Tag: federal budget

Cross posted from The Stars Hollow Gazette

One  of the signs of insanity is repeating the same mistake in hopes of a different outcome. Seventy five years ago, the congress and President Franklin D. Roosevelt did exactly the same thing that congress and President Barack Obama did on Wednesday with the same results.

FDR’s Recession

By the spring of 1937, production, profits, and wages had regained their 1929 levels. Unemployment remained high, but it was considerably lower than the 25% rate seen in 1933. In June 1937, some of Roosevelt’s advisors urged spending cuts to balance the budget. WPA rolls were drastically cut and PWA projects were slowed to a standstill. The American economy took a sharp downturn in mid-1937, lasting for 13 months through most of 1938. Industrial production declined almost 30 per cent and production of durable goods fell even faster.

Unemployment jumped from 14.3% in 1937 to 19.0% in 1938, rising from 5 million to more than 12 million in early 1938. Manufacturing output fell by 37% from the 1937 peak and was back to 1934 levels. Producers reduced their expenditures on durable goods, and inventories declined, but personal income was only 15% lower than it had been at the peak in 1937. In most sectors, hourly earnings continued to rise throughout the recession, which partly compensated for the reduction in the number of hours worked. As unemployment rose, consumers’ expenditures declined, leading to further cutbacks in production.

The Roosevelt Administration reacted by launching a rhetorical campaign against monopoly power, which was cast as the cause of the depression, and appointing Thurman Arnold in the anti-trust division of the U.S. Department of Justice to act, but Arnold was not effective. In February 1938, Congress passed a new AAA bill which authorized crop loans, crop insurance against natural disasters, and large subsidies to farmers who cut back production. On April 2, Roosevelt sent a new large-scale spending program to Congress, and received $3.75 billion which was split among PWA, WPA, and various relief agencies. Other appropriations raised the total to $5 billion in the spring of 1938, after which the economy recovered.

The stock market plummeted over 500 points yesterday wiping out any gains from the recovery since 2008. The market is continuing to fluctuate after rather weak jobs report. While the U-3 dropped to 9.1%, it was due mostly to workers who are no longer seeking employment or are now in the ranks of the under-employed and jobs creation was weak. So after the debt ceiling deal and the worsening European banks situation, investors lacked confidence that the US could increase productivity.

But the White House and Congress insist on sticking to their story that if they hadn’t given the hostage takers all they wanted with no jobs stimulus or revenue increases, they wouldn’t have gotten the debt deal and the markets would have crashed. As John Nichols said in The Nation, “Unfortunately, it was wrong. Not just morally wrong. Not just politically wrong. Not just economically wrong. It was wrong with regard to the cherished markets.”

Cross posted from The Stars Hollow Gazette

Congress has left town until after the Labor Day weekend leaving the Federal Aviation Agency unfunded. Because the Republican controlled house hates unions and workers, they are holding the FAA hostage on behalf of Delta Airlines. This effects 4,000 FAA employees who have been furloughed, 70,000 contracted construction workers laid off and the loss of $1 billion in tax revenue that will not be collected on ticket sales. While air traffic controllers will continue on the job with pay, safety inspectors are expected to work unpaid. All this because Delta Airlines is in a dispute with workers who want to unionize. Even worse is that most of these workers will be not have health care insurance to take care of themselves or their families.

David Dayen at FDL News gives the details in a nutshell:

Lawmakers in both houses of Congress have passed an FAA authorization bill. The particulars are in the range of 90% the same. While they work something out on the last 10%, they could pass an extension of the old authorization, the way they have 20 times since 2007. But House Republicans want to make it harder for Delta’s workers to unionize. They want to mandate that any absent voter in a union election is a vote against the union. They haven’t yet applied this to their own elections, but that’s how they want unions to operate. The NLRB passed regulations that would ban this practice, and Delta simply won’t allow votes for its workers under the new rules. And Republicans have hijacked the FAA on behalf of Delta.

That’s the real battle behind the FAA authorization, and the main reason that agency is partially shut down right now. The House passed an extension that basically punished rural airports in the states of the main Senate negotiators on the bill. But Harry Reid was actually willing to accept them yesterday and pass the extension. Senate Republicans blocked it by denying unanimous consent.

From Rachel Maddow:

Congress demonstrates a bankruptcy of principles with FAA neglect

Rachel outlines the damage being done in term of jobs and wated public money while the FAA awaits authorization from Congress.

The tea partying Republicans don’t give a rat’s butt about the over 74,000 workers who will add to the unemployment figures this month. Their only concern is the interests of a high flying CEO that contributes heavily to their campaign chests.

The tea partying republicans hate America and are worse than any terrorist group that uses explosives to take lives and destroy this country.

Cross posted from The Stars Hollow Gazette

In the “Shock Doctrine”, Naomi Klein describes disaster capitalism as “treating disasters as exciting market opportunities”. She also explains core economic philosophy of Milton Friedman, an American economist, statistician, academic, and author who taught at the University of Chicago. He was also economic advisor to President Ronald Reagan. What has now become known as the “shock doctrine” is Friedman’s lasting legacy. It is Friedman’s teaching that are at the core of the tactics being used by the Tea Party and the GOP in with the completely manufactured debt ceiling crisis.

Friedman observed in “Capitalism and Freedom:

Only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depends in the ideas that are lying around. That, I believe, is our basic function to develop alternatives to existing policies, to keep them alive and available until the politically impossible  becomes the politically inevitable

This is precisely what has unfolded over the last 11 years since President George W. Bush cut taxes favoring the wealthy and corporations until today with the passage of the bill raising the debt ceiling and the creation of the new “super committee” that will inevitably slash Social Security, Medicare and any other social safety program while raising no revenues.

Friedman also noted that a new administration has a six to nine month window to achieve major changes and if it doesn’t seize the opportunity to act decisively in that period, it won’t get another chance. The Bush administration understood that along with controlling both houses of congress which facilitated the tax cuts, the passage of the Patriot Act and the trillions that were thrown at the wars and the banks in 2008 with TARP.

President Obama had the perfect opportunity to do do much of what he had promised in the first six months if 2009. The question is why didn’t he press his agenda with the Democratic majority controlled congress? If you look closely at his campaign speeches and interviews and his history in politics then the legislative and policy results of the last three years were quite predictable.

It was Rep. John Conyers (D-CA), angered at Obama during this debt ceiling negotiations, who pointed out that it was Obama who put the big three social safety programs on the table, not the Republicans. Republican were decimated in two electoral cycles partially based on the electorate fear that these programs would be thrown to the wolves of corporations and Wall St. Little did most voters realize that it would be a Democratic president and congress that would chisel away at those programs with “shock Doctrine” tactics of making them vulnerable with the ACA, which helped revive the Republicans, and the manufactured debt ceiling crisis.

Some Obama supporters, in attempts to explain his policy’s and what at first glance appears to be failure and leadership weakness, blame the obstructionist tactics of the GOP and feckless blue dogs in the Senate and the tea party. But it was Obama who created the deficit commission to look at ways to cut the deficit. It was Obama who appointed two deficit and anti-social security hawks to chair the commission. And who helped finance it? None other than octogenarian, billionaire Pete Peterson whose life’s goal has been to end Social Security and Medicare.

It was Obama who took single payer off the table even before talks on ACA began. He then proceeded to negotiate behind close doors with hospital executives, insurance and pharmaceutical industry to remove the public option and lower prescription drug costs.

It was Obama who failed to get a strong bank regulatory bill and prosecute the bankers for the fraud in the mortgage and housing collapse. It was Obama who agreed to extend the Bush tax cuts for two more years worsening the deficit and cut payroll taxes making Social Security part of the deficit problem for the first time and actually raising taxes on households making less than $40,000 worsening their economic status. It was Obama who blocked cost of living raises for Social Security recipients and retires federal employees and froze pay for all federal employees.

Some critics are trying to explain away all these events as weakness either do not understand, or are just ignoring, that this latest “crisis” ws as much Obama’s making as it was the tea party’s.

Paul Krugman gets it now when he concluded that this is what Obama wants

Glenn Greenwald said “the President wanted tax revenues to be part of this deal.  But it is absolutely false that he did not want these brutal budget cuts and was simply forced — either by his own strategic “blunders” or the “weakness” of his office — into accepting them.  The evidence is overwhelming that Obama has long wanted exactly what he got: these severe domestic budget cuts and even ones well beyond these, including Social Security and Medicare, which he is likely to get with the Super-Committee created by this bill.”

At “Rolling Stone”, Matt Taibbi, on pondering Obama’s tack to starboard, thinks that Obama is doing what he is told

The Democrats, despite sitting in the White House, the most awesome repository of political power on the planet, didn’t fight at all. They made a show of a tussle for a good long time — as fixed fights go, you don’t see many that last into the 11th and 12th rounds, like this one did — but at the final hour, they let out a whimper and took a dive.

We probably need to start wondering why this keeps happening. Also, this: if the Democrats suck so bad at political combat, then how come they continue to be rewarded with such massive quantities of campaign contributions? When the final tally comes in for the 2012 presidential race, who among us wouldn’t bet that Barack Obama is going to beat his Republican opponent in the fundraising column very handily? At the very least, he won’t be out-funded, I can almost guarantee that.

And what does that mean? Who spends hundreds of millions of dollars for what looks, on the outside, like rank incompetence?

It strains the imagination to think that the country’s smartest businessmen keep paying top dollar for such lousy performance. Is it possible that by “surrendering” at the 11th hour and signing off on a deal that presages deep cuts in spending for the middle class, but avoids tax increases for the rich, Obama is doing exactly what was expected of him?

Yes, that is exactly what he is doing. This was and is Obama’s plan.

h/t Vastleft for the graphic

Cross posted from The Stars Hollow Gazette

The Boehner bill on raising the debt ceiling barely passed the House on a strict partisan line with a vote of 218 to 210. Not one Democrat voted for the bill, 22 Republicans voted against it and 5 Democrats were not present to vote. The bill was essential dead on arrival in the Senate where it was quickly table in a bipartisan vote of 59 to 41.

This is what’s next but it won’t happen until very late Saturday night/early Sunday morning. Why because Sen. Mitch McConnell says so. McConnell is refusing to even negotiate with Reid

Senate Majority leader Harry Reid’s proposed bill is no prize either but at least it moves the debt ceiling limit to past the 2012 election into 2013 and a new congressional session. (I think Reid is betting on taking back the House.) Reid also said that he is open to tweaking but it’s up to Republicans

At a late Friday press conference, Reid suggested that the door is still open to further tweak his proposal, including by adding failsafes to assure future entitlement and tax reforms — but it’s up to Republicans to offer up their votes.

“We have a closet full of triggers, people have suggested dozens of them but even though earlier this week, I was sitting talking to Jack Lew about triggers for an hour and a half and we can’t get Republicans to move on any trigger. We’re not going to have cuts on more programs without some revenue – that is a line we’ve drawn in the sand,” Reid said. “It’s up to the Republicans, right now we have a proposal…we are waiting for them to do something, anything, move toward us.”

How The Revised Reid Amendment Compares To The Revised Boehner Bill

h/t David Dayen @ FDL and Brian Buetler @ TPM

Up Date, 12:22 PM EDT: House Speaker John Boehner has said that the Reid bill is “dead in the water” and is refusing to meet or compromise with the Democrats. The Senate will vote for cloture on the bill at 1 AM Sunday morning. Boehner plans to hold a symbolic vote on the bill this afternoon to reject the plan preemptively.

Reid’s plan which cuts more without new revenue and creates the “super commission” only differs in the length of time for considering raising the debt ceiling again. The bi[artisan Senate plan extends the debt ceiling through 2012 while the tea party plan wants it rehashed in 5 months with guarantees that a “cut, cap and destroy” constitutional amendment is passed. Boehner is probably the worst house speaker since Newt Gingrich and even he knew how to get his ducks in a row and conpromise.

Up Date: 15:35 EDT The House has voted to reject the Reid bill before it even gets to a vote in the Senate. All of the Republicans votes nay along with a few Democrats. The voter was 173 – 246.

House Minority Leader Nancy Pelosi and Sen. Reid are on their way to the White House to meet with the President to presumably to discuss options and the next move.

This is what you get for negotiating with terrorists.

The Reid bill will still come to a vote late tonight at 1 AM EDT

Up Date 1430 EDT: The Reid bill failed to reach cloture this afternoon it is now back to the drawing board

Cross posted from The Stars Hollow Gazette

The bills that have been proposed by Republican and Democratic leadership to raise the debt ceiling putting an an to this wholly manufactured crisis, differ little and both will be devastating to most Americans. One of the commonalities is the creation of a bipartisan commission of 12 that on first glance seems innocuous but on looking closer, it is quite toxic and may even be unconstitutional. This “super committee” will be equally comprised of Democrats and Republicans members of congress. Who and how they will be selected is unclear but considering the current corporate owned, deficit hawk nature of both sides, I suspect it will be their worst conservative “cut spending/no revenue ghouls”.

At first glance, this sounds like the President’s Deficit Commission that couldn’t produce recommendations even 14 of the 18 members could agree. The co-chairs, former Sen. Alan Simpson (R-WY) and former Clinton Chief of Staff and South Carolina businessman, Erskine Bowles wrote there own recommendations and ran it up the flagpole. Needless to say President Obama saluted and embraced the draconian principles that it enshrined, such as decimating Medicare and Medicaid and drastic cuts to Social Security. The “Catfood Commission”, however, had no “teeth”, everything that was suggested would have to be passed as a bill. This new commission is another game and will have the force of law behind it.

Ryan Grimm at Huffington Post has the best description of how this “new congress” will function and just how powerful it will be:

Legislation approved by the Super Congress — which some on Capitol Hill are calling the “super committee” — would then be fast-tracked through both chambers, where it couldn’t be amended by simple, regular lawmakers, who’d have the ability only to cast an up or down vote. With the weight of both leaderships behind it, a product originated by the Super Congress would have a strong chance of moving through the little Congress and quickly becoming law. A Super Congress would be less accountable than the system that exists today, and would find it easier to strip the public of popular benefits. Negotiators are currently considering cutting the mortgage deduction and tax credits for retirement savings, for instance, extremely popular policies that would be difficult to slice up using the traditional legislative process.

House Speaker John Boehner (R-Ohio) has made a Super Congress a central part of his last-minute proposal, multiple news reports and people familiar with his plan say. A picture of Boehner’s proposal began to come into focus Saturday evening: The debt ceiling would be raised for a short-term period and coupled with an equal dollar figure of cuts, somewhere in the vicinity of a trillion dollars over ten years. A second increase in the debt ceiling would be tied to the creation of a Super Congress that would be required to find a minimum amount of spending cuts. Because the elevated panel would need at least one Democratic vote, its plan would presumably include at least some revenue, though if it’s anything like the deals on the table today, it would likely be heavily slanted toward spending cuts.

The tea party Republicans in the House have informed Speaker John Boehner that the commission is totally unacceptable to them. There main objection is they feel it could lead to tax increases. Other critics from the right like Eric Erickson of Red State are opposed mostly because it just ads another costly layer to the bureaucracy that won’t work. From the left, Rep Barney Frank (D-MA) and MoveOn.org expressed concerns that it would cut the big three social safety nets and the idea that it would supersede congress’s parliamentary power.

The ratings agencies have said that the Boehner bill will result in a ratings downgrade since it only raised the debt ceiling by $1 trillion which will require another cap raise in 5 months, creating uncertainty in the bond market. The White House has embraced the Reid version which would move the need raising the ceiling again past 2012 which is more acceptable to the ratings agencies who think the ceiling should just be removed entirely.

This is going to the wire with both sides deadlocked and hamstrung by a small loud and incredibly stupid minority and ineffective leaderchip on both sides.

Cross posted from The Stars Hollow Gazette

The bills that have been proposed by Republican and Democratic leadership to raise the debt ceiling putting an an to this wholly manufactured crisis, differ little and both will be devastating to most Americans. One of the commonalities is the creation of a bipartisan commission of 12 that on first glance seems innocuous but on looking closer, it is quite toxic and may even be unconstitutional. This “super committee” will be equally comprised of Democrats and Republicans members of congress. Who and how they will be selected is unclear but considering the current corporate owned, deficit hawk nature of both sides, I suspect it will be their worst conservative “cut spending/no revenue ghouls”.

At first glance, this sounds like the President’s Deficit Commission that couldn’t produce recommendations even 14 of the 18 members could agree. The co-chairs, former Sen. Alan Simpson (R-WY) and former Clinton Chief of Staff and South Carolina businessman, Erskine Bowles wrote there own recommendations and ran it up the flagpole. Needless to say President Obama saluted and embraced the draconian principles that it enshrined, such as decimating Medicare and Medicaid and drastic cuts to Social Security. The “Catfood Commission”, however, had no “teeth”, everything that was suggested would have to be passed as a bill. This new commission is another game and will have the force of law behind it.

Ryan Grimm at Huffington Post has the best description of how this “new congress” will function and just how powerful it will be:

Legislation approved by the Super Congress — which some on Capitol Hill are calling the “super committee” — would then be fast-tracked through both chambers, where it couldn’t be amended by simple, regular lawmakers, who’d have the ability only to cast an up or down vote. With the weight of both leaderships behind it, a product originated by the Super Congress would have a strong chance of moving through the little Congress and quickly becoming law. A Super Congress would be less accountable than the system that exists today, and would find it easier to strip the public of popular benefits. Negotiators are currently considering cutting the mortgage deduction and tax credits for retirement savings, for instance, extremely popular policies that would be difficult to slice up using the traditional legislative process.

House Speaker John Boehner (R-Ohio) has made a Super Congress a central part of his last-minute proposal, multiple news reports and people familiar with his plan say. A picture of Boehner’s proposal began to come into focus Saturday evening: The debt ceiling would be raised for a short-term period and coupled with an equal dollar figure of cuts, somewhere in the vicinity of a trillion dollars over ten years. A second increase in the debt ceiling would be tied to the creation of a Super Congress that would be required to find a minimum amount of spending cuts. Because the elevated panel would need at least one Democratic vote, its plan would presumably include at least some revenue, though if it’s anything like the deals on the table today, it would likely be heavily slanted toward spending cuts.

The tea party Republicans in the House have informed Speaker John Boehner that the commission is totally unacceptable to them. There main objection is they feel it could lead to tax increases. Other critics from the right like Eric Erickson of Red State are opposed mostly because it just ads another costly layer to the bureaucracy that won’t work. From the left, Rep Barney Frank (D-MA) and MoveOn.org expressed concerns that it would cut the big three social safety nets and the idea that it would supersede congress’s parliamentary power.

The ratings agencies have said that the Boehner bill will result in a ratings downgrade since it only raised the debt ceiling by $1 trillion which will require another cap raise in 5 months, creating uncertainty in the bond market. The White House has embraced the Reid version which would move the need raising the ceiling again past 2012 which is more acceptable to the ratings agencies who think the ceiling should just be removed entirely.

This is going to the wire with both sides deadlocked and hamstrung by a small loud and incredibly stupid minority and ineffective leaderchip on both sides.

Cross posted from The Stars Hollow Gazette

As we move closer to the debt ceiling limit and defaulting on the debt, two proposals have been put forward by opposing sides. The Republicans have put a bill together that will come up for a vote on Wednesday that calls for a two-step plan that would allow the debt limit to be raised by $1 trillion and create “a “Super Congress,” composed of members of both chambers and both parties, isn’t mentioned anywhere in the Constitution, but would be granted extraordinary new powers.”

From the Democrats, House Majority Leader Harry Reid has proposed $2.7 trillion in spending cuts and raising the debt ceiling through 2012 with no revenue increases but would not touch any of the big three social safety nets. It does include the proposed “super congress”:

“made up of 12 members, to present options for future deficit reduction. The committee’s recommendations will be guaranteed an up-or-down Senate vote, without amendments, by the end of 2011.”

There are a few problems though. The first problem is the neither bill will pass both houses. The other obstacle two-fold. Reid’s bill will need 60 votes for cloture. It is unlikely that Reid can convince four Republicans to vote for it. He may get able to convince Sen, Olympia Snowe (R-VT) and Sen. Collins (R-ME) but he also must get the blue dogs to fall in-line. The only way I can see Reid getting this bill to the floor for a vote is to use the “Cheney nuclear option” and call bull shit on the filibuster. They don’t have the guts for that.

House Speaker John Boehner has similar problems. He needs 217 votes to pass. With 89 tea party Republicans many who signed a letter refusing to raise the debt ceiling no matter what the deal, Boehner would need to convince at least 23 to 50 Democrats. That won’t happen either. Some of the tea party crew may break tier “oath” since they are taking heat from their constituents at home. The House bill stands a better chance of suvival.

If both bills by some miracle pass, then it goes to reconciliation and both bills have to be voted on again. This isn’t going to happen in less than a week. If only the House bill makes it, the Senate probably reject it. That is the most probable scenario.

That leaves one option and it falls back to the White House to use the 14th Amendment, Article 4. Obama has already rejected this option but as it gets closer to August 2 and default, given the choice of a constitutional crisis versus a global economic melt down, let hope Obama put his “big boy pants on” and starts acting like a responsible adult who has to make a decision not everyone is going to like.

Cross posted from The Stars Hollow Gazette

President Obama’s Chief of Staff Bill Daley, former bankster and Third Way board member, thinks that it is “the deficit is a serious drag on the economy.” You would think that the Tea Party Republicans had taken over the White House. Oh, wait, they have.

Mr. Daley appeared on Meet the Press with corporate shill, David Gregory

As Scarecrow at FDL points out

Apparently, the man closest to the President of the United States, and on whom the President relies for political and economy advice, does not know that the only reason the terrible unemployment numbers that may end his President’s re-election hopes are at 9.2 percent and not 11 or 12 percent or higher is because of the increased federal deficit spending of the last two years.

And the only thing that can keep unemployment from reaching higher levels in 2012 is continued federal spending, which they will cover via more deficits. If Mr. Daley’s diagnosis were translated into policy – and that seems to be what’s happening – he and his President will need new jobs in 2013.

Mr. Daley and the completely useless David Gregory totally ignore the real causes for current economic disaster:

On the debt reduction negotiations, David Gregory asked Mr. Daley what he must have thought was a gotcha now question. He showed Mr. Daley a graphic showing the increase in the total debt since Obama took office, with the debt going from $10 trillion to $14 trillion or so, and projected to rise another $2 trillion.

Then Gregory smuggly concluded, “can’t you [Mr. Daley] see the logic of those who argue that given this huge increase in the debt, it makes sense that we reduce that only with spending cuts and not tax increases?”

The correct response to a question that jaw-droppingly stupid would have been to award Gregory the Douglas Feith Award and terminate his contract with NBC. Daley may not get the allusion and couldn’t say that in any event.

But in responding, Daley couldn’t even remember to remind viewers that the bulk of that debt increase was entirely the result of the recession: fallen tax revenues and increased safety-net spending, plus the stimulus, all responding to the recession Mr. Obama inherited. Instead, he left us with the lecture on how the debt or deficit was a serious drag on the economy, so our President was really focused on that.

Scarecrow is so right that “there are no more adults in this conversation.”

 

Cross posted from The Stars Hollow Gazette

Catfood is made out of peas? Who knew? lambert

This press conference tells us that the austerity crap isn’t some bit of political posturing, it’s a belief. We’re doomed. Atrios

The right wing Republican talking points that were spewed by President Obama at his press conference were so thick that it has left no doubt the president is about to sell out the middle class and poor.

President Obama said Monday that he had “bent over backwards” to forge a compromise with Republicans on a debt limit deal – and that it was time for them to “budge.”

“I am prepared to take on significant heat from my Party to get something done and I expect the other side to be willing to do the same thing,” he said. . . . .

“We have to pull off the Band-aid — to eat our peas,” he said.

I don’t often agree with NYT Columnist Russ Douthat but his analysis of the “madness” cuts to the point:

Barack Obama wants a right-leaning deficit deal.  

The not-so-secret secret is that the White House has given ground on purpose. Just as Republicans want to use the debt ceiling to make the president live with bigger spending cuts than he would otherwise support, Obama’s political team wants to use the leverage provided by those cra-a-a-zy Tea Partiers to make Democrats live with bigger spending cuts than they normally would support. . . .

Why? Because the more conservative-seeming the final deal, the better for the president’s re-election effort. In that environment, Republicans have every incentive to push and keep pushing. Since any deal they cut will be used as an election-year prop in 2012, they need to make sure the president actually earns his budget-cutting bona fides.

The problem is that voters don’t care about the deficit. They care about jobs and the economy. Spending cuts, tax cuts and austerity programs do ot create jobs. Even Ronald Reagan’s budget director, David Stockman, now admits that Reaganomics and the Bush tax cuts are a major cause of the current “debt crisis” and takes Obama and Rep. Paul Ryan to the “woodshed”

“In attacking the Bush tax cuts for the top 2 percent of taxpayers, the president is only incidentally addressing the deficit,” he writes. “Mr. Obama is thus playing the class-war card more aggressively than any Democrat since Franklin D. Roosevelt – surpassing Harry S. Truman or John F. Kennedy when they attacked big business or Lyndon B. Johnson or Jimmy Carter when they posed as champions of the little guy.”

“On the other side,” he continues, “Representative Ryan fails to recognize that we are not in an era of old-time enterprise capitalism in which the gospel of low tax rates and incentives to create wealth might have had relevance.”

Eat your peas, we are doomed.

Cross posted from The Stars Hollow Gazette

There are no more “normal” people in charge of government these days, nor are any of them reasonable:

Paul Krugman Not A normal Party:

But I’m unreliable and shrill, of course – you weren’t supposed to realize that the GOP had gone off the deep end that early in the game.

David Brooks: The Mother of All No-Brainers

If the Republican Party were a normal party, it would take advantage of this amazing moment. It is being offered the deal of the century: trillions of dollars in spending cuts in exchange for a few hundred million dollars of revenue increases.

A normal Republican Party would seize the opportunity to put a long-term limit on the growth of government. It would seize the opportunity to put the country on a sound fiscal footing. It would seize the opportunity to do these things without putting any real crimp in economic growth.

The party is not being asked to raise marginal tax rates in a way that might pervert incentives. On the contrary, Republicans are merely being asked to close loopholes and eliminate tax expenditures that are themselves distortionary.

This, as I say, is the mother of all no-brainers.

Richard Cohen: A grand old cult

Someone ought to study the Republican Party. I am not referring to yet another political scientist but to a mental health professional, preferably a specialist in the power of fixations, obsessions and the like. The GOP needs an intervention. It has become a cult.

To become a Republican, one has to take a pledge. It is not enough to support the party or mouth banalities about Ronald Reagan; one has to promise not to give the government another nickel. This is called the “Taxpayer Protection Pledge,” issued by Americans for Tax Reform, an organization headed by the chirpy Grover Norquist. He once labeled the argument that an estate tax would affect only the very rich “the morality of the Holocaust.” Anyone can see how singling out the filthy rich and the immensely powerful and asking them to ante up is pretty much the same as Auschwitz and that sort of thing.

snip

This intellectual rigidity has produced a GOP presidential field that’s a virtual political Jonestown. The Grand Old Party, so named when it really did evoke America, has so narrowed its base that it has become a political cult. It is a redoubt of certainty over reason and in itself significantly responsible for the government deficit that matters most: leadership. That we can’t borrow from China.

Time in House Could Be Short for Republican Newcomers

It is miles to go before the 2012 Congressional races begin in earnest, but already some of the 87 freshmen who helped the Republicans win back the House last year are bracing for a challenge from within the party. At least half a dozen potential primary challengers to freshmen are considering a run, and there is heated chatter about more.

In some ways, the freshmen are responsible for their own predicament. Many won their seats after successfully challenging establishment Republicans in primaries, proving that a combination of gumption and the right political climate could overcome the advantages of incumbency.

Now, to some of the impatient and ideological voters who sent them to Washington to change things, the new House members may be seen as the establishment, and they face the disconcerting prospect of immediately defending themselves in the political marketplace.

The White House and the Democratic leadership aren’t any better having dropped the ball and allowed a small “cult” of unreasonable people to dictate the game. Obama was suppose to be “the adult in the room” according to his fans. He could have easily had the upper hand in his first two years in office if he had listened to reason about the economy and put his “foot down” like an “adult”. There is little reason to think that the Democrats will listen to “normal” people now

Cross posted from The Stars Hollow Gazette

Nobel Prize winning Economist and New York Times columnist Paul Krugman has nailed Barack Obama’s economic polices and his penchant for feeding the right wing economic fallacies, as “the false government-family equivalence, the myth of expansionary austerity, and the confidence fairy” and, as Dr. Krugman points out, Obama did it in two sentences:

Government has to start living within its means, just like families do. We have to cut the spending we can’t afford so we can put the economy on sounder footing, and give our businesses the confidence they need to grow and create jobs.

Dr. Krugman has already debunked both the myths of government-family equivalence and expansionary austerity. Yet the President still thinks that by caving to the right wing Hoover economic policies the economy will get better. This appears to be a signal that he is about to cave to Republicans once again on spending cuts and no new revenue sources that has led will further slow the economy and may spiral the US into a second recession or worse.