The most important legislative body on earth is now divided between the Democrat controlled House and Republican controlled Senate.
Trump’s command over all Capitol Hill law making bodies has come to an end. Suburbia revolted. Giving the result you’d expect from an educated electorate.
They have asked Democrats to keep Trump in check and they have asked the Senate to keep Democrats in check.
Talks of impeachment, thus, would be foolish as Republicans gained in the Senate. Likewise continued rhetoric of an “invasion” would probably guarantee a 2020 loss of the presidency.
The campaign there has already started and will now go on for the next two years. Everything they do will probably be with an eye towards the big prize, the presidency.
Today’s result should have both parties on edge because the electorate is saying they like some things Trump has done so far, and they don’t like some others.
Trump therefore is right in some ways to say this was a win, just as Democrats are right to say this was a win. Yet both parties should feel they stand in a fragile position.
Trump especially should hear what the people are saying. They have given him a second chance. They could have taken the Senate off him too. They haven’t. They wanted to give him a warning, while keeping him as President.
On foreign policy Trump has done well, but domestically he hasn’t. He gave this space Jay Clayton, the banker’s man who appears handpicked to attack cryptos. He has not kept his promises on regulations. He wasted his half-term on immigration, when he could have picked better priorities.
For that he has been punished, but not severely. That’s because he did defeat ISIS, but then that defeat should have been followed with a toning down of rhetorics, rather than ratcheting it up to a level where many good men and women, perhaps even his immigrant wife, may have started feeling worried.
That should now change because the House will block him and they’d have suburbia to back them. That means little controversial would get done, which might be an opening for this space.
We necessarily have to be neutral. We’re building tools for Republicans and Democrats, the few and the many, immigrants and natives, legals and illegals, even for the bankers.
Yet there are suggestions Democrats are not friendly to this space. That’s not very true. Two crypto friendly Democrats, for example, have become governors. Yet Nancy Wojtas, a former Counsel to SEC’s Chairman of the Commission, says:
“My hope is congress would act, that we need a new regulatory agency that would come in with a lighter touch to regulation that they’re not stuck with the baggage of the 33 Act the 34 Act. And that the agency has an understanding of what blockchain technology can do…
We have to be concerned about Congress because they’re taking an interest in this. I do find that the democrats seem to be less inclined to be more flexible with respect to cryptocurrency, which I find kind of surprising myself.
If there’s a shift in our Congress as result of the mid-term elections, that hill just got really much higher. We keep working at it, we need a solution. Either we keep innovation in the US or we move it off-shore.”
There is a broad understanding, certainly within this space but also in the tech and business industry more widely, that the Securities Act 1933 needs reforms.
In particular, the limitations on investment in start-ups are outdated and backwards. For this space they simply can’t work, because you can’t limit a token sale to only a handful rich mainly men VCs. Nor can you ask a start-up that wants to raise $20 million to first spend $20 million in compliance with all the Securities Act requirements designed for global corporations.
With a divided congress where only bipartisan initiatives can get through, turning the focus on the economy, and in particular the governor of the economy – the Securities Act – might be a smart move.
This would play very well with Trump’s base as it would keep his promise regarding regulations and the swamp, a swamp with a root cause in this Securities Act.
There still need to be rules, of course, but there needs to be different rules for start-ups who want to raise from the public say $20 million. Slightly more stringent rules for up to $100 million, and then the full requirements for companies wanting to raise more than that from the public.
One way this can be done is to have a crypto or a tokens specific federal regulator or a federal self-governing organization. Another way would be to have more general rules for all start-ups.
That should unleash innovation and dynamism and should create capitalism for all, rich or poor or the more common middle class.
It should also be something that Democrats support because if Trump puts something reasonable forward and they reject it, the electorate may well punish them.
It should also be something that Republicans support too, but really it would probably be something that everyone supports because you’d be addressing any concerns over immigration and “they took our jobs” by creating a booming economy through the production of real value such as tech innovation and so on.
If Trump can get this through and if he tones down his rhetoric on more divisive social issues, then he may have a chance in 2020. Likewise if Democrats block this, then they’d be skirting pretty close to tilting our neutrality.
We want an economy for all, and really, after security, economy is the most important thing that more directly addresses other social aspect.
So while this divided congress might not be able to do much, we hope they can focus and work together on reforming this century old law for the benefit of the many and the few.