Once one realizes that most of the Tea Party members of Congress really believe that government is a parasitic organization that sucks the life out of our society, rather than how society determines and implements national policy for itself, then one must conclude that they will try to force a default. They have faith that the rest of the Congress will cave into their demands.
The Tea Party lives in an intellectual bubble where the answers to every problem lie in books by Ayn Rand and Glenn Beck. Rand’s anti-government writings, regarded by her followers as modern-day scripture – Rand, an atheist, would have bristled at that comparison – are particularly instructive. When the hero of Rand’s breakthrough novel, “The Fountainhead,” does not get what he wants, he blows up a building. Rand’s followers see that as gallant. So perhaps it should not surprise us that blowing up the government is no big deal to some of the radical narcissistic individualists in our House of Representatives. Republicans need to decide whether they want to be responsible conservatives or whether they will let the Tea Party destroy the House That Lincoln Built in a glorious explosion. Such pyrotechnics may look great to some people on the pages of a novel or in a movie, but they are rather unpleasant when experienced in real life.
The Tea Party’s followers are endangering our nation’s credit rating. They are also endangering the Republican Party by pushing both House Speaker John Boehner and Majority Leader Eric Cantor away from compromising with the Democrats to solve this problem. Cantor worked amicably with the negotiating group organized by Vice President Joe Biden and won praise for his focus even from liberal staffers who have no use for his politics. Yet when the Biden group seemed close to a deal, it was shot down by the Tea Party’s champions – and Cantor walked out since he serves as a spokesman for the Tea Party.
Twice now, when Boehner came near a bigger budget deal with President Obama, the same extreme right-wing rejectionists blew this up, too – or maybe Boehner always planned to walk out when the time was right (after the close of the markets). Boehner and Cantor owe their House majority in part to Tea Party supporters so they are in a box and pretty much must do what they are told to do by the Tea Party freshmen in the House. Neither of the two House leaders seems in a position to tell the obnoxious Tea Party that it is flatly and dangerously wrong when it claims that default is of little consequence. Rarely has a congressional leadership been so powerless.
The evidence suggests that both Boehner and Cantor understand the risks of the game their Republican colleagues are playing; and they know we are closer than we think to the credit rating of the United States being downgraded. This may actually happen before August 2, which is the date everyone is using as the deadline.
It is not much better in the Senate. Compare the impasse Boehner and Cantor are in with the aggressive maneuvering of Senate Republican Leader Mitch McConnell. He knows how damaging default would be and has been working with Senate Majority Leader Harry Reid to figure a way out – although I understand this deal is dead in the water in the House. McConnell can do this because he does not have a Tea Party problem in the Senate that so bedevils Boehner and Cantor. Many of the Tea Party’s Senate candidates – Sharron Angle in Nevada, Christine O’Donnell in Delaware and Joe Miller in Alaska – lost in 2010.
Capitol Hill looks like a lunatic asylum to many of our own citizens and much of the world as the Ayn Rand Cult runs amok in Congress. Quite simply, it appears that the Tea Party’s legions are not interested in governing – at least not as governing is normally understood in a democracy with separated powers. They believe that because the Republicans won one house of Congress in one election, they have a mandate to force upon this the nation whatever the right wing wants. The Democratic president and Senate are dismissed as irrelevant nuisances, even though they, too, were elected.
Our country is on the edge of an economic abyss. We need to act now to restore certainty to the markets and the economy by extending the debt ceiling through the end of this Congress – past January 2013. Republicans are going to have to cut loose from the Tea Party and get with the Democrats to increase the debt ceiling.
I hope it will not be too difficult for Americans to figure out who is truly to blame if this country defaults (the 'no new revenue', 'my way or the highway', 'we will never compromise' Party of No). If we truly default, I pray that this will be the beginning of bringing back the moderate wing of Republican Party in America. It may have to fracture into an ultra-right party and a center/fiscally cautious party which will bring many Independents and right-leaning Dems with it. Of course, the price for this welcome political development would be a 15% unemployment rate, higher inflation, and higher 30-year mortgages. But clearly, the Tea Party does not seem to care, or understand how government is all about compromise. I would love to see every one of the Teabaggers become a pariah.
And I wish the entire country will learn that this extremely dysfunctional gridlock is what happens when you elect members of the Ayn Rand Cult to Congress – but it won't.
Hopefully, we will be witnessing the demise of Tea Party in the next election. But I will not be holding my breath because the more I watch the political process, the more I realize how malleable the electorate is – especially those on the right. I have become concerned that we may be seeing a huge shift to the right that will last a decade until the 20-somethings who helped to vote Obama into office become more involved.
Sunday, July 24, 2011
Tuesday, July 19, 2011
When you lie down with dogs
The once Grand Old Party is in trouble – as in Tea Party trouble – and it could soon get worse because of three factors:
1) A government default: House Republicans may be in the process of overreaching. Rank-and-file members, many of them elected with Tea Party support last year, seem intent on using the August 2 expiration of the debt ceiling to draw a line in the sand. If the Democrats do not agree to huge cuts without an increase in revenue (my way or the highway), they will refuse to pay our country’s debts. Many Tea Partiers say that there will be little effect on the economy – but they are misinformed. Almost $5 trillion is held by U.S. banks, U.S. pension funds, and individuals like me (such as savings bonds and Treasuries). About that same amount is held by other branches of the U.S. government itself. Only about 1/3 of U.S. debt is held by foreign countries, which includes China’s less than $1 trillion. So, who will get hurt the most if the government defaults? Americans will.
Evidently Speaker Boehner may have no choice but to go along with these ignorant Tea Partiers, since championing a compromise with the White House will inevitably prompt cries of "Treason!" These ‘true believers’ in the GOP conference could easily depose Boehner in favor of Eric Cantor, the Tea Party leader who is known to covet Boehner's post. Thus, for fear of losing his job, the potential exists for Boehner to lead the House GOP into a default on our country’s “full faith and credit” worthiness.
2) The far-right governors: This has been a surprising source of damage to the GOP brand. Newly elected Republican governors in Wisconsin (Scott Walker), Ohio (John Kasich) and Florida (Rick Scott) have all chosen to address their states' budget issues with devout, literal adherence to the Tea Party playbook. In terms of polling, the results have been catastrophic. A poll this week put Scott's approval rating at under 30 percent – and Walker and Kasich are only a few points better in their states.
Their struggles have the potential to spread across state lines. Walker's protracted fight over collective bargaining rights has been one of the biggest national stories of the past few months. Voters in and out of Wisconsin are siding with Democrats and against the Republican governor. For the national GOP, the danger is that voters across the country are seeing Walker, Kasich, and Scott not as individual state governors waging provincial fights but as how the Tea Party governs in America.
Governors Walker and Scott both won their gubernatorial primaries last year with considerable Tea Party support. Scott, in fact, overcame a fierce effort from the party establishment to deny him the nomination. Without the Tea Party, the national Republican brand would probably not now be burdened with the public relation problems that these governors have caused.
3) The Tea Party itself: The movement – which is really just a synonym for the Republican Party base – was a source of strength for the GOP last year in that it helped to inspire and activate previously dejected Republicans after the 2008 presidential election. It was also a liability because Tea Party activists propelled utterly unelectable candidates to GOP nominations for several important Senate and gubernatorial contests. On March 31 about 100 of its members gathered in Washington for a rally regardless of the fact that the Tea Party has become a clear liability for the GOP. In the past 12 months, the number of Americans expressing a negative view of the Tea Party movement has increased by 21 points. A CNN/Opinion Research poll found that the Tea Party is now viewed unfavorably by half of Americans. This can partly be chalked up to the negative press the movement has received thanks to the often crazy and extreme antics of its supporters.
You can argue that all three of the above threats to the GOP label should be condensed under the Tea Party label. After all, if a shutdown does happen, it will be because Boehner was unable or unwilling to cut a deal thanks to pressure from House Republicans who were elected last year with Tea Party support or who fear the Tea Party's wrath (or both).
The Republicans made their bed – now they must lie in it.
When you lie down with dogs, you get up with fleas. In fact, the entire country may end up with fleas due to these Tea Party dogs.
1) A government default: House Republicans may be in the process of overreaching. Rank-and-file members, many of them elected with Tea Party support last year, seem intent on using the August 2 expiration of the debt ceiling to draw a line in the sand. If the Democrats do not agree to huge cuts without an increase in revenue (my way or the highway), they will refuse to pay our country’s debts. Many Tea Partiers say that there will be little effect on the economy – but they are misinformed. Almost $5 trillion is held by U.S. banks, U.S. pension funds, and individuals like me (such as savings bonds and Treasuries). About that same amount is held by other branches of the U.S. government itself. Only about 1/3 of U.S. debt is held by foreign countries, which includes China’s less than $1 trillion. So, who will get hurt the most if the government defaults? Americans will.
Evidently Speaker Boehner may have no choice but to go along with these ignorant Tea Partiers, since championing a compromise with the White House will inevitably prompt cries of "Treason!" These ‘true believers’ in the GOP conference could easily depose Boehner in favor of Eric Cantor, the Tea Party leader who is known to covet Boehner's post. Thus, for fear of losing his job, the potential exists for Boehner to lead the House GOP into a default on our country’s “full faith and credit” worthiness.
2) The far-right governors: This has been a surprising source of damage to the GOP brand. Newly elected Republican governors in Wisconsin (Scott Walker), Ohio (John Kasich) and Florida (Rick Scott) have all chosen to address their states' budget issues with devout, literal adherence to the Tea Party playbook. In terms of polling, the results have been catastrophic. A poll this week put Scott's approval rating at under 30 percent – and Walker and Kasich are only a few points better in their states.
Their struggles have the potential to spread across state lines. Walker's protracted fight over collective bargaining rights has been one of the biggest national stories of the past few months. Voters in and out of Wisconsin are siding with Democrats and against the Republican governor. For the national GOP, the danger is that voters across the country are seeing Walker, Kasich, and Scott not as individual state governors waging provincial fights but as how the Tea Party governs in America.
Governors Walker and Scott both won their gubernatorial primaries last year with considerable Tea Party support. Scott, in fact, overcame a fierce effort from the party establishment to deny him the nomination. Without the Tea Party, the national Republican brand would probably not now be burdened with the public relation problems that these governors have caused.
3) The Tea Party itself: The movement – which is really just a synonym for the Republican Party base – was a source of strength for the GOP last year in that it helped to inspire and activate previously dejected Republicans after the 2008 presidential election. It was also a liability because Tea Party activists propelled utterly unelectable candidates to GOP nominations for several important Senate and gubernatorial contests. On March 31 about 100 of its members gathered in Washington for a rally regardless of the fact that the Tea Party has become a clear liability for the GOP. In the past 12 months, the number of Americans expressing a negative view of the Tea Party movement has increased by 21 points. A CNN/Opinion Research poll found that the Tea Party is now viewed unfavorably by half of Americans. This can partly be chalked up to the negative press the movement has received thanks to the often crazy and extreme antics of its supporters.
You can argue that all three of the above threats to the GOP label should be condensed under the Tea Party label. After all, if a shutdown does happen, it will be because Boehner was unable or unwilling to cut a deal thanks to pressure from House Republicans who were elected last year with Tea Party support or who fear the Tea Party's wrath (or both).
The Republicans made their bed – now they must lie in it.
When you lie down with dogs, you get up with fleas. In fact, the entire country may end up with fleas due to these Tea Party dogs.
Saturday, July 9, 2011
AAARRRGGGGG!
The lessons of the 2008 financial crisis have been forgotten! The policies that got us into the crisis (deregulation, tax cuts) and the idea that what’s good for the bankers is good for America have once again taken hold. Trickle-down economics, the idea that anything that increases corporate profits is good for the economy, is making a comeback.
This is NUTS! Schizophrenic!
Over the last two years profits have soared while unemployment has remained disastrously high. The corporations have not used their increasing profits to hire more people. Why would anyone believe that handing even more money to corporations in the form of bigger tax cuts with no strings attached would lead to faster job creation?
Trickle-down “economics” is clearly rising again – and even some very stupid Democrats are buying into it. Look at the arguments Republicans are using to defend outrageous tax loopholes. How can people simultaneously demand savage cuts in Medicare and Medicaid and defend special tax breaks favoring hedge fund managers and owners of corporate jets?
A spokesman for Eric Cantor, the House majority leader, told Greg Sargent of The Washington Post: “You can’t help the wage earner by taxing the wage payer offering a job.” He went on to falsely say that the tax breaks at issue mainly help small businesses (they are actually for big corporations). But the basic argument was that anything that leaves more money in the hands of corporations will mean more jobs.
Okay, you dummies, if you believe that, I have a bridge in Brooklyn I can sell you – or how about some forestland in Arizona! It has only been slightly burned!
What about all those trillions in profits from overseas subsidiaries that U.S. corporations are supposed to pay taxes on? They are supposed to pay taxes when those profits are transferred back to the U.S. But these corporations want to bring all that money home to give to the CEOs and the shareholders without paying any taxes. So, now there’s a move afoot by their Republican friends in Congress to offer an “amnesty” under which companies could move funds back home while paying hardly any taxes. And there are some very stupid Democrats supporting this idea, claiming that it would create jobs.
NO, IT WON’T! We have been here before!
A similar tax holiday was offered in 2004, with a similar sales pitch. It was a total failure! Companies took advantage of the amnesty to move a lot of money back to the United States. But they used that money to pay dividends, pay down debt, buy up other companies, and buy back their own stock – everything except creating jobs. There is no evidence that the 2004 tax holiday did anything at all to stimulate the economy. What the tax holiday did do, however, was give big corporations a chance to avoid paying taxes. They would eventually have brought the money home anyway, and paid taxes on it. In return for all the untaxed money, these companies moved even more jobs overseas. Now they now they are pushing their Republican friends to once again let them bring overseas profits home nearly tax-free.
How can anyone imagine that lack of corporate cash is what’s holding back recovery in America right now? After all, it’s widely understood that corporations are already sitting on large amounts of cash that they are NOT using to grow their businesses here at home and hire more Americans. In fact, that idle cash has become a major conservative talking point, with right-wingers claiming that businesses are failing to invest because of political uncertainty.
That is false!
The evidence strongly says that the real reason businesses are sitting on cash is lack of consumer demand. Americans are only buying necessities and growing their savings. If corporations already have plenty of cash they are not using, why would giving them another tax break that would increase their piles of cash do anything to help the recovery?
Lack of corporate cash is not the problem facing America. Big business already has the money it needs to expand; what it lacks is a reason to expand with consumers still on the ropes and the government slashing spending. Claims that a corporate tax holiday would create jobs, or that ending the tax break for corporate jets would destroy jobs, are nonsense.
What our economy needs is direct job creation by the government and mortgage-debt relief for stressed consumers.
What America does not need is a transfer of billions of dollars to corporations that have no intention of hiring anyone except more lobbyists.
AAARRRGGGG!
Edited version of: Corporate Cash Con, By Paul Krugman. NY Times
This is NUTS! Schizophrenic!
Over the last two years profits have soared while unemployment has remained disastrously high. The corporations have not used their increasing profits to hire more people. Why would anyone believe that handing even more money to corporations in the form of bigger tax cuts with no strings attached would lead to faster job creation?
Trickle-down “economics” is clearly rising again – and even some very stupid Democrats are buying into it. Look at the arguments Republicans are using to defend outrageous tax loopholes. How can people simultaneously demand savage cuts in Medicare and Medicaid and defend special tax breaks favoring hedge fund managers and owners of corporate jets?
A spokesman for Eric Cantor, the House majority leader, told Greg Sargent of The Washington Post: “You can’t help the wage earner by taxing the wage payer offering a job.” He went on to falsely say that the tax breaks at issue mainly help small businesses (they are actually for big corporations). But the basic argument was that anything that leaves more money in the hands of corporations will mean more jobs.
Okay, you dummies, if you believe that, I have a bridge in Brooklyn I can sell you – or how about some forestland in Arizona! It has only been slightly burned!
What about all those trillions in profits from overseas subsidiaries that U.S. corporations are supposed to pay taxes on? They are supposed to pay taxes when those profits are transferred back to the U.S. But these corporations want to bring all that money home to give to the CEOs and the shareholders without paying any taxes. So, now there’s a move afoot by their Republican friends in Congress to offer an “amnesty” under which companies could move funds back home while paying hardly any taxes. And there are some very stupid Democrats supporting this idea, claiming that it would create jobs.
NO, IT WON’T! We have been here before!
A similar tax holiday was offered in 2004, with a similar sales pitch. It was a total failure! Companies took advantage of the amnesty to move a lot of money back to the United States. But they used that money to pay dividends, pay down debt, buy up other companies, and buy back their own stock – everything except creating jobs. There is no evidence that the 2004 tax holiday did anything at all to stimulate the economy. What the tax holiday did do, however, was give big corporations a chance to avoid paying taxes. They would eventually have brought the money home anyway, and paid taxes on it. In return for all the untaxed money, these companies moved even more jobs overseas. Now they now they are pushing their Republican friends to once again let them bring overseas profits home nearly tax-free.
How can anyone imagine that lack of corporate cash is what’s holding back recovery in America right now? After all, it’s widely understood that corporations are already sitting on large amounts of cash that they are NOT using to grow their businesses here at home and hire more Americans. In fact, that idle cash has become a major conservative talking point, with right-wingers claiming that businesses are failing to invest because of political uncertainty.
That is false!
The evidence strongly says that the real reason businesses are sitting on cash is lack of consumer demand. Americans are only buying necessities and growing their savings. If corporations already have plenty of cash they are not using, why would giving them another tax break that would increase their piles of cash do anything to help the recovery?
Lack of corporate cash is not the problem facing America. Big business already has the money it needs to expand; what it lacks is a reason to expand with consumers still on the ropes and the government slashing spending. Claims that a corporate tax holiday would create jobs, or that ending the tax break for corporate jets would destroy jobs, are nonsense.
What our economy needs is direct job creation by the government and mortgage-debt relief for stressed consumers.
What America does not need is a transfer of billions of dollars to corporations that have no intention of hiring anyone except more lobbyists.
AAARRRGGGG!
Edited version of: Corporate Cash Con, By Paul Krugman. NY Times
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