Month: August 2011

The Republicans are serious budget reformers; the lady from Washington, doesn’t do budgets.

Grover Norquist, primary driver of conservative economic policy in the form of his idiotic anti-tax pledge. In every way that matters, this is who they are.
He’s referring to the second highest-ranking member, male or female, of the Senate Budget Committee, Senator Patty Murray. You stay classy, Grover.
Source: The New York Times

You don’t want these candidates moving so right in the Republican primary that it becomes impossible for them to win the general election, because it will become a self-defeating message in the primary.

People want to win. They don’t want somebody who goes so far to the extremes of either party that they lack a chance to carry a victory off in November.

Karl Rove, old turd blossom hisself, opining on the GOP Presidential primary field.
Sorry to be the one to tell you this, Karl, but the “sensibility” ship has sailed, been round Good Hope, and round the Horn, and round the Norway Maelstrom, and round perdition’s flames, and subsequently was no-bid auctioned into a second career as a part-time riverboat gambling operation for KBR executives.
John Huntsman even put his hand up on the “10:1 cuts/revenue is a non-starter deal” question and he’s only running for 2016 positioning. There is no one in the field even trying to be the slightly more sensible, slightly more center-far-right candidate of today’s GOP. Mittmentum, the man made to take up that role abandoned it in 2008. His strong showing then has sensibly pushed him even further to the right now. That ought to fix his issues. If the GOP can’t win the general election from a far right stance, they almost can’t win in 2012. And if the economic headwinds were a bit more predictable, we could drop the “almost” qualifier right now.
But the last thing The Democrat would want to do is start making the GOP take stands against job creation. People just don’t want to hear about that stuff right now. Shrill. Better take a “non-confrontational approach,” get into the defensive crouch, and hope for the best. And this is why they fail.

If this guy prints more money between now and the election, I don’t know what y’all would do to him in Iowa, but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in American history is almost treacherous, or treasonous, in my opinion.

Rick Perry, governor or Texas and candidate for the GOP nomination for President, apparently accusing Federal Reserve chairman Ben Bernanke of treason.
He really is going to invigorate the GOP primary. What a strong field they have.
Source: Washington Post

Read Up

Yglesias details the 10 “Weirdest Ideas” in Rick Perry’s Fed Up. It’s a must-read post that I’ll tease with this single, highly representative sentence:

The propriety of a federal role in regulating the banking industry has been the subject of bipartisan agreement since the Madison administration.

Says it all.

Read Up

Robert Reich: Why the New Healthcare Law Should Have Been Based on Medicare (And What Democrats Should Have Learned By Now)

robertreich:

So what do Obama and the Democrats do if the individual mandate in the new health care law gets struck down by the Supreme Court?

Immediately propose what they should have proposed right from the start — universal health care based on Medicare for all, financed by payroll taxes. The public will be behind them, as will the courts.

This is utterly wrong on all counts. It utterly and willfully ignores the year of political sausage making that only managed to barely result in a marginally workable plan that squeaked by under reconciliation rules. The law enacting Reich’s paragraph couldn’t have passed a majority of Democrats at the time, and you’ll recall there were commanding majorities in both houses of Congress then. Aren’t now. And this wouldn’t even see the floor, no matter how passionately Obama or Bernie Sanders or Nancy Pelosi or Jesus Christ Himself argued for it.

What, then, needs to happen if the mandate section of the ACA is struck down? The death spiral needs to happen is what. The ACA without a mandate will destroy the private insurance companies within a decade. But,long before that happens, when the moment arrives that the mega-rich can no longer afford premiums, the party in power on that day, whichever that may be, will be forced to enact Medicare for all. Immediately. Not because they want to, but because it will be the only way forward. And that is the one and only way it ever gets passed. Not through rousing speeches or acting tough or with anything less than a 70-80 seat majority in the Senate and a few hundred in the House coupled to a far more progressive Democratic President than is currently serving.

And until the moment that we as citizens, they the politicians, they the DCCC (and like groups that run the party, its messaging, goals, and determine its candidates), and especially they in the form of the broader media internalize this and begin to act on it accordingly, we and they will fail. Period.

Robert Reich: Why the New Healthcare Law Should Have Been Based on Medicare (And What Democrats Should Have Learned By Now)

Cokie’s Law vs. Social Security

Dean Baker at Beat the Press:

… it was incredibly irresponsible for NPR to tell listeners in its top of the hour news segment that the market plunged because Standard and Poor’s downgrade of U.S. debt. NPR does not know this to be true and it certainly is not obviously the case.

The market that should have been most immediately affected by the S&P downgrade was the U.S. bond market. However bond prices soared in the trading immediately following the downgrade and continued to rise through Wednesday. If there was greater fear that the U.S. would default because of the downgrade, then bond prices should have plunged as investors demanded a higher risk premium. This did not happen.

The most obvious alternative explanation for the plunge in the market is the risk that the euro could break up as the debt crisis spread from relatively countries like Greece and Ireland, to the euro zone giants, Spain and Italy. The prospect of a euro zone break-up raises a real risk of a Lehman-type freeze up of the world financial system. It is far more plausible that this prospect led to the plunge in the stock market than the downgrade by one of three major credit rating agencies.

This point is important because many political actors, including National Public Radio, are trying to use the debt downgrade as an argument for cutting Social Security and Medicare. Their argument will be furthered if they can claim that the downgrade had enormous consequences for the stock market, since so many people involved in political debates (i.e. columnists, policy wonks, reporters, congressional staffers) have substantial amounts of money invested in the stock market.

This is exactly right. All this nonsense about S&P’s downgrade “causing” movement in the US stock market (which, as far as the MSM is concerned, is entirely comprised of the Dow Jones index) is wrong. Foolish, even. This has been reported occasionally, and NPR and other political actors are at least slightly tempering the “S&P caused it!” meme.

But it won’t matter. The facts do not matter. Cokie’s Law, the ironclad rule that anything, any information be it merely incorrect or proven to be an outright lie or pure fabrication, once “out there” must be reported as though it is fact. Period. Therefore, as weeks and months pass, the core narrative becomes:

“S&P downgrade caused massive loss of wealth in DJI; therefore Social Security and Medicare must be cut; elimination is the GOP’s preferred outcome, therefore the "sensible center” is merely devastating cuts followed on every few years with more “sensible” cuts until we reach said elimination. This is the only Serious Position possible on the issue when one considers the facts of the S&P downgrade and its devastating impact on the Dow. Why, some say that as much as $1T in wealth evaporated. We simply must act to cut Social Security. Everyone knows it is the problem here.“

There will be nothing else. No other opinion will be allowed, and if directly challenged by the reality of the situation, reporters and pundits will characterize the truth as simply one other fringe "opinion” that the dirty fucking hippies are pushing again, and no better or worse than the obvious fallacy that was created by them simply because said fallacy has been widely reported. When (and if) directly challenged on the ontogeny of said MSM-created fallacy, they will elect to “leave it there,” declare it “complicated,” or, in the case of Cokie herself, sputter about it being “out there.” You heard it here first.

S&GOP

Ezra Klein:

My hunch is that S&P was making a political argument and felt the need to cast it as deficit arithmetic. Then, when their arithmetic proved wrong, they were left looking foolish. As it stands, you actually can’t coherently merge the first and second versions of S&P’s explanation of the downgrade. That should tell you something about how rigorous their framework is, even if doesn’t obviate the still-legitimate points they made about our political system.

I think Ezra is fundamentally right here. The problem is this: if S&P set out to make a political point, they did so in such a fumbling manner that the political message, the most important part, was utterly lost. The MSM has a fundamental inability to report on something negative relative to a single party. Obama offered at least four debt ceiling deals, including several that had previously been GOP deals. How was this reported? “Both parties unwilling to compromise; President unwilling to lead and/or deal”
S&P issues a report castigating GOP intransigence on revenues. Reported: “political system unable to deal with current crisis.”

If S&P truly intended to make a political point, the report itself needed to be called “The GOP’s Willful Destruction of The American Century” or “Political Nihilism and Today’s GOP: A Downgrade Story” and furthermore needed to be told through colorful pictures and in fewer than 50 words. There’s no way in hell a company like S&P is going to do this; they are fundamentally incapable of really making the political point that they seem to have set out to make, as such moves soon prove to be bad for business. (And don’t think for a moment the GOP will forget this slight. There will be GOP initiated investigations, damaging ones, into S&P at the first available opportunity). Therefore: you don’t do it at all unless you can back it up with hard numbers such that the conclusions are inescapable. Which they also couldn’t do. But that national embarrassment is a whole other post.
Assuming for the moment that they went there and made the political point utterly and inescapably explicit, even then, it would be hard to get the MSM to report it as such. They’d dodge with a “it’s all very complicated” or “let’s leave it there” or simply book only conservative guests and allow them to talk as long as they want to without challenge or correction. Above all else, they’d avoid any mention of what was actually written in the report. You know: pretty much what’s happened in the last several days.

Naturally, this all has to transpire alongside the slow-motion European financial collapse and its effect on global markets. Typically “USA über alles” reporting over-stresses the influence, if any, of the downgrade on global events. “Post hoc, ergo procter hoc motherfucker” may as well go on the Times masthead. People are stampeding for Treasuries!!! It must be the downgrade of that instrument’s backing that is causing them to do this!!! (Had the downgrade not occurred, at least FOXnews and maybe the broader media would have blamed the collapse in value on the Presidential birthday BBQ’s failure to durably impact jobs creation). The MSM response? Get some folks on to scream “I blame the Democrat and the dirty fucking hippies for this historic downgrade of the United States and the similarly timed collapse of the global markets. The only response is to slash the social safety net, cut taxes, and increase defense spending. Or a mandatory National Week of Constant Prayer. Whichever.” What other rational approach is even possible?“

This is why we fail.

[Rather than a double dip recession] we may be looking at 2 years or more where the growth could be in the range of 2.0 percent or even less. When we have 9.1 percent unemployment, this is an outrage. If we get people applauding because at least we are not seeing a double dip, then we have to calmly escort these ignorant beings to somewhere far away from economic policy discussions. They clearly do not have a clue and need to try a different line of work.

Finally, it is 100 percent nonsense to say that the government is out of policy options. We can do more stimulus. The financial markets are yelling at the government at the top of their lungs saying “borrow more money.” That’s what 2.6 percent interest rate on 10-year Treasury bonds means. There are balanced-budget worshipping politicians who say that the government can’t do anything, but this is not true and the NYT has no business repeating it.

The Fed could also do more. […] Ben Bernanke has himself suggested: targeting a long-term interest rate (e.g. a 1.0 percent 5-year Treasury rate) or a higher rate of inflation (e.g. 3-4 percent). […]

The government could also try to create jobs by taking steps to lower the value of the dollar. The Chinese government has been making threats that it will stop buying up U.S. government debt if we don’t take their advice. The Obama administration could ask what they most want and then do the exact opposite. If the Chinese government stops buying U.S. assets then the dollar will fall against the yuan. This is equivalent to imposing a tariff on Chinese imports and giving a subsidy to U.S. exports. In other words, it should lead to a burst in net exports which will lift the economy and create jobs.

Dean Baker is either giving great analysis of the nation’s near term economic outlook and policy options –or– reciting a litany of facts, large and small, that you will never, ever hear on any MSM outlet. Even by accident.
I’m not sure which, though.
Source: cepr.net

Who’s To Blame?

Jay Bookman wants to know a few things:

Who rejected “the comprehensive fiscal consolidation program,” with cuts to entitlements accompanied by higher revenues, producing a debt reduction of $4 trillion, proposed by President Obama? That would have produced twice the debt reduction promised in the deal that was finally accepted.

Who rejected the very notion of compromise, making “the differences between political parties … extraordinarily difficult to bridge,” with one side announcing that only total capitulation by the other side would be accepted?

Who embraced the policy of political brinksmanship that pushed the country so perilously close to default? Who publicly embraced the threat of default as “a hostage that’s worth ransoming,” announcing that the tactic would be used every time the debt-ceiling issue arises from now on?

To hear any of these questions, much less any of their answers, one would be well advised not to even bother with the MSM. They are in full on “pox on both houses” mode. This is an entirely self-inflicted, politically motivated wound. Why won’t anyone ask the GOP why they thought it best to bring ‘em on?

Who’s To Blame?

This Is Why

Standard and Poors to downgrade US credit rating:

A source says Republicans [steadfast refusal] to accept any tax increases as part of a larger [deficit] deal will be part of the reason cited [for the historic downgrade].

How do you imagine the radical Socialist Obama administration plans to respond on behalf of The Democrat?

[An administration] official says that S&P made a “serious mistake” in its analysis, “based on flawed math and assumptions,” so the Obama administration is pushing back.

This is why they fail.

This Is Why