Why the 2024 Election Matters – Bigly

Andrew Packer, Grey Swan Investment Fraternity

Do elections even matter? That was the big question asked last Saturday in Ft. Myers, Florida, at a symposium held by the Mises Institute.

The free-market institute follows the teachings of Ludwig von Mises and Murray Rothbard, the top members of the Austrian school of economics in the 20th century.

And a group of about 75 folks, from college students to retirees, made the trek to Ft. Myers to hear what four of the Institute’s top scholars had to say.

Tom DiLorenzo reviews how government is structurally resistant to change. (Source: Mises Institute)

As for the question asked … while it may seem like an uphill battle, yes, elections can matter.

Professor Mark Thornton noted that it took decades of grassroots activism to turn marijuana legalization from a pipe dream to a reality across many states. No incumbent politician would touch it.

All the while, the only thing the prohibition of marijuana did was make it more potent, leading users to even more potent drugs such as crack cocaine.

As for structural changes in how government operates, rather than a social issue, the path is even more treacherous.

As Tom DiLorenzo noted, members of Congress have a pretty sweet gig.

They get paid travel to and from Washington, D.C. They have a paid staff that can reach out to constituents at a level that an outside candidate would need millions of dollars in funding to match. That’s a massive barrier to entry that keeps out nearly all the qualified candidates you’d want in Congress.

Once elected, not only do they make over six figures per year, and earn a massive pension and top-of-the-line healthcare, they’re essentially set for life.

Why? Because Congress has a 94% re-election rate over the past 60 years. Once you win the primary, you have a strong chance of representing your district until you decide to retire or the Grim Reaper decides for you.

In the Senate, the level is closer to 90%. Given the six-year Senate terms, that’s not so bad.

But it’s hard to argue that elections matter when voters chose the status quo overwhelmingly when given the chance.

I noted months ago that my member of Congress certainly seemed to be benefitting from the trappings of office, selling shares of a soon-to-fail bank only to conveniently buy shares of the bank that bought the failed bank’s assets for pennies on the dollar.

This kind of pedestrian corruption is commonplace. And in a light-blue county where Donald Trump came within 2% of flipping, my incumbent Congresswoman beat her opponent by over 10 points.

Why the 2024 Election Matters

Another reason why elections don’t seem to matter is this: Even if you won an upset, how much would you really be able to change?

Donald Trump’s first term is a good example of this. Trump came in treating the federal government like a business, assuming that as the new CEO, the staffers would stay onboard and remain loyal to the new CEO’s vision.

Oops!

While Trump had a few achievements, such as removing seven regulations for every new one he proposed, far in excess of the “cut two regulations for every new regulation” campaign promise in 2016, it’s hard to move in one direction when bureaucrats dig in their heels.

It’s also hard to fire the humanlike creatures, too. That’s thanks to the 1880s Pendleton Act, which “professionalized” the civil service and ended the spoils system.

Today, a government employee is set for life, and often at a salary in excess of a comparative job in the private sector. Before the 1880s, every bureaucrat served at the pleasure of the President, whoever he was, and job security was four years maximum. We also used to have a lot fewer bureaucrats.

With Donald Trump’s reelection, however, that could change — and big. The Department of Government Efficiency (DOGE), which will be run by Elon Musk and Vivek Ramaswamy, will be looking to make deep cuts in government spending.

Even if they can’t win on every issue they find, bringing the public’s attention to wasteful spending could, in the court of public opinion, lead to some small reductions in government. Over time, those small savings can add up.

Plus, Trump is looking to change the classification of thousands of government employees to at-will. That will make it easier to reduce the federal workforce, as will a hiring freeze, allowing retiring government employees to gradually shrink the size of government employment over time.

It remains to be seen if the size of government will follow suit with a shrinking of the federal workforce. But it’s a step in the right direction.

Expect the entrenched bureaucracy to go out kicking and screaming. But as with deregulation, over time, the results will be less burden on the private sector, and more economic growth.

Yes, elections can matter. If the right people pushing for the right changes end up in the right place at the right time. Time will tell if that’s the case with Trump 2.0.

Trump will likely be able to make some changes his time around that were impossible during his first term in office. The election uncertainty is over, and Trump 2.0 will be hyper-focused on economic growth. Shrinking government could just be an added bonus.

~~ Andrew Packer, Grey Swan Investment Fraternity