As we approach the centenial of Reagan's birth, conservatives are whipping up the country into a frenzy of addled adulation. It's time for a bit of a reality check. Yesterday, in my diary, "History repeating itself ", I briefly touched on the fact that the fall of the Soviet Union--which he is widely credited for--was not only a surprise to Reagan's CIA, it was arguably delayed by his war-like posture strengthening Soviet hardliners, which in turn was premised on the baseless neocon fantasy that the Soviets were militarily superior to us when Reagan took office. That's an area in which there are some very clear-cut facts and some things that are more debatable.
But when it comes to Reagan's economic legacy, the record is crystal clear: Before Reagan, we were on a path on reducing our debt-to-GDP ratio, the most fundamental measure of national fiscal responsibility. With him, we began using irresponsible increases in the debt-to-GDP ratio to produce extremely skewed economic growth targeted narrowly toward the very top of the income ladder. The so-called "Reagan miracle" is a complete and utter myth, as one can see from these simple comparisons of basic economic growth statistics. As one can readily see, the 1970s were a troubled decade compared to the 1960s, but we still managed to keep reducting our debt-to-GDP ratio. Then Reagan came along, and gave us a junk-food "cure" that was only marginally better in terms of GDP growth and income growth for the bottom 99%, was actually worse in terms of job creation, and showered the top 1% with wealth--at the very time that their taxes were being slashed as never before:
Reagan's policies--modified slightly under Clinton, and put on steroids under GW Bush--are the root cause of the economic distress we are experiencing today. And the newsletter Too Much has the goods on the root of Reagan's selfishness that helped lead our nation astray economically:
The Tax that Turned Ronald Reagan Right
With the centennial of our 40th President's birth fast approaching, how about a shout-out for the soak-the-rich tax rates that he so despised - and more civic-minded Hollywood stars so enthusiastically embraced.
Did Ronald Reagan change history? Well, we all change history in our own way. The more interesting question: What changed Ronald Reagan?
What changed the labor advocate - with enough street cred to get elected president of Hollywood's actors union - into a labor basher extraordinaire? What turned Reagan the standard-issue New Deal Democrat into the 20th century's premiere pusher for almost entirely unrestrained "free enterprise"?
The answer? According to Reagan himself, the federal income tax - specifically the over 90 percent top rate on top-bracket income that went into effect during World War II - changed Ronald Reagan. That tax levy absolutely incensed the amiable actor.
At his Hollywood height, actor Ronnie Reagan was making $400,000 per picture. With the top federal tax rate over 90 percent, Reagan used to tell his White House chief of staff Donald Regan, he always chose to "loaf" around rather than make more than two pictures a year.
"Why should I have done a third picture, even if it was Gone with the Wind?" Regan remembers Reagan asking. "What good would it have done me?"
Actually, instead of griping about his tax bill, the World War II-era Ronnie Reagan should have been counting his lucky tax stars. Things could have turned out much worse for Reagan - and the rest of America's high-income set - if Congress had let President Franklin D. Roosevelt have his way.
In April 1942, just a few months after Pearl Harbor, Roosevelt asked Congress to enact a 100 percent top federal income tax rate, in effect a "maximum wage." No individual, FDR told lawmakers, should be taking home, after taxes, over $25,000 - the equivalent of about $335,000 today.
FDR's call for a $25,000 personal income limit struck millions of patriotic Americans as right on the mark. A Gallup poll, in late 1942, found 47 percent of Americans supporting the notion of an income limit and only 38 percent in opposition. And the supporters of FDR's $25,000 cap even included some of Ronnie Reagan's fellow Hollywood stars.
"I regret," the widely admired Ann Sheridan told reporters, "that I have only one salary to give for my country." ....
Obama's first public political speech, at Occidental College on February 18, 1981, was delivered in opposition to apartheid, and in support of the divestment movement. (The Bridge: The Life and Rise of Barack Obama by David Remnick [pp 109-110].)
"There's a struggle going on!" he said, "A struggle that demands we choose sides. Not between black and white. Not between rich and poor. No--it's a harder choice than that. It's a choice between dignity and servitude. Between fairness and injustice. Between commitment and indifference. A choice between right and wrong."
As the divestment movement grew, Ronald Reagan developed a counter-strategy, known as "constructive engagement", which was overtly supposed to counter apartheid, but was actually intended to counter the divestment movement.
While Obama and Reagan were on opposite sides way back when, things have changed a lot since then. South African apartheid is long gone from the international scene, but something disturbingly similar has emerged in Israel, with illegal Israeli settlements and pass laws turning occupied Palestine into a near-perfect replica of apartheid-era South Africa--hardly a surprising outcome, given that Israel was long South Africa's leading supporter, even helping out with its nuclear program. And Egypt is Israel's prime enabler in the region, supported by $1.3 billion in US military aid, as the historic peace treaty brokered by Jimmy Carter has become a means for creating a condition of unspeakable evil--about which, of course, America says nothing. (Hence, unspeakable.) What's more, as WikiLeaks cables revealed, in UK Guardian coverage last Friday, the US was well aware of routine torture in Egypt ("US reported 'routine' police brutality in Egypt, WikiLeaks cables show"), but wanted to keep on Egypt's good side ("WikiLeaks cables show close US relationship with Egyptian president").
The sharp contrast of endless kind words in public, and stark assessments of brutality in the cables serves to underscore why the Obama Administrations "nuanced" public statements are far more popular with the conservative Versailles punditalkcrazy than they are with the Egyptian people in the street, who find Obama to be unconvincing in his role of would-be champion of democracy and human rights. Indeed, it's only a secret here in heavily-propagandized America that the entire Mideast order is based on coercion--military force, secret police, and intelligence agencies that routinely employ torture. Israel's "democracy" is free to drift farther and farther into delusional rightwing fantasies thanks to our support and the collusion of Arab dictatorships. Nothing there could be remotely similar if it needed democratic foundations and the consent of the governed--all of the governed--to survive.
1. (C) Summary and comment: Police brutality in Egypt against common criminals is routine and pervasive. Contacts describe the police using force to extract confessions from criminals as a daily event, resulting from poor training and understaffing. Brutality against Islamist detainees has reportedly decreased overall, but security forces still resort to torturing Muslim Brotherhood activists who are deemed to pose a political threat. Over the past five years, the government has stopped denying that torture exists, and since late 2007 courts have sentenced approximately 15 police officers to prison terms for torture and killings.
Independent NGOs have criticized GOE-led efforts to provide human rights training for the police as ineffective and lacking political will. The GOE has not yet made a serious effort to transform the police from an instrument of regime power into a public service institution. We want to continue a USG-funded police training program (ref F), and to look for other ways to help the GOE address police brutality.
That last bolded sentence is the very essence of "constructive engagement." As the main text of the cable makes clear, there is no real interest in actual reform, motivated by respect for human rights. Instead, to the extent there is any insterest at all in change, it is an interest in minimizing friction, and targeting torture victims more carefully. Thus, it's only when Muslim Brotherhood members get involved in political matters that they can expect to be tortured. The cable continues:
The Theory Into Practice section starts to sound more like the president we all know and ... well, know:
In Obama's mind, his election was not an endorsement of the outsize government role that Reagan battled - bureaucratic, ever expanding, self-interested - but a cry for government that could carry out its basic missions more effectively. "I think what you're seeing is a correction to the correction," Obama explained.
That one quote sums up Obama perfectly. The "correction to the correction" fundamentally assumes that Reagan was correct, but just overshot. The writers use of words sounds resonant with Obama as well, as it limits government to its "basic missions" but only asks to be more effective.
That's neoliberalism defined, right there.
To this, I would only add that this didn't have to be so. The neo-liberals are not so much a "correction to the correction" in the way they think they are--guided by pragmatism--as they are guided by an anti-leftist ideology that shares far more in common with the right than they can ever admit. Indeed, one can distinguish between the two by looking at welfare reform, and contrasting Clinton's original intent with what he ended up signing onto. The original intent was somewhat of a concession to rightwing attacks on welfare, but it was also (1) a recognition that with women's role in workforce drastically expanded the underlying assumption of welfare that mothers did not work was no longer valid and (2) an attempt to make the transition in a relatively non-punitive way that had a genuine interest in empowering women to successfully move out of poverty. This is not what Clinton ended up signing, although his vast expansion of the earned income tax credit and the writing of the implementation rules after the law was passed both served to mitigate some of the harsher effects, as did the relatively strong economy.
If all of Clinton's policies had been similarly conceived in terms of realistic considerations, if they had not been compromised with conservatives, and if they had been modified over time to correct shortcomings as they became obvious, then this sort of "correction to the correction" could have genuinely claimed to be pragmatic. But of course, it was not. The failings of NAFTA, for example, never got corrected--and they were pretty much all foreseen in advance by its opponents and critics. The same for financial deregulation. The reality of neo-liberalism--as opposed to its PR-assured that it would be so. In comments yesterday, I was asked to define neo-liberalism, and after quoting from I quoted from a Wikileaks for a basic definition:
Neoliberalism describes a market-driven[1] approach to economic and social policy based on neoclassical theories of economics that stresses the efficiency of private enterprise, liberalized trade and relatively open markets, and therefore seeks to maximize the role of the private sector in determining the political and economic priorities of the state.
The term "neoliberalism" has also come into wide use in cultural studies to describe an internationally prevailing ideological paradigm that leads to social, cultural, and political practices and policies that use the language of markets, efficiency, consumer choice, transactional thinking and individual autonomy to shift risk from governments and corporations onto individuals and to extend this kind of market logic into the realm of social and affective relationships
I went on to flesh it out by quoting from Corpwatch:
Back on December 9th, in a post entitled "Fox Fair and Balanced" on Health Care Debate.....NOT!" I pointed out how the Fox News Network had deliberately tried to skew the national discussion on health care reform in such a way as to discredit the concept of a public option. Well just yesterday The Saint Petersburg Times' Pulitzer Prize winning affiliate, PolitiFact.com published:"PolitiFact's Lie of the Year: 'A Government Takeover of Health Care". This article pointed out how, when the facts are objectively analyzed, that for all of the rhetoric surrounding health care reform as being Socialist, it was in fact far from it .
Well with the health care debate behind us and with those facts on the table, the folks at PolitiFact's.com have detailed the inaccuracies of this conservative claim, labeling it the political lie of 2010. This falsehood was second only to Michele Bachmann's bizarrely absurd claim that Barack Obama's trip to India would cost 200 Million Dollars a day. Politifact.com deconstructs the logic behind the argument that "ObamaCare" represents a "government takeover of health care" with the following facts:
"Government takeover" conjures a European approach where the government owns the hospitals and the doctors are public employees. But the law Congress passed, parts of which have already gone into effect, relies largely on the free market:
• Employers will continue to provide health insurance to the majority of Americans through private insurance companies.
• Contrary to the claim, more people will get private health coverage. The law sets up "exchanges" where private insurers will compete to provide coverage to people who don't have it.
• The government will not seize control of hospitals or nationalize doctors.
• The law does not include the public option, a government-run insurance plan that would have competed with private insurers.
• The law gives tax credits to people who have difficulty affording insurance, so they can buy their coverage from private providers on the exchange. But here too, the approach relies on a free market with regulations, not socialized medicine.
PolitiFact reporters have studied the 906-page bill and interviewed independent health care experts. We have concluded it is inaccurate to call the plan a government takeover because it relies largely on the existing system of health coverage provided by employers.
It's true that the law does significantly increase government regulation of health insurers. But it is, at its heart, a system that relies on private companies and the free market."
This very argument was raised last February when the renowned health care economist Uwe Reinhardt published an article entitled: "A Government Takeover of Health Care? Reinhardt came to the following conclusion: "A common refrain among critics of the health reform bills passed by the House and the Senate is that they constitute a "complete government takeover of 17 percent of the American economy."How could this be so? Start with the $950 billion price tag over the next decade for federal subsidies toward the purchase of private health insurance. Divide that amount by $34 trillion, the current projection for total national health spending over the next decade even in the absence of health reform. You will get 2.8 percent. Does that, then, constitute a government takeover of our health system?" Reinhardt concluded that the proposed reforms at the time, while certainly representing a major intrusion by the Federal Government into the health care process, were necessary as the system was "wasteful and unwieldy" and "would require substantial intrusion of government into the system, as evidently the system cannot correct itself."
Thus with the benefit of hindsight and with the 2010 elections where "ObamaCare" was certainly a topic of discussion now history, the question arises: To what extent have the American people been misled, if not outright bamboozled by the ultra right campaign against health care reform and it's conflating of that topic with the conjured up "specter of creeping Socialism?" To my mind the conservative attack on health care reform fits very neatly into a pattern of history that stretches all the way back to Theodore Roosevelt's first mention of the need for some type of national health care system. Since that time, health care reform has dovetailed neatly into more than one of the "red scares" that have accompanied this debate and that of progressive reform in general. Then like now, health care reform was seen as something that was tied to a decline of freedom in America and its replacement with that European import labeled "Socialism." Remember how Ronald Reagan once told us that the enactment of Medicare would bring about the decline of freedom in America and how we would all one day tell our grandchildren what it was once like to live in a free country? And just like then, these claims have now been proven by facts to be far fetched at best and fictitious at the very worst. Thus have those Americans who bought into this rhetoric of fiction and fear become nothing more than the "useful idiots' for those on the far right who have a vested interest in the status quo? Have they in so doing sacrificed their own best interests so as to avoid a "Socialist" threat that doesn't even exist in today's America? Or, have just so many Americans become fooled by the likes of Glenn Beck and Rush Limbaugh as to be unable to distinguish fact from fantasy and what does that say about the future of American Democracy?
Tax policy and tax cuts in particular are elements central to the Republican Party's economic philosophy. Republicans have made tax cuts one of their primary tools for fighting the Great Recession and returning America to prosperity. When advocating cuts, many on the Right have waxed nostalgic for the Reagan era tax cuts and their supposed economic benefits. The "record" of those cuts is held up as a justification for extending the Bush tax cuts beyond their expiration date and likewise for cutting taxes generally. All of this as an ideological counterpoint to what the Obama Administration has done in addressing the current downturn. Thus when economists who describe themselves as free market advocates, Libertarians, Republicans and even conservatives call extending the Bush era tax cuts into question one can only take note and inquire further as to why those whom we would expect to endorse tax cuts count themselves among the opposition.
Opposition to extending the tax cuts of the Bush Administration falls generally into two different schools of thought. In one camp you have people like Alan Greenspan and David Stockman the former Director of OMB during the Reagan years, both of whom argue that tax cuts are being supplemented by foreign borrowing and are as such unwarranted. In another camp you have people like Bill Gross of PIMCO and former Bush Administration economist Glenn Hubbard who support more federal spending due to the severity of the current downturn. Appearing on Meet the Press on August 1st Greenspan voiced opposition to the idea of tax cuts combined with continued borrowing. He reinforced this point in a New York Times interview the next week that stated: "Mr. Greenspan is calling for the complete repeal of the 2001 and 2003 tax cuts, brushing aside the arguments of Republicans and even a few Democrats that doing so could threaten the already shaky economic recovery." Greenspan went on to point out that tax cuts are appropriate when the government is running a surplus and that his original support of tax cuts was combined with other economic requirements that were ignored by economic policy makers within the Bush Administration. A far more scathing condemnation of the Republican Party, it's economic performance and it's fixation with tax cuts was voiced by David Stockman in two separate pieces: "Bush Tax Cuts Will Make U.S. Bankrupt" and "Four Deformations of the Apocalypse". Quoting Stockman: "Yes, there was a good idea that in certain circumstances, lower tax rates will encourage economic activity and savings. But when you make it a religion, when you make it a catechism and you say you cut taxes no matter what the circumstance, what the season, what the condition, then I think the whole idea has been perverted...I find it unconscionable that the Republican leadership faced with a 1.5 trillion deficit could possibly believe that good public policy is to maintain tax cuts for the top 2 percent of the population who, after all, have benefited enormously from this phony boom we've had over the last 10 years as a result of the casino on Wall Street." Stockman goes on to analyze the four deformations of the American economy that he says resulted from Republican policies that abrogated the Bretton Woods Agreement, the exportation of jobs overseas, the hyper-growth of the financial sector and the explosion of public debt. Yet it is in addressing the growth of public debt that Stockman is especially harsh in analyzing the Republican policies both during the Reagan era and beyond. Again to the author: "This debt explosion has resulted not from big spending by the Democrats, but instead the Republican Party's embrace, about three decades ago, of the insidious doctrine that deficits don't matter if they result from tax cuts."
The alternate point of view is put forth by those who see the economy as being so structurally unsound that no amount of tax cuts will help and that only massive public works projects and spending on retraining will provide the necessary remedial aid the economy requires. Bill Gross the fixed income guru of PIMCO was interviewed for an article in the New York Times by Nelson Schwartz, "Jobless and Staying that Way" with the following takeaway: "Despite his long-held belief in free markets, smaller government and lower taxes, Mr. Gross said politicians must recognize that this time, "government is part of the solution." He added, "In the new-normal world, there are structural problems, which require structural solutions... Mr. Gross believes that it's time for the government to spend tens of billions on new infrastructure projects to put people to work and stimulate demand." Quoting Gross: "We think the coma will last for years unless government policy changes to restimulate the private sector and bring unemployment down," In the same camp is former Bush economic advisor Glenn Hubbard who stresses a new, expanded role for the government in addressing the problem of structural unemployment. He talks about a "new normal," where economic growth is too slow to bring down the unemployment rate which in turn requires the government to be more actively involved in mitigating problems that now emerge as the result of globalization. In Hubbard's words: "If there is a new normal, it's more about the labor market than G.D.P. "We have to help people face a new world."
In contrast, the Republican Party continues to talk about the current downturn as if it were a garden variety economic contraction that could be dealt with through tools and policies related thereto. It continues to advocate tax cuts as if they would somehow create consumer demand where it currently doesn't exist. Conservatives have repeatedly pointed to the Reagan era tax cuts as a prime example of the efficacy of such measures in stimulating demand and at the same time they have ignored the massive Reagan era stimulus provided by military spending. In a recent article titled "Unemployment: What Would Reagan Do? Henry Olsen of the American Enterprise Institute talked extensively of Reagan's tax cuts but mentioned not a word of his spending. To paraphrase the source "Reaganomics" below: "Reagan very significantly increased public expenditure, primarily the Department of Defense, which rose from $267.1 billion in 1980 to $393.1 billion in 1988." That meant that "defense spending went from being 22.7% to 27.3% of total public spending. In order to cover new federal budget deficits, the United States borrowed heavily both domestically and abroad, raising the national debt from $700 billion to $3 trillion, and the United States moved from being the world's largest international creditor to the world's largest debtor nation." Beyond spending for military goods, Reagan expanded the size of the federal government creating a new cabinet level department and presiding over a federal workforce that was larger when he left office than it was when he arrived. Economist Robert Reich points out the fallacy of the Reagan era tax cuts as follows:" Unfortunately for supply-siders, history has proven them wrong again and again. During almost three decades spanning 1951 to 1980, when America's top marginal tax rate was between 70 and 92 percent, the nation's average annual growth was 3.7 percent. But between 1983 and start of the Great Recession, when the top rate was far lower -- ranging between 35 and 39 percent -- the economy grew an average of just 3 percent per year. Supply-siders are fond of claiming that Ronald Reagan's 1981 cuts caused the 1980s economic boom. In fact, that boom followed Reagan's 1982 tax increase." An analysis from the Center on Budget and Policy Priorities argues that "history shows that the large reductions in income tax rates in 1981 were followed by abnormally slow growth in income tax receipts, while the increases in income-tax rates enacted in 1990 and 1993 were followed by sizeable growth in income-tax receipts." Specifically, the analysis calculated that the average annual growth rate of real income-tax receipts per working-age person was 0.2% from 1981 to 1990 and a much higher 3.1% from 1990 to 2001. Thus if you want to find the wellspring of economic growth in the Reagan era you won't find it in tax policy, ironically it can be found in simulative spending for military hardware and the growth in federal employment.
In their constant baying "Where are the jobs?" the Republican leadership on Capitol Hill has ignored the fact that the present downturn is far more severe than their rhetoric would allow. In analyzing the current downturn Sara Murray points out:" GDP was revised down in seven of the 12 quarters of 2007, 2008 and 2009, primarily because consumer spending grew more slowly and home building fell more sharply than previously estimated...The overall depth of the latest recession surpassed that of any other downturn since the late 1940s. GDP fell by 4.1% from the fourth quarter of 2007, when the recession officially began, to the second quarter of 2009, when many economists believe it ended. The previous estimate for the peak-to-trough decline was 3.7%...The new data show that the worst of the recession came in the last quarter of 2008." With economic utilization rates down by 30% across much of the economy and manufacturing output off 28% in the U.S. and 23% worldwide and with services down significantly as well, it was more than evident that tax cuts could not restart the world economy and that is why they were not a major element in the initial policy response in any major economy. The value of government action has been outlined by Jon Hilsenrath as follows: "Most mainstream economists agree on some points: The U.S. economy needed some kind of fiscal help in 2009 as the financial system teetered and the Federal Reserve pushed interest rates near zero. The deficit has to be reined in eventually, in part by restraining the growth of spending on health and other benefits. And developing a long-term plan to do so now would reduce risks of a future financial market calamity and help hold interest rates down... But today, neither side can say with certainty whether the latest stimulus worked, because nobody knows what would have happened in its absence...One big issue: Lessons about fiscal policy in normal times aren't necessarily applicable to today, when the Fed has cut interest rates to zero and unemployment remains high. Skeptics of fiscal stimulus traditionally argue that government borrowing crowds out private investment and pushes up long-term interest rates. True, says Obama adviser Lawrence Summers, but not at times like these...When private-sector lending was drying up and the credit markets froze, "government investment and creation of demand for consumers was a form of alternative financing, not a threat to private investment," Likewise, David Wessel author of "In Fed We Trust" notes: "Government, which did fail to head off the crisis, saved us from an even worse outcome... But we know now that the economy was imploding in late 2008. We know now with detail how paralyzed financial markets were, and how rotten were the foundations of some big banks. We know now that even after all the Fed has done, we still risk devastating deflation... So the short answer has to be: Yes, it would have been far worse had the government failed to act." The factors that affect unemployment predate the Obama Administration as the economic downturn started roughly a year before he took office and you can see unemployment starting to rise in the last quarter of 2008. One could make the argument that the stimulus has been far less effective in getting people back to work than one would hope, but there is little reason or historical evidence at hand to lead to the conclusion that we would have done better by employing tax cuts. Some conservatives would point to Calvin Coolidge's tax policies in fighting the 1920-1921 downturn as evidence that these policies work, but in doing so the avoid the influence of sharp tariffs that were also part and parcel of his response and the negative chain reaction that ensued worldwide as a result. Besides, what was the follow on act to the Roaring 20s, the Great Depression.
In analyzing the effect of the controversy surrounding stimulus verses tax cuts on the recessionary economy, Jon Hilsenrath states:" Tax cuts haven't been a cure-all. President Bush tried $168 billion of tax rebates in 2008, and a recession ensued anyhow. Economists note that households tend to save temporary tax cuts or use them to pay down debt, so they don't provide much short-term stimulus." Hilsenrath goes on to point out that one third of the Obama stimulus was in the form of tax cuts. This fact has also been pointed out by Steve Weisman of the Petersen Institute for International Economics who has stated that the tax cuts included in the stimulus have had zero simulative effect. There is now evidence that business is starting to spend money on capital goods regardless of the specifics of tax policy. Nomura Securities economist David Resler calculates "that businesses didn't spend enough in 2009 on new equipment to offset the wear and tear on their existing equipment...Mr. Resler estimates that even with the recent sharp increases in capital spending, the total capital stock is still $100 billion less than it was two years ago. That suggests that capital spending could continue to grow strongly the rest of the year." Mr. Greenspan himself added that the relationship between taxation and growth was still not well understood. "I don't think anybody can know exactly what the impact of these taxes is on G.D.P.," he said, referring to gross domestic product, the broadest measure of output. "We put them through econometric models that have a very poor record forecasting recession. Conclusions based on such models must be suspect." The fact of the matter is that companies spend money on replacement and expansion when they see an economic reason to do so, not primarily as a result of tax policy. While tax incentives for plant and equipment can be helpful, they alone are not enough to give rise to business spending if there is a perceived lack of demand for a firm's goods or services. After all, companies still have to lay out millions of dollars in expenditure and why would they do so if they have idle capacity to the tune of 30%?
So the question is this; if so many influential people are pointing to the lack of effectiveness of tax cuts in this particular economic environment, why do Republicans cling so desperately to the idea? As I have said in earlier articles, I believe that, in a large part, the G.O.P. is at the point of ideological exhaustion and is sorely lacking when it comes to new and compelling ideas. It is basically, with few exceptions, pushing old wine in old bottles. Their one big exception is Congressman Paul Ryan's " A Roadmap For America's Future", which contains a number of tax reform ideas and advocates for a privatization of Social Security, a tall order to fill in this environment and one that Republicans could not pull off during the Bush Administration when they had control of the presidency and both houses of Congress. Ryan's plan has been picked apart by Economist Paul Krugman for what he claims are its faulty assumptions. One is Ryan's claim that based on OMB estimates; his policies would cut the budget deficit in half by 2020. Krugman's critique is as follows: "But the budget office has done no such thing. At Mr. Ryan's request, it produced an estimate of the budget effects of his proposed spending cuts - period. It didn't address the revenue losses from his tax cuts... The nonpartisan Tax Policy Center has... Its numbers indicate that the Ryan plan would reduce revenue by almost $4 trillion over the next decade. If you add these revenue losses to the numbers... you get a much larger deficit in 2020, roughly $1.3 trillion. And that's about the same as the budget office's estimate of the 2020 deficit under the Obama administration's plans...The Tax Policy Center finds that the Ryan plan would cut taxes on the richest 1 percent of the population in half, giving them 117 percent of the plan's total tax cuts... Even as it slashed taxes at the top, the plan would raise taxes for 95 percent of the population...Finally; let's talk about those spending cuts. In its first decade, most of the alleged savings in the Ryan plan come from assuming zero dollar growth in domestic discretionary spending, which includes everything from energy policy to education to the court system. This would amount to a 25 percent cut once you adjust for inflation and population growth. How would such a severe cut be achieved? What specific programs would be slashed? Mr. Ryan doesn't say."
There is a curious lack of candor and directness among Republican leaders making the rounds on the political talk show circuit when it comes to detailing specifics. Appearing on the Bloomberg network, Senator Mitch McConnell (R-KY) declined to outline what comprised the G.O.P.'s political or economic platform for the 2010 election cycle saying he "did not want to scoop himself". A week later in an August 8th Meet the Press interview, John Boehner (R-OH) would not provide specifics on the same topic choosing to talk around the issue by saying that the G.O.P. was "still listening to the American people." That's a sharp contrast to Mr. Boehner's comments on Meet the Press this past January when he said: "Leadership is about standing on principles and offering alternative policy solutions" The fact of the matter is that if they were in power now, they would most likely have favored simulative spending as well as there is no historical evidence that tax cuts alone, or as a primary strategy, has ever pulled an economy out of a downturn as deep as this one. They certainly can't harken back to the business friendly 19th century America as taxes then were low or nonexistent on economic activity as well as personal incomes. And interestingly enough, Senator McConnell appearing again on Meet the Press, 22nd of August, was unwilling or unable to come up with an answer as to how to pay for extending the Bush era tax cuts as well as answer the question of the viability of Congressman Ryan's Roadmap. As per the moderator, David Gregory's take on the Ryan plan: "it lays out some Draconian steps to balance the budget, to cut spending in both Social Security and Medicare. I'm wondering why it is if Republican leaders are so serious about cutting the deficit and cutting spending, why there aren't more than 13 cosponsors in the United States Congress for this plan?" Somehow the new found fiscal rectitude of the G.O.P. seems to ring hollow when you consider that much of the present Republican leadership on Capitol Hill are the same culprits who took this country from surplus to deficit and endorsed a military misadventure that has by now cost over one trillion dollars that would have been better spent here fighting the downturn.
Perhaps it is this lack of compelling new ideas in the midst of the worst downturn since the 1930s that has led the G.O.P. to basically avoid policy specifics and let the far right media fringe do much of the talking for the Party. Perhaps that is why so little is known about the ideas of a Paul Ryan, he can't be heard over the roar and din of the fanatics on the far Right and the political theater of people like Newt Gingrich, Rush Limbaugh, Glenn Beck and the rest of the entertainers on the right who pawn themseleves off as legitimate news analysts. Perhaps that is why many of its leading figures have been so enmeshed in the Ground Zero Mosque controversy or perhaps why they have let the "Birther Mania" run wild and unabated. After all, if you don't have compelling ideas to offer voters in general, you're left with having to rile up the base and keep them engaged no matter what the method or the reasoning. Columnist David Brooks addresses this as part and parcel of the lack of civil public discourse currently gripping the nation in his latest op-ed "Case of Mental Courage":"Many conservatives declare that Barack Obama is a Muslim because it feels so good to say so. Many liberals would never ask themselves why they were so wrong about the surge in Iraq while George Bush was so right. The question is too uncomfortable...There's a seller's market in ideologies that gives people a chance to feel victimized. There's rigidity to political debate. Issues like tax cuts and the size of government, which should be shaped by circumstances (often it's good to cut taxes; sometimes it's necessary to raise them), are now treated as inflexible tests of tribal purity." While the Republican Party will surely make gains in the 2010 election cycle, it will be a function of the natural progression of electoral cycles rather than the start of a renaissance. We are now in a brave new world of globalized economic competition where military power may very well play a diminished role. No amount of tax cutting will help us in combating the cost of production in China and the Far East. We are in need of bold new ideas and to date, the Republicans have largely offered an agenda of obstruction and out of date economic concepts that proved lacking in the 19th Century as well as in 2008. Generally the voters still blame the Bush Administration for the current economic disaster and the G.O.P. remains at historic lows in favorability ratings. In spite of the fact that some 30% of the voters identify as conservative, the long term demographics are trending against the G.O.P. and its core philosophy and at some point it will either have to redefine its reason for being or it will have to accept a role as the default party of American politics.
AUGUST 11, 2010.Grim Voter Mood Turns Grimmer: Pessimism Rises on Economy and War; Bad Reviews for Both Democrats and GOPhttp://online.wsj.com/article_email/SB10001424052748704901104575423674269169684-lMyQjAxMTAwMDEwMTExNDEyWj.html#articleTabs%3Dinteractive
During Netroots Nation, we are running Golden Oldies plus a few surprises. Regularly Scheduled programming will resume on July 26.
A Paul Rosenberg Golden Oldie
From Sun Jan 20, 2008. Original HERE.
I had a wonderful post on this subject, what got et when the site went down yesterday. It did go down, didn't it? It wasn't just me? So you'll just have to make do with this vastly inferior version.
Regardless of his intentions, Obama has been doing a pretty good job of splitting the left for some time now. Secular humanists, peace activists, Boomers, gays, all have had their turns feeling particularly spurned, while his version of triangulation has many even more nervous than the Clinton version made them. Many think he's got the perscription exactly backwards-Democrats don't suffer from being too much like the always-combatative Republicans, but from being too wimpy, too reluctant to stand up and fight for what they belive. And many think that now's not the time to reach out with a hand of friendship, just when they're sinking like a stone.
In this diary, I'm not going to try to solve all the differences just mentioned. Rather, I'm just going to look at one prominent example from the last week, and look at how it could have been handled differently, so that the divisions generated would have been among conservatives, not progressives. It's a very logical strategy to pursue on two counts: First, as a progressive, Obama should naturally want to unify progressives. Second, given that only some conservatives are genuinely interested in cooperation, while others are dedicated to oppostion, it makes perfect sense to reach out specifically to those who are reachable in a way that clarifies their differences from those who are not.
I am not suggesting a Machiavellian manoeuvre here. Quite the opposite. I am suggesting a clarifying manoeuvre to bring hidden differences out into the open, in order to preempt yet another round of Machiavellian maipulations to prevent the very sort of cooperation that Obama advocates for. What I'm going to do is recall Obama's remarks about Ronald Reagan, which have once again divided progresssives, and then I'm going to suggest two possible alternatives that could have found broad acceptance among progressives, while causing legitimate, and clarifying consternation among conservatives.
The first alternative questions the efficacy of Reagan's conservativism, and pushes the case that Eisenhower is a better, more substantial model to follow. Eisenhower isn't generally thought of as a conservative, but that's beause movement conservatives are actually reactionaries, who have kidnapped the "conservative" label. Eisenhower's model of gradual adaptation, not seeking to radically alter what has become part of the organic fabric of society (such as Social Security) is perfectly in line with the main thrust of Edmund Burke's thinking. Joseph de Maistre, not so much.
The second points out a number of liberal inconsistencies in Reagan's record, and casts doubt on whether he'd be accepted today as a true heir of himself. The example of Mike Huckabee is instructive in this regard, too.
Well, in turns out that Americans really don't like the idea of Reagan on their money, at all:
A Republican congressman from North Carolina has proposed legislation that would replace the image of President Ulysses S. Grant on the fifty dollar bill with that of President Ronald Reagan. Do Americans want this change to occur?
Most do not. 79% think this suggestion is a bad idea while 12% say it's a good one. 9% are unsure.
Reagan is the modern day hero of many Republicans, but even more than seven in ten members of the nation's GOP - 71% - believe the switch is a bad idea. 83% of Democrats and 79% of independents agree.
12% support? Wow. Support for the Reagan pyramid is probably even lower.
I always thought the frequency with which leading Republicans venerate Ronald Reagan was odd, and discordant with popular sentiment. This is especially the case among Presidential candidates. Whenever Sarah Palin, Mitt Romney, John McCain, or whoever, launches into a Reagan paean about how he was the greatest America EVAH, it inherently positions the speaker as a distant shadow of that Platonic ideal.
Correct me it I am wrong, but if you are vying to lead the country, isn't it better to set yourself up as the ideal, rather than setting yourself up as a poor reflection of the ideal? No one is thought of as a great President because they were Lincoln-esque--Abraham Lincoln is thought of as a great President because he was Abraham Lincoln.
But hey, whatever, I will stop concern trolling Republican talking points for now. Go ahead, just keeping the name-everything-after-Regan deification program. According to polling, it really seems to have vast nationwide support.
Well it looks like it's mid afternoon in Health Care Reform land. You remember Health Care Reform don't you? That thing that some of the talking heads were carrying on was a dead thing? Yeah well about that, not so much. People might not completely agree on details, but the one thing that pretty much everyone who's not a politician or a CEO Can agree on is that we are sick and tired of having to go through our days living in terror of getting sick. The system is broken and we want something done about it. NOW!
[Note]: If Democrats & progressives practiced hegemonic warfare, the way Republicans & conservatives do, you would be able to recite the contents of the following diary in your sleep. Rachel Maddow, Keith Olbermann, heck, even Chris "The Osmosis Kid" Matthews would have shown you snazzier versions of the charts below a gazillion times alredy.
For conservatives, Ronald Reagan is a god. As well he must be, since gods are not to be questioned, and conservatives are not the questioning kind. Nor is Reagan the sort who stands up to scrutiny well, as I and countless others have pointed out on occasions numberless to man (though perhaps not to women who Google). For one thing, I can just never get over the fact that it's virtually certain he got into office by an act of treason--much like Richard Nixon did--and that Lee Hamilton, the Indiana prototype for Evan Bayh, let him get away with it. But if the political machinations of getting into office are obscure and controversial, the economic record is etched in stone in indisputable, widely available (it's on the internet!) public data. And this week, I just happened to stumble across a website comparing Reagan's record to that of the Clinton-who is, for modern conservatives, an antichrist-like counterpart to Reagan's godhood.
The website was created by a fellow named Patrick Ziegler way back in 2002. The best view for getting the point across is the "Charts and Commentary" view. The charts aren't the best quality in the world (Hey! It was 2002!), but the information they convey is devastating, and the commentary, though brief, makes sure you get the message.
For example, the first graph shows government receipts in billions of dollars:
As noted in quick hits by BDB and rayj, [UPDATE] and by David in a diary that just caused me to push back this diary's publication time, Obama has now gone off the deep end. After passing a stimulus that most economists (not just liberal ones) said was too small, and that was made even more inadequate by being heavily tilted toward poor-performing tax-cuts, Obama is now intentionally recreating FDR's mistake of 1937, when he prematurely cut back spending to try to balance the budget, and sent the country into a new recession.
Let me repeat that, in larger type:
Obama is now intentionally recreating FDR's mistake of 1937, when he prematurely cut back spending to try to balance the budget, and sent the country into a new recession.
Specifically: He's going to announce a spending freeze on domestic programs (but not, of course, on the military) that is "projected to save $250 billion." The rationale is that he wants to appease folks worried about runaway deficits. Which is just what FDR was worried about in 1937.
This is Bush-style idiocy. There is no other word for it.
Adding insult to injury, at the same time, he's also proposing more Ronald Reagan/GW Bush tax cuts... which will, of course, increase the runaway deficits.
And he's also talking about privatizing NASA. Because privatizing the Pentagon turned out so great!
It's time to seriously start talking about primarying Obama in 2012. He's now officially the most conservative Democratic President since Grover Cleveland. And the dumbest one since James Buchanan.
Here, to remind you, is the chart I put together during the stimulus debate, showing, among other things, the relative ineffectiveness of tax cuts vs. spending in generating jobs, which is the key to getting the nation out of this recession--the only way that we can rationally hope to start bringing down the deficits:
While some tax cuts are much better than the real stinkers, it's virtually a given that once Obama starts talking about tax cuts, the GOP is going to start demanding that Bush's tax cuts be made permanent. Not only--as you can see from the chart--are these about the least helpful tax cuts of all, they are also heavily skewed toward helping the rich and the super-rich.
Political scientist James A. Stimson's aggregate measure of policy mood clearly shows that Kennedy/Johnson came to power in part as a result of a significant leftward shift in political attitudes--which they did not cause. Likewise, Reagan came to power in part because political attitudes had been shifting to the right for more than a decade. Rather than moving America to the right, Reagan was a result of a rightward shift that sharply reversed itself throughout his tenure... and beyond.
Sometimes when things are going horribly wrong, it helps to take a look back and ask if there were early warning signs that should have been taken more seriously. Played badly, this sort of exercise is nothing more than a game of "I-told-you-so." But sometimes "I-told-you-so" is not such a bad place to start. And sometimes, it can be more than that. It can be a way of reviving mistakenly discarded lines of thought that can provide fresh ideas about how to get back on track. It's in hopes of this last alternative that I write the following.
I don't want to present myself as some sort of singular figure. I think part of what's different are the times. I do think that for example the 1980 was different. I think Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not and in a way that Bill Clinton did not. He put us on a fundamentally different path because the country was ready for it. I think they felt like with all the excesses of the 1960s and 1970s and government had grown and grown but there wasn't much sense of accountability in terms of how it was operating. I think people, he just tapped into what people were already feeling, which was we want clarity we want optimism, we want a return to that sense of dynamism and entrepreneurship that had been missing.
While Obama subsequently tried to backpaddle from that, he was never very convincing to some of us. At the time, the Clinton & Edwards campaigns both pounced on him, and one could credibly argue that their attacks unfairly mischaracterized what he was trying to say. This was the argument made by he St. Petersburg Times at it's Polifact.com website, in a piece titled "Obama not a Reagan Democrat" (more on this below).
But even if he wasn't actually enthusing over Reagan--a fair point, if one reads the full transcript--he was expressing himself in Reaganite language, in effect underscoring the point that he would not be a transformational leader, contrary to everything he was trying to convey to his adoring base.
A Paul Rosenberg Golden Oldie
From Sun Jan 20, 2008. Original HERE.
I had a wonderful post on this subject, what got et when the site went down yesterday. It did go down, didn't it? It wasn't just me? So you'll just have to make do with this vastly inferior version.
Regardless of his intentions, Obama has been doing a pretty good job of splitting the left for some time now. Secular humanists, peace activists, Boomers, gays, all have had their turns feeling particularly spurned, while his version of triangulation has many even more nervous than the Clinton version made them. Many think he's got the perscription exactly backwards-Democrats don't suffer from being too much like the always-combatative Republicans, but from being too wimpy, too reluctant to stand up and fight for what they belive. And many think that now's not the time to reach out with a hand of friendship, just when they're sinking like a stone.
In this diary, I'm not going to try to solve all the differences just mentioned. Rather, I'm just going to look at one prominent example from the last week, and look at how it could have been handled differently, so that the divisions generated would have been among conservatives, not progressives. It's a very logical strategy to pursue on two counts: First, as a progressive, Obama should naturally want to unify progressives. Second, given that only some conservatives are genuinely interested in cooperation, while others are dedicated to oppostion, it makes perfect sense to reach out specifically to those who are reachable in a way that clarifies their differences from those who are not.
I am not suggesting a Machiavellian manoeuvre here. Quite the opposite. I am suggesting a clarifying manoeuvre to bring hidden differences out into the open, in order to preempt yet another round of Machiavellian maipulations to prevent the very sort of cooperation that Obama advocates for. What I'm going to do is recall Obama's remarks about Ronald Reagan, which have once again divided progresssives, and then I'm going to suggest two possible alternatives that could have found broad acceptance among progressives, while causing legitimate, and clarifying consternation among conservatives.
The first alternative questions the efficacy of Reagan's conservativism, and pushes the case that Eisenhower is a better, more substantial model to follow. Eisenhower isn't generally thought of as a conservative, but that's beause movement conservatives are actually reactionaries, who have kidnapped the "conservative" label. Eisenhower's model of gradual adaptation, not seeking to radically alter what has become part of the organic fabric of society (such as Social Security) is perfectly in line with the main thrust of Edmund Burke's thinking. Joseph de Maistre, not so much.
The second points out a number of liberal inconsistencies in Reagan's record, and casts doubt on whether he'd be accepted today as a true heir of himself. The example of Mike Huckabee is instructive in this regard, too.
One thing I've recently observed is the degree to which America self-corrects when selecting its leaders. It's very interesting to compare successive presidents; the new president nearly always lacks the weakness the previous president had. Though of course he comes with his own flaws.
I'll start with Jimmy Carter. Carter was known for being honest and a bit naive, in stark contrast to his predecessor Richard Nixon.
Carter, however, had a negative reputation for being an obsessive micromanager. He was replaced by Ronald Reagan - who was famous for leaving the details (and sometimes the whole plan itself) to his aides.
Reagan and the elder Bush were criticized as too old for the job. So along came Bill Clinton and Al Gore, the youngest presidential team in history, as the next presidential group.
Of course, Bill Clinton is remembered for his sexual indiscretion and the Monica Lewinsky affair. His replacement - George W. Bush - was widely characterized as morally upright and religious.
He was also characterized as stupid. Which is a criticism nobody would level at his successor Barack Obama - one of the most intellectual persons who has ever graced the high office.
For those who don't, this is Ronald Reagan's landslide election over his hapless opponent Walter Mondale.
Unfortunately, for those who look for political trends, this map hides more than it reveals. For example, Reagan wins Massachusetts, but reasonable people would agree that Massachusetts is normally a Democratic state.
STATE BLOGS
