Monthly Archives: February 2009

Should We Celebrate or Mourn?

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If the stimulus bill in its current form is the bill that becomes law, is this a victory or a defeat for progressivism? Or something in between?

Arguing for “defeat” is Paul Krugman —

What do you call someone who eliminates hundreds of thousands of American jobs, deprives millions of adequate health care and nutrition, undermines schools, but offers a $15,000 bonus to affluent people who flip their houses?

A proud centrist. For that is what the senators who ended up calling the tune on the stimulus bill just accomplished.

Professor Krugman explains why the stuff the mushy moderates cut out of the bill were the most economically stimulating parts, while much of what they left in will provide little stimulus. He is put out with President Obama for compromising away too much in the name of “bipartisanship.”

Republicans also believe they have defeated progressivism, and so they are celebrating. Alec MacGillis and Perry Bacon Jr. write in the Washington Post ,

Rep. Pete Sessions (R-Tex.) suggested last week that the party is learning from the disruptive tactics of the Taliban, and the GOP these days does have the bravado of an insurgent band that has pulled together after a big defeat to carry off a quick, if not particularly damaging, raid on the powers that be. …

…The fact that the stimulus legislation keeps moving forward nonetheless has done nothing to dim Republicans’ satisfaction. Rather, they sense a tactical victory, particularly in the framing of their opposition to the plan as a clash with congressional Democrats instead of with President Obama, who remains far more popular with voters than does Congress.

Republicans are holding congressional Democrats responsible for the wasteful spending they say is in the stimulus package, even though most of the big-ticket items — for renewable energy, health care and schools — are ones that Obama wanted in the package to advance his long-term goals.

President Obama seems to have picked up on this and is moving to take more ownership of the bill. E.J. Dionne writes at WaPo,

By evening, when the president spoke to Democratic House members in Williamsburg, he had cast aside his efforts to placate Republicans who had no intention of reasoning with him on the stimulus bill. Obama had turned the other cheek often enough.

“Don’t come to the table with the same tired arguments and worn ideas that helped to create this crisis,” the born-again campaigner thundered. “We are not going to get relief by turning back to the very same policies that, for the last eight years, doubled the national debt and threw our economy into a tailspin.”

Deploying a preacher’s unapologetically judgmental cadences, Obama denounced “the losing formula that says only tax cuts will work for every problem we face.” He reiterated that argument in his Saturday radio address and will press it in speeches on the road this week.

Gallup reports that Obama is way ahead of congressional Republicans in approval polls.

At The Guardian, Michael Tomasky argues that liberals are worryworts and should be celebrating.

Think back. Two months ago, people were talking nervously about a stimulus package worth about $400bn. Now? Assuming the Senate and House of Representatives more or less split the difference between their two versions of the bill – they will likely iron those out this week and vote on the final passage of the new product by the week’s end – we’re talking twice that, with at least $500bn in new spending (the rest is tax cuts). That is, by some distance, the largest public spending bill ever conceived in the US.

Republicans are in disarray. First, this approach goes against everything they believe. Second, they are suddenly losing an argument that they thought they were winning. To hear cable television tell the story last week, they had Obama on the ropes. Support for the package was allegedly sinking like a stone in the country. Then he goes out and gives a grand total of one speech, not even one of his better ones, and bam, suddenly they’re losing. They must be absolutely irate – and privately very, very nervous about the future.

Futher, he says, this bill isn’t the only program in the works to stimulate the economy.

Treasury secretary Tim Geithner is rolling out a plan today to get credit flowing and protect homeowners. Soon, the administration will present a proper budget, in which it can signal priorities about things like transport and the greening of the economy, which are multi-year projects in the best of circumstances.

There’s also the view that a flawed stimulus is better than no stimulus.

Moderate Mush

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In one of its trademark mushily oblivious editorials, the Washington Post today praises the “moderates” who worked out a Senate compromise stimulus bill. However, other people drew editorial scorn.

The effort wasn’t helped by those senators, including the leadership on both sides of the aisle, who wallowed in customary blame-gamesmanship. On Thursday, Senate Majority Leader Harry M. Reid (D-Nev.) accused the moderates of trying to hold the president hostage. Senate Minority Leader Mitch McConnell (R-Ky.) derided the impending bill as an “aimless spending spree that masquerades as a stimulus.” Sens. Lindsey O. Graham (R-S.C.) and Barbara Boxer (D-Calif.) went theatrical. He held up a copy of an earlier version of the Senate stimulus plan to slam the process that led to its creation. She brandished her own copy to complain that Mr. Graham never resorted to such antics when they considered President Bush’s bailout bill for Wall Street. Friday House Speaker Nancy Pelosi (D-Calif.) jumped in, deriding the quest for bipartisanship as a “process argument” and claiming that potential cuts in the Senate bill “will do violence to the future.”

What the mushheads at WaPo fail to understand is that Pelosi is right. Their ideas of “bipartisanship” call for process over substance, and the cuts in the Senate bill will prolong the misery of many Americans.

As Ian Welsh explains, the “moderates” have cut 1-1/4 million jobs from the stimulus bill (or just under a million, depending on what the actual cut turns out to be). To WaPo, 1-1/4 million jobs are not important. What’s important is that Senators speak politely and not rattle the teacups or slosh the cream.

Anyone up for storming the Bastille today?

Ian does the math. Paul Krugman also explains,

I’m still working on the numbers, but I’ve gotten a fair number of requests for comment on the Senate version of the stimulus.

The short answer: to appease the centrists, a plan that was already too small and too focused on ineffective tax cuts has been made significantly smaller, and even more focused on tax cuts.

According to the CBO’s estimates, we’re facing an output shortfall of almost 14% of GDP over the next two years, or around $2 trillion. Others, such as Goldman Sachs, are even more pessimistic. So the original $800 billion plan was too small, especially because a substantial share consisted of tax cuts that probably would have added little to demand. The plan should have been at least 50% larger.

Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

As Matt Yglesias puts it, “the cart of bipartisanship is straightforwardly put ahead of the horse of policy merits.”

Brad DeLong:

The stimulus package is too small–and it looks like almost all of the cuts are from reasonable uses of government funds that are substantially labor intensive and thus are the right kind of thing to be in the stimulus package.

Now, I tend to believe that process is important. But what the moderates are doing is ignorant. They aren’t looking objectively at the cost effectiveness of the various components of the package. They’re just cutting stuff out that it feels good to them to cut out. And yes, I think most Republicans want the thing to fail, and they’re ensuring that it does.

WaPo — deliberately undermining what the other party is trying to do is not “bipartisanship.

I understand President Obama will address the nation tomorrow. I hope he has the guts to explain to the American people that the compromised bill will be less effective than the one he wanted. I hope he doesn’t just praise the Senate for screwing up America’s future.

Stimulus Bill: Come to Jesus

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Mcjoan says “Maybe it’s time for Obama to have a come to Jesus meeting with a few members of the Dem caucus, Ben Nelson being at the top of that list.” I endorse that.

I also think Congress and the Washington press corps should listen to Nancy Pelosi:

Pelosi — speaking to reporters on the second day of her retreat with House Democrats at a swank Williamsburg, Va., golf resort — was clearly annoyed with Senate attempts to slash up to $100 billion in spending from the $819 billion package the House passed last week.

At the same time, she urged the need for speed in passing the package — and stopped short of saying that she’d insist on her demands during upcoming conference negotiations with the Senate.

“Washington seems consumed in the process argument of bipartisanship, when the rest of the country says they need this bill,” the California Democrat said, seeming to sweep aside the Obama administration initial desire to have broad GOP support for the plan.

The Obama Administration’s desire is to get the damn bill passed asap, and if it can be done with no Republican votes at all, then so be it. Unfortunately, the Senate will require some Republican votes to pass.

Brad Dayspring, a spokesman for House Minority Whip Eric Cantor (R-Va.), said: “Her comment really makes one wonder whether she understands the concerns of not only the majority of struggling Americans seeking tax relief and job creation, but many members from her own party.”

Are the majority of struggling Americans seeking “tax relief” right now? I don’t think so. “Tax relief” actually is pretty far down the list, except for right-wingers, who need to learn they are a bleeping minority.

There’s much clucking in media about how Pelosi and other Dems are being “partisan” for not standing around smiling and passive while the minority party ensures that the American economy remains bleeped up long enough for Republicans to take some seats back in 2010. Again, the beltway crowd sill seems to think that “bipartisan” means allowing the GOP to have the last word, even after they’ve lost an election.

We are reminded that John McCain is brain dead:

Day after day, McCain has been on the Senate floor criticizing Obama’s package with the core Republican message. “This bill has become nothing more than a massive spending bill,” he has said. “To portray it as stimulus flies in the face of reality.” He has called the legislation an “unnecessary, wasteful bill.”

I saw a clip of that on television last night, and it left me babbling at the walls. Dear Senator Idiot: Do you not understand that “spending” is the bleeping point of the bill? Do you not understand that the crisis requires getting more money into circulation as fast as possible, and only the government can do that? Do you have any brain at all?

I swear, if John McCain had popped out of the wall I think I would have thrown a lamp at him.

Anyway, it looks as if the Senate has agreed on a watered-down version of the stimulus bill. I think Congress should pass whatever it can pass as quickly as possible, but when Obama finally signs it into law I want him to go on television and explain to the American people that the bill as passed was watered down by Republicans and will be less effective than the bill he wanted. Credit where credit is due.

One of These Days

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First off, I have a post up on Buddhist economics at the other site.

Second, see Ali Frick, “As Economy Sheds 600,000 Jobs In One Month, Senate Conservatives Ask: What’s The Rush?”

I would like to explain to Congress that people are getting genuinely panicky out here. Panicky as in the last lifeboat is gone and we’re still on the deck of the Titanic. See also Paul Krugman.

And as the boat begins to break apart, what are the Republicans doing? Playing games. As Steve Benen says, “The opposition party, when it’s not blatantly lying about the recovery plan, is offering ideas that are a) nonsensical; b) dangerous; or c) nonsensical and dangerous.”

In right-wing rhetoric, all public spending is pork. Here’s a list of the “pork” about to be cut from the stimulus bill.

Head Start, Education for the Disadvantaged, School improvement, Child Nutrition, Firefighters, Transportation Security Administration, Coast Guard, Prisons, COPS Hiring, Violence Against Women, NASA, NSF, Western Area Power Administration, CDC, Food Stamps

It really is time for torches and pitchforks, people.

White House Tails

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Michael Shear writes for the Washington Post reports that raccoons have invaded the White House grounds.

The National Park Service is in pursuit of one very large raccoon and several medium-sized raccoons, who have been spotted roaming the grounds around the Executive Mansion and the West Wing, a spokesman said.

“The idea of raccoons on the White House grounds give us great pause,” spokesman Bill Burton said.

Was that pause or paws?

The National Park Service has put out live traps, but to no avail. Local critter trapper Tim McDowell says the NPS probably is using the wrong cages, or cages that don’t smell right. McDowell has offered to catch the raccoons for free.

McDowell has already removed birds that were flying inside the U.S. Capitol, but he says that he’s always dreamed of catching a raccoon on the White House grounds.

An unusual ambition, but to each his own.

According to legend, President Calvin Coolidge had several “unusual pets” including two raccoons, a bobcat and a donkey.

They were Grace’s pets, I think. At least the raccoons were.

The Battle Is Joined

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We knew it wouldn’t be easy. We knew President Obama would make mistakes. Let’s make a quick assessment of where we are now.

First, you may have seen headlines that the popularity of the stimulus bill has tanked. Nate Silver says this is not so. It may have slipped a little in popularity, but a majority of the public still supports it.

Second, E.J. Dionne writes that President Obama is not fighting back hard enough against the hysterical and mostly frivolous and misleading charges being made by Republicans against the stimulus bill. I agree with this. Yes, the Daschle debacle threw the President off his game, but that was yesterday’s news. Now he has to start punching.

And lo, Peter Nicholas writes for the Los Angeles Times,

President Obama abruptly changed tactics Wednesday in his bid to revive the economy, setting aside his bipartisan stance and pointedly blaming Republicans for demanding what he cast as discredited “piecemeal measures.”

Obama’s comments were a marked departure from the conciliatory tone he has maintained as he courted Republican votes for his stimulus package through compromise. Against the wishes of his own party, Obama crafted a plan that relied heavily on tax cuts rooted in Republican economic doctrine.

As part of this counter-offensive, President Obama has written an op ed for today’s Washington Post.

In recent days, there have been misguided criticisms of this plan that echo the failed theories that helped lead us into this crisis — the notion that tax cuts alone will solve all our problems; that we can meet our enormous tests with half-steps and piecemeal measures; that we can ignore fundamental challenges such as energy independence and the high cost of health care and still expect our economy and our country to thrive.

I reject these theories, and so did the American people when they went to the polls in November and voted resoundingly for change. They know that we have tried it those ways for too long. And because we have, our health-care costs still rise faster than inflation. Our dependence on foreign oil still threatens our economy and our security. Our children still study in schools that put them at a disadvantage. We’ve seen the tragic consequences when our bridges crumble and our levees fail.

Every day, our economy gets sicker — and the time for a remedy that puts Americans back to work, jump-starts our economy and invests in lasting growth is now.

That’s good, but that message needs to be read to everyone in America.

Meanwhile, the executive cap idea is getting legs and endorsements by most people outside of Wall Street. I think this could be a very popular measure that Republicans oppose at their peril. The Los Angeles Times argues that it would help restore public confidence in the economy.

Finally, as Republicans still are tripping all over themselves to placate El Rushbo, Max Blumenthal says Limbaugh is one of the least liked people in America.

An October 24, 2008, poll conducted by the Democratic research firm Greenberg-Quinlan-Rosner has Rush Limbaugh enjoying a public-approval rating of just 21 percent among likely voters, while 58 percent have “cold” feelings toward the right-wing radio-talk-show host. Limbaugh was the least popular of the all the political figures the firm polled. He polls seven points lower than Rev. Jeremiah “God Damn America” Wright and eight points below former Weather Underground domestic terrorist William Ayers.

If the Democrats were smarter than I believe they are (alas), they’d be working overtime to make Rush a block of cement around the GOP’s feet.

Caps and Cans

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Edmund Andrews and Vikas Bajaj write for the New York Times that

The Obama administration is expected to impose a cap of $500,000 for top executives at companies that receive large amounts of bailout money. … Executives would also be prohibited from receiving any bonuses above their base pay, except for normal stock dividends.

The CEOs of the financial industry brought this on themselves because they proved they can’t be trusted with money. We saw from the first wave of no-strings-or-oversight-attached bailouts from the Bush Administration that they can’t be trusted with money. You might as well give the bailout money to crack addicts.

Although CEOs cannot directly write their own checks, as I understand it their compensation is determined by the Board of Directors, an insulated group of people living in the same bubble of privilege as the executives. Apparently, boards of directors of financial institutions cannot be trusted with money, either.

Those who are still insulated are whining that a $500,000 cap is “draconian.” Steve Benen writes,

What a fascinating perspective. There are a series of companies that have been managed poorly and are on the verge of collapse. They’re going to the federal government, hat in hand, hoping to get tax dollars to keep them afloat. As James F. Reda sees it, a $500,000 salary is “draconian,” and might lead frustrated executives — accustomed to exorbitant salaries disconnected to job performance — to leave the companies they helped drive into the ground. Companies that would no longer exist were it not for government intervention.

And this is a problem, because … ?

I agree with Steve that there must be some sharp people in the ranks of financial industry management who would be happy to take $500,000 a year. As for those executives who would be insulted and quit — good luck finding work elsewhere, bub.

The bad news is that it seems the stimulus bill is falling short of votes in the Senate. See the Talking Dog for background.

Gary Kamiya reminds us what’s at stake:

We are in a dreadful economic crisis, the worst in the lifetime of anyone who is under 70 years old. Forget the abstract statistic that millions of people are out of work and try to grasp this staggering reality: Twenty thousand jobs a day are being lost. Millions of people have lost their homes and their life savings. Countless millions have no health insurance. Businesses are failing at a staggering rate. Desperate states are shutting down services.

This is not a drill. These are real things that are happening to real people, people we all know. Everyone, whether they’re poor, working-class or middle-class, has either suffered themselves from the economic collapse or knows someone who has.

Try explaining that to the Senate. Thanks.

Daschle Withdraws

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Various news sources say Tom Daschle has withdrawn his nomination to be Secretary of Health and Human Services and director of the White House Office of Health Reform. His tax problems were wearing him down. Ezra Klein has a reaction — good for government ethics, bad for health care reform.

It doesn’t seem to be possible to be elected to or involved in government in Washington on any level without becoming compromised. Makes me want to smack heads sometimes.

If you’re interested, I have a post on the other blog that sorta kinda relates — Life in the God Realms.