Welcome back to my omnibus compendium of Arizona’s upcoming primary races in the style of my 2018 summaries. The primary is set to take place August 4th – early voting ballots should have been mailed out on or around July 8th.
Arizona’s a really interesting state (I may be a hair biased), since it not only is home to 2-3 swing House seats and a high-profile Senate race, but also tenuous majorities in both state houses that could – theoretically – neuter Ducey’s trifecta this fall. And counties have their races this year as well, so I’ve highlighted some of the fireworks ongoing in Maricopa.
And this is before factoring in the fact that our state is a COVID-19 hotspot, with an unpopular Republican Governor doing almost nothing to stop it.
If you’re interested about which district you live in, check https://azredistricting.org/districtlocato
. If you want to get involved with your local Democratic party, find your legislative district on the previous link (NOT CD), and then search for your LD’s name at this link
. Feel free to attend meetings, they’re a great way to get involved with candidates and like-minded individuals.
If you wish to donate to a “clean elections” candidate (mentioned in the post as “clean”), you will have to live in that candidate’s legislative district to give qualifying $5 contributions (check here if anyone needs it
in your area), but they are allowed to accept a limited amount of “seed money” from people outside of the district. The three CorpComm candidates can take $5’s statewide.
If you do not want to vote at the polls, you will need to request an early ballot using the website of your county’s recorder prior to July 4th. Example links for Maricopa
, and Pinal
. Others available if needed.
Race ratings for listed primaries will be listed as Safe/Likely/Leans/Tilt/Tossup (alternatively Solid instead of Safe if my mind blanks) and are not indicative of my own preference for that seat. I’ll denote my personal primary preferences at the end of this series, as well as the best Republican ticket for the Dems if someone here really really wants to pull a GOP ballot in the primary. I do not advise it, but since I can't stop ya, you'll get my best suggestions.
Write-in candidates have yet to file, which could give us an outside chance at getting some Libertarians on the ballot (the Greens have lost their ballot access).
If you have any questions about voting in the primary, which races are the most contested, and how to get involved with other Democrats in Arizona, feel free to PM me.
All fundraising numbers here are as of 7/18/2020 (“Q2”).
District stats are listed for the race that involved the top Democratic vote-getter in the past two midterm cycles plus the last two presidential races, taken from Daily Kos’s legislative sheet
– Clinton’16, Obama’12, Sinema’18, and Garcia’14 (not his 2018 run
). Part 1: Statewide and Congressional Races Part 2: Maricopa County Races Update 1: Congressional and County Rating Updates Part 3: Legislative Districts 1-10 ALL OPINIONS ARE MY OWN SOLELY IN MY CAPACITY AS A VOTER IN ARIZONA, AND NOT REPRESENTATIVE OF ANY ORGANIZATIONS I WORK/ED FOR OR AM/WAS A MEMBER OF. THIS POST IS IN NO WAY ENDORSED BY THE ARIZONA DEMOCRATIC PARTY OR ANY SUB-ORGANIZATION THEREOF, OR ANY FILED CANDIDATE. Alright, let’s get cracking, y’all. I’m going to try to save time and characters on the safer seats when I can, although of course I’ll expound on any fun stuff that comes up.
Legislative District 11 (McSally+9.93, Trump+13.9, Douglas+16.7, Romney+19.3)
The first district in this writeup installment is LD11, a district very close geographically and politically to LD8. Unlike LD8, however, LD11 has slowly been trending towards Democrats, instead of away from them. Encompassing the southern half of Pinal (including a large chunk of Casa Grande) and bits of Pima, LD11 could swing under the right conditions, but is probably a safe seat this year. That’s disappointing, since the incumbents in the district are pretty darn nasty.
Incumbent Senator Venden “Vince” Leach ($98K COH), a sort-of Great Value Mitch McConnell, loves to spend his time filing SB1487 complaints against various liberal towns in Arizona – basically, suing cities over their attempts to go above and beyond state law when it comes to certain issues. Leach leads the SB1487 leaderboard with 4 SB1487 suits, most recently targeting Pima County over COVID-19 safety regulations that were slightly stricter than state law. Joining the suit were his House counterparts, COVID-19 conspiracy-monger Bret Roberts ($22.4K COH) and actual goddamn Oathkeeper and Charlottesville truther Mark Finchem ($27K COH).
Facing Finchem and Roberts is the Democratic House nominee for LD11, Dr. Felipe Perez ($24.2K COH). Perez has made few waves online and I haven’t seen him even in the same tier of candidates as Girard in LD8, so he’s probably not going to supercharge this district into Dem. territory. But given the spike in public approval for the healthcare industry due to COVID, he may get lucky. On the Senate side, Leach’s opponent will be one of retired public administrator Linda Patterson ($4.7K COH, Clean) and Marine drill instructor Joanna Mendoza ($14.5K COH). Anything could happen between now and August, but Mendoza currently has a significant organizational, political (endorsements) and fiscal advantage over Patterson, and will probably be the nominee come August.
A well-run race could feasibly knock out Finchem or Roberts, but I’ve yet to see that happen. Still, it’s far out enough that I’m not going to slam the door shut on a Perez win just yet.
hunter15991 Rating: GOP primary unopposed, Safe Mendoza, Perez unopposed, Safe Leach, Safe Roberts, Likely Finchem general
Legislative District 12 (McSally+17.19, Trump+24.5, Douglas+17.84, Romney+33.35)
Really not going to focus much on this district to save space, as it’s a snoozefest. House Majority Leader Warren Petersen ($84.8K COH) is running for Senate to replace outgoing Sen. Eddie Farnsworth. Petersen faces Haitian DREAMer. former teacher, and 2018 LD-12 House nominee Lynsey Robinson ($1.4K COH). Robinson’s a great person, but lost her House race against Petersen by the 1v1 equivalent of 20 points, and shows no sign of knocking him off this time around.
Petersen’s runningmates, Rep. Travis Grantham ($39K COH) and Queen Creek Councilman Jake Hoffman ($107.7K COH) are unopposed in both the primary and general.
hunter15991 Rating: Primaries all unopposed, Safe Petersen general, GOP House unopposed
Legislative District 13 (McSally+21.59, Trump+26.96, Douglas+26.22, Romney+31.62)
Moving on to another Safe GOP district with not much activity – LD13! Stretching from the whiter Yuma neighborhoods all the way to Phoenix exurbs in Maricopa County (and the mirror image of LD4 to its south), LD13 routinely sends Republican slates to the legislature. This year, incumbents Sen. Sine Kerr ($58.5K COH), Rep. Tim Dunn ($60.4K COH), and Rep. Joanne Osborne ($15K COH) are all fighting to hold their seats.
Kerr is unopposed in both the primary and general, while Dunn and Osborne are in the opposite situation – they’ve got two elections between now and inauguration day. Democratic paralegal Mariana Sandoval ($3.1K COH, Clean) will put up little resistance for the GOP in the general, but the entrance of former Senator and former Speaker Pro Tem Steve Montenegro ($27.8K COH) could really shake up the LD13 House primary. Montenegro, a Salvadoran-American legislator who resigned his Senate seat to run for the CD-8 special election primary (he placed 3rd, ultimately losing to then-Sen. Debbie Lesko), was a rising star in the AZ-GOP before his resignation and contemporaneous sexting scandal. This Senate run could be a good way for him to get his foot back in the door, and since his election would single-handedly double the amount of non-white Republicans in the legislator, I would figure that some Arizona Republicans are excited that Montenegro is throwing his hat back into the ring.
I haven’t seen much about this primary online, but there’s vague general on GOP pages dinging Montenegro for his ties to a 2016 National Popular Vote bill in the legislature, which is a big purity sticking point for the further-right members of the Arizona GOP. That being said, the chatter is vague at best, and Montenegro has enough conservative cred (with endorsements from people like Joe Arpaio and former Rep. Trent Franks back during his special election run) that he will primarily face issues over the sexting scandal.
I’ll give Osborne and Dunn a slight advantage over their incumbency, financial well-being, and the issues in Montenegro’s closet, but this is a really tight race and Montenegro could very well end up back in the legislature this time next year.
hunter15991 Rating: Dem. unopposed, Kerr unopposed, Tilt Osborne, Tilt Dunn, All Safe GOP general
Legislative District 14 (McSally+23.83, Trump+26.24, Douglas+22.88, Romney+26.84)
This is yet another district where Democrats stand no real chance in competing this year, and haven’t in quite some time. Situated in SE Arizona, LD14 once incorporated some ancestrally Democratic mining towns in Greenlee and Graham County, but they’ve grown red enough in the past couple of decades that this district is now held by three GOP legislators.
Former House Speaker and current Sen. David Gowan ($60.9K COH) (who was previously in the news for trying to use a state vehicle to assist in a failed Congressional campaign) faces realtor Bob Karp ($12.9K COH, Clean) in the general, while House incumbents Rep. Gail “Tax porn to build the wall” Griffin” ($50.5K COH) and Rep. Becky Nutt ($47.4K COH) face retired union activist Ronnie Maestas-Condos ($686 COH, Clean) and teacher Kim Beach-Moschetti ($13K COH, Clean). All 3 races will probably be easy GOP wins.
hunter15991 Rating: Candidates unopposed in primaries, All Safe GOP general
Legislative District 15 (McSally+8.01, Trump+16.61, Douglas+11.06, Romney+25.44)
LD15, up in Northern Scottsdale and Phoenix, is one of the final frontiers of suburban expansion for Arizona Democrats, along with the Mormon suburbs of the far East Valley (LD12, 16, and 25). A very wealthy area, LD15 has routinely been a GOP stronghold – but their hold on the area has been dissipating steadily rapidly in the Trump era. In 2018, two Dem. House candidates both managed to outperform the “single-shot” performance of a 2016 candidate, and Kristin Dybvig-Pawelko ($48.6K COH, hereafter “KDP”) improved on the district’s 2016 State Senate margin by several points despite facing a significantly more difficult opponent than the 2016 Democrat.
KDP is running again this year, as a single-shot candidate for the State House. Her opponents have yet to be set in stone, as both GOP Representatives are vacating their seats to run for higher office, and there are three GOP candidates in the August primary vying for two nominations. Veteran Steve Kaiser ($13.6K COH) and State House policy adviser Justin Wilmeth ($16K COH, $5.2K self-funded) are the nominal establishment picks for both seats, and have been endorsed by a whole host of GOP legislators. However, they face stiff competition from businessman Jarret Hamstreet ($23.2K COH, $10K self-funded), who boasts endorsements from GOP power-players like the local Chamber of Commerce and the NRA, as well as tacit support from the incumbent Senator in the district Heather Carter ($101.2K COH) (somewhat of an Arizona Lisa Murkowski). I’ve been able to find very little chatter on the race, but with Hamstreet’s significant fundraising advantage I definitely think he secures one of the two nominations this November. While the district is still quite red, KDP is no spring chicken, and facing Kasier, Hamstreet, or Wilmeth will be a lot easier than her run against Carter in 2018.
If I’m going to be honest, it is the GOP Senate primary that is almost as important as the House general election. Heather Carter has gotten on the bad side of quite a few conservative legislators during her tenure in the Senate, holding up GOP budgets with her partner in crime Paul Boyer in 2019 over a stalled child sexual assault statute of limitations bill and this year over an amendment to give additional funding to firefighters for PPE and to students for tuition support.
That amendment failed 15-15 thanks to one Kate Brophy McGee - more on her later.
Carter’s actual attempts at moderation (as opposed to McGee’s performative bullshit) has inspired current State Rep. Nancy Barto ($9.9K COH) to challenge her for the Senate. Barto has the support of both Kaiser and Wilmeth (as well as most of the GOP establishment) but has been routinely lagging behind Carter in fundraising (both in terms of current COH and overall amount raised). Carter has been bringing in more “moderate” and pro-public education GOP volunteers from all over Phoenix and is sure to put up a fight in August. As it stands, I think she narrowly pulls it off. There is no Democratic Senate opponent in the general, so winning the primary automatically wins the seat.
If you’ve got GOP friends in AZ who just can’t bare phonebanking for Democratic candidates but complain about the state of the Republican party, send them her way.
Carter has beliefs. Barto has none.
hunter15991 Rating: Dem. unopposed, Tilt Carter, Lean Hamstreet, Tilt Kaiser, GOP Sen. unopposed in general, Likely Hamstreet, 2nd GOP unopposed
- CarteHamstreet: $124.4K
- KDP: $48.6K
- Barto coalition (KaiseWilmeth/Barto): $40.5K
Legislative District 16 (McSally+17.58, Trump+28.37, Douglas+17, Romney+28.11)
LD16, out on the border between Pinal and Maricopa County, is probably the reddest district in Arizona that could still be relatively considered “suburban”. The only Democratic candidate is write-in House candidate Rev. Helen Hunter ($783 COH), and while her background is stellar (incl. past work with the NAACP, Mesa PD’s Use of Force Committee, and other community involvement), there isn’t even a guarantee she’ll make it onto the November ballot.
Meanwhile, Rep. Kelly Townsend ($15.5K COH) has tired of the State House (just like she tired of her furry fursona, and is running unopposed for State Senate.
The real drama, therefore, is in the GOP State House primary to win Townsend’s old seat. Incumbent Rep. John Fillmore ($12.9K COH) is running for another term, and seems set to win one of the two nominations. Townsend’s former seat is contested by respiratory therapist Liza Godzich ($14.6K COH) (who wins the “most moderate” title by default by virtue of taking COVID kinda seriously), CorpComm policy advisor Jacqueline Parker ($16.4K COH), and school choice activist/general lunatic Forest Moriarty ($17.7K COH).
Moriarty has the valuable Townsend endorsement, but has not been able to consolidate support easily elsewhere – Parker’s CorpComm ties let her bring quite a few assets of her own to bear, as well as endorsements from Congressman Andy Biggs and the NRA.
This election will be a test of Townsend’s downballot coattails, as well as those of the school choice movement in AZ parlaying any support they may have into legislative results. Success for Moriarty here could go as far as inspiring Townsend to run for Governor. We’ll see if it comes to that.
hunter15991 Rating: No Dem. filed (pending write-in), Townsend unopposed, Lean Fillmore, Tossup ParkeMoriarty, GOP unopposed in general
Legislative District 17 (Sinema+3.53, Trump+4.09, Douglas+3.12, Romney+14.16)
One of the reasons I significantly delayed writing these writeups was because I was dreading writing about LD17. Not to doxx myself completely, but in 2018 I had far too many negative encounters with the incumbent Democratic Representative, Jennifer Pawlik ($101.3K COH) that made me routinely question my support of her. I’m still trying to heal the wounds in multiple relationships I have with friends that were caused by Pawlik’s actions.
I deeply regret ever lifting a finger to help her when I had opportunities in other districts. But because her actions never got physical, because the stakes are so high this year, and because too much unsubstantiated negative talk about a candidate can get a post deleted - I don’t wish to publicly expound on her actions (nor put words in the mouth of other people who interacted with her). Feel free to PM if interested.
Pawlik as a candidate is a grab-bag. On paper she’d be a strong option for a suburban district – a teacher and education funding activist with a prior win during the 2018 wave. However, behind the scenes she is quite a poor campaigner in ways that directly impact Democratic candidates’ odds and presences in the district, including her own - which makes me more apprehensive of her odds of re-election than her fellow Jennifer in HD18 (Rep. Jennifer Jermaine), who’s quite similar to Pawlik on the whole.
Pawlik’s Senate runningmate this year is local businessman and first-generation American Ajlan “AJ” Kurdoglu ($51.5K COH). AJ’s a good guy and more serious of a campaigner than Pawlik, and is on well enough terms with her that no inter-candidate drama will probably happen this fall (which would be a welcome change for the district). He’s been slightly outpacing her in fundraising and seems to be hitting the ground running.
The Republican incumbents in this district are Sen. JD Mesnard ($102.6K COH), who moonlights as legal counsel for an organization categorized as a hate group by the SPLC, and Jeff Wenninger ($117.8K COH), a backbench Bitcoin bro. Wenninger and Mesnard have both been in their seats for a while, and this cycle were backing Chandler Vice Mayor (and JD Mesnard’s mom) Nora Ellen for the other State House seat – Ellen lost to Pawlik in 2018.
But in a stroke of luck for Pawlik, Ellen failed to qualify for the ballot this year. However, in a similar stroke of luck for the GOP Liz Harris ($27.3K COH, $21.3K self-funded) - a local realtor (like Ellen) - did qualify. I’ve yet to discern just how close she is with Mesnard and Wenninger, and how much cash she is willing to dump into this race, but in terms of how random non-GOP establishment candidates the LD17 Republicans could have done far worse than Harris.
All the pieces in this district would point to a shift even further left than it was in 2018, and had I not known what I know about Pawlik this would be a Tilt D House/Tossup Senate. But I don’t know if she’s changed since 2018 - and if she hasn’t, there is no guarantee that she won’t snatch defeat from the jaws of victory.
hunter15991 Rating: Primaries uncontested, Tilt Mesnard, Tossup House (Pawlik/Harris), Safe Wenninger
Legislative District 18 (Sinema+18.58, Clinton+10.39, Garcia+12.5, Romney+1.93)
Like LD10 in the previous part of my writeup, the situation in LD18 is another blast of the proverbial Gjallarhorn for the AZ-GOP’s suburban chances. Once a very competitive district (fully red as recently as 2016), LD18 is now held by 3 Democrats – Sen. Sean Bowie ($106.3K COH), Rep. Jennifer Jermaine ($65.7K COH), and Rep. Mitzi Epstein ($60.8K COH). Bowie and Epstein have carved rather moderate paths in their respective houses having been elected back when this district was more competitive, while Jermaine’s tacked a bit more to the left, and has been a prominent voice for increasing education funding (prior to running for the State House she was a public school funding activist and IIRC Moms Demand Action member) and for missing indigenous women (Jermaine is part indigenous herself).
The GOP’s troubles in this district started around the filing deadline, when one of their candidates, Alyssa Shearer, withdrew from the primary. Super anti-abortion nut Don Hawker ($619 COH) filed as a write-in candidate to replace her, but it’s uncertain if he’ll qualify for the general election. Their other House candidate, Bob Robson ($11K COH) is on paper a solid candidate (being a former Speaker Pro Tem of the state house), but lost by the equivalent of 6% to Epstein in 2016 and by 19% when he ran for Kyrene Justice of the Peace (a district that roughly matches the boundaries of LD18. Robson’s an old warhorse) - going 0 for 2 since 2014. It’s a sign of the times that he and discount Scott Roeder are the two potential House candidates for the GOP in this district.
In the Senate, the GOP doesn’t fare much better. Real estate agent Suzanne Sharer ($4.2K COH) is trying to run a semblance of a decent race against Sen. Bowie, but keeps using her campaign Twitter (@blondeandsmart – I promise you that’s a real handle) to retweet QAnon shit. Sharer is going nowhere in November. That’s if she makes it to November, given her past retweets advocating for people to drink bleach to cure COVID.
hunter15991 Rating: Primaries uncontested, All Safe Dem. general
Legislative District 19 (Sinema+44.97, Clinton+40.25, Garcia+32.38, Obama+34.3)
LD19 is a safe Democratic district in the West Valley, where all the drama is happening in the primary. Rep. Lorenzo Sierra ($9.3K COH) and Rep. Diego Espinoza ($25.2K COH) are both running for re-election, defending their seats against challenger Leezah Sun ($5.1K COH), a local activist. Sierra and Espinoza haven’t been particularly conservative in their voting records in the legislator, but have taken some flack from the more progressive wing of the party lately for outside corporate expenditures in this primary. I’m honestly unsure why these PACs are weighing in given that Sun isn’t running all that good of a campaign, but I guess better spend it here than in tighter primaries. Assistant State Minority Leader Lupe Contreras ($7.2K COH) is unopposed in his primary.
In the general, there’s one GOP candidate for both House and Senate, but both are write-ins and could possibly not qualify for the ballot. For now, Democrats are unopposed in this district in the general.
hunter15991 Contreras uncontested, Safe Sierra, Safe Espinoza, Uncontested Dem. general
Legislative District 20 (Sinema+3.7, Trump+8.01, Douglas+0.04, Romney+12.87)
LD20 is another suburban district where Democrats could see sizable gains this fall. Won by Sinema and Maricopa County Recorder Adrian Fontes, and almost snagged by David Garcia during the 2014 Superintendent race, LD20 has been on the Arizona Democratic Party’s mind for a few cycles now. Their candidates this year are strong – 2018 Senate nominee Doug Ervin ($94.6K COH) has filed for a rematch after losing by 4 in 2018 (where an independent ex-GOP candidate took 7% - Ervin claims Quelland actually hurt him more than district Republicans), and retired teacher Judy Schweibert ($158.2K COH) is running for House. Both are running bang-up campaigns and seem set to make November a problem for local Republicans, and Ervin has eschewed the public funding he took last time in order to be able to fundraise better for the slugfest ahead.
The local GOP, however, isn’t taking this lying down. Representatives Shawnna Bolick ($161.8K COH) - who was almost bumped off the ballot for using a PO Box as her filing address - and Anthony Kern ($73.4K COH) - an ex-cop on the Brady “untrustworthy cop” list - have been building their warchests in preparation for this cycle after narrowly hanging on in 2018 (despite both Democrats in that race running with public funding). While Bolick has typically stayed out of especially heinous controversy on social media (despite once posting that all masks come from Wuhan and are thus contaminated with COVID), Kern’s time on the force seems to have stuck with him, and his Twitter feed is full of a lot of pro-cop posts and whatnot. With Schweibert running as a single-shot candidate this year I can see Kern’s tendency of accidentally discharging his foot into his mouth finally coming back to bite him.
On the Senate side the past election results are slightly more promising than the House, but the opponent is tougher as well. Sen. Paul Boyer ($50.5K COH) is probably the closest there is to a living John McCain in the Arizona Legislature (not to deify him too much – he’s still conservative), having blocked two GOP budgets in the past two years along with Sen. Heather Carter (see LD15). In 2019 this was over a child sexual assault reform bill (extending the statute of limitations), and in 2020 this was over a lack of funding to firefighters and university students in the emergency “skinny” COVID budget the legislature passed in the spring. His attempts at moderation are visible outside of that: Boyer’s abysmal Q2 fundraising – per his own words – came from not fundraising at all during the 5 month long legislative session despite campaign finance rules only banning lobbyist contributions during the session (and I guess that’s commendable self-policing), and on his website he stops just short of calling for abortion to be banned, which makes him Margaret fucking Sanger among the current AZ-GOP.
That’s not to say that people shouldn’t support Ervin with all it takes – hell, if anything he’ll need more help to oust Boyer. Ultimately I think Ervin holds a narrow lead in this race with the absence of Quelland and with far better fundraising than what the LD20 slate had last year, but the election is still quite far away. If I had to pick one Democrat to win in this district, it’d be Schweibert.
hunter15991 Rating: Primaries uncontested, Tilt Ervin, Tilt Schweibert, 2nd House uncontested
Authored by Dog Kass via RealInvestmentAdvice.com, White House Politics: submitted by
(When asked what he wanted to give thanks for during a press gaggle Thanksgiving Thursday, Trump responded), “_for having a great family and for having made a tremendous difference in this country. I’ve made a tremendous difference in the country. This country is so much stronger now than it was when I took office that you wouldn’t believe it… And I mean, you see, but so much stronger people can’t even believe it. When I see foreign leaders they say we cannot believe the difference in strength between the United States now and the United States two years ago.” _– President Trump (Comments on Thanksgiving
_“You only think I guessed wrong! … You fool! You fell victim to one of the classic blunders – the most famous of which is “never get involved in a land war in Asia” – but only slightly less well-known is this: Never go in against a Sicilian when death is on the line!” _– Vizzini,The Princess Bride The Economy: “The missing step in the standard Keynesian theory (is) the explicit consideration of capitalist finance within a cyclical and speculative context… finance sets the pace for the economy. As recovery approaches full employment… soothsayers will proclaim that the business cycle has been banished (and) debts can be taken on. But in truth neither the boom nor the debt deflation… and certainly not a recovery can go on forever. Each state nurtures forces that lead to its own destruction.”
_–_ Hyman Minsky The Markets: “Every new beginning comes from some other beginning’s end.”
_Seneca the Elder
Contrary to the expectations of many (including myself), the uncertainties following the surprising Trump presidential election victory, which produced a number of possible outcomes (some of them adverse), was enthusiastically embraced by investors in 2017 and in the first month of this year. A market on steroids was not a conclusion or forecast by any mainstream Wall Street forecaster that year. There was no sell side strategist who expected equities would rise anywhere near the 20%+ gains in the major indices recorded in 2017, nor do I know any who predicted that the S&P Index would make more than 70 individual highs a year ago.
As I expected, that enthusiasm continued in and through most of the month of January, 2018. But, after a year of historically low volatility and ever-rising stock prices, the bullish consensus became troubled as the complexion of the market changed throughout most of 2018 .
As I noted in last year’s commentary, I thought that the biggest surprise in 2018 would be that extrapolation of the market uptrend didn’t work after many years of working, and that we will witness the emergence of multiple non-consensus developments, including:
- A dramatic drop in the price of bitcoin (to under $2,000)- A devastating decline in many bitcoin collateral plays- A much higher oil price- A slowing (not expanding) rate of economic domestic growth as the tax bill “trickles up,” not down- A mean reversion higher in volatility- The bursting of the global short volatility bubble which serves up a 20% drop in equities (aided by both weaker earnings results and lower valuations).- And, of course, I anticipated that there would be an abundance of surprises in the fertile political arena with the incalculable Orange Swan at the helm in Washington, D.C., and in his role as the “Supreme Tweeter.”“Expect the unexpected and, whenever possible, be the unexpected.” – _Kurt Vonnegut, Breakfast of Champions_As we enter 2019, the scent of_ “Group Stink_” is still thick despite a heady list of multiplying uncertainties. Nevertheless, while the _Bull Market in Complacency_ has been pierced in October, 2018, most market forecasts remain optimistic.
Warren Buffett once observed that a bull market_ “is like sex. It feels best just before it ends.'” _While some of us in the ursine crowd debate whether the investment orgasm has already passed, in the extreme it finally may be Minsky’s Moment
and year after nine years of recovery and prosperity following _The Great Recession._This year I have decided to publish my _“Surprise List”_ a bit earlier than usual.
As you all know, my Surprises are what I term to be _Probable Improbables_ – events that have a greater possibility of occurring than are seen by the consensus. I try to make you think apart from that diabolically dangerous_ “Group Stink”_ and, particularly as it relates to politics (but with other subjects as well), I feel that I should offend you at least once, or I am not doing my job. But, any offense is meant in the spirit of the great Romantic poet William Blake who taught us that “_Opposition is true friendship._”
My Surprises are shorter in length than in previous years. _(I want to quickly get to the important points of the Surprise List – available on one or two pages – rather than deliver a more flowery prose and bunch of stories that I have commonly done in the past)._We will start the new investment year about one month from now with a completely different _“feeling”_ of previous years – as I mentioned previously, the complexion of Mr. Market seems to have changed:
- Investors (retail and institutional), previously comfortable being among the herd of optimism, are beginning to panic.- The dominant investors of the decade – Exchange Traded Funds and Quantitative Strategies and Products (e.g. risk parity) – are selling into weakness (just as they bought into strength) – serving to overwhelm active investors.- Hedge funds are completing another unfavorable year in which their investment performance is poor. Against a backdrop of a high fee structure (at a time in which passive management fees are “moving to zero” ) – redemptions are growing and even some of the most competent managers are hanging up their spikes and closing down.- Public companies, in some measure to increase the value of their stock options) who have gone on a massive buying streak of their own securities (propping up stocks and nominal EPS at the expense of building their businesses and improving productivity) may begin to get second thoughts as stocks founder and interest rates have risen.- The two “shiny objects” crypto currency and FANG – revered and hyped by the many – is likely having a more profound impact on the herd’s newly found negative sentiment than many realize.- Global economic growth prospects continue to grow more ambiguous – with the schmeissing of the price of crude oil another warning and conspicuous signpost of a broadening slowdown.- The Federal Reserve has made a profoundly important change from easing to restraint._“In ambiguous situations, it’s a good bet that the crowd will generally stick together — and be wrong.” _– Doug Sherman and William Hendricks
The core themes and roadmap for 2019 is that a standard run-of-the-mill Bear Market may run into something bigger in a year enveloped in unprecedented political turmoil (and electorate disgust and anger), an escalating trade (and cold) war with China and continuing global economic disappointments — dragging down a mature, an extended and fully exploited economic growth and market cycle.
Not surprisingly, my Surprise is that a slightly down year of performance for the S&P Index in 2018 may turn out to be something worse in 2019.
But the biggest and most provocative surprise is the decline and fall of President Trump in 2019 – in which an anti-imperial rebalancing is successfully mounted by a more assertive Congress, bringing the country back into constitutional equilibrium.
Without further fuss, here are my outside of consensus 15 Surprises for 2019
: 1) A U.S. Recession in 2019 Followed by Stagflation:
We learn, in 2019, the extent to which economic activity was pulled forward by the protracted period of historically low interest rates – as capital spending, retail sales, housing and autos founder further.
With U.S. Real GDP growth dropping to +1% to +2% in the first half of 2019, inflation remaining stubbornly high (especially of a wage-kind as the labor market remains tight) and with cost pressures unable to be passed on, the threat of recession intensifies.
By the third quarter of 2019 U.S. Real GDP turns negative. Tax collections collapse as government spending continues to rise. The budget deficit forecasts are lifted to over $2 trillion.
The U.S. falls into a recession in the last half of 2019 – followed by a lengthy period of stagnating economic growth and higher inflation (stagflation).
A dysfunctional, non-unified and discombobulated Europe also falls into a recession in 2019 – with significant ramifications for U.S. multinationals that populate the S&P Index.
U.S./Chinese trade tensions push the global economy down the hill as the year progresses and GDP growth in China comes in below +5.0%. The IMF reduces it’s global economic growth forecast three times next year.
S&P per share earnings fall by over -10% in 2019. 2) The Federal Reserve Pauses and Then Cuts as Currencies and Interest Rates Swing Wildly:
It’s a wild year for fixed income and currency volatility.
The Fed cuts rates in 3Q2019 and by year-end announces that QE4 will commence in January, 2020.
The 2018 tantrum in Italian bonds is just a precursor for hissy fits throughout the European bond market as the ECB is no longer expanding its balance sheet and tries to get out of NIRP.
The BoJ throws in the towel on their drive for higher inflation. The Japanese bond market sees sharp selloff.
During 2019 the yield on the ten year U.S. note falls to 2.25% before ending the year at over 3.50% as the selloff in European and Japanese bonds and the announcement of QE4 drive our yields higher. Gold falls to $1050 before ending the year at over $1700. 3) Stocks Sink:
Though the third year of a Presidential cycle is usually bullish – _it’s different this time._Trump confusing _brains with a bull market_ can’t fathom the emerging Bear Market. At first he blames it on Steve Mnuchin, his Secretary of Treasury (who leaves the Administration in the middle of the year). Then he blames a lower stock market on the mid-term election which turned the House. Then he blames the market correction on the Chinese.
The S&P Index hits a yearly low of 2200 in the first half of the year as the market worries about slowing economic and profit growth and a burgeoning deficit/monetization. The announcement of QE4 results in a year end rally in December, 2019. In a continued regime of volatility (and in a market dominated by ETFs and machines/algos), daily swings of 1%-3% become more commonplace. Investor sentiment slumps as redemptions from exchange traded funds grow to record levels. The absence of correlation between ETFs and the underlying component investments causes regulatory concerns throughout the year.
Congress holds hearings on the changing market structure and the weak foundation those changes delivered during the year.
Short sellers provide the best returns in the hedge fund space as the S&P Index records a second consecutive yearly loss (which is much deeper than in 2018).
As the Fed cuts interest rates the US dollar falls and emerging markets outperform the US in 2019.
I, like many, are concerned about corporate credit (See Surprise #8) and though credit is not unscathed, it is equities that bear the brunt of the Bear since they are below credit in the company capitalization structure.
Bottom line, after a steep drop in the first six months of the year, the markets rise off of the lows late in the year in response to this shifting political scene (the decline of Trump) and a reversal to a more expansive Fed policy – ending the year with a -10% loss. 4) Despite the Appearance of the Bear, FANG Stocks Surprisingly Prosper (Both Absolutely and Relatively) as Investors Seek Growth (at any cost) In a Slowing Economy – Facebook’s Shares Rebound Dramatically:
While there is a growing consensus that FANG will lead a Bear Market lower – that is not the case as growth, in a general sense, is dear and cherished by market participants next year. Among FANG, Facebook
‘s shares have a reversal of fortune (and is the best performing FANG stock) as the company announces aggressive management changes and moves to remedy the misinformation trap.
As more previously unrevealed information reduces her valuation, Sheryl Sandburg’s special status as a female leader (in a seascape of men at Facebook and in industry) is questioned. In the first half of 2019, Sandberg becomes a sacrificial lamb and is sacked – and is forced to lean out
after leaning in.
At the suggestion of Warren Buffett (who has accumulated a sizable stake in the company), former Board Member Donald Graham
is named as the new, independent and Non-Executive Board Chairman of Facebook.
This unexpected move encourages FB investors to believe that the company is quickly moving to fix its multiple data and privacy issues.
Fewer (than feared) Facebook members opt out and growth in usage resumes in the back half of 2019.
FB’s stock popularity (and market capitalization) increases as it becomes a more dominant holding in “value investors” portfolios – the shares trade above $200/share late in the year. 5) “Peak Trump” – the President Bows Out in His Pursuit of a Second Term
The President’s dismissal of the murder of Washington Post reporter Jamal Khashoggi is seen as delivering tacit support to Saudi Arabia’s MBS – it is a pivotal turning point in Trump’s popularity and ultimate reputational decline in 2019. _“Pay enough and you can get away with murder”_ becomes the mantra of the Progressive Left. Trump acceptance by his Republican party peers quickly diminishes as they are further worried about his motivation to side against the findings of his own intelligence department. After Trump’s personal dealings with authoritarian and autocratic countries are revealed in the Mueller probe (along with possible emoluments violations), Trump’s popularity fades further as Lindsay Graham and other prominent Republicans repeal their support and denounce the President.
An anti-imperial rebalancing is mounted, in which a more assertive Congress brings the country back into constitutional equilibrium.
Though the public and political leaders (even on the right)_ increasingly reject the President, there are no impeachment efforts by the Democrats. Instead
(and surprisingly), House Speaker Pelosi
(recognizing that constructive steps are the recipe for a Democratic 2020 Presidential win) exacts discretion and stops the Democrats from moving on an impeachment in the House. Democratic leadership turns to reforms and a torrent of new legislation in the areas of improving the environment and climate control (and the halt of growth in fossil fuel by the development of alternative energy programs), the opioid crisis, education, crime, voting rights, healthcare and prescription drug prices, immigration, etc.- showing the electorate that their Party can demonstrate the framework for a positive agenda, a vision and a social contract
(and can rule instead of obstruct).But, most importantly… With real GDP turning negative in 2019’s second half, Democrats attempt to replace Republicans’ supply-side economics with a smarter theory of growth. Recognizing just as inflation and other ills opened the door for criticism of Keynesian economics in the 1970s, so have inequality and disinvestment done the same for critiques of supply side today. In 2019, the Democrats turn the table on the supply-siders and give a voice through thoughtful proposed legislation
(making the affirmative case for the Democratic theory of growth geared to raising wages and putting more money in the hands in working- and middle-class people’s pocket and investing in their needs). Americans enthusiastically embrace this alternative
(of how the economy works and grows and spreads prosperity) and reject and defeat the long standing Republican economic narrative – seeing it as a better way to spur on the economy_ (than giving rich people more tax cuts)._ Asking the question _“has it worked for you?_” and given the fairy tale of added revenue from growth
(and the widening hole in the deficit),_ rampant inequality, the fear of being bankrupted by medical catastrophe and massive student debt obligations Democrats provide a practical alternative to cutting taxes for the rich and decreasing regulation which has failed to unleash as much innovation and economic activity that was promised by the Administration. The legislation, which puts more money in middle class pockets, defends and supports the notion that the public sector can make better decisions than the private sector. Referred to as the _“middle – in economic bill,”_ is cosponsored by a leading, conservative and respected Republican member of Congress and begins to gain bipartisan support in Congress, driving a stake through the supply-side’s heart.
Despite his loss of popularity (which plummets to 25%)_ and the push back from the Republican establishment, Trump declares he is still planning to run for President. Nevertheless, a challenge from Senator Mitt Romney
(who’s motto is “Make Republicans Great Again”_) gains steam as McConnell, Graham
, Kennedy Et al. throw their support for the Senator.
As Trump’s problems multiply, Romney becomes the heavy favorite to defeat Trump in the Republican primary.
Recognizing a sure election defeat, by year-end the President announces that his medical team has disclosed a health issue and he is advised not to run for office. _Reluctantly, _Trump agrees and bows out of the 2020 Presidential race late in the year.
The Trump mantra of “Make America Great Again” i_s replaced by _“Make Economic Uncertainty and Market Volatility Great Again.”
#MAGA/#MUVGA 6) The Year of the Woman
With a Trump withdrawal from 2020 the election is wide open.
The arc of history influences the Democratic Presidential nomination march and the leading candidates that emerge for 2020 are mostly women. The potential contenders include progressive firebrands like Elizabeth Warren, Stacey Abrams, Kristen Gillibrand and Kamala Harris, and moderates like Senator Amy Klobuchar and Rhode Island Governor Gina Raimondo.
Michael Bloomberg, Howard Schultz and Joe Biden bowout from the race by year end 2019 By year-end, Klobucher, Harris and Warren surface as the three leading Democratic Presidential candidates.
It appears that an all women Democratic ticket (President/Vice President) is increasingly likely.
Nationally, several high profile sexual harassment suits are disclosed. Allegations against a number of well known television, other entertainment and political icons/leaders serve to reinforce the candidacy of the above women who aspire to gain the Democratic Presidential nomination. After Congressional hearings, non partisan and strict harassment legislation are introduced forcing several well known male politicians to resign from office. 7) A New (But Old) Shiny Object Appears As A Stock Market Winner in 2019
Bitcoin trades close to $3,000 in December, 2018 and spends most of 2019 under $5,000 (as numerous trading irregularities, thefts and more frauds are exposed).
England’s Financial Conduct Authority (FCA) takes the lead, in instituting a comprehensive regulatory response to regulating the crypto currency markets. The U.S. follows by imposing broad-based crypto currency regulation in 2019.
A leading business network (who’s bitcoin “bug” has become the new cover of magazine contrary indicator!) faces a class action suit for their seeming encouragement in buying into the asset class in their too frequent broadcasts during 2018. Several crypto currency guests who were prominent on the network’s coverage are indicted for fraud. In an agreement with regulatory authorities, the biz network’s programming is reconstituted.
Marijuana stocks, after a weak final few months in 2018 (are down by over 50% from their highs)
, explode back to the upside reflecting a quickened pace of alternative health applications. (MJ
) is the single best performing exchange traded fund and (TLRY
) makes another move to $300/share. 8) Private Equity, High Yield Debt and Leveraged Loan Problems (Which Have Doubled in Size Over the Last Ten Years) Emerge as the Resurgence of Leveraged Finance Comes to An End
Private equity, in particular, the biggest winner in the decade long cycle since _The Great Decession of 2007-09,_ suffers – and so do the endowments at several prestigious universities. Covenant- lite financings in junk and leveraged loans – often in opaque and complex structures – topple under the weight of loan defaults. (HYG) (last sale: $83.17) trades $75-$80 as redemptions spike.
Publicly-held private equity shops (KKR
) and Blackstone
) are among the largest percentages losers in 2019, High yield bonds fulfill their characterization as “junk,” and are among the worst performing asset classes. The spread between junk bonds and Treasuries more than doubles – widening dramatically during the summer months. 9) The China/U.S.Rift Intensifies as Trump’s Anger Shifts Towards That Region:
The trade war with China goes into full effect with 25% tariffs. Walmart (WMT
) is adversely impacted and its shares fall by -20% from the recent highs. The Chinese retaliate against major American brands like Apple (AAPL
) . _(“Peak Apple” actually happens and its shares fall below $125/share)._Peter Navarro resigns.
A major cyber-attack against the U.S. financial system, who’s source is initially not diagnosed, is ultimately reportedly to have been delivered by China. The U.S. enters a cold war with China that resembles the emergence of the cold war with Russia in 1948 – it becomes clear it will be lengthy, nasty and unfriendly to the trajectory of worldwide economic growth. 10) Bank Stocks Are Surprising Winners in 2019:
Despite some pressure in net interest margins (and income), sluggish loan demand and a pickup in loan losses – bank stocks (and EPS) are surprisingly resilient and manage to have a positive return next year as better relative EPS growth is supported by aggressive buybacks and (starting) low valuations. Investors look forward to a recovery in economic growth in 2020-21 and bank stocks (flat for most of the year) have a vigorous move in the last few months of the year and are one of the few sectors to advance in 2019.
Oil stocks, depressed from the late 2018 crude oil price fall also recovery mightily in the later months of 2019 as the price of oil advances coincident with dovish turn in monetary policy. 11) Tesla’s Problems Shift From Production to Demand to Financial:
) loses its tax subsidy in the U.S. and in the Netherlands (a large market for them).
European competition grows.
Europe doesn’t allow the Tesla Model 3 due to safety reasons. The Chinese won’t let an American company have video data over millions of miles of roads and bans Tesla. Lenders balk and access to the public debt market evaporates. The company’s financial position deteriorates and its credit default swaps widen dramatically.
An accounting “issue” surfaces – and it morphs into an accounting fraud. Elon Musk, who has leveraged his TSLA equity holdings, faces margin calls and is forced to sell Tesla shares.
After being rushed to the hospital after an overdose, Musk leaves his CEO post to enter drug rehab. 12) Berkshire Hathaway (BRK.A) (BRK.B) Announces the Largest Takeover in History – The Transformational Acquisition of 3M for $150 billion. 13) Amazon (AMZN) Makes a Bid for Square (SQ) but Alphabet/Google (GOOGL) Eventually Acquires Both Square SQ and Twitter (TWTR) 14) With its Share Price Consistently Trading Under Its Book Value During the First Few Months of 2019, Goldman Sachs’ (GS) Partners Take the Brokerage Private in a Leveraged Buyout at $238/share. 15) Brexit Happens: The world continues and the pound is the best global currency.
Here Are 5-“Also Eligible” Surprises:
- AE1) Ford (F) defaults on its loans. Steve Rattner again becomes the “car czar.”- AE2) A major and unexpected global event judged to be impacted by climate issues causes a massive amount of health problems and deaths. Demand for a reversal of Trump policy on climate change comes from his within his own Party and represents another fissure between the White House and the legislative branch.- AE3) Warren Buffett announces his successor. The name, however, is no surprise.- AE4) Angela Merkel doesn’t make it thru the year and Germany has a new leader. - AE5) As is typical with maturing economic cycles, two large accounting frauds of S&PIndex constituents are uncovered late in the year. A previously “sainted” and revered CEO does a prep walk.
All credit to Kluge Two Secret Service Raids Later, Previous Holder of Over $4m in BTC in Good Spirits
One man's world has been inarguably changed, for the better, and the worse, by Bitcoin. Through a shrewd and, what some have claimed dubious, business deal, Nashville, TN resident Michael Brown (known online as “Knightmb”) acquired 371,000 Bitcoins (then worth roughly $20,000 in a market which couldn't bear downward pressure) for $5,000. As of this writing, the 371,000 Bitcoins he purchased in 2011 are currently worth approximately $4m. Now, however, he may not only be Satoshi-less, but may also (again) be at risk of a stay in federal prison.
Who Is Michael Brown? Brown lives in TN with his wife and child, working in just about everything technical. He provides wireless Internet service, designs hardware for other his company and other Wireless Internet Service Providers (WISPs) to use, as well as software. Brown also works as network, email, and website administer for multiple SMBs. Brown is quite familiar with Bitcoin and within the earlier online community. Around 2010, Brown even wrote and published an abstract on “Timekoin,” a proposed Bitcoin alternative he still uses.
Brown's Bitcoins Around the time of Bitcoin's birth, Brown collected money (the project had roughly $12,000 in total funding) and bought hashing power to accumulate Bitcoins. By the time the money had run out, the project owned approximately 371,000 Bitcoins. However, even while the price of Bitcoins were roughly $.06 each, there was only very weak market demand. According to Brown, “It is easy in hindsight to think of how foolish anyone would be to sell that large amount of bitcoins for such a small amount, but back then there were articles written all over the Internet about bitcoin being a pyramid scam or a fools investment. The people (investors) that originally got into it, thought they had made a huge investment mistake and just wanted to get out.” And get out they did, allowing Brown to buy the project and its 371,000 Bitcoins for “only” $5,000.
However, while this collection of Bitcoin would be worth roughly $4,000,000 USD as of this writing, Brown states he did give away most of his holdings, including a large chunk to Wikileaks when they began accepting BTC donations, with Brown adding the quip “At the time though, I might as well have been sending power points from pokemon cards as far as what actual value they would get from it.“ Brown also gave much of his holdings away to those finding his contact information, with the remainder being sold once the Bitcoin market skyrocketed, allowing him to “make back my initial investment plus a lot of interest.“
There have been claims of foul play by Brown's previous partners, who were primarily members of electric bicycle forum Endless-Sphere. Bitcoin Magazine reached out to Justin, the current owner of the forum (Brown previously owned the forum while the Bitcoin accumulation project was ongoing). However, as of this writing, no evidence was brought up indicating Brown had done anything morally questionable. While there was “a three day mutiny” against Brown while he owned the forum, it appears this was solely related to the sale of the forum to another person (not Justin) who wanted the forum to be monetized.
Tax Document Theft In mid-2012, Mitt and Ann Romney's tax documents were stolen from their accounting firm, PWC. Later, PWC received a flash drive and ransom letter demanding $1m worth of Bitcoins to keep the documents private. These documents, as of today, were never released, though it would appear the Romneys never paid the ransom. BitInstant, for their part in grabbing the media's attention in this ordeal, offered the Romney campaign a free USD-to-BTC conversion should they be interested.
The flash drive in the envelope sent to PWC did not just contain copies of the documents the ransomer was threatening to release, but also included two pictures of cats around furniture. The cat pictures were heavily scrutinized by the US Secret Service and considered to be the smoking gun of the case, which Brown says “has kind of turned into a running joke now among friends and family.” The Secret Service then decided, likely with evidence not yet presented to the public, to conduct a raid against Michael Brown and his family's home (again).
Likely taken into consideration by the United States SS was Brown's previous acquaintance with SS agents during their last raid of his house, which occurred in 2009. At the time, Brown worked for an insurance company to help them neatly organize customers' personal information into a spreadsheet. Brown alleges that part of the information he was to organize were social security numbers, which he wasn't sure if was legal. Brown contacted the insurance company but wasn't given proper attention until he threatened to tell national media. Brown says, “They explained that no one should have access to any customer's social security number, but I was trying to show them it was wrong assumption. Soon afterward, instead of fixing the issue, they called the federal government and told them I had stolen their customer data which contained tens or hundreds of thousands of social security numbers.“ It was at this point Brown first experiences the joy of a federal raid, where only his workstation was seized (he would not be so lucky in the future). According to Brown, “After many months and many visits to the Secret Service office in Nashville, the case was finally closed for being a waste of time and resources for the Secret Service and my workstation was returned (damaged). No charges were ever filed and the case dropped.“
The 2012 Raid It was September 14th, 2012 when Brown and his wife would again awake to bright flashlights being shone in their faces by Secret Service agents. This time, agents demanded answers about the pictures of cats written to the USB drive included with the ransom letter sent to the Romneys' tax firm.
Unfortunately for the Secret Service, they soon found neither the cats nor the furniture pictured. This didn't prevent them from further interrogating Brown and his family, however. His daughter would later be able to identify the cats as being owned by one of Brown's former clients, Janine Bolin, whose computer he backed up for her while helping repair her system. The Secret Service left Brown's house after crawling around his attic and confiscating any electronics they could find. They then paid a visit to Bolin's house, where they'd again confiscate all electronic equipment in case it might have evidence.
Brown states legal fees may be as high as $6,000, with other damages including what was done to his house (including the stereotypical broken doors), and says the situation the US Secret Service has created is similar to if “your local plumber has his entire truck taken, along with all the tools he uses for the trade.” Brown appears in good spirits, however, saying “if I ever do get any/all of my equipment back, I'm going to have a lot of extra of the same thing at least.” Brown ends responding to my questions with “Overall, the Federal government is made up of regular people like myself. The Federal government makes mistakes and bad things happen because of it. The most our family can do is pick up our life and move on. That is why we were reaching out for help. There have been many times when I've donated money or resources to help those in need, I guess it is time I ask the same in return of my fellow man.”
Brown has created a site for donations at www.mbdonationfund.com
Sex and taxes: What the Romney returns and the Edwards precedent say about political slush funds. by Bill Allison. investigations; Sep 10, 2012 11:47 am . Share This: The cloak and dagger tale circulating on the Internet about a group of hackers who claim to have purloined old tax returns of GOP presidential candidate Mitt Romney and say they will release them to whomever is first to pay their ... You’ve probably heard claims that Mitt Romney wants to cut taxes by $5 trillion. Here are five things you should know about that figure: 1. $5 trillion is the gross amount of tax cuts he has ... The latest uproar came when Senate Majority Leader Harry Reid, D-Nev., said Romney paid no taxes for ten years. "He should come forth with his tax return, not because there's been a charge, [but ... Romney released his 2011 tax return, which showed that he paid a tax rate of approximately 14 percent on more than $13 million of reported income. Mitt Romney said recently that he has paid “at least 13 percent” in federal income taxes each year, but the campaign won’t go into more detail (for a closer look at his 13.9 percent rate in 2010, see our previous reading guide).
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