“While The Rest Of The Country Suffers”: The Republican Congress Has Done Nothing But Help Big Business
On Thursday and Friday this week, House and Senate Republicans are at a joint retreat in Hershey, Pennsylvania, to listen to an array of speakers on different policy and political issues. This brief respite offers an opportunity to examine what the Republican priorities have been in the first 10 days of the 114th Congress, and it shows one clear winner: Big Business.
House Republicans began 2015 by immediately trying to roll back or delay a number of regulations in the Dodd-Frank regulatory reform law. Just a day into the new Congress, the House voted on a fast-track bill that would have watered down and rolled back a number of important regulations. In fact, the legislation, officially titled the Promoting Job Creation and Reducing Small Business Burdens Act, was the combination of 11 bills that would, among other things, delay the Volcker Act for years and weaken derivative regulations. The bill was brought up under suspension of the rules and thus required a two-thirds majority to pass. It fell short of that goal, with 276 legislators voting for it and 146 against. It was an unexpected victory for progressives after 44 Democrats changed their votes, after voting for a similar bill in the 113th Congress.
But Republicans were not to be denied. They brought up the bill under the normal rules where a two-thirds majority was not required. On Wednesday, it passed, 271-154. It’s not clear if the Senate would take it up, or if Democrats would have enough votes to filibuster it. But Wall Street received another gift in the Terrorism Risk Insurance Act, which expired at the end of 2014 and allows the federal government to backstop commercial insurance companies in the case of a terrorist attack. Even if you think terrorism risk insurance should be the government’s prerogative, it undoubtedly benefits large corporations, insurers, and real estate companies. Wall Street’s real victory, though, was the inclusion of a provision to roll back another, albeit smaller, component of Dodd-Frank. President Barack Obama signed it on Monday.
In other words, Wall Street is a fan of the new Republican Congress. Other industries are, too. Republicans have also focused on energy regulations, most notably approving the Keystone XL pipeline. Last Friday, the House passed a bill to approve the pipeline. The Senate voted to allow debate on the bill and will likely take a final vote on it next week, when it is expected to receive more than the 60 votes necessary to overcome a filibuster. The question is whether Congress has the two-thirds votes necessary to overturn Obama’s veto.
The House also took a whack at Obamacare by passing a bill that would change the definition of a full-time worker from 30 hours to 40 hours for purposes of the employer mandate. The Congressional Budget Office estimated that the bill would increase the deficit by $53.2 billion over the next decade, much of it from employers no longer having to pay a penalty for not offering health insurance for employees who work between 30-40 hours. The Senate is also readying a bill to repeal the medical device tax, which a new report this week estimated would cost 47-1,200 jobs, in total.
It wasn’t hard to predict that the new Republican Senate’s top priority would be helping Big Business. Partially, that’s because enough Democrats have been eager to support these bills and overcome filibusters in the Senate (such as on the Keystone pipeline or medical device tax). Utah Senator Mike Lee explained this in November in The Federalist:
[T]he easiest bipartisan measures to pass are almost always bills that directly benefit Big Business, and thus appeal to the corporatist establishments of both parties. In 2015, this “low-hanging fruit” we’ll hear about will be items like corporate tax reform, Obamacare’s medical device tax, patent reform, and perhaps the Keystone XL pipeline approval.
As it happens, these are all good ideas that I support. But if that’s as far as Republicans go, we will regret it. The GOP’s biggest branding problem is that Americans think we’re the party of Big Business and The Rich. If our “Show-We-Can-Govern” agenda can be fairly attacked as giving Big Business what it wants—while the rest of the country suffers—we will only reinforce that unpopular image.
Lee’s worries were prescient. The 114th Congress has only just begun, of course, so Republicans have plenty of time to put forward an agenda focused on the middle class. Senate Majority Leader Mitch McConnell could support other moderate Republicans in crafting a compromise to increase the minimum wage. The GOP could make an expansion of the Earned Income Tax Credit a priority. Lee and Florida Senator Marco Rubio have proposed a number of other policies that are focused on the middle class.
But right now, there are few signs that Republicans are going to do anything like that.
By: Danny Vinik, The New Republic, January 15, 2015
“Time For The GOP To Pitch In”: Passing Bills That Have No Chance Of Ever Becoming Law Is Not Best Advertisement For Effectiveness
With Republican majorities in both houses, the new Congress should begin by focusing on traditional GOP priorities: improving the nation’s sagging infrastructure, reforming an unwieldy tax code and finding ways to boost middle-class opportunity.
When pigs fly, you say? Skepticism is definitely in order. But Senate Majority Leader Mitch McConnell and House Speaker John Boehner have a fundamental choice to make. They can acknowledge the obvious areas of common ground they share with President Obama — thus showing that the Republican Party can participate responsibly in government — or they can throw temper tantrums.
McConnell told The Post that one of his goals, as he takes leadership of the Senate, is to avoid doing anything that would make it harder for the party to elect a president next year. “I don’t want the American people to think that, if they add a Republican president to a Republican Congress, that’s going to be a scary outcome,” he said.
The scariness of the GOP field probably will also depend on Ted Cruz’s apocalyptic rhetoric and Chris Christie’s progress in anger management. But McConnell is right that the whole “Party of No” routine, which he helped orchestrate, is unlikely to yield further political benefit — and may, at this point, inflict more damage on Republicans than on Democrats.
It is perhaps inevitable that the GOP will use its control of Congress to highlight the party’s pet issues — advocacy for the Keystone XL pipeline, for example, and opposition to the Affordable Care Act. Every once in a while, Republicans may even muster the needed 60 votes in the Senate — and force Obama to use his veto. But then what? Passing a bunch of bills that have no chance of ever becoming law is not the best advertisement for effectiveness.
McConnell told The Post he wants voters to see his party as a “responsible, right-of-center, governing majority.” Well, two obvious things such a majority should be doing right now are celebrating the economic recovery and looking for ways to ensure that more of its benefits reach the middle class.
Growth is accelerating, inflation is virtually nonexistent, stocks had a great year, unemployment is down and the U.S. economy is the envy of the developed world. That all of this has happened under the leadership of a Democratic president may be inconvenient for GOP leaders, but it’s the reality. Sourpuss grousing about how Obama is somehow “killing jobs” sounds ridiculous and out of touch. It seems to me that a “responsible” majority ought to be able to bring itself to say, “Nice job, Mr. President.” Even if it hurts.
Such a majority then should recognize that present economic conditions offer the opportunity to address big structural problems — and that addressing these problems can, in turn, broaden and deepen the recovery.
Infrastructure is perhaps the most obvious place to begin. Our airports are getting old. Many of our seaports cannot handle the newest generation of container ships. Thousands of our bridges need to be repaired or replaced. Century-old municipal water systems are breaking down. The electrical grid needs to be more robust and secure. And while we invented the Internet, citizens of other countries enjoy networks with faster speeds and lower costs.
Republicans used to agree with Democrats that good economic times offer the opportunity to invest in infrastructure — which creates jobs, both now and in the future. Deficits are falling rapidly and interest rates are at historic lows. What are we waiting for? Shouldn’t a “responsible” Congress have a bill on Obama’s desk by the end of the month?
Another subject on which Obama and the Republicans in Congress agree, at least in principle, is the need for corporate tax reform. Obama has acknowledged, and Republicans have long contended, that the current top corporate rate of nearly 40 percent is too high — and that the strategies corporations use to avoid paying those taxes, such as moving their headquarters overseas, are detrimental to the national interest. There is a larger debate to be had about overall tax policy, but couldn’t we just start by lowering the corporate rate and closing the loopholes?
Finally, a “responsible” party that’s prepared to govern would have some ideas about how to boost economic mobility, which is what we really mean when we talk about “opportunity.” If Republicans think the American Dream means the rich getting richer and the poor getting poorer, then no, they’re not remotely ready for prime time.
By: Eugene Robinson, Opinion Writer, The Washington Post, January 5, 2015
“An Enormously Difficult Task”: Why Republicans Will Lose The Coming Argument Over The Economy
There may be 21 months remaining between now and the 2016 presidential election, but both Republicans and Democrats have come to an agreement on what the election should be about. They may use different terms to describe it — Democrats will talk about “inequality,” while Republicans will tout “opportunity” — but they’re both going to focus on the ways the economy isn’t doing right by Americans who aren’t rich.
In the name of pundit courage, I offer a prediction: Republicans are going to lose the argument. They’ve practically lost it already.
Let’s take a look at what we’ve learned just in the past couple of days. We all know that both sides are looking for new policy ideas they can present that will demonstrate their commitment to lifting up middle class and poorer Americans, so what’s on offer? Chris Van Hollen, the ranking Democrat on the House Budget Committee, has released a plan that includes giving every working American who makes less than six figures a $1,000 tax credit, gives people further tax credits if they save money, limits corporate tax deductions for CEO compensation, and pays for it with a financial transactions tax (presented as a Wall Street “high roller” fee). Meanwhile, Republicans are trying to cut Social Security disability payments.
OK, so that’s not entirely fair — Republicans are, in fact, talking about what they can do for less affluent Americans. For instance, Politico reports today that even Mitt Romney has decided that the three pillars of his 2016 campaign will be a “muscular” foreign policy, helping the poor, and supporting the middle class. Which sounds interesting, but at this point it constitutes nothing more than talking about how this is an issue he’s going to be talking about. You have to look pretty hard to find an actual idea Republicans have.
And while they’re figuring that out, it looks like Democrats are going to keep rolling out one policy proposal after another, whether it’s Van Hollen’s tax credit (which other Democrats are also going to be advocating), President Obama’s plan to make community college free, or upcoming pushes on issues like paid family leave and more inclusive overtime rules.
Republicans start out at a significant disadvantage in this debate for a number of reasons. First, they tend to talk about the economy from a level far removed from that of ordinary people. Enact policies like low taxes and light regulation on corporations, they say, and the result will be growth that ends up benefiting everyone. But now they’re acknowledging that they have to talk about middle class and even poor people, and offer them something more specific. That runs into their second problem, that because they believe in small government, unlike Democrats they aren’t likely to support policies that offer direct, immediate benefits.
The policies they do support, furthermore, will immediately be characterized by their opponents as being one of two types: attacks on the poor being deceptively offered as efforts to help them (like devolving responsibility for safety net programs to the states) or moves to help rich people being deceptively offered as a boon to the middle class (like most Republican tax cuts).
Republicans will, of course, say that these criticisms are unfair. But the default assumption voters have is that the GOP is the party of the rich. That means that in order to persuade them, Republicans can’t just come up with some reasonable policy ideas, they have to offer something twice as compelling as what Democrats are proposing. And when Democrats are saying something straightforward, like “Our plan is to give you a thousand bucks and pay for it by taxing Wall Street,” while Republicans are trying to explain how block grants would bring a more efficient allocation of benefits, it isn’t hard to see who’s going to win the argument. Just try to imagine how much work someone like Mitt Romney — he of Bain Capital and the “47 percent” — is going to have to do to convince voters that he’s really the one who’s on the side of the middle class.
If we look back at the recent history of presidential campaigns, we see that Republicans win the argument on the economy under three conditions. The first is when there’s a Democrat in the White House and the economy is terrible, as it was in 1980. The second is when there’s a Republican in the White House and the economy is doing well, as it was in 1984 or 1988. And the third is when the economy is doing so-so, but the election turns on an entirely different set of issues, as in 2004 — in other words, when there really isn’t much of a discussion on the economy.
The 2016 election doesn’t look (at the moment anyway) like any of those three. Unless there’s a dramatic change, the economy will be doing well in broad terms like growth and job creation, but voters will want to hear what the parties are going to propose to improve wages, working conditions, and the fortunes of the middle class and those struggling to join it. Winning that argument will be an enormously difficult task for the GOP, and they aren’t off to a promising start.
By: Paul Waldman, Senior Writer, The American Prospect; Contributor, The Plum Line, The Washington Post, January 13, 2015
“We’re No. 1!”: How Government Helps The 1 Percent
You may think that government takes a lot of money from the wealthy and gives it to poor people. You might also assume that the rich pay a lot to support government while the poor pay a pittance.
There is nothing wrong with you if you believe this. Our public discourse is dominated by these ideas, and you’d probably feel foolish challenging them. After Mitt Romney’s comments on the 47 percent blew up on him, conservatives have largely given up talking publicly about their “makers versus takers” distinction. But much of the right’s rhetoric and many of its policies are still based on such notions.
It is thus a public service that the Institute on Taxation and Economic Policy (ITEP) has issued a report showing that at the state and local level, government is, indeed, engaged in redistribution — but it’s redistribution from the poor and the middle class to the wealthy.
It’s entirely true that better-off people pay more in federal income taxes than the less well-to-do. But this leaves out not only Social Security taxes, but also what’s going on elsewhere.
The institute found that in 2015, the poorest fifth of Americans will pay, on average, 10.9 percent of their incomes in state and local taxes and the middle fifth will pay 9.4 percent. But the top 1 percent will pay states and localities only 5.4 percent of their incomes in taxes.
When you think about it, such figures should not come as a surprise. Most state and local governments rely on regressive taxes — particularly sales and excise levies. Poor and middle-class people pay more simply because they have to spend the bulk of their incomes just to cover their costs.
This gets to something else we don’t discuss much: Public policies in most other well-to-do countries push much harder against inequality than ours do. According to the Luxembourg Income Study (LIS), the United States ranks 10th in income inequality before taxes and government transfers. By this measure, Ireland and Britain, and even Sweden and Norway, are more unequal than we are. But after government transfers are taken into account, the good old USA soars to first in inequality. Norway drops to 6th place and Sweden to 13th.
It’s not a matter about which we should be proud to shout, “We’re No. 1!”
Actually, things may be a bit worse for us even on pre-transfer incomes, said LIS Director Janet Gornick, because people in the other rich countries tend to draw their pensions earlier.
The overall story is that we are not very aggressive, with apologies to Joe the Plumber, in spreading the wealth around. “Our inequality is already high because of the low minimum wage, the weakness of unions and very high levels of private-sector compensation at the top,” Gornick, a professor at the Graduate Center of the City University of New York, said in a telephone interview from Luxembourg. “But on top of that, we are redistributing less than other countries and also have lower taxes on the highest incomes, particularly income from capital.”
And at the state and local levels, our governments are exacerbating inequality. The ITEP study concludes that “every single state and local tax system is regressive and even the states that do better than others have much room for improvement.” The five states with the most regressive systems are Washington, Florida, Texas, South Dakota and Illinois.
On its face, the property tax would seem progressive, because big houses are taxed more. But the study finds that on average, “poor homeowners and renters pay more of their incomes in property taxes than do any other income group — and the wealthiest taxpayers pay the least.”
There is also an unanticipated consequence of growing economic disparities: Because states and localities tax the wealthy less, “rising income inequality can make it more difficult for state tax systems to pay for needed services over time. The more income that goes to the wealthy, the slower a state’s revenue grows.”
Political debates are typically driven by clichés , but at the very least, we can expect our clichés to be true. We need to stop claiming that we have a massively redistributive government. We need to stop pretending that poor people are “takers” when they in fact kick in a lot to the common pot. And we need to replace arguments about “big” and “small” government with a debate over what governments at all levels are doing to make our society more just — or less.
By: E. J. Dionne, Jr., Opinion Writer, The Washington Post, January 15, 2015
“Populism Is As Much A Problem As Plutocracy”: Mike Huckabee Is Not The Cure For What Ails The GOP
It’s become conventional wisdom among a certain segment of political pundits and conservative intellectuals — especially the so-called Reformicons — that the GOP has a plutocracy problem. Too many high-end tax cuts, too much indifference to the struggles of working-class voters, too many denunciations of the mooching ways of the American people — all of it adds up to a party that looks out of touch and overly beholden to the concerns of wealthy donors at the expense of everyone else.
The solution, supposedly, is populism — Republican candidates who can speak the language and understand the problems of ordinary voters.
Until recently, no one fixing to run for the White House in 2016 looked likely to do so as a populist. But that may have changed over this past weekend, when Mike Huckabee quit his television show on Fox News as a possible first step toward throwing his hat into the ring.
You’d think that the prospect of a Huckabee candidacy would cause the party’s populists to swoon. After all, Huckabee is a folksy Southern evangelical Christian, a bass-playing two-term governor, and an ordained Southern Baptist minister who won eight states (including Iowa) the last time he ran for president in 2008. And that was before he raised his profile with a nationally syndicated radio program and a TV show on the right’s premier cable channel.
And yet the Huckabee news this past Saturday produced the opposite of excitement. Mainstream conservatives mocked the prospect of his candidacy on Twitter, while reformers who’ve been pining for a populist have been muted.
The question is why.
And the answer, I think, is that on some level smart Republicans understand that populism is as much a problem for the party as plutocracy.
Yes, Mitt Romney’s tendency to toady to superrich donors and entrepreneurs — coming on the heels of George W. Bush’s high-end tax cuts — certainly saddled the GOP with a plutocratic image problem. But what about its tendency to flatter culturally alienated middle-class Americans by dismissing evolutionary biology, by mocking professors and “experts” of all kinds, and by pandering to the prejudices of a certain kind of ill-informed, reactionary religious believer?
The fact is that the Republican Party has long since become a bizarre only-in-America hybrid of fat cats and rednecks.
Deep down Republicans know that while a Huckabee candidacy might help address the image problems associated with the first half of that equation, he’d make those wrapped up with the second half far worse.
Consider some of Huckabee’s public statements in recent years:
Praising the work of a hack historian lionized by Know Nothing evangelicals, Huckabee declared in 2011, “I almost wish that…all Americans would be forced, at gunpoint, to listen to every David Barton message.” (Thank goodness for that “almost”!)
Responding to the Sandy Hook school massacre of 2012, Huckabee suggested that schools had become “place[s] of carnage” because “we have systematically removed God from our schools.”
Last winter, Huckabee stated in a speech (not unscripted remarks) that “if the Democrats want to insult the women of America by making them believe that they are helpless without Uncle Sugar coming in and providing for them a prescription each month for birth control because they cannot control their libido or their reproductive system without the help of the government, then so be it.”
Huckabee’s latest book, slated to appear on Jan. 20, is titled God, Guns, Grits, and Gravy.
That, my friends, is what right-wing American populism sounds like in the second decade of the 21st century. It is the irritable mental gesture of a provincial (rural or exurban) white America that can’t tell the difference between cultural signaling and a cogent argument. And it treats the details of public policy as an afterthought or a matter of indifference.
Would-be Republican reformers can look for a better vehicle than Mike Huckabee for the populism they favor, but they’re unlikely to find one. Huckabee — or someone like him — is the only game in town.
The authentic reform of the GOP — its refashioning into a genuinely national party — requires more than the shedding of its plutocratic image. It also requires that the party’s leading lights give up on their impossible populist dreams.
By: Damon Linker, The Week, January 6, 2014
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