by Greg Valliere, AGF Management Ltd.
WE HAVE PLENTY OF NON-IMPEACHMENT ISSUES to rant about this morning, so here are three things on our mind . . .
1. WHAT DOES IT SAY ABOUT THE DEMOCRATS when their most moderate candidate, Joe Biden, proposes to raise taxes by $3.2 trillion over ten years, with higher rates for corporations and individuals? Most of his challengers are proposing dramatically higher rates — a clear contrast with Donald Trump, who will introduce a tax reduction plan later this winter.
BIDEN’S $3.2 TRILLION HIKE would pay for his modest health care and environmental programs. He would not impose a wealth tax or a Wall Street transaction tax but Biden would raise the top corporate rate from 21% to 28%, hike capital gains taxes, impose a 15% corporate minimum tax and crack down on numerous tax breaks, including the sheltering of corporate income in Bermuda and Ireland. He would raise the top individual rate from 37% now back to the old top rate of 39.6%.
BIDEN’S PLAN was mocked by liberal activists, some of whom want a 70% top individual rate. Ideas like that would stall in the Senate, but investors need to watch this issue carefully because the public — even Republicans — favor higher taxes on corporations and the wealthy.
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2. THE DEMOCRATS HAVE A GENDER PROBLEM: Now that he’s a frontrunner, Pete Buttigieg is a target, and more than a few of the party’s women are speaking out. Sen. Amy Klobuchar said this week that there’s no way a 37-year-old woman, the mayor of a city with a population of about 100,000, would be given the deference that Buttigieg enjoys. Despite his age, he apparently looks like what many people think a president should look like, which angers Klobuchar and many others.
THERE’S ONLY ONE WOMAN LEFT in the top five — Elizabeth Warren, who has faded in the past three months. Sen. Kamala Harris is the clear frontrunner to be the vice presidential running mate for virtually any white male Democrat, but in private some women concede that Republican Nikki Haley, the former South Carolina governor and UN ambassador, has a better chance of becoming the first woman president, perhaps in 2024.
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3. TRUMP VS. TRUDEAU: If you criticize Donald Trump, he never forgets it, but the cardinal sin is to ridicule him, which makes him furious. So here comes Justin Trudeau, not known for having perfect judgment, mocking the thin-skinned U.S. president at the NATO summit, amusing Emmanuel Macron and other leaders.
ORDINARILY WE WOULDN’T COMMENT ON SOMETHING LIKE THIS, but Trump was so enraged that he skipped a final NATO press conference — criticizing Trudeau as “two faced” — and this does not bode well for final ratification of the NAFTA replacement treaty, which already was on thin ice. Nancy Pelosi is seeking to open up the treaty to make last-minute changes, not an encouraging sign.
TRUDEAU AND MACRON NEED ALL THE HELP THEY CAN GET: The former will introduce a legislative agenda today in Ottawa that will require great political dexterity, since Trudeau only won 32% of the vote in Canada’s election this fall. And Macron faces more street clashes as protesters rage against his retirement reforms. And now both of them are in Trump’s penalty box.
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This post was first published at the AGF Perspectives Blog.
