“Nobody Is Falling For This”: House Republicans Make Their Regularly Scheduled Threat To Destroy The Global Economy
House Republicans will huddle at their annual retreat next week to decide what will they demand in exchange for raising the debt ceiling.
If the limit on how much the government can borrow to pay off debts Congress has already voted to incur is not raised by late February, the U.S. will default purposely for the first time in American history, triggering a financial crisis that many experts feel would be at least as devastating as the economic meltdown of 2008, which put millions out of work and destroyed trillions in wealth.
The government shutdown in October dominated the discussion during the weeks leading up to the last debt limit crisis. Republicans released a comical list of demands. The White House offered nothing, and that’s essentially what Republicans accepted when they folded on the government shutdown.
Earlier in 2013, Republicans demanded that the Senate pass a budget in exchange for raising the debt limit. The Senate agreed and House Republicans followed the strategy of Senator Ted Cruz (R-TX) and refused to go into conference with Democrats in the upper house — 18 times. And that’s how we got the shutdown.
Of course, you only have to feed a stray once to keep it scratching at the door. In 2011, House Republicans successfully used the debt limit to extract the automatic cuts known as the sequester, while triggering a near-panic that erased some 1,200 points from the Dow. Because the House has folded twice since then, Wall Street now takes the GOP’s threats as seriously as a Sarah Palin presidential bid, even when America was just hours from a default in October.
House Speaker John Boehner (R-OH) seems to have taken the reins of his caucus after the shutdown disaster and has since passed a two-year budget with little drama over the objections of the outside groups that backed Cruz last year. But the man who negotiated that deal — Rep. Paul Ryan (R-WI) — was one of the driving forces behind the 2011 crisis and is saying the House will demand something in exchange for raising the debt limit. The chairman of the Budget Committee has keyed in on the so-called “Obamacare Bailout,” which not a bailout at all, but a complex set of mostly deficit-neutral mechanisms that could help insurers if they are forced to take on too many sick customers, or could help cut the deficit if they don’t.
The problem for the GOP is the same mechanism exists in Medicare Part D, which was signed into law by George W. Bush and passed by Republicans — including Paul Ryan.
Still, Republicans plan to dare the president to default “to preserve a massive bailout for insurance companies” knowing that what they’re saying is “one enormous lie.”
Will Republicans give in when they recognize that the president will not cave to their demands, as he has vowed not to over and over again?
New York magazine’s Jonathan Chait believes they will.
Chait — who called the last debt ceiling standoff a domestic “Cuban Missile Crisis,” which the president won — notes that the House GOP’s argument has devolved from sanctimonious prattle about the debt to a straight-up demand for scattershot “concessions,” which only makes sense if they want to destroy the economy and need some incentive not to do so.
“But you can only try this bluff once,” Chait wrote. “The only way it could still work would be if Obama either paid a ransom or Republicans shot the hostage. Once the mark knows you’re bluffing, it’s over. You can’t do it again. Nobody is falling for this.”
The GOP’s debt scaremongering made a little sense in 2010 when the deficit was over $1 trillion and the long-term debt projections were skyrocketing — though threatening default increased the deficit and an actual default would have exploded it astronomically. But the deficit has been cut in half, mostly thanks to the end of some of the Bush tax breaks for the rich, and any threat of a long-term debt “crisis” may be disappearing, thanks to Obamacare.
Now the GOP’s theatrics just play into the notion that they blind obstructionists. And if they go too far, they could actually blow the 2014 elections.
Speaker Boehner needs his bluff to be taken seriously by only one constituency — a majority of his caucus.
The 50-70 members of the “suicide caucus” who are more aligned with outside conservative groups than the Speaker are already furious about the budget deal. They’re plotting a rebellion over piecemeal immigration reform that Boehner is preparing to take up, and they’re even planning on joining a retreat organized by Heritage Action that will immediately follow the one being held by leadership.
Boehner has to appear that he’s willing to default up until the exact moment when the pressure from the business community forces him to cave. And hopefully then there will be enough Republicans behind him when he does, so he can prevent a needless catastrophe at the last possible moment.
By: Jason Sattler, The National Memo, January 24, 2014
“Media Fantasy Becoming Completely Undone”: GOP’s “Deep Bench” For 2016 Is Now In Splinters
Last time I saw former Virginia Gov. Bob McDonnell, he was sashaying around Tampa, Fla., in 2012 as though we’d see him again, big time, in 2016. Elected with Chris Christie in that 2009 statehouse rebuke to President Obama, he’d been a rising star, tapped to make the 2010 GOP State of the Union reply and an opening night convention address in Tampa. He made sure to shake my hand as I replaced him in the shared CNBC/MSNBC makeup cubby off the convention floor. Good times. Now McDonnell’s only thoughts of 2016 are making sure he doesn’t spend it in prison, as he fights public corruption charges for taking an estimated $165,000 in gifts from a grifting donor.
Meanwhile his class of 2009 buddy Chris Christie looks at McDonnell and has to worry: the wheels of justice turn slowly, but they turn, and they are inexorably turning now for Christie – lots of them. Between the genuine George Washington Bridge retribution scandal involving his closest aides, and newer charges that his lieutenant governor threatened to use Sandy aid as payback if Hoboken’s mayor blocked a Christie donor’s development deal, the New Jersey governor is vulnerable on more fronts than McDonnell ever was, though to be fair, investigators aren’t in Christie’s kitchen – not yet, anyway.
So concern-troll Hillary Clinton all you want, Beltway pundits. You’re missing the only 2016 story that matters, and not surprisingly, it involves a lot of you. The mainstream media fantasy of a remarkably “deep bench” of 2016 contenders for the GOP was never founded in reality – but such a bench, if it ever existed, is surely in splinters today.
That “deep bench” metaphor, by the way, seems to have come directly from Mitt Romney’s V.P. vetter Beth Myers, although you had to ask, then and now: if the GOP bench was so deep, how did they wind up with Paul Ryan, who couldn’t even carry his home state of Wisconsin? (More on Ryan in a moment.)
But for now, let’s revisit that bench: It’s not just McDonnell (No. 3 on the National Journal’s 2012 “deep bench” list for 2016) and Christie (he was No. 1) who are finished. No. 2 contender Sen. Marco Rubio is, too: He made a play for the center with immigration reform, panicked and tacked right, and now he’s nobody’s top choice. Louisiana Gov. Bobby Jindal (lucky No. 7!) flamed out after telling the GOP to stop being “the stupid party,” then acting, well, stupidly, and becoming, by August of 2013, the most unpopular Republican governor in the country (and that’s saying a lot).
Texas Sen. Ted Cruz isn’t even on the list, but he deserves some attention. He came out of nowhere in 2012, but he’s already imploded spectacularly, going from a top-tier contender in early polls to far behind because of his self-promoting and nasty (not to mention extremist) brand of politics.
Sen. Rand Paul made many lists (the National Journal’s No. 6), and he still has a few admirers, especially among his father’s old fans. But Paul has proven to be a lightweight with a plagiarism problem whose one somewhat interesting attribute – his national security and foreign policy skepticism — is politically suicidal with the GOP (and most of the Democratic) establishment. He will not be the GOP nominee.
Then there’s Rep. Paul Ryan, last seen reinventing himself as a friend of the poor and a fan of Pope Francis (even if he couldn’t resist lecturing the pope for his faulty knowledge of capitalism). He plays a wonk on TV, but badly; his only contribution to the 2012 ticket was to hurt Romney. While the National Journal had Ryan at No. 5, no defeated V.P. candidate has ever become president except FDR, and no number of loving McKay Coppins profiles will ever make Paul Ryan FDR.
While we’re in Wisconsin, let’s look at Gov. Scott Walker, who’s getting a little play now that Christie is tumbling. Walker is a charisma-free Koch brothers toady who has more in common with Christie than alleged statehouse pragmatism: his own ethically challenged aides, back in Milwaukee. Three Walker associates were convicted in an earlier probe into campaign finance violations; last October, a new investigation began. Walker was named one of the nation’s “worst governors” by the Citizens for Responsibility and Ethics in Washington. He is not ready for the glare of a national campaign.
That leaves Jeb Bush (National Journal’s No. 4*). He and his brother are disliked by the Tea Party, but the former Florida governor is beloved by the GOP establishment; he could be said to embody it. But is the country ready for another Bush? His own mother says no, and his wife, Columba, is also said to be against it. And as long as pundits insist Hillary Clinton’s ties with Wall Street could hurt her in this populist era – and they could – Bush’s will do the same thing, because they’re even closer. He went to work for doomed Lehman Brothers after leaving the governor’s mansion, because apparently Bushes aren’t wealthy enough.
Then, sadly, Florida’s state and local pension funds lost $1 billion when the firm went bankrupt. Bush came in for blame, since he was also on the State Board of Administration, which invests public funds, but he insists he played no role in advising public fund administrators to use Lehman. Still, the potential conflict would get new oxygen from a national race.
So let Larry Sabato and Ron Fournier concern-troll Hillary Clinton. It’s true, she may not run, and if she runs, she may not win. But if you want to be president in 2016 — man or woman, black or white, Republican or Democrat — you’d rather be Hillary Clinton than anyone else in the world.
Especially anyone on that shattered GOP bench.
* Just in case you’re curious, South Carolina Gov. Nikki Haley, South Dakota Sen. John Thune and Indiana Rep. Mike Pence rounded out the National Journal list.
By: Joan Walsh, Editor at Large, Salon, January 24, 2014
“Isolated From The Rest Of The Public”: The Tea Party And The Hammock Theory Of Poverty
The increased focus on inequality has shifted the conversation away from deficit/austerity mania and towards a discussion of what government should be doing to boost the economy and protect people from economic harm. And it’s also prompted good new polling that goes deep into public views of the economy, the safety net, inequality, and what government should do about it.
On these topics, this week brought two new polls from Pew Research and CBS News.
I’ve asked both firms for a detailed breakdown of their data, and here’s a striking finding: The ideas and assumptions underlying the GOP economic and poverty agenda are far and away more reflective of the preoccupations of Tea Party Republicans. Meanwhile, non-Tea Party Republicans are much more in line with the rest of the public on these matters.
In short, the Tea Party economic worldview, if such a thing exists, is isolated from the rest of the public, and even to some degree from non-Tea Party Republicans – yet it has an outsized role in shaping the GOP’s overall agenda.
Both the Pew and CBS polls find large majorities believe the income gap is growing, and both find that more Americans want government to do something about it. Both also find solid majority support for raising the minimum wage, extending unemployment benefits, and (in Pew’s case) taxing the rich to help the poor.
Both polls also find that far larger numbers of Republicans don’t think government should act to reduce inequality. This is reflected in the GOP economic agenda. As Jonathan Chait explains, this agenda continues to be premised on the ideas that there is, if anything, too much downward redistribution of wealth, that government shouldn’t interfere in the market by, say, raising the minimum wage, and that safety net programs lull people into dependency (Paul Ryan’s Hammock Theory of Poverty).
But here’s the thing. That basic set of assumptions — and the resulting positions on some of the individual policies being discussed – are held overwhelmingly by Tea Party Republicans; and not nearly as much by non-tea party Republicans. Key findings:
On government action to combat inequality:
* The Pew poll finds Republicans divided on whether government should do a lot or some to reduce inequality, versus doing little or nothing, by 49-46. But tea party Republicans overwhelmingly tilt against government doing something by 66-28, while non-tea party Republicans overwhelmingly favor doing something by 60-35.
* The CBS poll is less pronounced, but even here, Tea Party Republicans overwhelmingly oppose government acting to reduce the gap between rich and poor by 82-17, while non-Tea Party Republicans believe this by 66-29 (so nearly a third of non-Tea party Republicans believe it).
On unemployment benefits:
* The Pew poll finds Republicans oppose extending unemployment benefits by 53-44. But Tea Party Republicans overwhelmingly oppose this by 70-29, while non-Tea Party Republicans support it by 52-44.
* Similarly, the CBS poll finds that Republicans oppose extending unemployment benefits by 49-40. But Tea Party Republicans overwhelmingly oppose it by 58-31. Non-Tea Party Republicans favor extending them by 46-43.
On the Hammock Theory of Poverty:
* The CBS poll finds that Republicans believe unemployment benefits make people less motivated to look for a job by 57-40. But Tea Party Republicans overwhelmingly believe this by 67-32. By contrast, only a minority of non-tea party Republicans believe this (47-51).
* The Pew poll has a similar finding: Republicans believe government aid to the poor does more harm than good by making people dependent on government, rather than doing more good than harm, by 67-27. But Tea Party Republicans overwhelmingly believe this by 84-11, while non-tea party Republicans are somewhat more closely divided, 59-35.
On the minimum wage:
* The Pew poll finds that Republicans favor raising the minimum wage to $10.10 an hour by 54-44. But Tea Party Republicans overwhelmingly oppose this by 65-33. Non-Tea Party Republicans overwhelmingly support it by 65-33. (All the above Pew numbers include Republicans and GOP-leaners).
* The CBS poll is less pronounced, but even here, Tea Party Republicans tilt against a minimum wage hike by 52-47, while non-tea party Republicans favor it by 50-48.
A number of conservative reform types, such as Michael Gerson and Peter Wehner, and Michael Strain, have written at length about the need to break from tea party orthodoxy on economic matters, and to begin to envision an affirmative government role when it comes to strengthening (and reforming) the safety net, and even spending government money to combat the near term jobs emergency. I don’t know if non-tea party Republicans can be reached and split off from the tea party on these matters or not, but it does seem at least plausible, if the above numbers are an accurate picture of things.
Meanwhile, some Republican lawmakers do seem sincere about charting a new course on poverty. But the party agenda remains in thrall to a set of ideas that remain largely the province of a small tea party minority, and are not nearly as widely held among Republicans overall.
By: Greg Sargent, The Plum Line, The Washington Post, January 24, 2014
“Enemies Of The Poor”: Republicans Are Doing All They Can To Hurt The Poor
Suddenly it’s O.K., even mandatory, for politicians with national ambitions to talk about helping the poor. This is easy for Democrats, who can go back to being the party of F.D.R. and L.B.J. It’s much more difficult for Republicans, who are having a hard time shaking their reputation for reverse Robin-Hoodism, for being the party that takes from the poor and gives to the rich.
And the reason that reputation is so hard to shake is that it’s justified. It’s not much of an exaggeration to say that right now Republicans are doing all they can to hurt the poor, and they would have inflicted vast additional harm if they had won the 2012 election. Moreover, G.O.P. harshness toward the less fortunate isn’t just a matter of spite (although that’s part of it); it’s deeply rooted in the party’s ideology, which is why recent speeches by leading Republicans declaring that they do too care about the poor have been almost completely devoid of policy specifics.
Let’s start with the recent Republican track record.
The most important current policy development in America is the rollout of the Affordable Care Act, a k a Obamacare. Most Republican-controlled states are, however, refusing to implement a key part of the act, the expansion of Medicaid, thereby denying health coverage to almost five million low-income Americans. And the amazing thing is that they’re going to great lengths to block aid to the poor even though letting the aid through would cost almost nothing; nearly all the costs of Medicaid expansion would be paid by Washington.
Meanwhile, those Republican-controlled states are slashing unemployment benefits, education financing and more. As I said, it’s not much of an exaggeration to say that the G.O.P. is hurting the poor as much as it can.
What would Republicans have done if they had won the White House in 2012? Much more of the same. Bear in mind that every budget the G.O.P. has offered since it took over the House in 2010 involves savage cuts in Medicaid, food stamps and other antipoverty programs.
Still, can’t Republicans change their approach? The answer, I’m sorry to say, is almost surely no.
First of all, they’re deeply committed to the view that efforts to aid the poor are actually perpetuating poverty, by reducing incentives to work. And to be fair, this view isn’t completely wrong.
True, it’s total nonsense when applied to unemployment insurance. The notion that unemployment is high because we’re “paying people not to work” is a fallacy (no matter how desperate you make the unemployed, their desperation does nothing to create more jobs) wrapped in a falsehood (very few people are choosing to remain unemployed and keep collecting benefit checks).
But our patchwork, uncoordinated system of antipoverty programs does have the effect of penalizing efforts by lower-income households to improve their position: the more they earn, the fewer benefits they can collect. In effect, these households face very high marginal tax rates. A large fraction, in some cases 80 cents or more, of each additional dollar they earn is clawed back by the government.
The question is what we could do to reduce these high effective tax rates. We could simply slash benefits; this would reduce the disincentive to work, but only by intensifying the misery of the poor. And the poor would become less productive as well as more miserable; it’s hard to take advantage of a low marginal tax rate when you’re suffering from poor nutrition and inadequate health care.
Alternatively, we could reduce the rate at which benefits phase out. In fact, one of the unheralded virtues of Obamacare is that it does just that. That is, it doesn’t just improve the lot of the poor; it improves their incentives, because the subsidies families receive for health care fade out gradually with higher income, instead of simply disappearing for anyone too affluent to receive Medicaid. But improving incentives this way means spending more, not less, on the safety net, and taxes on the affluent have to rise to pay for that spending. And it’s hard to imagine any leading Republican being willing to go down that road — or surviving the inevitable primary challenge if he did.
The point is that a party committed to small government and low taxes on the rich is, more or less necessarily, a party committed to hurting, not helping, the poor.
Will this ever change? Well, Republicans weren’t always like this. In fact, all of our major antipoverty programs — Medicaid, food stamps, the earned-income tax credit — used to have bipartisan support. And maybe someday moderation will return to the G.O.P.
For now, however, Republicans are in a deep sense enemies of America’s poor. And that will remain true no matter how hard the likes of Paul Ryan and Marco Rubio try to convince us otherwise.
By: Paul Krugman, Op-Ed Columnist, The New York Times, January 12, 2014
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