“Sorry, GOP Reformers”: Your Own Party Isn’t Interested
Republican reformers are getting excited. For years, Ross Douthat and David Frum have been stubbornly making the case for a more moderate and economically populist GOP that would speak to and offer solutions for the problems facing struggling Americans. They are no longer voices crying out in the wilderness.
David Brooks has joined them in a column touting several reform-minded articles in the latest issue of National Affairs, a center-right policy journal. This comes in the wake of a recent speech by Sen. Marco Rubio (R-Fla.) and some not-so-recent speeches by Sen. Mike Lee (R-Utah) on how the GOP might begin to combat poverty.
Taken together, these columns, articles, and speeches show that the movement for Republican reform has begun to persuade…at least a dozen people.
That’s no doubt an exaggeration on the low end, but it goes a long way toward explaining why I’m skeptical about reform efforts. By all means, such efforts are to be applauded and encouraged. But until Republican voters begin to express their support for them in opinion polls and at the ballot box, reform proposals will remain the impotent pet projects of pundits and politicians.
The fact is that there’s no sign so far that those voters want anything to do with new government initiatives to help the poor — or to do anything else for that matter. “Government is too big!” “Taxes are too high!” “Washington is the problem, not the solution!” Those are the only messages the Republican base wants to hear — and thus the only messages most Republicans dare deliver on the campaign trail or act on in the halls of Congress.
There’s a reason why the first tentative expressions of support for reform have come from senators, who are elected by entire states every six years. That distance from those partisan passions, which have produced a deep right-wing skew in gerrymandered House districts, gives senators more ideological freedom of movement.
Still, Republican senators must deal with irascible primary voters. And in the House there is no such freedom, which is why that chamber’s Republican majority refuses to budge on extending unemployment benefits or reversing cuts to food stamps. It is also why Speaker John Boehner’s (R-Ohio) efforts to revive immigration reform is likely to fail as well. Republican voters want none of it, and that’s exactly what they’ll get.
Congressman Paul Ryan (R-Wisc.) is the proverbial exception that proves the rule. He, too, has been trying to rebrand himself as a reformer — talking about the problem of poverty, and reaching a bipartisan deal to pass the bill that temporarily ended gridlock over the budget. All of it is an effort to make himself palatable as a general election presidential candidate. (Nothing inspires donors like “electability.”) But his position is only possible because he established himself as a leading conservative warrior on economic issues, which got the Romney ticket in so much trouble in 2012; indeed, it remains to be seen whether Ryan’s commitment to centrist reform is anything more than PR gloss.
That points to the depth of the GOP’s problem. Its base uncompromisingly demands that party members toe a line that places them far to the right of the median American voter. As long as that continues, Republicans will find themselves out of serious contention for the White House — and unable to follow through on any serious proposals for reform.
By: Damon Linker, The Week, January 10, 2014
“The Silence Of The Austerians”: Here’s Why 2014 Could Be The Year America Finally Ditches Its Inane Deficit Obsession
The year 2013 will be seen as a year of crushing intellectual defeat for advocates of fiscal austerity. There were many smaller victories, but this big one came in April. Researchers at the University of Massachusetts examined the Austerian paper, “Growth in a Time of Debt,” by Carmen Reinhart and Ken Rogoff, which said that countries whose debt-to-GDP ratio reaches 90 percent experience dramatically slower growth. The UMass folks found not only dodgy statistics and backwards causation, but a goof in the paper’s Excel spreadsheet. The causation and statistics errors were more serious, but the fact that elites around the globe had gleefully embraced something with a flub any office temp could understand was horribly embarrassing.
It was an intellectual rout that badly wrong-footed the Austerians, who have since been notably half-hearted in the face of a resurgent left now campaigning on economic justice. This includes, for example, increasing Social Security benefits, which was unthinkable two years ago, when the fight to stop benefits from being cut was nearly lost.
The question for 2014, then, will be whether this triumph can be consolidated and expanded into the policy sphere. Because despite the intellectual collapse, Austerian assumptions and reasoning still dominate United States policy, which is undertaking fiscal consolidation at a pace not seen since the WWII demobilization. If the current Austerian death grip on the framework of policy negotiation can be broken, there might be a chance.
The answer to this question turns on how one views intellectual debate. Given the history of the last few years, one could be forgiven for thinking it’s pointless. As the Polish economist Michal Kalecki demonstrated brilliantly, there are powerful cultural and class-based reasons for both political and business elites to favor austerity now.
We see this today, as Steve Randy Waldman has demonstrated, in the blatant double standards applied to austerity as compared to inequality or raising the minimum wage. Consider a recent paper by the liberal economist Jared Bernstein, which, while outlining much excellent evidence about the economic harm of inequality, is stuffed with unnecessary hedging and hesitation. The Reinhart and Rogoff paper, by contrast, was weak even without knowing about the Excel and stats errors (as Paul Krugman, among others, observed at the time), but elites nearly tripped over their own feet seizing on it anyway. Their bogus “90 percent” conclusion was stated as economic fact by everyone from Paul Ryan to the Washington Post editorial board.
However, biased reasoning is different than no reasoning at all. Seizing on a fig leaf paper fulfills a deep psychological need. Current elites may be largely greedy, corrupt hypocrites, but the cultural credibility of science is such that what amounts to outright class warfare must have an “evidence-based” patina. It’s far too gauche to simply ram through one’s favored policies because you want all the money or to kick the poor.
Therefore, fiscal policy in 2014 and 2015 will hinge on whether the Austerian coalition can be split (assuming, as is probable, that progressive Democrats don’t sweep the 2014 midterms).
Roughly speaking, we’re talking about the center and the right, and there are good reasons to suppose that neither will be brought around. For the center, it takes an intellectual defeat roughly akin to the Battle of Trafalgar to get them to grudgingly abandon austerity. (And if some hack economist churns out another pro-austerity paper, they will probably grab it eagerly.) Meanwhile, “straight” reporters have been culturally conditioned to code deficit reduction as a non-ideological good thing, so even very recent straight reporting still contains buried Austerian assumptions.
And on the right, things look especially hopeless. Denial and motivated reasoning are so epidemic that even Mitt Romney believed the “unskewed” polls before the 2012 election. Ivory tower arguments alone are useless here.
However, all hope is not lost. The key is to change what is considered acceptable for budgetary negotiations. Right now, they all assume that any new spending must be “offset” by cuts elsewhere. That aversion to deficit spending is 100 percent Austerian.
So while Republicans are largely immune to evidence, it’s also true they don’t actually care about the deficit in and of itself. They favor reduced taxes on the rich and cutting social insurance. What’s more, conservative reformists at places like National Affairs have gotten louder and bolder in their advocacy of new thinking, even including infrastructure spending.
So if the center, especially including President Obama, can be persuaded to drop their deficit obsession (and again, it’s hardly possible to overstate how badly this debate has been lost), we could trade tax cuts for some austerity relief, like re-extending unemployment benefits and food stamps. And, it’s important to note, both spending increases and tax cuts count as austerity relief. Tax cuts, especially on the rich, aren’t very good stimulus, but they still put money into people’s pockets.
But the main point is to shift ground for negotiation. This strategy of “tax cuts for more spending” has been suggested many times in the past few years and gone nowhere. But before that, it had been the basis for many successful bipartisan deals, including expanding Medicaid in the 1980s and the CHIP program in the 1990s.
So while the deck is stacked against the anti-Austerians, continuing the intellectual battle is by no account useless. It’s highly possible to influence even a crooked debate.
By: Ryan Cooper, Web Editor of The Washington Monthly; Published in The New Republic, January 5, 2014
“The GOP’s ‘Jobs’ Hypocrisy”: Their Own Party Is The Biggest Obstacle
I bring good news this new year! Conservatives have a jobs agenda, one that isn’t built around merely cutting taxes and regulations and getting the government out of the way so the free market can strut its stuff.
No—this includes… are you ready?… infrastructure investment, and a monetary policy less obsessed with keeping inflation under 2 percent. It’s new, it’s exhilarating, it’s brilliant! And it’s the same stuff that Barack Obama and most liberal Democrats have favored for years.
When David Frum, whom I respect a great deal, tweets that a new article should be thought of as “a ‘95 theses’ moment for the reformist right,” he gets my attention. So I clicked immediately and read through “A Jobs Agenda for the Right,” by Michael Strain of the American Enterprise Institute, from the new issue of National Affairs. I liked the essay and even agreed with a respectable percentage of what Strain had to say. But reading it was far more infuriating than reading something by a conservative and disagreeing with every syllable, because articles like Strain’s refuse to acknowledge, let alone try to grapple with, the central and indisputable fact that the contemporary Republican Party—his presumed vehicle for all this pro-jobs reform—has opposed many of these initiatives tooth and nail.
The first big measure Strain touts in his essay is infrastructure. “Anyone who has driven on a highway in Missouri or has taken an escalator in a Washington, D.C., Metro station knows that the United States could use some infrastructure investment,” he writes. He doesn’t lay out a specific program, but clearly he favors fairly broad public investment.
Um, OK. There are people who’ve been trying to do just that. And not only Barack Obama. John Kerry led this effort in the Senate, and he was joined by Republican Kay Bailey Hutchison (who’s since retired). Their attempts to fund a modest infrastructure bank were supported by the U.S. Chamber of Commerce. But it could never get anywhere because of rock-solid GOP opposition. Does Strain not even know this? Or is he pretending it never existed so he doesn’t have to deal with the political reality of Republican obduracy?
I think, of course, it’s the latter, and there’s further evidence for my guess in the way Strain talks about recent history. The 2009 stimulus was not a failure in infrastructure terms at all (has he read Michael Grunwald?). But even if you believe it was an infrastructure failure, or have to say so for political reasons, should you not acknowledge in fairness that it was Democrats and liberals who wanted it to have more infrastructure spending, and that nearly 40 percent of the bill took the form of tax cuts because that’s what Republicans demanded (before they decided en masse to vote against it anyway)?
From there, Strain turns to monetary policy, and this is even more comic. The Federal Reserve, he writes, should relax the 2 percent inflation target to get the unemployment numbers down. Uh, yes. It should. But it’s not as if Strain just originally thought of this. Liberals have been saying this ever since 2009, or 2008 even. And in response, conservatives have been saying that doing so will produce galloping inflation and destroy our economy. You’ve seen Ben Bernanke get badgered about inflation by Republicans from Paul Ryan on down for years. Inflation could have been 1.2 percent, or lower, but if Bernanke was up on the Hill, Republicans tore into him as if he were unleashing the mid-’70s on us again.
As I said, I agree with Strain. I agree when he writes: “In short, conservatives should see that there is a role for macroeconomic stimulus in getting the labor market back on its feet” and that “monetary policy with its eye on enabling growth can make a big difference.” Yes, they should. Well… how are they going to see that? Does Strain have some special pixie dust?
It’s astonishing that he can write this way, but it’s what they all do on the right. They maintain the fiction that their party is a party of rational people who will listen to rational argument and isn’t simply dug into a state of psychotic opposition to anything Barack Obama wants to do. Everyone watching our politics for the last five years knows that if Obama is for it, the Republicans will oppose it. Strain might say counting noses in the Senate isn’t his job. Well, OK. But at least he could acknowledge that his party has been preventing some of his own ideas from having any hope of becoming reality (he goes on to discuss other proposals, some of them more traditionally conservative, others that acknowledge a fairly strong governmental role in getting people back to work).
Usually, with regard to jobs and wage stagnation and poverty and so on, the problem is that conservatives deny empirical reality. This gives us people like Paul Ryan, for example, who genuinely seems to believe, in the face of the mountains of evidence about how the social safety net and federal entitlements have saved millions from lives of far worse destitution, that all government can do is make slaves of people. That’s bad enough.
But now, we have conservatives who accept enough empirical reality to agree that public investment is not a crime against nature, but who deny the political reality that the Republican Party stands in the way of progress. This may actually be worse. The only hope of changing Washington for the better is getting a Republican Party in which there are enough legislators who act like legislators again and who are willing to cross party lines occasionally for the sake of governance and the country. If conservative intellectuals keep pretending this isn’t a problem, there is no hope that it will change.
By: Michael Tomasky, The Daily Beast, January 3, 2014
“Job One, Helping The Jobless”: Can Congress Pass An Unemployment Insurance Extension?
When extended Unemployment Insurance benefits expired late last month, 1.3 million jobless Americans immediately lost that bit of safety net; if Congress fails to act, another 3.6 million Americans will lose this support by the end of 2014. Senate Majority Leader Harry Reid recently said that on Monday the Senate will take up a temporary extension. Getting it done would not only be smart economics but it’s also simply the right thing to do.
Many on the right oppose extending benefits under the deeply dubious theory that too much unemployment compensation makes the social safety net a comfy hammock, to borrow Paul Ryan’s evocative simile. Why would people work, the theory goes, when they can get paid to not work? So people like Kentucky Sen. Rand Paul paint opposition to extended benefits as being rooted in concern for the jobless who suffer under the seductive yolk of big government’s helping hand – never mind that the study he cites doesn’t say what he says it says. And never mind that in order to receive jobless benefits, you have to be actively seeking a job, meaning that cutting benefits could actually discourage people from continuing to look for work. And never mind the paltry nature of support. As I wrote in my column last month:
The National Employment Law Project notes that “while the average American family spends $1,407 per month on housing alone, the average monthly extension benefit is only $1,166.” Still the modest sums help: According to the Council of Economic Advisers, in 2012 alone unemployment insurance benefits “lifted an estimated 2.5 million people out of poverty.” Further, the National Employment Law Project estimates, 446,000 of those people were children.
If members of Congress (and for that matter the yammering class) need any further evidence of the importance of extending benefits, the state of North Carolina has been unkind enough to conduct an experiment in punishing the unemployed. Last February the state enacted a law which not only slashed the duration (from 26 weeks to 12-20 weeks) and amount (from a maximum of $535 to $350 per week) of unemployment benefits, but also managed to run afoul of the federal jobless program, disqualifying North Carolinians from receiving those benefits.
So what happened when the lazy parasites were forced to stop suckling at the governmental teet? BloombergBusinessweek’s Joshua Green has a good piece today answering that question:
At first glance, the effect appears to be positive. North Carolina’s unemployment rate dropped dramatically, from 8.8 percent to 7.4 percent between July and November. By comparison, the national unemployment rate fell by 0.6 percent over the same period. A closer look, however, suggests that North Carolina’s unemployment numbers have fallen not because the long-term jobless have found work but because they’ve quit looking altogether. As a result, the state no longer counts them as unemployed.
As John Quinterno of the economic research firm South by North Strategies tells Green, while the number of unemployed in the state fell by nearly 102,000 year over year, 95,000 of those people aren’t counted as jobless not because they found jobs but because they stopped looking. Meanwhile, North Carolina’s food banks are getting overwhelmed, reports Bloomberg’s Evan Soltas, who quotes one food bank director who oversees seven counties and 230 organizations as saying that “some of our member agencies have been able to meet that need, but many have not.”
So what are the odds of Congress doing the right thing? As with many prominent issues these days, Democrats have the public on their side – according to a poll by the Democratic firm Hart Research, 55 percent of voters want the benefits extended. In order to pass an extension through the Senate, Reid will need to peel off at least a handful of Republicans (he already has one – Nevada Sen. Dean Heller, who is co-sponsoring the three month extension Reid is pushing). The Washington Post’s Greg Sargent has a good run-down of Republicans from either blue or purple states or from high unemployment red states who might vote with Reid. But, Sargent concludes:
The campaign to pressure Republicans into agreeing to extend UI has essentially amounted to an effort to shame them into it, by highlighting the huge numbers of their own constituents who stand to lose lifelines if they don’t act. Local press coverage has dramatically spotlighted the issue within states, as press compilations by Dems show.
But this doesn’t appear to be working with too many Republicans.
And even if the Senate passes the bill, odds remain long that House Republicans – who refused to include an extension when they cleared last year’s budget deal – will suddenly do the right thing.
If the GOP does block the extension, 2014 is off to a grim start for millions of Americans.
By: Robert Schlesinger, U. S. News and World Report, January 2, 2013
“At The Top, There Is No Crisis”: Why A Never-Ending Disaster For 90 Percent Of America Doesn’t Worry The GOP
We’re in the middle of the worst economic disaster in modern history and we’re doing almost nothing about it, warns UC Berkeley Economist J. Bradford DeLong.
“So unless something — and it will need to be something major — returns the U.S. to its pre-2008 growth trajectory, future economic historians will not regard the Great Depression as the worst business-cycle disaster of the industrial age,” he writes. “It is we who are living in their worst case.”
The former Clinton administration official wonders why a disaster that “robs the average American family of four of $36,000 per year in useful goods and services, and that threatens to keep Americans poorer than they might have been for decades,” isn’t motivating policymakers to act.
“One would think that America’s leaders would be clambering to formulate policies aimed at returning the economy to its pre-2008 growth path: putting people back to work, cleaning up underwater mortgages, restoring financial markets’ risk-bearing capacity, and boosting investment,” he says.
Instead, Congress is debating about how much our investments should be reduced, how few weeks we should help the unemployed, how much food stamps should be cut.
The reason why we aren’t acting is clear to DeLong: “…at the top, there is no crisis.” While the incomes of the bottom 90 percent have stagnated for decades, the top has flourished. “The incomes of America’s top 10 percent are two-thirds higher than those of their counterparts 20 years ago, while the incomes of the top 1 percent have more than doubled,” he writes.
This inequality isn’t an accident of history or the result of rapid technological advancement, as conservatives like to pretend.
It’s the result of the class war the right has been waging for decades.
“Among developed countries, the U.S. does have the most unequal distribution of disposable income after taxes and transfer payments,” writes economist Laura Tyson, former chair of the President’s Council of Economic Advisers.
Our tax system is more progressive than most European countries that rely on a value-added tax but we spend far less on programs that help families and keep inequality low.
This is the victory of a conservative movement that caters to the richest Americans and seems to have no problem with a recovery that is only benefiting the richest 10 percent. Actually, it seeks to maintain the advantage for the richest by opposing policies like Medicaid expansion and assailing the labor movement.
The Republican Party doesn’t even feel the need to bother with solutions to problems that plague the lower 90 percent, like unemployment, says New York magazine’s Jonathan Chait.
“Republican thought on mass unemployment is a restaurant with tiny portions that taste terrible,” he writes.
The problem for the left is that Republicans can run and win on policies that directly increase income inequality. They can resist Democratic initiatives — even wildly popular ideas like raising the minimum wage, which would reduce poverty and increase consumer spending — and still be on track to hold the House of Representatives, while possibly even wining the Senate.
Why doesn’t the Republican Party act to reverse the greatest economic disaster in at least half a century, a disaster they could prevent?
Rep. Paul Ryan (R-WI) can reveal his secret passion for alleviating poverty over and over again while promoting policies that increase it. And still be taken seriously.
Republicans don’t care about improving the economy for the bottom 90 percent for one simple reason.
They don’t have to.
By: Jason Sattler, The National Memo, January 1, 2014
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