The Market Wants a Bigger Cut

Someone call in the vice principal for student discipline! The market is bullying the Federal Reserve again.

Earlier this week, the economic data doused market expectations that the Fed might cut interest rates by 50 basis points. The consumer price index (CPI) came in around where expected, with core prices coming in a little bit hotter. The producer price index was similar: headline hit the consensus expectation, and core came in hotter.

Jobless claims barely budged, inching up 2,000 to 230,000. Weirdly enough, that is just the four week moving average of claims of 230,750, which was just about where the average was the week before. Jobless claims, in short, are once again in a holding pattern at a level that suggests that demand for labor is sufficiently strong to keep layoffs at bay.

By yesterday, the fed funds futures implied odds of a 50-basis point cut had fallen from around even with the odds of a 25-basis point cut to something like a one-in-four chance. This still struck us as far too bullish on cuts given the fact that the Fed meeting is less than a week away. At this point, the overwhelming consensus ought to be that the Fed will cut by one-quarter of a point when the meeting concludes on Wednesday.

The market thinks differently. As of the close of the equities market on Friday, the market was again pricing in even odds that the Fed would announce a 50-basis point cut next week. Keep in mind that there was almost no data that emerged on Friday to support this change of view. The only big news we got was the University of Michigan survey of consumers showing that inflation expectations fell to 2.7 percent. While that will be welcome news to the Fed’s expectation-watchers, it hardly warrants a half-point cut.

A Circle of Joy

It wasn’t just the futures market that seemed convinced a bigger cut is looming. Stocks rallied and bond yields fell. Watching the markets move on Friday, you got the sense that there was a sort of circular confirmation occurring. Futures looked to bonds and saw confirmation of a larger cut, triggering rising stocks, which encouraged bonds to rally and send a signal to futures, which encouraged stocks to rise further.

One reason for doubt about the larger cut is that it would send lots of confusing signals to markets. Many would likely see it as suggesting that the Fed is very worried that the economy is on a weaker footing than it appears to be. At the same time, the supporters of Kamala Harris would no doubt tout the larger cut as a sign that the threat of inflation was in the past—which would in turn provoke political backlash from the supporters of Donald Trump.

A 25-basis point cut would allow the Fed to send a message of cautious optimism about growth and inflation. The Fed has been suggesting that it is now more worried about downside risks to growth and employment than upside risks to inflation, but it is still worried about declaring the inflation threat over too early. We think the Fed is likely to want to proceed cautiously as it cuts, allowing the labor market to determine the pace so long as inflation continues to moderate.

So, what is the argument for a larger cut? According to some well-known monetary policy “rules,” the current federal funds rate is perhaps two points too high. So, a larger cut would move the Fed further along toward the level recommended by, say, the Taylor Rule.

The trouble with this is that there’s no reason for the Fed to rush toward a rules-based level. With the labor market showing signs of steadiness and inflation only creeping down slowly, a series of 25-basis points cuts will get the Fed there. Arriving at, say, a three percent fed funds rate a month or two early is not going to make much of a difference—so why not take things slow and steady?

Originally Posted At www.breitbart.com

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The sanctuary state of California may soon offer discounted cellphone service to low-income foreign nationals who do not have Social Security Numbers (SSNs), including illegal aliens.

A proposal before the California Public Utilities Commission would open up the state’s “LifeLine” program, which subsidizes phone bills for low-income Californians, to residents who do not have SSNs, including illegal aliens.

“… the California Universal LifeLine Telephone Service Program (California LifeLine) should extend eligibility to Californians without a Social Security Number (SSN). This decision establishes a process for Californians without an SSN to enroll in California LifeLine,” the proposal reads.

The move would come just after Gov. Gavin Newsom (D) vetoed legislation that would have used state taxpayer money to help illegal aliens buy homes in California.

Last year, though, Newsom expanded state taxpayer-funded health insurance policies to illegal aliens residing in California — becoming the first state in the nation to do so. About 1.2 million illegal aliens are expected to eventually be using subsidized health insurance.

Today, about 4.7 million illegal aliens and their United States-born children reside in California.

John Binder is a reporter for Breitbart News. Email him at jbinder@breitbart.com. Follow him on Twitter here.

Originally Posted At www.breitbart.com

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Democrat vice-presidential nominee Tim Walz’s political journey is rooted in his involvement with a progressive training camp inspired by the radical vision of Paul Wellstone, a professor-turned-politician with close ties to the Democratic Socialists of America and strong influences from Marxist figures and extreme far-left ideologies.

Before entering politics, Tim Walz was known as a high school teacher and football coach in Mankato, Minnesota — an outsider who embraced a humble, folksy image. However, his true political foundation began in January 2005 when he attended Camp Wellstone, a training ground for grassroots progressives founded and named in honor of the late Sen. Paul Wellstone to carry on his legacy and train people in his methods.

The boot camp was designed to teach community organizing, large-scale grassroots campaigning, as well as progressive leadership and electoral tactics. Under the guidance of radical socialist activists, Walz would polish his political skills and master the fundamentals of running effective campaigns, culminating in his 2006 upset victory in Minnesota’s staunchly conservative 1st Congressional District. The win followed an insurgent campaign aided by fellow Camp Wellstone alumni, including future Lt. Gov. Peggy Flanagan.

Paul Wellstone: From Radical Professor to Political Icon 

Prior to his political career, Paul Wellstone, the inspiration for the camp, was a political science professor at Carleton College who earned his Ph.D. with a dissertation on black militants. He was an ardent advocate of Saul Alinsky’s Rules for Radicals and the belief in confrontation and acts of civil disobedience as a means of achieving political power.

Wellstone would teach such methods in his classes and even invited Alinsky — the father of modern community organizing — to his campus, once remarking: “I am an old Alinsky organizer.” He also had prominent figures such as noted welfare activist Frances Fox Piven and 1960s radical George Wiley, widely regarded as the father of the “welfare rights” movement, speak in his classes.

Wellstone’s political rise was supported heavily by the Democratic Socialists of America (DSA), which played a key role in his electoral success. He served as an adviser to the Young Democratic Socialists of America (YDSA) and, throughout his career, maintained close ties to the DSA, which recognized Wellstone as “explicitly democratic socialist in orientation.”

In 1990, with the help of the DSA, who dubbed it a “watershed campaign,” he stunned the political establishment by defeating two-term Republican incumbent Rudy Boschwitz in a Senate race, despite being outspent sevenfold.

In 1996, DSA leader Christine Riddiough was dispatched to Minnesota to aid Wellstone’s reelection, helping to organize volunteers in key constituencies, which undoubtedly contributed to his nine-point victory. Following his win, the Washington Post described Wellstone as “not really a [conventional] liberal at all.”

“He is a radical and, yes, a 1960s radical at that,” the paper explained. Similarly, progressive Mother Jones magazine held him up as “the first 1960s radical elected to the US Senate.”

Sen. Bernie Sanders (I-VT) called Wellstone a politician of “extraordinary vision,” while then-Sen. Al Franken (D-MN), in his final speech on the Senate floor, described Wellstone as a “tireless, passionate champion for working families.”

Wellstone would later die in a plane crash along with his wife, daughter, and staff members while campaigning for reelection just days before the 2002 election.

Remarkably, both Wellstone and Walz share striking parallels in their political paths.

Walz’s 2006 upset mirrored that of Wellstone, his role model, as both transitioned from educators to politicians, achieving surprising victories in Minnesota over better-funded incumbents. Like Wellstone, Walz embraced a grassroots, big-hearted, small-town persona, often presenting himself as a relatable, flannel-wearing progressive.

Camp Wellstone: Birthplace of Walz’s Political Career

Once I decided to run for Congress, I went to Camp Wellstone in January of 2005 to learn how to do it. I had no idea; I’d never given a stump speech before.

— Tim Walz

Camp Wellstone was more than just a training program — it served as the incubator for a new generation of progressive leaders, including Minnesota Attorney General Keith Ellison, St. Paul Mayor Melvin Carter, and Flanagan, all of whom were trainers the year Walz attended and are now in positions of power in Minnesota.

Founded in January 2003, roughly two months after Wellstone’s death, the camp cultivated a new generation of leaders, using community organizing methods inspired by radical activist Saul Alinsky to shape prominent figures in American politics.

The stated mission of Wellstone Action, which operates the camp, is to honor Wellstone’s legacy by continuing his work through training, educating, mobilizing, and organizing “a vast network of progressive individuals and organizations.”

According to its website, the camp trains candidates, campaign workers, and organizers in “practical skills in progressive political action,” while offering role-specific training in progressive organizing, led by “the nation’s leading experts in grassroots politics and organizing.”

According to Jeff Blodgett, Wellstone’s former campaign manager who would later become Obama’s state director, the camp would turn out “to be a place [for] people who felt like they needed to step up now and kind of follow in Wellstone’s footsteps.” Blodgett himself is a product of radical activism, having trained at the Rockwood Leadership Institute, a hub for progressive activists, many of whom have gone on to work in far-left organizations such as MoveOn.org.

The advisory committee that guided the Wellstone camp featured a slew of radical socialist leaders, including Frances Fox Piven, co-author of the the anti-capitalist Cloward-Piven Strategy aimed at destabilizing capitalism, and Heather Booth, a notorious lifelong radical community activist, founder of Midwest Academy, and self-described dedicated disciple of Saul Alinsky. Booth also had an active role in teaching sessions, where she was known for engaging participants.

Also included were influential union leaders Andy Stern (SEIU), Gerald McEntee (AFSCME), and Richard Trumka (AFL-CIO), along with civil rights activist Julian Bond, who was closely associated with the Communist Party USA (CPUSA).

“Wellstone Action is hands down the ‘go to’ training center in the progressive movement,” once remarked SEIU Chief of Staff Jon Youngdahl. “No one does it better.”

The camp is bolstered by a vast network of far-left organizations and influential funders. Groups like the radical Midwest Academy and far left-wing advocacy organizations such as Moveon.org partnered with the camp to train their members. Additionally, “generous” financial support came from the Tides Foundation and far-left donors, including left-wing billionaire George Soros’ Open Society Foundations, the Rockefeller Family Foundation, and the Bauman Family Foundation, among many others.

This broad base of support amplified the camp’s reach in promoting progressive political action.

Camp Wellstone’s radical influence is also evident from the reading materials recommended for attendees on the Wellstone Action site, which includes titles such as Rules for Radicals, hailed as a “must-read for all progressive activists,” and Poor People’s Movements by DSA Honorary Chairwoman Barbara Ehrenreich, who famously celebrated the re-release of the Communist Manifesto on its 150th anniversary.

In January 2005, Walz, a newcomer with no political experience, joined the camp — arriving at the training as a “paunchy 40-year-old in jeans and a T-shirt” with an “extreme long-shot political goal.” Despite his lack of political background, Walz would quickly absorb the values of progressive activism at the camp, honing his skills and political organizing knowledge.

Wellstone’s son, David, noted that Walz immediately stood out. “You could tell he was a leader,” he said, adding that he believes the camp “helped shape the way that he politicked.”

Longtime progressive activist Pam Costain, who served as Wellstone Action’s education and training director at the time, recalled Walz as “so impressive” that Wellstone Action used him as an example in future trainings.

Walz is featured in Winning Your Election the Wellstone Way, a guidebook by Wellstone Action which showcases his political journey — that falsely claims that he served in Afghanistan — as a case study on how grassroots, community-driven candidates can unseat established incumbents. This endorsement of Walz further aligns him with Wellstone’s political philosophy and the broader progressive movement.

Furthermore, long-time progressive activist and then camp trainer Marcia Avner noted Walz’s growth from the 2005 camp.

“What you see is what we saw back then, but it has been strengthened with extraordinary experience,” Avner said. “He has been so seasoned by the work here.”

When elected to Congress the year after completing the program, Walz became Camp Wellstone’s first successful alumnus at the federal level. He has repeatedly credited the camp (now rebranded as re:power) — which continues to produce leaders who push the boundaries of progressive politics in the U.S. — for shaping his political skills, particularly in grassroots mobilization and message development.

Flanagan’s Rise: From Camp Wellstone to Minnesota’s Second-in-Command

Walz’s partnership with Flanagan, his lieutenant governor and former Camp Wellstone trainer, underscores his deep ties to the far left. Flanagan, who credits Wellstone with her own political rise, stated that “walking by the Wellstone for Senate office my senior year of college changed the entire trajectory of my life.”

She once recalled her father, long-time Native American land rights and sovereignty activist Marvin Manypenny, telling her, “I want to burn down the system, and you want to get into the system and change it from the inside out,” echoing Alinsky and Piven’s approach of working within institutions to dismantle them.

Flanagan has criticized her state for only being ideal for white residents only, supported the removal of a Christopher Columbus statue during the George Floyd riots, and described the state’s government as a tool of genocide against people of color and Indigenous communities.

As Walz’s top adviser, Flanagan has been instrumental in shaping his progressive agenda behind the scenes, often speaking before him at public events, with one news outlet reporting “she has a big say in policies and positions.” After helping him secure his first congressional win following Camp Wellstone, she has continued to play a key role throughout his career.

She once proudly remarked about Walz, “He was my camper; I taught him everything he knows!” Flanagan would later be described by state Democrats as his “progressive whisperer,” with Walz admitting, “[For] every major decision she is there from the beginning.”

When Walz left Congress to run for governor, he chose Flanagan as his running mate, elevating her to lieutenant governor. Together, they pushed through some of Minnesota’s most progressive legislation, including sweeping environmental reforms and radical social justice initiatives, in what became known as the “Minnesota Miracle.”

Both Walz and Flanagan — whose influence reflects the broader Wellstone strategy of pushing far-left policies through grassroots mobilization and political pressure — frequently invoke Wellstone’s legacy, with Flanagan stating, “We all do better when we all do better,” a mantra of Wellstone’s populist vision.

Melvin Carter, the mayor of St. Paul and another trainer at the 2005 camp, called Flanagan a “strong influencer” on Walz’s progressive policies, adding that she “embodies” the state of Paul Wellstone.

Flanagan herself credits Wellstone’s vision for Minnesota for shaping her political path, stating, “I would not be where I am today if not for Senator Paul Wellstone and his vision for Minnesota.”

Watch:

Like Flanagan, Walz has also regularly paid tribute to Paul Wellstone, especially on the anniversary of his death, in posts reflecting a continued dedication to Wellstone’s principles.

Wellstone’s Radical Legacy Endures

Walz’s political career has been significantly influenced by the vision of Paul Wellstone — the radical Alinskyite professor-turned-politician who he credits as the man who “inspired me to run for congress.”

In fact, Walz’s deep personal connection to Wellstone is exemplified by the fact that he carried a piece of the wreckage from the plane crash that killed the senator, using it as a personal keepsake throughout his journey to office.

His connections through Camp Wellstone — along with its advisory board of prominent progressives, partnerships, and collaborations with figures such as Minnesota AG Keith Allison — underscore the strong far-left influences that have shaped his political approach.

The matter comes amid growing concerns that the Walz-Harris ticket may be far more radical than it appears, with deep connections to far-left progressive and socialist movements hinting at a potential shift toward more extreme policy positions if the Democrats are elected.

On Sunday, Bernie Sanders posited that Vice President Kamala Harris adjusted her positions to be “pragmatic” in order to “win the election” during an interview on NBC’s Meet the Press, maintaining that she has not abandoned her progressive ideals.

Walz’s career has also been marked by controversies surrounding his ties to China. His involvement in a student exchange program following the Tiananmen Square massacre, along with multiple subsidized trips to China — Walz and the Chinese government jointly sponsored scholarships for American students to visit China. Between 1989 and 2003, Walz traveled with hundreds of students to China — raising serious questions about his relationship with the Chinese Communist Party.

Furthermore, the House Oversight Committee has launched an investigation into the matter, focusing on his numerous visits and connections to CCP-linked entities.

Last month, following Vice President Kamala Harris’s announcement of her selection of Walz, the radical pro-Palestinian Uncommitted National Movement — which urged Democratic voters to protest President Joe Biden’s support for Israel by casting non-Biden votes in state primaries — celebrated the vice-presidential candidate pick, who has referred to uncommitted voters as “civically engaged.”

Citing senior adviser Elianne Farhat, the group suggested that Walz “has demonstrated a remarkable ability to evolve as a public leader, uniting Democrats’ diverse coalition to achieve significant milestones for Minnesota families of all backgrounds.”

In addition, the DSA praised the selection of Walz as Harris’s running mate, insisting it showed “the world” that the DSA and its allies on the left “are a force that cannot be ignored.”

Originally Posted At www.breitbart.com

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Former First Lady Michelle Obama, who delivered an impassioned speech backing Vice President Kamala Harris at the Democratic National Convention (DNC) in Chicago, Illinois, in August, will not be hitting the campaign trail to back up Harris in the fall, CNN reported.

“Former first lady Michelle Obama, who delivered a rallying cry speech in Chicago, is not expected to campaign, instead sticking with her officially non-partisan voter registration efforts,” CNN’s Edward-Isaac Dovere wrote on Friday.

The revelation is yet another setback for Harris, who has been desperately trying to keep her surge of summer energy riding high into the fall — but not having the highly dynamic Michelle Obama out there for her in a big way is clearly a disappointment for Democrats. It is also possibly part of a growing trend of possible future Democrat presidential candidates doing the bare minimum politically to help Harris but not really investing themselves personally in her success or failure. Of course, if Harris were to win in November, she would, in all likelihood, stand for reelection in 2028, making possible future Democrat stars have to wait all the way until 2032 for another shot at the White House. But, if Harris were to lose to former President Donald Trump, the growing group of Democrats who have their eyes set on the Oval Office would likely have a shot in 2028 — which is just around the corner.

Interestingly, in her DNC speech, Michelle Obama implored Democrats to leave it all on the field.

“We only have two and a half months, y’all, to get this done,” she said in the speech:

Only 11 weeks to make sure every single person we know is registered and has a voting plan. So, we cannot afford for anyone, anyone, anyone, America, to sit on their hands and wait to be called. Don’t complain if no one from the campaign has specifically reached out to you to ask you for your support. There is simply no time for that kind of foolishness. You know what you need to do. So, consider this to be your official ask: Michelle Obama is asking you — no, I’m telling y’all — to do something. Because, y’all, this election is gonna be close. In some states, just a handful — listen to me — a handful of votes in every precinct could decide the winner. So, we need to vote in numbers that erase any doubt. We need to overwhelm any effort to suppress us. Our fate is in our hands. In 77 days, we have the power to turn our country away from the fear, division, and smallness of the past. We have the power to marry our hope with our action. We have the power to pay forward the love, sweat, and sacrifice of our mothers and fathers and all those who came before us.

While she is sitting out the home stretch of the campaign, Michelle Obama’s husband, former President Barack Obama, is expected to help his party’s nominee in the fall.

Barack Obama, the CNN report noted, is “expected to be central” in the “effort” to get what outgoing Rep. Dan Kildee (D-MI) called “magic” going for Democrats in the fall. CNN wrote that Obama’s “aides [are] working to add to his usual slate of late fall battleground campaign rallies — in person or with online influencers, whom he’s been pushing to use their platforms to get followers to vote.”

“The first taste of that will come next Tuesday, for National Voter Registration Day: Obama already recorded videos and other content in Chicago and at home in Washington that his office estimates will be hitting 30 million users across social media, aimed at younger voters,” Dovere wrote.

Originally Posted At www.breitbart.com

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