Sunday, December 19

Reader Request: Why Did Voters Change Their Preferences from 2006 to 2010? PART ONE: 2006 Elections

A reader has asked me to comment on my thoughts regarding the following phenomenon:

The fact that US voters ousted Republicans from power by voting for Democrats in the 2006 midterms, voted for “change” with Obama in 2008, and then suddenly reversed course again during the 2010 election in favor of Republicans.

Why such a great change in voter attitudes within a short period of time? Why such a rapid shift in attitudes between 2008 and 2009?

Before looking specifically at the 2006 election, let me examine one factor that contributes to voter attitudes.


I would say that one of the most potent factors influencing voter attitudes in 2006, 2008 and 2010 was the desire for change.  The American people are (logically, I'm happy to say) very unhappy with Congress.

Since at least 2006, and perhaps earlier, polls have shown very low support for Congress.  Dec 2010 figures show a record low approval rating of only 14%! The chart also shows that at the time of the elections in 2006, 2008 and 2010, approval of Congress was near then-record lows. This is consistent with the desire for change.

Why the low approval ratings of Congress? I'd argue that people realize Congress is largely a criminal entity. They realize that lobbyists have paid off many members; that Congress does not pass measures the people desire (and in fact Congress often passes measures that contradict the people's desires). One example would be immigration.  Polls consistently show that large majorities of people want legal and illegal immigration to be reduced (The study of legal immigration found that 76% want legal immigration reduced, and 58% want it reduced by 70%).  Instead, during the Bush years, Congress tried to pass legislation that would eventually legalize criminals who broke into the country and who were taking money from taxpayers!  This problem has been occurring since at least the 1980s, when Reagan provided an amnesty for the illegals!

I use the word "criminal" to describe certain politicians, not "corrupt", because "corrupt" is not strong enough.  "Corrupt" could imply that these politicians are, aside from the corrupt deals, otherwise good people.  Please. I once read a quote from someone whose name escapes me:  "I can steal a lot more money using a briefcase than I can using a gun". Many people who have risen to the highest level of government likely have, in my opinion, a long history of misuse of funds, theft, abuse of power, and abuse of others in order to "rise" to their position. They are worse than common thugs are, because it's more difficult to discover and prosecute their crimes. With political crimes it's often more difficult for a victim to even determine when they are being victimized (theft from taxpayers).

Voters may realize that both parties are corrupt, that changing the party in power may not change government's criminal tendencies.  However, the people do get some satisfaction from the fact that they are able to at least fire the criminals in power. (Unless you're one of the powerful people at the SEC, who sometimes actually want to leave government so that they can enter the lucrative private sector and be rewarded by the same criminal companies whom they failed to police).  I suspect this may have been the case when the SEC's Enforcement Director, Linda Thomsen, who was in charge when several scandals rocked the SEC the past several years, left the SEC to join Davis Polk and Wardwell.

Here's one SEC scandal:  The Inspector General of the SEC (a seemingly honest man, surprisingly) found that, regarding sales of counterfeit shares of stocks between Jan 2007 and June 2008, "of the more than 5,000 complaints received by the Division of Enforcement during that time, not one resulted in an investigation".  That's almost 14 complaints a day.  Who was in charge of enforcement?  

In July 2007, the SEC disgustingly removed the uptick rule, which was in place since just after the Great Depression.  The removal allowed criminal bankers to pile on together to short a company (bet that the stock price will go down), destroying stock prices, as they did to Bear Stearns and Lehman Brothers.  The removal of the uptick rule meant that shorters no longer had to wait until an uptick of a stock's price before they could short it.

When Bear Stearns and Lehman Brothers collapsed in 2008 (the former in March, the latter in September), there were millions of counterfeit shares of Bear Stearns and Lehman Brothers in existence.  These shares were sold by criminals intent on making the companies collapse, and the SEC did little to prevent it.

It is little known that just three days after the collapse of Lehman Brothers, the entire US and world banking system almost collapsed as $550 billion was withdrawn by panicked US citizens in only one to two hours.  It was estimated that the entire US system would have collapsed by the end of the day after a one-day withdrawal of $5.5 trillion.

Here's a second SEC scandal:  Deep Capture reported the saga surrounding an SEC Senior Investigator, Gary Aguirre.  Gary was reportedly fired by the SEC after pursuing a subpoena in order to investigate suspected criminal activity:  "The proximate cause of Aguirre’s complaint was that an insider trading investigation he had been conducting into the activities of Pequot Capital, a powerful Connecticut hedge fund, was derailed (he claimed) once the trail led towards John Mack, the influential boss of Morgan Stanley. Mr. Aguirre claimed that his SEC bosses had maneuvered to kill his investigation while warning Aguirre that Mr. Mack had too much 'juice' to pursue."

After the counterfeit shares destroyed Bear Stearns and Lehman Brothers, Morgan Stanley was one of the three largest surviving investment banks.

If you're not familiar with these major stories, blame media corruption.  But that's another story.

I want to mention one side note here. Compare the Congressional approval ratings to the average approval rating of each President throughout their terms.

Obama's approval rating average is listed as 52%, much higher than the approval of Congress during Obama's term to date (ranging from about 14% to 40%).

Clinton's average approval rating is listed as 55.1%, much higher than the approval rating of Congress during Clinton's 1993 to 2000 terms (below 40% during most of that period).

Bush's average approval rating is listed as 49.4%, which appears to be higher than the approval rating of Congress during at least six of the eight years Bush was in power.

Why do people consistently approve of the President more than they approve of Congress?  After all, isn't the President leader of his party, aren't party members in Congress, and don't all party members almost always vote the same way?

I would argue that the President's personality affects people's emotions, and hence interferes with their logic.  In contrast, Congress is a collection of personalities, and therefore has no representative personality that is as likely to create the emotions that override voter logic.  In short, some people who might dislike a President's policies might still approve of him if they like his personality.

I think that people have voted for change in 2006 and 2010 because they wanted to fire those in power. In 2008 they also thought they were getting change with Obama, change from the typical manner of criminal governance.


Why were voters unhappy in 2006?  After all, the economy was riding high, right? Well, overall it was, but I'd venture that the middle class was, relative to the upper class, shrinking, as a result of years of sales of counterfeit shares.  The counterfeit sales related to the public's investment in many non-blue chip stock companies were shifting wealth from the middle class to the upper class hedge funds.  Also, years' worth of counterfeit stock sales were illegally forcing public companies out of business and their employees out of a job.. The result was not just harm to the middle class, but gain by the larger companies who took market share away from these smaller companies.

I argue that voter anger in 2006 was largely anger at Bush.  Bush's approval rating fell below the 50% mark in an AP-Ipsos poll in December 2004 (conducted after his narrow re-election against the unpopular flip flopping John Kerry).  His poll numbers continued to decline, and averaged in the 30s during 2006, the year the Republicans were ousted from power.  People were rightfully angry about the wasteful Iraq War and the government response to Hurricane Katrina.  The middle class were rightfully angry about their weakening position relative to the upper class.  Also, many people were becoming aware of growing evidence suggesting that the government was aware of yet allowed (and perhaps assisted with) the September 11 attacks on its own people.

So, I would conclude that the dramatic shift in voter sentiment in 2006 was largely a result of the unpopularity of Bush and the desire of voters to punish Congress, since Congress had not done much to reflect the will of the people.  Was this a smart decision made by the voters?  Well, they certainly had many valid reasons to be angry with Bush.  But when you have an election, a main question should be to determine whether a change (the election of Democrats) would result in better overall conditions for the US.

Was it reasonable to believe Democrats would pull out of the Iraq War?  I'm not sure that was reasonable, although I do think it was more likely that the Democrats (versus the Republicans) would pull out, especially since the current Republican in power was the one that initiated the Iraq War, and hence may have had more motivation than others to continue with the war in an attempt to establish success.

So, were voters voting for the right reasons when they ousted the Republicans in 2006? I don't know.  Perhaps they tended to vote as they did to punish Bush rather than out of belief that Democrat policies would be more successful. 

One reason I hesitate to believe that the 2006 voters were voting for the most logical reasons is this:  There are many examples of instances when voters very much regret their choice of President and suddenly change their vote during the midterm elections.  This suggests that perhaps they didn't vote logically in the first place. The 1994 midterms were one example. The 2006 midterms were another.  And the 2010 elections were another.

In Part Two, I will examine the disturbing 2008 election of Obama in the context of voter psychology.

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