Category Archives: Politics

Better The Devil You Know?

I’m not calling President Obama the devil, but unfortunately I feel many liberals believe Obama has left them high and dry. I may just be a simple policy wonk, but if you look at history and what this president has accomplished, it has been some of the most progressive policies ever.

The prime example liberals point to is health care. The Affordable Care Act did a lot to curb costs and keep Medicare solvent for future generations. While there are problems with it, such as the possible illegality of requiring everyone to have insurance, it is by far the biggest accomplishments any president has made since the Social Security Act in 1935.

During the process though, Obama made a deal with the insurance companies saying he would not include a single payer system with the reforms. So instead of an entire new government agency that would manage people’s healthcare, it is instead going to be managed by private companies. In the long run, it probably would have been cheaper to have done it through the government. But what would have been sacrificed is the quality of the care people received. Hospitals in this country are run pretty well, and studies have shown countries that have public facilities don’t get to people’s needs as efficiently. Even in Canada where health costs are cheaper for the countries citizens, it is still easier to see a doctor privately then if you go to a public office. Even if a single payer plan was enacted cost constraints would have also have been needed to make sure the price for these services is going up fairly. This, by the way, was the main problem to begin with. Those controls are in the Act and will be enacted in future years.

And don’t forget, when Social Security was enacted, the law stated people would receive benefits when they turned 65 years old. Of course, the average people were living to then was 61.

Then there is foreign policy. Obama inherited wars in Iraq and Afghanistan, and during the campaign he said the military would be removed from the Middle East. Well, it may not have been as fast as everyone would have liked, but our troops are coming home from Iraq next year, and with the continuing stories of corruption in Afghanistan, plus having killed Osama Bin Laden, there is no reason for us to be there anymore either. Just last month Obama set goals for getting the troops out of Afghanistan as well. With the amount of military equipment there is, it still wouldn’t have mattered when the order was given to recall the troops because it would have taken a while to get everything out of there anyway.

If you noticed there hasn’t been a lot of talk about these two countries recently because of what had occurred in Egypt, and there haven’t been many big operations within the last year. While many erred at the troop increase, after it had taken place violence in Afghanistan sharply decreased, and Al Qaeda has had trouble recruiting new members.

I have complained many times about Obama, particularly the way he had forgotten how to get his point across. At the town hall today he admitted he wish he had done a better job explaining to the American people how his policies would help them. It almost cost him the gains he made with healthcare. But the policies this President has gotten through will help millions of Americans, and improve their quality of their life.

Politically speaking, Obama owns the middle, which he needs to win next year in order to stay in office. Every poll shows that no matter who the Republicans nominate to run against Obama, he or she losses. Liberals should also remember that if a Republican were in the Oval Office, the people that President would have to appeal to are extreme conservatives who want to dismantle the social safety nets that are needed today need more than ever.

Our government was built so people can be skeptical of it, and it has served us well. The American people, by default, are not meant to trust their elected officials. When Obama says we need reforms to social programs, it is to make sure they are there for our children. It might require some cuts for those who are earning enough to pay out of pocket, but that is a lot better than not having anything at all.
Those on the left should remember it is better to have someone in office that you know will have to appease you, and not the one who doesn’t.

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Filed under Politics, President Obama

Triangulation On Taxes

Time is running out on playing politics and real decisions are going to have to be made. As the President and Speaker play golf, the rest of Congress needs to decide how to raise the debt ceiling without completely leaving the poor and working families in the dust, and both sides know more revenue is going to have to come from somewhere.

Before going into the first of four meeting this week to discuss the debt ceiling, Majority Leader Eric Cantor said “We have hit the point at which we are at some really tough stuff. Big numbers, everything as I have said before is on the table except tax increases.”

As negotiations continue, Republicans are asking for over one trillion dollars in cuts that won’t include Medicare or Social Security. So that means other programs that involve grants for research, food stamps, public housing, and infrastructure, are potentially on the chopping block. The GOP is serious about the cuts, but they’re not evil beings who want to see people suffer.

In this time of economic ups and downs, taxes need to be raised in order to keep the programs running that are helping people stay afloat, and Republicans know this. Even though their most conservative supporters don’t want them to raise taxes on anyone, the party that was built by Abraham Lincoln does not want to be become the party who turned its back to the poor.

A New York Times article on Monday discussed lowering the tax rate for multinational corporations who hold assets abroad, where they will bring the money back and invest it. The amount of money is worth billions, some by single companies, and is sitting in accounts around the world where they are barely touched. Republicans have always been in favor of lowering corporate tax rates, but many Democrats have argued these companies do not pay any taxes even under the current rules.

However, this proposal seems to be gaining momentum as Senator Chuck Schumer is negotiating a deal, with both sides, for lowering the rates into a jobs package being put together in the Senate that focuses on infrastructure. According to the article on CNN “While the repatriation holiday alone is a non-starter for most Democrats, pairing it with an infrastructure program could marshal labor support. It’s an approach backed by former Service Employees International Union president Andy Stern, who’s emerged as the most vocal proponent of the tax holiday on the left.”

But while corporate tax rates might be lowered, a part of the deal will be to close the loopholes corporations currently use to avoid paying them in the first place. But no matter how you cut it, say it, or write it, closing loopholes is a tax increase.

Once the deal is cut, Eric Cantor will be talking about how cutting spending and lowering the overall corporate rate will create jobs. But cutting spending has nothing to do with creating jobs, in fact, it could make the entire situation worse. Right now states want to hire people to strengthen their infrastructure but they need the money to do it. But banks aren’t lending, and since the GOP refuses to spend any money, states are stuck.

On the second point, if the overall tax rate is lowered, the IRS wouldn’t be collecting as much as they would now if they enforced the rules already on the books. But if the deal passes they would be collecting more money because the rules will be easier to enforce, and presumably there will be more money to collect. But politicians could be taking a huge gamble. There is no guarantee these corporations will bring back the money, or European governments won’t lower their taxes even further so those corporations keep their money where it is.

And don’t forget, most of Europe’s taxes are collected through a Value Added Tax System (VAT) which allows them to collect money before these large corporations accountants and lawyers figure out how to hide it.

Democrats will declare this a victory too. Many liberal economists are trying to figure out ways for the government to put more money in people’s pockets. One idea has been to lower the amount being taken away out of people’s paychecks for Social Security and Medicare. So yes, economists do consider tax reductions a stimulus. But the only stimulus that takes place is through the money that people spend when they receive their cut, which right now isn’t much. In this climate they are more likely to save it or spend it on necessities like rent, healthcare, and food (like that last one did), which only had a small and short impact on the overall economy.

The Tax Code is a complex monstrosity that should be put into a shredder and thrown into a furnace. But let us digress, and come to the realization that even if this plan does come together, there is no way to determine how many jobs will be created or how much it will reduce the deficit. It is a possibility for a short term solution, that requires long term thinking, and no one can say how much good it will really do. In the end it is just another example of how current economic models and the advice given to politicians are defunct.

 

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Filed under Budget, Congress, debt, debt ceiling, Democrats, Economics, Eric Cantor, Political Economy, Politics, taxes, VAT

Living In The Present And Working For The Future

Sometimes it gets easy to blame the media when polls show the American people contradicting themselves on questions. But this time only the politicians have themselves to blame. The WSJ/NBC poll found 61 percent of American’s believed the budget should be cut, while only 31 percent said they believed the President and Congress should boost the economy even if it means an increase in budget deficits.

Having always being against increased spending and raising taxes, Republicans have had it easy. It’s always a lot easier to say “read my lips, no new taxes!” or “government isn’t the solution, it’s the problem” than “I am going to raise taxes, just not yours” or “sometimes government regulation is needed, and sometimes it’s not”. Campaigns are sometimes won if the voters do not understand what you plan to do in office or what you did while in office. If they don’t agree with you that’s one thing, but if they don’t understand what you’re about that’s a whole different problem.

Economists and policy wonks alike have made arguments (Robert Reich, Fareed Zakaria, and, not that I’m on their level, but yours truly) that the problem with the economy right now isn’t the supply of things, it’s the demand for them. No matter what income bracket American’s are in the majority of their money goes toward housing, followed either by insurance or healthcare, and then food. Things like Ipads, movies, music, days at the beach, are all luxuries many American’s can’t afford or are squeezing out of their pockets. But when the economy was moving in the 1990’s these were areas that did really well.

Even though most people were not earning more money, they were confident in the future which allowed them to spend money on extra outings or stuff that allowed them to have fun with their families and friends. But now the cost of gasoline is so high in some areas that driving to work is costing families most of their weekly budgets.

What both parties do a bad job of explaining is that economies are cyclical and money has to come from somewhere. Even in times when the economy was strong, families did not earn enough to pay for health insurance on their own. So the government had to step in and create policies that made sure families were secure in the long run so they could live in the present.

When the last round of tax breaks were passed, the “extra” money people thought they had was spent on necessities like food. None of the areas that would have a bigger effect on the economy like infrastructure or food stamps were even part of the bill. That being said, the biggest items economists claimed would have a simulative effect wasn’t even an increase of 2 percent, and in some cases it wasn’t even 1. These were also short bursts of growth, it wasn’t anything that would have secured families in the long run so their kids can go to college, eat, or get to work.

But when we see video’s of the President saying government is wasting our money, of course no one is going to believe that the government can do anything right. Whether he is right or wrong, it gives the Republican’s the ammunition they need to say there is no reason for you to be taxed. President Obama also likes to remind people we are coming out of what was almost Great Depression 2.0. Well, when FDR cut stimulus funds during the middle of his depression, the American economy went into another free fall. Plus with interest rates as low as they are, and Bernanke not hinting to raise them any time soon, more money into the economy won’t do any harm. In fact, all signs point to gains.

There is also no proof that raising taxes will hurt the economy either. In fact, it was after George H. W. Bush raised taxes the economy really started to move. It shows one thing has nothing to do with the other. But if policy makers are serious about making sure America stays number one, raising taxes on the rich to secure social programs and create a stimulus is a must.

I don’t think anyone is willing to bet right now they will be making enough money to retire in the future. No one ever has, which is why pensions and Social Security were created in the first place. The federal government needs to spend more money in exchange for short term debt. If they don’t more scenes, like the ones taking place Minnesota, will be more frequent around the country. More stimulus now means more people will be working, families can buy what they need, and more revenue can be raised in order to take care of the families in the future.

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Filed under America, Budget, Congress, Economics, economy, Families, Political Economy, Politics, President Obama, taxes

Democracy At Work?

On Sunday, Eric Cantor announced the second round of his “You Cut” website, where people are given three options of federal programs they would like to see taken out of the budget. In general, I’m in favor of open government initiatives in hopes it gets people to pay more attention, and realize it’s not as simple as choosing which programs to cut. But Cantor goes about opening up the process entirely the wrong way.

Instead of having an honest discussion on how to balance the budget, You Cut lists three things the Majority Whip would probably like to see gone anyway, without any discussion. Besides voting which program they would like to see cut, the only other option people have is to submit another program to cut in a small box explaining why it should be eliminated. I’m also not a conspiracy theorist, but I seriously doubt those suggestions are taken seriously. As someone who just created and researched websites, small boxes indicate to people they don’t have a lot of room, and if you really want more thoughtful suggestions you want to make it clear to your viewers they can say as much as they want. Instead, there is only a biased blurb about each program and why it’s bad, and there is no room for people to discuss why one program should be cut over the other.

So let’s take a look at the options presented to us. The first is to reduce the number of federal employees by 10 percent, saving $139 billion. The first thing that stands out to me, and how you know Ryan is making the numbers up, is he doesn’t even list the number of employees that will be cut. Just because someone is retiring, doesn’t mean that their job wasn’t important. All the water treatment plants around the country need to be inspected, and if land is to be used to for new or growing businesses, their needs to be an assessment to make sure it is safe. If there are problems in the future in either of these areas, people will ask why no one was on top of the situation.

The second option is to eliminate the Economic Development Administration (EDA) within the Commerce Department. Yes, this is one of the recommendations by the Bowles-Simpson commission. One of the reasons for the EDA, and the blurb points out, was to build roads across the country that would create jobs. Well, the last time I checked the country’s infrastructure was graded a D. So instead of throwing out things we know have worked in the past, why don’t we try and use them again in a time we need more jobs?

The last item on the website is about the Department of Energy’s Weather Assistance Program (WAP). Cantor, without posting any links, says that “The program generated headlines for significant instances of waste, fraud, and abuse, including paying for shoddy and ineffective workmanship and payment for work not actually done.” But it doesn’t discuss news outlets in Mississippi telling its viewers about the program and how it can help them. Or in the winter when Chuck Schumer touts how this program is keeping residents in upstate New York warm. The truth is this program helps millions of people around the country stay cool in the summer and warm in the winter. By cutting it, Eric Cantor is telling all the people who apply to these grants, they should figure out how to pay for their energy bills themselves.

Obviously, as we have seen in recent events, there are ways politicians should and should not interact with their constituents. But the efforts people are taking to make the internet a platform where the government can interact with its people work long and hard hours figuring out ways to do so effectively. You Cut doesn’t accomplish any of the criteria those people are looking to accomplish. If Eric Cantor is serious about wanting to create a smart budget, he needs to figure out a better way to do it.

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Filed under Budget, budget ceiling, Congress, debt, economy, Eric Cantor, Government 2.0, Politics, Republicans

Nuclear Puzzle

A guy named Gregory Jaczko is about to get more exposure to the media then he has ever wanted. He was appointed by President Obama in 2009 to be the Chairman of the Nuclear Regulatory Commission (NRC), and will be testifying before Congress this coming week on a report that came out, from the NRC, that concluded “Mr. Jaczko failed to fully inform the other four members that he was issuing budget guidance that would essentially halt the commission’s work on the project, which was to decide whether the Energy Department should be allowed to build and operate the dump.”

The project they are talking about is Yucca Mountain, Nevada, which is about 90 miles away from Las Vegas. According to the article, Jaczko used to work for Senate Majority Leader Harry Reid, who has always been fighting to keep Yucca Mountain from becoming a permanent site for nuclear waste. During the 2008 election, Obama, while being in favor of nuclear energy, said many times Yucca Mountain will not become a place for nuclear storage. More information has come out since then making it clear Obama and Reid are close. It was Reid who convinced Obama to run for President, and when the Republican National Committee put millions into “Daschelzing” Reid last year, Obama held events and fundraisers in Nevada.

Policy wise though, it made no sense for Obama to be in favor of using nuclear energy but not store it at Yucca. Time and time again the NRC has said Yucca Mountain was the best place to store nuclear energy and was close to it in President (W’s) Bush’s first term. Bush signed the law to turn the area into a storage facility, only for it to be vetoed by the Governor, and then overturned by Congress.

As far as Jaczko is concerned, the report said he did not break any laws, but he obviously didn’t make any friends. Obama put him on the commission to look at other sites in the country that can be built for storage. It’s an example of a political appointment, and someone coming in with an agenda. It’s the nature of the game. But while other sites around the country are closer to residential areas, Yucca is closest to volcanic lava on federal land. Using nuclear energy is clean, creates jobs, is more efficient, and costs less than other forms of energy. According to World Nuclear the price of generating nuclear fuel is cheaper then coal and gas, making it cheaper for consumers in the long run. Readers know I want to visit Las Vegas again, but people don’t like to see wind turbines in their back yard, and solar power can’t be used everywhere or at any time.

I write a lot about how politics get in the way of good policies being put together, this is an example of that. At the same time, politics is also a necessary evil. If it wasn’t for Harry Reid, Obama may not have run for President, and of course the alternatives to a democracy/a republic don’t look to good. All the pundits were saying nuclear energy would take a step back after the earthquake in Japan, but eventually there’s going to be more nuclear plants in this country, it just makes too much sense. Designs for nuclear plants have improved since the one at Fukushima was built, and obviously we don’t have to build them on a fault line. There’s a smart way to do it, and eventually enough politicians will solve the puzzle to get it done.

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Filed under Clean Energy, Congress, Environment, global warming, Harry Reid, Nuclear, Politics, President Obama, Reid

Blue Dogs Singing The Blues

In my desperate attempts to find news not about Anthony Weiner, I went to POLITICO’s website and found an article about Blue Dog Democrats, or I should say, the lack of Blue Dog Democrats in Congress. The Blue Dog Caucus was started in 1995 and was always a thorn on the side of liberal Democrats of the west coast and north east. Whenever it came to taxes, health care, and especially the farm bill, these moderates always seemed to have the upper hand.

Coming from the Dakota’s, Tennessee, Kentucky, and “Pennsyltucky,” these Congressmen and women would always use the same argument; our “rural” constituents don’t want more spending, so I can’t vote for this unless I can tell them how they will benefit from it. Or they would lay the guilt on the Democrats in safe seats and rant about how in order to keep the majority the liberals need to put together more moderate policy proposals. Well guess what, the Democrats did pass moderate legislation that benefited every single state in the union, and they still lost.

According to the article “The Blue Dog decline has been sharp, to put it mildly. Following the 2008 elections, the coalition counted 54 House members. When the dust settled from the 2010 midterms, just 25 remained.” Of course if they were real Republican’s it would be a lot easier for them to win reelection. They do come from more conservative districts, but I find it hard to believe Blue Dogs lost because of the policies that were passed between 2008 and 2010.

The hardest votes Speaker Nancy Pelosi had to get were for the bailout, stimulus, and health care, and had to work hard to convince the Blue Dogs. They were worried about keeping their job, and since the media and Republican’s hit the panic button whenever they get a chance, they have to go with the flow. The communications staff of House and Senate members (usually between 2-5 people) don’t have the time or tools to work on all the stories the media is covering. Most congressional offices have a policy of sticking to a limited amount of stories that make the member look good. But Blue Dogs can’t say the Democrat’s didn’t try to help them.

One of the biggest bills (and one that gets the least attention) was the Farm Bill in 2008, which is set to expire in 2012. It always carries huge subsidies for America’s least productive industry (1.2 percent of GDP) but there is never, ever, a debate of whether it should be passed. As far as the people who benefit from it are concerned, the more people who can benefit from it the better, and you can forget all that deficit stuff. The subsides in this law are with billions. I will also be writing a letter to Anheuser Busch. Since the law extended the tariffs for ethanol allowing local breweries to charge less to bars, I want to know why I still have to pay triple the price for a Budweiser.

Both Democrat’s and Republican’s need a wide variety of candidates in order to keep the gavel. The difference is while Democrat’s make a big deal out of their differences, Republican’s pretend there aren’t any. When the Democrats took back the House in 2006, there were stories coming out of Blue Dogs telling their leadership they were the reason they control the House. But the leadership should have reminded them about all the money they so the Blue Dogs could have their seat.

There will be Blue Dogs coming back in the next year, and yes it will help the Democrats get control of Congress, but that doesn’t mean the Democratic leadership should bow down to their every wish. If they wind up losing their seat it’s because their constituents didn’t see what their representative did for them. But if you look at what the GOP has accomplished this year (cut to Eric Cantor trying to fix his whip), and considering the seriousness of the issues coming up (cut to John Boehner crying), Democrats should stop singing the blues and replace it with rock and roll.

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Filed under Budget, Congress, Deficit, Democrats, Politics, Uncategorized

Policy and Debt Collide

After failing to pass a “clean” debt vote, Republican’s in Congress are looking for a compromise. The Hill reported today that Senator Jon Kyl said “the GOP would look to a shorter-term increase in the debt ceiling if the talks fail to produce more than $2.5 trillion in cuts.” The Treasury has been dipping into reserve funds to forestall the worst case scenario, but those funds will run out in July, and it looks like the GOP is still willing to play politics until the very last moment.

It left me with two questions. 1) What is Kyl thinking? $2.5 trillion worth in cuts?! In a time where most states are strapped for cash Republican’s have decided that cutting social programs that millions of American’s rely on is OK by them.

Plus, what is a “short term” increase? Congress has voted to raise the debt ceiling every year for the past decade. If the time period is any shorter than that, it means the Republican’s aren’t kicking the can down the road, they’re crushing it.

If you’re a politician, the rule of thumb you follow in any crisis is to do no harm. Well, many families are in a crisis right now, and by not raising the debt ceiling Congress will be doing them harm. All the positive “estimates” that economists made for 2011 will be wiped out because, as the U.S. is already broke, there won’t be any room to make the investments it needs to execute programs that will help create jobs or make sure families are taken care of. As the majority of the debt is for paying programs such as Medicare and Social Security, asking for $2.5 trillion in cuts means these vital programs will be a part of it.

2) Can the Republican’s do math? Even though the Congressional Budget Office has stated numerous times The Affordable Care Act will reduce future deficits, all the GOP talks about is how it will ruin America. But as it will help our fiscal situation, it also saves lives. The law forbids insurance companies from saying no to certain medical treatments, and giving parents the ability to keep their children insured under their plan until they are 26. It also includes tax credits for small businesses, and makes sure seniors can pay for their prescription drugs. I’m not making this up.

But politics has succumbed over policy once again. The Affordable Care Act is better known as Obamacare, and recent polls show 47 percent of American’s do not want the debt ceiling raised. A Pew study also found the majority of people are not in favor of raising taxes or cutting benefits. But this is not because they are irrational people, it’s because they don’t have enough information. Our “leaders” in Congress are supposed to tell us what we need to know so we understand the actions they are taking. Instead, it has become a battle of words and trying to figure out which ones will position their party or candidate to win the next election. Instead of calling them out on it, the media focuses on it and polls the candidates that don’t even try to have credibility.

If the emergency funds run out and the debt ceiling isn’t raised, it means America will have to default on its loans, leading to an even worse economic down turn than the one we’re still recovering from. President Obama has said his decision to vote against raising the debt ceiling while still in the Senate was a mistake; it’s the Republican’s turn to stop playing politics and deal with the matters at hand.

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Filed under Congress, debt ceiling, Jon Kyl, Politics, Republicans