“Leadership” or Lack Thereof

Recently in the United States we’ve heard news that the IRS (Internal Revenue Service) is guilty of discriminating against conservative “non-profit” or not-for-profit entities.  Any group with the name “Patriot” or “Tea Party” in their name was immediately held as suspect and the IRS in essence dragged their feet in terms of granting them a non-profit status.  The reason why these groups did this?  Simple; for taxation purposes.  Liken to a religious entity, they wouldn’t be taxed.  If the group owned property in their name they would receive a tax exempt status and as anyone in the United States knows, that’s music to the ears of a conservative.

According to the media, this went on for 18 months and ended in May, 2012.  The Acting Director of the IRS, Steven Miller was asked to resign by current Secretary of the Treasury Jacob Lew.  President Obama has vowed change and is “shocked” that such discrimination has taken place.  Speaker of the House Boehner has demanded jail time for those involved.  It reminds me of actor Claude Raines in Casablanca; “I’m shocked, shocked, shocked there’s gambling going on in this nightclub.”  So it appears the President has had his “Casablanca” moment.

But I wonder what would happen if the situation were reversed?  Well, truth be told the situation was reversed.  In November, 2004 certain voting stations in Southeastern Ohio were shut down due to an impending terrorist attack.  Why Ohio and why the southeastern part of the state?  Because Ohio was a key battleground state in the presidential election of that year and the southeastern part of that state was a heavily Democratic region.  Then Ohio Secretary of State Blackwell declared Ohio for the GOP even before the votes were tallied.  By the way; Secretary Blackwell was also the head of the Republican Party in Ohio.

So once again, this President offers the GOP a “dove” in terms of an accommodation but does he really think that the GOP would be so generous?  Nothing ever became of the election issue in 2004.  No investigation, no Senate or Congressional Hearings, nothing.  John Kerry and the Democrats were quick to concede and hence the Democrats to this day are noted for being spineless.  What the Democrats still do not understand is that each time they offer the opposition an accommodation, the other side is thinking “gutless” because they wouldn’t do it.  The GOP is not known for being appeasers and that’s exactly how they view the liberals:  gutless, spineless and not willing to fight for their principles.  We have a multitude of issues in the United States that has still not been resolved.  We have a fiscal budget that is yet to be determined, a debt ceiling battle that will start in the August timeframe and an ongoing sequestration issue that will have an effect on the US economy.  Yet, what do we have coming out of DC?  More gridlock, more indecision and a blatant lack of leadership.

Instead of being ‘shocked” this “CEO” should have the fortitude to stand up to those critical of  his administration.  I think he might find that not only would that inspire more loyalty from his own people but even the opposition might respect him more.  Wall Street is treating this as if it’s a sideshow.  The economy is not reporting good economic news and yet the markets advance.  There’s no oversight from DC on issues that affect the ordinary investors or traders.  No one is steering the ship and usually when that happens the ship crashes into the shore.

About The Author

Nick Mastrandrea

Nick Mastrandrea is the author of Market Tea Leaves. Market Tea Leaves is a free, daily newsletter that discuses and teaches market correlation. Market Tea Leaves is published daily, pre-market in the United States and can be viewed at www.markettealeaves.com Feel free to visit and subscribe.

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