“The Sequester Will Help The Economy”: Another Right-Wing Fairy Tale Debunks Itself
Remember all those fearless predictions by the usual grinning idiots on the right about how the sequester was going to work miracles for the economy? Well guess what? That never happened.
I know, I know. I’m trying to recover from the shock.
The sequester took effect on March 1, so we now have three months’ worth of jobs data that have been released in its aftermath. The results have been underwhelming, to say the least. As Brad DeLong observed this week, we are still in a depressed economy. And as Ed noted yesterday, the latest monthly jobs report was thoroughly mediocre.
I particularly wanted to highlight the point the New York Times’ Annie Lowrey made: that the report shows that the sequester is already, specifically beginning to have a negative impact on employment. Yesterday’s report shows that the federal workforce, which has suffered cutbacks due to the sequester, is shrinking at a dramatically accelerated rate:
Federal employment had been on a downward trend since the start of 2011, with the government shedding about 3,000 or 4,000 positions a month through February. Then sequestration hit on March 1. And in the last three months, the federal work force has shrunk by about 45,000 positions, including 14,000 in May alone.
Those newly unemployed federal workers, of course, now have less money to spend, which will also slow down the economy. In addition, the sequester is also causing cuts in programs like unemployment benefits and benefits to low-income people such as aid for Women, Infants, and Children (WIC) and the Low Income Home Energy Assistance Program (LIHEAP). Benefits to the unemployed and low-income folks act not only as a social safety net, but also as stimulus, since poor people and the jobless are likely to spend every penny they’ve got. Now, less of that money will be going into the pockets of those people and thus into the economy at large. That will also hurt the economic recovery, such as it is.
So, for those of you keeping score at home? The right wing/free market fundamentalists/austerity caucus? They are wrong. Again. And once again, they are continuing to drive the economy, and the country, into the ground.
By: Kathleen Geier, Washington Monthly Political Animal, June 8, 2013
“This Isn’t Complicated”: Congress Must Fix The Bankrupt Student Loan Proposals
Interest rates on student loans will double on July 1 unless Congress acts. Since the phrase “congressional action” has become an oxymoron, this will quickly degenerate into an unnecessary crisis, requiring parents and students to threaten their legislators to get any relief.
Why is action even a question? There is a universal consensus — left, right and center — that it is vital to our nation to educate the next generation. If we want to compete as a high-wage, high-skill country, our children will need the best in college or advanced technical training. And all agree that gaining that higher education is a necessary, if not sufficient, requirement for entering the middle class.
So just as we pay for public education for kindergarten through 12th grade, we should ensure that advanced training or a public college education is available for all who earn it. None of this is even vaguely controversial.
Yet, despite this consensus, we are pricing college out of the reach of more and more families. State support for public universities has lagged. Increasingly, the costs have been privatized, with the bill sent to students and families.
With incomes stagnant for all but the wealthy few, the result, not surprisingly, has been an explosion of student debt. U.S. students and parents now owe an estimated $1.1 trillion in student loan debt, a sum greater than credit card or automobile debt. In 2005, average student loan debt was just over $17,000. By 2012, it was above $27,250, increasing more than 50 percent in just seven years.
With the debt burden rising and good jobs scarce, the result is calamity. Thirty-five percent of millennials — debtors under 30 — are seriously delinquent on their payments. In total, delinquent student debtors on the verge of default owe $113 billion, more than the total sums state governments spent on higher education in 2012.
The young people who do everything we ask of them — study, graduate, go on to higher education — end up deep in a hole. Burdened by debt, they have a hard time affording cars or apartments. Starting a family becomes difficult, a down payment on a home an impossible dream. This not only crushes the dreams of our best young people; it puts a real damper on the economy.
This isn’t complicated. Washington should be moving boldly to make advanced education affordable for all. The federal government should be increasing grants to states for public colleges, on the condition that the states increase their own contributions and act to curb college costs. The government should crack down on private colleges that ripoff students. And of course, college expenses should be subsidized so that successful young people don’t graduate into debtor’s prison.
But common sense is an endangered species inside Washington’s beltway. Interest rates on federally subsidized Stafford loans are about to double to 6.8 percent. Republicans have passed a “solution” that pegs loan rates to the rate of a 10-year Treasury note plus an arbitrary 2.5 percent. (Or plus 4.5 percent for parental PLUS loans). Loans fluctuate each year with interest rates, with a cap of 8.5 percent for student loans and a stunning 10.5 percent for parental loans. Kids will end up paying more, while the government will make billions on the deal for deficit reduction. But we should be subsidizing the next generation to get the education they need, not making money off of them.
President Obama’s plan isn’t much better. He sets the rate at the 10-year Treasury note rate plus .93 percent for subsidized Stafford loans (3.93 percent for parental loans) with no cap. He does call for limiting what students have to pay to 10 percent of their income, insuring that students aren’t condemned to bankruptcy. His plan is “budget neutral.”
Sen. Elizabeth Warren (D-Mass.) has offered a plan that makes a lot of sense. She suggests we offer students the same rate that the Federal Reserve charges to big banks (about .75 percent) for the next year, while Congress gets serious about a permanent fix. Senators Tom Harkin (D-Iowa) and Jack Reed (D-R.I.) suggest that the Congress do the easy thing, simply extend the current rates for two years, paying for it with the closing of various loopholes.
Sen. Kirsten Gillibrand (D-N.Y.), like Warren, also makes sense. She would allow students and graduates to refinance into fixed 4 percent loans.
Is it any wonder that Americans grow cynical? Multinational corporations and wealthy investors stash literally trillions abroad to avoid taxes. The big banks rake in trillions in subsidies and discounted loan rates to rescue them from their own excesses. But Congress finds it impossible to make it affordable for the next generation to get advanced education and training.
As always, common sense won’t come to Washington unless citizens mobilize to force it on Congress. With graduations marked by student demonstrations across the country and pickets outside of Sallie Mae, the giant student loan bank, that movement may have begun. Student loans may be to this generation what the draft was to the boomers – the government folly that afflicts them personally and rouses them to act.
By: Katrina vanden Heuvel, Opinion Writer, The Washington Post, June 5, 2013
“Non-Factual Facts”: Washington Post Hedges Claim That Google, Facebook, Gave The Government Direct Access To Their Servers
Yesterday, the Washington Post reported a shocking story about how the FBI and National Security Agency had partnered with Google, Facebook, and many other tech companies to spy on the tech companies’ hundreds of millions of users.
The government agencies, the Post said, were “tapping directly into the central servers of nine leading U.S. Internet companies, extracting audio, video, photographs, e-mails, documents and connection logs that enable analysts to track a person’s movements and contacts over time.”
This surveillance program, the Post reported, had been “knowingly” facilitated by the tech companies, which had allowed the government to tap directly into their central servers.
The Post story described a “career intelligence officer” as being so horrified by the power and privacy intrusion of this surveillance system that the officer was helping to leak the news to expose it.
“They quite literally can watch your ideas form as you type,” the officer reportedly told the Post.
Not surprisingly, the Post’s story created an instant explosion of outrage. The ire was directed at both the government and the technology companies.
The story also led to immediate, explicit denials from the technology companies. Google, Facebook, and Yahoo all said that the government did not have “direct access” to any servers. Apple said it had never even heard of the program it was supposedly partnering with.
So The Post’s claim that the companies had voluntarily given the government direct, open, un-monitored access to their servers quickly seemed suspect.
And now, 24 hours later, after more denials and questions, the Post has made at least two important changes to its spying story.
First, the Post has eliminated the assertion that the technology companies “knowingly” participated in the government spying program.
Second, and more importantly, the Post has hedged its assertion that the companies have granted the government direct access to their servers.
The latter change is subtle, but important. In the first version of its story, the Post stated as a fact that the government had been given direct access to the companies’ servers.
Now, the Post attributes the claim to a government presentation–a document that has been subjected to significant scrutiny and skepticism over the past day and that, in this respect, at least, seems inaccurate.
In other words, the Post appears to have essentially retracted the most startling and important part of its story: That the country’s largest technology companies have voluntarily given the government direct access to their central servers so the government can spy on the tech companies’ users in real time.
Specifically, here’s how the Washington Post story has changed…
Here’s the original first paragraph:
The National Security Agency and the FBI are tapping directly into the central servers of nine leading U.S. Internet companies, extracting audio, video, photographs, e-mails, documents and connection logs that enable analysts to track a person’s movements and contacts over time.
Here’s the updated paragraph (our emphasis):
The National Security Agency and the FBI are tapping directly into the central servers of nine leading U.S. Internet companies, extracting audio and video chats, photographs, e-mails, documents, and connection logs that enable analysts to track foreign targets, according to a top-secret document obtained by The Washington Post.
That change is important. The direct-access claim changes from a fact asserted by the Washington Post to a claim made in a document the Washington Post has seen–a document that might be wrong.
The idea that Google, Facebook, Apple, et al, had voluntarily given the government direct unfettered access to their servers always seemed far-fetched.
This behavior would justifiably trigger the wrath of the companies’ hundreds of millions of users worldwide and exacerbate already existing concerns that these companies routinely trample all over their users’ privacy.
Furthermore, the government’s assertions that its spying programs are directed primarily at foreigners, not US citizens, would not be viewed as comforting to Google, Facebook, et al.
Why not?
Because the vast majority of the users of these companies’ services are foreigners.
If the international users of Facebook, Google, et al, were to feel that the companies were opening their data centers in this way, the international users might revolt. So it’s hard to imagine that these companies would just voluntarily open their servers to the U.S. government (or, for that matter, any other government).
The Washington Post also broke the news about the existence of the vast government program Internet spying called PRISM, which other outlets have since confirmed. And the story illustrated how extensively the government uses Internet communications in its intelligence efforts and how important these communications are to national security.
But, a day after the Post story appeared, it seems likely that the following claims are wrong or at least need major qualification:
- that the NSA and FBI are “tapping directly into the central servers” of Facebook, Google, et al, and,
- that the government can “quite literally watch your ideas form as you type.”
By: Henry Blodget, Business Insider, June 7, 2013
“The Sorry Spectacle Continues”: Polarized Washington Ignores Long-Term Issues At Its Peril
Scandalfest continues. Official Washington is still flitting from one minor controversy to another, with the news media breathlessly reporting the latest leaked email or unsubstantiated accusation. Clearly, the chattering classes have declared the jobs crisis ended and the economic recovery complete.
While the Obama administration hasn’t popped open champagne bottles to celebrate, the air of silliness that hangs over the Beltway is a reminder that the worst is over. After all, the stock market is soaring. Consumer confidence is climbing.
The latest national unemployment number is down to 7.5 percent, the lowest level since December 2007, when the economy started its steep descent. Indeed, the sustained economic uptick may have a direct tie-in to Washington’s current obsession with less consequential matters: The economy is strong enough to have persuaded Republicans to stop blasting President Barack Obama over joblessness, so they’ve had to find other issues with which to batter him.
Here’s an update from outside the Beltway Bubble: The jobs crisis is not over. Average Americans are still struggling through an ugly economic transformation — a structural change decades in the making that jumped into overdrive with the Great Recession. Millions of Americans of working age remain unemployed, while others patch together two or three part-time jobs to keep food on the table. Still others have found full-time jobs but at far less pay than they used to earn.
A recent Quinnipiac poll provides a clear look into the minds of voters, who have little interest in the imbroglios of the moment. Rightly, 44 percent believe the revelations about the Internal Revenue Service, which singled out conservative organizations for unfair screening, as most important among the current controversies. Only 24 percent cited the deaths of four Americans at a diplomatic outpost in Benghazi, despite the GOP’s obsession with it. Far fewer, just 14 percent, listed the Justice Department’s scrutiny of reporters.
But here’s the news you may have missed: An overwhelming 73 percent said that boosting the economy and creating jobs is more important than any of the other three issues. If politicians were as poll-obsessed as they are rumored to be, they’d at least pretend to be devoting most of their time to helping middle-class Americans get back into stable jobs with good pay.
The jobs crisis has been decades in the making, an economic restructuring fueled by globalization and technology. Think about it: Those Bangladeshi textile workers killed in an April building collapse were doing work once done in the United States. No matter how many affluent Americans protest the conditions and boycott the designers who contributed to the disaster, those jobs are not coming back to these shores. Manufacturers will continue to pursue cheap labor.
As a result, the jobs that once guaranteed good wages and stable futures to generations of Americans without college degrees have all but disappeared. That transformation, which started in the 1970s, has contributed to the wage gap, the ever-widening rift between the haves and have-nots. The average American worker has been losing economic ground for decades.
Politicians ignore that growing gap at their peril. The notion of an America where everybody has an equal shot has always been more myth than reality, but there was once a time when it was not so difficult for young adults to imagine a more prosperous future than their parents had. That is no longer a likely scenario.
That’s a very difficult problem to solve, which helps explain why politicians don’t like to discuss it. It calls for a multigenerational response, the sort of bipartisan approach that is usually reserved for battles against foreign enemies.
But Washington is stuck in a period of deepening polarization, incapable, it seems, of even agreeing on the causes of our economic woes. Democrats, at least, have a language for discussing widening income inequality. Republicans haven’t yet come to terms with its existence. So the sorry spectacle continues.
By: Cynthia Tucker, The National Memo, June 6, 2013
“Worried About The Right Wing”: Marco Rubio Threatens To Betray His Allies On Immigration Reform
As we discussed in April, Sen. Marco Rubio (R-Fla.) spent a few months playing an awkward game on comprehensive immigration reform. On the one hand, Rubio has been a high-profile member of the “Gang of Eight,” helping negotiate the details of the legislation. On the other hand, the Florida Republican signaled his willingness to oppose the legislation he’s ostensibly helping write. Rubio would say he likes his own bill, but wouldn’t commit to it.
Many of those involved in the process grew weary of Rubio straddling the fence. It was common to hear Capitol Hill insiders joke that the senator thought he could be “a little bit pregnant” on the policy.
But all that changed in mid-April, when Rubio got off the fence and began championing the legislation he helped craft. And all of that changed again late yesterday when Rubio said he’s prepared to reject his own legislation.
Speaking with radio host Hugh Hewitt Tuesday, Rubio said the Senate should “strengthen the border security parts of this bill so that they’re stronger, so that they don’t give overwhelming discretion to the Department of Homeland Security.” He said he was working with other senators on amendments to do just that.
Then Hewitt asked: “If those amendments don’t pass, will you yourself support the bill that emerged from Judiciary, Senator Rubio?”
Rubio answered, “Well, I think if those amendments don’t pass, then I think we’ve got a bill that isn’t going to become law, and I think we’re wasting our time. So the answer is no.”
Even for Rubio, this is bizarre. The Florida Republican had concerns about provisions related to border security, which he worked out through the “Gang of Eight” negotiations — his colleagues made the changes he wanted to see, which in turn led Rubio to endorse the bipartisan legislation.
But now the senator is moving the goalposts, saying the changes that have already been made aren’t good enough, and unless he’s able to move his bill even further to the right, Rubio is prepared to reject his own legislation.
Well, maybe Democrats can once again give Rubio what he wants, keeping the larger effort intact?
I’m afraid not — Rubio is asking far too much.
Senate Minority Whip John Cornyn intends to introduce a sweeping amendment to the immigration bill when it goes on the floor next week, seeking to replace an entire section devoted to border security and tweak the national security and criminal justice titles.
Sen. Marco Rubio (R-Fla.), one of the members of the Senate’s bipartisan Gang of Eight, has been working with Cornyn on the amendment “for weeks,” a Rubio aide said.
The Texas Republican wants stricter border patrol provisional “triggers” before registered immigrants are allowed to apply for green card status. His amendment would require 100 percent operational control of the Southern borders and that 90 percent of illegal border crossers be apprehended. It would also require 100 percent border surveillance, or situational awareness, of each one-mile segment of the Southern border and installment of a national E-Verify system before registered immigrants can pursue green cards.
No serious person involved in the negotiations believes this is a responsible approach. Indeed, no one even thinks these standards are realistic — it’s exactly why the Gang of Eight considered and rejected these measures during their negotiations. Rubio said they weren’t necessary to earn his support for the legislation, and now he’s saying they are.
He is, in other words, apparently prepared to betray his allies.
And why would Rubio do this? Because the Republican Party’s radicalized base opposes comprehensive reform, and Rubio’s support for the bill will undermine his future career ambitions, including a likely run for national office in 2016. [Update: Adam Serwer notes this is ultimately pointless, since the right will still resent the fact that he helped write a bill they hate, and the left will resent the fact that he walked away from a deal reached in good faith.]
There is an important caveat to all of this: Rubio has waffled before. I don’t recall him going as far as he did with Hugh Hewitt, but the Florida Republican occasionally waffles, only to be brought back into the fold. Reform proponents can hope that McCain and Graham will give him a call this morning, Rubio will walk back his comments from yesterday, and the process will move forward. Rubio isn’t a policy guy, so it’s possible he got rattled yesterday and said what he didn’t entirely mean.
But if we take his words at face value, Rubio has put the future of immigration reform at great risk, basically because he’s worried right-wing activists won’t like him anymore.
By: Steve Benen, The Maddow Blog, June 5, 2013
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