, come to mind –  individually it’s rare, and unheard of collectively that we can see the merits in the position of the “opposition” sufficiently that we are willing to come out of our foxholes for a truce talk (the allusion to war is intentional).  And this being the case, we shouldn’t be surprised when a supreme court nominee ends up being treated so unfairly as either Merrick Garland (more on Garland later) or Brett Kavanaugh.     

The political reality in the instant case is Republicans fear they must get Kavanaugh confirmed before the elections because there is a real possibility that they will lose their majority status and if they do the Democrats will not confirm him or any other nominee that President Trump is likely to put forward.  The Democrats do not deny this likelihood, in fact it is a campaign promise for some.

How did we get to this point?  It’s been a long and winding road, but the precipitating event was the exact same position by the Republicans towards President Obama’s nomination of the afore-mentioned Merrick Garland.  I’m a member of the Republican Tribe, and I found the treatment of Judge Garland not only to be procedurally wrong bordering on reprehensible, but politically irresponsible on so many levels.  Regardless of your view on that statement, we have no reason to be surprised that within minutes of Trump’s announcement of Kavanaugh’s nomination, Senate Minority Leader Chuck Schumer stated “I will fight this nomination with every tool at my disposal and with every fiber of my being” (a paraphrase, but one with which I doubt he would quibble).

We have to put a stop to this nonsense!  And it’s not the fault of the congress.  We elected them, and we are responsible to control them!  Some how or another, as a people, as a society, we must reclaim control of our political systems.  How we are to go about this, I don’t know.  It’s not an easy fix, and it’s not going to happen in one election cycle or even three or four.

But one thing I do know:  It isn’t going to change at all, in fact, it’s only going to get worse if we don’t commit ourselves collectively to dealing with it.  Somehow or another we have to become a single Tribe.  And the starting point is at the individual level – one person at a time, but ultimately collectively, to shed our hard-core, non-compromising positions on all of the issues we face that “I’m right, by golly, and I absolutely refuse to budge one solitary inch”, and our litmus-test expectations of the representatives we choose to support and character assassination of those on the other side. 

We need to start supporting candidates for office who bring a willingness to understand and consider both sides, and try to find a workable common ground in the middle, rather than insisting on electing hard core “hard-hearted” conservatives, or conversely “bleeding-heart” liberals.  Applying such labels to reject opposition party candidates while refusing to recognize the accuracy of the opposite application for our own preferred candidate is disingenuous.  And if not irresponsible, it certainly doesn’t do any thing to fix the problem.

I’ve probably ticked some of you off, probably from both sides of the divide.  Not my intent, I assure you, but if that’s the case then at least I have been a little bit balanced.  And that balance is my intent.  Because we all are responsible and balance is the beginning of a solution.  It’s not Donald Trump’s fault, and it’s not (or was not) Barack Obama’s fault.  Both were duly and legitimately elected as President of the United States.  For all their personal flaws, and regardless of whether you agree or disagree with them politically, personally, morally, religiously, we do not make ourselves better as a society by challenging their legitimacy. 

So “what’s it all mean?”  Why such a rant, such a polemic in a website posting by a financial advisor? 

We have an exceptionally strong economy right now.  Our investments are performing well, and while as always there are those crying that “the end is near”, there is in my view no reason to expect a turn around anytime soon.  I see our economic situation as a “super cycle” with the legs and the room to run.  Politically, however, we are destroying ourselves from within.  Just like every major civilization before us.

If our political system fails, our finances will fall with it.  And there is absolutely nothing you can do investment wise to prepare yourself for whatever will fill the vacuum the collapse of our system would bring.  Some would suggest you “buy gold”.  Well, you have to store it, to protect it, to convert its utility to whatever replacement economic system develops.  And what happens when the replacement system confiscates it or taxes it away?

I’m painting a pretty bleak picture, I know.  I’m not suggesting it’s imminent.  I don’t think it will necessarily happen (I hope) in my lifetime or yours, perhaps.  But it is coming.  What will be our legacy?  Politically and therefore economically? 

Open your Old Testament to the story of King Hezekiah of Judah (II Kings 18 – 20).  Hezekiah started strong, but like most humans he had his strengths as well as his weaknesses, and like many of us his weaknesses often prevailed.  As Old Testament kings go, he was probably one of the better ones.  But in his latter days he faced some real self-imposed challenges.  In chapter 20:16-19, the prophet Isaiah told him that judgment on Judah was coming, and the future looked bleak, but there was still some time before that judgment would be executed.  Time in which he could have made an effort at reform.  Hezekiah’s take away, however, was (20:19) “’The word of the Lord which you have spoken is good.’ For he thought, ‘Is it not so, if there shall be peace and truth in my days?’”  Theologians will forever debate whether a different response by Hezekiah might have made a difference in the future direction of Judah/Israel, and indeed by extension, the world.  We’ll never know.  But what a legacy he left by his indifference and focus on his own comforts. 

What will our legacy be?  Politically and economically?

[1] Actually, I’m wrong on this.  Bernie Sanders (not really a Democrat) and more and more Democrats are signing up for universal Medicare coverage.  Obamacare on steroids.


The observations and opinions expressed in this commentary are those of the author and do not necessarily reflect the views of LPL Financial. This commentary is for general information only and is not intended to provide specific advice or recommendations for any individual. You should consult with your personal investment advisor before acting upon any information contained herein. Income Tax services provided by DFS Advisors, LLC are conducted as an outside business activity separate and distinct from our relationship with LPL. LPL does not provide tax advice or services.