“An Effective Ad Man”: Democrats Could Use Their Own Grover Norquist
Here’s the first lesson from the early skirmishing over ways to avoid the fiscal cliff: Democrats and liberals have to stop elevating Grover Norquist, the anti-government crusader who wields his no-tax pledge as a nuclear weapon, into the role of a political Superman.
Pretending that Norquist is more powerful than he is allows Republicans to win acclaim they haven’t earned yet. Without making a single substantive concession, they get loads of praise just for saying they are willing to ignore those old pledges to Grover. You can give him props as a public relations genius. Like Ke$ha or Beyonce, he is widely known in Washington by only one name. But kudos for an openness to compromise should be reserved for Republicans who put forward concrete proposals to raise taxes.
The corollary is that progressives should be unafraid to draw their own red lines. If you doubt that this is a good idea, just look at how effective Norquist has been. Outside pressure from both sides is essential for a balanced deal.
Start by insisting that Social Security and any increase in the retirement age be kept off the table. President Obama’s bargaining hand will be strengthened further if he can tell Republicans that there just aren’t Democratic votes for steep cuts in Medicaid and Medicare. The president’s room for maneuver expands still more if liberals refuse to look at cuts in programs unless Republicans are prepared to raise tax rates on the wealthy.
Already, there are signs that Republicans realize how much leverage the president has. If Congress doesn’t act, all the Bush tax cuts expire at the end of the year. At that point, the Senate’s Democratic majority has the power to block (or Obama can veto) any restoration of the upper-end Bush tax rates.
One indication that Republicans are aware they’re boxed in came from Rep. Tom Cole (R-Okla.), one of his party’s shrewdest political minds. He suggested that Republicans should take up the president’s invitation to extend the Bush tax cuts for the 98 percent of Americans who earn less than $250,000 a year. Yes, this would amount to throwing in the towel on those upper-bracket levies. But Cole knows that it won’t help the Republican brand if voters come to see the GOP’s one and only objective as protecting wealthier Americans from tax increases.
The next lesson is not about politics or PR. It’s about substance, and this is where the Washington establishment has to get serious. The simple fact is that it’s bunk to claim that “tax reform” alone can produce the revenue we need.
One of the great disservices of the Bowles-Simpson commission was that it fed the impression that tax reform could generate so much cash that it would permit a cut in tax rates.
Grant Erskine Bowles and Alan Simpson credit for good intentions — they were desperate to find a way to get Republicans on their commission to acknowledge the need for new revenue. It’s also worth remembering that their proposal assumed the expiration of the Bush tax cuts for those earning more than $250,000 a year. Nonetheless, their stress on tax reform with lower rates was more a political deal than wise policy. They sent us down the wrong path.
The only way tax reform might raise enough money to prevent a rate increase, let alone create an opportunity for rate cuts, is to reduce popular deductions (like the one on mortgage interest) so deeply that middle-class Americans would get a tax increase, too. And eliminating or sharply undercutting the deduction for state and local taxes is a bad idea. This only penalizes higher-tax states that try to solve their own social problems — for example, by providing health insurance to their low-income residents.
And all the schemes to eliminate tax expenditures to avoid rate increases have the effect of protecting just one group: Americans with very high incomes. That’s how the math works.
The right thing is to bring back Bill Clinton’s tax rates on the well-off and then have a broad tax reform discussion next year. A similar logic applies to health-care programs, as Jonathan Cohn suggested in the New Republic. Before making big cuts in Medicaid and Medicare, we need to see whether the reforms in the Affordable Care Act can contain medical inflation.
The fiscal cliff creates an enormous opportunity to end an era in which it was never, ever permissible to raise taxes. In the pre-Grover days, conservatives believed passionately in pay-as-you-go government. A tough stand by progressives will make it easier for conservatives to return to the path of fiscal responsibility.
By: E. J. Dionne, Jr., Opinion Writer, The Washington Post, November 28, 2012
“Unicorn’s And Other Fables”: Grover Norquist’s Latest Plot To Drown Government…Monthly Debt Ceiling Fights
There’s two ways to look at Grover Norquist. He’s either the most powerful unelected man in the world or an amazing self-promoter who is about to be proven obsolete. Norquist obviously feels he’s the former. For nearly two decades, he’s held Republicans to a pledge to never raise taxes. Now he wants them to force the president to cede to their wishes on a monthly basis.
The President of Americans for Tax Reform is urging Republicans to use the debt ceiling to exact spending cuts or continue the Bush tax cuts for incomes over $250,000.
“The debt ceiling that Obama’s plans bump into every month or so for the next four years provides plenty of ‘leverage’ for the GOP to trade for spending cuts — as done in 2011 — or continuing the lower rates,” Norquist wrote Wednesday in The Hill.
Nearly 6 out of 10 Americans want to end the Bush tax breaks for the rich. But enough Republicans in the House and Senate have signed Norquist’s American Taxpayer Pledge that he’s certain that the negotiations on the so-called “fiscal cliff” can end without taxes going up.
After an electoral college landslide, many — including the White House — believe that the president has the leverage in negotiations. But the debt ceiling, which we will hit in February, does give Republicans a chance to make demands on the president.
When President Obama asked Speaker Boehner to raise the debt limit, Boehner reportedly said, “There is a price for everything.”
In 2011, Republicans, for the first time ever, used the debt limit to force cuts — something they never asked for in the dozens of times they raised the limit for the last three Republican presidents.
Though senators Lindsey Graham, Saxby Chambliss and other Republicans have said they would break their pledge with Norquist, the lobbyist seems unfazed. He told Slate’s Dave Weigel that he has no concerns that his pledge is about to crumble.
“I’ve talked to Lindsey Graham on the phone after some of his pronouncements, and he’s said, ‘Oh, I would need 10-1 [ratio of cuts to tax hikes], and it would have to include permanent, unalterable entitlement reform.’ I said, ‘Lindsey, if that’s what it’s going to take to get you to raise taxes, I’m not going to worry about you,” Norquist said. “You are not in danger of being offered a silver unicorn, because unicorns don’t exist.”
The Washington Post’s Greg Sargent keeps insisting that the GOP is just trying to present an appearance of compromise. Some Republicans are making news with their alleged willingness to buck Norquist — but votes speak louder than words.
Unlike many Republicans, Norquist would be pleased if the so-called sequester goes into effect. He’s a Republican who believes the Department of Defense isn’t sacred when it comes to spending cuts.
The question is, how many Republicans would be willing to risk the cuts to Defense along with responsiblty for a middle-class tax increase by holding out for a deal that honors Norquist’s pledge?
And if the president won’t agree, will they doom the United States’ credit and cause unprecedented “uncertainty,” which Republicans claim to hate, by holding the debt limit hostage on a monthly basis?
Even if Republicans were to go down that path, the president would have to adopt a strategy advocated by former president Bill Clinton often called “the 14th Amendment option.”
The amendment includes the sentence, “The validity of the public debt of the United States, authorized by law, including debts incurred for payments of pensions and bounties for services in suppressing insurrection or rebellion shall not be questioned.”
In 2011, Clinton said that “without hesitation” he would invoke the 14th Amendment “and force the courts to stop me.”
President Obama nixed that plan, saying his lawyers didn’t see the validity in it. But if Republicans decided to use the debt ceiling to keep him on an “allowance,” it wouldn’t be hard to imagine him deciding that it was worth going to court.
Norquist has never been shy about his disdain for government. He’s often joked,” I just want to shrink it down to the size where we can drown it in the bathtub.” But he’s never faced a predicament like expiring tax cuts and a president with the political capital to fight to keep some of them expired.
Soon we’ll find out how much power he actually has.
BY: Jason Sattler, The National Memo. November 28, 2012
“Old Habits Die Hard”: Cutting Taxes Doesn’t Cut It For Republicans
If the GOP pushes the economy over the fiscal cliff, the party will go over too. The longer Republicans push for tax breaks for bankers and billionaires, the more trouble they’ll get themselves into. Republicans have enough problems morphing into the Tea Party, now the GOP is becoming a wholly owned subsidiary of the Fortune 500.
The Election Day national exit survey demonstrates the fact that the GOP doesn’t have a good message for Americans who worry about the economy. The voters have spoken and the poll tells us what they have to say about the economy and taxes. Republicans will not like what they hear.
Voters heard the questions that Mitt Romney asked about the president’s handling of the economy, but the GOP nominee didn’t follow up with the answers. It should have been a plus for the challenger that almost half (45 percent) of the voters felt the economy was “not so good.” However, a majority (55 percent to 42 percent) of these distressed voters actually went for Barack Obama over Mitt Romney. Another illustration of the GOP’s failure to address middle class economic concerns was that nine of 10 voters (90 percent) who gave the economy a positive rating voted to re-elect the president but only six out of every 10 (60 percent) voters who gave the economy a negative rating voted for his challenger.
Cutting taxes doesn’t cut it for Republicans. There were more voters who worried about unemployment (38 percent) and rising prices (37 percent) than there were who were concerned about cutting taxes (14 percent). The good news for the GOP was that voters who worried about taxes voted overwhelmingly for Romney. The bad news was that there were too few of these voters to make much of a difference in the outcome. Along the same lines, almost half (47 percent) of the voters wanted to raise taxes on the wealthy and another small group (13 percent) favored raising everybody’s taxes. That’s six out of 10 voters who are open to raising taxes to stabilize the economy. Only a third (35 percent) of the voters wanted to hold the line on taxes.
The failure of Romney and the GOP to come up with anything but cutting taxes leaves Republicans in the lurch. Nature abhors a vacuum and the party’s neglect of jobs and inflation gives voters the chance to fill that vacuum with their feelings about the last Republican president. This isn’t good news for Republicans because a large majority (53 percent to 38 percent) of the electorate blames George W. Bush not Barack Obama for the condition of today’s economy.
Voters want to fight a class war and the president’s populist approach to the economy is just what they wanted. Trickle-down economics was a disaster for Romney and will continue to tarnish the Republican brand if the party doesn’t craft a more comprehensive economic message. More than half (53 percent) of the voters feel that the American economic system favors the rich and only a third (34 percent) think the system is fair to all Americans. A majority (55 percent to 39 percent) of voters also believe that Romney’s policies would have favored the rich over the middle class. A fifth (21 percent) of the voters wanted a president who cares about people and those voters supported the incumbent overwhelmingly (81 percent to 18 percent).
The party’s fixation on taxes means the GOP is riding a one trick pony into the ground. The debate on taxes only focuses attention on the GOP’s inability to come up with anything new. Old habits die hard so President Obama doesn’t have to worry that Republicans will come up with something that works better.
By: Brad Bannon, U. S. News and World Report, November 26, 2012
“Fighting Fiscal Phantoms”:The GOP Hydra-Headed Deficit Scold Movement Has Lost Some Of Its Clout
These are difficult times for the deficit scolds who have dominated policy discussion for almost three years. One could almost feel sorry for them, if it weren’t for their role in diverting attention from the ongoing problem of inadequate recovery, and thereby helping to perpetuate catastrophically high unemployment.
What has changed? For one thing, the crisis they predicted keeps not happening. Far from fleeing U.S. debt, investors have continued to pile in, driving interest rates to historical lows. Beyond that, suddenly the clear and present danger to the American economy isn’t that we’ll fail to reduce the deficit enough; it is, instead, that we’ll reduce the deficit too much. For that’s what the “fiscal cliff” — better described as the austerity bomb — is all about: the tax hikes and spending cuts scheduled to kick in at the end of this year are precisely not what we want to see happen in a still-depressed economy.
Given these realities, the deficit-scold movement has lost some of its clout. That movement, by the way, is a hydra-headed beast, comprising many organizations that turn out, on inspection, to be financed and run by more or less the same people; dig down into many of these groups’ back stories and you will, in particular, find Peter Peterson, the private-equity billionaire, playing a key role.
But the deficit scolds aren’t giving up. Now yet another organization, Fix the Debt, is campaigning for cuts to Social Security and Medicare, even while making lower tax rates a “core principle.” That last part makes no sense in terms of the group’s ostensible mission, but makes perfect sense if you look at the array of big corporations, from Goldman Sachs to the UnitedHealth Group, that are involved in the effort and would benefit from tax cuts. Hey, sacrifice is for the little people.
So should we take this latest push seriously? No — and not just because these people, aside from exhibiting a lot of hypocrisy, have been wrong about everything so far. The truth is that at a fundamental level the crisis story they’re trying to sell doesn’t make sense.
You’ve heard the story many times: Supposedly, any day now investors will lose faith in America’s ability to come to grips with its budget failures. When they do, there will be a run on Treasury bonds, interest rates will spike, and the U.S. economy will plunge back into recession.
This sounds plausible to many people, because it’s roughly speaking what happened to Greece. But we’re not Greece, and it’s almost impossible to see how this could actually happen to a country in our situation.
For we have our own currency — and almost all of our debt, both private and public, is denominated in dollars. So our government, unlike the Greek government, literally can’t run out of money. After all, it can print the stuff. So there’s almost no risk that America will default on its debt — I’d say no risk at all if it weren’t for the possibility that Republicans would once again try to hold the nation hostage over the debt ceiling.
But if the U.S. government prints money to pay its bills, won’t that lead to inflation? No, not if the economy is still depressed.
Now, it’s true that investors might start to expect higher inflation some years down the road. They might also push down the value of the dollar. Both of these things, however, would actually help rather than hurt the U.S. economy right now: expected inflation would discourage corporations and families from sitting on cash, while a weaker dollar would make our exports more competitive.
Still, haven’t crises like the one envisioned by deficit scolds happened in the past? Actually, no. As far as I can tell, every example supposedly illustrating the dangers of debt involves either a country that, like Greece today, lacked its own currency, or a country that, like Asian economies in the 1990s, had large debts in foreign currencies. Countries with large debts in their own currency, like France after World War I, have sometimes experienced big loss-of-confidence drops in the value of their currency — but nothing like the debt-induced recession we’re being told to fear.
So let’s step back for a minute, and consider what’s going on here. For years, deficit scolds have held Washington in thrall with warnings of an imminent debt crisis, even though investors, who continue to buy U.S. bonds, clearly believe that such a crisis won’t happen; economic analysis says that such a crisis can’t happen; and the historical record shows no examples bearing any resemblance to our current situation in which such a crisis actually did happen.
If you ask me, it’s time for Washington to stop worrying about this phantom menace — and to stop listening to the people who have been peddling this scare story in an attempt to get their way.
By: Paul Krugman, Op-Ed Columnist, The New York Times, November 26, 2012
“Unfamiliar Territory, An Unfamiliar Sound”: John McCain Knows The GOP Can’t Win The War On Women
John McCain sounded awfully chastened yesterday. Gone was the bluster of doing “everything in my power to block” Susan Rice from a position she has yet to be nominated for. He didn’t question her competence. The rage gave way to this Sunday morning walkback: “I think she deserves the ability and the opportunity to explain herself and her position, just as she said. But, she’s not the problem. The problem is the president of the United States.”
I doubt McCain is done being an angry, bitter man who still hasn’t forgiven Rice for her attack on him during the 2008 presidential campaign. But someone must have told him that trashing an accomplished, relatively young woman of color who wasn’t even remotely responsible for what happened in Benghazi is just not a good look these days. Maybe McCain underestimated how many people had Rice’s back, from the Congressional Black Caucus to the president himself — just as his fellow party members had underestimated the power of the voting bloc they commanded on Nov. 6.
Similarly, McCain has never been much of an enthusiastic culture warrior (derisive air quotes around women’s health aside) but it was still striking how he basically suggested his party should cede the abortion issue after getting widely rejected by unmarried female voters. “As far as young women are concerned, absolutely, I don’t think anybody like me — I can state my position on abortion. But to — other than that, leave the issue alone.” It might not sound like much, but plenty on the right haven’t quite forgiven Mitch Daniels for suggesting a “truce” on social issues back in 2010, and some of them still think Mitt Romney lost because he didn’t talk about abortion enough.
Obama’s firm defense of Rice and, at least during the campaign, of reproductive rights, are welcome signs of backbone among Democrats. Even before this month’s electoral victories, the party seemed better organized and less apologetic than in recent memory. And no one better exemplifies the virtue of this moment than Sen. Patty Murray, a far less bombastic presence than her colleague McCain who has nonetheless managed to get lots done behind the scenes lately.
Last year, when Murray was put on the budget supercommittee — the only woman, in fact — Grover Norquist sniffed, “The Republicans are serious budget reformers. The lady from Washington doesn’t do budgets.” The serially underestimated Murray subsequently refused to bow to Republican intransigence on said committee, which ended with no deal. Now, as Norquist faces mounting defections, it’s Murray who will chair the Senate Budget Committee — commanding a majority she was instrumental in strengthening. And it’s Murray who is arguing that Democrats should use their leverage and call the Republicans’ bluff on the fiscal cliff without major compromise. Now who’s “serious”?
There’s something deeply satisfying about Murray taking, to paraphrase a recent Washington Post profile, all the crappy jobs no one else wanted and then kicking ass at them. That includes the Democratic Senatorial Campaign Committee, which she took over at a time when Democrats were supposedly going to lose the Senate. On her watch, no Democratic incumbent lost and a record number of women were elected. Along the way, she helped craft a key part of the winning message (which many of her colleagues overlooked at the time) — maintaining federal funding to Planned Parenthood. That was both a substantive and symbolic victory before “coming for your birth control” was even a thing.
Discussing the 2011 budget negotiations — in which defunding Planned Parenthood played an outsize role and the federal government was nearly shut down — Murray told the Post that “I walked in, and I was literally the only woman. And I walked in and they said: ‘We’re all done except the House wants one last concession. They want us to give on that and we’re done.’ And I said: ‘Not on my watch. Absolutely not on my watch.’”
That’s the sound of leadership, in this case, a female leader having the back of other women, just as Obama and fellow Democrats had Rice’s against empty and unfair attacks. This might be an unfamiliar sound to McCain, but if he and fellow Republicans keep it up, they’re right to be spooked.
By: Irin Carmon, Salon, November 26, 2012
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