Americans Finally Realize GOP Handling Debt Debate Poorly
And the loser is… the GOP!
Or so says the latest CBS poll showing 71 percent of Americans don’t like the GOP’s handling of the debt crisis. And why would they? Americans have shown in polls, time and time again, that they want both sides, Democrat and Republican, to work together to get business done in Washington. To get the business of raising the debt ceiling done, that takes compromise; a word I fear Republicans don’t like or perhaps aren’t that familiar with. A great man once told me the best negotiations are when both parties leave the room winning and losing. The president has shown his ability to compromise; he put cuts to Medicare and Social Security on the table. Heck, he’s even willing to talk about cuts rather than just raising the debt ceiling on his own!
To read the polls is not only confusing, but it shows how confused we the people are. Some polls show Americans want to cut spending, but they don’t want to raise taxes. Other polls show a majority of Americans want the Bush tax credits to end for the wealthy. And after Rep. Paul Ryan put forth his machete to Medicare, he was booed at town hall meetings, and a Democrat won a congressional seat in a district which had been a Republican stronghold for decades.
This current proposal by Republicans is not a GOP plan, it’s a Tea Party debt plan, appealing to the overwhelming minority of their base, obviously pandering to the “Teapublicans” for their cash for the upcoming election.
It sickens me when I hear the GOP talk about leaving something for our children and future generations when their proposals cut more education and Medicare and Social Security, making those programs a memory for our children. And without them, our children will be financially strapped, taking care of sick and elderly parents and grandparents.
These poll numbers show the GOP cannot even convince their own party of what they’re doing, which is obviously playing politics and puffing their chests out like chicken hawks, trying desperately not to blink first in this game. And for all their talk about the Democrats’ scare tactics, the poll shows the majority feel the president raises valid concerns if the debt ceiling is not lifted.
My favorite president, and a man who I think is the most intelligent of all of them (maybe not in choices he made in his personal life), is Bill Clinton. President Clinton says he would raise the debt ceiling using powers granted under the 14th Amendment—“validity of the public debt shall not be questioned…”
Maybe it’s time President Obama took a page from the Clinton handbook and took his advice. After all, he was a constitutional lawyer. If President Obama stops the economy from going into a double dip recession by raising the debt ceiling, he’ll not only be re-elected, he’ll show America that the GOP are the losers, and prevent the American people from being so—which is what would happen if he signed that GOP plan into law.
By: Leslie Marshall, U. S. News and World Report, July 20, 2011
Cut Cap & Balance And The New Frontiers of Kookery
A scant few months after the Paul Ryan budget redefined the boundaries of conservative fanaticism, the Republican Party’s new “Cut, Cap, and Balance” Constitutional Amendment makes that document seem quaintly reasonable. Ezra Klein sums up the policy:
Ronald Reagan’s entire presidency would’ve been unconstitutional under CC&B. Same for George W. Bush’s. Paul Ryan’s budget wouldn’t pass muster. The only budget that might work for this policy — if you could implement it — would be the proposal produced by the ultra-conservative Republican Study Committee. But that proposal was so extreme and unworkable that a majority of Republicans voted it down.
37 House Republicans and 12 Senate Republicans have pledged not to support a debt ceiling increase unless the CC&B Constitutional Amendment passes. Mitt Romney has signed this insane pledge. Ramesh Ponnuru has some gentle questions:
Representative Mick Mulvaney, a freshman Republican from South Carolina who is a leading supporter of the amendment, said in an interview that if “the president wants this debt-ceiling increase, he’s going to help us get the votes.” He argued that Obama should deliver 50 Democratic votes in the House and 20 to 30 in the Senate. “That’s a good compromise for both sides.”
Does the congressman think that 50 Republicans would vote for a constitutional amendment that contradicts everything they stand for if President Romney asked them to?
What a congressman who pledges to increase the debt limit only if a spending-limit amendment passes is really saying is that he opposes increasing the debt limit. Because there is no way that two-thirds of Congress is going to pass this amendment now, or ever.
Perhaps the most remarkable thing about the CC&B amendment is the casual way in which it attempts to enshrine specific spending levels and to freeze current taxes into the Constitution. I would like to see its advocates explain why it is necessary for the Constitution to require their agenda. What is keeping the public from electing officials who will enact this agenda? If people want to enact policies like this, why not just let them do it? And if they don’t, why force these policies upon them?
By: Jonathan Chait, The New Republic, July 19, 2011
The Incredible Crazies: Finding Someone The House GOP Will Listen To
Negotiating with House Republicans isn’t just difficult because they refuse to compromise; it’s also because they don’t even appreciate the point of the exercise. Told, for example, that failure on the debt ceiling would lead to a disaster, the House GOP simply doesn’t believe the evidence.
It’s challenging enough trying to craft an agreement when the parties have the same goal. But what happens when the crew of the Titanic says, “The captain’s wrong; icebergs are no big deal”?
The trick is finding someone the crazies find credible. (thanks to T.K.)
Republican leaders in the House have begun to prepare their troops for politically painful votes to raise the nation’s debt limit, offering warnings and concessions to move the hard-line majority toward a compromise that would avert a federal default. […]
At a closed-door meeting Friday morning, GOP leaders turned to their most trusted budget expert, Rep. Paul D. Ryan of Wisconsin, to explain to rank-and-file members what many others have come to understand: A fiscal meltdown could occur if Congress fails to raise the debt ceiling. […]
The warnings appeared to have softened the views of at least some House members who, until now, were inclined to dismiss statements by administration officials, business leaders and outside economists that the economic impact would be dire if the federal government were suddenly unable to pay its bills. [emphasis added]
Right-wing freshman Rep. Steve Womack (R-Ark.) said he found the presentation, particularly the parts about skyrocketing interest rates, “sobering.”
Oh, now it’s “sobering”? We’re 17 days before the drop-dead crisis deadline, and now it’s dawning on some House Republicans that they’re not only playing with matches, but may actually torch the entire economy?
At this point, of course, I’ll take progress wherever I can find it. If some of the House GOP’s madness is “softening,” maybe they’ll be slightly more inclined to be responsible.
But I can’t help but find it interesting the limited pool of individuals Republicans are willing to listen to. The Treasury tells the House GOP caucus members they have to raise the debt ceiling, and Republicans don’t care. The Federal Reserve tells them, and they still don’t care. House Speaker John Boehner tells them, and that doesn’t work, either. Business leaders, governors, and economists tell them, and Republicans ignore all of them.
But Paul Ryan warns of a meltdown and all of a sudden, the House GOP is willing to pay attention.
I guess we should be thankful the radical House Budget Committee chairman is only wrong 90% of the time, and not 100%.
By: Steve Benen, Contributing Writer, Washington Monthly-Political Animal, July 16, 2011
Getting to Crazy: The Culmination Of A GOP Process
There aren’t many positive aspects to the looming possibility of a U.S. debt default. But there has been, I have to admit, an element of comic relief — of the black-humor variety — in the spectacle of so many people who have been in denial suddenly waking up and smelling the crazy.
A number of commentators seem shocked at how unreasonable Republicans are being. “Has the G.O.P. gone insane?” they ask.
Why, yes, it has. But this isn’t something that just happened, it’s the culmination of a process that has been going on for decades. Anyone surprised by the extremism and irresponsibility now on display either hasn’t been paying attention, or has been deliberately turning a blind eye.
And may I say to those suddenly agonizing over the mental health of one of our two major parties: People like you bear some responsibility for that party’s current state.
Let’s talk for a minute about what Republican leaders are rejecting.
President Obama has made it clear that he’s willing to sign on to a deficit-reduction deal that consists overwhelmingly of spending cuts, and includes draconian cuts in key social programs, up to and including a rise in the age of Medicare eligibility. These are extraordinary concessions. As The Times’s Nate Silver points out, the president has offered deals that are far to the right of what the average American voter prefers — in fact, if anything, they’re a bit to the right of what the average Republican voter prefers!
Yet Republicans are saying no. Indeed, they’re threatening to force a U.S. default, and create an economic crisis, unless they get a completely one-sided deal. And this was entirely predictable.
First of all, the modern G.O.P. fundamentally does not accept the legitimacy of a Democratic presidency — any Democratic presidency. We saw that under Bill Clinton, and we saw it again as soon as Mr. Obama took office.
As a result, Republicans are automatically against anything the president wants, even if they have supported similar proposals in the past. Mitt Romney’s health care plan became a tyrannical assault on American freedom when put in place by that man in the White House. And the same logic applies to the proposed debt deals.
Put it this way: If a Republican president had managed to extract the kind of concessions on Medicare and Social Security that Mr. Obama is offering, it would have been considered a conservative triumph. But when those concessions come attached to minor increases in revenue, and more important, when they come from a Democratic president, the proposals become unacceptable plans to tax the life out of the U.S. economy.
Beyond that, voodoo economics has taken over the G.O.P.
Supply-side voodoo — which claims that tax cuts pay for themselves and/or that any rise in taxes would lead to economic collapse — has been a powerful force within the G.O.P. ever since Ronald Reagan embraced the concept of the Laffer curve. But the voodoo used to be contained. Reagan himself enacted significant tax increases, offsetting to a considerable extent his initial cuts.
And even the administration of former President George W. Bush refrained from making extravagant claims about tax-cut magic, at least in part for fear that making such claims would raise questions about the administration’s seriousness.
Recently, however, all restraint has vanished — indeed, it has been driven out of the party. Last year Mitch McConnell, the Senate minority leader, asserted that the Bush tax cuts actually increased revenue — a claim completely at odds with the evidence — and also declared that this was “the view of virtually every Republican on that subject.” And it’s true: even Mr. Romney, widely regarded as the most sensible of the contenders for the 2012 presidential nomination, has endorsed the view that tax cuts can actually reduce the deficit.
Which brings me to the culpability of those who are only now facing up to the G.O.P.’s craziness.
Here’s the point: those within the G.O.P. who had misgivings about the embrace of tax-cut fanaticism might have made a stronger stand if there had been any indication that such fanaticism came with a price, if outsiders had been willing to condemn those who took irresponsible positions.
But there has been no such price. Mr. Bush squandered the surplus of the late Clinton years, yet prominent pundits pretend that the two parties share equal blame for our debt problems. Paul Ryan, the chairman of the House Budget Committee, proposed a supposed deficit-reduction plan that included huge tax cuts for corporations and the wealthy, then received an award for fiscal responsibility.
So there has been no pressure on the G.O.P. to show any kind of responsibility, or even rationality — and sure enough, it has gone off the deep end. If you’re surprised, that means that you were part of the problem.
By: Paul Krugman, Op-Ed Writer, The New York Times, July 14, 2011
Why The GOP’s ‘Job Creators’ Are Hard to Find
If you’re a “job creator,” raise your hand. It would be nice to know who you are, exactly.
Republicans negotiating with President Obama over a fix for the nation’s debt problems have been rolling out the heavy buzzwords lately, and there must have been a fresh memo about the sonorous ring of “job creators.” House Speaker John Boehner repeatedly decries tax hikes on job creators, with congressional colleagues such as Paul Ryan and Jeb Hensarling forming a job-creators chorus behind him. House Republicans recently published a “Plan for America’s Job Creators” (but not for everybody else, presumably) and if you’re an aggrieved job creator, you can let House Majority Leader Eric Cantor know what’s bugging you by filling out a brief form at http://jobs.majorityleader.gov/.
The trouble is, job creators are an endangered species these days. The biggest problem in the U.S. economy, in fact, is a shortage of job creators to reward and protect. Companies are barely hiring, and there are about 7 million fewer jobs now than there were at the end of 2007, when the Great Recession began. Part of the Republicans’ plan is to lower taxes, streamline regulation, open more trade and take other steps that will stimulate job creation. But we’ve already tried some of that, including several rounds of tax cuts since 2008. Most job creators are still hiding.
Big companies employ a lot of Americans, but over the last few years they’ve been better at job destruction than job creation. Between 2007 and 2010, companies with more than 1,000 employees shed about 2.6 million jobs, according to the latest data from the Labor Department. Many big companies have rebounded sharply from the recession, with impressive profits and a lot of cash on hand. But even some of the most successful big companies aren’t doing much job creation–not in the United States, anyway. Here are a few examples:
General Electric, which is run by the same Jeffrey Immelt who chairs President Obama’s Council on Jobs and Competitiveness, axed 32,000 jobs worldwide between 2007 and 2010, according to information from GE’s annual reports. About 22,000 of those lost jobs were in the United States. No job creation there, even though GE earned about $12 billion in profits in 2010.
Exxon Mobil has added about 2,800 jobs worldwide since 2007, but the giant oil firm doesn’t break out how many of those new hires work in the United States. Since Exxon earns nearly 70 percent of its revenue from overseas, it’s a good bet that’s where most of the new jobs are, too.
Wal-Mart has added about 40,000 jobs in the United States since 2007, largely because the discount retailer has been a beneficiary of pinched consumers desperate to save money. But it has added about 150,000 jobs overseas during the same time–nearly four times the U.S. tally. Still, Wal-Mart seems to be one company that can legitimately call itself a job creator.
IBM has added about 40,000 employees since 2007, but like Exxon, it doesn’t say where. About 65 percent of IBM’s revenue comes from abroad, and that’s where almost all of its revenue growth has come from since 2007. IBM’s U.S. business is actually down from 2007 levels, so it’s possible that most or all of IBM’s new hires have been overseas.
Big companies, in fact, aren’t considered a big source of new jobs. While they generate a lot of profits, they also tend to be mature enterprises more likely to swallow other companies and consolidate market share, which tends to eliminate jobs, not create them. “It’s the job of big firms to shed jobs,” says Carl Schramm, CEO of the Kauffmann Foundation, which promotes entrepreneurship. “Big firms want to lower costs, which means lowering labor costs.”
Young firms, Schramm says, account for virtually all net job creation in the U.S. economy over the last 30 years. That’s because startups that survive their first couple of years tend to be vibrant, fast-growing companies that create new industries and hire a lot of new workers. Think Microsoft and Oracle in the 1980s, and Amazon, eBay, and Google in the 1990s. Today, new technology-based firms like Facebook, Twitter, Groupon, Zynga, and LinkedIn represent one of the fastest-growing sectors of the U.S. economy. However, they’re the last companies that need any kind of tax relief–and they’re not about to ask for special treatment from Washington, either. They became transformative companies without Washington’s help, and they’d like to keep it that way.
Politicians routinely extol the virtues of “small business,” but that’s not really where the job creators are, either. Conventional small businesses–dry cleaners, nail salons, delicatessens, independent professionals like lawyers and doctors–tend to be important pillars of their communities, but they also come and go without generating a lot of new jobs, on balance. During the third quarter of 2010 (the most recent quarter for which there’s data), firms with fewer than 20 employees eliminated 34,000 jobs, according to the Labor Department. The biggest gains were among firms with 500 to 999 employees, which created 37,000 jobs.
So if Republicans want to modify the tax code to reward and encourage job creators, they need to come up with a scheme that offers the lowest tax rates to fast-growing startups, some medium-sized firms, and a few select multinationals. Of course, they might prefer to lower taxes on everybody who could be a job creator–because that includes almost everybody. If you ever spend money, that makes you a job creator, in the most expansive sense of the phrase, since somebody gets paid to provide whatever you buy. But then we’d have to figure out whether to reward American consumers for helping create jobs in China, Japan, Sri Lanka, or wherever the imported goods they purchase come from, or to reward people who spend money that helps create American jobs. So if you buy a Lexus made in Japan or Gucci loafers made in Italy, you’re not really a creator of American jobs and you shouldn’t be eligible for favorable tax treatement. But if you have your kitchen remodeled by a local contractor or go to a chiropractor for back pain, you qualify. It’s not so easy being a job creator. Or locating one.
By: Rick Newman, U. S. News and World Report, July 13, 2011
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