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Recovering The Constitution From Conservatives

Tea Party types and other conservatives talk about how they’d like their country back.

I’d like my Constitution back.

The rise of these self-proclaimed constitutional conservatives is an ominous development that has received too little notice — and too little push-back.

Until now. Under the banner of “Constitutional Progressives,” a coalition of liberal groups has begun making an important, two-part argument: first, that a progressive government agenda is consistent with constitutional values; and second, that the constitutional conservative approach represents a dangerous retrenchment of the government’s role.

This bid to “rebut the constitutional fairy tales being peddled by the Tea Party,” as Douglas Kendall of the Constitutional Accountability Center put it, could not be more timely, with the dizzying rise of Texas Gov. Rick Perry (R).

The constitutional conservative critique, as articulated by Perry, Rep. Michele Bachmann (R-Minn.) and others, goes far beyond the familiar laments about activist judges. It is, at bottom, an argument against the 20th century — specifically against the notion that the Constitution envisions and empowers a muscular federal government able to ensure that its citizens have clean air, healthy food and safe workplaces.

To grasp the radical nature of the constitutional conservative approach, consider the record of every Republican president since the New Deal.

Richard Nixon ran on the pledge of appointing “strict constructionist” judges, but he created the Environmental Protection Agency, telling Congress that “our national government today is not structured to make a coordinated attack on the pollutants which debase the air we breathe, the water we drink and the land that grows our food.” Nixon didn’t doubt — as do the modern constitutional conservatives — that environmental regulation was an appropriate and constitutional role for the federal government.

Likewise, George W. Bush inveighed against judges “legislating from the bench.” Yet he presided over the largest expansion of Medicare — the addition of a prescription drug benefit — in the history of the program and oversaw a sweeping new role for the federal government in assuring quality education by local schools. Bush didn’t question — as do the constitutional conservatives — whether these were permissible activities for the federal government.

The constitutional conservative vision is dramatically different. It sees a hobbled federal government limited to a few basic activities, such as national defense and immigration. The 10th Amendment, reserving to states the powers not granted to the federal government, would be put on steroids. The commerce clause, giving the federal government the authority to regulate commerce among the states, would be drastically diminished.

Certainly, there’s a legitimate debate about the proper role of the federal government and the scope of federal vs. state power. But that is a different argument than the one long thought settled during the New Deal: that the Constitution grants the federal government power to regulate a broad array of activities in the national interest.

The danger posed by the constitutional conservative approach is to attempt to lash together debates about what the federal government should do and what the Constitution allows it to do.

A white paper by the liberal Center for American Progress spells out the potential consequences of the constitutional conservative vision. Programs such as Social Security, Medicare and Medicaid would be deemed to exceed the federal government’s enumerated powers.

The federal government would cease to have any role in education, eliminating funding for public schools and college financial aid, and in combating poverty, ending food stamps and unemployment insurance. Laws on everything from child labor to food safety would be overturned.

None of this is likely to happen, of course, for the simple reason that most Americans don’t want it to. When Perry was pushed during a debate about the implications of his views on the constitutionality of Social Security, for example, he waved off the question as an interesting intellectual exercise.

But the emergence of the constitutional conservative argument has real-world consequences — even without a constitutional conservative in the White House. It shifts the legal debate significantly rightward, energizing and empowering conservative judges and justices. And it changes the nature of the political debate as well by narrowing the turf on which, at least in the view of some lawmakers, the federal government is deemed authorized to operate.

“This is a way to weaponize the Constitution to prevent a real debate about how the government can solve national problems,” Kendall told me.

Strong words, but the constitutional conservative vision is too extreme to continue to ignore it in the hope that it will fade on its own.

By Ruth Marcus, Opinion Writer, The Washington Post, September 18, 2011

September 19, 2011 Posted by | Class Warfare, Commerce Clause, Congress, Conservatives, Constitution, Democracy, Democrats, Economy, Education, Elections, GOP, Government, Ideologues, Ideology, Lawmakers, Medicaid, Medicare, Middle Class, Politics, Public, Regulations, Republicans, Right Wing, Social Security, States, Teaparty | , , , , , , , , , | 2 Comments

What If the Tea Party Wins? They Have A Plan For The Constitution, And It Isn’t Pretty

In the Tea Party’s America, families must mortgage their home to pay for their mother’s end-of-life care. Higher education is a luxury reserved almost exclusively to the very rich. Rotten meat ships to supermarkets nationwide without a national agency to inspect it. Fathers compete with their adolescent children for sub-minimum wage jobs. And our national leaders are utterly powerless to do a thing.

At least, that’s what would happen if the Tea Party succeeds in its effort to reimagine the Constitution as an antigovernment manifesto. While the House of Representatives pushes Rep. Paul Ryan’s (R-WI) plan to phase out Medicare, numerous members of Congress, a least one Supreme Court justice, and the governor of America’s second-largest state now proudly declare that most of the progress of the last century violates the Constitution.

It is difficult to count how many essential laws would simply cease to exist if the Tea Party won its battle to reshape our founding document, but a short list includes:

  • Social Security and Medicare
  • Medicaid, children’s health insurance, and other health care programs
  • All federal education programs
  • All federal antipoverty programs
  • Federal disaster relief
  • Federal food safety inspections and other food safety programs
  • Child labor laws, the minimum wage, overtime, and other labor protections
  • Federal civil rights laws

Indeed, as this paper explains, many state lawmakers even embrace a discredited constitutional doctrine that threatens the union itself.

What’s at stake

The Tea Party imagines a constitution focused entirely upon the Tenth Amendment, which provides that “The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people”—which is why their narrow vision of the nation’s power is often referred to as “tentherism.” In layman’s terms, the Tenth Amendment is simply a reminder that the Constitution contains an itemized list of federal powers—such as the power to regulate interstate commerce or establish post offices or make war on foreign nations—and anything not contained in that list is beyond Congress’s authority.

The Tea Party, however, believes these powers must be read too narrowly to permit much of the progress of the last century. This issue brief examines just some of the essential programs that leading Tea Partiers would declare unconstitutional.

Social Security and Medicare

The Constitution gives Congress the power “to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States,” thus empowering the federal government to levy taxes and leverage these revenues for programs such as Social Security and Medicare. A disturbingly large number of elected officials, however, insist that these words don’t actually mean what they say.

In a speech to the conservative American Legislative Exchange Council, Texas Gov. Rick Perry listed a broad swath of programs that “contradict the principles of limited, constitutional government that our founders established to protect us.” Gov. Perry’s list includes Medicare and “a bankrupt social security system, that Americans understand is essentially a Ponzi scheme on a scale that makes Bernie Madoff look like an amateur.” And Perry is hardly the only high-ranking elected official to share this view.

Sen. Mike Lee (R-UT) mocked President Franklin Delano Roosevelt for calling upon the federal government to provide “a decent retirement plan” and “health care” because “the Constitution doesn’t give Congress any of those powers.” Rep. Bob Goodlatte (R-VA), who engineered the House of Representatives’s dramatic reading of the Constitution earlier this year, claimed that Medicare and Social Security are “not in the Constitution” and are only allowed to exist because “the courts have stretched the Constitution to say it’s in the general welfare clause.” Sen. Tom Coburn (R-OK) said we should eliminate Medicare because “that’s a family responsibility, not a government responsibility.”

Because this erroneous view of our founding document is rooted in an exaggerated view of the Tenth Amendment’s states rights’ provision, many so-called tenthers claim that eliminating Social Security and Medicare wouldn’t necessarily mean kicking millions of seniors out into the cold because state governments could enact their own retirement programs to pick up the slack. This proposal, however, ignores basic economics.

Under our current system, someone who begins their career in Ohio, moves to Virginia to accept a better job offer, and then retires in Florida pays the same federal taxes regardless of their residence. These taxes then fund programs such as Medicare and Social Security. If each state were responsible for setting up its own retirement system, however, the person described above would pay Ohio taxes while they worked in Ohio, Virginia taxes while they lived in Virginia, and would draw benefits from the state of Florida during their retirement. The state which benefited from their taxes would not be the same state that was required to fund their retirement, and the result would be an economic death spiral for states such as Florida that attract an unusually large number of retirees.

For this reason, tenther proposals to simply let the states take over Social Security and Medicare are nothing more than a backdoor way to eliminate these programs altogether. If the Tea Party gets its way, and our nation’s social safety net for seniors is declared unconstitutional, millions of seniors will lose their only income and their only means to pay for health care.

Medicaid, the State Children’s Health Insurance Program, and other health care programs

The Tea Party’s constitution has plenty of bad news for Americans below the retirement age as well. Rep. Virginia Foxx (R-NC), for example, recently claimed that any federal involvement in health care whatsoever is unconstitutional because “the words ‘health care’ are nowhere in the Constitution.”

Sen. Coburn lumped Medicaid in with Medicare when he claimed that providing for the frailest Americans is a “family responsibility,” and Gov. Perry includes Medicaid on his list of programs that “contradict[] the principles of limited, constitutional government.” Sen. Mike Lee’s (R-UT) claim that “the Constitution doesn’t give Congress” any authority over health care is a blanket statement encompassing all federal health programs.

If this vision were to be implemented, all federal health care programs would simply cease to exist and millions of Americans would lose their only access to health insurance.

Education

Education is also on the Tea Party’s chopping block. Rep. Scott Garrett (R-NJ) routinely grills education secretaries at congressional hearings, insisting that the Constitution does not authorize any federal involvement in education. Similarly, Rep. Foxx insists that “we should not be funding education” because she insists doing so violates the Tenth Amendment. And Sen. Coburn does not “even think [education] is a role for the federal government.”

In its strongest form, this position wouldn’t just eliminate federal assistance for state-run public schools. It would also eliminate programs enabling Americans to pay for their college education. Millions of students would lose their Pell Grants and federal student loans if the Tea Party’s full vision of the Constitution were implemented.

Some tenthers, however, offer a slightly less drastic position. It is commonplace for the federal government to grant money to the states if those states agree to comply with certain conditions. Federal law, for example, provides generous public education grants provided that states gather data on student achievement and comply with other such conditions. Many Tea Partiers argue that these conditions violate the Constitution. Thus, Rep. Blake Farenthold (R-TX), claims that the Constitution only permits the federal government to provide states with “block grants.”

The truth, however, is that the federal government has never told states how to educate their children—and it could not do so if it tried. Under a Supreme Court decision called Printz v. United States, federal laws ordering a state to take a specific action actually do violate the Tenth Amendment. So, the state of Texas is perfectly free to turn down federal grants if they do not like the conditions attached to them.

Moreover, it is not clear how federal grants of any kind can exist if Congress is not allowed to attach conditions to them. If Congress cannot constitutionally require states to spend grant money on standardized testing, for example, how can they require that it be spent on education and not on building a new wing for the governor’s mansion? Thus, even the slightly more moderate position advocated by people like Rep. Farenthold would likely eliminate the federal government’s ability to provide educational assistance to low-income students or otherwise help fund public schools.

Antipoverty programs, federal disaster relief, and other help for the less fortunate

Sen. Lee would go even further in cutting off assistance for low-income Americans. In an interview with a Utah radio host, Lee claimed that the framers intended all antipoverty programs to be dealt with exclusively at the state level. This would not only eliminate programs like income assistance and food stamps, it could threaten unemployment insurance, federal job training, and other programs intended to provide a bridge out of poverty.

In the same interview, Sen. Lee claimed that federal relief for hurricane, earthquake, tornado, and other disaster victims is “one of many areas where we ought to focus on getting that power back to the states,” a position that would kill the Federal Emergency Management Agency and prevent the nation as a whole from rallying to the support of a state whose financial resources are overwhelmed by a major natural disaster.

Food safety

Sen. Lee also claims that “the framers intended state lawmakers deal with” food safety in this same radio interview. This position would not simply endanger the residents of states with inadequate regulation of their food supply, it would also create costly and duplicative state inspection programs and impose logistical nightmares on food-importing states.

If a cow is raised in Texas, slaughtered in Oklahoma, and then sold as steaks in New York, which state is responsible for inspecting the meat? The likely answer is that all three states would have their own system of laws, tripling the regulatory compliance costs for the meat producer.

Moreover, if New York decides that Oklahoma’s inspections’ regime is inadequate, its only recourse would be to require meat producers to submit their products to a customs check at the border before it could be sold in that state. The result would be higher taxes for New Yorkers forced to pay for these customs stations, and higher costs for businesses forced to submit to inspections every time they brought food across a state border.

Child labor laws, the minimum wage, overtime, and other labor protections

Nearly 100 years ago, the Supreme Court declared federal child labor laws unconstitutional in a case called Hammer v. Dagenhart. Twenty-two years later, the Court recognized that Hammer’s holding was “novel when made and unsupported by any provision of the Constitution,” and unanimously overruled this erroneous decision.

Sen. Lee, however, believes that, while Hammer might “sound harsh,” the Constitution “was designed to be that way. It was designed to be a little bit harsh,” and thus we should return to the world where federal child labor laws are unconstitutional. Moreover, Lee has a very powerful ally prepared to sweep away nearly all national protections for American workers.

Under existing Supreme Court doctrine, Congress’s authority to “regulate commerce … among the several states” includes the power to regulate the roads and railways used to transport goods in interstate commerce, as well as the goods themselves and the vehicles that transport them. Additionally, Congress may regulate activities that “substantially affect interstate commerce.” This “substantial effects” power is the basis of Congress’s authority to make labor laws universal throughout all places of employment.

Yet Justice Clarence Thomas claimed in three separate cases—U.S. v. Lopez, U.S. v. Morrison, and Gonzales v. Raich—that this “substantial effects” test is “at odds with the constitutional design.” It is possible that Thomas’s vision would still allow some limited federal labor regulation—such as a law prohibiting children from becoming railway workers—but anything resembling the essential web of federal laws that protect American workers today would be impossible.

Civil rights laws

Shortly after he won his party’s nod to be a U.S. Senate candidate, Sen. Rand Paul (R-KY) revealed that he opposes the federal bans on whites-only lunch counters and race discrimination in employment. In a rambling interview with MSNBC’s Rachel Maddow, Paul explained that, while he believes that Congress may ban discrimination from “public institutions,” he does not support antidiscrimination laws that regulate private business.

As Sen. Paul suggested in that interview, these basic civil rights laws—like national laws banning child labor and establishing a minimum wage—can be snuffed out of existence if Congress’s power to enact commercial regulations is read too narrowly.

In 1964, the Supreme Court unanimously upheld the federal ban on whites-only lunch counters—once again relying on the “substantial effects” test to do so. For this reason, it is likely the Justice Thomas would strike down this and other federal laws protecting civil rights.

The union

Gov. Perry suffered well-deserved ridicule when he suggested in 2009 that Texas may secede from the union if “Washington continues to thumb their nose at the American people.” But Gov. Perry’s ill-considered remark is merely a distraction compared to a much larger movement to effectively secede from the union one law at a time.

Gov. Perry joins lawmakers from New Hampshire, Montana, Virginia, Idaho, Florida, and many other states in backing unconstitutional state laws purporting to “nullify” a federal law. Many state legislatures have passed, and a few governors have signed, laws claiming to nullify part of the Affordable Care Act, and Perry signed a law that partially nullifies federal light bulb standards.

Nullification is an unconstitutional doctrine claiming that states can prevent a federal law from operating within their borders. Although nullification conflicts directly with the text of the Constitution, which provides that Acts of Congress “shall be the supreme law of the land…anything in the Constitution or laws of any State to the contrary notwithstanding,” it has experienced a significant revival among state lawmakers eager to second-guess national leaders’ decisions.

This doctrine is not simply unconstitutional, it is a direct attack on the idea that we are the United States of America. As James Madison wrote in 1830, allowing states to simply ignore the laws they don’t want to follow would “speedily put an end to the Union itself.”

Conclusion

America has long endured the occasional politician eager to repeal the entire 20th Century, but, as President Dwight Eisenhower observed nearly 60 years ago, “Their numbers [were] negligible and they are stupid.” Sadly, this is no longer the case. Tenthers increasingly dominate conservative politics and their numbers are growing.

If this movement succeeds in replacing our founding document with their entirely fabricated constitution, virtually every American will suffer the consequences. Seniors will lose their Social Security and Medicare. Millions of students could lose their ability to pay for college. And workers throughout the country will lose their right to organize, to earn a minimum wage, and to be free from discrimination.

Worse, because the Tea Party believes their policy preferences are mandated by the Constitution, they would do far more than simply repeal nearly a century of essential laws. Once something is declared unconstitutional, it is beyond the reach of elected officials— and beyond the voters’ ability to revive simply by tossing unwise lawmakers out of office.

For this reason, the Tea Party’s agenda is not simply one of the most radical in generations, it is also the most authoritarian. They do not simply want to eliminate decades of progress; they want to steal away “We The People’s” ability to bring it back.

 

By: Ian Millhiser, Center for American Progress, September 16, 2011

September 16, 2011 Posted by | Affordable Care Act, Class Warfare, Collective Bargaining, Commerce Clause, Congress, Conservatives, Constitution, Democracy, Democrats, Economy, Education, Elections, Equal Rights, GOP, Government, Health Care, Ideologues, Ideology, Income Gap, Jobs, Labor, Lawmakers, Medicaid, Medicare, Middle Class, Minimum Wage, Politics, Public, Regulations, Republicans, Right Wing, SCOTUS, Social Security, State Legislatures, States, Tea Party, Unions, Voters | , , , , , , , , | Leave a comment

Wall Street’s Worst Nightmare: Elizabeth Warren To Run For Senate

Elizabeth Warren, consumer advocate and chief architect of the Consumer Financial Protection Bureau, will announce on Wednesday that she will run for the U.S. Senate seat in Massachusetts currently held by Republican Scott Brown.

Should Warren prevail in defeating the six candidates who have already announced their intention to compete in the Democratic primary, the result may be the greatest economic boon to Massachusetts media outlets since the days of Kennedy money as Wall Street ponies up serious bucks in an effort to defeat their arch-nemeses. Democratic contributors can be expected to respond in kind as bringing the Massachusetts senate seat back into the Democratic column is considered an important key to retaining the Democratic majority in the Senate.

While Warren is not expected to make a formal, public announcement, the Boston Globe reports that a video will go up on Warren’s website tomorrow announcing her intentions and saying, in part—
The pressure on middle class families are worse than ever, but it is the big corporations that get their way in Washington. I want to change that. I will work my heart out to earn the trust of the people of Massachusetts.

If track record counts for anything, you can believe that Elizabeth Warren will do precisely as she says. Because of that track record, the Harvard Law professor, who went to Washington and built a major following by relentlessly attacking the financial institutions for their anti-consumer agenda, will surely have the support of national progressives and Democrats, support she has unquestionably earned.

The possibility of Warren’s election presents GOP senators with a rich dose of irony. Warren was the obvious and most deserving person to serve as the first leader of the CFPB, the consumer protection agency she almost single-handedly created. However, in an effort to protect their Wall Street cronies and financial backers, the Republicans in the Senate made it very clear that her nomination would never be approved.

As the administrator of the CFPB, Warren would have been under the thumb of Congress. As a member of the Senate, it will be a very different story.
Payback can be rough.

 

By: Rick Ungar, Mother Jones, September 13, 2011

September 14, 2011 Posted by | Class Warfare, Congress, Conservatives, Consumer Financial Protection Bureau, Consumers, Corporations, Democrats, Financial Institutions, GOP, Government, Media, Middle Class, Politics, Public, Regulations, Republicans, Right Wing | , , , , | Leave a comment

The GOP Magical World Of Voodoo ‘Economists’: Repeal The 20th Century

If you came up with a bumper sticker that pulls together the platform of this year’s crop of Republican presidential candidates, it would have to be:

Repeal the 20th century. Vote GOP.

It’s not just the 21st century they want to turn the clock back on — health-care reform, global warming and the financial regulations passed in the wake of the recent financial crises and accounting scandals.

These folks are actually talking about repealing the Clean Air Act, the Clean Water Act and the Environmental Protection Agency, created in 1970s.

They’re talking about abolishing Medicare and Medicaid, which passed in the 1960s, and Social Security, created in the 1930s.

They reject as thoroughly discredited all of Keynesian economics, including the efficacy of fiscal stimulus, preferring the budget-balancing economic policies that turned the 1929 stock market crash into the Great Depression.

They also reject the efficacy of monetary stimulus to fight recession, and give the strong impression they wouldn’t mind abolishing the Federal Reserve and putting the country back on the gold standard.

They refuse to embrace Darwin’s theory of evolution, which has been widely accepted since the Scopes Trial of the 1920s.

One of them is even talking about repealing the 16th and 17th amendments to the Constitution, allowing for a federal income tax and the direct election of senators — landmarks of the Progressive Era.

What’s next — repeal of quantum physics?

Not every candidate embraces every one of these kooky ideas. But what’s striking is that when Rick Perry stands up and declares that “Keynesian policy and Keynesian theory is now done,” not one candidate is willing to speak up for the most important economic thinker of the 20th century. Or when Michele Bachmann declares that natural selection is just a theory, none of the other candidates is willing to risk the wrath of the religious right and call her on it. Leadership, it ain’t.

I realize economics isn’t a science the way biology and physics are sciences, but it’s close enough to one that there are ideas, principles and insights from experience that economists generally agree upon. Listening to the Republicans talk about the economy and economic policy, however, is like entering into an alternative reality.

Theirs is a magical world in which the gulf oil spill and the Japanese nuclear disaster never happened and there was never a problem with smog, polluted rivers or contaminated hamburger. It is a world where Enron and Worldcom did not collapse and shoddy underwriting by bankers did not bring the financial system to the brink of a meltdown. It is a world where the unemployed can always find a job if they really want one and businesses never, ever ship jobs overseas.

As politicians who are always quick to point out that it is only the private sector that creates economic growth, I found it rather comical to watch the governors at last week’s debate duke it out over who “created” the most jobs while in office. I know it must have just been an oversight, but I couldn’t help noticing that neither Mitt Romney nor Perry thought to exclude the thousands of government jobs included in their calculations — the kinds of jobs they and their fellow Republicans now view as economically illegitimate.

And how wonderfully precise they can be when it comes to job numbers. Romney is way out front when it comes to this kind of false precision. His new economic plan calculates that President Obama would “threaten” 7.3 million jobs with the ozone regulation that, in fact, the president had just canceled. By contrast, Romney claims his own plan will create 11 million jobs in his first term — not 10, not 12, but 11 million.

When you dig into such calculations, however, it turns out many are based on back-of-the-envelope extrapolations from industry data that totally ignore the dynamic quality of economic interactions.

One recent example comes from the cement industry, which now warns that new regulations limiting emissions of sulfur dioxide and nitrogen oxide could close as many as 18 of the 100 cement plants in the United States, resulting in the direct loss of 13,000 jobs.

Then again, where do you think all those customers of the 18 plants will get their cement? Do you think they might get some of it from the other 82 plants, which in turn might have to add a few workers to handle the additional volume? Or that a higher price for cement might induce somebody to build a modern plant to take advantage of the suddenly unmet demand? Or perhaps that higher prices for cement will lead some customers to use another building material produced by an industry that will have to add workers to increase its output? And what about the possibility that the regulation will encourage some innovative company to devise emissions-control equipment that will not only allow some of those plants to remain open but generate a few thousand extra jobs of its own as it exports to plants around the world.

Such possibilities are rarely, if ever, acknowledged in these “job-scare studies.” Also left out are any estimates of the benefits that might accrue in terms of longer, healthier lives. In the Republican alternative universe, it’s all costs, no benefits when it comes to government regulation. As they see it, government regulators wake up every morning with an uncontrollable urge to see how many jobs they can destroy.

If consistency is the hobgoblin of small minds, then these Republican presidential candidates are big thinkers, particularly on fiscal issues.

In the Republican alternative universe, allowing an income tax cut for rich people to expire will “devastate” the U.S. economy, while letting a payroll tax cut for working people to expire would hardly be noticed. Cutting defense spending is economic folly; cutting food stamps for poor children an economic imperative.

My favorite, though, is a proposal, backed by nearly all the candidates along with the U.S. Chamber of Commerce, to allow big corporations to bring home, at a greatly reduced tax rate, the more than $1 trillion in profits they have stashed away in foreign subsidiaries.

“Repatriation,” as it is called, was tried during the “jobless recovery” of the Bush years, with the promise that it would create 500,000 jobs over two years as corporations reinvested the cash in their U.S. operations. According to the most definitive studies of what happened, however, most of the repatriated profits weren’t used to hire workers or invest in new plants and equipment. Instead, they were used to pay down debt or buy back stock.

But fear not. In a new paper prepared for the chamber, Republican economist Douglas Holtz-Eakin argues that just because the money went to creditors and investors doesn’t mean it didn’t create jobs. After all, creditors and shareholders are people, too — people who will turn around and spend most of it, in the process increasing the overall demand for goods and services. As a result, Holtz-Eakin argues, a dollar of repatriated profit would have roughly the same impact on the economy as a dollar under the Obama stimulus plan, or in the case of $1 trillion in repatriated profit, about 3 million new jobs.

It’s a lovely economic argument, and it might even be right. But for Republican presidential candidates, it presents a little problem. You can’t argue, at one moment, that putting $1 trillion of money in the hands of households and business failed to create even a single job, and at the next moment argue that putting an extra $1 trillion in repatriated profit into their hands will magically generate jobs for millions.

It took a while, but even Richard Nixon came around to declaring himself a Keynesian. Maybe there is still hope for Perry and the gang.

By: Steve Pearlstein, Columnist, The Washington Post, September 10, 2011

September 14, 2011 Posted by | Affordable Care Act, Banks, Class Warfare, Congress, Conservatives, Constitution, Economic Recovery, Economy, Environment, Environmental Protection Agency, Federal Budget, Global Warming, GOP, Government, Health Reform, Ideologues, Ideology, Jobs, Medicaid, Medicare, Middle Class, Politics, Public, Regulations, Republicans, Right Wing, Social Security, Taxes, Tea Party, U.S. Chamber of Commerce, Unemployed, Wealthy | , , , , , , , , , , , | Leave a comment

Romney’s Stupidest Idea Of The Week

One of the signature policy proposals that Mitt Romney outlined in his economic plan and highlighted in his USA Today op-ed last week is a policy that is as pernicious in practice as it sounds unthreatening. On page 61 of his plan, Romney proposes to cap the rate at which agencies would impose new regulations at zero. This means that if an agency is required by law to issue a new regulation, it must offset the costs, presumably by eliminating some other regulations. Essentially, Romney is proposing to adopt pay-as-you-go budgeting to regulations.

It’s not entirely clear if this rule applies to each agency—would the Food and Drug Administration have to eliminate some food inspection rules if they created some new regulations of food?—or if this is government-wide policy, so if the government creates rules in one area, it would be required to undo rules in another, unrelated area. But either way, this policy would have far-reaching negative consequences. Imagine, for instance, if a cap on regulations was in place after the financial crisis, when lack of regulation of Wall Street led to the cratering of the economy. Under this proposal, in order to regulate Wall Street to ensure that economic devastation couldn’t happen again, the federal government would have to eliminate regulations on food or water or air, or some other protections. Where is the logic of undoing clean air regulations because new consumer protections are needed?

Behind this policy response is a simple animosity towards any rules for businesses that come at the expense of profits. Republicans have been arguing that regulatory uncertainty is hurting job growth because businesses supposedly refuse to make hiring decisions when they don’t know what the rules will be. But if anything were going to feed uncertainty, it would be a rule that haphazardly and randomly picks old rules to eliminate once new rules were created. Companies make decisions about their future assuming those regulations stay in place; eliminating old regulations will simply favor some firms over others.

The bigger point to be made, however, is that regulations are not what are ailing our economy now, nor are they hindering growth. McClatchy recently surveyed small business owners on why they weren’t employing additional people—none offered regulation among the barriers to hiring. (That’s why it’s particularly unfortunate that the president recently fed the Republican obsession with his suspension of the ozone rule, citing “regulatory uncertainty, particularly as our economy continues to recover,” as part of his rationale.) In fact, if anything, greater regulation can be correlated with greater growth: Over the last 50 years, the decades of the highest growth rates for our economy saw the greatest expansion of government and its regulations. Growth rates were highest in the 1960s at 4.55 percent for the decade, when we created Medicare, Medicaid, and the Great Society poverty programs—our greatest expansion of government. And growth rates were the lowest in the last decade, averaging only 1.38 percent. I think it is safe to say George Bush was not a friend of regulation.

But if regulations aren’t the culprit, what is? What’s holding up hiring now is that there is not enough demand in the economy. Even bond traders like Bill Gross acknowledge the need for direct federal help for job creation and growth. To actually create jobs, Republicans should come to the table with the president and pass ideas they have supported in the past, like investment in roads and bridges and hiring teachers who have been laid off. But because Republican ideology will not tolerate federal policies that actually help create jobs, they are reduced to pithy sounding policies on regulations that are just another way of getting rid of protections for consumers in order to help corporations.

As a former policy director on a presidential campaign, I am sympathetic to the desire to try to propose “new” policy ideas that sound good in a speech or a press paper. In the back and forth of a campaign, reporters, campaign press staff, and even the candidates can demand new policies in areas that have been well-trodden and don’t typically make for exciting speeches. But a serious candidate has to put forward serious ideas to solve actual problems. And for a candidate trying to distinguish himself from a Texas governor ready to shoot from the hip, Mitt Romney’s cap on regulation does not meet that test.

 

By: Neera Tanden, COO, Center for American Progress, Published in The New Republic, September 12, 2011

September 12, 2011 Posted by | Businesses, Congress, Conservatives, Consumers, Corporations, Democrats, Economic Recovery, Economy, Elections, Environment, GOP, Government, Ideologues, Ideology, Jobs, Lawmakers, Medicaid, Medicare, Middle Class, Politics, Public, Regulations, Republicans, Right Wing, Teaparty, Voters | , , , , | Leave a comment

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