Voters in four US states passed historic ballot initiatives that could signal major changes in US politics. Unfortunately, most observers missed these paradigm shifts because the presidential election distracted them.
I think these ballot initiatives show major shifts in public opinion on important issues. In particular, I believe these initiatives show a growing hostility to capitalism and large corporations among the public.
In addition, I think these initiatives show ordinary want a larger and more comprehensive welfare state and strict limits on corporate power. Bizarrely, I also think these measures point to a growing totalitarianism among ordinary Americans.
Thus, the ballot initiatives show contradictory trends that point to future political conflicts. In essence, Americans want more welfare-state benefits, and more freedom. Addressing that conflict will be one of the great political challenges of the next decade.
Game-changing Ballot Initiatives you missed include:
Massachusetts Right to Repair
I think Massachusetts Question 1 represents a populist revolt against Wall Street and Silicon Valley.
Question 1 updates Massachusetts “right to repair” law to require automakers to make all the technical data about vehicles to all citizens. Hence, Tesla (TSLA) and Ford (F) will have to make their software open-sourced.
Question 1 will give vehicle owners an app that allows access to all the technical data about a vehicle, The Verge claims. Keeping that data secret allows manufacturers to limit “unauthorized third-party repairs.”
Opening up that data means your local mechanic can repair your Tesla. Currently, only Tesla Motors (TSLA) itself can repair a Model S. If Question 1 stands, anybody could get the data necessary to repair a Tesla Model Y.
I think Question 1 is a direct challenge to Tesla’s; and Apple’s (AAPL), business model of only repairing vehicles at its dealerships. Ultimately, Question 1 could give rise to an enormous new business of people modifying electric and self-driving vehicles for different uses. For example, somebody converting Teslas into self-driving taxicabs.
Hence, Question 1 seems to mandate the open-sourced business model Alphabet (GOOGL) uses for Android. To explain, Alphabet makes Android available to any manufacturer.
Question 1 could make Tesla’s data available to any automaker. Hence, Ford (F) could duplicate any Tesla algorithm or device fast. Question 1 could drive the mass adoption of electric and self-driving vehicles and disrupt the tech industry.
I predict Silicon Valley will spend a fortune to kill Question 1 in the courts or Congress. If those efforts succeed, it will trigger a popular reaction that could destroy those institutions. For example, court packing or pressure to abolish the U.S. Senate.
Pro-corporate Republicans and Democrats; such as Donald J. Trump (R-Florida) and Joe Biden (D-Delaware), could suffer at the ballot box if they oppose right-to-repair measures. To elaborate, Right to Repair is popular the Associated Press estimates Question 1 passed with 74.88% of the vote.
Colorado Paid Family Leave
Colorado Proposition 118 extended the welfare state.
Proposition 118 mandates 12 to 16 weeks of paid leave for each employee in Colorado. Proposition 118 expands the welfare state because it creates a new payroll tax to pay for the leave. Under Prop 118, the state will pay each employee on leave up to $1,100 a week.
Proposition 118 passed by 57.66% of the vote, Ballotpedia estimates Thus, nearly 60% of Coloradoans want a larger welfare state.
Moreover, almost all Colorado Democrats want a bigger welfare state. Democrat Joe Biden carried Colorado by 55.3%. Thus, the margin for Proposition 118 reflects the percentage of Coloradoans who voted for Biden.
Biden voters want a larger welfare state. That could create a conflict because Biden himself opposes welfare state expansion measures such as Medicare for All.
Importantly, almost 56% of Coloradoans voted to pay more taxes for a larger welfare state. Hence, the Welfare State and higher taxes are popular in America.
Cynics will note that Colorado is a blue state. However, a more-radical measure passed in the slightly red state of Florida.
Florida Minimum Wage Increase
Over half of Florida voters, (51.2%) supported President Donald J. Trump’s (R-Florida) reelection. However, 60.82% of Floridians; including many Trump voters supported Amendment 2.
Amendment 2 will gradually increase the Sunshine State’s minimum wage to $15 by 2026. Yet only 39.18% of Floridians opposed it. Hence I estimate around 11% of Floridians voted for both Trump and Amendment 2.
I think Amendment 2’s success points to a future conflict among Republicans. To explain, I think Florida’s Republicans will try to kill or sabotage Amendment 2, possibly with federal help.
That will create a rift with working class Trump supporters who want both the Donald and a $15 minimum wage. Smart Democrats could use that rift to split the Trump coalition.
Additionally, Amendment 2 shows how afraid Americans are of income inequality. Floridians voted for Amendment 2 because many of them depend on low-wage service-industry jobs. Those people want more money.
A smart move for President-Elect Joe Biden (D-Delaware) is to pledge that he will order the US Justice Department to support Amendment 2 and oppose any litigation against it. I don’t know if Biden is that smart, but I think Amendment 2 shows the present Republican coalition of Big Business, libertarians, and the conservative working class is unsustainable. Conflict between those groups is inevitable, and that conflict could tear the Grand Old Party apart.
California’s Uber Initiative
Strangely, one of America’s bluest states; California, rolled back the welfare state with Proposition 22.
Proposition 22 requires California’s government to classify gig economy workers as independent contractors. Essentially, Proposition 22 overturns Assembly Bill (AB) 5 a state law that defines Gig Economy workers, such as Lyft drivers, as employees.
In California, unemployment insurance covers all employees. Additionally, Obamacare requires all companies that employ over 50 people to offer health insurance to all employment. Hence, AB 22 increased Uber’s (UBER) cost of doing business in California.
California passed Proposition 22 by a margin of 58.46%. The same voters voted for Joe Biden by a margin of 64%.
I suspect the same libertarian impulses that drove the support for Proposition 22 pushed people to vote for Massachusetts Question 1. To explain, Americans want more control over their lives and their technology.
Americans want the freedom that technology promises, and they reject the conformity and rigidity of the traditional jobs economy. That trend is bad for politicians such as Joe Biden (D-Delaware) and Donald J. Trump (R-Florida) and their “good jobs” message.
Moreover, I think Americans believe government not business should provide benefits such as health insurance. That’s bad for status quo champions such as Biden.
A more frightening possibility is that many people fear the gig-economy will be the only provider of jobs. The fear is that if gig economy vanishes, there will be no jobs and many more people will end up at the homeless shelter.
I suspect many middle-class households rely on gig economy jobs to make ends meet. Unfortunately, many Democrats cannot grasp that reality. Instead, those Democrats promote the fantasy of returning to a make-believe 1950s economy of good unionized jobs.
I think Proposition 22 exposes a flaw in Democratic messaging Republicans could capitalize on. To explain, many Americans hate the traditional jobs economy, yet the Democrats’ message centers on the jobs economy. Ordinary Americans want something beyond traditional jobs, promising more traditional jobs will drive those people away.
California’s Data Privacy Law
Oddly, the same Californians who want the freedom of the gig-economy want more regulation of Silicon Valley.
Ballotpedia estimates that 56.09% of Californians voted for Proposition 24. Proposition 24 places strict limits on how companies can use a consumer’s data and personal information.
Importantly, Proposition 24 created the California Privacy Protection Agency to enforce those limits. In particular, Proposition 24 makes it illegal for companies to harvest data from consumers under 13.
In addition, it requires tech companies to have an opt-out option for sensitive personal information. That means companies will have to ask you before sharing personal information.
Cynics will complain that middle-class Californians want both data security and cheap gig-economy services. However, I think what Californians really want is to limit corporate power and behavior.
That attitude could be good for anti-corporate Republicans; such as Trump and anti-corporate Democrats, such as U.S. Senator Liz Warren (D-Massachusetts). Such an attitude will be bad for corporate Democrats; such as President-Elect Joe Biden (D-Delaware), and corporate Republicans such as U.S. Senator Mitt Romney (R-Utah).
These ballot initiatives expose the complexity of American opinion. Americans want more freedom, and an expanded welfare state. Both Democrats and Republicans need to understand this strange set of beliefs and the ballot initiatives if they want to win future elections.
Originally published at https://marketmadhouse.com on November 15, 2020.