Month: July 2011

The center is a moving target

by digby

Krugman:

Watching our system deal with the debt ceiling crisis — a wholly self-inflicted crisis, which may nonetheless have disastrous consequences — it’s increasingly obvious that what we’re looking at is the destructive influence of a cult that has really poisoned our political system.

And no, I don’t mean the fanaticism of the right. Well, OK, that too. But my feeling about those people is that they are what they are; you might as well denounce wolves for being carnivores. Crazy is what they do and what they are.

No, the cult that I see as reflecting a true moral failure is the cult of balance, of centrism.

Think about what’s happening right now. We have a crisis in which the right is making insane demands, while the president and Democrats in Congress are bending over backward to be accommodating — offering plans that are all spending cuts and no taxes, plans that are far to the right of public opinion.

So what do most news reports say? They portray it as a situation in which both sides are equally partisan, equally intransigent — because news reports always do that. And we have influential pundits calling out for a new centrist party, a new centrist president, to get us away from the evils of partisanship.

The reality, of course, is that we already have a centrist president — actually a moderate conservative president. Once again, health reform — his only major change to government — was modeled on Republican plans, indeed plans coming from the Heritage Foundation. And everything else — including the wrongheaded emphasis on austerity in the face of high unemployment — is according to the conservative playbook.

What all this means is that there is no penalty for extremism; no way for most voters, who get their information on the fly rather than doing careful study of the issues, to understand what’s really going on.

You have to ask, what would it take for these news organizations and pundits to actually break with the convention that both sides are equally at fault? This is the clearest, starkest situation one can imagine short of civil war. If this won’t do it, nothing will.

He goes on to say that this is a moral problem on the part of the Villagers who refuse to abandon their pose of being “above the fray.” That is a problem. But when you think about it, why should they? The majority of Democrats, including self-described liberals, are going along with the charade that the Executive Branch has no power and that “balance” and “compromise” are liberal principles, so there’s no reason to believe that the center point isn’t between Obama and the tea party. In point of fact, it now is.

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Serious people

by digby

Now they’re talking turkey:

Majority Leader Eric Cantor (R-Va.) on Tuesday bluntly told House Republicans to stop “grumbling and whining” about Speaker John Boehner’s (R-Ohio) new proposal for a limited debt-limit increase.

Cantor made the statement in a closed-door conference meeting, a Republican with knowledge of his remarks told The Hill.

Boehner and Cantor are trying to rally restive members of their caucus behind a plan that would authorize up to $1 trillion in new debt in exchange for $1.2 trillion in spending cuts and the promise of more in the future.

Some conservatives have balked at the proposal, however, and Boehner could not guarantee on Tuesday morning that the bill would pass the House, given Democratic opposition.

In the closed-door meeting Tuesday, Cantor praised Boehner’s leadership and acknowledged that “the debt-limit vote sucks.” But he told lawmakers they had only three choices: allow the country to default on Aug. 2, pass a Senate bill that Boehner has denounced as “full of gimmicks” and a “blank check” for President Obama or support the GOP leadership and “call the president’s bluff.”

Cantor “said to stop grumbling and whining and to come together as conservatives and rally behind the speaker and call the president’s bluff,” the Republican with knowledge of his remarks said.

It looks like Lil’ Eric may have over-stimulated his troops. It will be interesting to see how the Tea Partiers react to being scolded by one of their own. For a clue, here’s Erick Erickson:

The Democrats and Republicans in Washington may be trying to compromise, but they just aren’t that serious. They really aren’t. And now a bunch of House Republicans are going wobbly, backing down from holding the line, and willing to take John Boehner’s plan — a compromise wherein they are compromising only with themselves.

According to Forbes, a ratings downgrade would be worse than a technical default. Unfortunately, sources who have spoken to Standards & Poor tell CNN’s Erin Burnett that John Boehner’s plan — the one Allen West and others are lining up to support — would cause the U.S. to lose its AAA credit rating.

Why? No, ti has nothing to do with John Boehner embracing the McConnell idea of letting the President raise the debt ceiling without congressional approval and then letting Congress vote to “disapprove”. But it does that too.

No, it’s because the credit reporting agencies have said the U.S. Congress must show real cuts of $4 trillion or more. John Boehner’s plan doesn’t even come close in real dollar terms — excluding accounting gimmicks the credit agencies are not buying. John Boehner’s plan could best be called “Punt, Kick, and Pass.” It punts the problem to another stupid commission, kicks the can down the road, and passes more debt onto future generations.

So here is the great conundrum for the House GOP. Reid’s plan cannot pass the House. John Boehner’s plan probably can. Ultimately, John Boehner’s plan and Harry Reid’s plan are pretty close and both would probably result in a credit downgrade.

So this has now it’s all about saving the country from a credit downgrade — which has never been a serious issue before and is, in fact, complete bullshit. But reality left the building some time ago.

Now Boehner has to re-write his own plan because the CBO says it only saves 850 billion.

I think it’s time to start drinking.

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Over the falls
by David Atkins (“thereisnospoon”)

Fans of Sir Arthur Conan Doyle’s Sherlock Holmes stories will be familiar with the legendary The Final Problem, which documents Sherlock Holmes’ final confrontation with his nemesis, the villainous Professor Moriarty. In the conclusion of the story in which our master detective is supposed to have met his end, Sherlock and Moriarty duel in a wrestling match to the death on a cliff overlooking the treacherous Reichenbach Falls. Moriarty would not rest until Sherlock were killed, and Sherlock would not rest until Moriarty were captured. With neither man willing to cede the struggle to the other, they both are supposed to have pitched over the edge, locked arm in arm to the death.

It’s an apt metaphor for what might happen in a world where Democrats were everything we wanted to them to be as we approach a default on the full faith and credit of the United States.

Let us imagine for a moment that we were to live in an alternate universe, one where every Democrat in Congress had a firm resolve and unbending backbone, and where the President of the United States were a true believer in the power of Keynesian policy, and an opponent of giving even an inch to the conservatives looking to dismantle the safety net. And let us presume that in this alternate universe, all Democratic officials from county selectman to President of the United States were incorruptible servants of the public good, unbeholden to corporate donors.

If this pleasant fantasy were made real, what might happen? Well, one might argue that the nation would never have been brought to this point. And there’s a good reason to make such an argument. But in the absence of extending our fantasy to revision of history, what might transpire in our alternate universe as we approach default?

The answer, unfortunately, isn’t much better than in our actual, corrupted universe.

The reality is that no matter what our political beliefs and strength of will might be, rational people in public policy know that the default ceiling must be raised. Defaulting on the full faith and credit of the United States is simply not an option.

But at least a very sizable portion of Congressional Republicans are simply not rational, but belong to a market fundamentalist cult. They would rather see fiscal Armageddon than a compromise of their ideology in any way, shape or form.

Today’s news brings yet more evidence of the same: John Boehner has introduced a preposterous plan to cut $1.8 trillion, including cuts to core entitlements like Social Security, Medicare and Medicaid. The plan is already dead-on-arrival in the Democratic Senate and on the White House desk. Even in our imperfect Democratic establishment, this plan has zero chance of passing. And yet Boehner’s biggest headache is not Democrats, but members of his own caucus, who feel the plan does not go far enough. Michele Bachmann, who readers should be reminded is leading the field of potential Republican aspirants to the Oval Office, has already declared that she and her allies will not vote for any increase in the default ceiling that does not include equal cuts to discretionary spending.

So if you are Democrat in our perfected alternate universe, what do you do? No vote to raise the ceiling is valid absent a vote of the Republican House, “Constitutional options” notwithstanding. Theoretically, you lay down a marker that starts your negotiating position at a clean increase in the ceiling. To which the zombie death cult responds that they won’t vote for anything less than $2 trillion in cuts, including to basic entitlement programs.

Now what? Do you wait for market jitters and Wall St. overlords to bring the Republicans back in line? Wall St. types have already met in secret with Boehner and said that they were OK with small tax increases, but begged him to just make sure the default ceiling got raised already, so that their precious portfolios would be protected. Boehner knows the stakes. But the Teahadist wing of the GOP, about 60 Congressmembers strong, doesn’t respect John Boehner much more than they do Nancy Pelosi. Boehner knows that he’s already on his last legs with his caucus, and that Eric Cantor is just waiting for the opportunity to ease the Speaker into his political grave

Most of these people are openly or secretly hoping for the sort of Armageddon that they believe will finally destroy the welfare state once and for all in America–no matter the cost. Nor is it just the the conservative reps in Congress: a major portion of the GOP base wants no compromise whatsoever, even as the vast majority of the Democratic base believes that compromise is the best route. For a Democrat, there is little political risk in compromise. For a Republican, any wavering or compromise will likely be met with a primary challenge from Grover Norquist. As a Democrat, do you take the risk that the GOP will panic and see reason? Or do you risk instead that they double down, forcing you to give them the money in the hopes they don’t shoot the hostage?

In short, do you let Professor Moriarty walk, knowing full well it probably means your death shortly thereafter but at least gives you a chance of survival, or do you lock arm in arm with him, plunging straight over the falls? You know only one thing: Moriarty will see it through to the end, either way. Or to use another, more ancient parable, do you allow the baby to be cut in two, or do you give it to the false mother in the hope that the American People will stand in judgment and award you custody of the economy in the future?

Unfortunately, this isn’t fiction, Sherlock doesn’t have a secret grappling move to ensure his survival at Moriarty’s expense, the American voter isn’t nearly as wise as King Solomon, and we don’t live in an alternate universe of Democratic perfection. This is the real world.

And in the real world, the choices are looking pretty grim.

Help wanted: Beggars, prostitutes and thieves

by digby

A recent review of job vacancy postings on popular sites like Monster.com, CareerBuilder and Craigslist revealed hundreds that said employers would consider (or at least “strongly prefer”) only people currently employed or just recently laid off.

Unemployed workers have long suspected that the gaping holes on their résumés left them less attractive to employers. But with the country in the worst jobs crisis since the Great Depression, many had hoped employers would be more forgiving.

“I feel like I am being shunned by our entire society,” said Kelly Wiedemer, 45, an information technology operations analyst who said a recruiter had told her that despite her skill set she would be a “hard sell” because she had been out of work for more than six months.

Legal experts say that the practice probably does not violate discrimination laws because unemployment is not a protected status, like age or race.

That’s one way to keep the unemployment rate high and wages low. And the new austerity should help matters greatly. Obviously our policy makers believe that the country is in desperate need of more beggars, prostitutes and thieves. Those are jobs that are being created anyway.

I have a business idea. Who wants to incorporate and and sell themselves to jobless people as their “current job” for resume purposes? You could just charge a little fee if the person gets the job. Why not? It’s no more immoral than saying people shouldn’t be allowed to work if they aren’t already working.

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This is how they do it

by digby

George Will is an ass. But he isn’t a stupid ass, which is why this column today is such a good example of right wing tactics.

We all know that Barack Obama is not a populist. Defend him or criticize him, love him or hate him, it’s clear that he’s a technocratic mediator, a deal maker and an economic centrist at best. This may be pragmatic or ideological — I do not know his heart. But there is one thing that’s quite clear in all this and it’s that he is about as close to being Huey Long as Andrew Breitbart is to being Edward R. Murrow. They sometimes use the same words, but they are speaking a very different language.

Will is doing a political job here, not an analytical one. He is serving the party with which he identifies by drawing a very tortured comparison between a Democratic president who proposed to cut trillions of dollars in spending in an economic downturn, who willingly put the New Deal and Great Society safety nets on the table as negotiating chips and is literally begging the Republicans to take him up on it — and someone most people think of as a power-hungry, populist demagogue. The mere idea of the President using the executive branch for domestic initiatives is portrayed as offensive to democracy and the separation of powers, which is very convenient at a time like this (and a rule only in force during Democratic administrations.)

He is, of course, speaking to the Village, his home and only sphere of influence. Nobody in the country cares what he thinks. He’s helping move the goalposts for the party, but he’s also giving the Village media the way to excuse the insane behavior of the Republicans. This is his job.

There are conservative pundits who think for themselves and answer only to their readers and their consciences. George Will is not one of them. He’s an operative and a very sophisticated one at that. And he’s got his job cut out for him. If he’s reduced to something this surreal and cartoonish it’s a sign that they are truly getting desperate to find a way to explain what’s become a tragic farce.

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Proud to be an American, Where At Least I Know I’m Free
by David Atkins (“thereisnospoon”)

About a month ago I was met with an unfortunate occurrence. Somehow, in the process of drinking an iced tea with small granules at the bottom, I awkwardly swallowed a larger-than-usual granule. Having had a tonsillectomy and adenoidectomy in my youth, I have occasionally had the annoying misfortune of getting foreign objects lodged in the passage between the nose and throat. The granule felt as if it had found the same unhappy spot.

But unlike in past circumstances, the granule did not seem to dislodge. After taking steps to flush my sinuses and research the subject online, I came to the conclusion that it might simply be a scratch. But it certainly felt as though there was an object there, and I was having a sinus reaction accordingly. Unfortunately, it was also 8 o’clock in the evening, which meant that I had two choices: stick it out until morning and see a regular physician, or head to the emergency room. I’m not the type to go to the emergency room for colds or flu; I tend to use medical services sparingly. But the discomfort was intense. After much internal debate, I decided to go to the emergency room. After all, I was having a physical reaction to whatever it was that was making basic swallowing difficult. I have insurance, and whether it were a foreign object or just a scratch, it couldn’t be too complicated or expensive.

I knew it would take some time to be seen; after all, my case was probably the least critical they had. So I brought a book and settled in for the long haul. After 3 hours waiting on the floor of the emergency room without even a chair to sit in, I was finally admitted. A harried doctor examined me for approximately 30-90 seconds with a regular scope, said he couldn’t see anything but that there might still be blockage that he was unequipped to detect, said there was nothing else he could do, and sent me on my way. The actual visit took less than two minutes.

Today I got my bill. The total? $371. $371 for a three-hour wait, followed by a two-minute visit, with no procedures of any kind performed. And that’s with pretty decent insurance.

This story should be an outrage. But, of course, it isn’t. It’s a completely typical occurrence in modern America, a most trivial complaint in a sea of raging injustice that bankrupts hundreds of families every day for the crime of having gotten sick.

But here’s the rub: even such a trifling issue as the one I’ve described can serve an object lesson in the failure of conservative economics. I run a small business; most the work I do is performed in-house, but I do often employ subcontractors. The degree to which I employ them is predicated on demand: i.e., whether I can keep up with the workload without losing income by farming it out to others.

With an unexpected $371 to pay, I will be forced to take on more work myself, and be stingier about hiring a subcontractor. That decision will have a domino effect on all sorts of businesses and services that I and my subcontractors might use. In its own small way, it’s a hit to economic growth.

But conservatives expect that I should be grateful for keeping my corporate tax rates low, even though those tax rates make almost zero impact on whether I hire a subcontractor or not. Remember: it’s demand that drives hiring, not tax rates. Either there’s too much work for me to handle comfortably or there isn’t. A marginal difference to my tax percentage on end-of-year profits makes essentially zero difference to my hiring decisions.

But that $371 medical bill certainly does. To say nothing of the fact that it will dissuade me from seeing a physician next time something goes wrong–and that next time it might just be serious.

So thanks, conservatives, for fighting against a decent healthcare system to keep my corporate taxes low! You’ve done a great service…for somebody. But not for me as a small business owner. And not for my employees and subcontractors. And not for this country, which still yearns to be free of your small-minded, economically ignorant tyranny under the guise of “freedom from taxes.”

We’re all disaster capitalists now

by digby

We’ve been following the British austerity experiment here for the past few months in fits and starts. The early indications were that it was a disaster.

Dday fills us in today on the latest news which showed a horrible 0.2% growth in the second quarter (probably to be downgraded) after a previous two quarters of essentially zero growth. They are blaming it on Will and Kate and the Japanese Tsunami!

The excuses in this article are ridiculous: did the economy slow down because a lot of people missed the Tube stop at Notting Hill, too? Anyway, didn’t the William and Kate wedding produce a lot of economic activity?

The point is that Britain rolled back demand during a time when the economy was already weak, and they are suffering through the consequences. Instead of looking at this as a problem to be avoided, US policymakers are on the verge of emulating it. And not even in a good way: the British plan was at least somewhat balanced, with tax increases along with the spending cuts. This shows that the idea of a “balanced approach” is still flawed, because either way, you’re reducing demand during a time with a demand shortfall.

What’s most interesting to me about this is that the the Tories formed a coalition with the centrist Liberal Democratic party to put this program in place. Let’s just say the similarities between their governing coalition and ours is pretty clear, although in their case the Prime Minister is admittedly conservative. I’m guessing they’re searching madly for green shoots with a magnifying glass even as we speak.

Yesterday eventheliberal Nancy Pelosi said, “it is clear we must enter an era of austerity; to reduce the deficit through shared sacrifice.”

We are all disaster capitalists now.

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Render Unto Caesar
by David Atkins (“thereisnospoon”)

Yesterday famed “Christian” pastor Rick Warren, wealthy author and megachurch leader, tweeted the following:

HALF of America pays NO taxes. Zero. So they’re happy for tax rates to be raised on the other half that DOES pay any taxes.

After a firestorm ignited decrying this egregious mix of selfishness and ignorance, Mr. Warren deleted his tweet. But the screenshot is preserved for Internet eternity.

It obviously doesn’t bear repeating for the thousandth time that, in fact, poor people do pay all sorts of taxes: FICA, sales, social security and wide range of others. It is true that the federal income tax is progressive. But it is the exception rather than the rule. The poor and middle class in this country still pay a greater share of their overall income in taxes than do the wealthy, who pay a lower effective rate than the rest of us when all is said and done.

But it’s one thing for a cigar-smoking businessman to make this argument. That would be tolerable from a certain point of view. But it’s particularly galling coming from a man who considers himself a man of the cloth, and who has become quite wealthy partly off a megachurch business that pays no taxes itself. It would be more than a stretch to think that Jesus Christ would have advocated that the poor pay higher taxes at a time of record income inequality, so that the rich might feed more heartily from the trough. Also, have they genetically engineered tiny camels that can pass through needle’s eyes yet? We’re clearly going to need a lot of them when all these ultra-wealthy “Christians” shed this mortal coil.

Far be it from an agnostic deist like me to suggest that “Pastor” Warren brush up on his Bible, but Matthew 23:27-28 might be relevant here:

Woe unto you, scribes and Pharisees, hypocrites! for ye are like unto whited sepulchres, which indeed appear beautiful outward, but are within full of dead men’s bones, and of all uncleanness. Even so ye also outwardly appear righteous unto men, but within ye are full of hypocrisy and iniquity.

There will come a point
by David Atkins (“thereisnospoon”)

Earlier today I listed a number of theories to explain President Obama’s behavior during the default crisis. Doing the bidding of wealthy contributors is plausible, but then why insist on raising their taxes? Making a robotic technocratic choice for budget restraint has merit as a theory, but then why not just let the Bush tax cuts expire, and why go for Social Security, which is irrelevant? Perhaps the most likely rationale is purely political: the President is going after independent voters in advance of 2012, and making choices based on the belief that these independent voters want to cut government spending.

But then, once again, why Social Security? And why insist on cutting so much from discretionary spending? Your average independent voter has no idea what the difference between one and two trillion dollars is when it comes to spending outlays. The numbers are too big to comprehend for most people. Why not lay down a marker at, say, $500 billion in spending, with no cuts to Medicare or Social Security, and then “give in” to allow for $1 trillion in cuts? That would prove his “spending cut” bona fides to independent voters just as effectively as his current approach, while giving Republicans the “win” they so desperately crave.

None of it makes much sense. The truth may be a combination of the three theories, but even then it doesn’t hang together. Unless you believe the final piece of the puzzle is that the White House actively wants progressives to howl with rage. I’ll let brooklynbadboy take it from here:

The President made it very clear he wants cuts to Medicare, Medicaid, and Social Security. Yes, the very Social Security that has nothing to do with the deficit. You don’t have to rely on “rumors” also known as “reporting.” He’s said it himself….

The president is seeking less revenue than the tax increases advocated by Sens. Saxby Chambliss (R-GA), Tom Coburn (R-OK), Mike Crapo (R-ID), Kent Conrad (D-ND), Mark Warner(D-VA), and Dick Durbin(D-IL). That’s an extremely conservative bunch, excepting Durbin, and Obama’s proposal was to the right of that. And don’t forget that bit of supply-side “dynamic scoring” stuff (emphasis mine) that is straight out of the GOP playbook. Again, don’t take it from me. Don’t take it from the “anti-Obama media rumor mill.” Don’t take it from foaming at the mouth, overreacting, racist, bigoted, irrational, pony and rainbow loving liberal bloggers. That’s from the President himself.

How did the president expect Democrats to react to his proposal?

brooklynbadboy then quotes the duly elected Democratic President of the United States:

But in the interest of being serious about deficit reduction, I was willing to take a lot of heat from my party — and I spoke to Democratic leaders yesterday, and although they didn’t sign off on a plan, they were willing to engage in serious negotiations, despite a lot of heat from a lot of interest groups around the country, in order to make sure that we actually dealt with this problem.

And then finishes with this:

He expected to take a lot of heat, not loving adoration.

If the presidents gets his big deal, he expects you, the Democrats, to be upset about it. Not cheering it. When and if he strikes a deal to cut Social Security, which has nothing to do with the deficit at all, which he himself says he is willing to do, he doesn’t expect you to respond by saying “GO OBAMA! CUT MY SOCIAL SECURITY! HOORAY!” He expects you to be plenty pissed about the Grand Bargain. He expects you to respond with HEAT.

Don’t take my word for it. Listen to the man himself. My message is “no need to worry, sir. I’m already there.”

This theory, combined with the President’s seeking the Independent vote in 2012, is the only one that actually makes sense. He wants the Left to be furious with him, as a proving point for his moderate and centrist chops. He wants the Right furious with him, too, which is why he’s holding out for minor revenue increases that don’t make that much difference in the long run, and don’t do much to address income inequality. The revenue increases are an inflexible part of the negotiation precisely because he knows the Right will go ballistic over them.

The entire intent of the Administration would be, under this theory, to make both sides go ballistic so that the Administration can look like the only adult in the room to independent voters. Cutting Social Security is precisely designed to make the Left visibly cry out in anguish. And they’re counting on the idea that the Republican market fundamentalist cult will so terrify the vast majority of Democrats come election season that they’ll dutifully pull the lever for the Administration no matter what. They may be right. The President’s fundraising total from small donors does seem to reflect a broad range of committed support.

But I wouldn’t take that bet. As an activist on the ground, I can see firsthand how dispirited many of our core volunteers are at this stage. How long can the Democratic Party run headlong from its base even as Republicans eagerly rush to embrace theirs, before the liberal base gives up and goes home even if it means Michele Bachmann in the White House? It seems the President and his advisers are willing to test those limits. Time will tell if it blows up in their faces in 2012, or if they are vindicated.

I’m just not sure which result would be the worse for the country.

Where ya gonna go?

by digby

Ed Kilgore has a thoughtful piece in Salon about why liberal elites are so angry and why they have so little influence on the White House. It’s the numbers, basically. president Obama still has the support of the vast majority of the Democratic party and the activist liberal base is unlikely to sit out the election. (And even if we did, it probably wouldn’t make much of a difference.)

He brings up something in this that I think is an overlooked piece of this puzzle and one which I tried to write about in 2008 but the environment was so hostile that I gave it up:

Next time there is an open Democratic presidential nomination contest, the organized left will almost certain to make far greater ideological demands on candidates, and make a far less speculative choice of a favorite, than it did in 2008.

It will be unlikely that we’ll ever have the kind of leverage we had in 2008, with two candidates neck and neck for the nomination up to the very end and a totally pathetic opposition, unfortunately. But if liberals had resisted the urge to turn that primary into a season of American Idol, there might have been a chance to shape the administration in ways that would be difficult for him/her to escape.

Spilled milk. And for a variety of reasons 2012 is not a hospitable election for a primary challenge, regardless of how disappointed liberals are in the president. But the activist base and elite liberals are the tip of the spear. Being honest about what we see still has a purpose: to keep liberalism alive, motivate the base for other elections, build the progressive movement. And the activist base and liberal elites will have a hand in determining the president’s legacy. Once he’s done catering to these alleged Independents who want nothing more than to slash government to the bone, he’s going to start thinking about that.

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