“The Forgotten Millions”: Spending More To Create Jobs Now Would Actually Improve Our Long-Run Fiscal Position
Let’s get one thing straight: America is not facing a fiscal crisis. It is, however, still very much experiencing a job crisis.
It’s easy to get confused about the fiscal thing, since everyone’s talking about the “fiscal cliff.” Indeed, one recent poll suggests that a large plurality of the public believes that the budget deficit will go up if we go off that cliff.
In fact, of course, it’s just the opposite: The danger is that the deficit will come down too much, too fast. And the reasons that might happen are purely political; we may be about to slash spending and raise taxes not because markets demand it, but because Republicans have been using blackmail as a bargaining strategy, and the president seems ready to call their bluff.
Moreover, despite years of warnings from the usual suspects about the dangers of deficits and debt, our government can borrow at incredibly low interest rates — interest rates on inflation-protected U.S. bonds are actually negative, so investors are paying our government to make use of their money. And don’t tell me that markets may suddenly turn on us. Remember, the U.S. government can’t run out of cash (it prints the stuff), so the worst that could happen would be a fall in the dollar, which wouldn’t be a terrible thing and might actually help the economy.
Yet there is a whole industry built around the promotion of deficit panic. Lavishly funded corporate groups keep hyping the danger of government debt and the urgency of deficit reduction now now now — except that these same groups are suddenly warning against too much deficit reduction. No wonder the public is confused.
Meanwhile, there is almost no organized pressure to deal with the terrible thing that is actually happening right now — namely, mass unemployment. Yes, we’ve made progress over the past year. But long-term unemployment remains at levels not seen since the Great Depression: as of October, 4.9 million Americans had been unemployed for more than six months, and 3.6 million had been out of work for more than a year.
When you see numbers like those, bear in mind that we’re looking at millions of human tragedies: at individuals and families whose lives are falling apart because they can’t find work, at savings consumed, homes lost and dreams destroyed. And the longer this goes on, the bigger the tragedy.
There are also huge dollars-and-cents costs to our unmet jobs crisis. When willing workers endure forced idleness society as a whole suffers from the waste of their efforts and talents. The Congressional Budget Office estimates that what we are actually producing falls short of what we could and should be producing by around 6 percent of G.D.P., or $900 billion a year.
Worse yet, there are good reasons to believe that high unemployment is undermining our future growth as well, as the long-term unemployed come to be considered unemployable, as investment falters in the face of inadequate sales.
So what can be done? The panic over the fiscal cliff has been revelatory. It shows that even the deficit scolds are closet Keynesians. That is, they believe that right now spending cuts and tax hikes would destroy jobs; it’s impossible to make that claim while denying that temporary spending increases and tax cuts would create jobs. Yes, our still-depressed economy needs more fiscal stimulus.
And, to his credit, President Obama did include a modest amount of stimulus in his initial budget offer; the White House, at least, hasn’t completely forgotten about the unemployed. Unfortunately, almost nobody expects those stimulus plans to be included in whatever deal is eventually reached.
So why aren’t we helping the unemployed? It’s not because we can’t afford it. Given those ultralow borrowing costs, plus the damage unemployment is doing to our economy and hence to the tax base, you can make a pretty good case that spending more to create jobs now would actually improve our long-run fiscal position.
Nor, I think, is it really ideology. Even Republicans, when opposing cuts in defense spending, immediately start talking about how such cuts would destroy jobs — and I’m sorry, but weaponized Keynesianism, the assertion that government spending creates jobs, but only if it goes to the military, doesn’t make sense.
No, in the end it’s hard to avoid concluding that it’s about class. Influential people in Washington aren’t worried about losing their jobs; by and large they don’t even know anyone who’s unemployed. The plight of the unemployed simply doesn’t loom large in their minds — and, of course, the unemployed don’t hire lobbyists or make big campaign contributions.
So the unemployment crisis goes on and on, even though we have both the knowledge and the means to solve it. It’s a vast tragedy — and it’s also an outrage.
By: Paul Krugman, Op-Ed Columnist, The New York Times, December 6, 2012
“Leading From Behind”: Could John Boehner Lose The House Speaker’s Gavel?
Think Congress is dysfunctional during these fiscal-cliff negotiations? What if John Boehner can’t even get enough House Republican votes next month to be reelected as speaker?
Far-fetched? Perhaps. But at least one conservative group says Boehner’s hold on the speaker’s gavel should not be viewed as a done deal. It is launching an all-out effort aimed at about 100 House Republicans to see if it can find at least 17 of them angry enough, and bold enough, to block Boehner’s reelection when the new Congress commences on Jan. 3.
“With Boehner basically out there promoting a tax hike and removing conservatives from key committees, these are not good precedents for the next two years,” Ned Ryun, whose father, Jim Ryun, was a representative for Kansas, complained to the National Journal on Thursday.
Ned Ryun is president and CEO of American Majority, a Virginia-based group that says it has trained thousands of conservative activists and also says that it embraces but predates the Tea Party movement. He is getting attention with a blog he posted on Wednesday — not so much because he says Boehner should be fired as speaker, but because he says the conservative movement could actually accomplish that goal under House rules and that it does not have to be a “fairy-tale” wish.
Boehner, whose last two years as speaker already have been mired in grousing from conservative groups, is again being hit this week from the far right over his counteroffer in fiscal-cliff negotiations with the White House to raise $800 billion in revenue by closing special-interest loopholes and tax deductions. Some groups are casting this as his seeming openness to breaking a promise not to raise taxes.
Adding to that anger has been other news this week that the speaker and his House GOP steering committee had purged four conservatives from their coveted committee seats, at least three of whom have been butting heads with party leaders over government spending and the federal deficit. This just weeks after Boehner had pleaded for unity in a private conference call to fellow House Republicans on the day after the Nov. 6 election.
For this anger to result in Boehner losing his speaker’s gavel, explained Ryun to National Journal on Thursday, enough conservative members need to show “some guts” and publicly rebel.
He says his group is looking at a list of about 100 conservatives whom they will try to persuade to step up, go public with their disappointment in Boehner, and show they are willing to take the risks and potential punishment Boehner has already shown he will dish out if such an effort fails.
In fact, there was already some murmuring within the House Republican conference itself about potential maneuvering in the upcoming speaker election as a way to express conservative discontent, say House GOP sources familiar with such talks.
But each of those who spoke — all on the condition they not be identified — also underscored that they’ve seen no concerted effort yet to organize anything beyond some conservatives saying they might simply vote “present” instead of specifically for Boehner. Even doing that would bring potential punishment from top leaders, because the votes are public.
Boehner spokesman Michael Steel responded on Thursday by pointing out that the Ohio Republican last month “was honored to be selected by the House Republican Conference to be its candidate for speaker.” In fact, there was only one other candidate nominated in that closed-door process. And the nomination by Rep. Louie Gohmert, R-Texas, of former Speaker Newt Gingrich did not even receive a seconding. But there was no actual roll-call vote, and Boehner was selected by acclamation.
For their part, House Democrats reelected Nancy Pelosi as their leader, and also their nominee to be speaker.
Under normal circumstances, Boehner’s reelection as speaker on Jan. 3 should be automatic. House Republicans are set to enter the new Congress holding 234 seats and the Democrats will have 200 seats (one of the House’s total 435 seats is to be vacant with the resignation last month of former Rep. Jesse Jackson Jr. of Illinois). But the linchpin of the conservative “oust-Boehner” strategy being floated rests on the requirement that to be elected as speaker, a candidate must receive an “absolute majority” of all House member votes cast for individuals.
And as confirmed in the details contained in a Congressional Research Service analysis dated Jan. 6, 2011, titled, “Speakers of the House: Elections, 1913-2011,” a concerted effort by as few as 17 House conservatives could — in fact — throw this normally routine reelection process for Boehner into turmoil.
“Members normally vote for the (speaker) candidate of their own party conference, but may vote for any individual, whether nominated or not,” states the CRS report. “To be elected, a candidate must receive an absolute majority of all the votes cast for individuals. This number may be less than a majority (now 218) of the full membership of the House, because of vacancies, absentees, or members voting “present.”
In short, with Jackson having retired, as few as 17 House Republican members now can deny Boehner an “absolute majority” of the total 434 expected votes on Jan. 3, if all the Democrats back Pelosi.
The CRS report goes on to note that the elected speaker has always been a sitting member of the House, but the Constitution does not require that to be so. As a result, Republicans upset with Boehner aren’t limited to voting for Pelosi, or even another Republican, but almost anyone as a symbolic alternative.
“If no candidate receives the requisite majority, the roll call is repeated until a Speaker is elected.
Since 1913, this procedure has been necessary only in 1923, when nine ballots were required before a speaker was elected, states the report.
On Thursday, one House Republican member, who described himself during the interview as a conservative, said he has not been approached by any colleagues about such a maneuver but has heard discussion about it from other sources. He insisted he would not go along with such a ploy — but he also said that if Boehner were to not be elected on the first ballot, it would be tantamount to a “no confidence vote.” He said that would likely lead to some energetic closed-door conferences to iron out differences, “or even pick a new leader.”
This lawmaker said that in such a scenario, he did not believe either Majority Leader Eric Cantor nor Majority Whip Kevin Smith would be selected by the conference as its new nominee — “because they are all functioning as one team.”
Meanwhile, a senior House Democratic aide appeared to relish such talk, saying it indicates Boehner’s leadership team “is going to have to work their butts off and call in every chit to make sure he wins what should normally be just a boring vote.”
“If Speaker Boehner wants to purge independent, bold conservatives — I think it’s time he gets fired as speaker,” blogged Ryun. “Not only for the purge. He has failed to effectively win negotiations with President Obama and appointed moderate committee chairs. To the public, Boehner may appear radical, but in reality he proposes milquetoast policies, like the tax hikes he proposed this week.”
By: Billy House, The Atlantic, December 6, 2012
“A Very Dysfunctional Party”: GOP Needs To Choose Between The Business Community And The Tea Party
How long will the major GOP-aligned interest groups, particularly business groups, stick with the Republican Party, if Republican tax monomania, and intransigence on the debt ceiling, threaten to tank the economy?
Barack Obama, in his interview today with Bloomberg, tried to exploit the business community’s apparent discomfort with Republicans when it comes to the debt limit. He noted that Republican efforts to crash the economy every time it is reached is hardly good for business:
Another thing that CEOs have mentioned is making sure that if we do get a deal done now, that we don’t have another crisis two or three months from now because of the debt ceiling, what we went through back in 2011. You know, the U.S. Chamber of Commerce, which is hardly an arm of my administration or the Democratic Party, I think said the other day, we can’t be going through another debt ceiling crisis like we did in 2011. That has to be dealt with.
Indeed, there really is a question here about the extent to which businesses will follow the GOP down the rabbit hole of another debt limit crisis.
Recall that in the health care debate, Republicans wound up losing several GOP-aligned special interests, including the doctors, because Republicans were far more interested in ideological extremism than in cutting deals to help Republican-aligned interest groups.
Will that happen again in the fiscal cliff negotiations? Note that many business interests are not nearly as interested in the tax-rates-above-all Republican negotiating position as they are in, well, avoiding a recession. It’s not as if the business community is going to suddenly turn into loyal Democrats. It’s just that the more the Republican Party’s positions are dictated by fear of being labeled “RINOs,” forcing them to adopt Tea Party positions, the less Republicans leaders will find themselves responsive to other normally GOP-aligned groups.
That’s a key question to look at not only in the continuing fiscal cliff talks, but really in every issue, from taxes to immigration, that will show up in Congress this year. Republicans simply can’t be a functional party if their politicians only care about possible primary challenges. Before this is all over, the Republican Party may finally have to make a critical choice between the pragmatic concerns of the business community and the fundamentalism of the Tea Party.
By: Jonathan Bernstein, The Washington Post Plum Line, December 4, 2012
“So Many Hard Decisions”: House Republicans Eye Violence Against Women Act Changes
Among Congress’ many other looming deadlines, the Violence Against Women Act is still waiting for reauthorization. It easily passed the Senate with bipartisan support in April, but House Republicans insist the current version is too supportive of immigrants, the LGBT community, and Native Americans.
Is there any chance policymakers can work something out? One of the original VAWA authors from 1994 is now the nation’s vice president, and he’s working behind the scenes to work out a deal.
Vice President Joe Biden is quietly working with House Majority Leader Eric Cantor (R-Va.) to try to pass an inclusive version of the Violence Against Women Act in the lame-duck Congress. And so far, sources tell HuffPost, Cantor is on board as long as one thing is stripped from the bill: a key protection for Native American women.
Staffers for Biden and Cantor have been trying to reach a deal on the bill for at least a week. Neither camp publicly let on it was talking to the other until Wednesday, when Cantor said the two are in negotiations and he’s feeling hopeful about a deal.
For nearly two decades, VAWA reauthorization was effortless — even the most far-right members didn’t want to be seen opposing resources for state and local governments to combat domestic violence. But as Republicans move further and further to the right, congressional support for the law has grown difficult in ways few could have imagined.
In this case, Cantor is willing to bend on LGBT and immigrant provisions, but he wants Democrats to scrap protections for Native American women. According to the Huffington Post, the Democratic provision gives tribal courts limited jurisdiction to oversee domestic violence offenses committed against Native American women by non-Native American men on tribal lands, and the House Republican leader wants this expansion curtailed.
We’ll know soon enough whether an agreement is possible in the limited time remaining, but in the meantime, GOP officials should probably hope Dana Perino isn’t the leading conservative voice when it comes to domestic violence.
Indeed, it’s astonishing that a Republican media figure would say this out loud on national television.
Appearing on Fox News Wednesday evening, Dana Perino suggested female victims of violence should “make better decisions” in order to escape harm.
Media Matters has the video.
By: Steve Benen, The Maddow Blog, December 7, 2012
“Racing To the Bottom In Michigan”: And A Fine “Happy Holidays” To Michigan Workers Too
It won’t be formal until next Tuesday (thanks to a five-day delay requirement for bills passed by both Houses), but the Michigan legislature has indeed approved “right-to-work” legislation in a lame-duck session blitzkrieg of enormous audacity. There were no hearings, no public debate, and virtually no warning before the famously pro-labor state joined the Greater South in declaring itself union-unfriendly territory, as Gov. Rick Snyder abruptly reversed his prior opposition to consideration of such legislation. That very day the hammer came down in a series of votes.
One of the right-to-work bills (the one affecting public-sector workers) passed the Michigan House by a 58-52 margin, just one vote below the number of Republicans who will serve in the next session. This reinforces the impression that GOpers feared they wouldn’t have to votes to enact right-to-work had they utilized the normal legislative process and waited until representatives elected on November 6 were in place.
The panic-stricken nature of the GOP coup wasn’t much reflected in the bland and empty public rationales offered for it by Snyder:
In an interview with The Associated Press, Snyder said he had kept the issue at arm’s length while pursuing other programs to bolster the state economy. But he said circumstances had pushed the matter to the forefront.
“It is a divisive issue,” he acknowledged. “But it was already being divisive over the past few weeks, so let’s get this resolved. Let’s reach a conclusion that’s in the best interests of all.”
Also influencing his decision, he said, were reports that some 90 companies had decided to locate in Indiana since that state adopted right-to-work legislation. “That’s thousands of jobs, and we want to have that kind of success in Michigan,” he said.
OMG, Indiana’s screwing its workers, so Michigan has to do the same right now! This is very literally a “race to the bottom” if ever there has been one.
Because Republican legislators shrewdly attached an appropriation to the bill, it will not be subject to reversal by initiative. Looks like November 2014 will be the first opportunity for some accountability, when the entire legislature is up for re-election, along with Snyder.
The Michigan Senate’s Democratic Leader, Gretchen Whitmer, had a tart description of the entire manuever:
“These guys have lied to us all along the way,” she said. “They are pushing through the most divisive legislation they could come up with in the dark of night, at the end of a lame-duck session and then they’re going to hightail it out of town. It’s cowardly.”
And a fine “happy holidays” to Michigan workers, too.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, December 7, 2012
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