Trump's Victory a Fluke or a Sign?

What the election results tell us & what a successful term will look like

On May 28, 2016 the staff of the Cincinnati Zoo shot and killed a guerrilla by the name of Harambe, much to the anger of the internet. 6 months later Donald Trump defeated Hillary Clinton in the Presidential election. On November 1st, 2024 the New York State Department of Environmental Conservation barged into a private citizens home, kidnapped his beloved pet squirrel P’Nut and euthanized it. 5 days later Americans would again elect President Donald Trump. This begs the question: Does Trump actually appeal to voters or are they just sick of Democrats killing innocent animals. ¹

If you haven’t already stopped reading, that last line was a joke; my writing coach told me I needed to start with better hooks (although the P’Nut thing did happen). As a way to get it out of my head, hopefully permanently, in a departure from regularly scheduled programming, this post will be a medley of short musings on what happened in last week’s US presidential election.

I am sure you are sick of reading about the election, let this be the last thing you read about it, then we can all go back to worrying about important topics such as fall weather, creating shareholder value and how to survive the holiday season. Like with anything published from Serviceable Insights, my hope is you will learn something new/interesting, or at least find my writing enjoyable.

If I missed the mark on this post, there’s always next week.

If this week’s article does not interest you, please check out some other recent ones:

Why everybody online seems so weird

Benchmarking is Lazy

The Most Obvious Secret to Success

The Power of Confidence

Lukewarm US Presidential Election Takes

Donald Trump won the US presidential election last week making him the Presidential elect until inauguration day, January 20th when he reassumes office. There are millions of hours worth of content discussing his first term, January 6th, the indictments, his political comeback, and the campaign against President Biden and VP Harris. You can find better perspectives on all of those topics elsewhere, instead here are some interesting themes that stood out to me from the election:

1. Republicans have re-taken the Hispanic vote

With 40% of the Hispanic Vote, President Trump had the highest share from this voting group for Republicans since President George W Bush in 2004. W beat his opponent John Kerry by 35 electoral votes and the popular vote by 3 million, which was the biggest popular vote margin for a Republican this century, until 2024.

This 40% is meaningful because Presidents Reagan and H.W Bush, won the Presidencies from 1980-1988 in relative landslides, yet failed to reach this mark. McCain, Romney and Trump in 2016 & 2020 all failed to reach above 31%, Hispanics are the second largest ethnic group in the US, representing ~20% of the population.

Hispanic voters make up a much larger percentage of the population than they did when Reagan and HW Bush won and they will continue to make up an increasing percentage of voters. If Republicans can maintain or further close the gap with Democrats, they become increasingly competitive. Republicans historically outperform Democrats with White voters by a margin of 5-10%, since Whites are the biggest Demographic group, with the largest voter turnout %, Democrats need to win big with the other ethnic groups.

If the Democrats can’t win Hispanic voters by a wide margin, they suddenly become uncompetitive in swing states with large Hispanic populations, such as Florida & Arizona. How did Trump manage to do well with Hispanic voters?

2. It’s the economy AND immigration stupid!

"It's the economy, stupid." — James Carville, political strategist to Bill Clinton, 1992

There are many motivating factors that get people to vote, the highest on that list concern safety and the economy. Maslow’s hierarchy of needs dictates that physiological needs (air, water, food, shelter) and safety (financial & personal security) are the two first rungs on the ladder. Without these, you can’t focus on the rest. If people don’t feel confident they can pay their rent or safely walk the streets at night, other issues are irrelevant. This is exactly how Latinos and the American electorate feel.

For all of Trump’s flaws, he successfully convinced enough voters that he would do a better job managing the economy and getting the border under control. Border security was among Trump’s most ardent promises since he entered politics. He began his bid for the 2016 Republican nomination by promising to build a wall between the US and Mexico, while at the same time referring to illegal immigrants coming from Mexico as bad hombres, r@pists and murderers (and some fine people).

Who would have thought 8 years later, 40% of Hispanic voters would choose him? Stats can be a bit murky when it comes to this topic but according to the government, the number of border apprehensions, which is a proxy for the volume of illegal immigrants, have effectively doubled since President Biden took office.

(chart is from New York Times, sourcing US Customs and Border Protection)

In early 2021, Biden anointed VP Harris to address the root cause of illegal immigration between the US and Mexico, some dubbing her the “border Czar”. Democrats and their voters might not liked the idea of building a wall between the US and Mexico but their alternative solution, appeared to be do nothing. The economy was the most important issue for voters overall, but immigration was still high on the list, especially for people voting for Trump. If you are on the wrong side of key issues for voters, you will have a difficult time getting them to vote for you.

3. Paid media advantage didn’t matter

"We now have a political situation where billionaires are literally able to buy elections and candidates… Democracy is not about billionaires buying elections." — Bernie Sanders, 2015

For the past few years, marketing and sales executives have been lamenting the declining effectiveness of advertising on Google, Linkedin, Facebook etc. Smart companies have understood that they need to earn traffic and recognition other ways or their business won’t be viable. The Democrats had to learn this the hard way.

Despite having a big spending advantage, somewhere between 2-3 times, the Democrats failed to capitalize and pick up any of the key swing states. This is where you need to make gains to win elections. I’m certain they paid handsome fees to expensive strategists but this only added to wasted spending.

The money advantage could not overcome the fact that they had the wrong message, candidate or campaign strategy; likely a combination of all three. They found themselves in a difficult spot with voters when it came to immigration. Decades high inflation hurt their credibility when it came to the economy. These were going to be hurdles to overcome regardless of the candidate. Biden dropping out as late as he did, gave Harris a short window to win over voters. Given her high unpopularity ratings prior to getting the nomination, she was facing an uphill climb. Harris likely needed a flawless campaign to win but she didn’t have that.

What does a successful Trump Presidency look like?

Anytime a politician runs for office, they make lofty promises during their campaign but even with the best intentions, few will come to fruition. In the case of President Trump, we should not expect him to be heavily involved at a policy level. Prior to the 2016 election, former Ohio Governor John Kasich, the final candidate for the Republican nomination, claimed his team was approached to be Trump’s running mate. When making the offer they promised they’d make him the most power VP ever, that he would have two important mandates: foreign & domestic policy. Kasich asked what Trump was going to do? To which they replied: “Make America great again”².

In any case, Mike Pence joined Trump on the 2016 Republican ticket before going on to win the election. Whether you believe Kasich’s account or not, President Trump seemed to delegate many of the important policy matters to trusted advisors and/or family members. Pence was replaced by JD Vance, but some of these trusted advisors will be back for his second term. He picked up some new people along the way, such as Elon Musk and Robert Kennedy Jr. Some of these people have made many media appearances outlining what they would aim to accomplish with a Trump victory.

A lot can go wrong during President Trump’s second term in office, but if we were to take an optimistic view, based on some of his promises, what would success look like?

1. Foreign Policy

   1. A successful end to the Russia-Ukraine war

   2. Lasting cease fire between Israel & Hamas with the return of the Hostages

   3. At least temporary de-escalation of tensions across the Middle East³

   4. Avoid hot war with China

2. The Economy

   1. Inflation remains between 2-4%

   2. Meaningfully lower Government spending

   3. Minimal deficit expansion⁴

3. Domestic Policy

   1. Return the rate of illegal immigration to pre-2021 levels

   2. No meaningful escalation in racial tensions or culture wars⁵

If President Trump can achieve most of these items, it will position VP Vance or some other Republicans for another 4 years in office. If not, perhaps they will be the ones going back to the drawing board looking for a way to win in 2032. Regardless of who you voted for and where you live, you should hope that that Trump and his team can deliver on these items, as it will be better for America, and likely the world (hopefully).

I’m interested to see how the Democrats respond to this defeat. Will they do serious introspection, adjust their platform and run an open primary free of manipulation from super delegates? Or will they simply chalk up the defeat to electoral college, racism, sexism or the common myriad of excuses they make when they lose? My hope is that it will be the former. Their economic policies probably won’t change much but they will likely move closer to the center on issues like immigration. I hope they at least stop killing animals otherwise the combination of a successful second President Trump term and their own failings might hand the Republicans another election.

I hope you enjoyed today’s article. Please Subscribe or Share Some Feedback in the Comments. I rarely comment on politics, but if you want more articles like these, please let me know. If you want to see less, the feedback is also appreciated.

1. We don’t need to revisit “They’re eating the dogs”

2. This is a real story, although it’s contested by the Trump campaign team (link to CNN story).

3. This Jared Kushner interview with Lex Fridman last October suddenly becomes very relevant (link).

4. With the promised tax cuts, it’s unlikely the deficit will come down even with lower government spending

5. This one seems unlikely. Part of his agenda seems to be to go after “wokeism”.