“From Dysfunction To Malfunction”: Mitch McConnell And The Limits Of Scorched-Earth Obstructionism
As the Senate Republicans’ leader, Mitch McConnell launched an experiment of sorts during the Obama era. It was a strategy without precedent in the American tradition, and it was arguably a historic gamble that wasn’t guaranteed to work. But the Kentucky Republican and his allies did it anyway.
And as the calendar turns from November to December, it’s worth appreciating that last month was arguably the most informative to date when it comes to the results of this experiment – it was a month that crystallized the ways in which the GOP gambit was an extraordinary success and the ways in which it failed in ways McConnell didn’t expect.
McConnell’s master strategy was elegant in its simplicity: after his party was soundly rejected by voters in 2006 and 2008, McConnell came to believe recovery was dependent on unprecedented obstructionism. Republicans, the GOP leader decided, would simply say no to everything – regardless of merit or consequence, even when Democrats agreed with them.
The point, as McConnell has acknowledged many times, was to deny President Obama and his allies the all-important cover of bipartisanship – when an idea enjoys support from both parties, it’s effectively the Good Housekeeping Seal of Approval for the American mainstream. But if Republicans embraced blanket opposition to literally every Democratic proposal, the public would assume Obama was failing to bring the parties together behind a sound, moderate agenda. The gridlock would be crushing, but McConnell assumed the media and much of the electorate would simply blame the White House, even if that didn’t make any factual sense.
It worked. The American legislative progress has turned from dysfunction to malfunction over the last four years, creating a Congress that fails to complete even routine tasks, and those responsible for creating the worst governing conditions since the Civil War were broadly rewarded by voters. Obama went being from the popular, post-partisan leader who would repair the nation’s ills – an FDR for the 21st century – to the president with a meager approval rating who hasn’t signed a major bill into law since 2010.
As the results came in on Election Night, Vox.com made a compelling case that described Mitch McConnell as “the greatest strategist in contemporary politics.”
It’s tough to disagree, right? Republicans intended to destroy the American legislative process, and they did. Republicans set out to exacerbate partisan tensions, and they did. Republicans hoped to make Obama less popular by making it vastly more difficult for him to get anything done, and they did. Republicans hoped to parlay public discontent into electoral victories, and they did. Republicans made a conscious decision to prevent the president from bringing the country together, and they successfully made the national chasm larger.
There’s just one thing McConnell & Co. forgot: a gamble like this can be a strategic success and a substantive failure at the same time.
Consider this report, which ran on Thanksgiving.
President Obama could leave office with the most aggressive, far-reaching environmental legacy of any occupant of the White House. Yet it is very possible that not a single major environmental law will have passed during his two terms in Washington.
Instead, Mr. Obama has turned to the vast reach of the Clean Air Act of 1970, which some legal experts call the most powerful environmental law in the world. Faced with a Congress that has shut down his attempts to push through an environmental agenda, Mr. Obama is using the authority of the act passed at the birth of the environmental movement to issue a series of landmark regulations on air pollution, from soot to smog, to mercury and planet-warming carbon dioxide.
It seems counterintuitive, but President Obama simply doesn’t need Congress to advance one of the most sweeping and ambitious environmental agendas in generations.
With this in mind, McConnell’s strategy worked exactly as intended, producing the precise results Republicans were counting on, but the plan failed to appreciate what an ambitious president can still do with the powers of the presidency.
It’s not just the environment, of course. McConnell’s plan was also intended to destroy immigration reform, which was effective right up until Obama identified a legal way around Congress, helping millions of families in the process. Jon Chait added:
The GOP has withheld cooperation from every major element of President Obama’s agenda, beginning with the stimulus, through health-care reform, financial regulation, the environment, long-term debt reduction, and so on. That stance has worked extremely well as a political strategy. […]
The formula only fails to work if the president happens to have an easy and legal way to act on the issue in question without Congress. Obama can’t do that on infrastructure, or the grand bargain, and he couldn’t do it on health care. But he could do it on immigration.
And the environment. And in addressing the Ebola threat. And in targeting ISIS.
The irony is, had McConnell pursued a different approach, he could have advanced more conservative policy goals. If Republicans had worked with Democrats on health care, the Affordable Care Act would have included provisions with the right. If McConnell were willing to deal on immigration, Obama would have endorsed a more conservative approach than the executive actions announced two weeks ago. If the GOP made an effort to work with the White House on energy, Obama’s environmental vision would almost certainly have more modest goals.
Republicans might have been better off – which is to say, they would have ended up with a more conservative outcome – if they’d actually compromised and taken governing seriously in some key areas.
But McConnell thought it’d be easier to win through scorched-earth obstructionism.
Again, as of next month, he’ll be the Senate Majority Leader, so maybe he doesn’t care about the substantive setbacks. But for all the GOP gains at the ballot box, it’s Obama, not Republicans, moving a policy agenda forward.
By: Steve Benen, The Maddow Blog, December 1, 2014
“And Has The Legal Authority”: Poll; Americans Broadly Back Obama’s Immigration Executive Action
Americans are very open to President Barack Obama’s newly announced executive action to shield millions of undocumented immigrants from deportation, according to a Hart Research Associates survey released Friday.
The poll, which was conducted on behalf of the liberal 501(c)(4) “dark money” group Americans United for Change, described the president’s policy as follows:
The action would direct immigration enforcement officials to focus on threats to national security and public safety, and not on deporting otherwise law-abiding immigrants. Immigrants who are parents of children who are legal US residents could qualify to stay and work temporarily in the United States, without being deported, if they have lived in the United States for at least five years, pay taxes, and pass a criminal background check.
After hearing that description, voters overwhelmingly backed President Obama’s move: 67 percent viewed it favorably, while just 28 percent viewed it unfavorably. The support was fairly bipartisan, with 91 percent of Democrats, 67 percent of Independents, and 41 percent of Republicans viewing the executive action favorably. Among Tea Party Republicans, however, 64 percent opposed the policy while just 30 percent viewed it favorably.
The results underscore the importance of President Obama’s sales job with regard to his executive action. Previous polls have found that voters abstractly disapprove of the president circumventing Congress to deal with immigration. A USA Today poll released Monday, asking “Should President Obama take executive action this year to deal with illegal immigration or should he wait until January for the new Republican Congress to pass legislation on this issue,” found that 42 percent wanted the president to act now, while 46 percent preferred that he wait. Similarly, an NBC News/Wall Street Journal poll released Wednesday found that 48 percent disapproved of President Obama taking executive action while 38 percent approved, without being told any of the details of the president’s plan.
But, as Hart Research found, voters strongly support the specifics of President Obama’s executive action. They favor allowing the parents of children living legally in the United States to stay in the country by a 40 percent margin, expanding the Deferred Action for Childhood Arrivals (DACA) program by 36 percent, providing temporary work permits to qualifying immigrants by 55 percent, and shifting more security resources to the U.S.-Mexico border by 63 percent.
Democrats already seem to be winning one important aspect of the messaging fight; the poll found that — despite outspoken Republican outrage — voters agree, 51 to 41 percent, that President Obama has the legal authority to change the nation’s immigration enforcement policies.
The Hart Research Associates poll surveyed 800 likely 2016 voters from November 19 to 20, 2014, and has a +/- 3.5 percent margin of error.
By: Henry Decker, The National Memo, November 21, 2014
“Rock Bottom Economics”: The Inflation And Rising Interest Rates That Never Showed Up
Six years ago the Federal Reserve hit rock bottom. It had been cutting the federal funds rate, the interest rate it uses to steer the economy, more or less frantically in an unsuccessful attempt to get ahead of the recession and financial crisis. But it eventually reached the point where it could cut no more, because interest rates can’t go below zero. On Dec. 16, 2008, the Fed set its interest target between 0 and 0.25 percent, where it remains to this day.
The fact that we’ve spent six years at the so-called zero lower bound is amazing and depressing. What’s even more amazing and depressing, if you ask me, is how slow our economic discourse has been to catch up with the new reality. Everything changes when the economy is at rock bottom — or, to use the term of art, in a liquidity trap (don’t ask). But for the longest time, nobody with the power to shape policy would believe it.
What do I mean by saying that everything changes? As I wrote way back when, in a rock-bottom economy “the usual rules of economic policy no longer apply: virtue becomes vice, caution is risky and prudence is folly.” Government spending doesn’t compete with private investment — it actually promotes business spending. Central bankers, who normally cultivate an image as stern inflation-fighters, need to do the exact opposite, convincing markets and investors that they will push inflation up. “Structural reform,” which usually means making it easier to cut wages, is more likely to destroy jobs than create them.
This may all sound wild and radical, but it isn’t. In fact, it’s what mainstream economic analysis says will happen once interest rates hit zero. And it’s also what history tells us. If you paid attention to the lessons of post-bubble Japan, or for that matter the U.S. economy in the 1930s, you were more or less ready for the looking-glass world of economic policy we’ve lived in since 2008.
But as I said, nobody would believe it. By and large, policy makers and Very Serious People in general went with gut feelings rather than careful economic analysis. Yes, they sometimes found credentialed economists to back their positions, but they used these economists the way a drunkard uses a lamppost: for support, not for illumination. And what the guts of these serious people have told them, year after year, is to fear — and do — exactly the wrong things.
Thus we were told again and again that budget deficits were our most pressing economic problem, that interest rates would soar any day now unless we imposed harsh fiscal austerity. I could have told you that this was foolish, and in fact I did, and sure enough, the predicted interest rate spike never happened — but demands that we cut government spending now, now, now have cost millions of jobs and deeply damaged our infrastructure.
We were also told repeatedly that printing money — not what the Fed was actually doing, but never mind — would lead to “currency debasement and inflation.” The Fed, to its credit, stood up to this pressure, but other central banks didn’t. The European Central Bank, in particular, raised rates in 2011 to head off a nonexistent inflationary threat. It eventually reversed course but has never gotten things back on track. At this point European inflation is far below the official target of 2 percent, and the Continent is flirting with outright deflation.
But are these bad calls just water under the bridge? Isn’t the era of rock-bottom economics just about over? Don’t count on it.
It’s true that with the U.S. unemployment rate dropping, most analysts expect the Fed to raise interest rates sometime next year. But inflation is low, wages are weak, and the Fed seems to realize that raising rates too soon would be disastrous. Meanwhile, Europe looks further than ever from economic liftoff, while Japan is still struggling to escape from deflation. Oh, and China, which is starting to remind some of us of Japan in the late 1980s, could join the rock-bottom club sooner than you think.
So the counterintuitive realities of economic policy at the zero lower bound are likely to remain relevant for a long time to come, which makes it crucial that influential people understand those realities. Unfortunately, too many still don’t; one of the most striking aspects of economic debate in recent years has been the extent to which those whose economic doctrines have failed the reality test refuse to admit error, let alone learn from it. The intellectual leaders of the new majority in Congress still insist that we’re living in an Ayn Rand novel; German officials still insist that the problem is that debtors haven’t suffered enough.
This bodes ill for the future. What people in power don’t know, or worse what they think they know but isn’t so, can very definitely hurt us.
By: Paul Krugman, Op-Ed Columnist, The New York Times, November 23, 2014
“The Great National ‘Franksgiving’ Uproar”: Imagine The Reaction If Obama Used An Executive Order To Change Date Of A Major Holiday
The story of Franklin Roosevelt moving Thanksgiving is probably pretty well known, but with the holiday coming up tomorrow, and with the ongoing debate about executive powers apparently fresh on the political world’s mind, it’s probably worth a trip down memory lane.
Historically, Thanksgiving was celebrated on the final Thursday of November. But in 1939, with the nation still dealing with the effects of the Great Depression and the unemployment rate above 15%, there was a small problem with the calendar: Thanksgiving fell on Nov. 30.
This may not sound especially important, but for businesses relying on holiday sales, this was a threat to bottom lines – it shortened the number of shopping days between Thanksgiving and Christmas. Business owners, pointing to the weak economy, demanded action.
And FDR delivered, issuing an executive order that moved the official date of Thanksgiving up a week, from Nov. 30 to Nov. 23. As Andrew Prokop explained, this really didn’t go over well.
What may have seemed like a wonkish, technocratic, good-government policy clashed with what turned out to be deeply-ingrained feelings among many Americans about when Thanksgiving should be celebrated. The Associated Press story announcing the move said Roosevelt “was shattering another precedent,” and quoted a town official of Plymouth, Massachusetts saying the traditional date was “sacred.” […]
Republicans pounced, and used the move to portray Roosevelt as a power-mad tyrant. In an early example of Godwin’s Law, FDR’s recent presidential opponent Alf Landon said Roosevelt sprung his decision on “an unprepared country with the omnipotence of a Hitler.” Senator Styles Bridges of New Hampshire suggested that while Roosevelt was at it, he should abolish winter.
One Republican mayor labeled the new date “Franksgiving.” Extending the protest further, roughly half the states chose to honor the old date rather than the new one.
The date then bounced around for a couple of years, until Congress eventually passed a new law, moving the date from the final Thursday in November to the fourth Thursday in November.
So, FDR and businesses owners scored a partial win, at least insofar as the Nov. 30 problem is concerned.
The thing I like about this story now is its contemporary salience: President Obama, for example, is not the first Democratic president that Republicans compared to Hitler.
Plus, try to imagine the reaction if Obama used an executive order to change the date of a major holiday without congressional approval. If his critics go berserk when he uses prosecutorial discretion on immigration, Republicans might very well faint if Thanksgiving moved to create more shopping days.
By: Steve Benen, The Maddow Blog, November 27, 2014
“Chief Tax-Dodging Officers”: It’s Gotten Pretty Easy For Large Corporations To Avoid The Taxman
Republican and Democratic leaders don’t often see eye to eye on taxes.
But surprisingly, corporate tax reform looks like one area where there might actually be some potential for bipartisan action in Washington. This should be good news, since our corporate tax system is clearly hopelessly broken.
Here’s a stark indicator of just how broken: Last year, 29 of the 100 highest-paid CEOs made more in personal compensation than their companies paid in federal income taxes. That’s according to a new report by the Institute for Policy Studies and the Center for Effective Government.
Source: Fleecing Uncle Sam, an Institute for Policy Studies and Center for Effective Government report
Yes, it’s gotten that easy for large corporations to avoid the taxman.
This is true even for the country’s wealthiest companies. Citigroup, Halliburton, Boeing, Ford, Chesapeake Energy, Chevron, Verizon, and General Motors all made more than $1 billion in U.S. profits last year, but still paid their CEOs more than they paid Uncle Sam. In fact, most of them got massive tax refunds.
How is this possible?
While big businesses moan about the U.S. corporate tax rate of 35 percent, most of them pay nowhere near that. Between 2008 and 2012, the average large corporation paid an effective rate of less than 20 percent.
Hiding profits in tax havens is one of the most common ways large corporations avoid paying their fair share to the IRS. And indeed, the 31 firms who paid their CEOs more than Uncle Sam operate 237 subsidiaries in low- or no-tax zones like the Cayman Islands and Bermuda.
But that’s just one tax-dodging trick. Corporations have lobbied successfully for a plethora of other tax loopholes and subsidies.
Boeing, for example, has figured out how to double dip in the Treasury’s pool.
The aerospace giant hauled in more than $20 billion in federal contracts in 2013. According to Citizens for Tax Justice, taxpayers also picked up the tab for $300 million of Boeing’s research expenses last year through a tax break that Congress is now considering making permanent.
When tax time came, Boeing got $82 million back from the IRS, despite reporting nearly $6 billion in U.S. pre-tax profits. Meanwhile, Boeing chief executive Jim McNerney made $23.3 million.
Corporate tax dodging is bad for ordinary Americans — and our nation’s long-term economic health.
For example, if Boeing had paid the statutory corporate tax rate of 35 percent on its $6 billion in profits, it would’ve added an extra $2 billion to the funds available for public services. That sum would’ve covered the cost of hiring 2,775 teachers for a year.
Shirking taxes may boost the bottom line in the short term, but in the long run it erodes the economic infrastructure businesses need to be competitive.
Unfortunately, the current political rhetoric has little to do with cracking down on corporate tax avoidance.
Republicans are hooked on corporate tax giveaways. And President Barack Obama has suggested that he’s ready to reward corporations for stashing money overseas by giving them deeply discounted tax rates on their profits if they’ll just agree to bring them home.
Both of these positions are based on the unfounded claim that smaller corporate tax burdens translate into more good jobs.
In a Hart Research poll of voters on election night, only 22 percent favored taxing corporations less. In the same poll, less than 30 percent wanted Congress to make tax cuts a higher priority than investments in education, health care, and job creation.
The American people have their priorities straight. They deserve leaders who do too.
By: Sarah Anderson and Scott Klinger are the co-authors of “Fleecing Uncle Sam”; The National Memo, November 19, 2014
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