Discussing issues that The United States face both foreign and domestic. A Non-partisan viewpoint where we believe in right and wrong not right and left, hopefully forming a more UNITED States of America.

Friday, June 24, 2016

Why the U.K. Voted for a "Brexit" From the E.U.

The E.U. Referendum is a clear message on the current state of world affairs. There is insanity, inaction by world leaders, the West has failed with regards to security, and people are begging for the madness to stop. Euroscepticism was a taboo word on Wednesday June 22, 2016; as the sun rose on the old continent on June 24, it suddenly was mainstream.

There are many impacts this vote has on the current state of affairs such in the near future such as trade agreements, sovereignty, immigration, unification and could create a chain reaction across Europe. It can also bring about a new era of prosperity and gains in liberty, individual freedom, and improvement for the quality of life for many. But if tensions rise too high, it can also become as bloody as the French Revolution.

With regards to the politics of Great Britain, the Labour party has some significant soul searching to do. The party has gone far-left after Jeremy Corbyn took over following the 2015 UK Parliamentary election. Yet Corbyn himself was an early Eurosceptic and often critical of the EU despite his party’s politicians (and himself included) almost unanimously endorsed to stay in the European Union. The sole reason this referendum passed for leave the E.U. was the base of Labour party---blue collar workers---in the Labour heartland voted against their party’s wishes and policies.  

While every region in Scotland reported healthy numbers for stay in the E.U., voter turnout was much lower than the Scottish Independence vote and immediately Labour blamed SNP over this loss. Labour is quite arrogant since it now only controls one parliamentary seat in Scotland and is the reason why the Conservatives have a sole majority. The Labour base is furious at the party for not helping their constituents.

This leads to the biggest miscalculation in economics and believers of the constructivism policy over realism. Yes, the overall net gains are beneficial to both sides in free trade agreements and a pact mentality, however, the miscalculation is in adaptability and whom it benefits and hurts. Simply put, a fisherman or manufacturer cannot simply leave their profession (after most likely years or decades in that field) to become the next computer expert or wind turbine engineer via job training or returning to school for a new degree. In the United States, a blue-collar worker cannot simply become the next Silicon Valley expert.

Despite amazing progress in connecting the world in seconds via e-mail and Skype. We can also be connected very quickly in-person via aviation. Yet, a vast majority of people’s future is largely determined by their birthplace in the world and the environment they grow up in. Most people in America---where Americans have a rather high rate of movability---will live approximately only 18 miles away from their mother largely because of economic opportunity.

The greatest political challenge going forward for the United Kingdom will be to remain united. Wales and England clearly voted to leave the E.U. while Scotland voted to remain and the SNP wants to remain in the E.U. while leaving the U.K. Low energy prices pretty much proves Scotland cannot be more prosperous as an independent nation. Oil will not go back to glory day prices that are needed to make Scotland prosperous because drilling in the North Sea is more expensive than many other places around the world. Yet, Scotland is probably the most likely candidate to leave the U.K. and the E.U. may just want that to get revenge and serve as the “punishment” for this vote.

Northern Ireland is a more complicated issue. The vote was 55/45 to remain, however, there appears to be another divide within the once very fragmented country. The DUP region of Northern Ireland (mostly protestant areas) voted to leave the E.U. while the more Catholic regions and border areas to the Republic of Ireland voted to remain. Most likely Northern Ireland will remain in the U.K. yet there are significant questions that need answers should this become an “E.U./non-E.U.” border.

There is another element the world forgot before this vote and perhaps this is why people are most surprised by the result. The land of the birthplace for liberalism pioneered by great philosophers such as John Locke, Adam Smith, and John Stuart Mill voted to essentially say to the European Union: No taxation without representation. Lest we forget the real reason why the 13 colonies declared Independence from the Crown and Parliament was because the colonialists felt they did not have the proper rights as Englishmen as they were being taxed without a seat in Parliament. The U.K. voted on June 23 to tell the European Union it did not have a right to make laws over their sovereign land without proper representation.

Sunday, January 31, 2016

How Each Presidential Candidate Can Win The Primaries

The first caucus in the United States takes place on February 1 in Iowa followed by the New Hampshire primary on February 9. After that, the parties make the system a little more confusing as Democrats have their Nevada caucus while Republicans host their South Carolina Caucus on February 20 while a few days later the parties do the reverse as the Republican Nevada Caucasus and the Democratic South Carolina primary takes place on February 27. The candidates win delegates based of a proportional system in the early states and the candidate with a majority of the pledged delegates officially becomes the party’s nominee for president at the party convention in the late summer.  

Iowa, New Hampshire, South Carolina, and Nevada are the four states the system have allowed to go early in the primaries because of their geographical location, size in population (rather small compared to most states in an attempt to provide stronger voices than in highly populated states), and different demographics, values, and economies. Tuesday March 1 is regarded as “Super Tuesday” because it is the earliest day the Democrat and Republican parties allow other states to choose to host their primary/caucus and they do not have to proportionally align delegates meaning a candidate who wins a plurality of the vote within the state can take all of the delegates for the convention. Most of the time, the frontrunner of the party essentially secures the nomination on the evening of Super Tuesday by winning enough delegates.  Mitt Romney in 2012 and John McCain in 2008 essentially secured the Republican nomination for President because of Super Tuesday. Hillary Clinton and Barack Obama went until the end of the primaries in June 2008 before Obama secured enough delegates to win the party’s nomination.

15 primaries/caucuses occur on Super Tuesday—meaning 19 states/territories will vote in the primaries by the end of March 1—with 11 more contests taking place by March 8. Because there are so many states in such a short period of time occurring all across the country, only the best-financed and well-polled candidates can win the nomination.

Hence for Republicans, while there are still over ten candidates running for President, only three appear to have a realistic chance of winning: Donald Trump, Ted Cruz, and Marco Rubio because of their fundraising and polling. While Jeb Bush has raised over $133 million for his campaign and via Super Pacs, he can stay in the race until the end of the primaries, but his poll numbers suggest he will not do well.

For Democrats, three candidates remain in the race, however, it will come down to two individuals: Hillary Clinton and Bernie Sanders. Now we will analyze who has the best chance to win the party’s nomination and how each legitimate contender can win it.


1) Donald Trump

Yes, the unthinkable one-year ago is most likely happening. Trump is dominating in the polls doing well in the early states of Iowa and South Carolina, while crushing in New Hampshire.  He has virtually spent no many on advertisements electing to let his mouth garner media attention for free advertising. Republican voters feel betrayed by their party for not challenging Obama’s policies domestically (such as healthcare and the national debt) and abroad from Iran and ISIL. There are still two realistic paths for Trump to lose the nomination, however, he is the clear front-runner.

The first way Trump loses the nomination is if the Republican Party presidential candidate field drops from 12 to 2 candidates. A majority of the party still supports candidates not named Donald Trump and they would most likely unify to vote for the Trump alternative candidate. If Marco Rubio and Jeb Bush remain in the race past the first four states and run on Super Tuesday, Trump will most likely be the nominee as the “Establishment vote” is split between the opposition candidates.

The second one is a theory I have stated for months. A significant portion of Trump’s base is blue-collar and union affiliated Democrat registered voters. Yes, much of his support comes outside of the Republican Party. The New York Times has an excellent summary on his supporter base here. At least 27 states/territories have a closed primary meaning voters can only vote in the primary they are registered with. So many Democrats may be shocked when they go to vote than they cannot actually support Donald Trump in the primary. So while poll numbers may be accurate, this won’t necessarily reflect his actual support in primaries. Of the first 19 primaries/caucuses, 7 are closed primaries.

2) Ted Cruz

The Texas Senator is now leading in polls in Iowa and will probably win the first contest. Recent history shows the Republican winner in Iowa does not usually win the nomination.  The anti-establishment Republican base that does not like Donald Trump is supporting Ted Cruz. His base is essentially the Evangelical and Tea Party vote the campaign has dubbed grassroots conservatism. As the establishment/more moderate wing of the party remains divided on Marco Rubio, Jeb Bush, Chris Christie, or John Kasich, this has allowed Ted Cruz to be comfortable in second place and lead in Iowa.

His best path to victory is winning Iowa, skipping New Hampshire, and then using momentum/same campaign style to win South Carolina. Since 1980 (with the exception of 2012), the winner of the South Carolina Republican primary has won the nomination of the party for president. If Cruz wins South Carolina, he is in great position on Super Tuesday because seven of the fourteen states on Super Tuesday take place in the South and southern states historically tend to vote for the candidate that represents on of their states.  It is possible for Ted Cruz to win 9 of the first 18 states, which would most likely help him secure the nomination, especially if there are at least three/four candidates still competing on Super Tuesday. The Cruz campaign is gaining momentum and is most likely the candidate that can win over a portion of Trump supporters that are not the most loyal to Trump because Cruz is also viewed as an outside to D.C. politics and is also anti-establishment. Should Dr. Ben Carson drop out of the race early, most likely much of his support will go over to Cruz.

3) Marco Rubio

Heavyweight donors, influential members of the Republican Party (the “establishment”) are shifting their support to Rubio. He is young, refreshing, and shares the story of the average American taking on student loans and coming from a middle class family. His background and support does show the stars aligning for a Rubio nomination, however, there are still significant obstacles in his way, mainly a plurality of candidates still in the race.

If the race were Rubio versus Trump or Rubio versus Cruz, Marco Rubio wins the nomination. The problem is his base of supporters is split amongst many candidates, including Jeb Bush who is also from Florida. Many Bush supporters and donors have Rubio has their second choice, however, they are loyal to the Bush family. They will most likely not switch their vote (which could provide Rubio a boost of 5 to 10 percent more in support, which would be critical in certain states) until Jeb Bush officially drops out. Thus the nomination could come down to how long Jeb Bush stays in the race even though Bush’s odds of winning are now slim to none.

Rubio’s other obstacle is performing well in early states. Nationally, he is considered in third or fourth place, but in the early states he is at least twenty points behind the frontrunner. Rubio must place at least third in Iowa and win New Hampshire or be in a close second in order to have a clear path for the nomination as that boost could help him do well in South Carolina and Nevada (where he does have family ties in that state) to place himself in a great position for Super Tuesday. Unless he pulls off a semi-miracle in New Hampshire or the field shirks to three or four candidates after Iowa, Rubio faces challenges for the nomination despite a well run and funded campaign with prominent supporters.

Jeb Bush

Not much should be said about Bush except that how poor his campaign has performed despite raising the most money. His last name is a liability, as voters do not want another political dynasty. His record in Florida qualifies him as a great candidate, but there is zero momentum behind Jeb! The two ways he can win are via a miracle in New Hampshire and then using his money for Super Tuesday or if there is a broken convention where delegates are split between Trump, Cruz, Rubio, and Bush in a distant fourth where none have a majority. After the first ballot, delegates are no longer bound to their candidate and can vote for anyone. This would be the only slim chance Jeb has for the nomination. The last brokered convention for Republicans was in 1948 where it went three ballots before choosing the front-runner Governor Thomas Dewey who lost to FDR.


1) Virtual Tie Between Hillary Clinton and Bernie Sanders

While this may come as a surprise, Bernie Sanders path toward the nomination is becoming more realistic by the day. The polls are tightening in Iowa and he will most likely win New Hampshire. If he wins both Iowa and New Hampshire, he will be the favored candidate to win the nomination.

Hillary’s national support is falling faster in 2016 than 2008 as shown in the graph.

The email scandal, her trustworthiness, plus the FBI criminal investigation into the emails is now turning into a public corruption investigation where it appears donations to her non-profit Clinton Foundation by authoritarian regimes were given preferential treatment by Secretary Clinton’s State Department.  This investigation is now very serious and Michael Bay’s 13 Hours movie about the Benghazi incident that was just released will not help her. Clinton’s campaign of simply stating, “vote for me because I’m a woman” is not resonating with all the voters, as they want more substance on the issues that are affecting Americans. Her “Mi Abuela” campaign effort to attract Hispanic voters has backfired when a massive social media movement occurred under the hashtags #NotMiAbuela and #NotMyAbuela.  Clinton has also failed to go on the offensive against Bernie Sanders such as his horrible “rape fantasies” essay he claimed women enjoy the thought/imagining they are being raped. Instead, she just chooses to adopt most of his positions after he states them in a debate. Meanwhile, Sanders is able to attack her with regards to Wall Street reform and speaking fees she has accepted from Goldman Sachs.

Bernie Sanders has run a clear message about his socialist policies and college students, the same base that gave Obama the nomination against Clinton in 2008, love his message. Millennials (including Women Millennials) support Sanders over Clinton. If other minority voters jump on to the #FeelTheBern bandwagon, 2008 may be déjà vu for Clinton in 2016. Clinton still has the lead for minority support though against Sanders. There are two main factors in the race that can still secure Clinton the nomination.

The first is Southern states are voting early and Clinton is much more likely to win those states on Super Tuesday because southerners do not like the appeal of socialism Bernie Sanders is campaigning on and the Clintons are from Arkansas.  The second reason is the likelihood of Sanders winning the nomination. Many Democrat voters I’ve talked to (especially Millennials) like the message and are more politically aligned with Sanders, however, they do not think he can win against the Republican nominee. If Democrats are more concerned about winning in November versus voting for who they like the most, then Clinton will win. If Sanders can convince voters he is a movement similar to Obama, then Bernie will have the edge. If Sanders wins Iowa, New Hampshire, and either Nevada or South Carolina, it is most likely over for Hillary Clinton’s campaign.

Monday, February 2, 2015

The Energy Price War of 2015

KAL Cartoon 2014. "Sheiks vs. Shale" Economist Cover
At the end of January just after Saudi King Abdullah died and power transitioned to King Salman, oil prices saw a slight uptick and closed just below $60 a barrel and natural gas closed at about $3 BTU. As noted in my previous article, Saudi Arabia and the United States are using this price war for their own reasons and are somewhat in conflict with each other. Saudi Arabia is trying to take out its competitors, both within OPEC and the U.S. shale industry. The United States is attempting to hurt the Russian economy and Vladimir Putin. Fortunately and unfortunately (depending on your perspective), both nations are achieving their goals in this price war.

Smaller U.S. energy companies did not hedge properly for these low prices and could face the consequences (even bankruptcy) before the summer. Permit requests in the Marcellus Shale are beginning to take a nosedive and North Dakota is not predicting billions in lost potential revenue for years to come. Larger U.S. energy companies will do just fine and either hedged properly or can absorb short term low levels. Newly elected Democrat Governor of Pennsylvania, Tom Wolf, recently signed an executive order banning new fracking operations within the commonwealth. New York has a similar ban. Voters in Denton, Texas also banned fracking in a recent referendum. Lawsuits are guaranteed to occur in at least the Pennsylvania and Texas cases. Many regions within the U.S. fracking industry can barely break even at $60 a barrel of oil, however, the industry would be optimal in the $75-$90 range, which is still fairly below the break even budgets for many OPEC nations and Russia which is over $100 a barrel.

The "biggest losers" in the price war will be African OPEC countries, Venezuela, and Russia, with the potential of massive political instability as a ripple effect. At a World Affairs Council of San Antonio meeting, Ambassador Roger Noriega predicted President Nicolas Maduro will not last beyond this spring as grocery stores are empty and the people are ready to riot in the streets. Ambassador Noriega does not think the police or military will intervene compared to how they acted and arrested/intimidated hundreds, if not thousands of people following the election of Maduro. Venezuela cannot afford these low fuel prices and Maduro's global trip begging for money from countries such as China was a failure.

The Arab Spring countries could also face another wave of protests as these nations need oil to be well beyond $100 a barrel to even somewhat function/recover from the former regime collapses. Another nation that needs higher energy prices is Nigeria as it struggles to combat Boko Haram (the ISIS of Africa) and is due for an election in February for President where the Muslim candidate, Muhammadu Buhari, will most likely defeat the incumbent Christian President Goodluck Jonathan. These price wars will cause regimes to collapse or institute massive policy changes before the fall and most likely cause a political vacuum potentially spanning across at least three continents.

Experts in the energy sector who have consulted with me over the past few months predict prices could go as low as $35 a barrel for oil in the summer months (a time when reserves are at their highest because of multiple factors) and still reach around $90 a barrel by December 2015. The problem is even if the $90 is reached in eleven months, it will be too late for many regimes. Saudi Arabia will eliminate some of its OPEC rivals and the U.S. industry will take a black-eye. The three unknown factors will be just how well the U.S. fairs during this time frame (along with Canada) and whether it can collapse OPEC and Saudi Arabia once and for all. The second factor will be how Russia survives a massive recession (and most likely a depression) because of energy. Putin is still very popular in Russia, yet that could begin to change this year. The last factor and most frightening is what will exactly happen to Venezuela and the African OPEC countries. A second "Arab Spring" may occur this year, giving another chance for radical groups to take even more land.

Sunday, December 7, 2014

Lower Energy Prices: How It Changes The World's Situation

Photo purchased by myself for commercial use, 2014.
Earlier this week, the price for a gallon of gasoline fell below $2.00 a gallon in some locations around the San Antonio, TX region. The price of oil closed on Friday below $67 a barrel with Natural Gas NYMEX around $4 with forecasts still predicting a free fall in the price. In a world of chaos where Russia is annexing territory, Iraq and Syria is in shambles without effective governments, the Middle East is still suffering from the Arab Spring, Iran is going to get a nuclear weapon while promising the destruction of Israel, plus the growing energy demand in Asia and across the globe; the market should be freaking out and the price should conceivably be closer to $150 a barrel than $67.

Americans will certainly not complain as this will put extra money into their back pockets and may actually give a mini-stimulus to the economy for the Christmas shopping season. Yet, these latest developments in the energy sector will have massive implications worldwide, especially in the foreign policy arena.

The energy-dependent economies need the price of oil to be much higher. Business Week claims Russia made its 2015 budget on the forecast of oil being around $100 a barrel. With sanctions hurting their economy, the Ruble losing much of its power compared to the U.S. Dollar, along with the price of oil and natural gas well below their forecast, Russia will go into a depression. Putin is the man who is known for rebounding the Russian economy and nationalizing its energy industry in response from the collapse of the Soviet Union. Now he may have to answer for the soon-to-be next depression in Russia. Yet, this also raises another interesting question, why is OPEC refusing to cut production if so many of the countries (as shown in the chart above) need oil to be much higher? Saudi Arabia needs it to be around $100 a barrel because it has been subsidizing its population to prevent the Arab Spring there to preserve the House of Saud, yet they are pushing for the same levels of production. There are two reasons for this, which the second is in response to the first reason.

1) The United States of America is now the number 1 energy superpower
2014 is a historical marker for U.S. energy. It officially surpassed Saudi Arabia as the world's largest producer in oil and earlier surpassed Russia as the world's largest producer of natural gas. Because of laws that are around 40 years old banning exports (with certain and limited exceptions); the U.S. is still way behind in selling the commodities on the international market; much to the chagrin of Europe and parts of Asia. The fracking revolution from North Dakota to Pennsylvania to Texas now has America projected to be energy self-sufficient (with Canada as a partner) by 2020. America not even at its full production potential as federal lands still have bans on drilling (as almost all of this revolution is in the private sector and on private lands) yet has crashed the price in energy. On a recent trip in South Texas with some of the best and brightest minds in the sector to visit multiple fracking sites and all stages of the operation (to the pipelines to the refineries in Houston and Louisiana area), it was clear just how beneficial this is to our economy, in fact it's almost incomprehensible. Hotels and Motels charge by the hour (at rates you'd expect to be for a day), restaurants are packed, vehicles are brand new, repair shops are all over, the only industry hurting is fast-food employees. We met with Halliburton's number one team who are breaking fracking and drilling records right here in the United States. The U.S. can control its own destiny soon in energy.

2) OPEC is freaking out and hopes to crash American energy production industry
The price of oil and natural gas right now leaves very little room for profits because in many shales, America has to drill thousands of feet in order in order to reach the resources. OPEC realizes if America stays in the energy game, it's power and control is doomed. Permit requests have been falling in the U.S. as a response to the now low prices. Saudi Arabia is hoping to take a short term loss for a long term goal of American companies pulling out of the U.S. and going elsewhere (largely back to them) for a long term gain of higher oil prices above $100 a barrel which OPEC and Russia need. It's a gamble, but this is their only move.

What Should We Do?
Believe it or not, this question is more complicated than what it may seem at first. The United States should look after its own needs and become energy sufficient. This is a massive opportunity to secure our needs and also revolutionize our own economy and perhaps be a piece to balancing the budget. The refining (we need much more LNG production, the first LNG train in the U.S. is still in production) and export opportunities to Europe and Asia can make the US a potential power player in the exporting of energy as well. Yet, we will also have to face the global consequences of our action.

1) Russia will align with China and perhaps India

For their own economic needs (particularly energy), Russia will be forced to take its energy resources and instead of mainly sending them to Europe, will make it travel east to China. This will only further the rift between the West and Russia and perhaps could bring about a global conflict along the lines of NATO vs. Russia & China. Putin will also have to escalate conflict around the globe because the only way to potentially raise fuel prices is with conflict. Ukraine now could look minor in comparison to future conflicts perhaps spanning from the Caucasus, Scandinavia, to Moldova.

2) The Middle East could collapse

If the United States no longer needs foreign fuel outside of North America, the economies of OPEC will not be able thrive causing a depression. Authoritarian regimes will collapse. Many may argue this would be a fantastic scenario, and the optimist could say democracies would take over. One should be cautious. Is Libya better off without Gadaffi? Is Iraq better off without Saddam Huessein? Both were brutal dictators that now share a special place in Hell. Yet in both scenarios, radical terrorism has taken over and created a nightmare situation. Imagine what will happen to Saudi Arabia, Qatar, and Bahrain where the U.S. has massive military interests if their regimes fall due to low energy prices. Radicals will takeover and bring a huge security threat to sovereign nations across the globe. The American homeland will thrive, yet this situation with leaders such as Putin and an expanding nationalism attitude in China could then cause a third global conflict. The powder keg was all ready in place for World War I; the spark was the assassination of Archduke Franz Ferdinand. The situation in the Mid East coupled with low energy prices could be the modern powder keg.

Thursday, July 17, 2014

Is The Republican Party Becoming The Whigs?

2012: Floor of the Pennsylvania House of Representatives.
Photo taken by myself.
Since the emergence of the Tea Party in early 2009, the movement has largely been battling for political ideology within the Republican Party. Since then, it has been interesting to examine how the movement has transformed across the nation, especially within the Republican Party.
While the Establishment will never admit this, if not for the Tea Party movement and the historical wave election in 2010 (in both federal and local elections) the GOP would be in a much weaker position today.
The 2010 elections broke records for Republicans for state legislatures, local elections, and near record levels of holding 29 of the 50 state governors (expanded to 30 by 2012).
What this allowed is political "life" for the Republican party for at least ten years, until the year 2020. After the 2010 Census, all house seats must be redistricted. This process is largely held by the states and gerrymandering ran wild. Take Pennsylvania for example.
As of May, 2014, Democrats hold nearly 50% of all registered voters and outnumber Republicans by over a million voters in Pennsylvania. Yet, Pennsylvania holds safe majorities in the two tiers of the state legislator and in terms of Congressional Districts, the GOP holds a massive 13-5 advantage with only 3 or 4 seats that are competitive in a worst case scenario election year for Republicans along the lines of 2006 (Note: the GOP was actually able to gain a seat in 2012 thanks to redistricting when Democrats coat-tailed Obama statewide). This means Republicans will hold at least half of the congressional seats (9) until 2022 in a state where they are the clear minority.
This occurred across the nation after the 2010 elections. In 2012, Republicans lost by nearly 1.5 million votes in congressional district elections nationwide, yet easily and safely held the House of Representatives under the weak Speakership of John Boehner. Republicans will hold the House of Representatives until probably the year 2022.
Thus, if the GOP is not careful, the political infighting since 2010 could be catastrophic for them if it's not fixed by the 2020 elections. Recent primaries and elections show just how bad it has become. In 2013, the Republican National Committee refused to help the conservative nominee, Ken Cuccinelli, in the Virginia Gubernatorial election. If the RNC had helped, they could have won that election and given him at least a 2 point bump.
More recently this year in Mississippi, the Establishment had to recruit Democrats and launch racist campaign advertisements (that were false) against conservative candidate Chris McDaniel in order for Senator Thad Cochran to win the runoff. Essentially, the more liberal wing of the Republican party would rather have Democrats win elections than have members affiliated with the Tea Party win as a Republican. To be fair though, since 2010, it appears Tea Party candidates are only winning in more conservative states such as Texas where they crushed the Establishment in nearly all positions for the party in the 2014 primary, but the Tea Party appears to be failing in swing state elections.
The final example is what happened to Virginia in 2014 to the House Majority Leader Eric Cantor. Candidate Dave Brat ran such a cash-strapped campaign, Eric Cantor's campaign spent more money on STEAK DINNERS than the entire Brat campaign. Before this year, the "majority leader" position never lost in the primary. Brat may arguably even be the more liberal candidate over Cantor on certain issues, but party members have become so sick of the Establishment that they have the "throw the bums out" mentality. The closest poll had this primary with a 9 point advanatge for Cantor. Even Brat admitted the day before of the primary on the Glenn Beck Program that he needed a mini-miracle and that it appeared the race was finally within single digits (as only that one poll suggested). The Establishment panicked as it was rumored Cantor was going to become the next Speaker in 2015 yet failed to listen to the message. Now the fairly liberal California Representative, Kevin McCarthy, is the new Majority Leader.
The party will collapse if this infighting continues because numbers going into the future look bleak for the party. As the Hispanic population rapidly grows, if they continue to vote over 60% for the Democrat Party, it will become nearly impossible for Republicans to win another national election. George W. Bush was the best candidate in the GOP's history with Hispanics voting around 40% for him. In 2012, even if Mitt Romney somehow did way better than that number (when he actually did way worse) and captured over 50% of the Hispanic vote, he still would have lost the election.
A unified Republican party between the establishment and the more conservative wing is still going to have a hard time competing in Presidential, swing states, and border states in the years to come. A divided Republican Party can only mean one of two scenarios: The Democrats solely dominating government for the next thirty years or a legitimate third party emerging and collapsing the GOP; thus restoring the two-party system.
Both events occurred in our political history. Between 1815-1825 (although one could argue this continued until Andrew Jackson won in 1828) is known as the "Era of Good Feelings" (which is a terrible title) as it emphasizes the collapse of the Federalists, leaving only one party in charge while the eventual post-Federalist "Whigs" were just the minority.
In 1848, a small third-party was formed initially called the Free Soil Party. It was a single issue policy party that wanted the abolition of slavery. It mainly consisted of former Whig Party members but some Democrats joined as well. This new party was "so radical" and "so divisive" that one its members, Charles Sumner, was beaten within inches of his own life by the cane of another Senator on the Senate floor. Within just one decade, this "small" and "radical" party completely abolished the Whigs and the Free Soil Party renamed itself too...The Republican Party.
If the GOP is not careful, at the very least the Tea Party could form itself as a formal party and perhaps cause the collapse and relevancy of the GOP just like the party famously did to the Whigs, or it will collapse like the Federalists and become a permanent minority Whig-like party.
Republicans must do a better job at projecting their image and spread their message of empowering the individual and granting them more rights that can help everyone, not just helping the rich. They must campaign more heavily in the urban areas. They must convince and show urban voters that the historically Democratic run cities of Chicago, Philadelphia, Detroit, Los Angeles, etc. is only falling behind compared to the rest of nation in terms of education levels, violence, and standard of living. In just a few short years, Mayor Giuliani was able to completely flip New York City.
Believe me when I say that I have never met someone my age, working their first legitimate paid job, be "happy" over how much of their paycheck goes to taxes. Yet, very few even know that money they lose from their paycheck will not be there for them when they eventually retire from the workforce. If Republicans cannot spread this message and remain unified, Democrats will dominate at least the national (and most likely the statewide) political landscape for the next 30 years.