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America’s ailing political parties

A report by The Economist Intelligence Unit

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America’s ailing political parties


Executive summary 2

The Democrats: Rust Belt or Sun Belt? 4

The Republicans: governing sucks 8

© The Economist Intelligence Unit Limited 2017 1

America’s ailing political parties

Executive summary

W ith less than a year until the 2018 mid-term elections, the US’s two political parties are
struggling. Polling in November 2017 showed that only one-third of voters approved of the
Democratic Party’s performance in Congress (the legislature). For the Republican Party, it was just
one-fifth. The Republicans’ position appears commanding: it occupies the White House, has majorities
in both chambers of Congress, a formidable number of state governorships and legislatures and has
the reassurance of a right-leaning Supreme Court. Yet the party is on the brink of civil war. The party’s
senators cannot agree on how the government should be run, what sort of reforms it should pursue or
what the future of America should look like. All but one of the Republican senators up for re-election
in 2018 will face primary challenges from the party’s insurgent right wing. The more of these that are
successful, the deeper these party divisions will become.
The president, Donald Trump, and Republican congressional leaders have no functioning
relationship, with each privately (and occasionally publicly) blaming the other for the government’s
lack of progress. The obstructionism employed so effectively during the presidency of Barack Obama
has become difficult to shift. The administration’s few successes have come when it has focused on
dismantling Mr Obama’s legacy, rather than building its own record. Unless there is a dramatic and
unlikely shift in momentum in the next 12 months, the administration and the Republican-held
congress will head into the mid-terms with record-low approval ratings.

Congressional net approval rating


100 9/11 terrorist attacks 100

80 Republicans expand majorities in House and Senate at mid-terms 80
60 Democrats win back House and Senate 60
40 Financial crisis stimulus package passed 40
20 Republicans take back the House
0 0
Obamacare passed
-20 Federal government -20
-40 -40
-60 -60
-80 -80
Republicans control the Senate again
-100 Republicans keep hold of both chambers -100
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Source: Gallup.

Yet the Democrats are in a weak state to capitalise on the Republicans’ travails. The party is still
working through the convulsions of the primary campaign in 2016, when a crotchety democratic
socialist, Bernie Sanders, ran a surprisingly close race against the consummate insider, Hillary Clinton.

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America’s ailing political parties

Mrs Clinton’s unexpected and shattering defeat to Mr Trump stripped her and the Democrats’ centrist
leadership of their authority. The party remains split between those seeking to push a left-wing
economic message of more corporate regulation and stronger workers’ rights and those who want to
push identity issues and reassemble the broad coalition of black, Hispanic and female voters that put
Mr Obama in the White House.
The party also faces some structural impediments. The electoral calendar is unkind: the party has
control of 25 of the 33 Senate seats to be contested at the mid-terms, which will make strengthening
their current position challenging. Meanwhile, the gerrymandering of political districts in the
House of Representatives (the lower house) carried out by Republicans after the 2010 mid-terms
puts the Democrats at a distinct disadvantage. Independent estimates have suggested that the gap
between the Democrats’ vote share and their proportion of House seats in 2018 could be as wide as six
percentage points. Even if the party was to perform better than in 2016, the improvement may not be
reflected in Congress.
In this report The Economist Intelligence Unit assesses the health of America’s two political parties
and considers how this will affect their performance at the 2018 mid-terms. We believe that the House
is firmly in the balance. The Democrats will pick up seats, but they will continue to accumulate wasted
votes in urban centres; a consequence of their metropolitan message and dubious redistricting. The
Republicans’ hold on the Senate looks much more secure, despite the additional risk posed by primary
contests in several seats. It would take a political shock, beyond what we have seen so far during the
Trump administration, for control of the upper chamber to be handed back to the Democrats.

© The Economist Intelligence Unit Limited 2017 3

America’s ailing political parties

The Democrats: Rust Belt or Sun Belt?

T he night of Tuesday November 8th 2016 was catastrophic for the Democratic Party. Not only
was Hillary Clinton defeated by Donald Trump, but the party failed to capture either chamber
of Congress. It gained only six of the 36 seats it required in the House of Representatives (the
lower house) and only two of the seven seats in the Senate (the upper house). It lost two state
governorships, taking its total down to its lowest since 1922. It also gave up 46 seats in state
legislatures, so that it held 3,129, compared with the Republicans’ 4,170. Mrs Clinton’s defeat and the
end of the Obama presidency also pushed two decades of Democratic leadership into retirement.
There were many reasons for the Democrats’ humbling. At the top of the list was the candidate
herself. Mrs Clinton appeared to have some formidable advantages: huge name recognition,
unparalleled fundraising capabilities and an extraordinary appetite for policy detail. But each of
these proved to be weaknesses. Too many Americans had already made their mind up about her,
lucrative speaking fees gave the impression that she was in the pocket of Wall Street, and a genuinely
progressive manifesto failed to translate into simple promises on the stump. According to a veteran
Democratic pollster, Stanley Greenberg, Mrs Clinton stuck too closely to Mr Obama. Although
the economy strengthened under Mr Obama, the recovery left many behind. Mrs Clinton did not
promise to rescue these people; instead she pledged continuity. For many Democrat-leaning voters,
they recognised the broken society described by Mr Trump, rather than the blue skies painted by
Mrs Clinton.

Household income
($'000, 2016 dollars)
10th percentile 50th percentile (median) 90th percentile
180,000 180,000

160,000 160,000

140,000 140,000

120,000 120,000

100,000 100,000

80,000 80,000

60,000 60,000

40,000 40,000

20,000 20,000

0 0
1967 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 2001 03 05 07 09 11 13 14 16
Source: US Census Bureau.

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America’s ailing political parties

Organisational weaknesses also played a role. Heading into the 2016 election campaigns, the
Democratic National Committee (DNC, the party’s governing body) was deeply in debt. Its chair, Debbie
Wasserman-Schultz, was ineffective and unpopular. Mr Obama paid little attention to the DNC once he
had been re-elected in 2012. Indeed, for a man with his roots in community organisation, Mr Obama
did little to tend to the health of his party. His campaign group, Organising For Action, has been
described as a “shadow party” that served the interests of the president and his election campaigns but
drained funds away from state-level branches. Meanwhile, the innovations of the 2008 campaign, such
as the collection of small online donations and swathes of shareable digital content, were improved
upon by the Trump campaign in 2016. And even though the DNC is now under new leadership, it
continues to be out-earned twice over by the Republican National Committee.
The year ahead should offer the Democrats clear opportunities. The Republican administration
has suffered a series of embarrassments. Mr Trump has historically low approval ratings. The number
of House seats that the Democrats need to win to secure a majority in 2018 is modest compared with
the typical mid-term swing. Polls on a generic ballot basis suggest that the Democrats are far enough
ahead to win a narrow majority. But we are unwilling at present to forecast a Democratic win in the
House, never mind in the Senate.
Presidential approval ratings at day 300
(% net approval; chronological order)
80.0 80.0
70.0 70.0
60.0 60.0
50.0 50.0
40.0 40.0
30.0 30.0
20.0 20.0
10.0 10.0
0.0 0.0
-10.0 -10.0
-20.0 -20.0
Gerald Ford

Ronald Reagan
Harry S Truman

Dwight D Eisenhower

John F Kennedy

Lyndon B Johnson

Richard Nixon

Jimmy Carter

Bill Clinton

Barack Obama

Donald Trump
George W Bush
George H W Bush

Source: FiveThirtyEight.

Three reasons to worry

Our pessimistic view of the Democrats’ chances is partly based on the fact that the playing field is not
level. DecisionDeskHQ, a polling organisation, expects the Democrats to win 54% of the House vote
at the mid-terms, but to win just 48% of the seats. This disparity is due to gerrymandering. Back in
2010 when the Republicans were in the doldrums they launched the REDMAP project. REDMAP focused
the party’s energies at the mid-terms on state legislatures with small Democratic majorities. Seats

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that had long been considered safe and were subject to only lacklustre campaigning suddenly saw a
huge increase in spending and attention. REDMAP’s efforts resulted in Republicans winning more than
700 state legislative seats and control over 20 chambers. This meant that when new census data was
published in 2011, Republicans were free to redraw the political map.
Redistricting, or gerrymandering, has been used throughout American history. Its two basic tools
are packing and cracking. Packing involves drawing districts that contain as many voters from the
rival party as possible to limit the number of seats their votes will win. Cracking means spreading the
remaining opposition voters out as thinly as possible over the rest of the districts. The proliferation
of voter data means that governments are getting better and better at redistricting—hence
DecisionDeskHQ’s six-percentage-point gap between Democrats’ share of the vote and their share of
House seats. There is little that Democrats can do to address this ahead of the 2018 elections, although
we note that the Supreme Court is currently hearing a case on possible gerrymandering in Wisconsin
that could eventually see new rules imposed to prevent extreme manipulation of electoral maps. The
case is likely to rest on whether the court and, in particular, swing justice Anthony Kennedy, is satisfied
by a new methodology to measure the extent of gerrymandering.

Selected House seats following redistricting

Maryland 2nd North Carolina 12th Illinois 4th


City Chicago


Source: Wikimedia Commons.

The Democrats also have an image problem. Historically the party of the working class, it is now
more accurately the party of cosmopolitanism. Immigrants of all colours tend to favour the Democrats,
and this appeal has, in turn, attracted liberal, well-off voters in coastal metropolises. But the party
has struggled to maintain its relevance to inland white Americans. As a television host, Joy Ann
Reid, put it, the white working-class Democratic base “resent[s] the changes that racial and religious
multiculturalism have brought to societies where people like them have been the majority”. Gaffes
such as Mrs Clinton describing Trump voters as a “basket of deplorables” compound accusations that
the Democrats are elitist. A special election in Georgia earlier in 2017 illustrated the problem. The
Democrats spent heavily on the seat. They highlighted Mr Trump’s unpopularity and their candidate,
Jon Ossoff, courted right-leaning voters by promising fiscal discipline. Yet Mr Ossoff still lost. The
Republican campaign portrayed him as a puppet of the House minority leader, Nancy Pelosi, and her
“San Francisco values”, and enough voters agreed. A House representative from Ohio, Tim Ryan,
lamented that the Democratic brand was “toxic”.
This is probably too severe a diagnosis of the Democrats’ ills; a truly toxic party would fail to make
the gains at the mid-terms that we expect. But the Democrats are having difficulties explaining their

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promise to voters. There are two separate strands of left-wing politics coursing through the party
that are muddying its message. The first can be described unflatteringly as pursuing identity politics,
or championing the rights of minorities and women, which mainstream society has marginalised.
This was the foundation of the Obama coalition. Identity Democrats argue that the party should
pursue these marginalised voters in the Sun Belt states of North Carolina, Arizona and Texas, where
populations are growing quickly and becoming more liberal, and push a positive, progressive message
that is supportive of immigration, racial justice and globalisation. This would also provide a bracing
distinction from Trump-era Republicans.
The second strand is the party’s economic left. Even though the Democrats led America’s response
to the global financial crisis through the party’s control of the White House and Congress, the
underlying issues of inequality, deindustralisation and corporate capitalism reinvigorated those on
the left. It is a constituency whose views had been subdued by two decades of consistent economic
growth and the waning influence of the union movement, but was ready for a resurgence. Inspired by
the anger of activist groups such as Black Lives Matter and Occupy Wall Street, Economic Democrats
champion firmer controls on Wall Street, deeper investigations of corporate mergers, more consumer
protections, higher wages and stronger workers’ rights. They remain suspicious of free-trade
agreements and the free and easy movement of capital. They want the party to double-down on the
Rust Belt states that it lost in 2016 and re-energise its union base.
Hillary versus Bernie, redux
This ideological battle is the one that played out in the 2016 primaries: Mrs Clinton vs Mr Sanders.
Mrs Clinton may have won in 2016, but her narrow margin of victory and her defeat in the presidential
election have only reinforced the conviction of the Sanders wing that it is pursuing the right course.
This, then, is the challenge for the Democrats in the year until the mid-terms. The party can contain
a broad swathe of views, but it cannot take such different perspectives out to voters and hope to be
easily understood.
The party’s policies and its messaging remain confused. Mrs Clinton’s manifesto was one of the
most progressive in modern American history—it was compiled under the heavy influence of Elizabeth
Warren, a senator with strong Sanders-esque leanings—but as Mr Greenberg suggests, Mrs Clinton
was entirely the wrong person to sell it. Similarly, the document unveiled earlier in 2017 by the party
leaders, Chuck Schumer and Ms Pelosi, was packed full of Economic Democrat ideas: higher minimum
wages, huge infrastructure spending, paid maternity and sick leave; and new regulatory powers to curb
monopolies. But Ms Pelosi, a typical Identity Democrat, told The Washington Post that the plan was not
“a course correction, but it is a presentation correction”. Instantly, its effectiveness withered.
It is clear that the Democratic Party’s platform has shifted to the left, but it is less clear that its
leadership is willing to admit it and run a full-throated campaign on their new agenda. Their overriding
concern is that embracing the Economic Democrats’ ideology will see them lose voters in the Sun Belt
as quickly as they win back support in the Rust Belt. Over the next year Mr Schumer and Ms Pelosi face a
test of nerve. They could go against their instincts and embrace the ideas of the left wholeheartedly. Or
they could duck the question, appeal to both Belts simultaneously, and hope that widespread dislike of
Mr Trump will be enough to return the House to the Democrats. It is a tough, unenviable choice.
© The Economist Intelligence Unit Limited 2017 7
America’s ailing political parties

The Republicans: governing sucks

I n the year since the Republican Party swept the board at the 2016 elections, it has discovered that
being in government is much tougher than being in opposition. The collapse of healthcare reform
means it has failed to pass a single major piece of legislation, while its successes, such as appointing
a new Supreme Court justice, have come at the cost of further political polarisation. A CNN poll
conducted in November 2017 found that just 29% approved of the Republican Party, the lowest level
since the question was first asked 25 years ago.
Like the Democrats, the Republican Party contains diverse views, encompassing relative moderates
to fiscal conservatives and firebrand evangelicals and libertarians. But unlike their rivals, Republicans
have largely succeeded in speaking in unison, especially while in opposition. This discipline began in
the mid-1990s. At the 1994 mid-term elections, Republicans’ efforts were led by the minority whip,
Newt Gingrich. He centralised campaigning so that elections were fought not on local issues, but on his
Contract for America, an explicit set of reforms that Republicans promised to enact if elected. Voters
responded by giving Republicans their first majority in the House for 40 years.
Both the content and the delivery of Mr Gingrich’s Contract have proved highly influential. By
instructing Republicans to concentrate on a single document—much of which was lifted from a state of
the union speech by Ronald Reagan—he ensured a highly focused, ideologically united party. And his
delivery was aggressive. Ideology superseded truth; facts and evidence were debased. Mr Gingrich’s
successors continued down this path. During the presidency of George W Bush, Republicans sought

Breaking the filibuster

(no. of cloture motions filed per Congress)
Democratic control of Senate and White House Republican control of Senate and White House Split control
300 300

250 250

200 200

150 150

100 100

50 50

0 0
























Source: US Senate.

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fewer Democratic votes, preferring to push legislation that could be passed by their members
alone, weakening bipartisanship. The hostility between the parties deepened during the Obama
administration. The Republican leader in the Senate, Mitch McConnell, attracted infamy by
distilling the Republican agenda into a single objective: “deny[ing] President Obama a second
term”. He also disregarded protocol by refusing to conduct nomination hearings for Mr Obama’s
choice of Supreme Court judge. The party repeatedly pushed for evidence of administration
misconduct through several enquiries into the Benghazi attacks, and staunchly opposed
government legislation: the Affordable Care Act was sent up to the Supreme Court again and
again, only for the Court to rule its favour.
These obstructionist tactics—reducing bipartisanship, centralising power and launching
all-out war on the government—proved successful for the Republicans. Following the death
of Antonin Scalia, in February 2016, it was hard to imagine a Supreme Court with a long-term
conservative majority, but Mr McConnell’s intransigence made it possible. Furthermore, because
Republicans opposed Mr Obama as a matter of principle, many of his biggest achievements, such
as the Iran nuclear deal and the US-led Trans-Pacific Partnership, were passed using executive
order, which could be undone by his successor. Donald Trump has made much more progress
knocking down Mr Obama’s legacy than he has building his own. This behaviour, cemented over
more than two decades, has become hard to shift and is the biggest reason why the Republicans
are finding governing so difficult, even from a very strong position.
An unhappy marriage
The rigid ideology of the Republican Party—in place since Reagan’s election and intensified by the
Gingrich era—is also contributing to their woes. Paul Krugman describes the party as “monolithic”
because it has sealed itself off from outside influence. Its funding is provided by a small group of
wealthy families, while its own conservative media echo its existing sentiments. And because these
structures have now existed for decades, the next generation of conservatives have known little else.
That was, of course, until the party’s hostile takeover by Mr Trump.
The past year has demonstrated just what an ill fit Mr Trump and the Republican Party are for each
other. The party marches to the beat of a single drum—small government, low tax, personal liberty—
while the president operates on instinct: he goes where he thinks he can cut the best deal. Take his
treatment of the debt ceiling. He was desperate to get one over on the Republican congressional
leadership after the healthcare debacle, so he sided with the Democrats on the extension to
government funding. Given how tribal the Republicans had made American politics, Mr Trump’s
decision was almost unfathomable. The president himself was unconcerned; indeed, he is believed to
have lapped up praise from the mainstream press for vaulting over party politics.
Conservatism, but not as we know it
The collision of a highly ideological party and a non-aligned president has so far produced some odd
outcomes. The party of fiscal discipline, which has been pushing tough rules on balanced budgets
since Mr Gingrich’s Contract for America, is urgently pushing through a series of tax cuts that would
add US$1.7trn to the federal debt. Simultaneously, Mr Trump has been rebuffed by the party on a big

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infrastructure package as the party claims the country cannot afford it. The president, whose signature
campaign policy was the construction of a wall on the Mexican border, has instructed Congress to
protect the futures of 800,000 undocumented immigrants. And perhaps strangest of all, it is likely
to be a Republican administration that protects health insurance marketplaces from collapse, even
though the party has opposed so-called socialised medicine for more than 70 years.

Trump tax plan

(% of GDP)
Federal budget balance Public debt
Congressional Budget Office baseline Under tax plan Congressional Budget Office baseline Under tax plan
-2.0 -2.0 100 100

-2.5 -2.5
95 95
-3.0 -3.0

-3.5 -3.5 90 90

-4.0 -4.0
85 85
-4.5 -4.5

-5.0 -5.0 80 80

-5.5 -5.5
75 75
-6.0 -6.0

-6.5 -6.5 70 70
2018 19 20 21 22 23 24 25 26 27 2018 19 20 21 22 23 24 25 26 27
Source: Congressional Budget Office.

The response of the Republican Party to Mr Trump has been fascinating. On the one hand, Mr Trump
has unexpectedly delivered to the party the most powerful commodity of all: power. This has put
him enormously in credit. On the other hand, Mr Trump has shifted the party’s long-held position on
international trade; humiliated the congressional leadership; forced the party into tortuous positions
because of his inflammatory remarks on the culture wars; churned through staff at an alarming rate;
impeded government departments from operating by failing to staff crucial positions; caused chaos by
announcing new policies on social media; and blamed the party for the ensuing dysfunction. Polling
suggests that voters have more sympathy for the president than the party, which is why Republicans
have largely remained resolutely behind Mr Trump.
Where there has been opposition to the president, it has come from Republicans without political
futures. A senator representing Tennessee, Bob Corker, has variously described the White House as an
“adult day-care centre”, implied that the president was a threat to national security and admitted that
he regretted his support for Mr Trump’s campaign. A senator from Arizona, Jeff Flake, published a book
earlier in 2017 that was critical of Mr Trump’s effect on the conservative movement and told the Senate
to end their “accommodation of the unacceptable”. John McCain, Mr Flake’s senior, has described
Mr Trump’s foreign policy as “half-baked, spurious nationalism cooked up by people who would rather
find scapegoats than solve problems”. These comments are unprecedented from within a president’s

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party. But both Mr Corker and Mr Flake have chosen not to contest their Senate seats in 2018, and
Mr McCain is battling brain cancer. Mr Corker and Mr Flake are casualties of Mr Trump’s Republican
takeover, not the leaders of a rebellion against it. Consequently, we expect to see more congressional
candidates drawing on Trumpist sentiments in 2018 than we will hopefuls distancing themselves from
the president.
Trumpism after Trump
It appears that Mr Trump has awakened something larger than himself. He took control of the party,
effectively by hiding in plain sight. (No-one in the 2016 primary season took him seriously, so the
mainstream contenders focused their ire on each other.) He showed that it was possible to crack open
the monolith. The Republican Party is now a broader church than when it was corralled by Mr Gingrich.
This is bringing its own tensions. Consider the party primary for a vacant Senate seat in Alabama.
The Republican mainstream supported the sitting junior senator, Luther Strange. Mr Trump was also
advised to throw his weight behind Mr Strange. But Mr Strange was defeated by a former state Supreme
Court justice, Roy Moore, whose political positions on homosexuality and immigration would make
even Mr Trump blush. For an insurgent president to be outflanked by an upstart wing in his own party
was a bad look for all concerned.
A visible presence during Mr Moore’s campaign was Mr Trump’s former chief strategist, Steve
Bannon. Ahead of the mid-terms, Mr Bannon declared war on Mr McConnell, who he blames for holding
up Mr Trump’s transformation of the party. He has pledged to field candidates in seven of the eight
Republican Senate seats up for grabs, and has the longer-term aim of unseating Mr McConnell in 2020.
But although Mr Bannon’s success at presidential level is clear, he has no track record in congressional

Senate seats to be contested in 2018

Montana North Vermont Maine


York Massachusetts
Michigan Rhode Island
Nevada Nebraska Pennsylvania New Jersey
Utah Indiana Ohio
Missouri Maryland

New Mexico

Democrat-leaning independent

Hawaii Florida States won by opposing

presidential candidate in 2016

Source: US Senate.

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races. He is attempting to pull off a difficult trick: in the past 14 years, only six out of hundreds of
primary challenges have been successful. And unlike the monolithic Republican Party, Mr Bannon’s
brigade of challengers will be a scattergun selection. He is scouting for candidates who are hard on
immigration, protectionist on trade, supportive of big federal spending on infrastructure and of higher
taxes on wealthy. It is unlikely that Mr Bannon will find many who match his world view exactly, which
means his will be a diverse coalition, with the risk that it will prove undisciplined. It is possible that
Mr Bannon could bring down the mainstream party, but also that he could become part of the collateral
damage, if his band of rebels were to render Congress even less effective than it is now.
Complicating the future for Republicans still further is the probe into Mr Trump and Russia. No-
one knows when the investigation led by the special counsel, Robert Mueller, will be concluded. But
insofar as it has the potential to unseat the president, its effects might be felt sooner—for example if
Mr Mueller were to charge one of Mr Trump’s family members or closest advisers with serious crimes
and if the president felt compelled to pardon them. It seems inevitable that at some stage during
the Mueller reckoning Republicans will be forced to reconsider their loyalty to Mr Trump. However,
ditching Mr Trump would not heal the divisions in the party. The vice-president, Mike Pence, who
would complete the term, might look like a unifying figure: he has deep ties to Republican financiers
and he was also an early standard-bearer for the Tea Party movement. But we do not believe that the
libertarian right would yield easily to Mr Pence. The moment he occupied the White House, they would
consider him lost to Capitol Hill and its “swamp”.
Now that the Republican monolith has cracked, we expect the fissures to deepen in the remainder of
the administrative term. Rank-and-file Republicans will have to decide how wholeheartedly to commit
to the Trump doctrine; these choices will have to be made on a district-by-district basis. Ahead of the
mid-terms, Mr Trump’s popularity among conservatives is likely to ensure that the party reflects a
veneer of discipline. But Trumpism will last longer than its ancestor and the Republican Party’s future is
unlikely to be as stable as its recent past.

12 © The Economist Intelligence Unit Limited 2017


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