Pattern Recognition, by Ian Sigalow

A New State Of The Union

Introduction

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Ian Sigalow

Ian is a co-founder and partner at Greycroft Partners in New York City. He has been a venture capitalist since 2001.


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A New State Of The Union

Posted on .

Welcome to my first political-themed blog post (with a mix of social science):

Every election cycle, research firms contact voters and ask questions like “How important is reforming Medicare and Social Security?” or “How important is reducing greenhouse gas emissions by 80% over the next 20 years?” I get these forms in the mail too, and on a couple occasions I even filled them out.

I always assumed that my party’s agenda would be the issues that registered voters feel strongest about. But I was wrong.

A few months ago I was introduced to a group called No Labels (you can check them out here) as well as the core research team at Pew. They shared the inside scoop about how political agendas are crafted in the US. Even though I don’t typically discuss politics I thought the math and psychology behind election results was interesting.

As it turns out, politicians use surveys to create “distance” between candidates. For instance, rather than focus on the issues that registered Democrats care most about, candidates will use a formula like: D – R + I. This takes the weight of the registered Democrat base, subtracts the weight of the registered Republican base, and then adds back Independents. Republicans do the same thing but superimpose D and R. As you can imagine, the resulting agenda is very polarizing.

The crazy thing is that this strategy wins elections. Candidates get support from their base and independents, and they distinguish themselves from their opponents on key issues. Julius Caesar called it divide and conquer.

The obvious downside of this approach is that nobody gets what they really want. The not-so-obvious downside, which many people are finding out right now, is that the winner is left with an ungovernable mess. It is virtually impossible to move the country forward when our President’s strategy is predicated on just how much he can make half of the population dislike him.

I included a snapshot below of the top 5 issues for each party when they employ the “distance” strategy. This is from my friends at Pew and No Labels. You will see how eerily familiar these themes are for current candidates in office.

Republican agenda (R-D+I):

1.) Balance the federal budget by 2024.
2.) Democrats and Republicans strike a grand bargain to reduce the deficit by reforming the tax code and entitlement spending by 2016.
3.) Solve Social Security and Medicare financial problems by 2020.
4.) Reform Medicare and Social Security so it is secure another 75 years.
5.) Cut taxes across the board by 2020 to generate more opportunity and jobs.

Here is the Democrat agenda (D-R+I):

1.) Raise the minimum wage to 12.50 and provide a minimum wage that provides a living wage.
2.) Cut income inequality in America by enacting tax reform that raises taxes on the wealthy and lowers them on the poor.
3.) Make the latest cures and medicines available to every American who needs them by 2020.
4.) Cut the number of Americans living in poverty in half over the next 10 years.
5.) Ensure that every child has access to high quality early education by 2018.

The team at No Labels is trying a different approach. They used the same body of research, but instead of creating “distance” they tried to find the issues that most voters agree upon. These are the results when you take D + R + 2 x Independent:

1.) Solve Social Security and Medicare financial problems by 2020.
2.) Reform Medicare and Social Security so it is secure another 75 years.

3.) Balance the federal budget by 2024.
4.) Create 50 million new jobs over the next 10 years.
5.) By 2018 bring back the 2 million manufacturing jobs lost during the recession.

If you are looking for a true national agenda, this is it.

 

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Ian Sigalow

http://sigalow.com

Ian is a co-founder and partner at Greycroft Partners in New York City. He has been a venture capitalist since 2001.

Comments
  • user

    AUTHOR JohnFrankel

    Posted on 3:11 am January 31, 2014.
    Reply

    Politics. Hmmm…

    Okay: 1.), 2.) and 3.) and doable and sensible for government to do.  But 4.) and 5.) should be outside the remit of government; in part because jobs should not be centrally planned and in part because they can’t do it anyway.  Government creates nothing.  It provides shared services with our money.  Finally, the 2,000,000 jobs lost was probably as much due to the secular impact of technology as a cyclical recession.

    Hope you will still talk to me now that we have discussed politics 🙂

  • user

    AUTHOR sigalow

    Posted on 3:29 am January 31, 2014.
    Reply

    JohnFrankel  I think the government should build a hyperloop (or at least fund an XPrize and provide the land).  That won’t create millions of jobs but it is a start…

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