Republicans risk backlash by opposing Sotomayor


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WASHINGTON // The scant Republican support for Sonia Sotomayor, who was confirmed last week and sworn in yesterday as the nation's first Hispanic Supreme Court justice, could lead to a potentially crippling backlash for Republican candidates among Hispanic voters, analysts say.

Only nine of the Senate's 40 Republicans voted to confirm Ms Sotomayor, who was nominated by Barack Obama to fill the vacancy left by the retiring Justice David Souter. The lopsided numbers could alienate many Hispanics, the fastest-growing segment of the US electorate and one that is increasingly important for a party hoping to pick up seats in the 2010 midterm elections and beyond. "I think they're in trouble," Guillermo Meneses, a Democratic strategist in Washington and a Hispanic, said of Republicans. "I think it's going to take years if not decades for Republicans to change the playbook on this issue."

"It will cost those Republicans a lot of Latino votes in the next election," added Lionel Sosa, who worked as a media consultant for the last seven Republican presidential candidates. "How many? I don't know. It all depends on how much the opposition grabs this issue and hammers it down their throat." The Sotomayor vote could loom especially large in states such as Arizona, where 30 per cent of the population is Hispanic. John McCain, the 2008 Republican presidential candidate, who did not support Ms Sotomayor's confirmation, faces a Republican primary challenger in that state. Kay Bailey Hutchison, who also voted against Ms Sotomayor, is running for governor of Texas, where Hispanics make up 36 per cent of the population.

Republicans were faced with a tough decision, stuck between appealing to the party's conservative base on one hand while running the risk of alienating Hispanic voters on the other. But the large number of "no" votes stands in sharp contrast to the unanimous Democratic support for Ms Sotomayor and has put many Republican senators on the defensive. Orrin Hatch, a Republican senator from Utah and a member of the judiciary committee, for example, said on the Senate floor that his opposition was based on philosophical differences, not race. "I wish President Obama had chosen a Hispanic nominee whom all senators could support," he said.

John Cornyn, a Republican senator from Texas, meanwhile, wrote an opinion article in the Houston Chronicle stipulating that his "no" vote should not be interpreted as a reflection on Hispanics. "Unfortunately, some on the Left and some on the Right have tried to make this nomination about ethnicity," he wrote. "I strongly reject that view. The only question is Judge Sotomayor's judicial philosophy." Few actually suggest that race was a motivating factor in how senators cast their votes. Republican opposition was centred on the belief that Ms Sotomayor would base her decisions on "empathy" rather than an objective interpretation of the law and many Republicans took issue with some of her past decisions as a federal judge.

It also is not surprising that the vote broke heavily along partisan lines. Ms Sotomayor, after all, is the nominee of a Democratic president and recent Supreme Court nomination battles have been fiercely partisan affairs. In 2006, only four Democrats voted to confirm Samuel Alito, a nominee of George W Bush. Some Democratic senators even called for a filibuster to stop that nomination, a tactic that Republicans rejected using in Ms Sotomayor's confirmation.

Still, the 31 Republican "no" votes were far greater than the single-digit opposition to the two previous Democratic nominees, Justices Ruth Bader Ginsburg and Stephen Breyer. Such numbers will inevitably raise questions for Hispanic voters, particularly after a confirmation process that was infused with racial politics, from debates over the merits of affirmative action to the meaning of Ms Sotomayor's comment that a "wise Latina woman" could arrive at better conclusions than a white man.

Some Democrats, such as Robert Menéndez of New Jersey, the Senate's lone Hispanic member, sought to play up the political pitfalls of Republican opposition. "Republicans will pay a price for saying 'no' to this judge," Mr Menéndez warned in Spanish at a news conference last week. But other legislators, such as Marco Rubio, the first Hispanic speaker of the Florida House of Representatives and current candidate for the US Senate in that state, took exception to the notion that voting against Ms Sotomayor is somehow "anti-Hispanic".

"The suggestion that senators who have fundamental concerns about Sotomayor's judicial philosophy should not dare oppose her for fear of being branded anti-Hispanic is disappointing," he wrote in an opinion piece for Politico, a political newspaper in Washington. A recent Wall Street Journal-NBC News poll showed 58 per cent of Hispanics favoured Ms Sotomayor's confirmation. But the worse news for Republicans is that only 20 per cent of Hispanics held favourable views of their party, while 41 per cent held unfavourable views, according to the poll.

Those poor ratings could drop even further after the Sotomayor confirmation, according to Rosa Rosales, the president of the League of United Latin American Citizens. "We won't forget," Ms Rosales said of the Republicans who voted against Ms Sotomayor. "What we are talking about is an extremely qualified person. We really felt that it was like a slap in the face to the Latino community that they could not support someone with such high qualifications."

sstanek@thenational.ae

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”