Month: July 2011

What Happens in Vegas
by David Atkins (thereisnospoon)

If you don’t watch Fox News or read conservative blogs, you might just have missed it. But those who live in the echo chamber have been treated to a small media frenzy over an anti-Obama, anti-regulation rant made by Las Vegas casino don Steve Wynn a few days ago. For those unfamiliar with Steve Wynn, he’s the most powerful man in Vegas, owner of multiple resorts, including one of the latest, poshest monstrosities. Wynn is basically the template for the villain in the modern Ocean’s Eleven film series, the foil for George Clooney’s irascible thief.
The rant goes on at length across a sprawling conference call transcript, but here’s a small taste:

But I’m afraid to do anything in the current political environment in the United States. You watch television and see what’s going on on this debt ceiling issue…And I’m saying it bluntly, that this administration is the greatest wet blanket to business, and progress and job creation in my lifetime. And I can prove it and I could spend the next 3 hours giving you examples of all of us in this market place that are frightened to death about all the new regulations, our healthcare costs escalate, regulations coming from left and right. A President that seems, that keeps using that word redistribution. Well, my customers and the companies that provide the vitality for the hospitality and restaurant industry, in the United States of America, they are frightened of this administration…The guy keeps making speeches about redistribution and maybe we ought to do something to businesses that don’t invest, their [sic] holding too much money…And it makes you slow down and not invest your money. Everybody complains about how much money is on the side in America.

You bet and until we change the tempo and the conversation from Washington, it’s not going to change. And those of us who have business opportunities and the capital to do it are going to sit in fear of the President.

Now, there are so many things wrong with just this much of the tirade from a factual basis that it’s hard to know where to start. First of all, as Steve of Veracity Stew notes, Mr. Wynn’s company Wynn Resorts Limited boasted record profits in Q2 2011. The man himself increased his personal fortune from $1.3 billion to $1.5 billion this year. As with the rest of the corporate sector enjoying record-breaking profits, it’s difficult to discern precisely what he has to complain about from the government that has enabled his larder to grow even as millions suffer in increasing desperation. If this is a time of dreaded Marxist wealth redistribution, it would be interesting to see what sort of horrific inequalities more “business-friendly” policies might create. Mr. Wynn’s reaction to progressive objections that the “job creators” are sitting on record cash by not creating jobs is to…sit on record cash and not create jobs, apparently out of fear that someone might force them to create jobs in America? Come again? Mr. Wynn complains of escalating healthcare costs in his business, as if the ACA were not designed to mitigate precisely that problem, and as if any reasonable economist would not respond that the best way to mitigate healthcare costs is through the sort of single-payer program that President Obama rejected out of hand, so that Mr. Wynn could accuse him being a socialist with a “weird” political philosophy.

Meanwhile, Las Vegas itself is a paean to excess, made possible only by massive government-enabled irrigation projects, highways, and airports. The economic disaster that has consumed Las Vegas in recent years was a direct product of the housing boom and bust, itself caused by too little regulation of certain kinds of financial casinos that see Mr. Wynn’s core business activities as illegitimate competition. More importantly, Mr. Wynn’s fears over the debt ceiling are created entirely by Republicans holding hostage the (very slow for the rest of us, but very fast for Mr. Wynn) international recovery upon which Mr. Wynn’s business interests depend. Later on in his rant, Mr. Wynn complains bitterly about overbearing homeland security procedures discouraging visits from wealthy Chinese nationals–a direct byproduct of the Republican Bush Administration’s homeland security state, to which Barack Obama has simply given bipartisan cover. In short, most of Mr. Wynn’s complaints, such as they are, should be directed squarely at Republicans.

But Mr. Wynn’s wrongheadedness isn’t really the point that needs making here. He’s a very rich man doing much better than he ought compared to the rest of us. But he’s afraid that his taxes might be raised marginally, which might prevent him from buying…who knows? A few more yachts and Picasso paintings to punch holes in? His ulterior motives are fairly obvious, so does the accuracy of his ravings really matter? Not much.

What is more interesting is the fact that the rant of a Las Vegas casino tycoon has been held up in right-wing circles as validation of their attacks on Obama, Keynesianism, and progressive economics in general. This only a couple of years after a similar but better-planned rant by yet another overprivileged tycoon from the more illustrious casinos in Manhattan set off the Tea Party crazies who are currently causing the default crisis nuttery the Vegas tycoon seems so afraid of.

Never has the disconnect of an entire political party from the mass of public opinion been so apparent as it is today, when the heroes who ride to the ideological rescue, the Paul Reveres who cry “the taxes are coming!”, are as hated as a Wall St. mortgage-backed securities-dealing crook, and a Vegas casino mogul who makes such an easy Hollywood villain that we root without a second’s thought for outright thieves of little redeeming character in and of themselves. Of course, the Republican calculus is that their lengthy distance from the electoral center won’t matter so long as they can discredit the entire enterprise of government itself while ginning up the latest inconsequential outrage. And perhaps they’re right. But we should still marvel at the sight of one of the nation’s two major political parties elevating such blatantly unpopular, almost stereotypical villains as archetypal heroes.

But perhaps most importantly, never has the disconnect between the pillars that make up the Republican Party itself been so apparent. As we speak, a hardcore evangelical Christian from the Midwest is leading in the national polls for the GOP presidency. The most popular standard-bearer in today’s GOP is a woman who wants to ban pornography and isn’t exactly a big fan of the gaming industry, either. Let’s be clear about this: if she were Emperor for a day, the GOP frontrunner would put all of Las Vegas out of work instantly by killing any and all business related to sex and gaming. She would redistribute that money to fund evangelical Christian schools and “charities.” She would crack down on immigration and homeland security procedures, and scare off those Chinese visitors Mr. Wynn seems so eager to attract.

And yet Mr. Wynn himself, a man whose personal fortunes have risen dramatically under the Obama Administration, is freaked out not by Republicans, but by Democrats, at a time when Democrats are arguably more “business-friendly” than at any time since Woodrow Wilson if not the era of Reconstruction. Even as the same Republicans who have elevated a demonstrable Dominionist nutcase as their frontrunner cheer on the tirades of a businessman whose livelihood depends on sex tourism and gambling.

This is not a sustainable situation. This is not a political environment in which the normal rules of barter, argument and compromise apply. This is full-blown mania, a mirror on a broader national insanity. Sooner or later, something has to give.

Hedge Fund Hogs sniff around Chris Christie

by digby

So the billionaires are whining again. Yesterday a bunch of hedge fund managers got together to beg Chris Christie to run for president. (He said “not this time.”)Apparently, they can’t vote for Obama becausethey’re feeling very fragile right now:

Several of them said: I’m Republican but I voted for President Obama, because I couldn’t live with Sarah Palin. Many said they were severely disappointed in the president. The biggest complaint was what several called “class warfare.” They said they didn’t understand what they had done to deserve that: If you want to have a conversation about taxation, have a conversation. But a president shouldn’t attack his constituents – he’s not the president of some people, he’s president of all the people. Someone mentioned Huey Long populism.

That’s right. He’s their president too and it just makes them feel all icky an stuff when he says mean things about them. Apparently this isn’t enough to soothe them:

The share of national income going to the top 0.1 percent (the Stinking Rich) increased nearly fourfold during the Great Divergence. “The [inequality] phenomenon is more extreme the further you go up in the distribution,” Saez told me, and it’s “very strong once you pass that threshold of the top 1 percent.” Canada’s and the United Kingdom’s Stinking Rich followed a similar (though less pronounced) trend, but Japan and France did not; in the latter two countries, the Stinking Rich received about the same proportion of national income (about 2 percent) as the Stinking Rich did in all five countries prior to the Great Divergence. In a 2009 paper, Saez and Piketty surveyed several other industrialized nations (Table 5); in none of them did the Stinking Rich come anywhere near the 7.7 percent share of national income found in the United States.

Apparently they believe they should have it all. And we should all say “thank you sir, for taking it.”

The fact is that the markets have been doing very well under President Obama and he’s done next to nothing to change the income distribution. His health care plan was a private industry plan and his alleged “tax hikes” are downright measly. Indeed, if he has his way he’ll be “flattening” the tax code while “closing loopholes” a billionaire’s perfect solution. (Lobbying costs to open them again are chump change. It’s the lower rates they are after. Once lowered, never raised …)

The only thing Obama did to these Masters of the Universe was use the word “fat cat” a couple of times and mouth platitudes like “people like me should pay their fair share” as if it will really hurt any of these hedge fund hogs to give up the tiniest percentage of their ill gotten gains. Other than that, he’s been downright subservient. Certainly nothing in the deficit reduction talks can be seen as particularly threatening.

No, they are the very definition of what Atrios dubbed the WATBs. (You can look it up.) This is purely because they feel they haven’t gotten the public respect and deference they deserve. Even though they screwed everything up royally (pun intended) and the ungrateful little people had to bail them out. As Michele Bachman would say — that’s some major chootspaw.

.

More good news

by digby

I’m thrilled to announce that David Atkins, also known as thereisnospoon on Daily Kos, is going to be contributing to this humble little blog going forward.

I couldn’t be happier to have him. He’s an excellent writer, thinker and activist and will add some much needed variety to my usual fare. He’s also a Southern Californian and friend.

Please give him a warm welcome.

.

Common sense

by digby

Michael Moore’s site has posted this speech by FDR at Forbes Field in 1936. it certainly has resonance today. I’ve just excerpted a piece of it here:

When the new management came to Washington, we began to make our plans—plans to meet the immediate crisis and plans that would carry the people of the country back to decent prosperity.

You and I and everybody else saw the millions out of work, saw the business concerns running in the red, saw the banks closing. Our national income had declined over 50 percent—and, what was worse, it showed no prospect of recuperating by itself. By national income I mean the total of all income of all the 125,000,000 people in this country—the total of all the pay envelopes, all the farm sales, all the profits of all the businesses and all the individuals and corporations in America.

During the four lean years before this Administration took office, that national income had declined from eighty-one billions a year to thirty-eight billions a year. In short, you and I, all of us together, were making forty-three billions—spelled with a “b,” not an “m”—forty-three billion dollars less in 1932 than we made in 1929.

Now, the rise and fall of national income—since they tell the story of how much you and I and everybody else are making-are an index of the rise and fall of national prosperity. They are also an index of the prosperity of your Government. The money to run the Government comes from taxes; and the tax revenue in turn depends for its size on the size of the national income. When the incomes and the values and transactions of the country are on the down-grade, then tax receipts go on the down-grade too. If the national income continues to decline, then the Government cannot run without going into the red. The only way to keep the Government out of the red is to keep the people out of the red. And so we had to balance the budget of the American people be-fore we could balance the budget of the national Government.

That makes common sense, doesn’t it?

The box score when the Democratic Administration came to bat in 1933 showed a net deficit in our national accounts of about $3,000,000,000, accumulated in the three previous years under my predecessor.

National income was in a downward spiral. Federal Government revenues were in a downward spiral. To pile on vast new taxes would get us nowhere because values were going down-and that makes sense too.

On top of having to meet the ordinary expenses of Government, I recognized the obligation of the Federal Government to feed and take care of the growing army of homeless and destitute unemployed.

Something had to be done. A national choice had to be made. We could do one of two things. Some people who sat across my desk in those days urged me to let Nature take its course and to continue a policy of doing nothing. I rejected that advice because Nature was in an angry mood.

To have accepted that advice would have meant the continued wiping out of people of small means—the continued loss of their homes and farms and small businesses into the hands of people who still had enough capital left to pick up those homes and farms and businesses at bankruptcy prices. It would have meant, in a very short time, the loss of all the resources of a multitude of individuals and families and small corporations. You would have seen, throughout thpre Nation, a concentration of property ownership in the hands of one or two percent of the population, a concentration unequaled in any great Nation since the days of the later Roman Empire.

And so the program of this Administration set out to protect the small business, the small corporation, the small shop, and the small individual from the wave of deflation that threatened them. We realized then, as we do now, that the vast army of small business men and factory owners and shop owners—together with our farmers and workers—form the backbone of the industrial life of America. In our long-range plan we recognized that the prosperity of America depended upon, and would continue to depend upon, the prosperity of them all.

I rejected the advice that was given to me to do nothing for an additional reason. I had promised, and my Administration was determined, to keep the people of the United States from starvation.

I refused to leave human needs solely in the hands of local communities—local communities which themselves were almost bankrupt.

To have accepted that advice would have been to offer breadlines again to the American people, knowing this time, however, that in many places the lines would last far longer than the bread. In those dark days, between us and a balanced budget stood millions of needy Americans, denied the promise of a decent American life.

To balance our budget in 1933 or 1934 or 1935 would have been a crime against the American people. To do so we should either have had to make a capital levy that would have been confiscatory, or we should have had to set our face against human suffering with callous indifference. When Americans suffered, we refused to pass by on the other side. Humanity came first.

No one lightly lays a burden on the income of a Nation. But this vicious tightening circle of our declining national income simply had to be broken. The bankers and the industrialists of the Nation cried aloud that private business was powerless to break it. They turned, as they had a right to turn, to the Government. We accepted the final responsibility of Government, after all else had failed, to spend money when no one else had money left to spend.

I adopted, therefore, the other alternative. I cast aside a do nothing or a wait-and-see policy.

As a first step in our program we had to stop the quick spiral of deflation and decline in the national income. Having stopped them, we went on to restore purchasing power, to raise values, to put people back to work, and to start the national income going up again.

In 1933 we reversed the policy of the previous Administration. For the first time since the depression you had a Congress and an Administration in Washington which had the courage to provide the necessary resources which private interests no longer had or no longer dared to risk.

This cost money. We knew, and you knew, in March, 1933, that it would cost money. We knew, and you knew, that it would cost money for several years to come. The people understood that in 1933. They understood it in 1934, when they gave the Administration a full endorsement of its policy. They knew in 1935, and they know in 1936, that the plan is working.

…And now a word as to this foolish fear about the crushing load the debt will impose upon your children and mine. This debt is not going to be paid by oppressive taxation on future generations. It is not going to be paid by taking away the hard-won savings of the present generation.

It is going to be paid out of an increased national income and increased individual incomes produced by increasing national prosperity.”

It’s a great speech, filled with all the rhetoric a lot of us would love to hear today.I particularly enjoyed the explanatory pieces, which speak to the people like adults and doesn’t use improper metaphors.

There is one little problem with all this, however. Under pressure from the fiscal hawks of the day, FDR cut the budget in his second term and the country went back into recession.

The Recession of 1937–1938 was a temporary reversal of the pre-war 1933 to 1941 economic recovery from the Great Depression in the United States. Economists disagree about the causes of this downturn, but agree that government austerity reversed the recovery from the 1929 Crash. Keynesian economists tend to assign blame to cuts in federal spending and increases in taxes at the insistence of the US Treasury, while monetarists, most notably Milton Friedman tended to assign blame to the Federal Reserve’s tightening of the money supply in 1936 and 1937

Apparently, it’s too much to ask that anyone ever learns from previous mistakes — even the mistakes of our greatest leaders.

.

Coming around

by digby

Here’s some more good news, sort of, from Greg Sargent;

Yes, the ground is shifting on the debt ceiling — big time. From the new Washington Post/ABC News poll:

More than eight in 10 — including 80 percent of Republicans — say there will be serious harm to the U.S. economy if the government cannot continue to borrow money to fund its operations and pay its debts after Aug. 2.

That more than eight in ten — it’s actually 82 percent, according to the internals — is up 11 points since early June.

Evidently, the majority of Americans have suddenly, and without warning, stopped listening to budget expert Michele Bachman and have decided instead to believe everyone else from Barack Obama to Warren Buffet to the Pope instead. What good sense.

The Post poll also finds that more trust Obama over the GOP on the debt limit, 48-39, and that a big majority, 62 percent, favor addressing the deficit with a mix of spending cuts and tax increases.

That would be great news if the President’s offer at the moment for “dealing with the deficit” weren’t trillions of dollars in cuts to everything including SS, Medicare and Medicaid in exchange for some measly “revenue enhancements” that won’t even be felt by those who are being asked to make this “shared sacrifice.” (Not that these Very Important Producers won’t scream like little babies if it happens.)

The American people may have come around to the idea that a debt ceiling “deal” should feature spending cuts and tax increases, but I cling to the old fashioned notion that neither of those things make any sense at the moment, especially the spending cuts.(Tax increases on the wealthy could be reasonably done since they are already sitting on a pile of cash they aren’t spending, but for some reason I don’t think that’s what’s going to stick in this deal anyway.)They shouldn’t even be talking about deficit reduction with 9.2% official unemployment and a stillborn recovery.

But yes, it’s still good news that people at least now understand that default on the debt isn’t a good idea. We’re moving that boulder one centimeter at a time.

.

A simple creed that sums up the spirit of a zzzzzz

by digby

Do you sometimes get the idea that you were hallucinating throughout the year 2008? Here’s a little reminder from yesterday’s HuffPostHill. The first quote is from that lecture the 2012 Obama re-election campaign sent around this past week-end:

“One of the challenges of this generation is, I think, to understand that the nature of our democracy and the nature of our politics is to marry principle to a political process. That means you don’t get a 100% of what you want. You don’t get it if you are the majority; you don’t get it if you are in the minority.”

And this:

As you guys talk to your friends about getting involved civically, don’t set up a situation where you’re guaranteed to be disappointed. It’s part of the process of growing up.

HuffPostHill:

OBAMA 2008: Remember this?

“We have been told we cannot do this by a chorus of cynics who will only grow louder and more dissonant in the weeks to come. We’ve been asked to pause for a reality check. We’ve been warned against offering the people of this nation false hope.

But in the unlikely story that is America, there has never been anything false about hope. For when we have faced down impossible odds; when we’ve been told that we’re not ready, or that we shouldn’t try, or that we can’t, generations of Americans have responded with a simple creed that sums up the spirit of a people. Yes we can.”

Or, maybe not!

Funny.

In fairness, in the lecture, he did go on to explain that growing up and accepting that you can’t always get what you want doesn’t mean you aren’t principled, but that you are just pushing a boulder up a hill and other people are pushing it from other directions and it might slip back.

What’s wrong with his commentary is his telling those young people that they should see his argument as a template for their own role as engaged citizens. I can’t think of anything more antithetical to his message in 2008 than “don’t set up a situation where you’re guaranteed to be disappointed.” It’s actually rather stunning.

And it’s completely wrong in terms of the role of average citizens (and especially young activists) in the political process. They are supposed to push for what they believe in with passion and single minded commitment. They shouldn’t worry about “what can pass” congress or the limits of the political process. That’s the job of politicians and political hacks.

Clearly, the president is more than a little bit annoyed by liberals on the outside who are agitating for difficult change and expressing their ire at what they perceive to be his unwillingness or inability to fight for it. But it’s as much a part of the process as his meeting with John Boehner on the terrace and hammering out an agreement. It’s as much a part of the process as Boehner making deals with his own coalition and Obama and Pelosi making deals with theirs. It’s the responsibility of engaged citizens to agitate for what they believe particularly when the Party that represents them is not even publicly articulating their beliefs. Otherwise, it won’t get said at all. And if that’s the case, then these “necessary compromises” aren’t compromises at all, are they?

Presidents have had to face this before. As Dday wrote in this addendum to his earlier post on this subject, FDR was met with strong resistance from liberal activists when Social Security was passed as a lesser bill than they believed was necessary. But it was that energy, translated into hard core political involvement, that resulted in Social Security being strengthened and expanded over the years. Certainly, if left to the devices of cautious politicians, it’s doubtful that it would have happened on its own. The forces arrayed against it were formidable from the beginning — it’s not as if there’s any benefit in it for the donor class or the people who hire the politicians once their time in office is done.

As dday put it:

A man Barack Obama claims as a hero, Martin Luther King Jr., understood this. He famously said:

… One spoke to me one day and said, ‘Now Dr. King, don’t you think you’re going to have to agree more with the Administration’s policy. I understand that your position on Vietnam has hurt the budget of your organization. And many people who respected you in civil rights have lost that respect and don’t you think that you’re going to have to agree more with the Administration’s policy to regain this.’ And I had to answer by looking that person into the eye, and say ‘I’m sorry sir but you don’t know me. I’m not a consensus leader.’ [Laughter – Applause] I do not determine what is right and wrong by looking at the budget of my organization or by taking a Gallup poll of the majority opinion. Ultimately a genuine leader is not a searcher for consensus but a molder of consensus.

Politics cannot survive on incrementalists alone. It cannot survive with only an inside game, and a political science conception of the art of the possible. Ultimately it needs people on the outside who look at what the incrementalists have produced, and say “No.” It doesn’t make those people juvenile, it doesn’t make them unrealistic. It makes them an integral part of the democratic process.

If you want people to push the boulder up the hill — and come back again if it slips — they need to have the idealism and energy and passion that only comes from believing that your cause is worth fighting for over the long haul. Saying “don’t set up a situation where you’re guaranteed to be disappointed,” is hardly going to inspire that. President Obama sounds petulant in that video — complaining about the Huffington Post is beneath him — and telling everyone to lower their expectations is about as inspirational as lukewarm soup.

And it’s a very far cry from “now go out and make me do it.”

Or “yes we can” …

.

Picking some good fights: good news edition

by digby

Ok, time for some good news for a change. Kudos to the administration for this one because it’s likely to provoke a fight — a fight that will be good for liberal;s to have:

Virtually all health insurance plans could soon be required to offer female patients free coverage of prescription birth control, breast-pump rentals, counseling for domestic violence, and annual wellness exams and HIV tests as a result of recommendations released Tuesday by an independent advisory panel of health experts.

The health-care law adopted last year directed the Obama administration to draw up a list of preventive services for women that all new health plans must cover without deductibles or co-payments. While the guidelines suggested Tuesday by a committee of the Institute of Medicine are not binding, the panel conducted its review at the request of Health and Human Services Secretary Kathleen Sebelius. Administration officials have indicated that she will consider the recommendations and release proposed regulations very soon.

Though generally anticipated, the committee’s decision to include prescription birth control in its recommended list is controversial. Groups such as the Planned Parenthood Federation of America had argued that contraception is a basic form of preventive health care. In turn, groups such as the Family Research Council contended that individuals who oppose birth control on religious grounds should not be effectively forced to subsidize its use by paying premiums to insurance plans that cover it.

This one is still under the radar, but it’s a very big part of the right wing assault on women’s rights taking place all over the country. This will be a full blown federal counter attack. And it’s one that should have a higher profile because liberals will win it.

Update:

More good news:

Metro Weekly: The president has said in the past that he opposes the Defense of Marriage Act, but he is yet to endorse the Respect for Marriage Act, which is the specific piece of legislation —

Carney: Senator [Dianne] Feinstein [(D-Calif.)], yeah.

Metro Weekly: — aimed to repeal the bill. Tomorrow, the Senate will hold the first hearing into that bill. Is the administration ready to endorse that bill?

Carney: I can tell you that the President has long called for a legislative repeal of the so-called Defense of Marriage Act, which continues to have a real impact on the lives of real people — our families, friends and neighbors. He is proud to support the Respect for Marriage Act, introduced by Sen. Feinstein and Congressman [Jerrold] Nadler [(D-N.Y.)], which would take DOMA off the books once and for all. This legislation would uphold the principle that the federal government should not deny gay and lesbian couples the same rights and legal protections as straight couples.

If Obama endorses Feinstein’s specific legislation, that seems to me to be a big deal. Good for him.

.

Housekeeping Note

by digby

If you have been trying to contact me at digby at writeme.com you should know that it’s apparently been going into the memory hole for quite some time due to a bizarre technical glitch. I can’t even imagine how much I’ve missed, but it’s probably a lot.

My new email address is digbysez at gmail dot com. Please update your address books. How am I to know how much you loathe me otherwise? 😉

.

Talkin’ Turkey

by digby

I think it’s time to admit that the president has, in fact, used the bully pulpit quite effectively. The latest Gallup report shows that his leadership has brought the public along quite well on his favored policies — compromise and deficit reduction:

Two-thirds of Americans would like government officials to agree to a compromise plan on the debt and budget deficit negotiations now underway. Fewer than 3 in 10 want lawmakers who share their views on the debt and budget deficit to hold out for their desired plan. A majority of Republicans, independents, and Democrats favor reaching a compromise…

Americans continue to express a strong desire that any agreement that is reached include plans for major cuts in future spending. Americans now by a 20-point margin — 55% vs. 35% — say they worry more that the government would raise the debt ceiling without plans for major spending cuts, than that the government would not raise the ceiling and an economic crisis would ensue.

Americans appear to be saying to their elected representatives: Get an agreement done, even if it is not an ideal plan, but make sure it includes major spending cuts.

The ongoing negotiations in Washington suggest that leaders on both sides of the aisle are attempting to heed public opinion. The sticking points are matters of degree — how major the spending cuts will be, and whether the spending cuts are accompanied by some type of concomitant tax increase.

Remember that until the past few months, the raising of the debt ceiling was a pro forma vote, usually featuring a couple of cranks or comers making a speech and taking a protest vote. Nobody was ever “worried” that it would be passed without big spending cuts until the Republicans decided to use it as leverage — and the President signed on to this formulation. The national consensus on the necessity for huge spending cuts couldn’t have happened without him.

On the other hand, Greg Sargent is reporting that the Republicans are working feverishly to get their members on board with the McConnell plan:

The Senate Republican aide I spoke to says those who support the McConnell scheme as a plan of last resort are holding out for what might be called a “what now” moment. Here’s how this may play out: The House passes “cut cap and balance” today, it fails in the Senate over the weekend; and by Monday everyone finally realizes that there’s no way the White House and Congressional leaders will ever reach a deal exchanging spending cuts for revenue hikes. At that point, the aide predicts, everyone may throw up their arms and say, “what now?” It’s only then that House Republicans — who got their chance to vote Yes on spending caps and a balanced budget amendment — will realize that they have no choice but to pass the McConnell proposal.

Greg cites the fact that most Americans want a compromise on this, which I also think will have salience. But the fact that they are so adamant about spending cuts sounds as if they also want the Democrats to compromise on their requirement for tax increases if it comes down to the wire, no? If it falls apart without the big spending cuts, the Democrats will be blamed. What a hideous pickle.

McConnell is still on the table, but it looks as though a Big Deal is still the preferred outcome for the leadership of both parties, for obvious reasons — the Boehner and cantor know they have a once in a generation chance to get Democrats to take the lead on destroying the safety net (and the Ryan Medicare attack) while the Democrats are afraid of being blamed for refusing to cut spending. (Oy vey.) But who knows at this point? They are all taking public positions that may or may not be real as part of their negotiation/kabuki.

For instance Steny Hoyer just came out against entitlement cuts, which is great. Except I don’t believe it for an instant. Hoyer has long been on record as being for entitlement “reform.” Here’s Steny a couple of years ago:

House Majority Leader Steny H. Hoyer (MD) delivered the keynote address at a Bipartisan Policy Center forum, “Unprecedented Federal Debt: Putting Our Fiscal House in Order,” hosted by former Senator Pete Domenici at the St. Regis Hotel. Below are his remarks as prepared for delivery:

“If I were to guess the single most lasting lesson of our economic crisis, and if I were to spell it out in just five words, I would say: this is what debt does.

“The recklessness we have seen from so many consumers, and from Wall Street, found an echo in the recklessness of the federal government. For years, our government has lived far beyond its means—and we see now that when we over-rely on debt, things can turn very ugly, very quickly. If a fiscal meltdown comes, there will be no one to bail out America.

[…]

“Our third response is, by far, the most important. That is the structural response—the actions we must take to confront the imbalance between our commitments and our revenues that are driving us deeper into debt every year. We will not bring our debt down if we do not reform entitlements and rein in the rapidly rising cost of health care.

“I am glad that we have a President who sees it that way. His talk of a ‘grand bargain’ that encompasses issues from entitlements to health care to taxes shows a clear understanding of the tradeoffs and sacrifices that will be necessary. Given the gravity of our situation, we cannot afford to take any options off of the table, either on the spending or the revenue side.

Yeah, he’s really going to the mat for “entitlements.” I suspect he’s positioning himself to be able to “compromise”.

Update: And now the Gang of Six emerges from their coffins, which the press is portraying as very good news. It’s not:

Leaders of a bipartisan “Gang of Six” senators said Tuesday that they’re nearing agreement on a major plan to cut the deficit by more than $4 trillion over the coming decade in what could be a bold entry into a debate on the deficit long bogged-down by bitter partisanship.

The Gang of Six plan is separate from a politically freighted effort to lift the nation’s borrowing cap and avoid a first-ever default on U.S. obligations. President Barack Obama and Capitol Hill Republicans, however, have failed to reach an accord on what kind of spending cuts to pair with any increase in the borrowing cap as the government teeters toward a possible default in two weeks.
[…]
The Gang of Six plan calls for an immediate $500 billion “down payment” on cutting the deficit as the starting point toward cuts of more than $4 trillion over the coming decade that would be finalized in a second piece of legislation.
The idea is that a bipartisan plan would gain critical mass in the Senate, powered by the endorsement of conservatives like Coburn and liberals like Dick Durbin of Illinois, the No. 2 Democrat in the Senate and a member of the group.
Both Republican and Democratic leaders, however, remain wary of the effort, since it would raise revenues by about $1 trillion over 10 years and cut popular benefit programs like Medicare and Medicaid.

Yes, it’s the Simpson Bowles Obama formula.

But it also includes this “tax reform” proposal:

Like the deficit commission, the Senate group’s plan calls for a fundamental overhaul of the tax code that would slash special tax preferences and deductions as a way to lower tax rates — along the lines of the 1986 tax reform measure signed into law by President Ronald Reagan. In addition to skimming some of the revenue to reduce the deficit, advocates of the plan say it would spur the economy and fill federal coffers further because of such growth.

They are actually going to try to sell the fatuous magical thinking that deficit reduction plus tax cuts equals more revenue. (Then they’ll let us create a whole new shiny safety net, right?)

Here’s the President just now:

“We have a Democratic President and administration that is prepared to sign a tough package that includes both spending cuts, modifications to Social Security, Medicaid and Medicare that would strengthen those systems and allow them to move forward and would include a revenue component. We now have a bipartisan group of Senators who agree with that balanced approach. And we have the American people who agree with that balanced approach.”

He went on to say that he had sent orders out to Boehner and Pelosi and Reid and McConnell to “talk turkey” and get this done. And he acknowledged that the McConnell plan exists as a fall back. I’m still rooting for it more than ever.

.

Give him a bottle and put him to bed

by digby

I had been ignoring the the Paul Ryan and his 350 dollar bottle of wine story because well — it’s been well covered elsewhere and I had nothing of interest to add to it. But Jonathan at A Tiny Revolution brings a new dimension to the story that I haven’t seen before:

It’s confusing to see the snarling red faces of America’s financial overlords. Of all the people on earth, what do they have to be angry about? They almost obliterated the world economy, and as punishment, we opened up the U.S. treasury and told them to haul off as much as they could carry. Meanwhile, everyone else is just praying the Medicare age won’t be raised beyond 82.

However, their fury makes perfect sense if you understand that they live inside an all-enveloping fantasy world. You may have seen that Paul Ryan was recently spotted downing two $350 bottles of wine with Cliff Asness, a hedge fund manager. When a woman approached and criticized them for that kind of extravagance as Ryan plots to slash all social spending, Asness apparently said to Ryan “fuck her.” Asness was previously known for staging a memorable public freakout about the Obama administration’s bailout of Chrysler in an open letter titled “Unafraid in Greenwich, Connecticut.”

So far so normal in 2011. But I don’t think anyone’s noticed this, from Asness’s bio on his company’s website:

He received an MBA with high honors and a Ph.D. in Finance from the University of Chicago where he was Eugene Fama’s student and teaching assistant for two years (he is still respectfully scared of Gene).

In other words, Asness is a protege of Fama, who’s an extremely schmancy figure in right-wing economics. (And John Cochrane, a University of Chicago finance professor who was also eating with Asness and Ryan, is Fama’s son-in-law.) This is the milieu in which Asness spends his days.

And here’s the significance of that: Fama was recently spotted confidently telling everyone that the sky is green:

But suppose we buy into the more common negative current view of finance. There is still a big open question. Beginning in the early 1980s, the developed world and some big players in the developing world experienced a period of extraordinary growth. It’s reasonable to argue that in facilitating the flow of world savings to productive uses around the world, financial markets and financial institutions played a big role in this growth. Despite any role of finance in the current recession, are the market naysayers really ready to argue that worldwide wealth would be higher today if financial markets and financial institutions didn’t develop as they did?

I urge you to read on as to why that Bizarroworld statement is not just false, but delusional. And there’s lots more about Asness, a jackass of the highest order.

Update: Here’s a little reminder of that big baby’s temper tantrum back in 2009.

Let’s also mention only in passing the irony of this same President begging hedge funds to borrow more to purchase other troubled securities. That he expects them to do so when he has already shown what happens if they ask for their money to be repaid fairly would be amusing if not so dangerous. That hedge funds might not participate in these programs because of fear of getting sucked into some toxic demagoguery that ends in arbitrary punishment for trying to work with the Treasury is distressing. Some useful programs, like those designed to help finance consumer loans, won’t work because of this irresponsible hectoring.

Last but not least, the President screaming that the hedge funds are looking for an unjustified taxpayer-funded bailout is the big lie writ large. Find me a hedge fund that has been bailed out. Find me a hedge fund, even a failed one, that has asked for one. In fact, it was only because hedge funds have not taken government funds that they could stand up to this bullying. The TARP recipients had no choice but to go along. The hedge funds were singled out only becausethey are unpopular, not because they behaved any differently from any other ethical manager of other people’s money. The President’s comments here are backwards and libelous. Yet, somehow I don’t think the hedge funds will be following ACORN’s lead and trucking in a bunch of paid professional protestors soon. Hedge funds really need a community organizer.

Boo fucking hoo. There are literally no greater Rodney Dangerfields than the vastly wealthy masters of the universe. I tell ya they get no respect. All they have in life is their money and privilege. Can you really blame them for needing to soothe their hurt feelings with a nice 350 dollar bottle of wine and a mellow evening with a fellow Randroid fool once in a while?

.