Tag: deficit spending

Michele Bachmann, God’s Press Agent. Eric Cantor, God’s FEMA Director

Michael MatheronLeave a comment

August 30, 2011

“I don’t know how much God has to do to get the attention of the politicians.
We’ve had an earthquake; we’ve had a hurricane.
He said, ‘Are you going to start listening to me here?’ “

 Michele Bachmann, August 28, 2011, Sarasota, Florida,
relaying God’s growing displeasure with Congress

Ms. Bachmann is correct. Certainly, if I were God, I’d be displeased with the political class. God’s notoriety for biblical-sized temper tantrums is well-earned. Floods. Fire. Brimstone. Brimstone and fire. He’s especially fond of plagues – frogs, locusts, boils, lice, my next-door neighbor. Yes, the Creator is omnipotently equipped to rain down a variety of “hints” when it suits His purpose. The recent eastern seaboard earthquake and hurricane match the Supreme One’s M.O. Agreeing with Bachmann in this case is easy; I too see that God’s sole purpose was to get the attention of politicos of every stripe. Everyone else – whether floating on a rooftop in Vermont’s Winooski River, or trapped in Prattsville, New York with no way out – you may relax. The unpleasantness was not directed at you.

But what, exactly, have our political folks done to get God’s robe in a bunch? Lapses in ethics? Sleeping with anything that moves? Making criminal for others activities they engage in on a daily basis? Permitting David Vitter to remain in the Senate? No. No. No. And No. According to Ms. Bachmann, Yahweh’s press secretary, this wrathful acting out was fiscal in origin, not humanitarian. Last Sunday, the sage of Minnesota explained to her Sarasota Florida audience exactly what God was trying to convey to tone deaf national legislators, and a certain President: “Listen to the American people because the American people are roaring right now. Because they know what has to be done. They know government is on a morbid obesity diet and we’ve got to rein in the spending.”

Nudge, Nudge, Wink, Wink. Congressdwellers, primarily Democrats of course, reverted to their political default setting of touchy-feely whininess urging government funded disaster relief for citizens floating down various rivers. One prominent politician, however, the GOP House Majority Leader Eric Cantor (VA-7), clearly understood a divinely inspired hint. Mr. Cantor, first among all his tightfisted GOP colleagues, apprehends God’s fiscal concerns. Cantor knows that at such an advanced age, God is getting increasingly testy, i.e. Old Testament testy, Old Testament remedy testy. Like many in God’s age group the day’s concerns revolve around making the rent, funding an affordable medi-gap Medicare supplement, stretching that monthly social security check, and finding the car keys at least three times per day. And taxes! Oy! A klog tzu meineh sonim! Or in colloquial English, “Oy! A curse on my enemies!” So, one can see, what God does not need is more federal spending that does not directly benefit. . . G.O.D. And God does not reside in an earthquake or hurricane disaster area. Think. Would an omniscient God smite Himself with His own earthquake and hurricane?

Mr. Cantor gets it. He gets hints. His own congressional district, after all, was the epicenter of the quake. Tanya Somanader at ThinkProgress reports: “While touring the earthquake damage in his district, Cantor surmised, ‘Obviously, the problem is that people in Virginia don’t have earthquake insurance.’ As the Insurance Information Institute notes, ‘earthquakes are not covered under standard U.S. homeowners or business insurance policies, although supplemental coverage is usually available.’ So, for Cantor, the problem here is that Virginians didn’t have the foresight to predict an exceedingly rare natural disaster and pay out of their own pocket in advance.”

Exactly, Ms. Somanader! Fiscally responsible constituents would have purchased earthquake insurance. And flood insurance. And to be safer yet from the pesky acts of a disgruntled Supreme Being, one ought to cowboy up on plague insurance and secure oneself from losses due to frogs, locusts, boils, reality television, Newt Gingrich, teenagers, and golf. I have these forms of insurance. In addition, I purchased glacier insurance and, because I suspect my next-door neighbor, I possess a zombie damage policy. This is what Mr. Cantor would correctly label “responsible.” If a next-door zombie devours my poodles, I will not require government assistance. Will you?

Pay As You Row. As he observed the damage to his Virginia district, Mr. Cantor continued to opine: “The next step will be for Virginia Gov. Bob McDonnell (R) to decide whether to make an appeal for federal aid,” Cantor said. The House Majority Leader would support such an effort but would look to offset the cost elsewhere in the federal budget.“All of us know that the federal government is busy spending money it doesn’t have,” Cantor said in Culpeper, where the quake damaged some buildings along a busy shopping thoroughfare.

And why should he? Certainly, there are many “potential offsets.” Why can’t Medicaid freeloaders contribute to disaster relief? And since Medicare and Social Security are unconstitutional, let’s carve out a few bucks from these Ponzis. Moreover, FEMA is a boondoggle. Let’s close it down! Let Goldman Sachs privatize disaster relief with catastrophe backed securities. With those money saving offsets perhaps we might loan Vermonters a few bucks to buy hurricane and flood insurance from Mr. Cantor’s insurance company contributors who, during his ten year congressional career, have contributed $1.1 million to his campaigns. They’d appreciate some ROI.

The lessons God graces us with during His latest calamity rage out are simple. I’ve put my mind to it and here’s my take:

  • God is good, but cranky.
  • “Acts of God” are generally unremitting in unpleasantness.
  • Disasters are the free market stomping on your private parts.
  • Insurance makes disasters profitable enterprises for nearly everyone.
  • Government is Satanic.
  • Newt Gingrich is an insufferable ass.

White House Debt Summit Tomorrow – Will Obama Cave or Pave?

Michael MatheronLeave a comment

July 6, 2011

Tomorrow morning President Obama hosts some friends and enemies at his big white house. They’ll powwow about bills for this and bills for that. Who will pay for them?  Will we pay for them at all? Can we even afford a weekend summer vacation in Arlington, Virginia, just across the Potomac River? The big question, though, suggested by an unsettling report by WaPo tonight, is whether President Obama is ready to sell the ranch, lock, stock, and barrel.

Cave Or Pave?  The Washington Post reported tonight that “President Obama is pressing congressional leaders to consider a far-reaching debt-reduction plan that would force Democrats to accept major changes to Social Security and Medicare in exchange for Republican support for fresh tax revenue. . . As part of his pitch, Obama is proposing significant reductions in Medicare spending and for the first time is offering to tackle the rising cost of Social Security, according to people in both parties with knowledge of the proposal.”

My fondest hope is that he doesn’t really want to put much of Medicare or Social Security on the table, if at all.  I can’t believe – I must not believe – he’d cave again as he did last December.  Or will he pave the way to GOP humiliation?

My gentler angels suggest that the Medicare/Social Security talk is a political gambit designed to highlight the GOP anti-tax jihad, and to further isolate them as the stumbling block to a budget (and debt ceiling) agreement. The President may be betting all-in that he can win on his home field when he meets congressional leaders at the White House tomorrow. 

There, afterwards, he can roll out the bully pulpit and go directly to the American people. Tomorrow, if the GOP resists even the slightest amount of tax revenue increases, he can herald it to a nation where many cannot understand why the wealthiest among them should not pay a fair share. GOP stickiness on taxes is well-known, of course. House Majority Leader Eric Cantor (R-VA), for example, agreed to discuss the elimination of tax breaks like the one for corporate jets, yet – remarkably – he refused to do so if an eliminated tax break resulted in any increase whatever to federal revenues. Here’s how much he’s willing to budge on increasing tax revenue: “If the president wants to talk loopholes, we’ll be glad to talk loopholes . . . we’re not for any proposal that increases taxes, and any type of discussion should be coupled with offsetting tax cuts somewhere else.”

How generous of him.  In any event, even that “concession” – worthless as it is – was kiboshed by Senate Minority Leader Mitch “We look a lot like Greece already” McConnell (R-KY). 

The hypocrisy stuns, as always. Remember – as a commenter at Political Animal did:

“John Boehner, Mitch McConnell, Eric Cantor, John Kyle, etc.all voted for multiple debt limit increases and multiple budgets that included deficit spending (before we had a Democrat in the White House). If Mitch thinks we are like Greece, then he can look in a mirror and see the reason.”

Mirror, mirror, on the wall . . .

More Economic Pain on the Way for States and Local Communities, Courtesy of the U.S. Congress

Michael MatheronLeave a comment

March 10, 2011

Recently, the Center on Budget and Policy Priorities issued a survey of state budget concerns.  Their comments about federal assistance to states and localities are not optimistic: “Federal assistance for states, which has been enormously helpful in allowing states to avert some of the most harmful potential budget cuts, will be largely gone by the end of fiscal year 2011, the current fiscal year. . .”

The GOP/TP fiscal jihad that is taking place in the House of Representatives, using H.R. 1 as its present vehicle, cuts valuable and critical financial resources from federal assistance to states and localities:

“The Fiscal Problems Of State And Local Governments Have Also Had National Implications, As Their Spending Cuts And Tax Increases Have Been A Headwind On The Economic Recovery.” Federal Reserve Board Chairman, Ben Bernanke Speech At The Citizens Budget Commission In New York, March 2, 2011.

Challenges For State And Local Governments

A Sampling Of H.R. 1 Cuts
Adversely Affecting States And Localities

• Community Development: H.R. 1 Would Cut The Community Development Block Grant (CDBG) Program From $4 Billion To $1.5 Billion – Nearly Two-Thirds (62 Percent).

• Head Start Early Childhood Education: Head Start Is Providing Comprehensive Early Childhood Services To Almost One Million Low-Income Children And Their Families. The Cut Of $1.1 Billion, Or 14 Percent, Below The FY2010 Appropriation . . . Causing Nearly 218,000 Children Across The Country To Be Kicked Out Of The Head Start Program This Year, A 20% Cut And Close More Than 16,000 Head Start And Early Head Start Classrooms.

• Railroads And Transit: The Bill Cancels Over $3 Billion In High Speed Rail (51 Projects In 22 States) And Surface Transportation Projects (TIGER Grants = 76 Projects In 40 States) That Were Awarded With Fiscal Year 2010 Funds. These Projects Are Estimated To Have Created More Than 100,000 New Construction Jobs.

• Public Safety: The CR Cuts Funding For Justice Department State And Local Law Enforcement Grants By Over $1 Billion, Or 27 Percent (Including COPs, The Office Of Justice Programs And The Office Of Violence Against Women).

With state governments also, by and large, cutting programs and state employee salaries, the GOP fiscal jihad is trickling down to what economists like to call Main Street. Moreover, what is not generally discussed in the media is the fact that states themselves provide assistance and grants to local governments – Main Street as a reality, not a metaphor. As federal aid to states declines greatly for the foreseeable future under GOP plans, states’ abilities to provide funds to localities also will decline, and, let’s face it, many states already are planning these cuts despite the loss of significant federal grant money. Then, of course, on Main Street, community services are cut substantially, everything from law enforcement to school teachers.  That’s trickle down economics, RepubliCut style.

And even without this huge round of federal and state budget cuts many U.S. Main Streets, for years now, have been awash in unemployment, community decline, and rising poverty. The combination of state and federal cuts coming in the remainder of 2011 and 2012 will, I fear, dampen the very mild recovery we are experiencing now, and, to carry the metaphor maybe too far, drown the national economy in another deep recession, or worse, including widespread social unrest, making Madison, Wisconsin seem tame.

A week ago, Federal Reserve Chairman Ben Bernanke, addressed the Citizens Budget Commission of New York about this growing problem.  As a leading former member of George Bush II’s economic team, Chairman Bernanke is no cheerleader for governmental spendthrifts.  Yet, below, he also appears nervous about the massive cuts in the pipeline; I don’t like our Ben nervous . . .

“The recession’s effects on state governments have been substantial. In calendar year 2009, state tax revenues were about 12 percent lower than they had been in 2008; declines in wages, salaries, capital gains, and profits reduced income tax revenues, and sales tax collections dropped along with household and business spending. Reflecting somewhat better economic conditions, state tax revenues for the first nine months of 2010 were 3 percent higher than during the comparable period a year earlier–a relatively modest improvement in comparison to the earlier decline. Meanwhile, on the spending side of the ledger, demand for publicly financed medical care and other public services soared as the economy weakened. Most notably, Medicaid caseloads rose from less than 43 million at the start of the recession in December 2007 to more than 50 million in June 2010–an increase of nearly 18 percent. . .

“In contrast to the sharp drop in state tax revenues, local tax revenues across the country have held up relatively well over the past couple of years. In part, this difference reflects localities’ greater reliance on property taxes. Changes in real estate values typically feed through to tax assessments and property tax bills with a considerable lag; some jurisdictions have also raised their property tax rates to offset weakness in assessed values. The continued softness in real estate prices, however, does not bode well for local government revenues. Moreover, many localities have been hard hit by reductions in state aid, which in 2008 accounted for about 30 percent of local revenues. Indeed, the fiscal 2011 budgets of more than 20 states contained either outright reductions in local aid, changes to revenue-sharing agreements, or cuts in funding for specific programs that are run by local governments–such as education for grades kindergarten through 12, road maintenance, and property tax relief.

“Assistance from the federal government–mainly through the stimulus grants included in the American Recovery and Reinvestment Act of 2009 (ARRA) and the additional Medicaid and education grants provided last summer–has relieved some of the fiscal pressure on states and localities. In addition, many of them have tapped financial reserves–or “rainy day” funds–and pursued asset sales and other one-time actions to satisfy balanced budget requirements.  Nonetheless, many governments have laid off or furloughed workers, frozen salaries, and cut other operating expenses. Job cuts have been especially pronounced at the local level, where payrolls have fallen roughly 350,000, or more than 2 percent, over the past 2-1/2 years; nearly half of the loss of local jobs has been in education.

“In addition, state and local governments have cut their capital expenditures. To be sure, construction of highways and transportation facilities has been well maintained over the past couple of years, partly because of the infrastructure grants and the Build America Bond program provided under the ARRA. . .

“Although the economy is recovering, it is still operating well below potential and unemployment remains high. Stimulus grants from the federal government are winding down this year and will largely have ended by 2012. Demands on Medicaid and other social service programs will likely remain elevated. Moreover, reserve funds are low, and the list of unused one-time fixes has been substantially depleted. . .

“. . . the fiscal 2011 budgets of more than 20 states contained either outright reductions in local aid, changes to revenue-sharing agreements, or cuts in funding for specific programs that are run by local governments–such as education for grades kindergarten through 12, road maintenance, and property tax relief.”

GOP/TP Cuts Have Consequences, Too. Republicans like almost any word or phrase that precedes “have consequences.” Holding them to that when they’re the punch line to “have consequences” has generally failed. But extreme budget cuts at any governmental level bode poorly for an economy only slightly on the mend. Recall that despite a mild softening of unemployment last month (and to be revised next month), the ranks of the unemployed do not, by any measure, signal a return to prosperity. The long-term jobless rate is at a record percentage of the unemployed, more than a million of whom have been out of work – and most of them still looking – for two or more years.

A Lexicon. No matter what, this is the place where the rubber meets the road for GOP/TP economic theory which basically features a number of morally and economically suspicious principles. Here are a few of the GOP’s mantras that come to mind:

  • what’s mine is mine, and what’s yours is mine too (Hosanna Ayn Rand!)
  • cut taxes savagely, particularly on the wealthiest 10%
  • cut spending savagely on everything that does not benefit the wealthiest 10%
  • privatize everything to benefit the wealthiest 10% at the expense of the dwindling middle class and the poor, and, the corollary, inevitably run privatized public services poorly with the eye primarily on the bottom line
  • steal whatever tax revenue received via the middle class and the poor and recycle it through federal contracts, privatization, and old-fashioned theft to the wealthiest 10% (this is called Kleptocracy!)
  • financial regulation gets in our way! Period. Paragraph.
  • and bringing things strangely in a full circle, almost all tax cuts increase government tax revenue (Hosanna Arthur Laffer, Peter Stockman, Ronald Reagan, John Boehner, Mitch McConnell, etc., etc., ad nasuem)

There’s more, of course, but I’m tired and need to get back on my meds. 

Avoiding Despair Over the Federal Budget Process

Michael MatheronLeave a comment

February 14, 2011

Key Terms, Budget Process

Hate It Now, Hate It Later. Today, President Obama delivered his budget proposals for fiscal year 2012 (Oct. 1, 2011 – Sept. 30, 2012) . In the days ahead we’ll be hearing more and more about the federal budget proposals. Talking heads and headstrong politicos threaten to explode our heads.

We know from long experience that the budget process is a yearly dance of death, and this year the choreography is far more unstructured and unpredictable than usual. Sort of post-structural, on the border of surreal and loony. The aging GOP and the new group of youthful Tea Partiers are already ungracefully stomping on each other’s feet.  The Dems and President Obama are more compatible partners, yet it’s a close call, and some in the House and Senate chorus line seem a bit nervous and perhaps even rebellious.

Block That Metaphor! Please!  Moving away from the dance metaphor, – this year’s budget battle is more like a demolition derby – the process threatens to topple long-standing programs and to block anything new. It also will, I’m guessing, quickly put the new era of civility, born in the aftermath of the Arizona mass shooting tragedy, quickly in the rear mirror.  The competing interests are in some cases light years apart – both the GOP and the Democrats, especially, will be challenged by the Tea Party jihad. Already, Tea Party opposition to the GOP-proposed cuts in what remains of this year’s budget cause John Boehner to agree to billions more in proposed cuts. (Before long, Boehner and others won’t have any revenue to give away to insurance companies and oil interests. Then what will they do for a living?)

The budget process over the years has become more and more impenetrable; I think it’s not happenstance, either.  Our leaders cannot even agree what’s a budget item and what’s not, witness Social Security. This post will not help with the politics but will enable you to find some of the resources you need to keep your eye on the money as it leaves the building . . .

Here’s some items of interest to have in your “Budget Info” bookmark. While these pointers are not exhaustive, I hope they help you become a better budget snooper.

1. Two weeks ago, the Washington Post published a simplified and “interactive” guide to the federal budget process, The Federal Budget Process.  In timeline fashion, the primer includes basic concepts of federal budgeting; the presidential and the congressional budget process; spending; revenue; and reconciliation.  In a bow to the obvious, the writer points out that these benchmarks are rarely achieved on time . . . So, if you’re short on federal budget savvy, this is an easy starting point.

2.  The Congressional Research Service (CRS) is the primary research agency for Congress. CRS resides in, and is a component of, the Library of Congress, located at the center of Capitol Hill.  One of their 1998 reports, Introduction to the Federal Budget Process, provides in-depth coverage of the unholy mess called federal budgeting. 

3. Congressional Committees. The House Budget Committee website is a great one-stop shop for budget matters with links to other budget agencies and budget data. Also, the site links to the Minority (Democratic) site as well.  The Senate Budget Committee website is, like the House website, a portal to both the Majority (GOP) site and to the Minority (GOP) site, both of which offer a full plate of budget information and links.

4. The Congressional Budget Office (CBO) – “CBO’s mandate is to provide the Congress with: Objective, nonpartisan, and timely analyses to aid in economic and budgetary decisions on the wide array of programs covered by the federal budget and the information and estimates required for the Congressional budget process.” Their duties in the budget process are described here.

Hate It Now, Hate It Later? So, while this may possibly not cause you to “love” the federal budget, and perhaps not even cause you to “like” the federal budget, maybe it’ll help you “tolerate” it. Or maybe just hate it a tiny bit less. If so, my work is done here.

Incoming Speaker Boehner’s House Threatened by Termites

Michael MatheronLeave a comment

 January 6, 2011

Does he have the punching power?

John Boehner Is In The House!  Ohio Republican John Boehner, sworn in yesterday as the Speaker of the House for the 112th Congress, has come a long way from his simple beginnings in Cincinnati as the second of 11 siblings. Raised in near poverty in a two bedroom house, and forced to share a single tanning bed with his sibs, John Boehner – now Speaker Boehner – is third in the line of presidential succession. Boehner’s well-known work ethic has paid off, but more work lies ahead as he seeks to repair the damage wrought by those Socialist Democrats. He and his fellow Republicans look upon their rivals like the Omega Theta Pi’s viewed the Deltas in Animal House.

As Speaker, he must manage a House, reclaimed through November’s GOP triumph, that needs some fix-up. Democrats, as usual, left a few dozen beer bottles in the sofas, cigarette burns in the carpet, condoms in the trophy case, and a few togas on the floor – but nothing truly threatening to the clubhouse’s foundation.

Never Underestimate the Power of Termites.  It’s the possible damage lurking in the months ahead, however, that is perhaps Speaker Boehner’s most challenging problem. The moribund-on-a-good-day Democrats are little more than an almost supernaturally timid gaggle of pols one may insult with careless abandon without fear of retort.

Just arriving this week and still searching for apartments and low priced diners, are the real dangerous folks challenging Speaker Boehner’s House, and his splintering GOP. This fifth column marching into the House represents a growing number of GOP malcontents. Among them are the rightest of the right wing. Some, they claim, are incorruptible, i.e., the “Constitutionalists.” Almost all of them want to strip the federal government to its underpants. SAnd, boy, do they hate taxes, with or without representation. Yes indeed, they are the Tea Partiers. Numbering nearly 100 House members (approximately 43 of them in the freshman class), these folks wanna rock the House! Bigtime. And imagine, they are too far right for John Boehner’s taste!

Aggressive Tea Partiers, like termites in attack mode, promise to munch on the joists unless treated with respect bordering on worship, which for most of them should be well beyond their “newbie” status. Given their propensity for stubbornness, though, if the Speaker is not careful, they may bring the roof down, with Republicans and Democrats, on the front lawn, mouths agape as their cozy living arrangement collapses.

Party Hearty! As we’ve all observed for almost two years, Tea Partiers view themselves as true believers, in their understanding of the Constitution, the role (if any) of the federal government, succumbs to their allegiance to the sovereignty of the states. They carry a hefty amount of self-purity into a House not known for squared corners or dust-free tabletops. As self-proclaimed purists they most likely will view legislative rules only insofar as they advance their own rather rigid beliefs, and squirm when confronted with the House legislative pecking order and seniority system. As second term Utah Representative Jason Chaffetz stated it when he refused to join the Michele Bachmann-inspired Tea Party Caucus,

“Structure and formality are the exact opposite of what the tea party is, and if there is an attempt to put structure and formality around it, or to co-opt it by Washington, D.C., it’s going to take away from free-flowing nature of the true tea party movement.”

Tea Party Caucus initiation ceremony

We can expect the Tea Party’s “free flowing nature” to resemble an Animal House toga party.

The array of formal and informal House rules are long-standing principles of engagement to protect precedents that, theoretically at least, benefit all club members and often cool off hotter heads. After a brief honeymoon period, these House rules very likely will rankle Tea Partiers who want to quickly get on with it. These rules stand like iron doors to protect an inner sanctum where Republicans and Democrats with ample seniority canoodle and, too often, conspire with the likes of lobbyists and high income bracketeers. Can termites chew through iron? 

“All you need in this life is ignorance and confidence, and then success is sure.” Mark Twain.  Tea Partiers, among many other of the 87 new GOP House members, are confident and in a hurry. New Tea Party Congressman Allen West of Florida, whose wealth-ridden district 22 stretches from Palm Beach to Fort Lauderdale, expressed some of this the other day on NPR when asked about health care reform. The newly minted Congressman spoke of free enterprise solutions and had this to say about about the Obama-inspired health care law:

“But I can tell you, you know, with my limited education, I can probably package that in five to 10 pages. The other 2,490 pages, that’s what we need to focus on.”

Now that’s confidence! “With my limited education,” indeed. 

Another Tea Party freshman, Rep. Frank Guinta, (R-NH), promised Diane Sawyer, “We will not spend more than we take in. Our families live by that rule.” Ignoring the odd conflation of morals with macroeconomics, and his ready illogic that a family budget is equal to a federal budget, Congressman Guinta displayed that earnestness, forthrightness, and moral certainty so common among Tea Partiers. Be cautious here: it’s true, these virtues have too often been built upon a foundation of ignorance, misinformation, grievance, and “Limbaughnian” propaganda, but that doesn’t blunt their importance and power among the Tea Party constituency.  We’re in “belief-based fact” territory here. 

How this will all play out for Tea Partiers during the daily grind of lawmaking will be both interesting and disturbing to watch. Interesting because despite disagreeing with their proposals, one can’t help rooting for a group of people who really believe they can get things done in D.C. and remain unreservedly aloof from the Monopoly game called legislating. Fascinating too will be Speaker Boehner’s approach to a concerted group so far to his right that this stalwart and very arch conservative seems in comparison a Mahatma Gandhi. How will Speaker Boehner fare? Who will he turn to? How strongly will the Tea Party push him? Against all this on his right wing, will he be able to cobble together anything remotely resembling a unified GOP for the 2012 election cycle?

Tea Party performance in the 112th Congress may well have its disturbing scenes as well.  Can they succeed in some of their wilder and, frankly, disgraceful plans like refusing to lift a fiscal finger to assist the unemployed, or cutting benefits and tax breaks for the poorest among us?  Will they succeed in capturing enough media attention – thus far, it’s Tea Party all the time at Fox and other major networks – to, God spare us, successfully launch the likes of a Michele Bachmann, Rand Paul, or Sarah Palin on a third party cruise in 2012?

Or, quite to the contrary, will the trappings that ensnared other “true believers” of the right wing like Tom Delay and Newt Gingrich ensnare and defeat naive or acquisitive Tea Partiers in their first exposure to the lobbying boodle machines on K Street?  After all, free enterprise touting legislators have been ensnared before in the act of offering their power as a marketable commodity that may be freely contracted out. 

This Tea Party, though, is different, more out of control than other iterations, more slack jawed. They are primal. Watch them carefully; take them seriously.

Incoming GOP Government Reform Chairman Darrell Issa to Big Business – “Give Me My Marching Orders”

Michael MatheronLeave a comment

January 5, 2011

Corporations Have Feelings Too. Cento-Millionaire House member, Darrell Issa (R-CA), announced that he will form a new club on Capitol Hill to protect put-upon corporations from regulatory discrimination. Issa’s ascendancy to the Chairmanship of the House Oversight and Government Reform Committee promises to put on display the beliefs and attitudes that earn him a consistent 90+% voting record from the American Conservative Union. In fact, as Chairman of the only congressional committee with “reform” in its title, Issa views the reform of government as akin to deconstruction bordering on chaotic demolition. Imagine, Darrell Issa, arch-conservative-post-structuralist!

Mobilizing his forces quickly, Issa sent a flurry of letters to club member corporations and trade associations requesting his marching orders.  According to Politico, Issa’s missives included the American Petroleum Institute, the National Association of Manufacturers, the National Petrochemical and Refiners Association, Bayer, and approximately 150 other club members. As you’ll read below, he sought their opinions on which governmental (read, “Obama”) regulations were especially off-putting. Here’s presumptive Chairman Issa’s letter:

“The Committee on Oversight and Government Reform is examining existing and proposed regulations that negatively impact the economy and jobs. In fiscal year 2010, federal agencies promulgated 43 major new regulations. These regulations ranged from new limits on “effluent” discharges to new rules for Nationally Recognized Statistical Rating Organizations. The new limits on “effluent” discharges from construction sites will cost $810.8 million annually resulting in the closure of 147 construction firms and the loss of 7,257 jobs. In total, the administration estimated the cost, often referred to as the hidden tax, of the 43 new regulations to be approximately $28 billion, the highest single year increase in estimated burden on record, resulting in thousands of lost jobs. This new burden is on top of the $1.75 trillion estimated burden of existing regulations. As a trade organization comprised of members that must comply with the regulatory state, I ask for your assistance in identifying existing and proposed regulations that have negatively impacted job growth in your members’ industry. Additionally, suggestions on reforming identified regulations and the rulemaking process would be appreciated. Please submit your response as soon as possible, preferably before January 10, 2010.”

Issa’s spokesloon, Kurt Bardella, got to the gist of it in appropriately plaintive voice: “Is there something that we can do to try to ease that [regulatory] burden and stimulate job creation?” he added. “Is there a pattern emerging? Is there a consistent practice or regulation that hurts jobs?”

Bloomberg.net reports that Issa spokesloon Bardella waxed on about the plight of America’s corporate downtrodden, perhaps bringing tears to listeners’ eyes :“Maybe this disdain for job creators is why the current policies in place have failed to create the type of long-term, permanent jobs the American people were promised,” said Bardella. He said the committee aims to gain “insight from job creators who have felt shut out of the policy process so that we have a better understanding about what regulatory barriers are standing in the way of job creation.”

This, of course, ignores the fact that corporations and associations are embedded up to the hilt in the influence game Bardella calls the “policy process.” There is no member of Congress who does not regularly get throttled by business-oriented lobbyists.

Also, as for “job creation,” Bardella apparently fails to comprehend the enormous loss of middle class consumer wealth during our ongoing Dubya Decession, and the consequent shrinkage of aggregate demand for goods and services that then resulted in substantial unemployment and underemployment.

Issa’s Zombieconomy Gang. Furthermore, as head of the Government Reform Committee, Issa will ensure that supply side economics –the GOP clarion call since Reagan – rises once again from its dirt nap. Supply side’s terribly battered right hand man, deregulation, despite its recent massive failures, will become the primary cudgel of Issa’s vitally important committee. In this Issa in Wonderland world, policies that caused the Dubya Decession, especially deregulation, will be revived as its cure. As Paul Krugman and John Quillen say, zombie ideas are hard to kill.

This GOP infatuation with supply side economics of the Laffer variety – at its best, an economic theory of highly limited application – ignores the readily available evidence: government revenue fell and economic progress nosedived due, in large part, to Bush’s unfunded tax cuts (and years of financial deregulation, etc.). Moreover, tax revenues rose at first after Bush’s tax cuts, but only due to a surge in corporate profits, and then revenues quickly dropped. Remember, too, these heralded growth enabling tax cuts have been in effect for seven years, long enough to demonstrate their efficacy, or not. And recall that under Clinton we emerged in 2000 with a surplus, despite what GOP and libertarian supply siders considered a confiscatory tax rate of 39% on the highest earners.

As for the deficit, the Big Lie is that the GOP cares about the deficit. They do not. Their policies are pro deficit, particularly the fiction that tax cuts need not be paid for because the (ignominious) Laffer Curve guarantees that the lower the tax the higher the government’s tax receipts. Here’s some data. Note the explosion of the deficit during the Reagan and Dubya years, after their large tax rate decreases.

President

Years as
President

National Debt
at Inauguration

National Debt
at End of
Presidency

% Increase in Debt
Over Entire Presidency

% Increase in Debt
Per Each 4-Year Term
Jimmy Carter4$706 billion$994 billion41%41%
Ronald Reagan8$994 billion$2867 billion189%94.5%
George H.W. Bush4$2867 billion$4351 billion52%52%
Bill Clinton8$4351 billion$5769 billion33%16.5%
George W. Bush8$5769 billion$10413 billion81%40.5%

Finally, courtesy of Rocky Mountain Institute, is data on GDP growth from 1900 to 2008. Note the refutation of the GOP meme that the rate of GDP growth is always adversely affected by a high tax rate: for example, from 1950 to 1973, a period of what the present day GOP would call confiscatory tax rates on the highest earners, GDP grew 250% in less than 25 years.

In Conclusion.

“The only chance we have to contain this is to vaporize
every living thing aboard that aircraft.”
– Pentagon General, Flight of the Living Dead:
Outbreak on a Plane (2007)

Fight the zombieconomists!  Or they’ll eat your social class for lunch . . .