Les Echos : Le cadre des discussions se précise entre Orange et

Le cadre des discussions se précise entre Orange et Canal+

L’opérateur et la chaîne cryptée cherchent à aligner leurs intérêts. L’alliance devra aller au-delà d’un simple rapprochement commercial.

En décembre, Stéphane Richard, le PDG d'Orange, déclarait sa flamme à Canal+ :« Si Canal+ était à vendre, c'est certain qu'Orange s'y intéresserait », lâchait-il, lors d'un déplacement au Maroc. Deux mois après, aucun mariage n'a été conclu : « Canal+ n'est pas à vendre », affirme d'ailleurs régulièrement sa maison-mère, Vivendi. Cela n'empêche pas les équipes de la chaîne cryptée et de l'opérateur d'avoir depuis multiplié les discussions pour voir comment ils pourraient renforcer leur collaboration en imaginant une forme de rapprochement.

Dans un monde idéal, chaque camp mènerait peut-être seul sa barque mais Vivendi comme Orange ont intérêt aujourd'hui à unir leurs forces. Le premier parce que la relance de Canal+ reste fragile. Le second parce qu'il a besoin d'un Canal+ en forme pour pouvoir proposer à ses abonnés une offre de programmes audiovisuels riche. Or, Orange et Vivendi sont confrontés à un SFR de plus en plus agressif dans l'achat de contenus ce qui va obliger Canal+ à dépenser plus et Orange à se résigner à ne plus pouvoir offrir autant de contenus à ses clients.

Orange, prêt à investir avec Canal+ dans les droits sportifs

Et la situation a de fortes chances d'empirer car après avoir chipé à la chaîne cryptée les droits de la prestigieuse Premier League de foot, l'opérateur contrôlé par le tycoon Patrick Drahi compte monter en puissance dans les droits sportifs et va commencer à financer des séries et des films . Et, si Canal+ est affaibli, Orange risque de devenir, de fait, moins attractif, face à SFR, son principal rival dans les télécoms en France.

Les deux groupes se connaissent bien : Orange est le premier distributeur de Canal+ et tous deux ont enrichi leur partenariat à l'automne en proposant aux abonnés fibre d'Orange un bouquet de chaînes, « Famille by Canal ». Mais, il faut maintenant aller plus loin. D'abord en favorisant le rebond commercial de Canal, ensuite en aidant la chaîne à investir dans ses programmes. « Aujourd'hui, nous avons des discussions avec Canal+ sur les appels d'offres de sport, pour voir comment on pourrait les aider, y compris financièrement », révèle une source proche d'Orange.

SFR met la pression

Il n'y a pas de temps à perdre : les droits télé de la Formule 1 et la Ligue des Champions, deux compétitions que diffuse Canal+, vont être remis en jeu avant l'été. Sans compter la Ligue 1 de foot, dont les droits arrivent à échéance en 2019. A coup sûr, SFR va postuler . « Il est évident que nous allons continuer à étudier tous les droits sportifs disponibles », clamait ainsi Michel Combes, DG d'Altice, la maison-mère de SFR, vendredi, lors d'un déjeuner avec l'Association des journalistes médias. « Nous sommes dans le sport pour construire, pas pour faire un aller-retour. »

Pas question, cependant, pour Orange d'aider Canal+ sans être associé à la création de valeur. Difficile donc de n'être qu'un simple actionnaire minoritaire de Canal ou de Vivendi. Peu probable, à l'inverse que Vincent Bollor é qui cherche à relancer Vivendi comme un grand acteur des médias depuis qu'il en a pris le contrôle, accepte de vendre la totalité de Canal+ à Orange.

Points de blocage

Pour aligner les intérêts des deux groupes, l'une des pistes évoquées consisterait à créer une nouvelle société de commercialisation pour Canal+ en France. Une société dont Orange serait l'actionnaire majoritaire. En parallèle, les deux groupes qui sont présents en Pologne comme en Afrique pourraient imaginer d'autres collaborations.

Si le cadre des discussions, plus ou moins formelles, se précise aucun schéma capitalistique ne serait pour l'instant arrêté. Plus que l'élection présidentielle, qui selon plusieurs acteurs de ce dossier, n'empêcherait pas une alliance entre les deux groupes, certains points de blocages potentiels subsistent. Un tel rapprochement poserait tout d'abord des questions sur un plan concurrentiel. L'Autorité de la concurrence exigerait des contreparties pour s'assurer que Free, Bouygues et SFR aient bien accès aux contenus de Canal et d'Orange, ce qui pourrait faire perdre en partie de son intérêt à une telle alliance.

Vivendi pourrait s'inviter au capital d'Orange

Surtout, Orange comme l'Etat-actionnaire, ne semblent pas vouloir qu'une alliance avec Vivendi ne permette à Vincent Bolloré de s'inviter au capital de l'opérateur historique dont il pourrait chercher ensuite à prendre le contrôle de manière rampante. Or, payer une entrée au capital ou un rachat de Canal en actions comme en cash ouvrirait la porte d'Orange à Vincent Bolloré qui pourrait acquérir ainsi directement ou indirectement des actions de l'opérateur.

Interrogé, fin janvier, lors de la présentation de ses voeux, par ses salariés, inquiets d'une telle hypothèse, Stéphane Richard leur avait répondu: « On a tort de faire le raccourci entre l'intérêt industriel que pourrait représenter l'acquisition de Canal+ et l'arrivée de Vivendi dans le capital ou de Vincent Bolloré. On peut très bien faire l'acquisition de Canal+, je dis tout de suite que ce n'est pas le projet, en la payant en cash. » Et d'ajouter, sans citer de nom: « J'ai quelques idées sur la typologie des actionnaires qu'on pourrait être amené à accueillir au sein du capital d'Orange. Certains me paraissent rentrer dans les valeurs de l'entreprise plus que d'autres. ».

Un accord entre Orange et Vivendi-Canal+ ne semble pas imminent mais tous les acteurs connaissent maintenant le cadre des discussions et la perte de certains droits majeurs - comme la F1 ou d'autres - pourraient bien provoquer une accélération du traitement de ce dossier.




Les Echos : The framework of the discussions is clear between Orange and Canal +

The framework of the discussions is clear between Orange and Canal +

The operator and the encrypted channel seek to align their interests. The alliance will have to go beyond a mere commercial rapprochement.

In December, Stéphane Richard, CEO of Orange, declared his flame to Canal + : "If Canal + was for sale, surely Orange would be interested," he said, during a trip to Morocco. Two months later, no marriage was concluded: "Canal + is not for sale," his mother, Vivendi, regularly says. This does not prevent the teams of the encrypted channel and the operator from having multiplied the discussions to see how they could strengthen their collaboration by imagining a form of rapprochement.

In an ideal world, each camp might lead its own boat, but both Vivendi and Orange are interested in joining forces today. The first because the revival of Canal + remains fragile. The second because it needs a Canal + in form to be able to propose to its subscribers a rich offer of audiovisual programs. Orange and Vivendi are facing an increasingly aggressive SFR in the purchase of content, which will force Canal + to spend more and Orange to resign itself to not being able to offer so much content to its customers.

Orange, ready to invest with Canal + in sports rights

And the situation is likely to worsen because after chipping the encrypted channel the rights of the prestigious Premier League football, the operator controlled by tycoon Patrick Drahi hopes to rise in sports rights and will begin to finance Series and films . And, if Canal + is weakened, Orange is likely to become less attractive, in the face of SFR, its main rival in telecoms in France.

The two groups know each other well: Orange is the first distributor of Canal + and both have enriched their partnership in the fall by offering Orange fiber subscribers a bunch of channels, "Famille by Canal". But now we have to go further. First, by helping Canal trade rebound, and then helping the channel to invest in its programs. "Today we have discussions with Canal + on sports tenders, to see how we could help them, including financially," reveals a source close to Orange.

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SFR puts the pressure

There is no time to lose: the TV rights of the Formula 1 and the Champions League, two competitions that diffuse Canal +, will be put back into play before the summer. Not to mention the Ligue 1 football, whose rights expire in 2019. SFR will certainly apply . "It is clear that we will continue to study all the sports rights available," said Michel Combes, CEO of Altice, the parent company of SFR, on Friday at a lunch with the Association of Media Journalists. "We are in the sport to build, not to make a round trip. "

No question, however, for Orange to help Canal + without being associated with creating value . Difficult therefore to be a simple minority shareholder of Canal or Vivendi. Unlikely, on the other hand, Vincent Bollor , who is trying to revive Vivendi as a major actor in the media since he took control of it, agrees to sell the entire Canal + to Orange.

Blocking points

To align the interests of the two groups, one of the avenues would be to create a new marketing company for Canal + in France. A company of which Orange would be the majority shareholder. At the same time, the two groups that are present in Poland as in Africa could imagine other collaborations.

If the framework of the discussions, more or less formal, is defined no capitalist schema would for the moment be stopped. More than the presidential election, which according to several actors of this file, would not prevent an alliance between the two groups, some points of potential blockages remain. Such a reconciliation would initially raise questions on a competitive level. The Autorité de la concurrence would require counterparties to ensure that Free, Bouygues and SFR have access to the content of Canal and Orange, which could lose some of its interest in such an alliance.

Vivendi could invite itself to the capital of Orange

Most notably, Orange as the shareholder state , do not seem to want an alliance with Vivendi to allow Vincent Bolloré to invite himself to the capital of the incumbent operator, which he could then seek to take control rampant. Paying an entry into the capital or a buy-back of Canal shares and cash would open the door of Orange to Vincent Bolloré who could thus acquire directly or indirectly shares of the operator.

Asked at the end of January when his wishes were expressed by his employees, who were worried about such a hypothesis, Stéphane Richard replied: "It is wrong to make the shortcut between the industrial interest that could be Canal + and the arrival of Vivendi in the capital or Vincent Bolloré. We can very well acquire Canal +, I say right away that it is not the project, by paying it in cash. "And to add, without mentioning a name:" I have some ideas on the typology of shareholders that could be brought to welcome within the capital of Orange. Some seem to me to fit into the values ​​of the company more than others. ".

An agreement between Orange and Vivendi-Canal + does not appear to be imminent, but all parties are now familiar with the framework of discussions and the loss of certain major rights - such as F1 or others - may well lead to faster processing of this file.

NYT : A Baby Formula Deal’s Success Depends on China

A Baby Formula Deal’s Success Depends on China

The success or failure of Reckitt Benckiser’s $17 billion deal will be decided in China. Britain’s cleaning-products-to-condoms group is giving $90 a share in cash for the American baby formula-maker Mead Johnson. Cost savings justify only around half of the $3.8 billion premium, though. Making up the balance depends largely on increasing sales in the People’s Republic.
Reckitt Benckiser, valued at $64 billion, unveiled its deal with Mead on Friday, just over a week after confirming that the two were in talks. It expects the tie-up to generate around $250 million of annual cost savings after three full years, mainly by merging the companies’ back offices and driving a harder bargain with suppliers.
Taxed at 25 percent, those savings are worth about $1.9 billion in today’s money — half the value of the 30 percent premium that Reckitt is handing to Mead shareholders. Add the savings onto Mead’s expected earnings for 2020, and the return on Reckitt’s total investment is just over 5 percent — short of the 7 percent cost of capital typical for a large consumer goods group. Reckitt, run by Rakesh Kapoor, says the purchase will exceed its cost of capital after five years. That will depend on increasing sales in the $46 billion global infant nutrition market.
On paper, prospects are bullish. Chinese children will be responsible for around half of the global growth in milk formula sales in the next five years, according to Euromonitor. China’s decision to relax its one-child policy and the increase in women reaching for baby formula as they head out to work should bode well for Mead.
Yet it is also a hugely fragmented market, with around 2,000 baby food brands, many of which are aggressively cutting prices. Food safety scandals have made middle-class buyers in China wary of buying domestically. A government crackdown on informal imports of baby formula via Hong Kong hurt Mead’s sales in Asia in 2016.
The American company is struggling to adapt as new regulations push sales online. Reckitt, which generates nearly a third of its China revenue online, should help to get Mead’s e-commerce offering up to scratch. Reckitt’s reaching its financial targets depends on it.

FT : Generali targets deeper cuts in attempt to stay independent

Generali targets deeper cuts in attempt to stay independent 
Italian insurer shores up defences against potential bid from country’s largest bank

Italian insurer Generali is planning to raise its cost-cutting target in an effort to defend itself against a potential bid from Intesa Sanpaolo, the country’s largest bank by market value.

The mooted deal would reshape Italian finance, creating a financial colossus in Italy with a combined market value of €60bn, dwarfing Intesa’s nearest rival UniCredit and resurrecting the controversial bancassurance model.

Generali, which has not been approached directly by Intesa, is critical of the strategic logic of the deal.It has already promised to cut €200m, or 4 per cent, off its cost base in mature markets by 2019. But people familiar with its thinking say it plans to propose deeper cuts as it tries to persuade shareholders to back its independence.

They said any increase in the target for cuts would be modest. One person who has advised on the issue said the final number was likely to be 6 or 7 per cent, but still well short of proposals for radical cuts of up to 20 per cent made by some advisers.

The move by Generali comes after Carlo Messina, Intesa’s chief executive, met many of the bank’s biggest investors in the past week seeking to convince them of the logic of his plan to boost Intesa’s asset management business by acquiring the insurer.

Mr Messina told investors he wants a “friendly merger” and plans to approach both Generali and the insurer’s core investors, including Italian investment bank Mediobanca and several Italian billionaire industrialists, say people briefed on those meetings.

This tactic is seen by some people as an attempt to prepare the ground for Intesa to make a bid at a low premium as Mr Messina has pledged to his investors that any deal would not hurt its capital position or dividend prospects.

Intesa has already ruled out an all-share swap, bankers say because this would result in Mediobanca, Generali’s largest shareholder with a 13 per cent stake, becoming one of Intesa’s top investors.

Mr Messina, who is well connected politically, has told colleagues that he wants to publicly announce whether he will proceed with an offer for the insurer by the end of this month. Generali is working plans to unveil its new cost cuts next month.

Generali, which controls €500bn in assets, is considered a key asset in Italy as it is a major buyer of national debt. Intesa’s mooted approach is being watched closely in Rome, and welcomed in some quarters amid rising fears of foreign takeovers of Italian companies. The insurer ruffled feathers in the Italian establishment recently by refusing to support bank rescues such as the latest Atlante fund.

Pier Carlo Padoan, Italy’s finance minister, has told parliament that Rome is in favour of Generali remaining Italy-based and retaining an international reach, a statement taken as equally supportive of Generali remaining independent and an Intesa-led takeover.

While there has been speculation that Intesa would look to break up Generali — potentially selling its German and French arms to foreign rivals — the Italian bank is now keen to preserve the insurer’s presence in core countries including Italy, France, Germany and China.

Alberto Nagel, Mediobanca’s chief executive, fanned speculation of a deal last week by telling analysts he had sold some Generali shares last year at €17 to €18 each. Nonetheless, Mr Nagel also said the bank was sticking to its plans to sell only 3 per cent of the insurer by 2019.

Shares in Generali have gained 20 per cent in the past year, boosted by takeover speculation. But over a five-year period they have lagged behind those of European rivals Axa and Allianz by about 60 per cent.

FT : Energy groups point to green policies for bill rises

Energy groups point to green policies for bill rises
Government initiatives add £134 a year per household, says power group

UK households face a 42 per cent rise in the amount they pay to support government green energy initiatives, according to an analysis by one of the UK’s big independent power suppliers.

Consumers help fund the provision of smart meters that reduce electricity use and subsidy schemes to encourage low carbon technology through their energy bills. First Utility, one of the UK’s biggest independent energy suppliers has calculated that the cost of funding these and other schemes will rise to £134.20 per customer per year from April, up from £94.50 in the previous year.

At present, a typical “dual fuel” bill for gas and electricity for customers on the most common standard variable tariff is about £1,088 a year. 

The biggest renewable subsidy cost to consumers is from “renewables obligation certificates” — a support scheme for large renewable energy projects. According to First Utility's analysis, it accounts for £68.80 of the £134.20 total. 

The renewables obligation scheme will close to all new generating capacity at the end of next month but the costs of other schemes — such as the “capacity auctions” that the government runs to buy guaranteed power generation during periods of high demand — are also rising.

All three of the big six energy providers that have so far announced price rises this year — Npower, EDF Energy and ScottishPower — have cited an increase in compulsory costs such as delivering government policies, as well as rising wholesale prices, for their decisions.

Darren Braham, co-founder of First Utility, said there was not always a “huge amount of transparency” about the cost to consumers of energy policies.

But the industry’s case is unlikely to damp political and consumer anger over household energy bills. Wholesale costs have risen but Centrica, a big six provider that owns British Gas, still managed to extend a freeze in bills for customers on its standard energy tariff until August.

The Department for Business, Energy and Industrial Strategy praised British Gas and said price rises by other power suppliers were “completely unacceptable”.

Ofgem, the energy regulator, has said it sees no “obvious” reason why bills should rise, because large suppliers buy energy as much as two years in advance.

The energy market is expected to feature in a government green paper discussion document to be published in the spring on markets that are “not functioning fairly” for all consumers.

Gillian Guy, chief executive of the Citizens Advice charity, said: “We see little reason why suppliers can’t choose to hold off raising bills for loyal customers on the standard tariff — British Gas has shown this is possible.”

First Utility has proposed that customers who have remained on expensive standard rates for a number of years should be automatically transferred on to their supplier’s cheapest rate.

FT : Swiss voters seen to reject corporate tax reforms

Swiss voters seen to reject corporate tax reforms
Initial estimates suggest 60% have rejected proposal in referendum

The future attractiveness of Switzerland’s corporate tax regime has been thrown into doubt after initial estimates suggested that Swiss voters had decisively rejected reforms aimed at bringing the country’s practices in line with international standards.

The government in Bern had hoped to secure approval for changes which would have kept corporate tax rates low but abolished special treatment given to many multinational companies.

In a referendum on Sunday, however, the plan was rejected by 60 per cent of voters, according to estimates by the SRF, the public broadcaster — a much larger margin of defeat than opinion polls had suggested.

Bern and the Swiss cantons now face a scramble to rethink the proposals in the face of threats that important trading partners could take retaliatory action.

Ahead of Sunday’s vote, Switzerland was warned that failure to dismantle practices considered harmful by other countries could result in an international backlash. “Switzerland’s partners expect that it will implement its commitments in a reasonable timeframe,” Pascal Saint-Amans, head of tax at the Paris-based OECD, told the Financial Times.

The defeat is a blow for the business lobby in Switzerland, which argued that failure to agree on the reforms would create damaging uncertainty over their future tax bills. It suggests that the global anti-establishment mood has reached Switzerland, as the reforms had been backed overwhelmingly by the two chambers of the Swiss parliament as well as the government, with opposition largely from leftwing parties.

Since the second world war, multinationals and trading companies helped the small Alpine economy become one of the world’s most successful economies. Under the reform plans, the country’s 26 cantons would have continued to compete to offer companies the most favourable tax rates, but multinationals would have paid the same rates as other businesses.

To avoid imposing much larger bills on multinationals, the cantons announced plans to slash corporate tax rates for other companies, while the federal government in Bern said it would help fill shortfalls in tax revenues.

Switzerland embarked on the reforms following pressure from the EU as well as the OECD. Opponents led by the Swiss Social Democratic party argued, however, that the new system would have been too generous to business and led to large gaps in cantons’ budgets, which in turn would have hit public services.

Further alienating voters was a complex system of internationally acceptable tax reliefs which would have been available under the new system, for instance for research and development or income from patents and on shareholders’ equity. Critics argued the new regime would have simply boosted the income of tax advisers, lawyers and shareholders.

Opponents also argue the reforms could be modified relatively easily — a point disputed by supporters, who say the package took years of careful negotiation between the cantons and federal government.

They also clashed with supporters of the reforms over the economic impact of the reforms, with those in favour arguing that by securing Switzerland’s competitiveness, they would boost jobs and investment. Critics pointed out that multinationals liked Switzerland because of other factors — including its high quality transport infrastructure and skilled workforce.

NY Post : Deal-makers looking to network with Kushner-Trumps head to ski weekend


Media banker Aryeh Bourkoff is scheduled to kick off his annual “Media Winter Ski Weekend” Sunday.

The event is the place to be for media deal-makers who might want to rub shoulders with the Kushner-Trumps.

The Deer Valley, Park City, shindig will see IAC/InterActiveCorp boss Barry Diller mingling with John Malone’s Liberty Media mafia: Greg Maffei and Mike Fries.

It’s unclear at press time if Jared Kushner will be with his wife Ivanka on the slopes this year — On the Money hears she will stay in the nation’s capital with the kids. But sources believe Jared’s bro Josh Kushner is expected.

Well-connected Full Picture CEO Desiree Gruber is also on the list to attend, as is A&E Networks Chief Executive Nancy Dubuc, fresh off a deal to make shows for Snapchat.

MediaLink CEO Michael Kassan will be there raising a glass to his new owners — his firm was sold last week to Britain’s Ascential, which owns the Cannes Lions creativity festival.

It’s unclear how many of the 70 high-flyers will be attempting the double black diamonds on the slopes, but we bet there’ll be plenty of gossip to go around.

Bourkoff has been in the midst of a large number of media marriages from Verizon/AOL to Charter/Time Warner Cable.

(TechCrunch) Data shows a downward demographic spiral for Republicans

Data shows a downward demographic spiral for Republicans

Since taking the presidency by surprise back in November, the Republican Party has been salivating on the unexpected opportunity laying before them — control of the White House and both chambers of Congress.
Even with the oddly unconventional behavior of the newly elected President Trump for them to juggle, Republicans recognize a mostly unobstructed opportunity to do what they like for at least the next two years.
This situation is a far cry from the 2013 post-election autopsy and self-diagnosis produced by the Party in the aftermath of the 2012 election. The report, a post-mortem designed to identify what had gone wrong in Mitt Romney’s 2012 defeat, also served as a prescription for how to recalibrate and move forward. Much of the report focused on needed outreach to women and minorities, immigration reform, and softening language to become a more inclusive and tolerant party.
But that 2013 game plan has since been shoved to the back of the Republican junk drawer. Republicans are celebrating their victory, and sharpening the knives to make good on Trump campaign promises — even the really questionable ones.
Lost on the Party during this, however, would seem to be that they are statistically experiencing the ultimate political “dead cat bounce”.
The term comes from stock markets and refers to a sequence of events where a stock sees a temporary and brief recovery after a severe and prolonged decline, followed by a return to that same decline. The short recovery was really just a mirage as the underlying problems still exist, returning the stock to its initial, inertial freefall.
The key to understanding this phenomenon for the Republican Party is to look at changing U.S. demographics.
Minorities increasingly comprise larger shares of the U.S. population with Hispanics and African-Americans currently making up 17.6% and 13.3 % of the population, respectively. When accounting for all minorities in the U.S., whites now make up just 61.6% of the population.
And that last percentage is shrinking. The U.S. Census Bureau now estimates that by 2044, no race or ethnicity in the U.S. will represent a majority of the population…and that includes whites. This sort of rapidity of a country’s population composition changing seems to be unprecedented.
The impact of this change has certainly been felt in recent elections. Local and state-level elections in regions with significant minority populations have consistently moved Democratic, and there is no real indication to believe this is changing anytime soon. It’s also been true at a national level. In this past November’s Presidential election, Democrats benefited from 89% and 66% of African-American and Latino votes, respectively.
So what’s propping up the Republican Party right now, allowing them to sneak in a surprise like Donald Trump against all expectations? The easy (and lazy) answer is that it must be that the 62% of whites are still voting overwhelmingly for Republicans, offsetting these growing demographic changes. Though there is truth to that, digging a bit deeper shows it turns out to be a much more nuanced situation than just that.
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Most striking in this is that though whites currently only make up just shy of 62% of the U.S. population, they accounted for 71% of all voters this past November. The takeaway here is that white voters are having a disproportionate effect on the outcome of the election vs. other predominant American races and ethnicities. As a whole, they are clearly taking their civic duty and constitutional privilege very seriously (or suppressing the vote of other ethnicities).
Furthermore, when you look at exit polling data, white voters as an entire group went fairly heavy to the Republican Trump over Democrat Hillary Clinton, 57% to 37%. The 20% margin of victory coupled with that extremely high 71% of the overall voting pie, was enough to offset Democrats strong performance among minority voters and narrowly eke out an electoral college win for President Trump. A win largely determined by the unexpected upsets in Michigan, Pennsylvania, and Wisconsin.

Here’s where this demographic math gets interesting. One of the single largest segments within the white voter demographic are white evangelical voters. White evangelicals made up close to 37% of all white voters at the polls in November and a striking 26% of total voters.
This is particularly compelling because recent studies have shown that white evangelicals (and even white protestants more broadly) are generally decreasing as a percent of the U.S. population each election cycle (largely driven by the fact that younger generations are less religious, or at least less strident in their religion than older generations). Yet, the 26% of voters this year is consistent with the past couple elections and actually up from levels in the 1990’s and early 2000’s.
Not only are white evangelical voters incredibly loyal to the Republican Party, but increasingly so. In the 1996 and 2000 elections, white evangelicals broke for Republicans 65% and 68%, respectively. From 2004-2012, that figure was in the mid-to-high 70% range. In 2016, an overwhelming 80% of white evangelicals voted for the Republican Trump.
But at the same time that Republicans are having a very challenging time courting minority voters, it appears they are also struggling with the rest of white America – the non-evangelical whites – which is clearly much larger in size. In the 2016 election, non-evangelical whites comprised 63% of the total white vote and 45% of the overall vote….and it turns out they broke for the Democrat Clinton by a healthy 6% margin.
White evangelicals have done a tremendous and even historic job of propping up the Republican Party in the face of substantial demographic and ideological shifts in the nation. But implicit in all this data is that Republicans may have finally exhausted the segment that’s been most reliably carrying them in recent elections.
Given that the percent of the population that identifies as white evangelical is shrinking, while at the same time the portion that is showing up in the voting booth is increasing, there may not be many more white evangelicals for the Republican Party to lure to the voting booth. Of the estimated 41M that are voter eligible, an estimated 35M voted in 2016 for an astonishing 85% turnout rate.
Democrats are licking their wounds trying to understand themselves what went wrong in 2016 – and they need to. There’s a lot to digest and they have their own major issues to address.
It’s clear Republicans hitched their wagon to a demographic they have successfully exploited at historic levels the last couple of decades. Yet in doing that they’ve still lost six of the last seven popular votes, and as the data shows they’ve now pretty much run out of white evangelicals to add to the mix.
And short of a massive religious revival in America that restocks the pond, Republicans run the risk Trump’s victory will conceal what they likely figured out four years ago – that 2020 and beyond look to be mathematically ugly given America’s changing demographics.
Yet, surprisingly President Trump appears to be doubling down on this exact group that is already saturated and holding them back. At the National Prayer Breakfast meeting in Washington last week, Trump committed to “totally destroy” the 63-year-old Johnson Amendment, which bars churches from engaging in political activity or risk their tax-exempt status.
With the landmines Republicans are now navigating on a daily basis (thanks to the policies of the current administration), plus their own buzz over a temporary restoration of power, time will tell if they end up neglecting an acutely serious Party inclusion issue that could have real long-term effects.

FT : A failure to tell the truth imperils Greece and Europe

A failure to tell the truth imperils Greece and Europe
If the IMF pulls out, Europe will be free to mismanage the crisis on its own

Failure to tell truth to power lies beneath much of what is going wrong in Europe right now. It may not be the principal cause of the Greek debt crisis, which is now on its umpteenth iteration. But it is more than a mere contributing factor.

You notice it particularly at those moments when others speak the truth, as the staff of the International Monetary Fund have done recently. In its latest survey of the Greek economy it states that “public debt has reached 179 per cent [of gross domestic product] at end-2015, and is unsustainable”.

Europeans are not used to such bluntness. The Germans protested. The European Commission protested. So did the Greeks. They all want to keep up the fairy tale of Greek debt sustainability for a little while longer.

They were particularly shocked that the IMF exposed the disagreement when it wrote that “some directors had different views on the fiscal path and debt sustainability”. These were the Europeans, who are now in a minority in the fund.

Once the Trump administration sends its representatives to the IMF board, expect the climate to become even more hostile. My expectation is that the IMF will ultimately pull out of the Greek programme, leaving the Europeans free to mismanage the ongoing Greek crisis on their own.

How did it come to this? In July 2015, the EU and Greece agreed a third bailout. Alexis Tsipras, Greek prime minister, committed himself to running a primary surplus (before the payment of interest) of 3.5 per cent of economic output each year.

No country has ever managed to maintain such a commitment over an almost indefinite period. Greek debt sustainability was thus premised on an obviously unfulfillable assumption. Greece is not only far away from achieving a 3.5 per cent primary surplus. It will never do so.

Another untold truth is that Germany will never forgive Greek debt. This is because the German parliament will not accept it, and the number of MPs hostile to Greek debt relief will be even higher after the September election.

If the German government wanted to accept debt relief measures, it could probably assemble a parliamentary majority today. The “grand coalition” led by Chancellor Angela Merkel commands about 80 per cent of the seats in the Bundestag. But with the September elections, I would expect the Free Democrats, the liberal party, to re-enter the parliament after they failed to clear the hurdle last time. Their leader, Christian Lindner, said last week that the best way forward is for Greece to leave the eurozone, and for Greek debt to be forgiven afterwards.

Alternative for Germany, the rightwing anti-European party, not only wants Greece out of the eurozone, but Germany as well. Together those two parties will probably account for some 20 to 25 per cent of MPs. If you add the large group of Eurosceptics from Ms Merkel’s Christian Democratic Union and its Bavarian sister party, the Christian Social Union, it is not hard to see why the window for debt relief will close permanently this autumn.


What is particularly galling about this story is the complicity of the Greeks themselves. There are no good and bad guys in this story. In the spring of 2015, in the months following Syriza’s election victory, Mr Tsipras’ government took the position that a fiscal surplus of 3.5 per cent is economically counterproductive and politically suicidal.

In the end he chose to cave in to European demands, and accepted the 3.5 per cent target. He then committed the catastrophic mistake of aligning himself with the EU against the IMF, the only institution that advocated debt relief. It was a political miscalculation. He thought the target was soft, like so many other European benchmarks. And he thought he could always compromise with the Europeans on structural reforms. He also miscalculated in assuming that the IMF would be complicit in such a deal.

A much overlooked part of the Greek bailout programme is that Germany made its participation conditional on IMF involvement. That gave the fund leverage. If the IMF now pulls out of Greece, one of two things will happen. Athens will either default on its debt this summer and be forced to quit the eurozone, or Berlin will accept debt relief just a few months before the elections. Either way, this is a fight in which someone ends up on the floor.

The Greek crisis is only the most glaring example of failure to tell the truth. There are many others. Italy’s membership of a monetary union with Germany is also transparently unsustainable. Yet no Italian prime minister has ever mounted a credible challenge to the way the system is governed.

When the truth dies, we should not be surprised if alternative facts are put in its place.