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Nine lessons from the U.S. midterms

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WASHINGTON—Democrats took the House. Republicans expanded their margin in the Senate. And Americans were left wondering what exactly it all meant.

The midterm elections on Tuesday were much better for Democrats than for Republicans: Democrats seized the prize they had been targeting all along, House control, plus seven governorships and hundreds of seats in state legislatures. But Republicans were comforted by their own victories in some key races, and the president, as per usual, claimed to be vindicated.

Here are nine lessons from a big night:

Right now, it is not the economy: Democrats campaigned largely on health care, Republicans heavily on immigration. But this election was about Trump more than anything else, defying the “economy, stupid” mantra that has become conventional wisdom about election outcomes.

About two-thirds of voters thought the economy is good or excellent, exit polls suggested. But a majority of them still thought the country was heading in the wrong direction, and Democrats appeared to win the House popular vote by about seven percentage points. Even a continued run of unemployment under 4 per cent might not be sufficient for Trump and his party in 2020 if he continues to behave like himself.

Trump’s appeal is limited and shrinking: Trump has a loyal base, sure, but not all of his 2016 voters remain part of it. About half of Democrats’ pickups in the House came in districts where Trump prevailed two years ago.

This was a suburban uprising. Democrats took Republican seats not only around Detroit, Chicago and Minneapolis but in harder races around Oklahoma City, Dallas and Kansas City. The results showed Trump cannot build a national majority on anger and fear.

Trumpism still works in chunks of the country: Trump targeted his apocalyptic immigration rhetoric at rural and working-class white voters in conservative states where there were Senate races. To Democrats’ dismay, it seemed to be effective.

Indiana dumped a Democratic incumbent, Missouri a two-term Democratic incumbent, Florida a three-term Democratic incumbent. Asked what lessons he took from the election, Trump said, “I think people like me.” If you looked only at the Senate results, that didn’t seem crazy.

Trump has a Great Lakes problem: Democrats dominated in Great Lakes states where Trump exceeded 2016 expectations. In Pennsylvania, Michigan and Wisconsin, the three states Trump eked out to win the presidency, Democrats won both the governorship and the Senate race. Democrats also dominated in Minnesota, where Trump came close in 2016.

Trump could win all four states in 2020 depending on who Democrats put up against him. But his standing is not where he needs it to be in a region that may well be pivotal again.

Democrats still have an Ohio-and-Florida problem: Trump won the two perpetual swing states in 2016. Republicans did well once more this year, again on their strength with rural and working-class whites.

Though popular Democratic Sen. Sherrod Brown prevailed, his margin was smaller than most polls suggested. Democrats also lost the Ohio governor race they thought they could win. In Florida, they lost both the governor and Senate races in which they had high hopes, both to Trump-backed conservatives who excelled in the culturally southern Panhandle region.

One downer for Republicans: a big liberal victory on Tuesday might make Florida’s 2020 landscape substantially different. Voters approved a provision to automatically restore voting rights to most ex-felons, who are disproportionately people of colour.

Obamacare is…popular: After consecutive midterms in which Republicans successfully assailed Obamacare, the tables have turned. Democrats won the House campaigning on a platform of defending Obamacare protections for people with health conditions.

And it wasn’t only that: voters in three conservative states, Idaho, Nebraska and Utah, voted to use Obamacare to give Medicaid health insurance to tens of thousands more low-income people, a move their Republican politicians had refused to make.

On the Democratic side, women rule: Women led the anti-Trump resistance movement. Women drove the wave of small donations to Democratic candidates. Women voted overwhelmingly for Democrats: exit polls showed Democratic House candidates winning with female voters by a record 19 points.

And, uncoincidentally, women were the candidates. The election shattered a record for the number of women winning House races, more than 100 in all (the chamber has 435 seats) and more than three-quarters of them Democrats, according to the Center for American Women and Politics. Perhaps even more notably, female candidates were responsible for about half of Democrats’ House gains.

The Democratic presidential primary will likely be a many-candidate free-for-all, men and women. Unusually, the women might start with an advantage.

Democrats don’t need to go “safe” on race: Trump has successfully harnessed the politics of white identity. The midterms showed Democrats don’t have to counter him with white people. A Native American woman, Sharice Davids, unseated a white Republican man in the Kansas City suburbs; a Black man, Colin Allred, unseated a white Republican man in the Dallas suburbs; a Black man, Rhodes Scholar Antonio Delgado, unseated a white Republican man in upstate New York after a barrage of barely veiled attacks on his race.

Scandals matter less now: It’s hard to prove cause and effect, but Trump might have helped lower the bar for what a candidate can get away with. Two Republican congressmen who have been charged with crimes, California’s Duncan Hunter and New York’s Chris Collins, both got re-elected, though by slimmer margins than in the past. Republican Iowa Rep. Steve King, under fire for his support for white nationalists, also won a narrower-than-usual victory. Democrat Keith Ellison, accused of abuse by an ex-girlfriend, was elected attorney general of Minnesota.

Daniel Dale is the Star’s Washington bureau chief. He covers U.S. politics and current affairs. Follow him on Twitter: @ddale8

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‘Business as usual’ for Dorel Industries after terminating go-private deal

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MONTREAL — Dorel Industries Inc. says it will continue to pursue its business strategy going forward after terminating an agreement to go private after discussions with shareholders.

« Moving ahead. Business as usual, » a spokesman for the company said in an email on Monday.

A group led by Cerberus Capital Management had previously agreed to buy outstanding shares of Dorel for $16 apiece, except for shares owned by the family that controls the company’s multiple-voting shares.

But Dorel chief executive Martin Schwartz said the Montreal-based maker of car seats, strollers, bicycles and home furniture pulled the plug on a deal on the eve of Tuesday’s special meeting after reviewing votes from shareholders.

“Independent shareholders have clearly expressed their confidence in Dorel’s future and the greater potential for Dorel as a public entity, » he said in a news release.

Dorel’s board of directors, with Martin Schwartz, Alan Schwartz, Jeffrey Schwartz and Jeff Segel recused, unanimously approved the deal’s termination upon the recommendation of a special committee.

The transaction required approval by two-thirds of the votes cast, and more than 50 per cent of the votes cast by non-family shareholders.

Schwartz said enhancing shareholder value remains a top priority while it stays focused on growing its brands, which include Schwinn and Mongoose bikes, Safety 1st-brand car seats and DHP Furniture.

Dorel said the move to end the go-private deal was mutual, despite the funds’ increased purchase price offer earlier this year.

It said there is no break fee applicable in this case.

Montreal-based investment firm Letko, Brosseau & Associates Inc. and San Diego’s Brandes Investment Partners LP, which together control more than 19 per cent of Dorel’s outstanding class B subordinate shares voiced their opposition to the amended offer, which was increased from the initial Nov. 2 offer of $14.50 per share.

« We believe that several minority shareholders shared our opinion, » said Letko vice-president Stephane Lebrun, during a phone interview.

« We are confident of the long-term potential of the company and we have confidence in the managers in place.”

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Pandemic funds helping Montreal businesses build for a better tomorrow

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Many entrepreneurs have had to tap into government loans during the pandemic, at first just to survive, but now some are using the money to better prepare their businesses for the post-COVID future.

One of those businesses is Del Friscos, a popular family restaurant in Dollard-des-Ormeaux that, like many Montreal-area restaurants, has had to adapt from a sit-down establishment to one that takes orders online for takeout or delivery.

“It was hard going from totally in-house seating,” said Del Friscos co-owner Terry Konstas. “We didn’t have an in-house delivery system, which we quickly added. There were so many of our employees that were laid off that wanted to work so we adapted to a delivery system and added platforms like Uber and DoorDash.”

Helping them through the transition were emergency grants and low-interest loans from the federal and provincial governments, some of which are directly administered by PME MTL, a non-profit business-development organization established to assist the island’s small and medium-sized businesses.

Konstas said he had never even heard of PME MTL until a customer told him about them and when he got in touch, he discovered there were many government programs available to help his business get through the downturn and build for the future. “They’ve been very helpful right from day one,” said Konstas.

“We used some of the funds to catch up on our suppliers and our rents, the part that wasn’t covered from the federal side, and we used some of it for our new virtual concepts,” he said, referring to a virtual kitchen model which the restaurant has since adopted.

The virtual kitchen lets them create completely different menu items from the casual American Italian dishes that Del Friscos is known for and market them under different restaurant brand names. Under the Prasinó Soup & Salad banner, they sell healthy Greek options and their Stallone’s Sub Shop brand offers hearty sandwiches, yet the food from both is created in the same Del Friscos kitchen.

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Downtown Montreal office, retail vacancies continue to rise

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Some of downtown Montreal’s key economic indicators are heading in the wrong direction.

Office and retail vacancies in the city’s central core continued to climb in the fourth quarter of 2020, according to a quarterly report released Thursday by the Urban Development Institute of Quebec and the Montréal Centre-Ville merchants association. The report, whose first edition was published in October, aims to paint a socio-economic picture of the downtown area.

The survey also found office space available for sublet had increased during the fourth quarter, which may foreshadow even more vacancies when leases expire. On the residential front, condo sales fell as new listings soared — a sign that the downtown area may be losing some of its appeal to homeowners.

“It’s impossible not to be preoccupied by the rapid increase in office vacancies,” Jean-Marc Fournier, the former Quebec politician who now heads the UDI, said Thursday in an interview.

Still, with COVID-19 vaccinations set to accelerate in the coming months, “the economic picture is bound to improve,” he said. “People will start returning downtown. It’s much too early to say the office market is going to disappear.”

Public health measures implemented since the start of the pandemic almost a year ago — such as caps on office capacity — have deprived downtown Montreal of more than 500,000 workers and students. A mere 4,163 university and CEGEP students attended in-person classes in the second quarter, the most recent period for which figures are available. Border closures and travel restrictions have also brought tourism to a standstill, hurting hotels and thousands of local businesses.

Seventy per cent of downtown workers carried out their professional activities at home more than three days a week during the fourth quarter, the report said, citing an online survey of 1,000 Montreal-area residents conducted last month.

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