Month: August 2011

Dean Baker jabs Steve Forbes in his animal spirits

by digby

Small d inspiration

by digby

These are very tough times and I am starting to see a lot of depression and fatalism and anger from people everywhere. I don’t think I’ve ever seen the left so despondent — and nights like last night in Wisconsin, although heartening in some respects, often make us feel worse because it takes so much energy just to move an inch. But I have to remind myself that it’s about more than just achieving the goal — it’s the process itself that makes you strong.

Here’s a note I got from reader Don P, who sent me the Stagecoach quote last week:

I know we are in dark times and the nature of the quote was not bright, however seeing that happen was very satisfying and put a bounce in my step. Saturday, when the item appeared in Krugman’s column my union voted to approve a contract with Santa Clara County.

I was one of the negotiators and though contract contains cuts to the workers, I feel proud of what the negotiators accomplished. We negotiated from April 29th until 6:30 AM on August 3rd. It was grueling but we kept the worst pain from the lowest paid employees and tried to make the cuts as temporary as we could. We also avoided impasse and a strike.

I felt so incredibly proud that day of both achievements (contributing to your BLOG and successfully settling).

I also wish more people understood how democratic, ethical and downright American union work can be. We worked so hard to get all the voices heard, to discuss all the angles and represent the stated interests of the workers. The negotiation team practically tore itself apart but the sum of all this messy, difficult process was a contract that was as fair as possible under the circumstance. It felt like democracy in action and it gives me hope even in this dark time.

I want to galvanize people and get them involved civically with the kind of passion that the Tea Party has but oriented towards working on constructive solutions to the problems we face.

As long as people like Don are out there doing what they can for average working people, I figure I can’t succumb to the malaise that threatens to drag me under. I imagine there was some disappointment in Wisconsin last night that they didn’t take back the Senate. But they won two races — a very difficult task — and I doubt even one of the people who worked so hard to make that happen would give up having had the experience. As Don says, it’s difficult and exhausting, but the real fulfillment is in the doing of it. (And, by the way, practice makes perfect.)

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Hide the bunnies

by digby

Well, what am I supposed to do? You won’t answer my calls, you change your number. I mean, I’m not gonna be ignored, America!

After a more than two-month hiatus, former Alaska Gov. Sarah Palin is planning to crash the presidential party once again with a heartland-themed re-launch of her “One Nation” bus tour this week in Iowa, according to a Palin fundraising email obtained by CNN.

Palin is bringing her Constitution-draped bus to the Iowa State Fair, just 30 miles south of where the Republican presidential field will take the stage on Thursday for a presidential debate in Ames.

It’s not yet clear which day the tour begins, but her surprise arrival in Iowa will happen before the closely watched Ames straw poll. Palin is not on the straw poll ballot.

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No, they will never learn

by David Atkins (“thereisnospoon”)

In case anyone was wondering if there would come a point at which basic reality would send a wake-up call to blinkered Tea Party conservatives, you have your answer in the Great State of Texas. Specifically, the town of Kemp, population 1,133:

Water is flowing again from faucets in the town of Kemp.

Now, city leaders hope prayer will provide them with rain.

Water had been cut off in this Kaufman County town of 1,200 since Saturday. On Tuesday night, residents assembled at a local park to pray for rain — a vigil organized by town leaders.

“In Jesus’ name, we will have water and rain, and that all our problems here in Kemp will be solved and managed,” said one Kemp resident in prayer.

Jeff Culber works for the Kemp Housing Authority. In his prayer, he actually offered gratitude for the problems that caused the water shutdown.

“I want to thank You that these water lines have busted,” he said. “It has brought this circle of unity together to come to You and ask You for the resources to fix it…”

“I know that the answer is prayer. And that’s where the rain comes from… He’s the rainmaker,” said Kemp resident Nancy Schoenle.

In the philosophy of religion, the explanation of random suffering as a net plus because it causes other social benefits is called a “greater goods” argument. Greater goods arguments are roundly mocked by anyone who has thought very deeply about the subject. But deep thought isn’t the forte of the residents of Kemp, or else they wouldn’t have water problems in the first place. It turns out that what the government giveth, the refusal to invest in infrastructure taketh away. Thank God John Thorpe has some earthly answers for the town:

Their infrastructure dates back to the 1930s. Most of the water system’s 30 miles of pipes haven’t been updated in decades.

It was these old, shoddy pipes that led directly to the water shortage and shutdown in Kemp. The heat wave that has gripped the southern United States for a month now taxed the system, and the pipes, which should have been updated recently but were not, burst. In the past three weeks, there have been fourteen separate water main breaks in Kemp.

“It’s sad to say, but it’s poor planning,” said Kile, who was elected mayor recently. “When they put that water treatment plant in, they should have implemented something then… it just wasn’t ever done.”

One resident had her own take on the water shutoff, and some words for…god only knows who.

“You tell them this old woman is hot down here — and not just because of the heat!” she yelled. “It’s 107 degrees in my blood, because you people… down there won’t get off your duff and fix this stuff!”

Mayor Kile is certainly trying. The city is currently spending $350,000 to replace 4,000 feet of pipe. That’s hardly going to make a dent in the problem today, and there may not be funding available for more repairs just yet. The city is represented in Congress by a Tea Party favorite, House Republican Conference Chairman Jeb Hensarling.

Meanwhile, Kemp’s residents are without water in the middle of a non-stop, 100-degree-plus heat wave. While they wait and wonder when they’ll be able to drink again, Kemp’s residents have had plenty of time to reflect on what they learned by the circumstances.

Or will they? The town ran out of water last year, too. They spent three days with the water shut off as officials, once again, prayed for help.

There is no reality that will wake these people up. They will dance to the Tea Party tune right back to the Middle Ages if they’re given a chance, without once even looking back to see what alternatives actual civilization might provide.

If the town of Kemp wants to revert to the era of witch burning and dowsing rods, that’s ultimately their business in a democracy. At this point I’m inclined to say “go for it” and encourage anyone with half a lick of sense to get out of Dodge. The problem is that these people want to shove Rick Perry down our throats, and force the rest of us to jump off the ledge with them while our tax dollars support their unsustainable lifestyle.

There is no compromise with these people. You either defeat them, or separate political ties with them. Compromise isn’t an option.

A stopped clock called Michele

by digby

Michele Bachmann has caused quite a stir today with yet another of her looney claims:

BACHMANN: A couple of months ago I was in the White House with President Obama. We asked him three times, ‘what’s your plan to make Medicare solvent.’ He mumbled around and didn’t give answer…he said, ‘Obamacare.’ And so what senior citizens don’t realize is that President Obama’s plan for Medicare is they will all go into Obamacare. There won’t be a Medicare going forward under President Obama.

Obviously, she didn’t understand whatever it was that he was saying about the savings under his health care plan and he clearly didn’t suggest that this would happen in term. But this isn’t the first time she’s said this —she said it in the first GOP Presidential debate. And support for it came from an unlikely source:

Ezra Klein explains that she’s right:

If Republicans can make their peace with the Affordable Care Act and help figure out how to make the Affordable Care Act’s exchanges work to control costs and improve quality, it’d be natural to eventually migrate Medicaid and Medicare into the system. Liberals would like that because it’d mean better care for Medicaid beneficiaries and less fragmentation in the health-care system. Conservatives would like it because it’d break the two largest single-payer health-care systems in America and turn their beneficiaries into consumers. But the implementation and success of the Affordable Care Act is a necessary precondition to any compromise of this sort. You can’t transform Medicaid and Medicare until you’ve proven that what you’re transforming them into is better. Only the Affordable Care Act has the potential to do that.

So Bachmann is perhaps right to say that the president is moving us towards a day when ObamaCare — or, to put it more neutrally, “premium support” — might come to Medicare. He’s seeing whether it works in the private health-care market first and, if it does, there’s little doubt that the political pressure to extend it to other groups will be intense. The question is why Bachmann and her party are doing so much to stand in his way? The corollary to Bachmann’s accusation that the president has a realistic plan to privatize Medicare is that the Republicans, for all their sound and fury over the Ryan budget, don’t.

I reacted rather badly to that when I first wrote about it. I certainly don’t recall anyone saying that the health care reform would eventually lead to Medicare being abolished. Indeed, those of us who favored Medicare for all were told repeatedly that the Rube Goldberg ACA was necessary as a first step to its expansion.

Bachman’s been saying this for a while and it’s a clever line. I wouldn’t be surprised to see the GOP adopt it more widely. Her understanding of how and why that happens is silly and confused, but according the Ezra she isn’t wrong. Indeed, it’s apparently the dream of all the policy wonks who designed the ACA. You can’t blame the Republicans for using it — it has the ring of truth.

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Begging for a tourniquet

by digby

Here’s centrist Matt Miller expressing his anger at Barack Obama for failing to live up to his expectations. Seriously.

Once Obama sees that this struggle for power assures no substantive progress in the next 15 months, he has two alternatives. He can campaign small — via Mediscare and fresh taxes on millionaires and billionaires, while demonizing the GOP candidate as “worse” — and hope to squeak across the finish line.

Or he can go big — with mega-plans for jobs, education, infrastructure, and research and development, while calling out GOP nihilism as the obstacle. But “big” means pairing this with bolder (and much more candid) long-term deficit-cutting plans that kick in once unemployment comes back down— including higher taxes on the best-off, yes, but also sensible steps to slow the growth of Medicare and Social Security, bigger defense cuts, and modestly higher taxes for everyone on consumption, dirty energy and financial transactions.

Will Obama go big? I think not, because no honest agenda for American renewal can avoid trims and taxes that impose costs on the middle class (as part of a long-term plan to save it).[Thanks for caring Matt.]

Yes, the president will sound “big,” and so will his opponent. But it’ll be phony. Instead, we’re in for another season of charades as both parties fight for 51 percent with symbolic “ideas” unequal to the size of our challenges.

Frankly, Miller’s worst case scenario sounds like heaven compared to mine which is that Obama does what all his people are saying he’s going to do and “go big” on his Grand Bargain while punting on jobs. But you have to give them credit for one thing, the White House understands what people like Miller do not — combining a massive jobs program with a massive deficit cutting program sounds like bullshit to ordinary people. Sure, it might be possible to claim that the deficit presents the greatest threat to the country the world has ever known at the same time as you increase it dramatically to put people back to work, but it doesn’t make instinctive sense to average people. Unfortunately, the Democrats jumped on the deficit bandwagon and painted themselves into this corner — once you’ve said that the government is like a family and must “tighten its belt” it’s a little hard to say that you want to go out and borrow more money. That metaphor sailed some time ago.

Had the administration and the Democrats tried to fight off deficit fever when it first struck with different policies they might have succeeded in persuading the people that the it’s the government’s job to fix the economy when the private sector fails. One wonders what would have happened if Democrats had used a different metaphor such a Krugman’s, which says that when the private sector is bleeding jobs, the government steps in with a transfusion — and that the deficit hawks in both parties are like medieval doctors applying leeches to a hemorrhaging patient. Maybe they could have shown that the function of the government is actually quite different than “daddy” worrying about how to pay the bills. But some focus group somewhere obviously “responded” to the family metaphor and so it goes.

Miller won’t get his wish. There will be no massive jobs program because the deficit hawks in both parties have made it impossible and the president has decided to try to misdirect the people and make them believe that a deficit deal is doing something. All we can do now is try to put a tourniquet on the patient and hope it somehow makes it through without developing gangrene.

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Mushy peas: austerity bites

by digby

It’s interesting that the UK is ahead of the US in its austerity folly. It gives us a glimpse of some of what we have to look forward to:

The U.K. economy will grow less this year than previously forecast, pushing the Bank of England to keep its main interest rate at a record low until the first quarter of 2012, the Confederation of British Industry said.

Gross domestic product will rise 1.3 percent in 2011, compared with an estimate of 1.7 percent in May, Britain’s biggest employers’ group said in quarterly forecasts released in London today. The CBI’s growth prediction for 2012 is unchanged at 2.2 percent.

The British economy barely grew in the second quarter and data this week may show manufacturing and services expansion slowed in July. The Bank of England will keep its key rate at 0.5 percent on Aug. 4, according to all 55 economists in a Bloomberg News survey, even after inflation was more than double its 2 percent target in June.

It turns out that long term economic downturns can cause other problems: Who knew?

Widespread antisocial and criminal behavior by young and usually unemployed people has long troubled Britain. Attacks and vandalism by gangs of young people are “a blight on the lives of millions,” said a 2010 government report commissioned in the aftermath of several deaths related to such gangs. They signal, it said, “the decline of whole towns and city areas.”

[…]

Politicians from both the right and the left, the police and most residents of the areas hit by violence nearly unanimously describe the most recent riots as criminal and anarchic, lacking even a hint of the antigovernment, anti-austerity message that has driven many of the violent protests in other European countries.

But the riots also reflect the alienation and resentment of many young people in Britain, where one million people from the ages of 16 to 24 are officially unemployed, the most since the deep recession of the mid-1980s.

Meanwhile, back in the states:

When the recession began there were many wise words about having learnt the lessons of both the Great Depression and Japan’s long malaise. Now we know we didn’t learn a thing. Our stimulus was too weak, too short and not well designed. The banks weren’t forced to return to lending. Our leaders tried papering over the economy’s weaknesses – perhaps out of fear that if we were honest about them, already fragile confidence would erode. But that was a gamble we have now lost. Now the scale of the problem is apparent, a new confidence has emerged: confidence that matters will get worse, whatever action we take. A long malaise now seems like the optimistic scenario.

Unfortunately, it’s a problem that stems from the very top ofthe political food chain:

I’m told White House political operatives are against a bold jobs plan. They believe the only jobs plan that could get through Congress would be so watered down as to have almost no impact by Election Day. They also worry the public wouldn’t understand how more government spending in the near term can be consistent with long-term deficit reduction. And they fear Republicans would use any such initiative to further bash Obama as a big spender.

So rather than fight for a bold jobs plan, the White House has apparently decided it’s politically wiser to continue fighting about the deficit. The idea is to keep the public focused on the deficit drama – to convince them their current economic woes have something to do with it, decry Washington’s paralysis over fixing it, and then claim victory over whatever outcome emerges from the process recently negotiated to fix it. They hope all this will distract the public’s attention from the President’s failure to do anything about continuing high unemployment and economic anemia.

When I first heard this I didn’t want to believe it. But then I listened to the President’s statement yesterday in the midst of yesterday’s 634-point drop in the Dow.

Krugman:

I’m still trying to make sense of this global intellectual failure. But the results are not in question: we are making a total mess of a solvable problem, with consequences that will haunt us for decades to come.

The only way you can make sense of this is that the people making decisions are feckless and weak — or it’s a daft conspiracy of dunces.

And sadly, I keep seeing liberals fall by the wayside, one by one, beginning to argue that the Grand Bargain can be supported if it contains tax increases. Well, Britain’s austerity plan had them. It didn’t exactly help the economy. And the painful cuts that will be required to solve this non-problem will be with us for a long time to come.

Ari Berman in the Nation pointed out the obvious in his post today:

The super-committee itself is a profoundly conservative and anti-Democratic entity, immune from public pressure and tasked with deciding between two bad choices—a so-called grand bargain that would significantly reduce the social safety net vs. deep across the board cuts at a time of economic peril. The idea of doing anything to stimulate the economy is totally absent from its purview. The scope of the committee itself, rather than who’s on it, is the real problem.

Indeed. And yet many good people are being drawn into the White House’s cynical strategy, probably in most cases because it doesn’t seem as if there’s anything else to do. And it’s heartbreaking.

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Meanwhile, in the real world…

by David Atkins (“thereisnospoon”)

The stock market appears to be rallying, much to the relief of the financial sector. But back in the real world:

A record 4,121 hopeful job seekers attended Del. Eleanor Holmes Norton’s 14th annual job fair at the Washington Convention Center on Tuesday.

Unintentionally, the fair came on the heels of some of the worst economic news in three years, including the Standard & Poor’s downgrade of U.S. government debt, the stock market plunge Monday and the rancorous debt-ceiling debate, not to mention the possibility that more federal jobs may be disappearing.

Attendance was up by more than 1,000 from last year’s fair, according to officials. “It’s breaking records, and it’s breaking my heart,” said Norton (D), the District’s representative in the House….

Williamson said she has been searching for an entry-level job since 2008. Like most others at the event, she had a stack of papers in one hand. In the other, she had her black high-heel shoes. She had been at the fair for a few hours, she said.

Norton said the recent action to reduce the federal deficit strictly by making spending cuts — and without raising additional revenue — has given people a “feeling of loss.”

“Our self-inflicted wound from the deficit debate played a real role,” she said.

At times like this, it’s worth remembering that the Village-approved solution to this problem is to cut even more jobs in the name of “deficit reduction.” It’s also worth remembering that the blood price Republicans demanded last year for extending unemployment benefits for people like Ms. Williamson so that they could maintain even a glimmer of hope, was the perpetuation of the Bush tax cuts for the rich. Tax cuts that continued to explode the deficit while doing little to nothing for economic growth.

I guess it takes the really smart cookies to realize that the solution to Ms. Williamson’s woes is to cut social security benefits, which will then activate the confidence fairy, who will sprinkle her magic market dust to give S&P and the bondholders the boost they need to help invest in companies, who will then suddenly use their record profits to give Ms. Williamson a job someday in a field she’d rather avoid. That Rube Goldberg machine is guaranteed to work.

Stupid people like me keep suggesting that we return to Clinton-era tax rates for the rich, and use the revenue to close the deficit while creating the sorts of jobs that will bring the middle-class economy back to life. But that’s far too simplistic to actually work. Also, too, it sounds a lot like socialism.

Fortunately, the smart people are in charge through at least November 2012. No need to worry my little head over it.

Wisconsin

Here’s an interesting essay in The Atlantic about the administration’s foreign policy that touches some familiar themes: