As we begin to move further into election season, it is becoming increasingly clear that presidential race is becoming a choice between Corrupt and Crazy. While the mainstream media leans left and typically tries to portray the Republican candidate as mean and/or stupid no matter who it is (even Ronald Reagan was considered ‘stupid’), in this case it is looking increasingly like they have a point.

However, even before the most recent indications that Donald Trump may be mentally unbalanced, the media, the left, and even some on the right have scratched their heads wondering how someone like Donald Trump could appeal to so many people (I mean, no matter what, he is likely to get 40% of the national vote). Some of the predictable accusations center on the supposed racism of the American people, or the anger of ‘white males’ and their ‘loss of power’; accusations that reveal the accuser to be very shallow and superficial in their analysis. When someone like Donald Trump or something like the Tea Party arises, it is not because a large segment of the population has decided that their grandfathers had made a colossal error in going over to Europe and crushing Nazis in the 1940s. Rather, it is an indication that something has gone wrong in society and that there is a segment that feels that its needs are not being met. So what are the reasons that Trump is popular.

#1 Immigration:

Normally, when people are voting for a person, they want him/her to act to change (or create) certain laws to deal with a perceived problem. In this case, Trump supporters are voting for someone who promises to enforce already existing law. While certain analysts are dismissing Trumps people as ‘nativists’ (some probably are), you don’t have to be a nativist to believe that laws are meant to be enforced until changed. But the reason that that enforcement has its fans is that the burden of illegal immigration is falling on them, from long lines in the ER, to larger class sizes, to competition for jobs, to perceived consumption of “goodies” forcibly extracted from the taxpayer, there is anger that the government (of both political parties) seems indifferent or hostile to the experiences and needs of a significant segment of the population. Add to this the perception that those who looking down their noses at their fellow Americans AREN’T having to deal with the fallout of these policies, and the anger isn’t hard to understand.

#2 International Trade (Globalism):

While the benefits of international trade for an economy overall has been well documented, the fact is that it hasn’t been good for everyone. For a significant fraction of the population, they have seen their jobs (and economic security) disappear and nothing comparable has taken its place. There have been vague promises of retraining programs, but like the DMV, it doesn’t really seem to work. The fact is that both political parties have really abandoned the white working/middle class to its fate. For the last generation, the Presidents of both parties have been largely committed to free trade. Finally, the people who feel that government has forgotten about them have a (admittedly imperfect) voice.

#3 Political Correctness

Over the better part of the last 15 years, political correctness has seeped into our culture from the universities and has constrained what can be said in polite company. As the politically correct culture has become stronger, it has strangled honest debate about a whole range of problems. You can’t want immigration restrictions, or you are a racist (and might lose your job). If you think that marriage should be restricted between a man and a woman, you are a homophobe and a Nazi (as opposed to being like every human from 100 million B.C. through 1995) (and you could lose your job). If you think government should spend less, then you hate poor people. If think that people should be allowed to own firearms, then you are in favor of, and maybe tangentially responsible for, the recent spate of mass shootings. Political correctness really only cuts one way, and it is somebody telling you to shut up every time you open your mouth. If someone were to do that in real life, it would not be long before you would want to assault that person. Donald Trump is highly politically incorrect, and his fans love it. They love that he gets the politically correct crowd so angry. The angrier they get and the more Trump bugs them, the better his fans like it. The reason that many of his gaffes don’t seem to hurt him is that his fans like that he is pissing off people, even if they don’t necessarily agree with the statements. Donald Trump is a big F.U. to the politically correct establishment, and that is part of his popularity.

#4 Change You Can Believe In.

Currently, roughly 2/3’s of the country believe that we are on the wrong track. What is worse, since the economic downturn 8 long years ago, the right track/ wrong track number has rarely been positive. Obama promised “Hope and Change”, but very little has been delivered. The fact roughly half the country still feels like the country is in a recession tells us that the Obama Administration has been a failure at some level. However, the Republicans haven’t offered a vision, and in fact often seem more concerned with maintaining their power. If you are someone who believes that the government has grown too big, you have watched over the last 10 years as the government has grown under Democrat & Republican Presidents as well as under Democrat & Republican Congresses. If this is you, then you don’t really have much to lose with a Donald Trump. The existing establishments of both parties seem to have failed, and the fact that Trump scares the elite in both parties is part of his appeal.

While there are probably some other reasons Trump supporters might give, I think that that these 4 are the primary reasons for a major part of his supporters. The fact that someone like Trump can make a serious run at the Presidency, far from being an argument against democracy, is a strong indication that the political system is failing. If Trump’s coalition consists largely only of racists and homophobes, why weren’t these folks able to nominate someone like Trump in 2012 and 2008 against a black man running for President? I mean, Trump’s voters (and those who will hold their noses and vote for him) didn’t suddenly become racist and homophobic over the last 4 years. The fact is that Trump’s supporters once had faith that the political system could produce the change that was needed. They won elections in 2010 and 2014, and then watched as their representatives appear to have done very little. They watched as the country still seems to stay on the wrong track. They don’t see any possibility of moving out of this rut that the country seems to be in. They don’t feel that the government cares about them or their needs (and in some cases they feel that it is in fact hostile to them).

And so they back a man who appears to have mental problems. Because while they are not crazy, he drives the political establishment nuts. They believe that he can deliver change, even if they don’t know exactly what that change might be. The fact is that they know that Corrupt will keep a bad system in place, and that they are guaranteed bad results with her. Crazy might also create a bad or worse system, or he might accidently create a better system. As difficult as it may be to imagine, there are a lot of people who don’t think that they really have much to lose by going with a roll of the dice like Donald Trump.

And that is why, despite everything, a person like Donald Trump still has a shot at being President

Over the last couple of years, people have been questioning whether the Fed is “running out of ammunition” to use when it needs to combat the next economic downturn. Over the last 60 years or so, it has been taken as an article of faith that the Fed has the power, ability, and mandate to act to “steer” the economy. If the economy is overheating, increase interest rates to slow it down. If the economy is starting to stall, lower interest rates to encourage lending and fuel economic activity. Money could be created if the economy needed a jump start, or removed to reduce inflation. It all seemed so easy and simple, and indeed has been thought to work by central banks all over the world.

However, looking back on the history of the last 20 years or so, it is worth asking whether politics has had a lot to do with Fed decision making rather than hard economic analysis. I am not suggesting that politics has been the only factor, but one would be remiss not to consider the possibility that the Fed has been trying to stabilize an economy and an economic system that simply hasn’t been working for a large swath of the country.

In the mid-1990s, the Fed under Alan Greenspan seemed ready to lower interest rates every time the stock market started to tank. Basically, the idea developed that the Fed would (and could) step in and save the day if the market got too bad. This idea, and the fact that the Fed didn’t act to stop the stock market bubble in 2000, makes it worth asking whether politics (i.e. letting the stock market crash would not have been good optics) made the Fed timid.

 As the economy started to deteriorate in 2000, in part due to the stock market bubble popping, Greenspan did act aggressively to lower interest rates and the economy eventually started to recover. But the low rates fueled a real estate bubble, and even Greenspan concedes that he left rates too low. The popping of the real estate bubble and the resulting economic are legendary. And while the economic numbers have recovered, the economy for many people really hasn’t. Meanwhile, the Fed stands there, reluctant to raise rates, and perhaps “out of ammunition” as some assert.

In taking the last 20 years in total and looking at the present instability, it almost seems like the Fed and the government in general, has been trying to manufacture some artificial prosperity because the economy hasn’t been able to provide it for a large swath of the electorate. This is not to say that there has been some secret cabal in Washington and New York that has been working nefariously behind the scenes. However, politics and maintaining the status quo (i.e. stability) is certainly a goal, and not necessarily a bad one. But the fact is that most Americans with an average household income of $50,000 are not going to be able to save enough for retirement. If you are going to need between $500,000 and $1,000,000 in liquid assets (depending on where you live in the country), you are talking about having to save 10 to 20 years of pre-tax income in order to accomplish this. You throw in taxes and kids and a house and there is simply no way this is going to happen without some help from the stock market or your house appreciating. In many ways, Fed action with the benefit of hindsight can be seen as effort to try and help the middle class to overcome the fact that wage growth and job opportunities haven’t been as plentiful as they were at an earlier time.

Today, however, the Fed really doesn’t seem to have the power to steer the economy any longer. Seven years into an economic expansion, people think that the country is on the wrong track (and have for a long time) and many people have effectively been shut out of the labor force due to being unemployed for so long. There is an expansion, but many of the people who felt the last economic expansion aren’t feeling this one. The political result of this failure is that people are willing to try anything to get an economy back that works for them. The political result is Donald Trump.