TRP Financial Services Report

Eric Cantor’s loss last week was described by some as yet another example of Republican’s “eating their own.” Unfortunately, liberals are also agitating in this way as well, and appear to be weaving the same narrative of creating “purity tests”, ironically with both sides taking aim at Wall Street.

While satirists lampooned that Cantor’s loss would have little impact on the Congress as an institution, it could be a wake-up call for “establishment Republicans” to embrace redistricting and election reform — starting by eliminating the anachronistic primary. Although initially created to break the stranglehold of the party boss on nominations, the primary is an institution that has outlived its usefulness. In Cantor’s case, even though he got crushed, only 65000 people out of a district of 758,000 voted.

This should not be surprising, as a Pew Research Center study released this week showed that our nation is more politically polarized than ever. As the Pew Study notes, people seem to like to live near other people who share their political views. Even if this trait is stronger amongst Conservatives than Liberals, it will result in polarized neighborhoods, but across the broader geography of a Congressional district could, with redistricting reform, result in more moderate districts. Today’s politicians are not “profiles in courage” and just want to get re-elected. Creating an open election system with a run-off and with less partisan gerrymandering would eliminate costly and unnecessary primaries while ensuring that members of Congress need to focus on appealing to a broader swath of their electorate. While not a return to the days of the smoke filled back room, it would create a Congress where members aren’t afraid about being “primaried” for talking to the other side of the aisle.

The full edition of this week's Thorn Run Partner's Financial Services Report is available here and below.