Everybody knows Howard Schultz isn’t going to become president and should stop running. What this piece presupposes is, maybe he doesn’t?
We will get back to Mr. Coffee in a moment. But first, a trip down memory lane. Do you remember that Newt Gingrich ran for President in 2012? You can be forgiven for not remembering. It would not surprise me if some of his immediate family members forgot, or never realized it in the first place.
In that year’s GOP nomination process, Gingrich showed remarkable staying power for a guy who performed terribly from start to finish. It was a wide-open race in which Republicans seemed to be searching desperately for anyone other than Mitt Romney. “Anyone” did not include Newt, alas.
Gingrich opened by finishing fourth in the Iowa Caucus and fifth in the New Hampshire primary, behind Jon Huntsman. He won the South Carolina primary, then lost by 14 percent in Florida.
Those were the high points. He won his home state of Georgia on Super Tuesday 2012. He lost every other state, often embarrassingly (finishing last, for example, in Minnesota). But Gingrich stayed in the race until May of that year. Usually a candidate who hangs on until near-summertime is in a Clinton-Obama 2008 scenario, winning tons of races and finishing strong seconds. Not so with Newt 2012.
Gingrich stayed, it turns out, because the presidential nomination process relies heavily on the free market to drive candidates out of the race. As readers will be stunned to discover, one billionaire can distort free market processes pretty easily.
What happens when money and failure are no object to a candidate?
Political scientists understand a “paradox of donations” in campaigns: generally, that candidates receive more donations when they are performing well and fewer donations when they are doing poorly. Nobody wants to waste money on a loser, but donors will happily hop on the bandwagon of a campaign that looks to be on its way to victory. Since a struggling campaign is more in need of money than a thriving one, the paradox is simple. Inevitably the faltering campaign, starved of donations and unable to reverse its downward slide, folds. Politicians have ambition, and it makes no sense to burn party bridges by refusing to yield. Dropping out and endorsing the front-runner keeps them in good graces.
In Gingrich’s case, though, ultra-right billionaire Sheldon Adelson all but single-handedly bankrolled his campaign beyond the point when it was no longer viable. He gave Gingrich at least $20 million, probably more. To a man like Adelson, that’s pocket change, and he was more than happy to flush it down the crapper to keep his preferred horse in the race. Gingrich, for his part, had no incentive to drop out so long as one guy was willing to keep paying his bills. Without Adelson’s cash he would have been forced to quit sooner.
Ultimately it did not matter; Gingrich was forced out. But this example demonstrates how easy it is for a person of great means to make a candidacy immune to the incentives the free market is supposed to enforce. Failure at the ballot box is supposed to drive candidates out of the field, accelerated by withering finances. What happens when money and failure are no object to a candidate?
This brings us to the present, and the yawning ideological void that is Howard Schultz.
The rise of the billionaire candidate—of which Trump is arguably an example, if he is in fact as wealthy as he claims—who cannot be controlled by party, donor, or interest group has some rhetorical appeal. Ominously, though, those candidates are also impervious to the existing mechanisms for making a candidate go away. Parties can declare such candidates losers in their primaries and caucuses, of course. But it turns out that if you don’t care about blowing your own money on an independent campaign, the electoral process has no way to nudge you out of the race. You can stay in forever, even if only to be a spoiler.
Let’s say Schultz—whose entire constituency appears to be pundits, political consultants, and people who list their favorite meal as white bread and tepid tap water—continues to poll in the low single-digits well into mid-2020. There’s no point in him continuing to run. But he might anyway, supposing someone he deems an “extremist” wins the Democratic nomination: Warren, Sanders, or another who might skew too far left on the Ideological Schultz-o-meter.
The hard truth is that while presidential elections are expensive, they’re not unaffordable for the very rich. Men and women worth billions could easily keep themselves in a race for two years at the cost of maybe $100-200 million, bearing in mind that Independents don’t have to win a nomination and their rich friends would certainly throw in a few bucks. For a Cuban,[*] a Zuckerberg, a Bezos, a Musk,[**] or any number of others, a quarter-billion dollars is a rounding error.
Schultz’s candidacy is, in effect, a gun held to the temple of the Democratic Party; nominate a Wall Street friendly centrist or the hostage gets it. Nominate someone the Hamptons class detests and I will peel off just enough votes to ensure you lose.
Or perhaps he’s egomaniac who will stay in the race simply for pride, or for fun, or for no reason whatsoever, just because. Someone with that much money can refuse to quit simply because nothing will force him to. We have a system in which the very rich could screw with our elections for their own ideological reasons or for no reason at all, just for fun.
If it works, and Schultz either dictates the Democratic nominee or plays spoiler for Trump, it certainly won’t be the last time it happens. Before long we will find ourselves in the odd position of wishing presidential elections were more, not less, expensive. But maybe there is no “too expensive” for billionaires where ego and the desire to protect elite privilege are involved, in which case we are well and truly boned. We created a system in which privately donated money is supposed to regulate the field of candidates: lose and we will stop contributing until you cry “Uncle.” And now it appears that the ultra-rich, shockingly, have found a loophole that excludes them from the mechanisms of the free market they so adore.
[*] Mark Cuban, not any person of Cuban descent
[**] Thankfully ineligible to serve as president