Wordle of the SanityPrompt

Why the Left is So Mad - Pt II

This shows shockingly bad judgment on Peter Orzag's part and goes to the heart of the Left's complaint with this Administration. Despite a campaign based on promises of change and addressing what Washington had become, in its bailout of banks, its tolerance of corporate theft by CEOs (AKA - executive compensation and bonuses), its stimulus, it's failure to push hard for a public option, its indifference to the most progressive and necessary of financial reforms, it has worried progressives that today's Democratic leaders and wonks are so embedded in the oligarchic power structure of the country that they cannot change it.

Does Peter Orszag Have No Shame? - The Daily Dish | By Andrew Sullivan:

That they are perhaps its embodiment.

Why The Left Is So Mad

There's a lot of head shaking going on at the White House and in pundit circles right now about those 'crazy progressives' who want to scuttle the Obama-McConnell tax deal. If you want to understand why they're so pissed off though, it would behoove interested parties, such as, say, a President who may be seeking re-election in 2 years, to try and uncover the source of the anger instead of assuming they fully understand it.

In the bunker mentality that is any Democratic White House, the enemies appear to lie on all sides so it's easy to scoff that those crazy liberals just don't get it. They want the ideal, or so Obama proclaims, and then he proudly proclaims that he is a pragmatist and wants to get things done. And the political center applauds him. The Right is still unimpressed and the Left fumes.

So what gives? Are the liberals simply impassioned radicals who would sacrifice progress for principle? Can they not see the good that will come from an extension of unemployment benefits? Can they not appreciate that the deal provides about $120 billion in benefits to those with incomes over $250,000 and about $400 billion in benefits (that had been opposed by Republicans) to those who live paycheck to paycheck?

As the dust settles I am sure progressives will come to see the merits of this deal. Hopefully they will also come to see the political realities that Obama faced. It's true Obama could have stared down the GOP and tried to argue in January, when taxes went up, that the GOP was responsible because they preferred tax increases for everyone over tax increases on the rich.  But the fact is that January would have seen a GOP Congress' first order of business being an across the board extension of all tax cuts, no pay roll tax cut for working people, and no unemployment benefits extension.  Then, the Democrats in the Senate or the White House would have had to veto a GOP extension of Bush tax cuts for all. Democrats would have instantly lost the ability to accuse the GOP of increasing rates.

What the White House fails to realize though is that the deal isn't what drives progressives and liberals crazy. It's the lack of fight. It's the appearance of a preference for deal making over any kind of stand on principles (or self respect for that matter). And that may describe Obama perfectly.

But what they cannot square at all is why Obama appears to save his sharpest rhetoric, most pointed barbs and most strident anger for them. Take the example being shown now around this very tax deal.

WH warns tax defeat could trigger new recession - Yahoo! News

Who comes in for the sharpest criticism? Those 'idealists.' Who is threatening recession? Those 'idealists.' Who is endangering the welfare of the country? Those idealists.

Those idealists stand around looking at each other bewildered. They think - 'You're being called a socialist Muslim terrorist by the other side and they are obstructing good economic policy (tax cuts for the middle class, health care reform), social policy (DADT), and security policy (START) -- but WE are the one's threatening the welfare of the country?"

I'm sure the White House doesn't remember this incidenty but I can tell you most progressives do. This summer, just weeks after folding like a cheap suit on the public option, Medicare drug negotiations, and all other manner of good, progressive, fiscally sound health policy without so much as a whimper, let alone a cry of anger, the White House threatened to veto Financial Reform. What got their anger up? Was it some poison pill from the Right? No, it was a modest proposal to audit the Fed for its role in the TARP bailout of banks.

Noam Schreiber ascribes the most recent deal to the GOP victories in November, arguing that this finally allows Obama to be the President he always wanted to be. Here's another reason that Progressives tear their hair out. Obama would rather govern with a GOP House and only 53 Democrats in the Senate than with a solidly Democratic House and almost 60 votes in the Senate?

To believe Obama prefers to govern under the first scenario, one would have to assume Obama is much much more conservative than the middle of Congress was in the just past Congress. Or one would have to assume that Obama prefers the image of the dealmaker to actually getting progressive victories like Health Care Reform and Banking Reform and improving the lot of the working and middle class. Neither possibility is very reassuring to progressives.

What drives progressives and liberals crazy is not that Obama is a pragmatic deal maker. It's that he doesn't appear to share their values at all.

The White House doesn't see that it's lost credibility with the Left because it HAS threatened stands on principle -- but those stands have typically been anti progressive or targeted against progressives.

When it's come to taking a stand on gay rights, on progressive policies like the Public Option, on rational security policies like opposing torture, illegal incarceration or ending the disgrace that is Guantanamo, or fighting for truly progressive financial reforms Obama has raised a limp hand and whispered "I'm with you." When it's come time to standing with the policy elites and the centrists of the Treasury, his economic council, or the New York Times editorial page though, Obama has been much more strident and forceful.

It's not that Obama is a progressive pragmatist that upsets. It's that Obama hasn't convinced anyone on the Left that he truly cares about anything those on the Left have cared so much about. They get that he's pragmatic. What they worry is that he's really not progressive at all. And that should be of genuine concern to this White House. Progressives will never vote Republican. But 40 million voters from 2008 stayed home in 2010. 3 million 'idealists' voted for Nader in 2000. Disillusioned Leftists make good fodder for ribbing at White House cocktail parties, but laughing at or scoffing at your base's principles makes for very bad politics.

Somehow Obama is going to have to convince them that there are just some things he won't compromise on. Clinton was able to do this although he never quite over came the degree to which he alienated the Left with his forceful positions on NAFTA over Global Warming, and Deficit deals over Health Care or Welfare Reform. He's another example of someone who appeared to fight hardest for those things the Left cared the least about or opposed most strongly. As Clinton's example showed, economic recoveries have a remarkable way of making political problems like disaffected bases go away. But without a recovery, Obama is going to need that base. Karl Rove understood this in 2002 and 2004. Will this White House?

DANA MILBANK - Andrew Romanoff's cynical fratricide

The only thing I don't like about this article are the following:

I've also admired Romanoff's success in Colorado politics, where he was by all accounts a model legislator, a centrist Democrat who built consensus with Republicans on thorny issues such as immigration. But now he has hired Howard Dean's former strategist, Joe Trippi, and he's practicing the Dean style of Democratic fratricide, even as he acknowledges being an "imperfect messenger" for an anti-establishment uprising.

In what way is Democratic fratricide a Dean-style thing? If I recall 2000 correctly, it was a bunch of Democrats at the DLC, namely Al From and his buddy Paul Begala, who went out of their way to slip the knives into Dean's surge in Iowa. And since when is a model legislator "a centrist Democrat who builds consensus with Republicans?" Especially when the issue on which he build consensus is essentially how we can scapegoat immigrants a bit more for the economic problems we face.

George Bush and History | Mother Jones

"There's an odd myth in Republican circles that presidents should act like CEOs, and the way CEOs act is to hire good people and then get out of their way. But nobody who's been a CEO actually believes that. Different managers have different appetites for hands-on management, but no good CEO thinks that she can just hand out some marching orders and then head off to the links for a quick nine holes. Execution matters. But George bought into the myth as thoroughly as any president in history, and he (and we) paid the price for that."


Read more at George Bush and History | Mother Jones

U.S. Senate: Legislation & Records Home > Votes > Roll Call Vote

Dorgan's amendment to ban naked credit default swaps gets tabled by too many Dems and a White House that appears to live on planet Brain-Dead in the galaxy of Insanity when it comes to financial reform. This means Banks get to play, literally gamble, with taxpayer backed funds. Not sure how that makes economic sense...so is it only about the campaign contributions that explain this?

U.S. Senate: Legislation & Records Home > Votes > Roll Call Vote:

Akaka (D-HI)
Alexander (R-TN)
Barrasso (R-WY)
Baucus (D-MT)
Bayh (D-IN)
Bennett (R-UT)
Bingaman (D-NM)
Bond (R-MO)
Brown (R-MA)
Brownback (R-KS)
Burr (R-NC)
Carper (D-DE)
Chambliss (R-GA)
Coburn (R-OK)
Cochran (R-MS)
Collins (R-ME)
Corker (R-TN)
Cornyn (R-TX)
Crapo (R-ID)
DeMint (R-SC)
Dodd (D-CT)
Enzi (R-WY)
Gillibrand (D-NY)
Graham (R-SC)
Grassley (R-IA)
Gregg (R-NH)
Hagan (D-NC)
Hatch (R-UT)
Hutchison (R-TX)
Inhofe (R-OK)
Inouye (D-HI)
Isakson (R-GA)
Johanns (R-NE)
Johnson (D-SD)
Kerry (D-MA)
Kohl (D-WI)
Kyl (R-AZ)
Landrieu (D-LA)
LeMieux (R-FL)
Lieberman (ID-CT)
Lugar (R-IN)
McCain (R-AZ)
McConnell (R-KY)
Mikulski (D-MD)
Murkowski (R-AK)
Nelson (D-NE)
Reed (D-RI)
Risch (R-ID)
Roberts (R-KS)
Sessions (R-AL)
Shelby (R-AL)
Snowe (R-ME)
Stabenow (D-MI)
Thune (R-SD)
Vitter (R-LA)
Warner (D-VA)
Wicker (R-MS)

- Sent using Google Toolbar"

The Nature of the Deficit

There have been numerous stories about the first meeting of the Debt Commission last week.  My of my state's Democratic Congressman recently celebrated that taxes were at their lowest since 1950.  He seems to think that if we just cut defense spending by 15% and freeze discretionary spending, we'll be good to go.  I'd like him to look at the attached charts.

What you'll see is a number of things that you won't hear among the conventional elites in DC as they blather about the deficit and the need to cut entitlements. 

Look at Figure above first - You'll see that we don't have a spending crisis as much as we have a general revenue crisis.  It's great that people are realizing that the budget crisis is most easily managed by tackling the spending in Social Security and Medicare - but note that they're getting the blame for the deficit, which isn't fair.  In fact, the so- called Social Security Crisis that pre-occupied so much of DC's time in the Bush II era has always really been a general revenues crisis.

The next image, SS and Medicare spending as a percent of GDP, shows that Social Security (the blue line) isn't really slated to rise much in terms of spending as a percent of GDP.  What growth you see is probably a function of demographics and an aging population.  But it's hardly indicative of a problem in runaway entitlements' spending.

What you do see in this second attachment is that runaway Medicare spending (the red line) is a problem we have to get a hold of.  We've only just touched the surface of the kinds of things we'll need to do to control Medicare spending in the health care reform bill.  Nothing in the health care debate leads me to think this society and polity are prepared to discuss end of life issues and shaping benefits coverage to match tests of reasonableness for treatments and procedures.  Continually cutting payments to doctors and hospitals for certain procedures will only take us so far.  I'm skeptical that the deficit debate (and the Debt Commission) will ever go there, despite their political insularity.

But most importantly, the top most graphic shows that General Revenues as a percent of GDP have fallen off the cliff.  This is where our real budget problems lie.  Yes, in the last 10 years spending as a % of GDP has risen substantially above historical levels - we have GWB to thank for that.  And much of the last two years growth is directly related to the bailouts and stimulus so they are temporary (see the purple line below).

However our structural problems lie fundamentally on the revenue side.  We've cut taxes repeatedly for the middle class, so that only the highest earners or those without homes and children pay substantial amounts of tax on their income.  The tax base itself is so dependent on the wealthy that it's extremely prone to economic fluctuations.  Much of the deficit would disappear if growth would simply return.  Sadly, what is needed is a broad tax base that can also be fair and progressive.  But the Debt Commission, the President, the Congress and the public seem unwilling to acknowledge or discuss this fact.  Maybe in 10 years Bruce Bartlett thinks.  I think he's optimistic.

There have been three periods of significant declines in general revenues - two times under Bush II and once early in the Reagan years.  There was also a modest decrease in general revenues under Bush I.  But otherwise, general fund revenues rose under most of Reagan's and Clinton's terms - most likely because economic growth was so robust. 

However we don't have a Social Security crisis.  We don't really have an entitlements crisis.  We don't even have a spending crisis once we get past the stimulus spending.  If we had preserved the Clinton era surpluses we'd have some savings to tap for the time (in the next 5-10 years) when entitlement outlays exceed entitlement revenues -- which is what we were supposed to do with the 1986 fix to Social Security - save those funds for the rainy day when our General funds needed to subsidize elderly entitlements.  Yet the heart of the US fiscal crisis - like all historical fiscal crises dating back to the English Revolution that cost King Charles his head - is at heart a revenue crisis.  We simply refuse to raise the general funds to pay for our general funded program appetites.

Why the Democrats Can't Govern

Sigh...

What was is that Will Rogers said? I am not a member of any organized political party. I'm a Democrat.

"George W. Bush came to office having lost the popular vote, with only 50 Republicans in the Senate. After his disputed election, pundits insisted Bush would have to scale back his proposed massive tax cuts for the rich. Instead, Bush managed to enact several rounds of tax cuts that substantially exceeded those in his campaign platform, along with two war resolutions, a Medicare prescription drug benefit designed to maximize profits for the health care industry, energy legislation, education reform, and sundry other items. Whatever the substantive merits of this agenda, its passage represented an impressive feat of political leverage, accomplished through near-total partisan discipline.

"Obama has come into office having won the popular vote by seven percentage points, along with a 79-seat edge in the House, a 17-seat edge in the Senate, and massive public demand for change. But it's already clear he is receiving less, not more, deference from his own party. Democrats have treated Obama with studied diffidence, both in their support for the substance of his agenda and (more importantly) their willingness to support it procedurally."

Cry me a freakin' river

The Daily Dish | By Andrew Sullivan (March 01, 2009) - The View From Your Recession

A reader writes into Andrew Sullivan:

I work for a small, 5-year old non-profit arts organization in Illinois. A couple of our usual big donors have indicated we should be prepared for smaller donations this year, and possibly none in the next couple of years. The are mentioning Obama's tax plans and their need to save money now in anticipation of that. A lot of my colleagues in the not-for-profit world are really scared right now, and we are not happy with Obama. We hear the rhetoric that the government is going to have a reserve to give to non-profits that will make up for some of the lost donations, but the fact is, we have never received federal aid, and likely never would (assuming the organization could even make it that far). Organizations are going to be killed under Obama's plan. I may have voted myself out of a job, and voted a whole community of kids out of art-making opportunities. Frankly, this sucks.

Too bad. I'm sorry you may lose your job. But I'm also sorry millions have already lost their jobs...and their health insurance. If Obama's tax hike on wealthy families causes your non-profit some financial discomfort, it will be because our nation is finally righting an embarrassing wrong from over the last 100 years. While all of our developed competitors and allies offer health insurance to all their citizens, we do not. Obama's tax increase will finally assure health care to all Americans. If a few kids have fewer arts opportunities as a result, you want me to what? Cry for you? DON'T WAIT AROUND TOO LONG.

From the Brothel to the Broadsheet

Eliot Spitzer joins the people at Slate to opine on the issue of CEO pay. And talks some sense. The issue has never been the pay. It's been the collapse of corporate governance and the failure of institutional investors and boards to do their jobs.

G