“Let’s Take Healthcare Away”: Lindsey Graham Struggles With Fiscal Basics
There was an exchange yesterday between Fox News’ Chris Wallace and Sen. Lindsey Graham (R-S.C.) that was hard to watch, but nevertheless illustrative of a larger point.
WALLACE: You know that if we go into the sequester the president is going to hammer Republicans. The White House has already put out a list of all the things, terrible things that will happen if a sequester kicks in: 70,000 children losing Head Start, 2,100 fewer food inspectors, small business will lose $900 million in loan guarantees. And, you know, Senator, the president is going to say your party is forcing this to protect tax cuts for the wealthy.
GRAHAM: Well, all I can say is the Commander-In-Chief thought — came up with the idea of sequestration, destroying the military and putting a lot of good programs at risk. Here’s my belief: let’s take “Obamacare” and put it on the table…. If you want to look at ways to find $1.2 trillion in savings over the next decade, let’s look at “Obamacare”. Let’s don’t destroy the military and just cut blindly across the board.
Now, the first point is obviously ridiculous. Republicans are heavily invested in the idea that automatic sequestration cuts were something President Obama “came up with,” but reality shows otherwise. It’s trivia anyway — what matters is resolving the threat, not imagining who created it — but what Graham chooses to overlook is every relevant detail: the sequester was part of the ransom paid to the Republican Party when it took the nation’s full faith and credit hostage for the first time in American history. GOP leaders, at time, bragged that this policy was their idea, not Obama’s.
If Graham doesn’t like the sequester — and he clearly seems to agree that it’s a serious problem — he can support scrapping the policy or coming up with a bipartisan alternative. For now, he’s opposed to both of those options, making his whining yesterday rather unpersuasive.
But Graham turning his focus to the Affordable Care Act serves as a reminder of just how unserious he is about public policy.
Let’s be clear about what the South Carolinian is saying here. About $1.2 trillion in automatic cuts are set to kick in, doing real harm to the economy, the military, and the country overall. Lawmakers could cancel or delay the policy, though Republicans aren’t interested in either of these options, or they can come up with a bipartisan alternative that replaces the sequester with something else.
With 11 days to go, Lindsey Graham’s contribution to the discussion, in effect, is, “I know! Let’s take health care benefits away from millions of Americans!”
It’s worth noting that even the most reflexive partisans should realize their anti-“Obamacare” preoccupation is quickly becoming laughable. Republican governors are implementing the law; House Speaker John Boehner (R-Ohio) recently conceded the Affordable Care Act is “the law of the land“; public support for repeal is evaporating; and when folks like Orrin Hatch and Michele Bachmann unveil repeal bills, even most GOP lawmakers ignore them.
Graham, in other words, really needs to get over it.
But more important from a substantive perspective is that the South Carolina Republican still doesn’t understand the basics of the fiscal debate. The point of looking for a sequester alternative is to find a new policy on debt-reduction. If policymakers scrapped the Affordable Care Act, it would make the debt worse, not better.
In other words, Graham thinks Washington can produce smaller deficits by producing larger deficits. That doesn’t make any sense.
By: Steve Benen, The Maddow Blog, February 18, 2013
“Weather Vane Man”: Tracking Paul Ryan’s 5 Different Positions On The Sequester
House Republicans are attempting to blame Democrats and President Obama for “sequestration,” the automatic budget cuts that will begin taking effect on March 1 if Congress fails to avert them. But even as they cast that blame and ignore their own role in creation of the sequester, which wouldn’t exist had Republicans not refused to raise the debt ceiling in August 2011, Budget Committee Chairman Paul Ryan (R-WI) is expected to count the sequester’s automatic cuts in the next version of his budget, BuzzFeed reports:
According to two senior GOP aides familiar with Ryan’s thinking on the budget, the Wisconsin Republican and former vice presidential candidate will use the so-called sequester as part of the baseline level of spending for his budget.
Ryan’s position on the sequester has changed multiple times:
1. Helped make the sequester happen. Ryan was among the Republicans leading demands for spending cuts to offset a debt ceiling increase in the summer of 2011, and was among the leaders who refused to consider new revenues in those negotiations. Had Republicans not refused to raise the debt ceiling in the first place, the sequester wouldn’t exist.
2. Voted for plan to create the sequester, then bragged about it. Ryan took credit for the sequester in August 2011, bragging to Fox News that it guaranteed the massive budget cuts Republicans were seeking. “We got that in law,” he boasted. On the House floor, he said the Budget Control Act’s spending cuts were “a victory for those committed to controlling government spending.”
3. Called the sequester “devastating” during the presidential election. Ryan blasted Obama for wanting the sequester’s “devastating defense cuts” to take place during the presidential election, when he was the GOP’s vice presidential candidate.
4. Blamed the likelihood of the sequester occurring on Obama. The sequester “will probably occur” because “the president has not a proposal yet on the table,” Ryan told CBS News last week. “Don’t forget it’s the president who first proposed the sequester. It’s the president who designed the sequester as it is now designed,” he added.
5. Will include sequester cuts in his latest budget.
This is hardly a new strategy for Ryan, who crisscrossed the country blasting Obama for cutting Medicare spending even as he included the cuts in his last budget proposal and made even bigger changes to the program.
By: Travis Waldron, Think Progress, February 15, 2013
“Willfull Ignorance”: Short-term Memory Loss Grips Republicans In Washington
ABC News’ George Stephanopoulos devoted a good chuck of “This Week” to discussed automatic sequestration cuts yesterday, and asked Rep. Tom Cole (R-Okla.) for his prediction. The Republican congressman said President Obama came up with the sequester — a claim that simply isn’t true — before saying his caucus is “prepared to negotiate on redistributing the cuts.”
It led to this exchange:
STEPHANOPOULOS: And you’re saying all cuts. Republicans are accepting absolutely no revenues?
COLE: No. Look, absolutely none. The president’s accepted no spending cuts back in the fiscal cliff deal 45 days ago, so you get all — no spending cuts back then. Then you’re going to get no revenue now.
Around the same time, Sen. John McCain (R-Ariz.), who appears to spend more time on Sunday shows than in the Senate, said he’s open to some revenues as a way to replace the sequester, but added, “[W]e have raised taxes. Why do we have to raise taxes again?”
Of course, by that logic, there’s no reason not to ask, “We have cut spending. Why do we have to cut spending again?”
It’s troubling that Republican policymakers have such short memories, and seem to have no idea what policies they voted for as recently as 2011. It’s one of the more breathtaking examples of willful ignorance in recent memory.
But if we assume that lawmakers like Cole and McCain are sincere, and they literally can’t remember the basics of recent budget policy, then it’s probably worthwhile to set the record straight.
In 2011, Democrats and Republicans agreed to between $1.2 trillion and $1.5 trillion in spending cuts, depending on how one tallies the numbers. The cuts included no new revenue.
In 2012, Democrats and Republicans agreed to a deal that raised revenue by about $650 billion. The new revenue included no new cuts.
In 2013, Republicans are saying they remember what happened in 2012, but the 2011 policy has been blocked from memory.
This is crazy. Folks like Cole and McCain keep saying the 2012 deal didn’t include spending cuts, so the sequester has to be 100% in the GOP’s favor now, without exception. Why? Because Republicans haven’t gotten spending cuts.
Except they already did get spending cuts. Indeed, the cuts from 2011 were twice as big as the revenue from 2012.
Even if the parties agreed to an entirely balanced agreement this month to replace the sequester — roughly $600 billion in revenue and $600 billion in cuts — Republicans would still be getting the much better end of the deal. The total for the entire package, negotiated in parts over the course of two years, would be over $4 trillion in debt reduction — with a cuts-to-revenue ration of about six to one.
For that matter, Obama isn’t calling for “tax increases”; he’s calling for new revenue through closed tax loopholes and ending certain tax deductions. As recently as last month, Republican leaders said such a policy doesn’t count as a “tax increase,” though it’s suddenly become outrageous now that the president agrees.
This really isn’t that complicated. Either Republicans have a child’s understanding of fiscal policy, the memory capacity of a goldfish, or they think Americans are fools. At this point, I’m no longer sure which, though I’m open to suggestion.
By: Steve Benen, The Maddow Blog, February 11, 2013
“A Straightforward Factual Description”: Only One Party Is Willing To Compromise And It Isn’t The GOP
The difference between the Republican and Democratic positions on the sequester is simple: Democrats believe reaching a compromise is preferable to letting the sequester happen, since it could devastate the military and scuttle the recovery. Republicans believe letting the sequester happen is preferable to reaching a compromise, even though it could devastate the military and scuttle the recovery.
This is not a partisan observation. It is a straightforward factual description of the two sides’ positions and public statements. The Democratic position is that we must avert the sequester with a mix of new revenues and spending cuts — which is to say, a mix of what both sides want. The Republican position is that we must avert the deal only with spending cuts — which is to say, only with what Republicans want. Some Republicans are openly declaring that they will sooner allow the sequester to kick in than accept a compromise that includes revenue hikes. In other words, the sequester is preferable to any compromise that includes a mix of concessions by both sides. That’s their explicit position.
Indeed, Politico details this morning that many Republicans are holding to this position because they believe that they can blame Obama for the sequester. Roll Call adds that Mitch McConnell is urging Republicans to draw a hard line on the issue.
But given that polls show the public is already convinced Republicans are not doing enough to compromise with Obama, this position is not without risk to their side. So Republicans have tried to obscure the true nature of their stance in two ways.
One is to pretend they are the party that has made all the concessions to deficit reduction thus far. For instance, Charles Krauthammer argues today that Republicans should not give an inch on new revenues, because they already agreed to tax hikes as part of the fiscal cliff deal. Krauthammer doesn’t mention that Democrats agreed to $1.5 trillion in spending cuts — significantly more than the $700 billion in revenues Republicans agreed to — in 2011. Indeed, even if the parties agreed to a roughly one-to-one split between revenues and cuts to avert the sequester, the overall ledger would still be tilted towards Republicans.
The second way Republicans try to obscure the true nature of their position is by pretending Democrats aren’t willing to cut spending. But there’s that aforementioned $1.5 trillion that must not ever be discussed. What’s more, there is simply no question that if Republicans agreed to new revenues, Democrats would give Republicans at least as much, and likely more, in spending cuts. Yes, some liberals want Dems to refuse to offer any cuts. But the position of Democratic leaders, and even the President himself, is that spending cuts must be part of any deal. By contrast, the position held by the Tea Party wing of the GOP — no new revenues no matter what — is the position held by GOP leaders.
The problem for Republicans remains that they are on record saying that the sequester would devastate our military and are even on record saying it would scuttle the recovery. And so the current political situation is this: One side is willing to reach a compromise to avert disaster for the country; the other is not only unwilling to reach a compromise to avert disaster, it views the impending disaster as an opportunity to get what it wants and even sees it as preferable to compromise. This is an objectively true description of the two sides’ positions. If Republicans believe this is a political winner for them, then hey, go for it.
By: Greg Sargent, The Washington Post The Plum Line, February 8, 2013
“Kick That Can”: Fiscal Austerity Should Wait Until The Economy Has Recovered
John Boehner, the speaker of the House, claims to be exasperated. “At some point, Washington has to deal with its spending problem,” he said Wednesday. “I’ve watched them kick this can down the road for 22 years since I’ve been here. I’ve had enough of it. It’s time to act.”
Actually, Mr. Boehner needs to refresh his memory. During the first decade of his time in Congress, the U.S. government was doing just fine on the fiscal front. In particular, the ratio of federal debt to G.D.P. was a third lower when Bill Clinton left office than it was when he came in. It was only when George W. Bush arrived and squandered the Clinton surplus on tax cuts and unfunded wars that the budget outlook began deteriorating again.
But that’s a secondary issue. The key point is this: While it’s true that we will eventually need some combination of revenue increases and spending cuts to rein in the growth of U.S. government debt, now is very much not the time to act. Given the state we’re in, it would be irresponsible and destructive not to kick that can down the road.
Start with a basic point: Slashing government spending destroys jobs and causes the economy to shrink.
This really isn’t a debatable proposition at this point. The contractionary effects of fiscal austerity have been demonstrated by study after study and overwhelmingly confirmed by recent experience — for example, by the severe and continuing slump in Ireland, which was for a while touted as a shining example of responsible policy, or by the way the Cameron government’s turn to austerity derailed recovery in Britain.
Even Republicans admit, albeit selectively, that spending cuts hurt employment. Thus John McCain warned earlier this week that the defense cuts scheduled to happen under the budget sequester would cause the loss of a million jobs. It’s true that Republicans often seem to believe in “weaponized Keynesianism,” a doctrine under which military spending, and only military spending, creates jobs. But that is, of course, nonsense. By talking about job losses from defense cuts, the G.O.P. has already conceded the principle of the thing.
Still, won’t spending cuts (or tax increases) cost jobs whenever they take place, so we might as well bite the bullet now? The answer is no — given the state of our economy, this is a uniquely bad time for austerity.
One way to see this is to compare today’s economic situation with the environment prevailing during an earlier round of defense cuts: the big winding down of military spending in the late 1980s and early 1990s, following the end of the cold war. Those spending cuts destroyed jobs, too, with especially severe consequences in places like southern California that relied heavily on defense contracts. At the national level, however, the effects were softened by monetary policy: the Federal Reserve cut interest rates more or less in tandem with the spending cuts, helping to boost private spending and minimize the overall adverse effect.
Today, by contrast, we’re still living in the aftermath of the worst financial crisis since the Great Depression, and the Fed, in its effort to fight the slump, has already cut interest rates as far as it can — basically to zero. So the Fed can’t blunt the job-destroying effects of spending cuts, which would hit with full force.
The point, again, is that now is very much not the time to act; fiscal austerity should wait until the economy has recovered, and the Fed can once again cushion the impact.
But aren’t we facing a fiscal crisis? No, not at all. The federal government can borrow more cheaply than at almost any point in history, and medium-term forecasts, like the 10-year projections released Tuesday by the Congressional Budget Office, are distinctly not alarming. Yes, there’s a long-term fiscal problem, but it’s not urgent that we resolve that long-term problem right now. The alleged fiscal crisis exists only in the minds of Beltway insiders.
Still, even if we should put off spending cuts for now, wouldn’t it be a good thing if our politicians could simultaneously agree on a long-term fiscal plan? Indeed, it would. It would also be a good thing if we had peace on earth and universal marital fidelity. In the real world, Republican senators are saying that the situation is desperate — but not desperate enough to justify even a penny in additional taxes. Do these sound like men ready and willing to reach a grand fiscal bargain?
Realistically, we’re not going to resolve our long-run fiscal issues any time soon, which is O.K. — not ideal, but nothing terrible will happen if we don’t fix everything this year. Meanwhile, we face the imminent threat of severe economic damage from short-term spending cuts.
So we should avoid that damage by kicking the can down the road. It’s the responsible thing to do.
By: Paul Krugman, Op-Ed Columnist, The New York Times, February 7, 2013
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