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Hell Hath No Fury Like A Woman Scorned..Or A Progressive Commentator Ticked Off At Poopy Fixed Bills: Keith Olbermann Drops The Ultimate Special Comment
The best thing for any entertainer or journalist to have — well, other than a fat contract – is creative freedom. Which means, you are under no pressure from anyone to tone down your craft, and that you can basically sound off on the issues of the day.
Thankfully for us, Keith Olbermann’s found that creative freedom at Current TV…even if they may not reach quite as many homes as his previous domicile of MSNBC, having Al Gore as his boss rather than Phil Griffin has done wonders for not having to have someone over his head tut-tutting about how what the bosses think.
Very few political commentators — except probably Rush Limbaugh for the Hard Right — have that much creative control as Olbermann has at Current. (OK, perhaps Rachel Maddow at MSNBC, but we’ll have to see if the meddlesome intervention streak of Griffin decides to encroach on her soon enough.)
Which is why people on the Left are especially glad KO is on our side.
And, after nuclear blasts like the Special Comment he gave tonight on the debt ceiling “compromise” that passed the House today, I don’t think he’ll be lacking for allies any time soon, either.
Remember, he is a trained professional. Do not try this at home without proper supervision.
I’ll include as well the written transcript below the clip as well.
Countdown with Keith Olbermann (CurrentTV); 8-1-11 “Special Comment” on the debt ceiling “compromise” bill that cleared the House of Representatives today (from YouTube via MiniRtst, h/t to FOKSociety.com)
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[Transcript of above "Special Comment", courtesy of FOK Society forum]
I close, as promised, with a Special Comment on the debt deal.
Our government has now given up the concept of right and wrong.
We have, in this deal, declared that we hold these truths to be self-evident: that all political incumbents are created equal, that they are endowed by their creator with certain unalienable Rights, that among these are Re-nomination, re-election, and the pursuit of hypocrisy.
We have, in this deal, gone from the Four Freedoms to the Four Great Hypocrisies.
We have superceded Congress to facilitate 750 billion dollars in domestic cuts including Medicare in order to end an artificially-induced political hostage crisis over debt, originating from the bills run up by a Republican president who funneled billions of taxpayer dollars to the military-industrial complex by unfunded, unnecessary, and unproductive wars, enabled in doing so by the very same Republican leaders who now cry for balanced budgets – and we have called it compromise. And those who defend it have called it a credit to a pragmatic president who wins some sort of political “points” because, having stood for almost nothing here, he gave away almost nothing for which he stood.
It would be comical if it were not tragic.
Either way, it is a signal moment in our history, in which both parties have agreed and codified that the political structure of this nation shall now based entirely on hypocrisy and political self-perpetuation.
Let us start with the first of the Great Hypocrisies: The Committee.
The Republican dogs can run back to their corporate masters and say they have forced one-and-one-half trillion dollars in cuts and palmed off the responsibility for them on this nonsensical “Super Congress” committee.
For two-and-a-half brutal years we have listened to these Tea Party mountebanks screech about the Constitution of the United States as if it were the revealed word and not the product of other – albeit far better – politicians. They demand the repeal of Amendments they don’t like, and the strict interpretation of the ones they do, and the specific citation of authorization within the Constitution for every proposed act or expenditure or legislation.
Except this one.
Where does it say in the Constitution that the two houses of Congress can, in effect, create a third house to do its dirty work for it; to sacrifice a few Congressmen and Senators so the vast majority of incumbents can tell the voters they had nothing to do with this?
This leads to the second of the Great Hypocrisies: how, in the same breath, the Republicans can create an extra-Constitutional “Super Congress” and yet also demand a constitutional amendment to force the economic stupidity that would be a mandated balanced budget.
Firstly: pick a side! Ignore the Constitution or adhere to it.
And of what value would this mandated balanced budget be? Our own history proves that at a time of economic crisis, if the businesses aren’t spending, and the consumers aren’t spending, the government must. Our ancestors were the lab rats in the horrible experiments of the Hoover Administration that brought on the Great Depression, in which the government curled up into a ball while it simultaneously insisted the economy should heal itself, when, in times of crisis – then and now – the economy turns out to be comprised entirely of a bunch of rich people who will sit on their money no matter if the country starves.
Forgotten in the Republican Voodoo dance, dressed in the skins of the mythical Balanced Budget, triumphant over the severed head of short-term retrenchment that they can hold up to their moronic followers, are the long-term implications of the mandated Balanced Budget.
What happens if there’s ever another… war?
Or another… terrorist attack?
Or another… natural disaster?
Or any other emergency that requires A government to spend a dollar morethan it has? A Constitutional Amendment denying us the right to run a deficit, is madness, and it will be tested by catastrophe sooner than any of its authors with their under-developed imaginations that can count only contributions and votes, can contemplate.
And the third of the Great Hypocrisies is hidden inside the shell game that is the Super Congress.
The Super Congress is supposed to cut evenly from domestic and defense spending, but if it cannot agree on those cuts, or Congress will not endorse them, there will be a “trigger” that automatically cuts a trillion-two or more – but those cuts will not necessarily come evenly from the Pentagon. We are presented with an agreement that seems to guarantee the gutting of every local sacred cow from the Defense Department. Except if the Congressmen and Senators to whom the cows are sacred, disagree, and overrule, or sabotage the Super Congress, or, except if for some reason a 12-member Committee split evenly along party lines can’t manage to avoid finishing every damned vote 6-to-6.
We’re cutting Defense. Unless we’re not.
The fourth of the Great Hypocrisies is the evident agreement to not add any revenues to the process of cutting.
Not only is the impetus to make human budget sacrifices out of the poor and dependent formalized… but the rich and the corporations are thus indemnified, again, and given more money not merely to spend on themselves and their own luxuries, but more vitally, they are given more money to spend on buying politicians, and legislatures, and courts, buying entire states, all of which can be directed like so many weapons, in the service of one cause and one cause alone: making by statute and ruling, the further protection of the wealthy at the expense of everybody else, untouchable, inviolable – permanent.
The White House today boasted of loopholes to be closed and tax breaks to be rescinded — later. By a committee. A committee that has yet to be formed.
There are no new taxes. Except the stealth ones, enacted on 99 out of 100 Americans by this evil transaction. Every dollar cut from the Safety Net is another dollar added to the citizen’s cost for education, for security, for health, for life itself. It is another dollar he can’t spend on making a better life for himself, or at least his children. It is another dollar he must spend instead on simply keeping himself alive.
Where is the outrage over these Great Hypocrisies?
Do you expect it to come from a corrupt and corrupted media, for whom access is of greater importance than criticizing the failure of a political party or defending those who don’t buy newspapers or can’t leap website paywalls or could not afford cable TV?
Do you expect it to come from a cynical and manipulative political structure? Do you expect it from those elected officials who no longer know anything of government or governance, but only perceive how to get elected, or how to pose in front of a camera and pretend to be leaders?
Do you expect it from politicians themselves, who will merely calculate whether or not it’s right based on whether or not it will get them more contributions?
Do you expect it will come from the great middle ground of this country, with a population obsessed with entertainment, video games, socialmedia, sports, and trivia?
Where is the outrage to come from? From you!
It will do no good to wait for the politicians to suddenly atone for their sins. They are too busy trying to keep their jobs, to do their jobs.
It will do no good to wait for the media to suddenly remember its origins as the ‘free press,’ the watchdog of democracy envisioned by Jefferson. They are too busy trying to get exclusive DETAILS about exactly how the bankrobbers emptied the public’s pockets, to give a damn about telling anybody what they looked like, or which way they went.
It will do no good to wait for the apolitical public to get a clue. They can’t hear the clue through all the chatter and scandal and diversion and delusion and illusion.
The betrayal of what this nation is supposed to be about did not begin with this deal and it surely will not end with this deal. There is a tide pushing back the rights of each of us, and it has been artificially induced by union-bashing and the sowing ofhatreds and fears, and now this ever-more-institutionalized economic battering of the average American. It will continue, and it will crush us, because those who created it are organized and unified and hell-bent.
And the only response is to be organized and unified and hell-bent in return. We must find again the energy and the purpose of the 1960′s and early 1970′s and we must protest this deal and all the God damn deals to come, in the streets.
We must arise, non-violently but insistently. General strikes, boycotts, protests, sit-ins, non-cooperation take-overs – but modern versions of that resistance, facilitated and amplified, by a weapon our predecessors did not have: the glory that is instantaneous communication.
It is from an old and almost clichéd motion picture that the wisdom comes: First, you’ve got to get mad.
I cannot say to you, meet here or there at this hour or that one, and we will peacefully break the back of government that now exists merely to get its functionaries re-elected. But I can say that the time is coming when the window for us to restore the control of our government to our selves will close, and we had damn well better act before then.
Because this deal is more than a tipping point in which the government goes from defending the safety net to gutting it. This is wrong, and while our government has now declared that it has given up the concept of right-and-wrong, you and I… have not, and will not, do so.
Good night, and good luck
The Anticlimatic Climax of #Debtpocalypse (The House Of Representatives Edition)…Now With 75% MORE Shiftiness AND A FREE Gabrielle Giffords Sighting!!!
Well, Clones…the deed is finally done for the debt ceiling bill in the House of Representatives.
The final count on passage: 269 “aye” votes, compared to 161 voting “no”.
Democrats split right down the middle: 95 for and 95 against. Republicans split among “ideological” lines, with 66 voting against (mostly the Tea Party Caucus members). and the remaining establishment conservatives voting for.
Most of the Congressional Progressive and Black caucuses kept their promise and voted against the deal, though CBC chair Emanuel Cleaver (MO) did say that if his votes had been needed to pass the bill, he and most of the caucus members would have swung their vote to “yes” to pass the bill through.
All of the Tea Party Caucus members (including Bachmann, King, Gohmert, and the other usual firebrands, with the exception of the House leadership, voted against the proposal.
A full detail of the roll call vote can be found here.
In all the venality and absurdity of the atmosphere, there was one bright spot, though: Congresswoman Gabrielle Giffords, the woman who was last year nearly the fatal victim of a Tea Party terrorist attack, made her triumphant return to the floor to cast her vote (a “yes”) for the legislation. She received a heart-felt standing ovation from the chamber; some, like Rep. John Lewis, even openly wept in emotional joy at her recovery. No word of any reaction from the Tea Partiers, though.
So now, it’s off to the Senate, where a vote will be scheduled for tomorrow. Barring any last minute surprises (such as an attempted brief filibuster by either Mike Lee or Bernie Sanders for diametrically different reasons), the bill should be approved and sent to President Obama’s desk for his signature by Tuesday evening..right on the verge of default happening.
And then, the real fun of picking the members of the “Super Congress” committee will commence, the attention and drama will shift to the battle of the fiscal year 2012 budget appropriations bills and the threat of a government shutdown come October 1st.
For now, though, all is now finally quiet, since the House is now in their August recess..or as they call it, their “district work period”. The rest of the country??? Probably not so quiet.
For Those Who Insist On Seeing The Glass As Half Full Even When There’s Only A Drop Of Water: My Fisking Of An “Obamabot” Defense Of The Debt Ceiling “Compromise”
[8-17-11: Update #2: Scroll to bottom of page.]
[Slight edit update to correct the record on Jane Hamsher, thanks to commenter Chatty Kathy for the correction.]
Well, daylight has come, and more reaction is coming in fast and furious on the debt ceiling deal that was reached last night.
The prevailing view on the Village Idiot Media Center is that the deal is nothing short of brilliant, since it staves off the grim reaper of default and gives some time for the country to attack the problem of the deficit…even if by doing so, it tilts the political dynamic well to the Right by emphasizing cuts in the size and breadth of government.
The prevailing view on the Far Right, of course, is a bit different: evenly divided between those like Grover Norquist who say that this is a first installment on the ultimate plan of drowning “big government” and unleashing the full power of unfettered “prosperity’ from “free market capitalism; and those like Rush Limbaugh, Glenn Beck, and the Tea Party apparatus who would much rather have the full payment now or have the economic Armageddon happen quickly and immediately, so that the country can be immediately rebuilt in their neo-Confederate image.
Meanwhile, on the Left/liberal side, there is simply outrage and shock that a Democratic President would put at risk major portions or the legacy of the New Deal just to gain an agreement with the very people who don’t even recognize him as an equal, let alone as President. The anger is so thick that cries for primarying President Barack Obama are expressed openly by enraged liberal Dems and independent progressives.
However…there are some who call themselves liberals and progressives who still want to believe in the President, that will forever spin everything he does as nothing more than brilliance and “30-dimensional chess”, and will find, even in the biggest haystack, the golden needle that justifies his strategy and debunks all the critics as “emoprogs” and “Left ideologues” who put their own hysteria above reality.
The People’s View blog is one such example of such “Obambot” worship. They have been one of the loudest voices on the “liberal” side for defending Prez O’s actions against the critics on the Left, and they aren’t shy in naming names, either. Salon.com columnist Glenn Greenwald, for example, was previously called out as a “right-wing populist”, a “libertarian”, and even an anti-Latino “racist” (using one 2005 Salon column he printed where he kinda sorta somewhata agreed with a point by Ron Paul about immigration…but mostly because Greenwald happened to call out Obama and the Democrats’ treatment of liberals as mere stepping stones to be seen at election time and not heard any time else. Similarly, sister Salon.com columnist Joan Walsh was equally pilloried by People’s Daily and other Twitter Obama loyalists when she dropped the “asshole” bomb on defenders of Prez O’s negotiating skills (or lack thereof), and Firedoglake’s founder Jane Hamsher has been especially targeted because in a recent FDL diary, she referred to Obama loyalists as “the dumbest mutherfuckers on the face of the earth”.
Course, the hatefest between Hamsher and Obama loyalists go way back, as far back as the 2008 Presidential primary, when Hamsher was a big Hillary Clinton backer Firedoglake was at the epicenter of the Great “Obambot” vs. “PUMA’” pissing contest, where the more fervent Hillary Clinton backers there were furiously going to extremes trying to paint Obama as unqualified…even going as far as invoking his race and passing on thinly veiled smears about Michelle Obama being a “Whtey” hater. Hamsher also had been giving money out to other bloggers critical of Obama at that time…including Greenwald..which explains the hatemongering towards him as well.
But..that’s neither here nor there, so let’s not digress.
To the folks at People’s Daily, Obama’s doing the best he can with the hand he’s dealt, and he’s kicking the Republican’s asses all over the field..and if the “emoprogs” would just STFU and back him full tilt and quit enabling the Right through division, then all would be wonderful.
Which brings us to……their analysis of the debt ceiling compromise bill, which was posted by correspondent “Deaniac83″ this morn. Basically, D83 seeks to defuse the memes going around by the “emoprogs” that the deal was simply an unmitigated disaster for liberals that greases the wheels for drastic, soul-killing cuts in social programs in the middle of a recession, and which all but kills any hope of extending the New Deal social programs beyond the horizon. In his view, however, the bill actually looks a lot better than the hype, and even counts as a major win against the forces of evil.
Well…let’s see if he’s actually correct in that, or just projecting his usual Obamamania.
First off, Deniac takes a proverbial bat to the head of Paul Krugman, New York Times economic columnist and one of the loudest critics of Prez O’s overall economic rightward tilt.
Paul Krugman is a political rookie. At least he is when compared to President Obama. That’s why he unleashed a screed as soon as word came about the debt ceiling compromise between President Obama and Congressional leaders – to, you know, avert an economic 9/11. Joining the ideologue spheres’ pure, fanatic, indomitable hysteria, Krugman declares the deal a disaster – both political and economic – of course providing no evidence for the latter, which I find curious for this Nobel winning economist. He rides the coattails of the simplistic argument that spending cuts – any spending cuts – is bad for a fragile economy, ignoring wholeheartedly his own previous cheerleading for cutting, say, defense spending. But that was back in the day – all the way back in April of this year.
Now..aside from the hilarity of referring to the long-time columnist of the Times as a “political rookie” (you mean, unlike the blog writer, who fails to note how his own economic expertise compares to that of Krugman’s, other than political smack-running??), he ignores the basic fact that Krugman’s full case is that of the classic liberal Kenyesian: that cutting domestic spending across the board in the middle of a deep recession is NOT going to promote any form of economic growth that will benefit the public…unless you are a Reaganite “supply-sider” who thinks that tax cuts miraculously will generate so much “prosperity” that government revenues will explode enough to pay for the cuts. (Or a Tea Party old school conservative, who believes that simply doing away with whole chunks of government not dealing with defense, prisons, surveillance, or bare essentials, combined with the gold standard, will restore the old 19th Century glory,)
Also not D83′s emphasis on cracking Krugman on “defense spending”…surely, the former isn’t implying that the Pentagon budget should not be touched, because spending on endless wars is actually GOOD for the country, isn’t he?? The “Obama KILLED Bin Laden!!!!” card not working so well, much??
Nexxxxxxxt….
But as I said, Paul Krugman is a political rookie compared to Barack Obama. He is either unwilling or unable to actually look at the deal that was announced and realize what just happened: Barack Obama ate John Boehner‘s lunch, and then he turned Boehner out to go preach to his conservative colleagues that this eating of the lunch by Obama is actually politically good for them.
I am not kidding. Nor exaggerating. I will show you exactly how that happened if you bear with me a little bit. But first, let’s get some details of the deal out of the way so that everyone has an idea what we’re talking about.
WOW…this is going to fun, especially considering that the prevailing feeling across the political spectrum is that Obama was taken to the cleaners by Bonehead and McConnell (notwithstanding the Limbaugh/Beck/ClusterFOX line that Obama wasn’t taken to the cleaners ENOUGH).
D83 then gives the deets of the deal, which I won’t rehash since I already did so in my last post. And then, the fun begins.
He first goes after the brohaha about the “triggers”, those automatic cuts that are supposed to kick in in January of 2013 if the “Super Committee” fails to reach an agreement on cuts that can pass Congress, or if the Balanced Budget Amendment is not ratified (a vote is required, but not approval by Congress or ratification by the states). Those cuts would be equally split between defense and Medicare payments to providers, which would not touch Medicare payments to beneficiaries. Here’s D83′s analysis:
No, the loudest screeching noise you hear coming from Krugman and the ideologue Left is, of course, Medicare. Oh, no, the President is agreeing to a Medicare trigger!!! Oh noes!!! Everybody freak out right now! But let’s look at the deal again, shall we? From the White House fact sheet, here is what the President actually agreed to.
Consistent With Past Practice, Sequester Would Be Divided Equally Between Defense and Non-Defense Programs and Exempt Social Security, Medicaid, and Low-Income Programs: Consistent with the bipartisan precedents established in the 1980s and 1990s, the sequester would be divided equally between defense and non-defense program, and it would exempt Social Security, Medicaid, unemployment insurance, programs for low-income families, and civilian and military retirement. Likewise, any cuts to Medicare would be capped and limited to the provider side.
Read that again. That’s what the media and the whiners are not telling you. The President agreed to no Medicare benefit cuts in the “trigger.” None. The cuts, if they automatically happen, would go to whom? The providers. Who are these providers? Doctors, hospitals, clinics, Medical device makers, service providers, drug manufacturers. Who do you think they mostly donate to in the political season? The entire pressure on these Medicare cuts are on the private medical (and pharmaceutical) industry! So let’s ask that question again. The Medicare “trigger” is a trigger really from whom again? As a matter of fact, both big triggers (Defense and Medicare provider cuts) are triggers for the Republicans!
Of course, it would be natural for an Obamabot to use the White House press release for his analysis. Problem is, he only has HALF the story right.
Yes, the triggers would not nominally touch Medicare recipients’ benefits directly through monetary cuts…but, given the huge amount of cuts required ($1.5 T over 9 years from FY 2013 to 2021), that would amount to $750B total or $80+B a year in cuts to Medicare providers. That’s not a small chunk of change..and I’d bet ‘ya that those involved will either raise plenty hell in Congress or simply decide to just not take in Medicare recipients at all, if they’re not going to get subsidized. Fewer providers generally mean less a quality of service and more inconvenience for beneficiaries…and a greater cost to them in transportation and even services, since there will probably be more co-pays or other out-of-pocket fees tacked on for basic essential services.
In other words…very much a CUT, and potentially a pretty deep one..on top of the already steep discretionary cuts that would take effect immediately upon passage of the debt ceiling bill..the cuts that would take effect for 10 years.
The REAL bone ignorance of D83, however, lies in his complete dismissal of political dynamics. He ignores that because the TeaPublicans control the House of Representatives, they can use the regular appropriations process — you know, the process where funding for the functions of government actually take place — to extract far deeper and more death-dealing cuts to social spending than even the debt ceiling compromise offers.
Remember that the cuts are not line-item cuts to specific programs, but broad-based caps in which Congress can decide in the spending bills can determine actual spending details…and the TeaPubs, I guan-DAMN-tee you, will exploit the process directly to undercut the cap and underfund social spending programs even below the baseline…especially since they have the ultimate nuke of standing on their hands and allowing a government shutdown when the fiscal year ends on September 30th. (And, they’ll get the same hammer again next year for the FY 2013 budget, too.)
What’s to say that Prez O won’t give up the ghost and compormise away still more cuts, or simply use the “Soooper Catfood Committee” as a ruse to sell out Medicare, Medicaid, AND Social Security, in order to avoid another “Shutdown Smackdown” right in the middle of his reelection campaign?? If putting the pressure on him worked so well for the Repubs (and the Tea Partiers) before, why not go for broke and wait for him to cave again?? *cough*StimiulusPackage*cough* And again?? *cough*GitmoClosureGuantanomoTortureKSMCivilianTrial^cough* And again?? ^cough*ExtendingBushTaxCuts*cough* And again?? *cough*FinancialReformElizabethWarren*cough* And…
Finally for this segment, remember that Prez O is already ON THE RECORD of wanting to cut Social Security, Medicare, and Medicaid through “entitlement reform” via the original Simpson-Bowles Catfood Commission, which he himself organized after Congress failed to act in 2009…and that he was the one, NOT Boehner or McConnell, to initiate bringing cuts to Social Security and the other “entitlements” to the debt ceiling negotiation table as a bargaining chip. Or, perhaps D83 managed to miss that memo from the White House??
So while Krugman is correct in pointing out that the Teabaggers will hold everything and its mother hostage in order to get what they want, what they want is already being taken away from them: they will not be able to threaten the deficit reduction group with looming cuts in Social Security, or programs for the poor, civilian or military retirement, or Medicaid, or even Medicare benefits. Instead, if the Republicans do not let the deficit committee act in a manner commensurate with the President’s demand that it include tax revenue increases, they will be setting up big defense cuts and setting themselves up for dry campaign coffers on donations from the medical and pharmaceutical industries.
And oh, by the way, has Congress ever adjusted Medicare provider payments that are scheduled to decrease by law? Oh, that’s right. Congress does that every year. It’s called a Doc Fix.
See the graphs on “Government Shutdown” above. Also, because of the specific balance in the Soooper Committee (6 Dems, 6 Pubs), I’m guessing that the Pubs will be able to stand their ground against even a hint of increased revenues…unless they came with the explicit promise of revenue neutral tax reform, allowing the Bush tax cuts to extend to infinity, or repealing Obama’s prime jewel, the Affordable Care Act. In fact, I even expect that at least one of the Dems on that committee would be more than willing to cross the aisle in favor of entitlement cuts in the name of “deficit reduction”.
Moving on, please…D83 moves on to the timing of the “triggers” and the syncronization with the Bush tax cuts expiring simultaneously.
You see, these so-called “triggers” do not go into effect in 2012. They go into effect in… drumrolls… 2013. Again from the White House fact-sheet:
Enforcement mechanism established to force all parties – Republican and Democrat – to agree to balanced deficit reduction. If Committee fails, enforcement mechanism will trigger spending reductions beginning in 2013 – split 50/50 between domestic and defense spending. Enforcement protects Social Security, Medicare beneficiaries, and low-income programs from any cuts.
So the President gets the debt limit increases now, and the triggers don’t even kick in until more than a year from now. The cuts are backloaded. Why do you suppose that is? Yeah, because Congress is notorious for changing its mind when push comes to shove. Oh, and there’s this thing that’s supposed to have happened by 2013. Oh right, a presidential election will have intervened. Republicans already lost the 4th reddest district by going after Medicare. So anyone who thinks that absent something from this “supercommittee,” Congress will not actually block a big Medicare provider cut in an election year please step forward; I have a bridge in Brooklyn to sell you.
Oh, but ye of little knowledge of Tea Party extremism, dude..or how they have completely overwhelmed the Republican Party regulars. First off, they don’t really give a care about public opinion, since they are motivated by a higher voice…namely God, as interpreted by the teachings of Rush Limbaugh, R. H. Rushdoony, and Glenn Beck, financed through the coffers of Richard Mellon Scaife, Richard Viguerie, and the Koch Brothers. (The latter also fund the very DLC/Third Way thinktankers that are currently feeding Obama’s brain, too.)
Now, it is true that Congresses can change their composition, and if Democrats do in fact rally round in 2012 and oust enough TeaPartiers and Repubs to retake control of the House while retaining control of the Senate, then it’s a different game entirely. Problem is, though, has Obama’s previous actions in taking huge hot dumps on New Deal/Great Society policies and driving progressives and liberals under his well financed fleet of DLC buses so alienated and angered liberals and regular working/poor folk that they are willing to drop the middle finger at Dems come 2012?? If the deportation crisis amongst Latin@s isn’t enough to scare Obama into at least some concern other than mere spinning or blissful dismissal (because they’ll always come back due to fear of the GOTP’s racism, or so the meme goes), then what the hell will??
And let’s not forget…there is that voter suppression drive, the control of the electronic polling by Diebold, and the Citizens United-led pipeline of cash that the Right can use at their disposal to drown any liberal candidate. Only organization and/or a massive grass roots political movement can counter that…and kicking on hippies and poor folk for not praising the man who contributed to such kicking to begin with is probably not the best strategy for uniting the forces for the 2012 battle.
Try the Golden Gate Bridge, sir…it may be cheaper. If it’s not already sold to Cintra to balance the budget, that is.
Oh…did I mention those Bush tax cuts expiring in 2013??
There is another little trigger for the Republicans, but it’s technically not part of the deal. It’s a trigger to get serious about revenue increases. It’s the Bush tax cuts. And the President is ready to use his veto pen to raise taxes on the rich if Republicans prevent the committee charged with deficit reduction from seriously delving into revenue increase. From the White House:
If the Committee does not succeed in meaningful balanced deficit reduction with revenue-raising tax reform on the most well-off by the end of 2012, the President can use his veto pen to raise nearly $1 trillion from the most well-off by vetoing any extension of the Bush high income tax cuts.
In other words, do meaningful tax reform to raise revenue and take away the tax welfare state from the ultrawealthy and multinational corporations, or the highest income brackets will go up anyway. Oops.
Hip, hip, hooray!!!! We are saved!!
Except, ahhh, that the House TeaPartiers can simply attach extensions of the Bush tax cuts to any essential bill they choose, as in, any continuing resolutions that would keep the government from shutting down (and they would get two chances at that this year and next). Or…a TeaPub senator could just filibuster any bill that attempts to reach the Senate and simply gum up the works until they got the tax cuts extended. Errrr….OOPS, indeed.
And…the House members of the Sooooper Committee can simply unite and form one of Michelle Bachmann’s ‘blood pacts” that unless the President agrees to some extension of the Bush tax cuts as a part of the “tax reform” phase of deficit reduction, they will shut the Congress down totally. Besides, Obama has, once again, already provided a nice template for extending at least some of the tax cuts beyond 2013 (at least, for those making below $250,000 or $1 million, depending on the plan proposed), in exchange for some token revenue enhancers and repeal of tax deductions (such as for yachts or the home mortgage interest deduction, or simply raising the eligibility age for Medicare or increasing the income liable to taxation while flattening the tax rates).
And even in that option lays a huge trap, because the TeaPubs can simply tie legislation extending ALL of the Bush tax cuts to continuing resolutions or other legislation passing Congress, and simply double-dog dare the President to veto it and thusly throw it back against him and the Dems with “MARXIST SOCIALIST DEMOCRAT OBAMA WANTS TO INCREASE YOUR TAXES FOR MORE BIG GUVIMENT SPENDING!!!!!!” attack ads.
This isn’t to say that popular anger at the TeaPublican excessiveness couldn’t flip enough people to the Democratic side and ultimately reelect President Obama in 2012, so that he has enough slack to control the policy again. But, would people ever trust him to do that, especially since he had a supermajority of Democrats in both houses in ’08 and ’09, yet so underperformed and undewhelmed by betraying progressive policies and governing from the dead Center-Right, what’s to say that without a strong and CRITICAL (and note I capped that word, Deaniac) Left to hold him accountable, he wouldn’t steer back further to the Right??
Oh…and did I mention that the whole debt ceiling debate will have to be fought all over again in 2013, when this compromise expires?? Mercy.
Maybe by then Prez O will tire of the antics and rely on the resources that such “emoprogs” have been offering him that would have avoided all this drama, kicked the living HELL out of the TeaPubs, and armed the progressive foot soldiers in his support rather than in opposition to him. Like, say, a couple of $30 trillion platinum coins?? Or, standing down Congres and the Supreme Court and challenging the debt ceiling law under Article 4 of the 14th Amendment?? Or..actually taking a principled stand against even TOUCHING the Big 3 entitlements?? Or, even, the heresy that the real cure for our economic plight is NOT to cut down the poor and working class and shred the government, but actively USE the government as a tool for livable wage jobs and infrastructure upgrades and education??
And finally, there is this wonderful misreading of Bonehead’s political woes.
As it turns out, if you look at the details, the President essentially gave up almost nothing in the triggers. John Boehner, as usual, put himself between two triggers (three, if you count the clock ticking on the Bush tax cuts), both bad for his party. McConnell is basically trying to sell his surrender pig with a little lipstick on. And Boehner went dancing to his conservative House morons about how great this deal is for them. But then by now, we should all have learned that John Boehner is very bad at his job, and that President Obama always eats his lunch, and leaves him there holding the teabag.
Surrender to WHOM, D?? Perhaps, you have forgotten that the reason that Bonehead of Orange looks like he’s been through a wringer is because he has…except that the wringer’s being powered by the Tea Party/New Right faction of the GOTP. Remember, he had attempted to sell one of the original compromises once before…and promptly got his ass dropkicked by Bachmann, “PsychoNazi” Steve King (IA), and the rest of the “Cut, Cap, Balance” crew. That’s why he had to rewrite the bill to make it even more right-wing than ever, you see.
Incidentially….Deaniac might want to delay the confetti and cake a bit, because it’s not quite over yet. This compromise will more than likely pass the Senate, but the House is another kettle of fish. Between the absolute rage of the lib/prog Dems (led by, of course, the Progressive and Black Caucuses) over Obama’s betrayal, and the consistent opposition of the CCB/TeaParty coalition (reinforced by the ClusterFOX/Limbaugh/Beck/Palin Far Right Noise Machine) that the plan is insufficiently cruel and doesn’t link the BBA passage to the debt ceiling increase (or, simply, that it allows the increase in the first place), you have a solid 200 votes in the House against the deal. 18 more votes flip in the “no” direction, and BOOM goes the dynamite.
And, of course, we all know whom Deaniac83 will then blame for that. Probably NOT the Teabaggers. Which, says more about the real intent of this “People’s View” than anything else.
Memo, Deaniac: With stenographers like you, who needs the Progressive Policy Institute??
Update (8-17-11):
Well, well, well…looks like the dam is bursting wide open now between the Obamabots and the “Firebaggers”.
Amanda Terkel over at the Huffington Post just posted there a story on a fundraising email that was sent out by the New Mexico head of Obama For America 2012 (OFA), Ray Sandoval, on August 1st, right after the debt ceiling compromise was passed.
What mikes this email particularly interesting is that it uses as its main fundraising kick a world class beatdown on liberal/progressive critics of Prez O as “the Firebagger Lefty Blogosphere” for not falling in line behind their leader.
But the real ass kicker in all this is what Sandoval offers as the bait for the shakedown: He basically cut and pasted verbatum the very same People’s Daily blog post whacking Paul Krugman and the “Pro Left Firebaggers” for their alleged bitching and moaning about the debt ceiling compromise.
Ms. Terkel notes that this is not the first time that Obama officials have used intermediaries to smack down progressive/Left critics, noting the infamous Robert Gibbs “Professional Left” smack, the “Left of the Left” barb for those wanting a public option as part of health care reform, and the previous media attack on critics such as Glenn Greenwald, Jane Hamsher, and even Krugman.
Ms. Terkel also manages to out the author of the People’s Daily post, originally glossed as “Deaniac83″.
The rest of the email was a blog post taken from a blog called “The People’s View,” run by Spandan Chakrabarti. Chakrabarti writes that he has “been participating in online and offline liberal activism since 2003, when Gov. Howard Dean ran for president.”
A rather delicious irony, because Howard Dean back then was considered to be the “progressive” gadfly that was “too liberal” for the Presidency.
The Terkel post can be found here.
Jane Hamsher has now posted over at Firedoglake a biting rebuttal to Sandoval, which can be referenced here.
Debtpocalypse: The Final Battle…For Now (Winners And Losers)
Well…the deal seems to be finally done. Here are the details:
– $900 million increase in debt ceiling limit immediately, offset by $980M in discrestionary budget cuts over 10 years
– remaining $1.5 trillion debt ceiling release at the end of 2012, contingent upon special joint Congressional committee (“Super Congress”/Catfood Commission II”) of 10 locating and sending to Congress for approval without amendment or filibuster, at least $1.8T in additional cuts, OR passage of Balanced Budget Amendment for ratification by the states
– if “Super Committee” deadlocks and BBA is not ratified by end of 2012, then special “triggers” would activate automatically $1.2T of cuts in spending over next 9 years (FY ’13 – ’21), equally divided between Medicare distributions to providers (no beneficiaries would be cut) and defense spending. (Social Security, Medicaid, and pay for veterans, civil officials, and the military would be untouched by the “triggers”.)
– The Bush tax cuts would still expire on schedule at the end of 2012, unless the “Super Committee” deemed it be extended in exchange for revenue-neutral tax reform, or Congress and the President agreed to extend them via seperate legislation.
– The 2011 budget baseline as established by the House (aka, the “Ryan Budget Plan”) would be used as the baseline for determining the cuts. That would basically eliminate the possibility of any tax increases.
In essence, President Obama gets his extension of the debt ceiling and avoids a default; and the Republicans and conservatives get their severe budget cuts with no hint of revenue enhancements, as well as a shot at passing a BBA. Basiclaly, a slam dunk for both sides, right??
Well, not quite.
Most analysts see it as a jumbo-sized slam dunk for the Republicans and their Tea Party cohorts, because they were able to use the threat of the brink of default and economic Armageddon to literally pick President Obama and the Democrats clean, with all cuts and no revenues. They also cite the fact that Prez O essentially stiffed the House and Senate Democratic leadership (House Minority Leader Nancy Pelosi and Senate Majority Leader Harry Reid), and especially the Dem liberals, by negotiating directly with the Republican leadership (House Speaker John Boehner and Senate Minority Leader Mitch McConnell) to reach the compromise. Another important factor was the way in which Boehner used and exploited the fervent opposition of his Tea Party hard right flank as a weapon to drive the negotiations further and further rightward, while Prez O simply abandoned and rendered irrelevant the concerns of his own liberal wing.
In addition, it was noted in the post game analysis that President Obama was so intent on getting a debt ceiling compromise through Congress that satisfied his long-term objective of deficit reduction, that he ignored many weapons that he had at his disposal that would have, if he had been willing to use them, greatly strengthened his hand and his support with his liberal political base. He had the option of challenging the debt ceiling limit outright as a violation of Article 2 of the 14th Amendment, which stated that all US debt must be respected and fulfilled; or, he had the option of using coin seignoirage, which amounted to the Treasury minting a couple of platinum coins, declaring them a astronomically high value, and then swapping them out for Treasury-issue notes that could have been used to cover the debt.
The fact that he never even considered any one of those options, but was dead set on forging a compromise with the Congress — even one so tilted to the Right and dominated by people who were openly shameless in challenging his legitimacy as President, let alone as a citizen of the United States — speaks more than volumes to how dominated by Wall Street corporate conservative thought Obama has become since the Republican/Tea Party alliance took over the House in 2010. It also speaks to the continuing dominance of the “triangulation” strategy first executed by Bill Clinton during the 1990′s after Republicans took control of both houses of Congress; basically abandon the “left” and move “right” towards the ‘center” to secure the “swing voter Independents”, because the liberals, while they will whine and gnash teeth, will always come back to you because of the fear of the Republican Right winning. The fact that the “center” has been moved leagues rightward by the Tea Party so that even Ronald Reagan would probably seem liberal by comparison, makes no difference in this political strategy…it’s whatever gets the Wall Street corporate political contributions going your way.
Needless to say, the liberal side of the chamber and the Left political diaspora is now in open revolt over what they see as the final straw in a long series of caveins and surrenders of Obama to the Hard Right. Representative Elderdge Cleaver (MO), the head of the Congressional Black Caucus, attacked the final proposal as “a sugar-coated Satan sandwich”; and Independent Senator Bernard Sanders (Vermont), who has been the sole progressive voice in opposition to the entire process, lambasted the bill as “not only…immoral, but bad policy”. And long time progressive bellwether Rep. John Conyers (MI) full-blasted Prez O directly for bringing Social Security, Medicare, and Medicaid into the debate, raging that he had “had it” with the President, and called for mass protests surrounding the White House. And some intellectual figures have even started floating petitions drafting people to run against Obama in the 2012 Presidential primary…something that would have been quite unheard of in the heady days of mid-2009.
On the other hand, Obama does have his loyalists (derised by crutucs as “Obamabots”) who counter that the protests are unduly “hysterical” and that Prez O should be given a benefit of the doubt due to the extremism of the TeaPublicans and the pragmatism of having to run the office for all Americans, not just those who voted for him. The loyalists also point out that the final deal isn’t nearly as deadly as the “emoprogs” (their derisive term for the Obama critics from the Left) say or even could have been; citing the fact that the Big 3 entitlement programs generally get unscathed and that the process does allow for the Bush tax cuts to expire on schedule, and that the “Super Committee” could very well restore some revenue enhancements that would weaken the effect of the cuts. Mostly, though, the loyalists counter that “abandoning” Obama in 2012 would repeat the “folly” of 2010, where the failure of Dems to show up and vote for the midterms resulted in the Republican sweep of the House. (The Obama critics counter, naturally, that if Obama had been more of a solid progressive rather than a DLC corporate shill, they probably would have come out and supported him..and besides, most of the TeaPublican gains were at the expense of Blue Dog conservative Democrats,which they weren’t supporting anyway.)
And it’s not necessarily a cakewalk on he Right, either…there are still plenty of Tea Partiers who don’t want any bit of compromise with this President, and who want even deeper cuts in social spending and defense spending protected. Already, one GOTP Republican, Sen. Mike Lee (UT), has promised a filibuster of the proposed compromise in the Senate, citing that, in his opinion, there are too much defense and not enough social cuts in the triggers, and that there should be a requirement for passage of a BBA even before the second “tranche” of debt relief is released. And, there are still the 60 or so members of the Tea Party Caucus, led by 2012 Presidential candidate Rep. Michelle Bachmann (MN), who are steadfastly opposed to any deal that doesn’t go as far as the “Cut, Cap, and Balance” version that passed the House earlier. (One TeaPub member, Rep. Paul Broun (GA), has even proposed lowering the debt ceiling in order to induce even deeper cuts, as well as wholesale elimination of government programs and agencies.) If enough Tea Partiers team up with enough ticked off liberal Dems to vote “no”, then things could get more than a bit interesting…similar to the TARP bank bailout vote of 2007. The odds are, though, that both sides should be able to whip enough votes to pass the agreement through…and the threat of default should be enough to motivate final passage.
The bitterness of the debate, though, will outlast the final vote, as many on both the Right and the Left are angry enough for their own reasons at their respective establishments, and are chomping at the bit for electoral revenge come 2012. There will probably be primary challenges to many Repubs by some hardline Tea Party and New Right groups who want to punish those who betrayed their Maginot line of “no taxes” and “scrub the budget” (even Rep. Allen West (FL), once reveled as a Tea Party hero for his brusqueness, has come under fire and risk for a primary challenge for backing the Boehner bill and the final compromise). And on the Left, the mood is pretty ripe for not only a Presidential primary challenge to Obama, but also perhaps even a third party Independent campaign by disgruntled liberals tired of being the Democratic Party’s stepping stones.
Not to mention, the fact that the acrimony between the TeaPublicans and the Democrats/Progressives over public policy and appropriations could very much spill over and explode constantly, since the divide between the parties is so deep. There is a real threat of a government shutdown come October 1st of this year if all the appropriations bills aren’t passed and signed or a continuing resolution extending funding is not passed….and the whole circus could be repeated in 2012 for the FY 2013 budget…just in time for the elections.
And sometime in 2013, either a reelected President Obama or a new President, along with a new Congress, will have to tame the beast of a new debt ceiling battle all over again.
Interesting times we live in, folks.
#Debtpocalypse Update: Bonehead Gets Bitch-Slapped; GOTP Revert To “CCB” Line; Reid/Pelosi Awaits; Prez O Sticks With “Compromise” Meme…And Left Rages On Sideline
Well…it’s getting real close to default, and it’s getting REAL. I’ll just go straight to the highlights.
Yesterday morning, House Speaker John Boehner was full of zim and vitality as he was totally expecting the Republicans in the House to come together and send his debt ceiling plan to the Senate. “It’s a Zippity-Do-Dah Day,” he practically sang to reporters on the way to his office. His plan, for those of you not knowing, would have called for a two-tier process in raising the debt ceiling: the first installment of about $800 million taking place immediately, coinciding with nearly $1.2 trillion in spending cuts targeting discretionary programs; and the other $1.7 trillion in debt ceiling relief coming by April of next year, contingent upon Congress making pretty much that same amount of spending cuts via a joint special committee (aka, the “Super Congress” committee) that would determine the locations and degree of cuts.The bill would also call for a vote on a Balanced Budget Amendment that Republicans favor (though debt ceiling passage would not be dependent on its approval, and triggers for automatic spending cuts to take place if the “Super Committee” could not reach agreement or if their recommendations were voted down by Congress.
Apparently, Bonehead must have felt pretty good about passage, because he pulled out all the stops to get his Republican brethern to support his plan…including a private screening of the movie “The Town” including the “We are going to hurt some people” scene (the one after which Rep. Allen West, one of the few Tea Partiers to support Boehner’s proposal, volunteered to “drive the car”), and even informing some recalicant Repubs to “get your ass in like”.
At least, that was the intentions. Unfortunately for Boehner, the hardline conservatives who oppose any deal had other ideas, and they struck back hard. 25 of them, in fact, underwent the full treatment of strong-arming and persuasion by the Republican leadership, but still decided that the bill wasn’t quite conservative enough for their approval. Some cited the fact that the BBA was not mandated for passage before the second stage of debt ceiling money was released. Others cited the funding of Pell Grants – a particular goal of President Obama — that was placed in the bill in order to induce him to support it, citing the ultraright meme that any direct aid by the government to poor people amounts to undeserved “welfare” that supports laziness and criminality. Mostly, though, the bottom line of most of the conservative opposition — buttressed by right-wing celebs as Erik Erickson of RedState.com, Sean Hannity, Rush Limbaugh, and the Club For Growth/Tea Party Express conglomerate or local orgs — was that ANY agreement passed that did not include liquidating the welfare state and toppling the “Kenya socialist n—–r” from the White House would be seen as a sellout of “conservative” principles, if not treason, and would be dealt with severely with primary challenges in 2012. (Even Allen West, who was one of the loudest champions of the Tea Party, was threatened with punishment, though he stood his ground and still backed Beehner in the event.)
And to further add to Bonehead’s fristration, House Minority Leader Nancy Pelosi then announced that afternoon that every Democrat in the House would vote against the Boehner proposal, even those 5 Blue Dog conservative Dems whom had voted for the Repubs original “Cut, Cap, and Balance” proposal, which had been the mainline which Tea Partiers had supported as their “compromise”. That meant that Boehner needed to swing 23 recalicant Republicans to his favor to get the bill through the House….and on to certain death in the Democratically-controlled Senate.
Try and try as he did, sadly, Boehner fell short…and rather risk an even more embarrassing defeat, he quietly pulled his bill back to the House Rules Committee at 10 PM Washington time. That left him with two very bad choices: either moderate his proposal to match the more moderately conservative Reid bill that would be proposed in the Senate (more on that anon), or, play to the Tea Partiers and remake his bill even more reactionary to flip them over for passage, knowing well that that that bill would be DOA in the Senate, but would be a propaganda push for the Right against Prez O.
Boehmer’s choice: Option #2. Today, he resubmitted his revised bill, and totally surrendered to the Tea Partiers by not only including more cuts up front, but also adding the requirement for passage of a BBA before the second debt ceiling floater could go through…in effect, restoring the CCB mainline. That probably will flip enough Tea Party Reps to enable passage in the House, but also quickens its death in the Senate, since both Reid and Obama have said they would not support (and backed by the Prez’s veto pen) any bill that requires only a short-term debt ceiling hike and a BBA requirement. (The Senate had already killed CCB earlier in the week.)
Basically, the bottom line politically is that the hardliners who want a default that they can then exploit to their goal of eviscerating the government have won the day and control of the Republican Party…and John Boehner might not be to long for his speakership or even his seat come 2012. For them, it’s either Obama support CCB, or let loose the dogs of economic chaos. In effect, the same strategy they tried to use in California in 2007, when they exploited Cali’s 2/3rd requirement for raising taxes to create a government shutdown there in order to force their right-wing agenda down that state’s collective throats. That strategy cost them dearly politically then…we’ll see if it does the same today nationally.
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Meanwhile, on the other side of the aisle…Harry Reid decided that he just couldn’t wait anymore for the House to do its business, and announced that he would introduce his plan for debt ceiling relief to the Senate floor today. That plan is pretty much similar to the Boehner plan, but with some important differences. Unlike Boehner’s proposal, Reid provides for a single debt ceiling increase of $2.5 trillion that would last past the 2010 elections, offset by nearly $2.7 trillion in spending cuts, mostly drawdowns resulting from leaving Afghanistan and Iraq and some reforms in discretionary spending. Unlike Bonehead, Reid’s proposal does not touch the Big 3 entitlement programs (Medicare, Medicaid, Social Security). Like Bonehead, Reid would convene a “Super Congress” committee that would flesh out additional cuts and possible revenue increases that would bring down the deficit further, and would send a package to the full Congress for up-or-down approval without filibusters or amendments…but unlike Bonehead, Reid would not link their recommendations to any debt ceiling increase. This was done to get the support of more moderate Dems who want deficit reduction, but not fully at the expense of social programs, and it meets the minimum requirements of House liberal Dems, who bristle at the notion of any cuts in social spending during a recession.
Unfortunately, the Reid bill has its own issues concerning passage, too. It would have to get at least 60-Senate votes to clear cloture and avoid the inevitable filibuster from hardline GOTP Senators such as Rand Paul (KY) or David Vitter (LA) or Jim DeMint (SC)…which would mean that if all the Dems stayed put, then 6 Republicans would have to cross the line to reach cloture. (Of course, the Dems have the advantage in case of a tie of Vice-President Biden being the tie-breaking vote, in his capacity as President of the Senate.) Considering that all the GOP Senators had voted unamously for the CCB proposal, that would be a daunting task indeed.
With the stakes as high as they are, there have been movements to split the difference between the original Boehner proposal and the Reid proposal, which really aren’t that much apart procedurably (though galaxies apart politically). Senate Minority Leader Mitch McConnell (KY) has urged that perhaps the GOP would be willing to accept a long term debt ceiling increase if a mechanism could be developed to trigger automatic spending cuts if the Super Congress committee fails its mission. It’s highly doubtful whether that will get through the GOTP dominated House, though…and the thought of any cuts to social spending would lead to open revolt amongst House Dem liberals, which has promised to vote down anything of that sort. For Prez Obama, though, that would probably be considered an extra benefit in his strategy in “triangulating” liberals out of existence while appealing to the “center” as a reasonable compromiser that puts the country over party…in effect, the “adult conservative”in a room of extremist crybabies.
To that further extent, Prez O has held firm against using other means at his disposal to defuse the crisis…including invoking Article 4 of the 14th Amendment citing the requirement that “the debts and obligations of the United States….be respected” and lifting the debt ceiling unilatterally. Even after numerous Democratic leaders in the House — the latest being Minority Whip (and decisively not so liberal) Steny Hoyer (MD) and Deputy Whip James Clyburn (SC) — along with various liberal/progressive activists, calling for him to keep the “14th Amendment option” as a last resort, Obama has flatly refused to even consider it. (The threat of impeachment from the TeaPublican House, combined with a possible legal “seperation of powers” showdown in the Roberts/Scalia/Thomas Supreme Court, also tends to cool the ardor, too.) Rather, Obama appears set in his ways of reaching an agreement with Congress, even if that agreement cuts deep into his core constituencies, for the sake of deficit reduction. In all of his speeches, he has continued to emphasize the importance of getting the debt ceiling raised, the real consequences of default, and the need to bring the deficit down as a means of fiscal sanity and economic stability.
In response to that, the progressives and Dem liberals have retorted back that the debt crisis is essentially a ruse designed to cloak the massive assault on New Deal programs and spending, and the very idea of affirmative government intervention and regulation; and that most of the deficit was created and expanded through the previous administration of George W. Bush through regressive taxation, an overblown defense budget used to fund two wars off budget, and especially regressive tax cuts disproportionally benefiting the wealthy that were passed in 2003 and extended in 2010. (They are set to expire at the end of 2012; that would add neary $4.5T of revenue to the nation’s coffers, reducing the deficit nearly in half. Naturally, the TeaPublicans would love to not only extend the tax cuts to perpetuity, but expand them to remove capital gains taxes, inheritance taxes, and other such ‘burdens” to “prosperity”, shifting the tax burden exclusively to working people and the poor…hence the latest “50% of people pay no taxes” meme that has been carrying right-wing circles.)
The progressives also point out that the spending cuts would exacerbate the already weak economy at the absolute worst time in the middle of an recession, devastation both job growth and consumer confidence. Citing the experiences of Greece and their extreme belt-tightening austerity and the social protests that have exploded in its wake, they note that the cure is not to detach government, but to use the full power of government to create more jobs and repair and expand the infrastructure and upgrade the health care system.
And then, there is the other solution that the progs are steadily warming to…the coin seignoirage option that I described in my last post, whereas the Treasury simply mints a platinum coin or two, gives it a nice fat round value (say, $5-10T), and swaps them out for Treasury notes that are then used to cover the value of the debt. While more than a few have rejected the idea as highly inflationary at best and outright loony at worst, its proponents have countered that extraordinary times call for extraordinary measures, and that since the believe that the debt ceiling is fundamentally unconstitutional to begin with, why not use the full toolshed to avert financial Armageddon??
Like I said, things are getting REAL. “Tick, tick-tick-tick- tick-tick…TICK, tick-tick-tick-tick,” as Chris Berman of ESPN wold say right about now. Only, it’s not a Drew Brees two-minute drill, but the fate of our and the global economy at stake. Who will be Garrett Hartley and save the day?? We’ll just have to watch and see.
Proof Platinum Coin Seigniorage — The Ultimate Left Cure For #Debtpocalypse?
OK…now we can move on and discuss a solution to the debt crisis that doesn’t have nearly the publicity as the 14th Amendment solution, but is steadily gaining some ground amongst a few on the independent Left.
The concept is called “coin seigniorage”, and its principal founder is a progressive activist named Joe Firestone, a regular blogger at the Corrente blog under the handle “letsgetitdone”, and a regular columnist and financial analyst for the organization Campaign For America’s Future, a rump “progessive” think tank formed by liberal-to-left Dems fed up to the gills with the rightward shift of the Democratic Party for the past 20 years.
The way coin seigniorage would work would be this way:
The President would compel the US Mint to put out one platinum coin, similar to all the other coins that we all use for pocket change — except that this coin would then be given a nice HUGE monetary value. And I mean HUGE…as in the TRILLIONS of dollars. This new “SuperCoin” would then be locked up in the US Mint forever and ever; and its asset value would be exchanged with US Treasury notes created by the Federal Reserve, equal to the same asset value of the “SuperCoin”, less the value of the original material used to mint the coin. The Treasury would then use the T-notes created and monetized with the assets of the “SuperCoin” toward paying off all government debts and other obligations of the Treasury.
In effect, this “coin seigniorage” idea amounts to the Fed making up its own money to pay its debts, and to cover for any overdrafts in case its hard assets don’t match its expenses. Ta da, bang-a-bang-a-BOOM…no more debt ceiling drama. Don’t let the door knob hit your asses on the way out, Tea Partiers. Go eat your catfood and peas, Pete Peterson. And, chillax, the rest of you..we got this.
Mr. Firestone’s proposal is simply for the Fed to mint a nice fat $30 TRILLION coin made up of platinum, and use it to float enough Treasury notes to pay off not only the projected debt up to 2014, but also cover any and all appropriations by Congress for that period, and even to pay down on the actual debt. In this article, he actually describes four scenarios of varying value where coin seigniorage could be utilized as a short- and medium-term solution to the debt ceiling crisis; he favors the longer-term, $30T coin because it could cover a longer period.
The main advantage of using the coin seigniorage method is that it bypasses any need to act arbitrarily per the 14th Amendment solution, since it retains Congress’ right to regulate where the public funds are spent. Thus, it’s immune to any court challenges. Also, because the legislation is clear in allowing the President and the Fed to create bonds this way, it doesn’t need Congressional approval, nor does it require in any way even touching the debt ceiling laws.
I’ll just go ahead and allow Mr. Firestone to fill in the blanks (emphasis his):
Why not mint a $30 T coin and then another one in case the Fed gets obstreperous sometime down the road and presents the 30T coin, that was deposited in the Mint PEF account, for redemption?
I favor this fourth alternative above all, because it institutionalizes the idea that there is a distinction between appropriations, the mandate to spend particular amounts on particular goods and services, and the capability to spend the mandated accounts. In a fiat currency system, the capability always exists if the legislature provides for it under the Constitution. But the value of the 30T coin, and the profits derived from it, is that it is a concrete reminder of the Government’s continuing ability to buy whatever it needs to meet public purposes. It demonstrates very concretely that the Government cannot run out of money and that the claim that it can is not a valid reason for rejecting spending that is in accordance with the Public purpose.
So, in reading what follows, please keep in mind the distinction between the capability to spend more than government collects in taxes, and the appropriations that mandate such spending. The capability is what’s in the public purse, and it is unlimited as long as the Government doesn’t constrain itself from creating currency. With coin seigniorage its capability could be and should be publicly demonstrated by minting the $30 T coin, and getting the profits from depositing it at the Fed.
On the other hand, Congressional appropriations, not the size or contents of the purse, but whether the purse strings are open or not, determines what will be spent and what will simply sit in the purse for use at a later time. So there is a very important distinction between the purse and the purse strings. The President can legally use coin seigniorage to fill the purse, but only Congress can open the purse strings through its appropriations.
Obviously, this is a radical departure from the traditional “spend within your means” meme that deficit hawks and spendthrift conservatives live by…and the idea that the government should have the right to build the perfect money tree probably won’t thrill hard money conservatives like Ron Paul or spendthrift populist liberals like Dylan Ratigan, either. But, to people like Joe Firestone, who believe that there are unmet and woefully underfunded needs in this country that absolutely need to be done and won’t be done due to bipartisan austerity or, worse, Tea Party tightwaddedness, it’s the perfect way for the Left to do good and kill the Right and Corporate Center.
Not every progressive is as keen to the idea of “coin seigniorage”, of course. Some, like Think Progress’s Matt Yglesias, have raised the specter of hyperinflation that usually occurs when money is printed out of thin air by governments. The response by Joe Firestone follows (again, emphasis his):
First, if, as Matt recognizes, we can’t “run out of money” then why do we need people to lend us our own currency in the future? Why can’t we use coin seigniorage indefinitely for “deficit spending?” (From a technical point of view continuous use of proof platinum coin seigniorage would end deficit spending because it would close the gap between spending and taxes with miscellaneous receipts, a class of revenue. However, the gap between taxes and spending would remain and that “deficit” represents a surplus for the non-Government sector.) If we did that we’d avoid, as time went on, most spending on interest costs projected by CBO over the next 10 years. Indeed, if we project out to 15 years based on CBO 10-year numbers, we’d avoid nearly $12 Trillion in projected interest costs. Why borrow our own money back at all? The answer is we don’t need to. So, we don’t really have to care whether people want to lend us back our own money, or not.
Second, why would coin seigniorage in itself cause inflation? Coin seigniorage creates money to spend Congressional appropriations. As long as those appropriations are not so great that they exceed the potential productive capacity of our economy — and right now our output gap is around 30%, and there is no sign of Congress deciding to spend enough to close that gap — there will be no demand-pull inflation.
Would there be cost-push inflation? Not from coin seigniorage. The coins would just go into a Fed vault forever, and again the spending will be only what Congress appropriates. Coin seignorage will add to aggregate demand whenever spending exceeds taxes; but it will not cause cost-push inflation. That is caused by suppliers or speculators who are distorting markets. And the remedy for that is criminal investigations, price controls, rationing, and a thoroughgoing belief that markets must be very closely regulated by independent adversarial enforcers if they are to remain free.
Third, “money was lent in the past on the assumption that dollars would be able to purchase goods and services in the future.” But, again, why should the simple fact of using coin seigniorage debase the currency? Matt needs to explain the transmission mechanism from using seigniorage to spend Congressional appropriations and pay down debt, to currency debasement. Saying that “we also might have inflation” is easy. But one really has to show that the likelihood of inflation is greater if we use coin seigniorage than it is if we issue more debt instead. My view is good luck with that, because there are very good reasons for thinking that coin seigniorage would actually be less inflationary than issuing debt to close the gap between taxes and spending would be.
Fourth, “monetization” is a term that is frequently thrown around whenever the Government wants to use its Constitutional power to deficit spend and create money in the process. But “monetization of debt” has a strict meaning in modern economies. It refers to the purchase of debt instruments by the Central Bank from the Treasury. That wouldn’t be happening here.
Here’s how coin seignorage works: Legal tender, money, in the form of proof platinum coins, not legally viewed as debt, is being exchanged for USD credits in the US Mint’s Public Enterprise Fund account. The money goes into the Fed vaults, the USD credits go into the Mint’s account. The profits from seigniorage go into the TGA. This is an asset swap, between the Fed and the US Mint, of money in the form of a coin, for money in the form of bank reserves. Both sides of the swap are money; so there is no “monetization of debt” involved.
It should be noted that nowhere in Firestone’s work does he use coin seigniorage as a substitute for other means of progressive economic policies (progressive taxation, reducing waste and fraud in defense spending, eliminating corporate welfare, strengting Social Security and enacting “Medicare for All”/single payer health care, etc.); rather, he sees such as an accompaniment to maintaining seperation of powers and holding Congress and the President accountable for their policies.
As the saying goes: “It just might be crazy enough to work!” But, can it get enough steam to become a viable alternative? I guess that we all will just have to wait and see ourselves.
An excellent example of Joe Firestone’s method to his madness can be found in his spirited lambasting of Prez O’s Tuesday debt ceiling speech, which can be read here. (Also available here.)
Debtpocalypse, The Series: The Left Alternatives: “People’s Budget”, 14th Amendment, And…???
All righty (or lefty, as it were)..having discussed the Center and Right’s solutions to the debt ceiling brohaha, I turn now to the Left for their ideas on how to beat down this monster.
For those who have missed my previous two posts here, we essentially see the directions favored in general by the combatants. For the Right (meaning the Republican establishment and Wall Street); the solution is to simply liquidate the New Deal policies and programs of the past 80 years and unleash the supposed power of unfettered lassiez-faire “free market” capitalism unabatted by such ancient notions of government regulations and unions and anything else getting in the way of a Godly endorsed profit. For the Hard Right (meaning the Tea Party “populist” faithful and economic “nationalists” such as Ron Paul), it means that and also restructuring government back to what it was in the 1890′s…all in the name of “controlling excessive government spending”.
For the Establishment “Center” (meaning the mainstream of American multinational corporations and the neoliberals who currently lead the Democratic Party, including President Obama), it means an only slightly less astringent austerity package, but one that is “balanced” in that all of the “shared sacrifice” needed to bring down the deficit is evenly shared by the rich, the middle class, the working class, and the poor equally. (At least, somewhat equally, since the Dems are just as dependent on corporate money as the Repubs, but because they cater to a slightly less insane political electoral base, they have to appear more “liberal” than the TeaPubs in order to differentiate themselves from the latter.) Their chosen solution — the aformentioned “shared sacrifice” — combines cuts in social programs like Social Security, Medicare, Medicaid, and the rest of the social safety net with repeal of some tax breaks for corps and even some modest increase in taxes for the wealthiest citizens. (Of course, given the dynamics of political power at this time, when the Right holds plenty of the cards and the liberals are essentially a non-factor, the emphasis on cuts have won out over the tax increases, so the “centrist” package is more than a bit tilted towards the Right.)
However, while more progressive/Left solutions have not had anywhere near the publicity or public outing as the TeaPubs “Cut, Cap, and Balance” meme (now being modified and morphed into the GOP proposal put out by House Speaker John Boehner) or the “centrist” Democratic proposal put forth by Senate Minority Leader Harry Reid and House Minority Leader Nancy Pelosi, they do indeed exist and have been fleshed out in the Lefty/liberal blogosphere. And, some of them just might bear some watching.
1) House Progressive Caucus “People’s Budget”
Although the Congressional Progressive Caucus has been mostly a despised and put-off side show in this debate, they have been more than active on defending their essential line that NO social spending cuts be made to the Big 3 social programs. As part of the 2011 budget battle, they put out their own proposal for a balanced budget/deficit reduction multiyear package, labeled “The People’s Budget”, that also protects and defends social programs.
The details and specifics of the CPC proposal can be found here (warning, PDF file, needs Adobe Reader), but here’s a quick review of what it entails:
1) Allow the Bush tax cuts to expire at the end of 2012, and repeal some tax cuts for the wealthiest immediately; plus make other changes in the tax code to make it more progressive (including taxing capital gains and qualified dividends the same as earned income, indexing the Alternative Minimum Tax to inflation, adding a surtax for income above $1 million, and so on)
2) Eliminating tax subsidies/tax breaks — so called “corporate welfare” — for multinationals who exploit tax policies to export jobs overseas in order to take advantage of lower wages, and to escape domestic taxation
3) More stringent enforcement of financial regulation to avoid the kind of financial shenanigans (derivatives, junk bond speculation, et. al.) that caused the bond market collapse of 2007-2008, up to even invoking a tax on financial speculation transactions
4) Squeezing savings out of the health care/health insurance system through enactment of the “public option” model of health care reform (retaining the private insurance system, but allowing for a public exchange to directly compete for beneficiaries through lower costs and expanded coverage)
5) Decoupling Social Security and Medicare from the deficit debate by securing the solvency of the Trust Fund (mostly by lifting the cap on employer and employee income eligible for taxing through the payroll tax).
6) Protecting and expanding Medicaid (the health care program for the poor, and expanding programs like TANF (“Food Stamps”), WIC, CHIP, and other “social welfare” programs serving the poorest Americans
7) Enact cuts in defense spending through drawing down authorizations for “special emergency appropriations” (meaning the wars in Afghanistan and Iraq and the “action” ongoing in Libya), and through procurement reform
and 
Use the savings to implement a comprehensive jobs-and-infrastructure program of upgrading the physical, educational, and broadband infrastructure, reinforced through an “infrastructure bank”.
Pertaining to the immediate debt ceiling crisis, the CPC has mostly been on the side of favoring a clean debt ceiling increase, without any conditions attached; they cite the very fact that even during the profligate years of the Bush Administration, Republicans voted without any complaint to raise the debt ceiling 5 times. (Naturally, the Tea Partiers respond to that point with, “Exactly…that’s why we NEED to stop this and force the issue.”) Even none other than Ronald Reagan, the patron saint of all modern conservatives, has been recruited in the battle, with the claim that even HE raised the debt ceiling. (The Tea Party response to that: “Yeah, but he also pushed for a Balanced Budget Amendment and a line-item veto like 38 governors now have to control spending.” The line-item veto did in fact pass Congress back in 1986, but was declared unconstitutional by the US Supreme Court, citing seperation of powers and the Constitutional requirement that only Congress could set spending requirements.)
Because the CBC proposal has been mostly rejected as a way wacky “far Left” outlier by most “serious” people, the CBC liberals have been essentially reduced to the sidelines, watching in horror as Obama-Reid and Boehner-Tea Partiers go back and forth over which plan doesn’t tear them apart the most. More than likely, they will be placed in the far too familiar trap of having to support in the final resolution an agreement that kneecaps their prime constituency, or run the risks of getting blamed for the resulting default deathspell. Naturally, they are readily and mightily pissed off at Presedent Obama and the House Dem leadership for leaving them in this predicament…but in the end the thought of having to dodge both their more conservative leadership AND Karl Rove ads attacking them for causing the default, will be enough to force them into submission.
Then again, maybe not…because the populist outrage from the very beneficiaries of the Big 3 and from liberals/progressives who are getting more than fed up with being the fall guys for Obama’s center-right “triangulation” games could overcome any squeezing from the leadership…and the CBC just might show some spine and blow the whole thing up.
And, if that happens, or no agreement does indeed come to fruition before the drop-dead deadline of August 2nd, then some other solutions may come to play. Provided that the initial impacts of default don’t force a quick resolution that splits the difference between the two sides, that is.
2) The Fourteenth Amendment Solution: Screw The Congress, I’ll Do It Myself, Sayeth The President
Another solution that has emerged as a favorite of liberals and progs not wanting to genfluct to the TeaPubs or the Catfood Commission is the so called “14th Amendement” solution, whereas President Obama simply says, “The HELL with ‘ya, Congress..I am the President of these United States, and I will act on my own to insure that the debts of this country be satisfied and paid. Therefore, I hereby invoke Article 4 of the Fourteenth Amendment of the Constitution of the United States, and hereby declare the debt ceiling to be null and void. We WILL commit to our obligations, whether you like it or not.”
The foundation for this is that Article 4, which states simply that:
“The validity of the public debt of the United States, authorized by law, including debts incurred for payments of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.”
The original intention of Article 4 was to cover pensions and bounties paid in service to the Civil War (remember, the 14th Amendment was originally designed to establish citizenship for slaves and extract conditions for the ex-Confederate states for re-entry into the United States following their defeat in the Civil War), as well as to invalidate and liquidate the value of Confederate bonds issued during the war.
But wait, you say…that only applied then to that particular time, right?? How would or could that be used for today??
Funny you would ask that, Clones…because the act has indeed been referenced for a more recent Supreme Court ruling. Well, not so recent…as in 1935.
The case was a 1935 dispute, archived in the books as Perry vs. United States (294, U.S. 330), which involved a dispute involving an investor in World War I Liberty Loan gold bonds seeking payment and damages from the US Treasury for his bonds being rendered worthless by the US going off the gold standard. Congress had passed legislation rendering the bonds to be less in value than they were previously. The SCOTUS, in a 5-4 decision, ruled in favor of Perry in that Congress did not have the authority to undervalue his bond…but they also rejected his claim for damages, too.
The kicker in this?? In the extended majority ruling opinion by then Chief Justice Charles Evans Hughes, there is this nice morsel (emphasis added by me):
The fact that the United States may not be sued without its consent is a matter of procedure which does not affect the legal and binding character of its contracts. While the Congress is under no duty to provide remedies through the courts, the contractual obligation still exists, and, despite infirmities of procedure, remains binding upon the conscience of the sovereign. Lynch v. United States, supra, pp. 292 U. S. 580-582.
The Fourteenth Amendment, in its fourth section, explicitly declares: “The validity of the public debt of the United States, authorized by law, . . . shall not be questioned.” While this provision was undoubtedly inspired by the desire to put beyond question the obligations of the government issued during the Civil War, its language indicates a broader connotation. We regard it as confirmatory of a fundamental principle which applies as well to the government bonds in question, and to others duly authorized by the Congress, as to those issued before the Amendment was adopted. Nor can we perceive any reason for not considering the expression “the validity of the public debt” as embracing whatever concerns the integrity of the public obligations.
We conclude that the Joint Resolution of June 5, 1933, insofar as it attempted to override the obligation created by the bond in suit, went beyond the congressional power.
In other words, if Chief Justice Holmes is to be believed, Congress simply cannot override the obligation of an government debt.
Now, it should be said that 4 justices did dissent in that ruling…and there is still fierce debate over whether this ruling would take precedent over debts owed to foreign creditors or whether or not Congress would have any say whatsoever over the issuance of government bonds or Treasury bills. But, it would seem that it’s not necessarily an open-and-shut case that that couldn’t happen.
And then there are some real political hangups in using the 14th. Amendment bomb. The Repubs to a man have said that if Prez O goes there, they go straight to impeachment procedings. Also, there is the matter of court suits which probably will have to be resolved by the present day Supreme Court — dominated by hardline conservatives like Antonin Scalia, Samuel Alito, John Roberts, and Clarence Thomas — which would gum up the works for weeks if not months, and would still threaten to douse the financial markets during the resolution of the court battles. (Oh, and did I mention that there is also the threat of a government shutdown on October 1st, because the fiscal year appropriations billls for 2012 need to be passed and signed by then..and the deficit drama could polarize both sides even more than they are now??)
Given all that, it’s not too surprising that President Obama has consistently ruled out using the 14th Amendment solution unilaterally, instead putting his hopes on reasonable people getting their emotions under control and the moderate Repubs repudiating their Tea Party brethern and joining the Dems in passing the debt ceiling increase in time.
Problem is, the Tea Partiers have basically gotten the nose, ears, and other body parts of the Republican Party in their pockets, and they are pulling no stops in intimidating Repubs to hold the line and force Prez O to either acquiesce to their demands, or let the cards fall down. Some of the more strident Republican Tea Partiers have even downplayed the impacts of a default, while others have openly welcomed a default as a means of restructuring government in their own image.
Also, a few on the Left are equally ticked off that they would even welcome a default to get the austerity over with, rather than an agreement that simply kicks the can forward and imposes deadly cuts to poor and working folk.
Today, though, the 14th Amendment solution did get a bit more support, when some House Democratic leaders, led by South Carolina Congressman (and the #3 Dem leader in the House) James Clyburn, officially recommended that Prez O deploy the 14th bomb if the Repubs pass and bring to the President’s desk any debt ceiling bill containing only a short-term increase not going beyond the 2012 elections. (Considering that the Dem-controlled Senate had already killed the GOP’s original “Cut, Cap, and Balance” bill, and has openly said that any short-term bill would not pass the Senate as of now, the former scenario appears to be not so likely.)
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And yet, with all of this, there is yet still one more alternative that I have not discussed that is steadily coming into play amongst people on the Left…something that may still save the day without any constitutional drama or court battles, yet may blow the debt ceiling debate wide open and really obliterate the Right in one fell swoop.
And all for the cost of…one minted coin.
The hidden nuclear bomb called “coin seignoirage”…when I returneth.
Debtpocalypse Update: Reid Goes Center-Right With Prez’ Blessing; Bonehead Goes Further Right And Still Gets Stoned By TeaPubs; And The Prog/Lib Left Gets Frozen Out…AGAIN
Well, today was a busy day on Capitol Hill, DC, in the race against time to raise the debt ceiling before the Default Bewitching Hour of August 2nd…so here’s an encapsulement of what took place today, as well as the proposals that both sides are now offering.
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First, Democratic Majority Leader Harry Reid (Nevada) finalized and released to the press his proposal for ending the crisis. Pretty much based on a proposal that House Minority Leader Nancy Pelosi had originally created, it would essentially give a one-time raise of the debt ceiling by $2.5 trillion, enough to last past the 2012 elections…thusly freeing President Obama of any harsh votes to raise the ceiling during election season. In exchange, Reid would accompany the debt increase with a spending cut package of $2.7 trillion, with no revenue increases included. While most of the details of the specific cuts were not specified, it appeared that most of the cuts would come from savings in drawbacks due to the removal of troops from Afghanistan and Iraq, or reforms in the Fannie Mae and Freddie Mac home loan programs, and in some minor changes in the way health providers would be paid out in the Social Security and Medicare programs. However, no cuts would be imposed on the benficiearies of SS/Medicare/Medicaid, which would not only smooth the feathers of ruffled liberal Dems who were in revolt that Prez O would even consider tapping into these programs for cuts, but make it easier for Dems in Congress to support the proposals even if it violated their previous stance that any deficit reduction package had to have some revenues included.
In addition, in order to sweeten the deal a bit, Reid added this afternoon a kicker for future deficit reduction and/or tax reform: a twelve member commission made of pf reps from both houses of Congress and equally divided from both parties would be convened to flesh out a package of additional budget cuts, revenue enhancers, and even do some tax reforms, that furthered deficit reduction. This “Super Congress” committee would then send its findings and recommendations in the form of legislation to both full houses of Congress for approval or denial on a straight up-or-down vote, with no amendments or filibusters allowed. In effect, Reid’s proposal would be a supercharged version of Prez O’s original commission headed by Erskine Bowles and Alan Simpson (maligned by liberals as the “Catfood Commission”) which was originally formed in 2009 to search for “entitlement savings” in Social Security in the name of deficit reduction and tax reform.
Essentialy, the Reid-Pelosi plan (now officially endorsed by Prez O) represents the “centrist” or “center-right” view of raising the debt ceiling while avoiding as much political damage to establishment Democrats or President Obama as possible from the center, while also sweetly buying off progressives with the promise to not touch entitlements for now (though also with enough cover via the “Super Congress”/”Catfood Commission II” to make such cuts in the future in order to please investors and Big Finance.
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On the other side of the political fence, you have House Speaker John Boehner (aka, “Bonehead”), leader (for now) of the House Republicans, attempting to straddle the even more intense and super electrified line between his Wall Street benefactors’ demand that the default be avoided at all cost, and his Titanium Right backbenchers in the House and Senate, and especially the Tea Party Caucus and the traditional New Right activist groups, who would more prefer the entire process shut down and default occur so that they can gain political hay to toss at President Obama for the next political cycle, and also to enact their never-ending vision to, using Grover Norquist’s classic words, “redice big government to the size that it can be drowned in a bathtub.” (This does NOT include the actual Tea Party groups, who simply don’t want ANY deal and who believe that Bonehead is simply a traitor and an RINO (Republican In Name Only) for even suggesting a deal be cut with someone they consider to be nothing less than “that Kenyan socialist half-nigger” who got in power only because of ACORN, college Marxists, gangsta Blacks, illegal aliens, and rectum-loving gays.)
Anyways, Boehner’s proposal for defusing the crisis is somewhat similar to the Reid-Pelosi plan, but with a few major exceptions.
Like Reid-Pelosi, Bonehead would allow for an immediate raise in the debt ceiling, though only a $1.5T short-term increase that would only go until around August of next year. That’s because he would require a second debt ceiling increase to be passed then, predicated on some conditions that there be real cuts with no revenues, at least an additional $2-2.5T in cuts. Like Reid-Pelosi, Bonehead’s proposal would convene a “Super Congress” to levy out what the cuts would be…but unlike the former proposal, those cuts would be mandated and would have to be enacted before any further debt increase could be enacted.
Now, before we continue, it should be noted that Boehner’s proposal isn’t even the baseline proposal favored by the GOTP faithful; they prefer much more the “Cut, Cap, and Balance” approach, which is the bill that passed the House of Representatives but was defeated in the Dem-controlled Senate. Basically, CCB would predicate any increase in the debt ceiling to a stringent program of severe budget cutting and government slashing; including a direct cap on any spending on a yearly basis equal to 18% of Gross Domestic Profit (which would effectively reduce spending to 1966 levels), and require passage AND enactment of a Balanced Budget Amendment which would force even more massive cuts as a means of keeping government “balanced”. (Many states have BBA’s in effect as a means of controlling budgets, but running a nation of 380+ MILLION people is another matter.)
Unfortunately for Bonehead, his attempts to sell his plan to the GOTP have fallen flat on their faces, for all the aformentioned reasons. The Tea Party faithful simply don’t trust anything that gives Prez O even a smidget of credit; they don’t trust the idea of giving anyone else, especially a “Super Congress” elite, any power over what gets cut and how much; and they really, really want to see REAL cuts that cause real pain to those that they despise and hate…especially those “socialist” Dems and their “parasite” constituents who apparently suck the blood off of the thrifty, God-loving entepreneurs and able-bodied hard-working (White) Americans only looking for their right to become filthy rich and live off the blood, sweat, and tears, and broken backs of other peoples’ labor. Even adding things like the caps on spending and the insistence of voting on a BBA (which, of course, still requires a 2/3 vote in both houses of Congress and ratification by 37 out of 50 states) was not enough to sway even a bit the Tea Partiers to support his efforts.
It seems now that both sides will now dig in their heels in support of their respective plans: Prez O and the Democrats for Reid-Pelosi; Bonehead, Cantor, and the rest of the GOP leadership for CCB. (Dueling addresses by both the Prez and Boehner are scheduled for tonight.) Obviously, the Tea Partiers, reinforced by the usual right-wing butresses like FOX News and Rush Limbaugh, are simply watching from afar, waiting for the inevitable default to occur so that they can exploit the detrimus from the damage.
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And all through this, the lowly Left — progressive Dems and liberals alike, as well as everyone dependent on Social Security or Medicare or Medicaid or any honest progressive social program — can only look in shock and horror as this tactic of “Shock Doctrine” unravels everything that they have built and defended for the past 70 years. While the bulk of liberal-left rage is directed rightfully towards the Tea Partiers and the Republican Right, there is also a rising hue of anger and venom being directed at President Obama and the establishment Democrats as well from liberal/progressive activists, directly citing his willingness to give away at the tip of the hat core New Deal commitments and programs for peanuts..or simply to burnish his reputation as a “centrist” and compromiser who battles the “extremists of Left and Right” to reach a doable “middle” for all. That, combined with Prez O’s betrayal of his campaign promises as a “liberal” in enacting policies mirroring, if not even leapfrogging to the RIGHT of, the policies of Republican predecessor George W. Bush on varied domestic and foreign policies, have enraged many to the point of unprintable insults heaved at Obama and, to a lesser but just as increasing extent, the Democratic Party as well.
The main thesis of the Left-liberal anger is that Obama could have pursued and still could pursue other means of defusing the debt crisis without tapping into the Big 3 entitlement programs. For instance, simply allowing all of the tax cuts enacted by the Bush Administration to expire at the end of last year would have gained nearly $4T in new revenue ALONE..enough to cover the debt ceiling for the next 5 years. Indeed, they cite the fact that during Dubya’s reign, the debt ceiling was raised 13 times by mostly Republican-led Congresses without even a pittance of opposition, even when Dubya was running three wars off budget, passed a profligate partial privatization scheme (Medicare Advantage/Medicare Part D), and was piling up nearly $5T deficits as far as the eyes could see, even reversing what was a nearly $200B surplus achieved during the administration of Bill Clinton. (Of course, the Tea Party Right uses those same figures to justify their opposition to Bush’s spending spree…but they’r more motivated by smashing government per se, especially government not bound by right-wing Dominionist/Social Darwinist/Ayn Randian principles.)
The progressives also respond that Social Security and Medicare, being self funded by employer and employee taxes, have NO place being involved in any deficit reduction or debt ceiling debate whatsoever, that cutting spending and reducing government’s ability to react to economic conditions in the depths of a recession is the height of folly and a recipe for economic disaster, and that it is simply mean and cruel and fundamentally unfair to target poor, elderly, and working class folk for “shared sacrifice” while the wealthy and the corporate business class get off scot free with their tax subsidies and wealth untouched, if not even expanded off the backs of the underprivileged. Plus, if you want to really bring down the deficit, there’s always the bloated defense budget, the many tax subsidies and credits literaly thrown at Big Biz to create jobs overseas at the expense of American workers, and the high costs of health care due to price gouging by Big Insura and Big Pharma…which a public option or single payer health care system would instantly cure at a huge savings.
Alas, it seems that the progressive voice has been all but shouted down from the debate even within the Democratic Party, due to the full financial heft of corporate fundraising, the all-too-successful attacks on organized labor and liberal interest groups representing workers and the poor, and the dominance of the establishment media of corporatist and neoliberal, if not neoconservative – propaganda through such outlets as the Democratic Leadership Council (DLC) and Third Way. The latter orgs were created by mostly center-right Dems in the 1980′s as a means of transforming the Dems away from their “dependence” on the old New Deal/liberal/labor alliance and repackaging the party towards a more corporate-military-industrial-friendly image…mostly, to tap into corporate money. Bill and Hillary Clinton as well as Barack Obama were highly influenced by DLC/Third Way thought, while they did retain some bit of liberal rhetoric as a means of keeping libs/progs at bay. Their mastery of “triangulation” — keeping liberals at arms length and even attacking them publicly when they make demands of accountability, while using the threat of the TeaPublicans to bind them permanently to the ever rightward moving Dem political coalition — while attempting to always pander to the supposed “independent swing voters” who occupy the vaunted and prized “center’ — worked pretty well while Bill Clinton orchestrated an economic boom. Problem is, when Obama swept to office on the wave of revulsion at Dubya’s policies and the symbolism of “Hope and Change We Can Believe In” and “Yes, We CAN!!”, most people expected him to reverse the policies of Bush and transform the Dems back to the tradition of liberalism, not become a token of Wall Street and the Pentagon.
Naturally, Prez O still has his defenders who insist that progressives should have known that he was in reality a centrist only playing a liberal to get elected, or that he is a legit prog who’s simply playing the “centrist” due to having to deal with those “obstructionist” Republicans and the hyperbolic Tea Partiers, and any criticism of him is counterproductive and plays right into the TeaPub’s reactionary agenda. Also, there are the PUMA (Party Unity, My Ass) crowd who still hold major grudges against Obama for denying Hillary Clinton her crown jewel of becoming the first woman POTUS, and who are now crowing with glee about how they saw Prez O for the heathen he was all along. (Right..as if Hillary would have been any better in Obama’s place.
All the personal smack directed at Prez O, however, is for me a convenient smokescreem to mask what I feel to be a far more fundamental issue: the ability of the Democratic Party, if not the American political/economic system as a whole, to directly confront issues of fundamental economic equality and social equity and democracy itself. Choosing between “bipartisan” (now becoming more Democratic) conservatism and New Right/Tea Party fascism is probably NOT what FDR or JFK had in mind when they steered the Democratic Party away from an earlier corporatism under their own threat of outright fascism (and also to deflect the appeal of socialism/communism). If the Left wants to remain relevant, if not survive, this ensuing right-wing offensive, they need to make some rapid and distinct changes in their outlook and their organization and their objectives.
I did promise you my idea of a possible alternative program for an Independent Left alternative…and I still plan on keeping that promise. That will be my next post.
Debt Ceiling Death Match: Whereas One Side Plays Chicken With America’s Money; And The Other Side Is Too Chicken To Respond
It would be pretty damn funny watching the incoming multi-train wreck known as the Great Debt Ceiling Smackdown reach its epic climatic meltdown.
It would be…except for the fact that it’s only America’s and the world’s economic future at stake.
For those of you not following, here’s the Cliff’s Notes version of what’s going on:
The “debt ceiling” is the limit to which our US Treasury can insure that they can pay our government’s collective bills…you know, all those bonds and T-bills they create to pay off our creditors.
When we approach the point where our spending levels surpass our revenue, then we are officially at debt, which means that we either have to raise revenue (mostly through taxes), cut spending (usually through slashing government programs), or we simply raise the debt ceiling to allow for the government to continue on its merry path.
Traditionally, our government, whether ruled by Republicans or Democrats, neoliberals or neoconservatives, have simply chosen to just raise the debt ceiling and call it a year.
They can do that because, unlike regular households, who are limited to what money they earn, the Federal Government, through the Treasury, has the flexibility to print more money and float more bonds to keep everything running even with a deficit. Normally, that wouldn’t be questioned, and hasn’t been for the past 220+ years of our government.
This year, however, a new breed of hardline right-wingers known collectively as the “Tea Party”, was able to use a combination of Wall Street muscle, tons of cash, and angst about the election of the first person of color to the office of President of the United States to take control of the Republican Party, and also launch them to control the House of Representatives.
Their basic belief is that the debt is caused by waaaaaaay too much government spending and waaaaaay too much taxes, and waaaaaaaaaaaaaaay toooooo much government regulation….especially of those wealthy folk whom they see as the “engines” of capitalism. If we would only get rid of the evil secular welfare state and all those “job-killing” regulations and worker protections like the minimum wage or unions or reproductive freedom for women or laws against child labor and such, and would just rely on the good old “private sector” for generating economic growth, then permanent prosperity would reign proud and free..or so goes their argument.
Basically, they want to reset America back to the glory days of the 1920′s, where Social Darwinism and fundamentalist Christianity and unfettered capitalism ruled the roost.
Of course, the Reaganites/Tea Partiers aren’t all opposed to all government spending or government programs..since they have no problems funding poorhouses, orphanages, or prisons to house the refuse population that is a byproduct of throwing poor people to the streets to fend for themselves, nor do they have much opposition to the sprawling budget for the Pentagon to conduct endless wars and oppress the enemies of America (defined mostly as Muslims, gays, feminists, and anyone of color not with as much wealth as Herman Cain or Allen West or Michelle Malkin or Mario Rubio. It’s just the spending for those “parasites” and “losers” who suck the blood off of “their money” and those damned “bureaucrats” who get in the way of their unalienable right to exploit the earth and other people for maximum profit, that they wish to “control”.
To that end, the now consolidated GOTP has decided to make its stand around what was previously seen as a sure thing: raising the debt ceiling. Mostly, by holding it (and the American economy) hostage. The deal: NO debt ceiling increase this time unless we get REAL reductions in “big government” spending; real privatization of government assets, and the total and complete abolishment of all social spending programs not supporting our goal of “self reliance” and “independence from government dependency”.
Since the TeaKKKluxers happen to control the House, they have the means to push their harsh demands…but since they don’t control the Senate and the Presidency (The Democratic Party and Barack Obama control those, respectively), they can’t fully impose their Ayn Rand/Jerry Falwell society. Therefore, this game of chicken they’ve created.
On the other side of this “smackdown” are President Obama and the establishment Democrats, buttressed by much of the heft of Wall Street, who quite naturally, are stunned at the belief that the TeaPubs would play this game. “Do you understand the consequences of what would happen if America defaults on her debt??” they counter the TeaPubs. “You do know that a default would throw the US (if not the world economy) into a bottomless tailspin and transform us into just one step above Somalia, right?? Not to mention, you would basically destroy programs that most Americans rely on to survive in the midst of a recession, simply to satisfy your ideology?? Come on now…what’s up with that??”
Now, it’s not as if the President has no skin in the deficit reduction game, either. Obama has been bending himself backwards trying to negotiate with the Repubs trying to get a deal that would raise the debt ceiling while promoting his own goals of deficit reduction, tax reform, and “entitlement reform”.
Problem is, he is so obsessed with getting a deal that he’s been willing to trade away to the GOTP plenty of the guts of the social programs that his party developed and have sustained for the past 60 years. As part of the offensive engineered by the Bowles-Simpson Commission on Deficit Reform (known and hated by progressives and liberals as the “Catfood Commission”, due to the fear that their cuts to Social Security would abount to reducing poor elderly folks to cat food for subsistence), Obama has pushed, though not nearly to the extent of the GOTP) moderate cuts in social programs such as Social Security, Medicare, Medicaid, and others, as a means of “balancing” his insistence that any debt ceiling bill also include “revenue enhancements” from the wealthiest Americans. “Shared sacrifice” is what Prez O calls it; and it lies at the heart of the “centrist” approach to governance that establishment Dems have abided to ever since the Democratic Leadership Council (DLC) and Third Way was founded to move the Dems further rightward from “New Deal liberalism”.
Obviously, the people who would be most affected by the cuts in social programs, as well as the progressives and liberals who were under the pretension that they had elected a liberal Democrat in 2008 rather than a Reagan/Gingrich clone, are very much up in arms over Obama’s “negotiation skills”. For them, this “negotiation” away of their livelihoods is the last straw in what they see as nothing less than a Manchurian conspiracy, if not an outright kneecaping, of the Democratic “base” that helped put Obama in office. In addition, plenty of liberal economists have raised lots of hell over the notion of cutting essential government services and social programs in the midst of a recession would do nothing to enhance economic growth, that Social Security and Medicare have no business being part of any deficit reduction or debt ceiling negotiation because the former are self-funded by worker payroll taxes and totally unrelated to the deficit; and that maybe the real cause of these rising deficits might have more to do with the runaway deficits of the preceding administration of George H. W. Bush (aka Dubya), which relied on the very same profligate tax cutting and off-budget war games financing and deregulation that the TeaPubs love to promote as “prosperity”. Allow Dubya’s tax cuts to expire, they say, and the deficit problem is mostly solved, and without thrashing working folk or the poor or the elderly.
Of course, the response of the TeaPubs to this amounts to: “Shut up, you Marxist socialist big government commies!! We have a SPENDING problem here, caused by illegal aliens and butt-fucking gays and Godless atheists and gangsta niggas paid by ACORN and welfare queens and big union bosses and slutty women using Planned Parenthood to abort their unborn babies….stealing OUR wealth to support their evil unGodly lifestyles…and all those other goddamn parasites living off OUR God-given taxpayer money and property!! Give us back our fucking money, libtards, and let us spend it the way WE want to…and let God, the prison system, and my machine gun sort the rest of you out!!!”
The fact that the TeaPublicans would throw the label of “Marxist” and “Commie” at a pro-Wall Street deficit hawk President whom has essentially governed just slightly to the RIGHT of Dubya on foreign policy affairs (his recent turn towards repealing the “Don’t Ask, Don’t Tell” policy of excluding gays and lesbians from the military aside), and has basically embraced economic policies that Newt Gingrich would call as ‘reactionary”, tells all you need to know about their political outlook. Also, they would no more give Prez O credit for anything, even if he endorsed 99.999% of their policies then they would give Jesse Jackson credit for his social conservatism. To them, you are either with ‘em to the fullest, or you are the “socialist” enemy..and if you fall in the middle of their road, that makes you a “socialist” to be rolled over.
Either way, the reason why this all matters is that the Treasury has established the date of August 2nd as the drop dead date in which the US officially goes into default, when the government is officially unable to pay its debts and can no longer meet its commitments. After that date, things like Social Security checks, payments to our military, and even whole government offices would be shut down totally, and the worthiness of US backed bonds and Treasury bills would plummet to the ground. Considering that the US has been established as the world standard for safe investment in bonds and credit, that would probably not have a good effect on the world economy….especially considering what is currently going on in countries like Greece, which is experiencing its own debit crisis and severely imposing their own brand of “shock therapy” on its citizens. (And in Greece, said citizens are responding not with town hall meetings, but direct violent confrontations with the authorities. Not a pretty sight.)
That thought of #Debtcopalypse has doubled the efforts of Wall Street and government officials to seek compromises that would defuse the potential economic nuclear bomb by striking a middle ground between the mainstream Repub view of spending cuts and the Obama/mainstream views that some revenue enhancements need to be raised to balance the cuts. Whatever form this compromise would be, of course, is the devil in the details; with various mixtures of “discretionary cuts” and minor “revenue enhancements” being proposed.
The program that looked the most probable (at least, until yesterday evening) was a plan that was negotiated by Prez O along with House Speaker John “Bonehead” Boehmer, which would have called for roughly $2.5 trillion in cuts ($1.5 in discresionary spending combined with $850 billion in cuts to the Big 3 social programs, delivered through means testing Medicare and changing the formula for determining Social Security benefits via cost of living adjustments (COLA’s), as well as raising the age of eligibility for receiving Medicare); but would also include some form of “revenue enhancements” through repealing some tax subsidies for some wealthy folk…and a promise of some form of tax reform down the road. Another variation would offer less cuts (around $1.5B) but would include incentives to do serious deficit reduction and tax reform through “triggers” that would force stringent budget cuts AND some tax increases, including repeal of the Bush tax cuts on schedule.
Unfortunately, that was too much for Senate and House Democrats, who essentially gave the plan the proverbial boot because it violated their insistence for genuine revenues, it blew up the Big # social programs, and it would put Dems in the position of being the political fall guys for either voting to shred their own progressive legacy (and being whacked by GOTP attack ads for “cutting Medicare and Social Security”); or having voted against the debt ceiling (and being attacked by other GOTP attack ads for “reckless spending” and “sending the country into default”) For Obama and Wall Street, though, that could be overrun by the real dangers of default..and besides, the “base’ is considered to be not nearly as important, since the fear of the GOTP will keep them allied to the Dems regardless..or so the political logic of the DLC Dems hope.
All that is a moot point, though..because yesterday evening, Bonehead, deferring to his TeaPub “no compromise” flank, broke off from negotiations with Prez O, citing the latter’s insistence in “tax increases” (read: allowing the Bush tax cuts to expire) rather than spending cuts and “entitlement reform” (i.e., shredding the welfare state). Also, Boehner had attempted to attach another booby trap to the proposal which would add a new ‘trigger” if no agreement would be reached: the repeal of Obama’s crown jewel legislation, the Affordable Care Act (also known to disgruntled progressives as the Obama/Baucus/Romney Big Insura Bailout And Forced Private Mandate Act).
In its place. Bonehead offered up the only alternative backed by the TeaPubs in the House: the “Cut, Cap, and Balance” bill that would precondition any increase in the debt ceiling on three factors:
1) stringent and long lasting social spending cuts, totaling as much as $5 TRILLION over 10 years;
2) a commitment to regressive “revenue-neutral” tax reform that exchanged permanent extensions and expansion of the Bush tax cuts and repeal of capital gains and inheritance taxes with even more regressive taxes targeting the poorest Americans (in effect, moving toward the “flat tax” and “fee dependenct” system that rightists have wanted for years);
3) a permanent “cap” on government spending of 18% of Gross Domestic Product, with any and ALL government expenditures counting against that cap (but “revenue” from tax cuts not counted, in deference to the “supply-side” theory that tax cuts bring in revenue;
and 3) the passage of a Balanced Budget Amendment to the US Constitution that would require a balanced budget every year, thusly kneecapping the ability of government to spend on social needs.
Of course, defense spending and tax subsidies for the wealthy would be totally exempt from the caps, making the full weight of the hammer fall on social spending and “socialist” government regulation.
The “Cut, Cap, and Balance” bill did pass the TeaPub-controlled House, but got derailed in the Dem-controlled Senate by 4 votes; and Prez O has promised a veto just in case it does pass the Senate. Nevertheless, some TeaPub Senators still have the myopic idea that they can flip four Dem senators to pass CCB and force a veto, which they would then use to enflame the Tea Party locals and flail the Dems with in 2010. Good luck on that.
Meanwhile…a very, very, VERY pissed off President Obama wailed away at the obstructionism of the TeaPubs, and called for an emergency meeting with all the House and Senate leaders (that would be Bonehead, Nancy Pelosi (Dem House leader); Harry Reid (Senate Majority Leader, Dem) and Mitch McConnell (Senate Minority Leader, Rep) to get to the bottom of this and get the debt ceiling fracus resolved.
And, that’s where we stand as of today. Closer to Debtcopalyse, with not much sign of resolution in sight, with both sides digging in for the inevitable clash.
Essentially, this is a confrontation between the Center-Right Democrats and the Hardcore Ultraviolet Right TeaPublicans on who gets to smash a significant portion — or ALL — of the social safety net in the name of either “deficit reduction” or “restoring prosperity”.
Or, to put it a different way, it’s a choice of whether poor and working folk will ultimately be forced on a “peas and cat food” diet, or simply are starved to death/
And…it’s a choice that is simply unnecessary and shortsighted. An alternative vision and platform actually does exist to this mess.
But…that’s for Part 2 of this essay…stay tuned.