The Invisible Candidate

“Are they habitual liars, or just plain stupid?”

Bill King,

Wondering why the media seem to favor Democrats“Both Camps Call Debates Pivotal for U.S. Election” declares the headline on the front page of today’s International Herald Tribune.

Next to it is the kind of photo newspapers love. It shows, a man and his 12-year-old son getting shot in the Gaza Strip. The man was wounded; the boy was killed. The photo sends a hidden message: politics is important…you better pay attention!

Politics can kill you…rob you…imprison and impoverish you. Politics can make life miserable – and does, in direct proportion to which it runs things. Show me a world saturated with politics – such as late-stage Nazi Germany or almost any-stage Soviet Russia – and I will show you a world of almost unrelieved misery.

Politics can also bore you – as the presidential debates are sure to do. Bush is a scarecrow, who desperately needs the media to give him a brain. Considered “lightweight,” he will be careful to appear serious and intelligent as well as compassionate in the debates.

As big as this challenge is, Gore has an even bigger one. Tagged as ‘wooden’ or ‘robotic’ by the sensation mongers, Gore has to appear alive…even human. Perhaps DNA evidence would be admissible; the tin man needs a heart.

If either of the candidates has any dignity or common sense left, after months on the campaign trail, these presidential debates are a good opportunity for him to unload it. Both candidates will pander to the lowest common denominator of the TV audience…and the even lower denominator of the media. The media are the kingmakers now – spinning the news subtly this way or the other in order to favor their own agenda…and nudge the indifferent voter in the direction they want.

Politics – that is, the use of force – cannot make things better. Improvement is accomplished with anti-politics… that is, the private, personal efforts of millions of people working together cooperatively. Government can order people to work. It can force them to do this and that. It can steal the money of one man and give it to another. It can interfere with the market in countless ways – all of them negative. Even a kiss – ordered at gunpoint – loses its appeal.

It is no mystery why the media favors democrats. The Democratic Party typically favors slightly more politics than their Republican adversaries. A study from the National Taxpayers Union, for example, found that Gore has proposed five times as much additional spending as his adversary.

The mass media cannot report the transactions that make the world a better place. There are too many of them: A young man tinkers in his garage and comes up with a better way to write a software program…another man takes a long lunch to visit his aging parents…a woman writes a new book or brews a pot of coffee. A corporation opens a few factories. A young girl gives her father a kiss on the cheek to send him off to work.

Instead, reporters focus on mass-events, mass hysteria, mob-thinking…and politics. Democrats promise more politics. They want more ballots and more bullets – more force and less persuasion. The news media loves it.

The Libertarian candidate for president – Harry Browne – is perplexed. He is the invisible man of the national election…never mentioned in politic company.

According to a recent letter from the Browne campaign:

* Harry Browne leads the third party pack in Georgia with 4%. Buchanan trails at 1%, and Nader isn’t even on the ballot.

* Harry Browne is tied with Ralph Nader in Illinois at 3%, and leads Buchanan by two points.

* In Colorado, Nader leads, but Browne is close behind with 3%, while Buchanan polls only 1%.

* In Kansas, Nader and Browne are tied, and Browne leads Buchanan 2 to 1.

* According to the Zogby, Rasmussen and Hotline national polls, Harry Browne is tied with Buchanan nationwide.

* And yet, a Lexis-Nexus search reveals that national media coverage of these three candidates is way out of balance. Buchanan is getting 60 times as much attention as Browne, and Nader is receiving even more coverage.

On Sunday’s “Meet the Press,” for example, the nation got to hear the views of Mr. Buchanan and the insufferable Ralph Nader. Both Bush and Gore could drop dead on election day and neither of these men would have a chance of being elected. Still, Harry Browne was excluded.

Why?

The Libertarian candidate has a problem with the press. If elected, he would reduce the size and importance of all the ruling estates – including the 4th one.

Foreign policy? What foreign policy? Browne wouldn’t have one. Would he favor the expansion of Medicare…medical vouchers…medical savings plans…or a whole new national health system? Forget it – health would be a personal matter and the government would play no role.

Imagine you were a reporter. What would you write about? You could cover campaign finance reform – the Libertarians would eliminate it as a subject of discussion. How about suits against Microsoft and other corporate giants? Forget it, the anti-trust division would be out of business.

And what would much-coveted ‘access’ to top officials in a Browne administration be worth? Not much.

And who would even want to conduct an interview with Browne? He doesn’t even want to talk about politics – he wants to talk about matters of principle. He is a wet blanket on the whole election process…a dissenter from politics whose own partisans are likely to defect at the first opportunity.

Principles are rarely seen or heard in political circles. In the middle of the 19th century, Wilhelm I of Prussia was offered the imperial crown of Germany by a parliament of his subjects. He could not take it, because he believed, as a matter of principle, that the elected representatives in parliament had no power to offer it. Only those who wore the crown themselves – other princes – could offer the imperial crown.

In a way, this is Harry’s problem, too. He is asking for the crown…but will refuse to exercise the power that comes with it. If he will not play the game of politics, why should the kingmakers in the media give him the crown?

Political reporting from,

Bill Bonner

Paris, France October 2, 2000

P.S. This is about all the election coverage you will get from me. I promise.

*** “Stocks Could Face Another Rough Week,” says the headline on today’s Reuters line. This was, of course, the same service that told us last week that stocks could expect clear sailing.

*** Alas, the seas were a little choppy last week. The Nasdaq took a loss of 105 points on Friday…which left it down 3.75% for the week.

*** The Dow suffered a drop of 173 points on Friday… bringing it down 1.75% for the week.

*** The immediate problem was earnings. Kodak, Intel…and then Apple announced disappointing earnings. But instead of taking it in stride, as the currency markets took the Danish vote against the euro, the individual stocks were pummeled.

*** Apple, for example, split two for one…the hard way. Apple shares dropped more than 50% in price – so you can buy more than two shares this morning for the same price you could have bought one on Friday morning.

*** Investors are not digital men. They are analog – reacting, over-reacting…and under-reacting with whatever mob sentiments waft their way. Is a share of Apple really worth half what it was on Friday? Was it over-valued by 100% Friday? Or is it under-valued by half today? Why the harsh reactions to a few pennies of earnings?

*** Readers may recall a small historical note: during WWI, it was in the U.S. that dissent from the war fever was most severely punished. Questioning U.S. participation in the war was made a criminal offense, whereas France and Germany were more tolerant. Why? Because, the case for participation in the war was weakest in the U.S. …Americans had less at stake. Consequently, dissent was more dangerous to the war effort.

*** Likewise, investors severely punish companies that disappoint them. They’ve bought into the fever of Big Tech investing – and cannot tolerate any evidence that it may not be such a good idea.

*** Mark Hulbert made a similar point in a recent issue. He noted that investors got angry with him when he reported on bad performance by their favorite investment guru. He was surprised that they were not delighted – since he was doing them a favor by alerting them to poor results. Finally, Hulbert concluded, “investors aren’t really open to changing their minds. They instead are looking for validation and reinforcement of the decision they’ve already made…”

*** Typically, 58% of earnings announcements are negative. This year, the figure is 64%.

*** Last week’s market action brought the Nasdaq down to a 9.75% loss for the year. The Dow is down 7.4% for the year.

*** But utilities hit a new high on Friday and are up 40% for the year!

*** Pegasus Research, reported by Barron’s, found that 273 out of 339 Internet companies surveyed were losing money and “burning cash.” Drkoop.com has moved up to number 2 on the list of companies running out of money.

*** A poll from AAII has only 7% of investors bearish. This is an all-time low…and represents a remarkable triumph for Mr. Bear. Investors are overwhelmingly confident and complacent, despite a drop in the major indexes for the last 9 months…and one of the worst single months ever for the Nasdaq in September – a loss of 12.7%…not to mention large drops in the most popular and widely held stocks.

*** You can buy a share in Yahoo for only $94. It was $250 at the beginning of the year. Amazon, our river that goes nowhere, used to cost $113 a share, now you can buy one for $39. E-bay is about half of what it was in January. And the Internet incubus, I mean incubator, CMGI, is on-sale now at just $28, a discount of 82% off its January list price of $163.

*** But heck, this is the Nasdaq Nation… People buy stocks like they buy modern art – not because they like them, or because they understand them…but because they think some other fool will come along and buy them at an even more absurd price.

*** “Apple [is] not a technology company” writes Kevin Klombies “it merely manufactures boxes, powered by computer …Apple is a low tech manufacturer with a trendy marketing gimmick that has been mistakenly given a high tech valuation… 33 times earnings? Maybe 6 times makes more sense.”

*** About a year ago “Beyond.com (selling at $1.25, down 97% from the all-time high of $42) had a $25 million TV commercial campaign showing a fictitious character, ‘Reed Woodson’ who walked, apparently naked, around his house while shopping for software on the Internet,” writes Ray Devoe. But today “The ‘Naked Man’ campaign is gone,” as are a host of other ludicrous ads produced by dot.coms with seemingly limitless ad budgets. “The president of Outpost.com,” notes Ray, “was quoted as saying ‘we could have told consumers what we sell, but we shot gerbils out of a cannon. What were we thinking?'” Indeed.

*** “Last year’s 20% revenue growth at FEMSA – a 110 year old Mexican beer company – beat all comers.” Lynn Carpenter tells me. “Bud, for example, registered a mere 4.5% growth, Coors did 8%. Moreover, FEMSA turned those sales into bottom-line profits; with a 40% income growth rate…Even a year-by-year 15% average [growth] is nothing to scoff at. But FEMSA can do twice that. It probably will.”

*** Oil fell 50 cents in Friday trading. Gold dropped $2.

*** Tomorrow, Harry Potter Greenspan and the other prestidigitators at the Fed meet. After raising interest rates 6 times in the last 18 months, they will do nothing this time – it is too close to an election.

*** The comptroller of the currency reports that problem loans in the U.S. banking system went from $50 billion in 1998 to $100 billion this year.

*** Saturday, I bought another car – one of the bug-eyed, funky 2CV “deux chevaux” that you see all over France. Actually, you see fewer and fewer of them, since they stopped making them at least 10 years ago. Today, they are only driven by very old people – or very cool people. This car has a small, air-cooled engine and a top speed of about 55 mph, downhill. And it is cheap to fix…an important feature as Sophia is learning how to drive.