Republicans and a dozen Democratic defectors in the Senate dealt a defeat to President Barack Obama Wednesday, just days after he pressed Congress to renew pieces of last year's economic stimulus bill.
This bill included an extension of unemployment benefits, and aid to states to help keep teachers, firefights and police employed. The bill also would have raised taxes on hedge fund managers and other wealthy investors who pay far lower rates than others on their income. And it would boost taxes a bit on oil companies. God forbid!
This comes after previous attempts to help the jobless failed over spending concerns (and never mind efforts to create jobs),
Democrats had already scaled back the bill after colleagues complained a previous draft would have cost almost $200 billion. House Democratic leaders last month dropped plans to extend subsidies to help the jobless buy health insurance and send another $24 billion to states before forwarding the measure to the Senate.
Senator Claire McCaskill, a Missouri Democrat, said lawmakers want to begin paring the extended unemployment benefits created in response to the recession because "this is not something that can go on indefinitely."
McCaskill said that "if you don't start having those discussions then it begins to look like a brand-new level of entitlement program, which is something that we really can't afford to do right now in this country."
Finance Committee Chairman Max Baucus says the Senate will now present a "less costly" plan" that will cost the states, the poor and the unemployes a lot more.
Bush left us with a $1.4 trillion deficit, and the unemployed and poor are paying for that. Part of the problem is that conservatives have been successful at misleading the public into thinking this huge deficit was the result of Obama's stimulus when it wasn't. (The public also conflates the stimulus with the Bush banker bailouts.)
With the election looming this misperception puts the heat on Democrats who didn't get the Cheney message that "Reagan proved deficits don't matter." They are putting themselves in the role of taking the candy away -- and hurting the unemployed and poor, while risking tipping the economy back into recession. They think this will help them in the election. Republicans are barely able to keep their snickering to themselves.
Outside of the DC bubble it is clear that the Republican strategy is to cause economic pain, and then run against Democrats for causing economic pain. And this is exactly what they are doing. (Similar to the strategy of blocking everything the Congress does, and then running a campaign of "Democrats aren't getting anything done so vote for us.")
Oh, the irony. As Defense Secretary Robert Gates was on Capitol Hill today telling a Senate appropriations subcommittee that Congress has to approve a $33 billion supplemental war funding request by July 4 or else "we begin to have to do stupid things," the Senate did an incredibly stupid thing itself: By a vote of 45 to 52, it blocked a spending and tax measure that if enacted would prevent the loss of hundreds of thousands of jobs nationwide and would begin to close a particularly egregious tax loophole.
Once again, a majority of the Senate has placed trying to use whipped-up fear of growing deficits to protect their own jobs over aggressive action to create and protect jobs for the American people.
Later he really makes the point, writing,
Critics say that the measure would add $80 billion to the federal deficit. But what do we lose when 900,000 people who are teaching our children, protecting our lives and property, maintaining our public spaces and serving us in innumerable other ways are unemployed?
As for the failure to extend the COBRA subsidies, almost half of the long-term unemployed are older workers, likely shed from companies because of their age, which means they have higher health care costs and are paid more because of their experience. Now they are losing their COBRA subsidies which means almost all lose health care. The very people who need government the most, the unemployed and older people, and the very ones the Congress is taking things out on.
This is a travesty and the Democrats are falling into a trap. The public is going to take it out on them, not reward them, if they don't start watching out for working people.