“The Great Pretenders”: GOP Deficit Hypocrisy
Republicans love to harp on deficit reduction when a Democratic president releases a budget. But when they’re in power themselves, they couldn’t care less.
Now we are treated to the semiannual spectacle of watching Republicans pretend they care about the deficit. They will hammer at this repeatedly as discussion progresses on the president’s budget budget, which projects a deficit of more than $1 trillion for this year and $901 billion for next. Obama and the Democrats generally have a history of quaking when this deficit talk starts up. But the best thing they can do now is stick to their guns and quote Dick Cheney: “Deficits don’t matter.” Growth matters. And for growth, we need investment.
First, the Republican hypocrisy. I hope you are aware by now that they don’t actually care about deficits. They just care about money being spent on things they don’t like, which outside of overpriced ships the Navy probably doesn’t need and more reinforced steel for the border fence includes pretty much everything. If, say, instead of seeking to spend more money for transportation, Barack Obama had proposed cutting the top marginal tax rate down to 8 percent, well, that would have had a completely disastrous impact on future deficits. But you wouldn’t have seen Republicans complaining about that, because the rich deserve more of their money back.
You also didn’t see Republicans complaining about deficits when George W. Bush was running them up. Oh, a few did. But the protests were infrequent and mousy. By and large, Republicans shuffled along. It is astonishing, isn’t it, to think back on the prescription-drug benefit from 2003. An unfunded, roughly $500 billion expansion of socialized medicine (Medicare), and Tom DeLay kept the floor open for three extra hours so that the small number of Republicans who tried to take the Republican position on this could be browbeaten into voting with the White House. That episode, engineered by DeLay, was as close as we’ve come to legislative fascism in this country in a long, long time, both in the sense of the strong-arm tactics used and in the way it posited that day is night and black is white.
Of course, in 2003 the deficit was “just” $374 billion. This, remember, was only two years after Bush took office, met by a surplus of $237 billion. So he added $611 billion to the deficit in two short years, by diddling around with indefensible tax cuts for the wealthy (remember how they goosed the economy? Didn’t think so) and passing the aforementioned Medicare expansion to shore up the senior vote. Admittedly, Obama outpaced Bush. He added $1 trillion in a year. But we all know why. Well, some of us know why. The economy was going to die, and it needed money. Wall Street and the banks didn’t have it, so the government had to supply it.
The only problem with this was that it didn’t supply enough. I’ve started reading Noam Scheiber’s The Escape Arti$ts, his new book about the Obama economic team’s successes and failures. Scheiber writes that Christina Romer, the administration’s first chief economist, got all the numbers on the economy from the Fed and other reputable sources and set out to determine how much federal intervention, free of political considerations, would be appropriate to prop up the collapsing economy. The number she and her staff settled on—$1.8 trillion—was so high that she didn’t even dare mention it at meetings. Obama, of course, did less than half that, which was the maximum that was politically possible.
After the heavy artillery fire he took for that, Obama decided he had to placate the deficit hawks, at least rhetorically, and so he did that for a while. But that collapsed, partly because the Republicans wouldn’t consider tax increases as part of the mix, and partly because he and the White House eventually figured out that trying to be moderate on these issues was both bad substance and lousy politics. It’s bad substance because, as much as it infuriates some people, government spending helps keep us afloat in hard times. And cutting that spending causes harm. For example, we are down about 610,000 government employees from the day Obama took office. Most of those are at the state and local level, and while it’s hard to say how many are a result of the drastic cuts in federal aid to states, certainly many layoffs stem from budget cuts. Those cuts reduce the deficit, but they add directly to the jobless rolls. Is that what we’ve needed for these past two years? Obviously not.
And it’s bad politics because, as the White House now seems to grasp, it’s time to draw contrasts, and the public is largely on Obama’s side. People kinda-sorta say they care about the deficit, but they don’t, really, in large numbers. And to the extent that they do care, they’d rather raise taxes on the wealthy than cut programs.
When the economy gets better, the deficit will start to heal itself. If the economy is truly picking up in the way the January jobs numbers suggest—and if unemployment goes down to around 8 percent by the end of the year—we’ll be poised for a recovery that will add jobs and tax revenue. At least, that is, until the next Republican president comes along and slashes taxes on multimillionaires, blowing another huge hole in the deficit (Mitt Romney’s hole, for example, would be $600 billion in 2015 alone). If Romney is actually elected, the same Republicans who are going to spend the next few months nattering about Obama’s irresponsibility will be marveling at President Romney’s courage.
But Obama standing firm against the deficit hypocrites will render a Romney presidency even more unlikely than it already is. Republicans use deficit politics to scare Democrats, and Democrats often respond exactly as Republicans hope. It’s time they stopped being afraid.
By: Michael Tomasky, The Daily Beast, February 14, 2012
“Outlawing Contraception”: Virginia House Passes Personhood Bill
Republican delegate Bob Marshall says critics are overstating things when it comes to the personhood bill he is sponsoring in Virginia. Opponents of his bill have argued that not only does the measure grant legal protections to all fetuses beginning at conception, but it could also be construed to outlaw birth control.
The bill is ostensibly less stringent than similar measures that came up in Colorado and Mississippi. As Marshall points out, it does not directly outlaw abortion, but would force the courts to include embryos in definitions of person. “I think I struck a middle ground,” says Marshall.
Try telling that to the bill’s opponents, who fear the bill’s consequences for women’s health. The House rejected an amendment by Democratic delegate Virginia Watts that would have specifically protected birth-control access.
Marshall called the amendment “a vehicle to entrap me,” arguing it would have hurt the bill in court. By specifically allowing birth control, Marshall says, the courts could interpret the bill as prohibiting anything not specifically allowed. “If I were to accept any one of these,” he said, the courts could say “here’s Mr. Marshall, acknowledging unintended consequences.”
But Watts argues the bill already has that problem because it specifically allows in-vitro fertilization. The last section of Marshall’s bill notes that “nothing in this section shall be interpreted as affecting lawfully assisted conception.” In other words, in-vitro is okay. Watts contends that because the bill specifically allows in vitro, it therefore disallows any other acts that would interfere with conception—like birth control. “You said it doesn’t pertain to one thing, therefore it does to everything else,” says Watts. “That’s why my amendment was so crucial … anything that keeps that from being implanted in the womb, kills a person under this bill.”
The bill is headed to the state Senate, where no one seems to know what will happen. While the House committee that dealt with Marshall’s bill was stacked in favor of the Republicans, the Senate’s committee is almost split: seven Republicans who vote pretty consistently with the pro-life advocates, seven Democrats who usually vote pro-choice. Then there’s Senator Harry Blevins, a Republican who’s record is less absolute. Without Blevins’ vote, the bill would probably not make it out of committee. Neither Marshall nor Watts had a clear idea which way Blevins was leaning and the senator was unavailable for comment this afternoon.
Watts is hopeful the debate over her amendment specifically allowing birth control will highlight what’s at stake. “I think that my amendment being so clearly before the body really underscores what’s there,” she said. “Up until then, you could just obfuscate all this with a lot of verbiage.”
Meanwhile Marshall’s busy painting an almost inverse portrait of his bill. “People who are otherwise intelligent keep bringing up these red herrings,” he said, noting that “when it comes to sex a lot of people can’t think straight.” At least that’s something both sides can likely agree on.
By: Abby Rapoport, The American Prospect, February 14, 2012
The Republicans’ Deceptive Payroll Tax Compromise
Republicans finally came to their senses yesterday and realized they were waging a losing battle with their opposition to a payroll tax extension. The two-month extension Congress passed in December was set to expire by the end of this month, and Republicans were adamant that any further extension be paired with equal spending cuts. Democrats balked, instead suggesting a surtax on millionaires that the Republicans would never accept, and another last minute legislative showdown appeared inevitable. Then out of nowhere yesterday afternoon Congressional Republicans announced that they would drop their resistance:
“Because the president and Senate Democratic leaders have not allowed their conferees to support a responsible bipartisan agreement, today House Republicans will introduce a backup plan that would simply extend the payroll tax holiday for the remainder of the year while the conference negotiations continue regarding offsets, unemployment insurance, and the ‘doc fix,’” said GOP leaders in an official statement Monday afternoon.
The last impasse on the tax extension left Republicans limping out of Washington for the Christmas recess. The payroll tax cut—which maintains the current 4.2 percent rate that, for a family earning $50,000 a year, amount to about $80 extra per month than the standard 6.2 percent rate—is a widely popular measure and Republicans faced public scrutiny as their obstinacy risked raising taxes on 160 million people, all in the name of political brinkmanship. By slipping this announcement out far in advance of the deadline on the same day the president released the 2013 budget, Republicans hoped to avoid a repeat of their previous public relations debacle.
Seems like an unabashed win for the Democrats, right? It’s certainly reassuring that the payroll tax extension, a form of stimulus bolstering the still shaky economy, will remain in place through the end of the year. Except unlike the December concession, this change of heart only covers the politically popular payroll tax. Excluded is an extension of unemployment benefits for the long-term jobless and the so-called Doc Fix, which stalls a drastic drop in the fees paid to Medicare physicians.
I imagine Republicans will also find common ground on the latter half—they wouldn’t want to position themselves against your grandma’s doctor during an election year—but the agreement seems designed as a ploy to put an end to the increased unemployment benefits that Republicans have fought against throughout Obama’s presidency. While the payroll tax cut helps keep the economy afloat, the unemployment benefits are the more simulative part of the equation, possibly dropping GDP by 0.3 percent if no extension is passed. But since those benefits aren’t dolled out to as wide a base as the payroll tax, there is less of a public groundswell whenever Republicans hold the extension hostage.
If Democrats buy into the Republicans’ attempts to separate the various measures, it’s unlikely that any offsets would be enough to convince Republicans to support extending unemployment. The party is secretly crossing their fingers, hoping the economy doesn’t improve before Obama is on the ballot this fall. Any form of stimulus that lacks widespread appeal would be a nonstarter.
By: Patrick Caldwell, The American Prospect, February 14, 2012
“A Very Bad Boy”: Will Gov. Scott Walker Ever Come Clean On Wisconsin’s Budget Deficit?
Scott Walker is running a television commercial extolling the crowning achievement of his short time in office —the balancing of the Wisconsin state budget and the wiping out of the $3.2 billion deficit he inherited. Check this out: http://youtu.be/vYFrt_jwdCk
Even the harshest critic of the Wisconsin governor would have to acknowledge that this is some pretty impressive work. For a governor to balance his state’s budget in these tough times—even if it is done by making Draconian cuts to health and education—is a noteworthy accomplishment.
Of course, such admiration would only be required if the Governor had, in truth, actually succeeded in the manner he suggests.Unfortunately, it turns out that Scott Walker is being a very bad boy…again.
In fact, we now know that the Governor is either being untruthful with the good people of Wisconsin on the whole ‘I balanced the budget and wiped out the deficit’ thing or he’s been, shall we say, stretching the truth when speaking to Uncle Sam on the same topic.
As we all know, it’s not nice to lie to your Uncle Sam.
In a letter sent by Mike Huebsch, Walker’s Administration Secretary, to the U.S. Department of Health & Human Services just two months ago, Huebsch disclosed that the state of Wisconsin would have an ‘undisclosed deficit’ from January, 2012 through June, 2013.
But didn’t we all just watch the video where Walker extolls his great victory in cleaning up the state’s multibillion dollar deficit?
If you’re confused, get use to it as it only gets worse.
This latest episode in the “Adventures of Scott In Dairyland” it is the perfect expression of everything we have come to expect from Governor Walker—half-truths designed to mislead, broken campaign promises, and a predilection to sneak through the back door when going in via the front would result in way too much unwanted exposure.
Let’s begin with why Walker would want to go on record with his letter to HHS claiming a deficit while, at the same time, campaigning on a message that tells a very different story.
Federal law allows a state to remove people from the state’s Medicaid rolls only in the circumstance where the state can show that it is suffering deficits. As Walker is planning to make even more cuts to Wisconsin’s health budgets—cuts he tells us he is attempting to accomplish without forcing people out of this critical health program—the Governor wants to keep his options open. To do that, it was necessary for the Walker Administration to tell HHS that his state is running a deficit while attempting, at the same time, to convince voters of the precise opposite—all so he can hold onto the opportunity to place more than 50,000 Wisconsinites in danger of losing their only access to health care.
Perfectly understandable, yes? After all, what’s a governor to do when he wants to take health care away from thousands while trying to convince those same people to vote for him in a recall election?
It’s not easy being Scott.
Still, we are left to wonder whether Walker is lying to the people of Wisconsin or fibbing to the federal government? It pretty much has to be one or the other.
The answer is dependent on, of all things, accounting.
The Milwaukee Journal Sentinel does a good job of laying it out-
In June, Walker and Republican lawmakers passed a balanced budget according to the measure that is always used for state budgets – cash accounting. That means essentially that the state will have cash left in its main account – an estimated balance of $68 million – when the budget ends on June 30, 2013.
That’s the measure that state officials use for budgets and the one Walker has repeatedly touted in statements when he says he eliminated a $3 billion budget deficit on a cash accounting basis.”
There are, essentially, two accepted methods of accounting. There is the “cash method”— the one utilized by the Wisconsin legislature and Gov. Walker in creating their balanced budget—which accounts for how much money is in the bank at the end of the fiscal year after bills have been paid. If there remains cash in the bank account, then there is no deficit.
Of course, this approach does not take into account the reality that upcoming obligations are not only going to wipe out that cash, but create a deficit when those obligations exceed what is in the bank. As a result, cash accounting rarely presents a true picture of an organization’s finances—which is precisely why every public company in America, along with most city and country units of government, are required to use the GAAP method.
GAAP (the acronym for Generally Accepted Accounting Practices) accounting takes into consideration the money expected to come in and the money committed to going out in order to work out where an organization actually stands.
If you employ the cash method being utilized by Governor Walker, were you to have $100 in the bank at the end of the year, after all the invoices that came in during December have been paid, you can credibly claim that you have no deficit. Never mind that you know full well that a credit card bill is coming in January for the $5,000 you spent Christmas shopping during the month of December and that there won’t be anywhere near enough cash in your bank account to pay that bill when it arrives. That is what we call a deficit. If you are using GAAP, you are required to account for that $5,000 obligation in the month you rack up the obligation. Thus, what is a $100 surplus if you are using cash accounting becomes a $4900 deficit if you are using the more precise GAAP accounting.
What Walker is doing here is using the cash method of accounting to form the basis of his claims as stated in his advertisement while using GAAP accounting when making his claim to the Feds.
That’s a no-no in anybody’s version of the real world—or should I say anybody but Scott Walker. While the rest of us are required to live and die by the accounting method we choose, Governor Walker, apparently, doesn’t believe that this applies to him because …well, because Governor Walker is ‘special’. He is, after all, on a first name basis with the Koch Brothers.
To be fair, politicians have long used the more favorable cash method of accounting to lay claim to better financial results, including Walker’s predecessor, Democrat Governor Jim Doyle. However, because this is so dishonest a way of putting forth the realities of a state’s financial condition, people have long been disturbed by the practice—people like ….Scott Walker?
It seems that while Governor Walker now chooses to use cash basis accounting rather than a more honest representation of the state’s finances—at least when reporting his results to the people of Wisconsin—Candidate Walker saw it very differently. In fact, in 2010, Walker vigorously campaigned on the importance of ridding the state of this distorted method of accounting, going so far as to state on his campaign website that he would “Require the use of generally accepted accounting principles (GAAP) to balance every state budget, just as we require every local government and school district to do.”
How quickly he forgets—except when it serves his purposes to suddenly convert to GAAP when he wants something from the federal government.
There is really no logical way around the conclusion that Governor Walker has, at the very least, (a) broken an important campaign promise within months of making that promise, and (b) lied to either the people of Wisconsin or the government of the United States.
The good news is that Governor’s Walker’s spokesman, Cullen Werwie, doesn’t see a big deal here. He tells us that this is all “…nothing more than what we’ve been saying all along.”
That’s good enough for me. I mean, it’s not like this is the Cullen Werwie who required a grant of immunity from prosecution before he would cooperate with prosecutors in the John Doe investigation into illegal electioneering that threatens to bring down the Walker Administration before we even get to the recall vote.
Oh wait….it seems that the governor’s chief spokesman is the very same Cullen Werwie who required a grant of immunity to avoid prosecution.
Say what you will about the folks running things up in Madison, Wisconsin, but you certainly can’t say they aren’t colorful.
“Severe Conservative Syndrome”: An Incurable Malady Detached From Rationality
Mitt Romney has a gift for words — self-destructive words. On Friday he did it again, telling the Conservative Political Action Conference that he was a “severely conservative governor.”
As Molly Ball of The Atlantic pointed out, Mr. Romney “described conservatism as if it were a disease.” Indeed. Mark Liberman, a linguistics professor at the University of Pennsylvania, provided a list of words that most commonly follow the adverb “severely”; the top five, in frequency of use, are disabled, depressed, ill, limited and injured.
That’s clearly not what Mr. Romney meant to convey. Yet if you look at the race for the G.O.P. presidential nomination, you have to wonder whether it was a Freudian slip. For something has clearly gone very wrong with modern American conservatism.
Start with Rick Santorum, who, according to Public Policy Polling, is the clear current favorite among usual Republican primary voters, running 15 points ahead of Mr. Romney. Anyone with an Internet connection is aware that Mr. Santorum is best known for 2003 remarks about homosexuality, incest and bestiality. But his strangeness runs deeper than that.
For example, last year Mr. Santorum made a point of defending the medieval Crusades against the “American left who hates Christendom.” Historical issues aside (hey, what are a few massacres of infidels and Jews among friends?), what was this doing in a 21st-century campaign?
Nor is this only about sex and religion: he has also declared that climate change is a hoax, part of a “beautifully concocted scheme” on the part of “the left” to provide “an excuse for more government control of your life.” You may say that such conspiracy-theorizing is hardly unique to Mr. Santorum, but that’s the point: tinfoil hats have become a common, if not mandatory, G.O.P. fashion accessory.
Then there’s Ron Paul, who came in a strong second in Maine’s caucuses despite widespread publicity over such matters as the racist (and conspiracy-minded) newsletters published under his name in the 1990s and his declarations that both the Civil War and the Civil Rights Act were mistakes. Clearly, a large segment of his party’s base is comfortable with views one might have thought were on the extreme fringe.
Finally, there’s Mr. Romney, who will probably get the nomination despite his evident failure to make an emotional connection with, well, anyone. The truth, of course, is that he was not a “severely conservative” governor. His signature achievement was a health reform identical in all important respects to the national reform signed into law by President Obama four years later. And in a rational political world, his campaign would be centered on that achievement.
But Mr. Romney is seeking the Republican presidential nomination, and whatever his personal beliefs may really be — if, indeed, he believes anything other than that he should be president — he needs to win over primary voters who really are severely conservative in both his intended and unintended senses.
So he can’t run on his record in office. Nor was he trying very hard to run on his business career even before people began asking hard (and appropriate) questions about the nature of that career.
Instead, his stump speeches rely almost entirely on fantasies and fabrications designed to appeal to the delusions of the conservative base. No, President Obama isn’t someone who “began his presidency by apologizing for America,” as Mr. Romney declared, yet again, a week ago. But this “Four-Pinocchio Falsehood,” as the Washington Post Fact Checker puts it, is at the heart of the Romney campaign.
How did American conservatism end up so detached from, indeed at odds with, facts and rationality? For it was not always thus. After all, that health reform Mr. Romney wants us to forget followed a blueprint originally laid out at the Heritage Foundation!
My short answer is that the long-running con game of economic conservatives and the wealthy supporters they serve finally went bad. For decades the G.O.P. has won elections by appealing to social and racial divisions, only to turn after each victory to deregulation and tax cuts for the wealthy — a process that reached its epitome when George W. Bush won re-election by posing as America’s defender against gay married terrorists, then announced that he had a mandate to privatize Social Security.
Over time, however, this strategy created a base that really believed in all the hokum — and now the party elite has lost control.
The point is that today’s dismal G.O.P. field — is there anyone who doesn’t consider it dismal? — is no accident. Economic conservatives played a cynical game, and now they’re facing the blowback, a party that suffers from “severe” conservatism in the worst way. And the malady may take many years to cure.
By: Paul Krugman, Op-Ed Columnist, The New York Times, February 12, 2012
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