It’s All About Trump Right Now

by Greg Valliere, AGF Management Ltd.

DONALD TRUMP’S ASTONISHING CONTROL of the Republican Party has emerged as a major story in Washington this spring, from Big Tech to Liz Cheney.

WHETHER THE GOP CAN RIDE TRUMP’S COATTAILS to electoral success in 2022 and 2024 is debatable, but it appears that we’ll get a chance to find out. He’s calling the shots within the party.

THE NEAR-CERTAIN OUSTER OF CHENEY, which we predicted earlier this week, is a sign that none of the party’s top leaders have any appetite to challenge Trump. Cheney will be replaced next week by Rep. Elise Stefanik (R-N.Y.), a Trump loyalist.

THE NEXT MAJOR FIGHT will be against Big Tech, which the Republicans contend is censoring Trump. Yesterday’s ruling by a Facebook oversight board will cripple Trump’s fundraising — but this has unified the GOP against Facebook, and there may be six months of headline risk for the tech sector before the board makes a final ruling.

THE DESIRE BY REPUBLICAN LEADERS to appease the angry GOP base (80 percent support Trump) has extended to Mitch McConnell, who said yesterday that “one hundred percent of my focus” is on stopping the Biden administration from turning America into a “socialist country.” McConnell needs to ingratiate himself with the Trump base, which views him with great suspicion.

WE’VE TALKED WITH REPUBLICANS IN THE PAST WEEK who think they can regain control of the House next year (we agree). And they are more optimistic about winning the White House in 2024 — if not with Trump, then with Florida Gov. Ron DeSantis.

THERE’S ONE PROBLEM: While support for Trump within the GOP is enormous, it’s not enough to win a general election; Joe Biden won by about 7 million votes last November. And booting Cheney is hardly a prescription for winning moderate female voters.

WILL TRUMP RUN? He’s a master at teasing, allowing suspense and speculation to build, and he recently said his supporters “would be happy” with his decision. He turns 75 years old next month; Biden is 78. Our tentative guess is that neither will run.

A MAJOR POLITICAL STORY, IN OUR OPINION, is the looming brawl between Washington and Silicon Valley. Democrats want to curb Big Tech for its allegedly predatory behavior, while Republicans say the industry wants to curb free speech.

THE TOP REPUBLICAN on the Senate Commerce Committee, Roger Wicker, supports a bill that would treat social media companies as common carriers, a dramatic move that could strip them of their ability to exclude certain users from their services, according to an analysis this morning in Politico.

AND WICKER would try to kill the liability shield that protects digital platforms from lawsuits over the content of users’ posts. Democrats counter that the tech industry cannot regulate itself and perhaps needs to be broken up.

ONE THING SEEMS LIKELY: Trump will feel emboldened after Cheney’s ouster, and his fingerprints will be on everything in Washington, including a furious assault on Big Tech. Two-thirds of all Republicans think Trump won the past election, and GOP lawmakers in Washington are afraid to confront their own angry base.

The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds or investment strategies.

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This post was first published at the AGF Perspectives Blog.