China Cancels Top Political Meeting As Virus Crisis Worsens
China announced Monday it had canceled the biggest political event of the year, the National People’s Congress (NPC), slated for March 5, as the Covid-19 outbreak continues to worsen, reported The Washington Post.
The cancellation suggests the virus outbreak continues to worsen with more than 77,000 confirmed cases and nearly 2,500 deaths across mainland China. As we’ve explained before, the real numbers are much higher.
China is attempting to reboot its economy as production shutdowns have crashed economic output. The most significant problem with rebooting the economy is that the virus must be completely eradicated first; otherwise, it will continue to spread across towns and factories – forcing even longer shutdowns and prolonging the crisis. This is China’s Catch-22, where in the past, it could lie itself out of almost every problem, now the more lying it does, the worse the situation gets.
China’s top leader, Xi Jinping, told officials at a Communist Party meeting on Sunday that the virus outbreak is a “big test” for the country, and policy adjustments would cushion the economy for a downturn. Xi acknowledged “obvious shortcomings in response to the epidemic,” warning that short-term financial stress could be imminent.
We’ve noted on several occasions that China’s economy remains paralyzed.
Xi said the “the epidemic situation is still severe and complex, and prevention and control work is in the most difficult and critical stage.”
The NPC and its chief advisory body usually begin on March 5 will be pushed out this year – this all suggests conditions in China will remain severe and highlights that Beijing is having a difficult time in controlling the “contained” narrative.
China backtracked on an earlier announcement that would ease travel restrictions on Wuhan, suggesting, once again, the virus outbreak is far from contained.
As we’ve noted, China revised the definition of what a confirmed case is to ease public fears about a runaway pandemic and get more people back to work. But explained above, its Catch 22 situation, as fake data for optically pleasing headlines of a crisis abating, will do more harm than good.
This is the first time the Chinese have postponed the NPC since 1995. China’s economy will likely remain in economic paralysis through March.
Just like the hit series “House Of Cards,” Wall Street earnings season has become rife with manipulation, deceit and obfuscation that could rival the dark corners of Washington, D.C.
What is most fascinating is that so many individuals invest hard earned capital based on these manipulated numbers. The failure to understand the “quality” of earnings, rather than the “quantity,” has always led to disappointing outcomes at some point in the future.
“Non-GAAP financials are not audited and are most often disclosed through earnings press releases and investor presentations, rather than in the company’s annual report filed with the Securities and Exchange Commission.
Once upon a time, non-GAAP financials were used to isolate the impact of significant one-time events like a major restructuring or sizable acquisition. In recent years, they have become increasingly prevalent and prominent, used by both the shiniest new-economy IPO companies and the old-economy stalwarts.”
Back in the 80’s and early 90’s companies used to report GAAP earnings in their quarterly releases. If an investor dug through the report they would find “adjusted” and “proforma” earnings buried in the back.
Today, it is GAAP earnings which are buried in the back hoping investors will miss the ugly truth.
These “adjusted or Pro-forma earnings” exclude items that a company deems “special, one-time or extraordinary.” The problem is that these “special, one-time” items appear “every” quarter leaving investors with a muddier picture of what companies are really making.
An in-depth study by Audit Analytics revealed that 97% of companies in the S&P 500 used non-GAAP financials in 2017, up from 59% in 1996, while the average number of different non-GAAP metrics used per filing rose from 2.35 to 7.45 over two decades.
This growing divergence between the earnings calculated according to accepted accounting principles, and the “earnings” touted in press releases and analyst research reports, has put investors at a disadvantage of understanding exactly what they are paying for.
As BofAML stated:
“We are increasingly concerned with the number of companies (non-commodity) reporting earnings on an adjusted basis versus those that are stressing GAAP accounting, and find the divergence a consequence of less earnings power.
Consider that when US GDP growth was averaging 3% (the 5 quarters September 2013 through September 2014) on average 80% of US HY companies reported earnings on an adjusted basis. Since September 2014, however, with US GDP averaging just 1.9%, over 87% of companies have reported on an adjusted basis. Perhaps even more telling, between the end of 2010 and 2013, the percentage of companies reporting adjusted EBITDA was relatively constant, and since 2013, the number has been on a steady rise.
So, why do companies regularly report these Non-GAAP earnings? Drew has the answer:
“When management is asked why they resort to non-GAAP reporting, the most common response is that these measures are requested by the analysts and are commonly used in earnings models employed to value the company. Indeed, sell-side analysts and funds with a long position in the stock may have incentives to encourage a more favorable alternative presentation of earnings results.”
If non-GAAP reporting is used as a supplemental means to help investors identify underlying trends in the business, one might reasonably expect that both favorable and unfavorable events would be “adjusted” in equal measure.
Why has there been such a rise is Non-GAAP reporting?
Money, of course.
“A recent study from MIT has found that when companies make large positive adjustments to non-GAAP earnings, their CEOs make 23 percent more than their expected annual compensation would be if GAAP numbers were used. This is despite such firms having weak contemporaneous and future operating performance relative to other firms.” –Financial Executives International.
The researchers at MIT combed through the annual earnings press releases of S&P 500 firms for fiscal years 2010 through 2015 and recorded GAAP net income and non-GAAP net income when the firms disclosed it. About 67 percent of the firms in the sample disclose non-GAAP net income.
The researchers then obtained CEO compensation, accounting, and return data for the sample firms and found that “firms making the largest positive non-GAAP adjustments… exhibit the worst GAAP performance.”
The CEOs of these firms, meanwhile, earned about 23 percent more than would be predicted using a compensation model; in terms of raw dollars. In other words, they made about $2.7 million more than the approximately $12 million of an average CEO.
It should not be surprising that anytime you compensate individuals based on some level of performance, they are going to figure out ways to improve performance, legal or not. Examples run rampant through sports from Barry Bonds to Lance Armstrong, as well as in business from Enron to WorldCom.
“One out of five [20%] U.S. finance chiefs have been scrambling to fiddle with their companies’ earnings.”
This rather “open secret” of companies manipulating bottom line earnings by utilizing “cookie-jar” reserves, heavy use of accruals, and other accounting instruments to flatter earnings is not new.
“The tricks are well-known: A difficult quarter can be made easier by releasing reserves set aside for a rainy day or recognizing revenues before sales are made, while a good quarter is often the time to hide a big ‘restructuring charge’ that would otherwise stand out like a sore thumb.
What is more surprising though is CFOs’ belief that these practices leave a significant mark on companies’ reported profits and losses. When asked about the magnitude of the earnings misrepresentation, the study’s respondents said it was around 10% of earnings per share.“
Manipulating earnings may work in the short-term, eventually, cost cutting, wage suppression, earnings adjustments, share-buybacks, etc. reach an effective limit. When that limit is reached, companies can no longer hide the weakness in their actual operating revenues.
There’s a big difference between companies’ advertised performance, and how they actually did. We discussed this recently by looking at the growing deviation between corporate earnings and corporate profits. There has only been one other point where earnings, and stock market prices, were surging while corporate profits were flat. Shortly thereafter, we found out the “truth” about WorldCom, Enron, and Global Crossing.
TheAmerican Accounting Association found that over the past decade or so, more companies have shifted to emphasizing adjusted earnings. But those same companies’ results under generally accepted accounting principles, or GAAP, often only match or slightly exceed analysts’ predictions.
“There are those who might claim that so far this century the U.S. economy has experienced such an unusual period of economic growth that it has taken analysts and investors by surprise each quarter … for almost two decades. This view strains credulity.” – Paul Griffin, University of California & David Lont, University of Otago
After reviewing hundreds of thousands of quarterly earnings forecasts and reports of 4,700 companies over 17 years, Griffin and Lont believe companies shoot well above analysts’ targets because consistently beating earnings per share by only a penny or two became a red flag.
“If they pull out all the accounting tricks to get their earnings much higher than expected, then they are less likely to be accused of manipulation.”
The truth is that stocks go up when companies beat their numbers, and analysts are generally biased toward wanting the stock they cover to go up. As we discussed in “Chasing The Market”, it behooves analysts to consistently lower their estimates so companies can beat them, and adjusted earnings are making it easier for them to do it.
For investors, the impact from these distortions will only be realized during the next bear market. For now, there is little help for investors as the Securities and Exchange Commission has blessed the use of adjusted results as long as companies disclose how they are calculated. The disclosures are minimal, and are easy to get around when it comes to forecasts. Worse, adjusted earnings are used to determine executive bonuses and whether companies are meeting their loan covenants. No wonder CEO pay, and leverage, just goes up.
Conclusion & Why EBITDA Is BullS***
Wall Street is an insider system where legally manipulating earnings to create the best possible outcome, and increase executive compensation has run amok,. The adults in the room, a.k.a. the Securities & Exchange Commission, have “left the children in charge,”but will most assuredly leap into action to pass new regulations to rectify reckless misbehavior AFTER the next crash.
For fundamental investors, the manipulation of earnings not only skews valuation analysis, but specifically impacts any analysis involving earnings such as P/E’s, EV/EBITDA, PEG, etc.
“One of the things that I thought that I knew well was the importance of income-based metrics such as EBITDA, and that cash flow information is not as important. It turned out that common garden variety metrics, such as EBITDA, could be hazardous to your health.”
The article is worth reading and chocked full of good information, however, here are the four-crucial points:
EBITDA is not a good surrogate for cash flow analysis because it assumes that all revenues are collected immediately and all expenses are paid immediately, leading to a false sense of liquidity.
Superficial common garden-variety accounting ratios will fail to detect signs of liquidity problems.
Direct cash flow statements provide a much deeper insight than the indirect cash flow statements as to what happened in operating cash flows. Note that the vast majority (well over 90%) of public companies use the indirect format.
EBITDA, just like net income is very sensitive to accounting manipulations.
The last point is the most critical. As Charlie Munger recently stated:
“I think there are lots of troubles coming. There’s too much wretched excess.
I don’t like when investment bankers talk about EBITDA, which I call bulls— earnings.
It’s ridiculous. EBITDA does not accurately reflect how much money a company makes, unlike traditional earnings. Think of the basic intellectual dishonesty that comes when you start talking about adjusted EBITDA. You’re almost announcing you’re a flake.”
In a world of adjusted earnings, where every company is way above average, every quarter, investors quickly lose sight of what matters most in investing.
“This unfortunate cycle will only be broken when the end-users of financial reporting — institutional investors, analysts, lenders, and the media — agree that we are on the verge of systemic failure in financial reporting. In the history of financial markets, such moments of mental clarity most often occur following the loss of vast sums of capital.” – American Accounting Association
Imaginary worlds are nice, it’s just impossible to live there.
Profs. Michael C. Dorf (Cornell), Andrew Koppelman (Northwestern), and I have filed a couple of amicus briefs arguing that anti-BDS laws generally don’t violate the First Amendment (see, e.g., here, plus this follow-up post from Mike). A Harvard Law Review unsigned student note described us as supporters of such laws, apparently assuming that, since we thought the laws were constitutional, we thought they were wise.
After we pointed out the error, the editors promptly corrected the online versions of the note; but this prompted Mike and Andy to post further on the subject, explaining that they don’t endorse such laws as a policy matter. (My own inclination is to be skeptical of such laws, too, even when limited to conditions on government contracts, though my views on the subject are not firm, at least when applied to large contracts with large organizations.) In any event, if you’re interested in the laws, please check out Mike’s and Andy’s follow-up posts.
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China’s Tourism Ministry Warns Travelers To Avoid US Over ‘Racist’ Treatment Amid Outbreak
In retaliation for Washington’s travel ban targeting Chinese citizens and recent visitors, not to mention the CDC and State Department travel advisories, Beijing is finally putting its foot down: China’s Ministry of Culture & Tourism warned on Monday that Chinese citizens shouldn’t travel to the US because of “excessive outbreak prevention measures.”
Yes, you read that right: China isn’t contesting that the US has the outbreak under control. Rather, it believes the US has gone too far. After the WHO insisted that travel restrictions weren’t necessary, the US and myriad other countries (most recently Israel) tightened their borders anyway.
Now, the People’s Daily is accusing the US government of “unfair treatment of Chinese people”. In other words, Beijing is playing the race card. Put another way: A government that has been accused of jailing millions of Muslims in de fact concentration camps is now arguing that the US’s precautions to prevent a coronavirus outbreak were racist.
People’s Daily: China’s Ministry of Culture & Tourism warns citizens not to travel to the US due to excessive #COVID19 outbreak prevention measures & a security situation which has led to unfair treatment of Chinese people. It also advises awareness of security measures. https://t.co/hqtPfOtr2V
Beijing claimed on Monday that tourists had received “unfair treatment” in parts of the US, and China’s tourism bureau also warned that the “domestic security” situation in the US is lacking – possibly referring to several viral videos of Asian-Americans being berated in public, the Daily Mail reports.
Keep in mind: The coronavirus outbreak, which started in Wuhan, a city of nearly 12 million in China’s Hubei Province, has killed nearly 3,000 people since it started in December. Nearly 80,000 people have been infected around the world.
“The Ministry of Culture and Tourism reminds Chinese tourists to effectively raise safety awareness and be sure not to travel to the United States,” the Ministry said in a statement.
The ministry neglected to offer any details or explanation of its reasoning. The Trump Administration has temporarily barred foreign nationals who have been to China in the last 14 days from entering the US, other than immediate family of US residents and those with permanent visas.
A video that surfaced online earlier this month showed a man attacking a Chinese woman and called her a “diseased b***h” on the subway.
While American SJWs have repeatedly warned that certain elements of the virus response have been ‘racist’, others have ridiculed their warnings as overt displays of hypersensitivity that could put people at risk.
Meanwhile in China, the government is ordering people to go back to work to prevent further economic declines, regardless of their risk of infection.
Then again, it’s not like the US would accept them anyway.
Profs. Michael C. Dorf (Cornell), Andrew Koppelman (Northwestern), and I have filed a couple of amicus briefs arguing that anti-BDS laws generally don’t violate the First Amendment (see, e.g., here, plus this follow-up post from Mike). A Harvard Law Review unsigned student note described us as supporters of such laws, apparently assuming that, since we thought the laws were constitutional, we thought they were wise.
After we pointed out the error, the editors promptly corrected the online versions of the note; but this prompted Mike and Andy to post further on the subject, explaining that they don’t endorse such laws as a policy matter. (My own inclination is to be skeptical of such laws, too, even when limited to conditions on government contracts, though my views on the subject are not firm, at least when applied to large contracts with large organizations.) In any event, if you’re interested in the laws, please check out Mike’s and Andy’s follow-up posts.
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It seems like self-driving cars have been five years away for at least 15 years. But now, major players in the industry—like Google spinoff Waymo, GM self-driving unit Cruise, and upstart Zoox—are promising that fleets of fully autonomous taxis are just about to roll out.
“It’s a scam,” says George Hotz, the 30-year-old hacker-slash-entrepreneur best known as the first person to jailbreak the original iPhone when he was 17. “No one’s close.”
Hotz points out that every system on the road today requires the driver to pay attention at all times and be ready to take over. He says that companies touting fully self-driving cars without human safety monitors—and sometimes without steering wheels or pedals—are offering nothing more than a “press demo.”
Hotz started Comma.ai in 2015 to upend what he views as Big Tech’s wasteful and shortsighted approach to self-driving vehicles. Instead of building specialized cars that rely on expensive sensors and follow laser-mapped routes, Comma.ai has created an autonomous driving system that runs on a smartphone, works on most vehicles sold in America, and requires no additional hardware.
The company’s first truly all-in-one device, the $999 Comma 2, packs a modified smartphone and other hardware into one slim plastic casing, which Hotz 3D-prints in the garage of Comma.ai’s office in San Diego. Mount it to your windshield, plug it into your car’s OBD-II port, and Comma’s OpenPilot software can take the wheel. The Comma 2 uses the phone’s cameras and taps into the built-in RADAR and drive-by-wire systems contained in cars built after 2012, automatically turning the steering wheel and operating the gas and brakes.
Hotz says his company has spent $8.1 million thus far and is profitable, while the big players in the self-driving space have spent billions without offering an economically viable product. While his competitors vie to dominate the market with proprietary technology and ridesharing platforms, Hotz is focused on building an open-source, decentralized ecosystem for driverless technology.
When I first spoke with Hotz in the summer of 2017, he predicted that by 2020, cars would take their own wheels for large stretches without humans paying attention and that by 2022 they would achieve full self-driving ability in limited areas.
“None of that’s true,” he says now. “Profitable robo-taxis are still a decade away.”
Hotz thinks the automated vehicle industry has surrendered to what he views as the vices of modern Silicon Valley, focusing on growth and hype rather than delivering truly innovative products. To find out why he’s soured on the space and to take the Comma 2 for a test drive, I caught up with Hotz at the Airbnb Comma.ai rented off the Las Vegas Strip during CES, the largest consumer electronics show in the world.
Produced by Justin Monticello. Camera by Monticello, John Osterhoudt, and Jeffrey Cummings. Graphics by Lex Villena. Music by The 126ers, Matt Harris, MK2, Quincas Moreira, Jingle Punks, and Silent Partner.
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The Democratic establishment has officially shifted into panic mode. In 2016, they watched a bold political outsider shred a divided field of establishment Republican candidates on his way to winning the White House. Now they have one and only one shot of denying Donald Trump a second term, and the same thing that happened to the Republicans in 2016 is now happening to them. So far, Bernie Sanders is trouncing a divided field of establishment Democratic candidates, and that is a huge problem for party leadership for a number of reasons. For one thing, most top establishment Democrats absolutely detest Sanders. Secondly, most of them don’t believe that he has a prayer of actually beating Trump in November. So they are desperate to find a way to deny Sanders the nomination, but with each Sanders victory that is going to become increasingly difficult to do.
At this point, an all-out civil war has just about erupted on the left. Establishment Democrats are all in a tizzy about potentially nominating a “socialist”, but of course the truth is that America has been drifting toward socialism ever since FDR first entered the White House. Yes, there have been a few times when we have attempted to change course (the Reagan administration for example), but in general the federal government has just gotten bigger and bigger over the decades. Today we have the biggest government in the entire history of the planet, and the Democrats are primarily to blame.
Ultimately, what this conflict is about is power. Bernie Sanders may have won the hearts of the voters, but he isn’t supposed to actually win the nomination, and the Democratic establishment will pull out all the stops in order to keep that from happening.
All of a sudden, operatives on the left can’t stop talking about how the Russians want Bernie Sanders to win. This is coming from the same people that spent years trying to find evidence that President Trump colluded with Russian President Vladimir Putin during the 2016 election and that accused Tulsi Gabbard of being a “Russian operative” in order to derail her quest for the Democratic nomination.
Are there people out there that actually believe this stuff?
Apparently there must be, because establishment Democrats just keep going back to the same playbook over and over again.
In the weeks ahead, we should expect the attacks on Sanders to continue to escalate. The following are 11 of the most outrageous things that establishment Democrats have said about Bernie Sanders so far, but this is probably just the beginning…
#1Rahm Emanuel: “Putin and Trump are picking their opponent.”
#2Joe Biden: “The Russians don’t want me to be the nominee,” Biden said on CBS News’ “Face the Nation,” later adding, “they like Bernie.”
#3James Carville: “Right now, it’s about 1:15 Moscow time. This thing is going very well for Vladimir Putin. I promise you. He’s probably staying up watching this right now. How you doing, Vlad?”
#5Democratic House Majority Whip Jim Clyburn: “If you know how well we did the last time and look at the congressional districts, these are not liberal or progressive districts. These are moderate and conservative districts that we did well in. And in those districts it’s going to be tough to hold on to these jobs if you have to make the case for accepting a self-proclaimed democratic socialist.”
#6NPR’s Maria Hinojosa: “As somebody who has been around for a while…I want receipts. What has he done in all his time to actually deliver for Latino/a voters?”
#7Pete Buttigieg: “Before we rush to nominate Senator Sanders in our one shot to take on this president, let us take a sober look at what is at stake for our party, for our values and for those with the most to lose.”
#8Joe Lockhart: “In any political campaign, candidates need to know what they stand for, and who — or what — they’re up against. At this stage in the game for Bloomberg, that enemy is not Trump. It’s Sen. Bernie Sanders and the election calendar.”
#9James Carville: “If you’re voting for him because you think he’ll win the election, because he’ll galvanize heretofore sleepy parts of an electorate, then politically, you’re a fool.”
#10Hillary Clinton: “Nobody likes him, nobody wants to work with him, he got nothing done,” Clinton said of Sanders in a documentary about the campaign, released this year. “He was a career politician. It’s all just baloney and I feel so bad that people got sucked into it.”
#11MSNBC’s Chris Matthews: No pundit on the left has been more critical of Sanders than MSNBC’s Chris Matthews. In the aftermath of the vote in Nevada, Matthews actually compared the Sanders campaign “to the Nazi invasion of France in 1940″…
MSNBC’s Chris Matthews is under fire after comparing Sen. Bernie Sanders‘s (I-Vt.) decisive win in the Nevada caucuses to the Nazi invasion of France in 1940, with some on social media calling for the “Hardball” host to resign.
“I was reading last night about the fall of France in the summer of 1940,” Matthews said during MSNBC’s live coverage of the caucuses on Saturday. “And the general, Reynaud, calls up Churchill and says, ‘It’s over.’ And Churchill says, ‘How can that be? You’ve got the greatest army in Europe. How can it be over?’ He said, ‘It’s over.’”
Needless to say, that comment sparked a tremendous backlash.
In addition, Matthews suggested that the Democrats might be better off waiting four years and then putting in “a Democrat that they like”…
“I’m wondering whether the Democratic moderates want Bernie Sanders to be president. That’s maybe too exciting a question to raise. They don’t like Trump at all. Do they want Bernie Sanders to take over the Democratic Party in perpetuity?” he said.
“I mean, he takes it over, he sets the direction of the future of the party — maybe they’d rather wait four years and put in a Democrat that they like.”
Matthews must not understand that the only reason he has a job is because the radical left has embraced MSNBC over the years. Now Matthews and the other commentators on MSNBC are greatly alienating their core viewers, and that could potentially be absolutely disastrous for the network.
“You know, I have my own views of the word ‘socialist,’” Matthews said earlier this month. “They go back to the early 1950s. I have an attitude about them. I remember the Cold War. I have an attitude towards Castro. I believe if Castro and the Reds had won the Cold War, there would have been executions in Central Park, and I might have been one of the ones getting executed, and certain other people would be there cheering, OK? So, I have a problem with people who took the other side.”
This is coming from the same guy who was so giddy about the candidacy of Barack Obama in 2008.
Very strange.
In any event, I think that President Trump did a great job of summarizing the current state of the race for the Democratic nomination when he tweeted the following…
Looks like Crazy Bernie is doing well in the Great State of Nevada. Biden & the rest look weak, & no way Mini Mike can restart his campaign after the worst debate performance in the history of Presidential Debates. Congratulations Bernie, & don’t let them take it away from you!
None of the establishment candidates currently in the race has a prayer of winning enough delegates to secure the nomination before the convention.
So at this point the Democratic establishment has two options if they want to prevent Sanders from becoming the nominee.
Firstly, they can encourage everyone to stay in the race and try to divide the delegates enough ways so that Sanders cannot clinch the nomination prior to the convention. Then once the convention rolls around, they could try to put forward a “compromise candidate” as an alternative to Sanders.
Secondly, they could try to convince the one person that could actually beat Sanders during this process to enter the race. But Michelle Obama has said over and over again that she will absolutely not run for president. Unfortunately for the Democrats, she is probably the only one that could pull off such a miracle at this point.
Assuming that Michelle Obama is out of the picture, the Democratic establishment’s only hope of stopping Sanders is probably at the convention.
Usually the conventions are rather sleepy affairs, but this year might be an exception.
So you might want to stock up on popcorn, because a contested Democratic convention would be very strange, but it would also likely be very entertaining.
Harvey Weinstein was convicted of third degree rape and a criminal sexual act by a New York jury of seven men and five women, who took five days to reach their verdict. He faces up to 25 years in prison.
Weinstein was acquitted of predatory sexual assault, the most serious charge, and first degree rape.
The jury was deadlocked on the charge of predatory sexual assault, the most serious accusation against the disgraced 67-year-old Hollywood mogul, offering a glimpse into disagreements between jurors who had been deliberating in New York City over four days.
Jurors had told Judge James Burke in a note, “We the jury request to understand if we can be hung on 1 and or 3 but unanimous on the others.”
Counts 1 and 3 are charges of predatory sexual assault.
Count 2 is criminal sexual act in the first degree, count 4 is rape in the first degree, and count 5 is rape in the third degree.
Burke told jurors that any verdict that they returned must be unanimous and that if they cannot be unanimous on a specific criminal count then they cannot return a verdict for that count. –CNBC
According to the Wall Street Journal, “Predatory sexual assault requires jurors to agree that Mr. Weinstein carried out more than one sex crime and carries a sentence of up to life in prison.”
Weinstein was charged with one count of criminal sex act for allegedly forcible performing oral sex on former film-production assistant Miriam Haley in 2006, as well as first and third degree rape charges for allegedly forcing himself upon aspiring actress Jessica Mann in a Manhattan hotel room in 2013.
With Sen. Bernie Sanders now the clear frontrunner for the Democratic nomination for president, even some on the left have expressed worry over what a self-described Democratic Socialist on the ticket in November could mean not only for Democrats’ chances of taking back the White House but also for their down-ballot odds, namely, control of the U.S. House of Representatives and Senate.
Among Sanders’ most ardent supporters are college-aged voters, who favor the Democratic Socialist far more overwhelmingly than the broader electorate. However, from liberal MSNBC commentators Chris Matthews and Joy Reid to former Clinton campaign manager James Carville, a growing number of voices on the left are sounding the alarm, joining those with whom Campus Reform spoke more than a year ago.
At a Washington, D.C. protest, Campus Reform‘s Cabot Phillips spoke with individuals who escaped socialism in Venezuela to come to America.
WATCH:
“You do not ever want anyone, not even close, to socialism to come to this country,” one person said.
The same person specifically invoked Sanders’ name.
“Bernie Sanders is your enemy. Do not ever get involved with this individual or any of the other socialists,” he said.
“It is not the route to go. It is not possible. It is not feasible. Don’t fall for it,” another said.
“We also thought that this could never happen in our country,” one victim of socialism said about the economic system’s perils.
“We had a balance of powers. We had democracy and we elected our leaders.”
One person who said that he was born and raised in Venezuela said that he has seen the country “deteriorate” under socialism.
On Saturday, Sanders won the Nevada Democratic caucuses. The win follows his victory in the New Hampshire primary and his virtual tie for first place with former South Bend, Indiana Mayor Pete Buttigieg in Iowa.
Sanders’ wins in the first three contest states pave a clearer path for him to the Democratic nomination than for any other Democratic presidential candidate, although the South Carolina primary is just one week away, with Super Tuesday also quickly approaching.
