Category Archives: Reid

Pain Capable Panderers Get The Wedgies

Heller Goo 2

No matter how much he may try to stretch himself into a “moderate” shape Nevada Senator Dean Heller is aligned squarely with the radical right when it comes to women’s health.   The U.S. Senate can’t seem to address major items like climate change, infrastructure, and the voting rights act, but the Republican controlled body can certainly spend time on women’s bodies.  Witness: H.R. 36, and the vote thereon. [rc268]

H.R. 36 is the product of the House conservatives’ brain-flatulence and emphatic embrace of pseudo-scientific items like a “pain capable” fetus, in which abortions would be banned after twenty weeks.  What’s the science?

“Published research generally supports an experience of pain being possible only later in gestation than 20 weeks. A synthesis of available evidence was published in the Journal of the American Medical Association in 2005 by experts from the University of California, San Francisco, and elsewhere, and their report concluded: “Evidence regarding the capacity for fetal pain is limited but indicates that fetal perception of pain is unlikely before the third trimester.” The third trimester begins at 27 to 28 weeks from conception.” [FactCheck]

There are a couple of things to notice in the summary above. First, “evidence regarding the capacity for fetal pain is limited,” or, restated, there is limited evidence (read: little) that the fetus is able to perceive pain. Secondly, if we accept the “limited’ evidence, then the perception is unlikely until 27-28 weeks after conception. However, nothing scientific stopped Senator Dean Heller from voting to bring H.R. 36 up for a vote.  The motion to break cloture failed.

Nevada’s other Senator, Harry Reid, offered the following summation of GOP efforts:

“It is said that you cannot make the same mistake twice. The second time you make it, it’s a choice. On every issue imaginable Republicans are choosing to  employ the same failed strategy. Over and over again, they drag Congress and the American people through votes that are publicity stunts designed to boost their conservative records.

Today we stand in the midst of yet another Republican show-vote designed to honor the political wish list of extremists. Once again, Republicans have decided to place women’s health at the center of their ideological campaign. We’ve seen this tactic before.  It doesn’t work. Americans are tired of Republican attacks on women’s health.”

And yes, the bill is going nowhere, and the vote was a waste of time.  However, it does appear indicative of a Republican strategy in this Constant Campaign season.

Enter The Wedgies

For the sake of argument, let’s define a wedge issue as a social or cultural topic introduced into a campaign which seeks to attract and galvanize persuadable voters who might otherwise focus on economic or other major issues.  There’s nothing particularly new about this technique.  We could start almost anywhere, but 1968 seems as good a place as any, as an election into which two divisive issues were raised: “Public Order,” and “busing.”  The former sought to brand Democrats as the party of chaos (Chicago civil unrest) and the party supporting “forced integration” for which “busing” was the stand-in.  The busing (race) issue morphed into “States Rights”  and “welfare queens” (race) during the 1980 campaign, which was, in turn,  revised into the “Affirmative Action” (race)  issue in 1996. The “gay marriage wedge issue” was used to good effect in the 2004 election season.

Clinging to the Wedgies

While wedge issues are extremely helpful during primary elections, their utility may diminish during general elections depending on the level of voter turnout.  The danger of the wedge strategy is that it may be viewed as what is on offer from a party which has very little else to publicize to a national audience.  The second danger inherent in the wedge strategy is that the issue itself may become marginalized and less effective in national elections.

It’s a useful exercise during any campaign season to take a step away from the publicity attached to single issues or single candidates and see what the polling says about national priorities.  For example, the July 28, 2015 polling done by Quinnipiac University shows registered voters placing the highest priority on the economy and jobs (37%), health care (13%), terrorism (12%), and foreign policy (9%).  Immigration (9%), Climate Change (6%), federal deficit (6%), taxes (3%) rounded out the polling.  Those social and cultural issues garner about 2% to 3% in other polling. [TPP]

Note that of the contemporary wedge issues only immigration is seen as a major national priority (9%) and the polls don’t indicate the perspective of the voters in terms of either passing comprehensive immigration policy reform, or on the other hand, a policy of mass deportation. Gay marriage and abortion barely register with a majority of American voters.

Using gay marriage as a wedge issue appears to be one of those issues whose time has come and gone. Gay marriage might have been a potent wedge issue in 1996 when only 27% of the population thought those marriages should be valid, however its luster faded by 2015 when approximately 60% of the American public agreed that gay marriages should be legal. [Gallup] The fact that only the most radical of the Republican Party’s presidential candidates sought to exploit the issue of the Kentucky county clerk leads to the conclusion that this issue has also been marginalized.

The next available wedge issue for social  conservatives is abortion, and it appears to be moving center stage for its close up in the 2015 primary season.  The priority given to the abortion issue by the GOP has been explained thusly:

“The answer lies in the Republican Party’s shift to the right. A decade ago, between 30 and 40 percent of Republicans identified as pro-choice. This May, (2012) that number was a scant 22 percent. It’s hard to know whether that’s the result of Republicans changing their minds about abortion, or pro-choice respondents ceasing to identify as Republicans. But the result is the same: The party is increasingly uniform in its opposition to abortion.” [AmProsp]

This might help to explain why H.R. 36 (and other similar legislation) is perceived as a cohesive issue for Republicans and why Senator Heller and others have attached themselves to it.  Trends in voter affiliation may support the thesis that some are ceasing to identify as Republicans since polling was done in  2003.  As of 2014 32% responded as Democrats, 39% as Independents, and 23% as Republicans; a loss of 7% in self-identification with the GOP since 2003. [PRC]  If the trend continues, we might reasonably conclude that the fixation in the GOP with what appears to be a wedge issue of limited utility could have serious consequences for that party in upcoming national elections.

Given the Republican Party’s march to the right, the willingness of its national leadership to adopt a wedge issue like abortion, and the continual emphasis placed on the topic by ultra-conservatives, probably means we will see more publicity about Planned Parenthood, more non-scientific legislation, and more lock step votes such as that of Senator Heller in the U.S. Senate.   And it’s still over 400 days until the next national election.

Recommended/Reference: N. Coca, “Wedge Issues: A 2008 Historical Preview,” NithinCoca, January 2008.  D.S. Hillygus, T.G. Shields, “The Persuadable Voter: Wedge Issues in Presidential Campaigns, Princeton University Press, 2009.  K. Walsh, “Wedge Issues Take Center Stage in 2016 Race,” USNWR, April 2015.  Sen. Harry Reid, “Republican Attacks on Women…” Press Release, September 2015.  D. Townshend, “Abortion: The New Wedge Issue,” American Prospect, August 2012.  Pew Research Center, “Trends in Party Affiliation,” April 2015.  The Polling Report, “Problems and Priorities,” July 2015.

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Filed under abortion, Heller, Nevada politics, Politics, Reid

A Well Tuned Whine at the Bundy Ranch

Bundy 2Just what do you say to lawbreakers when they refuse to cooperate with legal decisions?  In Public Lands Council vs. Babbitt the U.S. Supreme Court decided that, yes, the Bureau of Land Management did have the Constitutional authority to enforce the provisions of the Taylor Grazing Act of 1934, 43 USC 315.  What do you say to a freeloading rancher who lost in a Federal District Court in July 2013 (pdf) and again in October 2013 (pdf)?

Nevada’s own freeloading rancher, Cliven Bundy, doesn’t have any “right” to graze his cattle on public land. The land is not his property. He has no deed for the property, it is not for his sole and exclusive use.  [TWN]  There is no “land grab” because the land never belonged to Mr. Bundy in the first place.  How much simpler can the issue be? It is public land, the administration and management of the land is established in 43 USC 315, the law was confirmed as Constitutional by the U.S. Supreme Court on May 15, 2000 in a 9-0 decision from Chief Justice Rehnquist’s court.  [Oyez Project] And, not one but two Federal judges have informed Mr. Bundy he has no case.

It isn’t too difficult to come to the conclusion that Mr. Bundy is all for the U.S. Constitution — until a law he doesn’t personally like is declared Constitutional.  He may be all for law and order — until the law doesn’t suit his purposes.  What do we call the people who violate or ignore laws with impunity?  The answer is commonly “anarchists.”

Senator Dean Heller (R-NV) has another answer. He called them “Patriots.” [Roll Call]   Heller offered yet another example of his “Government as Bully” perspective, “I take more issues with BLM coming in with a paramilitary army of people, individuals with snipers, and I’m talking to people and groups that were there at the event, and to have your own government with sniper lenses on you, it made a lot of people very uncomfortable.”

Let us parse.  What’s a “paramilitary army of people?” On March 15, 2014 after twenty years of trying to get Mr. Bundy to comply with orders,  the Bureau of Land Management informed Mr. Bundy, by letter, that his cattle were “trespassing” and would be impounded.  Mr Bundy’s response — to ask the Clark County Sheriff’s Department for “protection.”  Bundy gives interviews by the hay wagon load and fans the fire of his displeasure. [WaPo]  Members of so-called freedom-fighters gather in Bundy’s support.   Bundy family members confront law enforcement personnel, and one is tazered after he kicks a police dog.

That “paramilitary army” of people were law enforcement personnel, BLM employees, and cowboys hired to round up and impound the cattle.

On the other side, a very visible group of Bundy supporters is the Oath Keepers organization, closely associated with the Tea Party, and infamous for proudly announcing what orders they will not obey. The organization includes members of the 3%’ers and former Arizona sheriff Richard Mack who refused back in the 90’s to enforce the Brady Laws.  [MJ]

Perhaps Senator Heller was ‘inartful’ using the term Paramilitary, but the word usually means an organization the structure, training , culture, and function of which is similar to the military, but is NOT considered a part of a state or federal military branch.  So, who has gathered a “paramilitary army of people?”  From the photographs of the scene the honors appear to go to Mr. Bundy.

But, Senator Heller is disturbed that people have their own government with sniper lens on them. It makes them uncomfortable.  At the risk of flippancy, when is it acceptable to have those who have broken the law for 20 years feel “comfortable?”

The radical right gives every appearance of wanting another drama — another Ruby Ridge, — another Waco, — another armed confrontation with authority, especially federal authority.  Senator Heller’s unfortunate use of the word “Patriot” offers sustenance to the fantasies of the radical right wing which feeds on these scenarios, and revels in the scripted Hollywood versions like Red Dawn.

Senator Harry Reid (D-NV) is more accurate calling antigovernment types like Bundy “domestic terrorists.” [previous post]  Certainly, there are euphemisms which might make the lawbreakers and their allies more “comfortable,” perhaps we could call them “puerile anti-authority activity advocates?”  However, it is not particularly helpful to apply euphemisms to assuage the tender sensitivities of extremists while ignoring the deleterious ramifications of their intentions, and covering their lawlessness with a patina of polite phrases.

The strident whining of the radical right extremists with its cacophony of hypocritical complaints is out of tune with a nation of laws — not of men.

 

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Let Them Eat Pie In The Sky

Pie in the SkySo, the Senate version of a bill to extend unemployment benefits for the long term unemployed will be on the Senate floor on Friday (maybe), if Senate Majority Leader Harry Reid (D-NV) can move through the arcane labyrinth of the Senate Rules. [Roll Call]

The arguments emanating from the GOP side of the aisles would be easier to understand IF anyone from that quarter could explain why it was perfectly acceptable to extend long term unemployment benefits FIVE TIMES during the Bush Administration — but is somehow categorically unacceptable today.

The Incredible Moving Goal Posts

The fact that the Senate Republicans continue to move the goal posts on Senate action serves to remind us why the arguments against the extension are ultimately specious.

The Senate Republicans wanted to add amendments, amendments were allowed, but not enough amendments? Not the right kind of amendments?  The Senate Republicans wanted a Pay For, they got one — on the backs of working people — who would be required to make larger contributions to unemployment insurance programs — that was insufficient, they want MORE… of something.  Whatever. And, whatever is offered by the Democratic leadership we can all bet it will be insufficient to assuage the tender sensitivities of the Ever Outraged GOP.

Right here in the Silver State we have approximately 20,000 individuals who are among the long term unemployed. [LVSun]  They join the estimated 1.3 million [CAP] to  3.8 million now still unemployed or still looking for work in this country. [Guardian]

Let Them Eat Pie In The Sky?

At this point we get to the major question — What’s wrong with extending long term unemployment benefits for people who’ve been out of work for more than 27 weeks?

(1) The incredibly flexible Deficit Argument:

The Republicans won’t vote in favor of extending unemployment insurance benefits because that would increase the federal budget deficit (except the Pay For on offer from the Democrats) unless the Democrats add a provision increasing military retirement cost of living benefits — which would ADD TO THE DEFICIT.  [Roll Call]

Be that bit of illogical thinking what it may, the notion that unemployment benefit insurance payments are swirling into the Black Hole of The Ever Flexible Budget Deficit can’t be sustained when the actual cost to the federal government isn’t increasing. The Congressional Budget Office reported last April:

“Federal spending on unemployment insurance: Annual outlays increased from an average of $33 billion from 2004 through 2007 to $119 billion in 2009 and $155 billion in 2010; they dropped to $93 billion in 2012 and we expect them to decline further over the next few years.”

All you have to do in order to accept the GOP argument that the cost of extending unemployment insurance benefits for 1.3 million long term unemployed people is too much to sustain is simply to ignore the fact that unemployment benefit costs have been declining since 2010.  For those not connected to the Fact Based Universe this should be relatively simple.

(2) Lazy People Argument:  Here they go again!  Somewhere, out there in the Shadow Land of Make Believe there are thousands of lazy shiftless do-nothings who are perfectly happy to be the beneficiaries of public largess — who aren’t members of Congress.  First, this is a Dog Whistle argument, as if receiving unemployment insurance benefits is a form of welfare.  It isn’t, of course, workers have paid into those employment insurance programs.  However, the economic or statutory reality of a program has never stopped the anti-government crowd from splattering the ‘welfare’ label on something, anything, that might remotely help someone.

Secondly, there’s that conception amongst the uninformed that people can make more money not working than by working.  “They” can earn more on ‘welfare,” or “They” can get by not working by simply taking unemployment checks.  The people making these claims have obviously never seriously checked into the eligibility requirements of the Nevada program.

No, in this state, as in most every where else, the Shiftless One cannot refuse employment at a lower rate just because unemployment benefits might be higher — they aren’t and they don’t.   But, we know what the GOP’s thinking?  “They” are those “inner city….. people…..who sit on porch steps….” And, now we’re back at the Dog Whistle.

(3) We’re Just Here To Help You – Have Some Pie From Our Sky.  The problem with pie in the sky is that it is intrinsically  inedible.

In the theoretical world of the Club For Growth and other ultra-conservative outlets, unemployment insurance benefits constitute a drag on employment by being a dis-incentive to work.  Anything which supports a person who is not currently working is automatically classified as a dis-incentive because were the support not available the person would have to work to eat, or something like that.

This also requires the corollary concept that there is work for everyone.  Except that’s not the case, there are now three job seekers for every job opening in the country. [politifact] Thus, the Pie in the Sky model of economic theory falls flat because in the real world of real numbers, two of the job seekers (with or without support) are still going to be looking for work whether there’s an incentive or not.

The second problem with this Pie in the Sky argument is that most people are working, seeking work, or getting discouraged in the process.  Consider, Nevada has an unemployment rate of 8.7%, which means that 91.3% of employment aged people ARE working.  The unemployment rate in the Reno area is 9.1%, meaning that 90.9% are working — [DETR] if the mere existence of unemployment insurance benefits, or any other safety net program,  is such a dis-incentive for working people, why are so many people doing it?

Most of the time the arguments from the ultra-right require the acceptance of a negative view of humanity, a perspective which demands acknowledgment of such furtive claims as “They” are undeserving because “They” are lazy, shiftless, bums who want to watch television and drink beer… without having to specify who “They” might be.  It’s also handy to buy into the well debunked Trickle Down Hoax, in which every tax avoided by a corporate employer, every source of funds left untaxed, and every loophole created in the tax code is magically translated into imaginary jobs.  We tried 30+ years of this and all we got was a Mortgage Meltdown compliments of the Wall Street Casino.

If there are no procedural problems other than those manufactured by the obstructionist GOP leadership in the Senate, and there are not statistical reasons not to extend unemployment insurance benefits for those who have already paid into the systems, and there are no rational economic reasons for not continuing to utilize automatic stabilizers such as the unemployment benefit insurance programs … then why not pass the bill?

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Filed under Economy, employment, Politics, Reid, Republicans, unemployment

A Little Common Sense and Economic Literacy Required

The GOP filibuster of the bill to extend unemployment insurance benefits for “long term” unemployed people was broken by a 60-37 vote in the U.S. Senate [vote 2] with both Nevada Senators voting in favor of the cloture motion.  The bill will now move over to the House side where passage is less certain.

While Senator Heller (R-NV) is anxious for us to know that he’s “still a conservative,” [WaPo Fix] he’s also representing a state with a heavy 3.9% long term unemployment rate.  [BusinessInsider]

How They Voted – States with 3% or higher long term unemployment

Rhode Island  4.1%   Reed (D) Whitehouse (D) Yes

Nevada 3.9% Reid (D) Heller (R) Yes

New Jersey 3.9%  Booker (D) Menendez (D) Yes

Illinois 3.7% Durbin (D) Yes Kirk (R) No

California 3.7% Boxer (D) Feinstein (D) Yes

Mississippi 3.6% Cochran (R) Wicker (R) No

North Carolina 3.6% Hagan (D) Yes Burr (R) No

New York 3.5% Gillibrand (D) Schumer (D) Yes

Georgia 3.5% Chambliss (R) Isakson (R) No

Florida 3.3%  Nelson (D) Yes  Rubio (R) No

Michigan 3.3% Levin (D) Stabenow (D) Yes

Pennsylvania 3.0%  Casey (D) Yes  Toomey (R) No

South Carolina 3.0% Graham (R)  Scott (R) No

These “no” votes make no economic sense.   First, we ought to look at some of the statistics related to unemployment in this country.  The BLS report for November 2013 on characteristics of those unemployed show that of the 10,271,000 unemployed persons in the U.S. 5,400,000 were those who had been laid off or who had finished temporary jobs.   For some 4,448,000 these were not temporary lay offs.  3,329,000 were permanent job losses.  1,160,000 were those who had completed temporary jobs.

Secondly, we should look at where the jobs are increasing.  The last comprehensive report issued in November shows some pockets of economic activity which aren’t promising.  For example, in the health care and services category showed increases in most subcategories, approximately 4,000 nursing home care jobs were lost. [BLS]   While mining and logging showed general growth, support services for mining were down 3.1%.  The manufacturing sector slugged along, with significant employment up for motor vehicles and parts, up 6.7%.  Transportation equipment manufacturing was up 4.9%, and fabricated metal products related employment increased by 3.1%.

In the retail sector of the U.S. economy there was more mixed news.  Employment in electronics and appliance stores down 3.6%, in food an beverage stores down 5.4%, in health and personal care stores down 3.4% in a sector which showed an overall 22.3% increase Oct/Nov 2013.  [BLS]

The mixed news created the chart below, indicating that while employment levels were generally higher, this wasn’t necessarily good news for those who were among the long term unemployed (longer than 26 weeks.)

Duration Unemployment 2013Looking at some of the other labor data could indicate some of the employment sector weakness facing the long term unemployed.  Unemployment rates in the construction sector, while far better than in 2012, were still at 8.6% as of November 2013. [BLS]  The unemployment rate in the leisure and hospitality sector was still above the national average at 9%, and unemployment in the agricultural sector was at 9.7%.

Given a situation in which there hasn’t been enough job creation in significant sectors, and in which while employment has generally improved, there remain pockets of losses, and what we don’t want to create are more “discouraged workers.”

BLS Table A-16 puts paid to the conservative theme that the unemployed are sitting on the stoop swilling beverages of choice and “taking” a living from “hard working Americans.”

Discouraged Workers 2013The number of Americans “marginally attached” to the labor force declined from 2,505,000 in 2012 to 2,096,000 in 2013, meaning that there was a decrease in the number of persons “who want a job, have searched for work during the prior 12 months, and were available to take a job during the reference week, but had not looked for work in the past 4 weeks.”

There was also a decline in the “discouraged worker” category, from 979,000 in 2012 to 762,000 in November 2013.   Discouraged workers  are categorized as “those who did not actively look for work in the prior 4 weeks for reasons such as thinks no work available, could not find work, lacks schooling or training, employer thinks too young or old, and other types of discrimination.”  These people obviously didn’t drop into the infamous “other category” because those numbers also declined.

Others is a category which “Includes those who did not actively look for work in the prior 4 weeks for such reasons as school or family responsibilities, ill health, and transportation problems, as well as a number for whom reason for nonparticipation was not determined.”  Those numbers dropped from 1,526,000 to 1,334,000 between November 2012 and November 2013.   It’s truly hard to argue that people are willing to avoid work when even at a point at which there are three applicants for every single job available those who have only the most tenuous connection to the labor force are demonstrating a reduction in their numbers.

When the numbers of “marginal, discouraged, and ‘other'” workers are dropping people are obviously NOT willing to accept “dependency” on the government for their income.

If we are truly interested in improved economic growth then we’d be well advised to take both some long term and short term measures to develop it.

Short term activities should include extending unemployment insurance benefits so that people have the wherewithal to continue to seek work.  No one is giving away gasoline to get to job fairs and interviews.  Further, (once more will feeling) such benefits act as a automatic stabilizer for the economy, keeping spending levels from gyrating wildly in times of economic instability.  DB’s been on this topic at least since April 2011.

Long term investments in infrastructure rehabilitation and construction would go a long way toward providing employment to meet short term needs in the construction sector and long term necessities for economic activity.

However, there may be little hope that the 233 Republicans in the House of Representatives (112th Congress) will manage to throw off the shackles of ideology.  We know that Trickle Down Economics is a hoax.  We’ve had thirty years of it.  We know that tax cuts don’t “boost the economy;” had this been the case the Bush Administration would have been wildly successful.  We know that deregulation produced one amazing financial sector collapse. And, we can see from the BLS statistics that unemployed people are leeches on the body politic.

However, all this information and experience didn’t prevent 37 Republican members of the U.S. Senate from voting to sustain their filibuster of the bill to extend unemployment insurance benefits to the long term unemployed — including some from the states which could have definitely benefited from the legislation.

Common sense and a modicum of economic literacy are in order.

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Harry’s Gambit

ReidSenate Majority Leader Harry Reid (D-NV):  Floor Statement 11/21/2013 –

In the history of the Republic, there have been 168 filibusters of executive and judicial nominations. Half of them have occurred during the Obama Administration – during the last four and a half years. These nominees deserve at least an up-or-down vote.”

“This gridlock has consequences. Terrible consequences. It is not only bad for President Obama and bad for the United States Senate; it’s bad for our country. It is bad for our national security and for our economic security.”

“Today the important distinction is not between Democrats and Republicans. It is between those who are willing to help break the gridlock in Washington and those who defend the status quo… This change to the rules regarding presidential nominees will apply equally to both parties. When Republicans are in power, these changes will apply to them as well.  That’s simple fairness. And it’s something both sides should be willing to live with to make Washington work again.”  (emphasis added)

The money quote is in the first line.   The motivation comes in the press release wherein Senator Reid states the obvious:

“It is a troubling trend that Republicans are willing to block executive branch nominees even when they have no objection to the qualifications of the nominee. Instead, they block qualified executive branch nominees to circumvent the legislative process. They block qualified executive branch nominees to force wholesale changes to laws. They block qualified executive branch nominees to restructure entire executive branch departments. And they block qualified judicial nominees because they don’t want President Obama to appoint any judges to certain courts.”  (emphasis added)

In short, nominees are being stymied for reasons which are superfluous to the functioning of our courts or to the operation of our executive branch — it’s pure politics.   Reid goes on to explain in a trip down memory lane:

“At the beginning of this Congress, the Republican Leader pledged that, quote, “this Congress should be more bipartisan than the last Congress.” We’re told in scripture that, “When a man makes a vow… he must not break his word.” Numbers 30-2. In January, Republicans promised to work with the majority to process nominations… in a timely manner by unanimous consent, except in extraordinary circumstances.

“Exactly three weeks later, Republicans mounted a first-in-history filibuster of a highly qualified nominee for Secretary of Defense. Despite being a former Republican Senator and a decorated war hero, Defense Secretary Chuck Hagel’s nomination was pending in the Senate for a record 34 days, more than three times the previous average. Remember, our country was at war. Republicans have blocked executive branch nominees like Secretary Hagel not because they object to the qualifications of the nominee, but simply because they seek to undermine the very government in which they were elected to serve.”

And so it began… it didn’t take the Republican minority a full month to renege on their promise to deal with the backlog of civilian nominees.   Now what?

Oh, wail the Washington Chatterati, this action to reduce the filibusters of judicial and executive will come to grief.  The acrimony will increase!  Uh, if it took the GOP only three weeks to back off from their initial promise not to filibuster qualified nominees, the level of acrimony has already hit the top of the scale.  Not to mention the Republican precipitated Government Shutdown which was not exactly an outstanding example of cooperation and good will.

Not sure if the Gridlock assertion is real?  The full list of civilian nominations in committee is located here.  The list of judicial nominations for the district and circuit courts is available here.  It doesn’t take much imagination to look at the lists and conclude that if the Republican minority in the Senate were to filibuster each and every nominee there would continue to be serious backlogs in our courts for the foreseeable future.   Now, consider the “acrimony factor.”

If the present system, allowing the filibuster of every civilian (including judicial) nominee, were to continue in the Senate, and if the Republicans regained the control of the Senate, then it isn’t inconceivable that the Democratic minority would revert to the same tactics as the GOP in the 113th Congress.  Imagine the judicial system if this were to continue through subsequent Congresses?

The only people who would be served by a completely dysfunctional judiciary are those who are already fulminating about the Evil Government taking their unspecified “freedoms,” the modern anarchists.

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Filed under filibuster, Filibusters, Judicial, Politics, Reid

Heller’s Horrors vs. The Constitution

ConstitutionIt seems there are some “Constitutional conservatives” who haven’t perused that august document, and Senator Dean Heller (R-NV) is one of them?  His response to the shutdown of the Federal government? Enact his “No Budget No Pay” bill. [Heller]  Lovely — there’s just one little problem with not paying members of Congress until the houses pass a budget — it violates the 27th Amendment.  “No law, varying the compensation for the services of the Senators and Representatives, shall take effect, until an election of Representatives shall have intervened.”  The Amendment was among the original ideas from the Founders, finally enacted in 1992, and it was intended to prevent members of the House and Senate from jacking up their salaries right before elections.

Then there’s the matter of raising the debt ceiling:

“Without a serious discussion about reducing our debt, I have to agree with then Senator Obama, who called an increase in the debt ceiling a ‘sign of leadership failure’ and a move that shifts the ‘burden of bad choices’ to future generations. Our nation cannot afford to continue raising the limit on our nation’s credit card without making the difficult decisions that prevent the country from incurring even more debt,”said Senator Dean Heller.”  [KRNV]

Oh, here we go again! The Think Of The Children Argument.  News Flash for the Junior Senator — raising the debt ceiling has NOTHING to do with incurring debt.  It has everything to do with paying the debts we’ve already racked up.   Senator Heller appears to believe this debt magically increased during the incumbency of President Obama.

“When President Obama came to office, our nation’s debt was more than $10 trillion. Five years later, our debt is nearly $17 trillion and growing fast. Democrats and Republicans must come together and agree on a long-term solution that places our nation on the path to fiscal solvency. Reducing wasteful spending and reforming the tax code are good places to start. As Senator Obama said in 2006, ‘Americans deserve better,’” said Senator Dean Heller.” [KRNV]

There was no magic involved. There is, however, some magical thinking.   First, when the Obama Administration took over in January 2009 it assumed the costs of the military operations in Iraq and Afghanistan.  Since the costs of these efforts are no longer glossed into “supplemental appropriations,” we’re going to have to look at the $800 billion gorilla in the room — the outright cost of operations in Iraq.   Then there’s the not-so-small matter of paying the veterans’ benefits to those who served in Iraq and Afghanistan. The total expense involved in these military efforts is projected to cost about $4 trillion. [Marketwatch]

Secondly, the United States (including Senator Heller) decided it was a dandy idea to cut taxes in war time — a reversal of what had been previously considered fiscally responsible thinking.  Let’s look at the elements driving the current level of debt one more time:

Source of National Debt

Thus, about 50% of the national debt which concerns Senator Heller so profoundly is a result of military operations in Iraq and Afghanistan and the Bush Era tax cuts (supported by Senator Heller.)  The darker blue segment of the graphic indicates the lost revenues from the Recession created by the collapse of the Housing Bubble.

Senator Heller would prefer not to compare the Bush and the Obama Administrations when it comes to policies which “place our nation on a path to fiscal solvency.”  If he did, he’d be highlighting the following information:

Bush Obama SpendingAnd here we have the answer to the question: Whose new policies created more federal spending? Was it Bush’s $5.07 trillion, or was it Obama’s $1.44 trillion?

As for which side of the aisle was more attentive to future spending levels, the staff of the Washington Post analyzed FY 2014 budget proposals and published the results:

Budgets Compared 2014Whose spending levels were lower over the next decade?

None of these analyses will prevent Senator Heller from continuing to bleat out the same talking points the GOP has been promoting with consistent enthusiasm — The Debt Is Rising! The Debt Is THE Problem!  Equally consistent has been the Republican demand that the social safety net (Social Security, Medicare, SNAP, TANF) be the target for cuts — not the Department of Defense; unless of course we’re speaking of increasing educational, housing, and health benefits for members of our military and veterans.

Now the Republicans threaten to shove the nation over the fiscal cliff, to which Senator Harry Reid (D-NV) responded:

“A vote to avert default is simply a vote to pay the bills. It’s not a vote to spend more money, to authorize new programs or to buy new things and more. It’s a vote to pay the bills the federal government has already incurred – bills for roads and bridges we’ve already built and warships we’ve already commissioned, as well as wars we’ve waged with borrowed money and tax breaks we’ve charged on the national credit card. A vote to avert default is a vote to pay the bills for all those things.”

That pretty much sums it up: (1) Pay the bills… (2) Pay the bills… (3) Pay the bills… as the Constitution says in Amendment 14 section 4.

*For the wonks in the audience, there is an excellent summary of debt ceiling legislation from the Congressional Research Service available in PDF.

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Cliffs, Hostages, and Charts: Passing S. 3412 is good policy

The one element of the current fiscal flap which has attracted most people’s attention is the expiration of the Bush Tax Cuts, and the reversion to the tax rates of the Clinton Administration.  Senate Majority Leader Harry Reid (D-NV) commented today:

“It took four months, but Republicans are finally realizing the way back from the fiscal cliff has been right in front of them all along.  In July, the Senate passed legislation to give economic certainty to 98 percent of families and 97 percent of small businesses – to every American making less than $250,000 a year.  For four months we’ve been one vote away from a solution to this looming crisis.  And for four months, House Republicans have refused to act.  Instead they have held the middle class hostage to protect the richest 2 percent of taxpayers – people who have enjoyed a decade of ballooning income and shrinking tax bills.”(Senator Harry Reid, 11/29/12)

The bill to which Senator Reid is referring is S. 3412, passed in the Senate on July 25, 2012 on a 51-48 vote.   Interestingly, Senator Dean Heller (R-NV) voted against the bill.  The bill has since languished in the Republican controlled House of Representatives.

To restate the obvious, since the end of July 2012 the Congressional Republicans have made it abundantly clear that they will not accept any tax increases on the upper 2% of American income earners.

Every pundit from Bangor to Chula Vista has opined about the various political implications and ramifications of this GOP position.  If we step away from the Chattering Cable-ites momentarily, we can see that tax policy is (1) a rather blunt instrument by which to manipulate economic behavior, and (2) while a reversion to the Clinton area rates is advisable, there really is more that can be done to better secure fiscal stability.

With all due respect to the mathematicians who have crafted all manner of elegant algorithms to predict economic behavior — even if the entire transaction is computerized there is still a very human element involved.  An algorithm is written with a human purpose.  In this case it might be to automate the purchase or sale of particular “things” at a specific price.  The essential problem with capitalism is that prices are determined by human beings who pre-judge the value of the “things” in terms of their own desires and motives.  The motive might fall anywhere along the spectrum from pure speculation to pure long term investment strategies.

Given this context, consider momentarily the currently popular Republican refrain that if marginal tax rates are “too high” investment will be stifled and economic expansion constrained.   The essential economic question at this point is not how many petulant plutocrats does it take to impede any political action in regard to tax rates — but, at what marginal rate does tax information become a significant factor in the investment decision?

As the chart from the IRS indicates, the marginal rate of taxation on the highest income earners has dropped since the mid 1960’s.  The taxation on capital gains is now below 20%.   The next question: What is the statistical relationship between marginal tax rates and investment?

The Congressional Research Service (pdf) studied the relationship between top marginal rates and private savings ratios and created these illustrations of the data:

If the data points look a bit scattered — it’s because they are.  The CRS drew the following conclusion:

“The bottom charts in Figure 3 show the observed relation between the private fixed investment ratio (investment divided by potential GDP) and the top tax rates. The fitted values suggest there is a negative relationship between the investment ratio and top tax rates. But regression analysis does not find the correlations to be statistically significant (see Table A-1 in the appendix) suggesting that the top tax rates do not necessarily have a demonstrably significant relationship with investment.”

Translation: While the charts tend to lead the eyeballs toward seeing a negative relationship, when we actually crunch the numbers the results could just as easily be the result of good old fashioned chance.

There is a place for anecdotal evidence from financialists whose self interest dictates the championing of lower marginal tax rates as a significant factor in their investment decisions, however it’s not in the midst of a rational argument about economics.   Therefore, investor extraordinaire Warren Buffet’s question remains valid:  ‘If I called you in the middle of the night and told you I had the best investment opportunity ever seen in the world — would you ask me about the tax rate?

This ragged relationship between effective rates on capital gains and the returns investors receive as a percentage of GDP is illustrated below:

The first points to note are along the pink line (circa 1996) when the average effect tax rate on capital gains was 25.5% but the trend line for realized gains was going up.  The ‘conventional wisdom’ held for the period between 1996 and 2000, at which point the trend lines no longer support the contention that lower average effective tax rates mean greater realized gains.  Between 2000 and 2004 the average effective tax rates decline, but so do the realized gains, and from 2004 until the last data available from the Tax Policy Center in 2007 the tax rates remain essentially the same but the gains increase.  Go Figure?  What we could conclude with more certainty is that the tax rates and the realized gains aren’t operating in tandem, and there’s more to “economic decisions” than considerations about marginal tax rates on capital gains involved.   Again, Buffett is probably right.

If reducing the effective tax rates on capital gains isn’t a sure fire way to increase earnings and entice yet more investment, then what about tax rates in general?  That doesn’t quite work either as illustrated by the following chart from Business Insider:

… and we know what happened in 2007 through 2008.  If a relationship cannot be demonstrated between lower capital gains taxes and the gains coming from economic growth AND we cannot demonstrate a relationship between overall marginal tax rate reduction and economic growth, WHY are the Republicans so intent on preserving the tax breaks for the top 2% of the nation’s income earners?  George W. Bush may have stated more truth than he meant when he quipped during the 2000 Alfred E. Smith banquet attendees, “This is an impressive crowd. The haves and the have-mores. Some people call you the elite. I call you my base.”

For all of Senator Reid’s efforts to move the Congressional Republicans into the real world of average Americans, nothing has worked thus far to convince them to abandon frivolous pledges from scions of anti-tax activists, which at this point serve little purpose other than to widen the income gap, and to deplete the capacity of middle income earners to generate the aggregate demand necessary to stimulate the economy.

It really can’t be argued that all economic decisions are dictated by human behavior, but neither can it be successfully asserted that an economy is not essentially a very human institution.   There are reasons well beyond the political optics of S. 3412 for Republicans to give serious consideration to pass the bill in the House of Representatives; it’s good economic policy.

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Filed under Economy, Heller, Reid, Taxation