“Tax Cuts Don’t Increase Revenue”: This Is What Happens When Republicans Actually Enact Their Radical Agenda
A persistent elite Washington trope, embodied by folks like Ron Fournier, says that bipartisanship is the key missing ingredient in our system of government. The two parties just need to stop their partisan bickering and join hands to hammer out serious, substantive compromises (read: slash social insurance).
It’s certainly the case that because of U.S. constitutional design, compromise is necessary during times of divided government — and the ones who won’t do it are ultraconservative Republicans. But there’s another model of governance that gets short shrift among the lovers of bipartisanship: letting election winners implement their agenda. By providing clear lines of accountability and making clear who is responsible for which policy, allowing an election winner to govern makes democracy work.
We see this today in Kansas of all places, where Gov. Sam Brownback is in an unexpectedly tight re-election race:
Although every statewide elected official in Kansas is a Republican and President Obama lost the state by more than 20 points in the last election, Mr. Brownback’s proudly conservative policies have turned out to be so divisive and his tax cuts have generated such a drop in state revenue that they have caused even many Republicans to revolt. Projections put state budget shortfalls in the hundreds of millions of dollars annually, raising questions of whether the state can adequately fund education in particular. [The New York Times]
Brownback’s tax cuts were passed back in 2012 with the help of Arthur Laffer, the conservative policy hand who has made his career insisting in the teeth of contrary evidence that tax cuts increase revenue. Multiple experts warned that the Brownback-Laffer plan would actually crater the state revenue collection, but Brownback ignored them and did what he wanted. The results are in, and it turns out when you cut taxes, you decrease revenue:
Kansas has a problem. In April and May, the state planned to collect $651 million from personal income tax. But instead, it received only $369 million. [The New York Times]
Naturally, the cuts have required more cuts to critical government services, and most of the tax benefits have been vacuumed up by the rich. Worse still, the promised job-creating effects have also failed to appear. On the contrary, Kansas has actually been performing worse than its neighbors on the jobs front.
In short, movement conservatism produces garbage economic policy. But the beauty is, now that fact is obvious to almost everyone in Kansas, including a bunch of Republicans. To his credit, Brownback actually believed in his ideas and put them in place. He is now paying the price for taking that risk.
Contrast that to the elite D.C. idea of bipartisanship, in which the ancient grandees from both parties get together, and through the magic of high-minded civil discussion, iron out a compromise to cut Social Security and Medicare, preferably by enough to be called a “Grand Bargain.” This has the not-coincidental effect of making it impossible for most people to figure out who is responsible for what — and very easy for either side to spin negative consequences as the other side’s fault.
Now, Brownback may well pull out a victory in the end. But Kansas is a very conservative state, and he ought to be cruising to a huge reelection. Future Republicans may well try to jam through similar tax policies copy-pasted from a conservative think tank’s guide to enriching the wealthy, but the colossal failure of the Brownback cuts will surely give them pause.
Government by the permanent D.C. establishment used to at least keep the country on two legs, but with ideologically well-sorted parties, one of them increasingly extreme, it’s come perilously close to breaking down multiple times. When considering reforms to the structure of government, as I believe will be necessary sometime in the future, we should keep in mind stories like this one. Democracy works best when the voters have meaningful and comprehensible choices.
By: Ryan Cooper, The Week, September 17, 2014
“Tell The Misses Not To Wait Up”: Florida Congressman Finds New Ways To Alienate Women
This election season, there are really only a handful of House Republican incumbents who are in real trouble. Freshman Rep. Steve Southerland (R), who narrowly won in his North Florida district in 2012, is one of them.
In a district in which registered Democrats outnumber Republicans, it seems Southerland would be smart to play it safe and try to avoid alienating key constituencies. And yet, the GOP congressman seems to have a knack for pushing women voters away.
For example, Southerland was recently caught misleading voters about his vote on the Violence Against Women Act. Making matters worse, voters recently learned the conservative lawmaker hosted a men-only fundraising event a few months ago. The invitation, obtained by BuzzFeed, encouraged attendees to “tell the misses not to wait up” because “the after dinner whiskey and cigars will be smooth & the issues to discuss are many.”
Southerland’s opponent, school administrator Gwen Graham (D), criticized the fundraiser, prompting the congressman to make matters just a little worse.
Asked to respond to the Democrats’ criticism that he’s anti-women, Southerland laughed and said: “I live with five women. That’s all I’m saying. I live with five women. Listen: Has Gwen Graham ever been to a lingerie shower? Ask her. And how many men were there?”
He didn’t appear to be kidding. In Southerland’s mind, a sitting congressman hosting a policy discussion with donors is comparable to women hosting a “lingerie shower.”
Just as an aside, I’ll confess to having the exact same reaction to this as the Miami Herald’s Marc Caputo: “What’s a ‘lingerie shower?’ Most people know what baby showers are. And a few are probably familiar with lingerie shows. To combine the two is kinda creepy.” When a reader noted that “lingerie showers” are usually held for brides to be, Caputo added, “And that makes Southerland’s comment even less helpful to his cause.”
MSNBC’s Anna Brand talked to Gwen Graham’s campaign manager about Southerland’s comments.
Graham’s campaign manager Julia Gill Woodward responded to the comparison to msnbc, saying “This isn’t just stuff Steve Southerland says; given his pattern of troubling actions and disturbing comments, it is obviously what Steve Southerland believes. Southerland says these things out of a fundamental disrespect for women.”
“Only if Southerland disrespects women could he hold an official, Men-Only Southerland campaign fundraiser and laugh it off after the fact,” Woodward continued. “Only if Southerland disrespects women could he air TV ads claiming to have voted for The Violence Against Women Act while he actually voted against it in Congress. Only if Southerland disrespects women could he make this insulting ‘lingerie party’ comment about a woman like Gwen Graham.”
The DCCC’s interest in this race was strong before. I have a hunch it just got stronger.
By: Steve Benen, The Maddow Blog, September 15, 2014
“How Not To Get Your Country Back”: Americans Who Want Their Country Back Should Follow Their Elders’ Example
The Tea Party mantra, “I want my country back,” resonates with many. The racial undertones can be ugly (as well as pointless). But the longing for an economically secure America centered on a strong middle class is on point and widely shared.
Older and mostly white members of the far right tend to see themselves as model Americans who worked hard, saved up and played by the rules. They may have done all the above, but many also have no idea of how easy they had it.
After World War II, Americans with no college could walk into a factory and obtain a job paying middle-class wages. Global competition was a future threat. Today’s retirees are among the last Americans to enjoy the most golden of benefits, including a defined pension check, guaranteed for the rest of their lives.
More troubling than the tunnel vision, though, is the right’s program for restoring the country it purports to miss. The ideological obsession with slashing taxes, shrinking government and keeping labor as cheap as possible is downright destructive.
The America of yore did not build its middle class that way.
When President Dwight Eisenhower backed the construction of the interstate highway system in 1956, the top marginal rate for individual income taxes was 91 percent. Older taxpayers bore their burdens more or less stoically (and there wasn’t Medicare to pay their parents’ doctor bills). Building America was the public-spirited thing to do.
Fast-forward to the economic crash of 2008. The infrastructure was in shambles and unemployment high. Robust stimulus spending was the ticket out of both dilemmas. But even though the top marginal rate was only 35 percent, fringe conservatives controlling the Republican Party fought against government intervention every inch of the way — lest Congress raise taxes one dime.
Kansas has become the patient on which to conduct this experiment at its most extreme, and the results are disastrous. Gov. Sam Brownback pushed through wild tax cuts, mainly benefiting the well-to-do, while placing Kansas classrooms, libraries and other public services on a starvation diet.
And what do Kansans have to show for it? The tax cuts drained their state of $300 million in expected revenues for the recent fiscal year. (Where’s that explosion of economic activity that the theorists said would make up the difference?) Meanwhile, earnings are falling faster and jobs growing more slowly than the national average.
The bond rating agencies remain unimpressed. Moody’s and Standard & Poor’s have lowered Kansas’ credit rating, making it more expensive for the state to borrow.
Study after economic study shows the 21st-century spoils going to the educated. And here we have Kansas cannibalizing its schools just as competing states are restoring their education spending.
One wishes older conservatives opposed to raising the minimum wage, now $7.25 an hour, took an honest look at the wages government guaranteed them back when. The minimum wage in 1968 was the equivalent of $10.90 in today’s dollars.
A new study of the 20 major economies finds the U.S. minimum wage among the lowest relative to the country’s average wage. China, Brazil and Turkey did better.
The minimum wage helps less skilled workers but also influences the pay levels higher up the scale. Putting more money in the pockets of those likeliest to spend it fuels economic demand.
Tax policy does matter, and there is such a thing as government waste. But in the end, a middle class is nurtured on good schools, roads and other public services. They cost money.
Americans who want their middle-class country back should follow their elders’ example. A little gratitude would be nice, too.
By: Froma Harrop, The National Memo, September 16, 2014
“The Inflation Cult”: The Broad Appeal Of Prophets Whose Prophecies Keep Failing
Wish I’d said that! Earlier this week, Jesse Eisinger of ProPublica, writing on The Times’s DealBook blog, compared people who keep predicting runaway inflation to “true believers whose faith in a predicted apocalypse persists even after it fails to materialize.” Indeed.
Economic forecasters are often wrong. Me, too! If an economist never makes an incorrect prediction, he or she isn’t taking enough risks. But it’s less common for supposed experts to keep making the same wrong prediction year after year, never admitting or trying to explain their past errors. And the remarkable thing is that these always-wrong, never-in-doubt pundits continue to have large public and political influence.
There’s something happening here. What it is ain’t exactly clear. But as regular readers know, I’ve been trying to figure it out, because I think it’s important to understand the persistence and power of the inflation cult.
Whom are we talking about? Not just the shouting heads on CNBC, although they’re certainly part of it. Rick Santelli, famous for his 2009 Tea Party rant, also spent much of that year yelling that runaway inflation was coming. It wasn’t, but his line never changed. Just two months ago, he told viewers that the Federal Reserve is “preparing for hyperinflation.”
You might dismiss the likes of Mr. Santelli, saying that they’re basically in the entertainment business. But many investors didn’t get that memo. I’ve had money managers — that is, professional investors — tell me that the quiescence of inflation surprised them, because “all the experts” predicted that it would surge.
And it’s not as easy to dismiss the phenomenon of obsessive attachment to a failed economic doctrine when you see it in major political figures. In 2009, Representative Paul Ryan warned about “inflation’s looming shadow.” Did he reconsider when inflation stayed low? No, he kept warning, year after year, about the coming “debasement” of the dollar.
Wait, there’s more: You find the same Groundhog Day story when you look at the pronouncements of seemingly reputable economists. In May 2009, Allan Meltzer, a well-known monetary economist and historian of the Federal Reserve, had an Op-Ed article published in The Times warning that a sharp rise in inflation was imminent unless the Fed changed course. Over the next five years, Mr. Meltzer’s preferred measure of prices rose at an annual rate of only 1.6 percent, and his response was published in another op-ed article, this time in The Wall Street Journal. The title? “How the Fed Fuels the Coming Inflation.”
So what’s going on here?
I’ve written before about how the wealthy tend to oppose easy money, perceiving it as being against their interests. But that doesn’t explain the broad appeal of prophets whose prophecies keep failing.
Part of that appeal is clearly political; there’s a reason why Mr. Santelli yells about both inflation and how President Obama is giving money away to “losers,” why Mr. Ryan warns about both a debased currency and a government that redistributes from “makers” to “takers.” Inflation cultists almost always link the Fed’s policies to complaints about government spending. They’re completely wrong about the details — no, the Fed isn’t printing money to cover the budget deficit — but it’s true that governments whose debt is denominated in a currency they can issue have more fiscal flexibility, and hence more ability to maintain aid to those in need, than governments that don’t.
And anger against “takers” — anger that is very much tied up with ethnic and cultural divisions — runs deep. Many people, therefore, feel an affinity with those who rant about looming inflation; Mr. Santelli is their kind of guy. In an important sense, I’d argue, the persistence of the inflation cult is an example of the “affinity fraud” crucial to many swindles, in which investors trust a con man because he seems to be part of their tribe. In this case, the con men may be conning themselves as well as their followers, but that hardly matters.
This tribal interpretation of the inflation cult helps explain the sheer rage you encounter when pointing out that the promised hyperinflation is nowhere to be seen. It’s comparable to the reaction you get when pointing out that Obamacare seems to be working, and probably has the same roots.
But what about the economists who go along with the cult? They’re all conservatives, but aren’t they also professionals who put evidence above political convenience? Apparently not.
The persistence of the inflation cult is, therefore, an indicator of just how polarized our society has become, of how everything is political, even among those who are supposed to rise above such things. And that reality, unlike the supposed risk of runaway inflation, is something that should scare you.
By: Paul Krugman, Op-Ed Columnist, The New York Times, September 12, 2014
“A Crass Political Stunt”: Christians Enraged With Cruz Over Pro-Israel Comments
Christian writers are incensed with Sen. Ted Cruz, and argue that the Texas senator is putting politics before his fellow religious brethren.
Cruz was the keynote speaker Wednesday evening at a dinner put on by In Defense of Christians, a group dedicated to raising awareness about persecuted Christians in the Middle East. During his speech, the Texas senator argued that Christians have “no greater ally” than Israel. Soon after, heckling from the crowd cut off his remarks, and an address that started by emphasizing the unity of Christians ended with shouting and disagreement.
“If you will not stand with Israel and the Jews, then I will not stand with you,” Cruz told the audience as he walked off the stage.
Much of his pro-Israel conservative base would have had no problem with these comments, so Cruz may not have expected a backlash. But the response among key Christian thinkers and writers was fierce and immediate.
Cruz was accused of ignorance about the dynamics of Middle Eastern Christianity; of suggesting that he would not stand with Christians who didn’t agree with his political stance on Israel; even of orchestrating a crass stunt on the backs of persecuted Christians.
“Sen. Ted Cruz suggested that holding the same political views on Israel was more important than the fellowship we share as Christians,” Mollie Hemingway, a senior writer at The Federalist, a conservative website, told The Daily Beast. “We shouldn’t fight the global persecution of Christians only if the victims share our political views.”
Added Mark Tooley, the president of the Institute on Religion and Democracy: “Must overseas Christians pass a political litmus test, even if it further endangers them, to gain American support and sympathy?”
Jeff King, the president of the watchdog group International Christian Concern, said that Cruz was “off-topic and rude” (the crowd was rude too, King added), but mainly did not understand the nuances of the persecuted Christian minority groups he was addressing.
“They can’t be pro-Israel where they live, because they will get the snot beaten out of them or worse. If you don’t understand the dynamics going in… you’ve got to question what he was thinking,” King said. “He just doesn’t understand the reality of Middle Eastern Christians.”
Others went so far as to question whether Cruz purposely went to the conference as a stunt, that he was aware of the dynamics and wanted to show that he would support Israel in front of an audience where this would be unpopular.
“He used arguably the most persecuted and powerless minority in the world, Middle Eastern Christians, who are supposed to be his brethren in Christ, as a prop for a self-aggrandizing political stunt,” said Pascal-Emmanuel Gobry, a Catholic writer, in The Week.
New York Times columnist Ross Douthat was particularly scathing, pointing out that Cruz’s “co-religionists are being murdered.”
“[B]y making a statement at *this* event, he basically flipped the bird to people and churches that are dying right now,” he tweeted.
Some conservative websites weighed in in support of Cruz, but may have overstepped in doing so—with two websites implying that the Middle Eastern Christians present at the event were not Christians at all.
Both Breitbart News and Townhall wrote defenses that put the word “Christian” in scare quotes—as if those who heckled Cruz might not appropriately be termed so. Breitbart has since taken down the quotation marks.
Christian writers were mixed on whether Cruz’s remarks could have an enduring political effect.
“There are potential repercussions—particularly if this becomes a trend. To be sure, there is often a stark dichotomy between so-called opinion leaders and rank and file believers. But there’s a reason they’re called leaders,” Daily Caller writer Matt Lewis, who was critical of Cruz’s speech, told the Beast. “The folks who have voiced concern about his actions buy ink by the barrel and paper by the ton, and people turn to them for interpreting events. There is always the potential for this sort of thing to trickle down.”
Countered Tooley, “Religious persecution has rarely been major issue in electoral politics.”
Democrats might also seek to capitalize on Cruz’s statement. Michael Wear, a strategist who led White House evangelical outreach during President Obama’s first term, said that Republican “voters will be looking for a candidate who can support Israel without demeaning an audience gathered to defend persecuted religious groups, a cause Senator Cruz has now distracted from in order to defend himself.”
Catherine Frazier, a Cruz spokeswoman, told the Beast that the senator will continue to speak out on behalf of religious minorities everywhere, and has made a point of bringing public attention to persecuted Christians in particular.
“He does not agree or stand with those who do not believe that Israel has the right to exist as a Jewish state,” Frazier said. “But that does not change his passion and priority for standing with persecuted Christians across the region and across the world.”
In the meantime, however, Cruz’s remarks appear to have at least temporarily shattered Christian solidarity on the issue of persecuted Christian minorities.
“Fighting persecution of Christians is a unifying message among voters, particularly on the right,” Hemingway said. “For better or worse, Cruz’s political speech may have broken that unity.”
By: Tim Mak, The Daily Beast, September 12, 2014
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