Sunday, November 9, 2014

2014 Midterm Election Post-Mortem: What's Next?

Now that the votes have been counted, the tears have been shed, the champagne has been consumed, and the unemployment insurance claims filed it is time to consider what the results mean for government and governing in America over the next two years.  I'll start with a look at the House of Representatives, the Senate, and then the executive branch.

The House of Representatives

As of November 9th the GOP controls 244 seats in the House to 184 for the Democrats with seven races still undecided.  A quick look at the NY Times big board indicates that the GOP is likely to capture five of those undecided seats.  That will put them right around 250 seats, their largest caucus since Herbert Hoover was president.  Archie Bunker would be proud.  Does the increased majority make it more likely the House GOP starts governing again?  I think it does and here's why:

John Boehner and Kevin McCarthy, the Speaker and Majority Leader in the House, are for the most part moderate establishment politicians.  They're not obstructionists like some of their fellow bomb-throwing extremists who demanded a shut down of the federal government in 2013 and threatened to allow the nation to default on its sovereign debt.  Boehner and McCarthy are conservatives without a doubt but they are conservatives who want to see Washington work efficiently.  Sure, they live in a fictional bubble where smaller government is possible and Big Bird loses his head but, hey, you have to dream big in order to keep waking up every day, right?

Seriously, the larger majority in the House for Boehner allows him to do something he has not been able to do since being elected Speaker in 2010...tell the Tea Party to take a hike and get with the program or become irrelevant.  The question is whether he will do it or not.  My bet is he will and we will see a much more productive House in 2015 and 2016.  We might even see some major legislation emerge such as immigration reform and tax reform.  To be sure, it will reflect Republican priorities so Boehner and McCarthy will have to do some negotiating with the president if they want it to become law.  I think they'll find a way to get it done.  The alternative is to go into the 2016 presidential election as the party that controlled Congress for two years and did nothing.  Given the different electorate we are likely to see in 2016 I do not think that is a very good strategy.  I suspect Boehner and McCarthy would agree with that assessment.  Had the Republican House such a majority in 2014 I suspect the bipartisan immigration reform bill passed by the Senate would have been brought to the floor of the House and passed with bipartisan support and then signed into law by President Obama.

The Senate

It appears right now the GOP will net nine seats in the Senate, which will put them at 54.  That's not enough to end a filibuster if a the Democratic minority decides to play the obstructionism card the way the GOP did for the past four years.   There are a core group of institutionalists within the minority that will prevent obstruction from becoming the norm for the next two years.  Further, the Democrats have nothing to lose and everything to gain by working with newly minted Senate Majority Leader Mitch McConnell to find areas of common ground to move policy forward.  They likely will not get everything they want but history shows that Democrats have been much more willing to compromise in order to govern than the GOP has in recent years.  As of now, I see no evidence to indicate that will change in the 114th Congress.  The wild card is Harry Reid, the presumptive minority leader.  Reid has the potential to make life hell for the GOP if he wants to.  I wouldn't blame him if he did after what he has been through for the last four years but eventually the time comes to stop playing tit for tat and acting like a grown up.  Perhaps both McConnell and Reid will realize that the time has arrived.  Otherwise they both ought to retire to some Kentucky stud farm.

Taking control of the Senate also means that Republicans can no longer point fingers at the Democrats for failing to pass a budget, ignoring the minority, and all the other ills that Harry Reid has been accused of passing on to the country.  The GOP will have to stand or fall in 2016 based upon its own performance.  America has given the party a chance to prove it can govern.  Govern it must or 2016 will see a return of a Democratic Senate, though the odds are somewhat longer of that happening if the GOP does indeed have 54 seats.  Donkeys would need to net four seats and the presidency in 2016 or five seats if the GOP wins the presidency.

The President

In some ways, losing control of Congress has got to be a relief for the president.  He is now free to work with Republicans without regard to what Harry Reid or Nancy Pelosi wants.  The major players for the president now become John Boehner and Mitch McConnell.  Sure, that doesn't mean they'll sit around holding hands, sipping Kentucky Bourbon, and singing Kumbaya.  But it does mean the president has an incentive to accomplish some things over his final two years in office.  If the president is wise he will employ the triangulation strategy that worked so well for Bill Clinton.  In essence, President Obama will attempt to co-opt some of the Republicans priorities in the next Congress, which allows him to get the credit when they enact what is essentially their agenda.  Such a strategy only goes so far, however.  It is unlikely the president will give on his core principles, which is sure to setup a showdown with the new Republican Congress.

Moving Forward

The takeover of the Senate by Republicans may well be a blessing in disguise for the president and the Democratic Party.  As I said, if the GOP fails to govern for the next two years it benefits the Democrats in 2016.  Using a spatial analysis approach, what matters most over the next two years are the pivot points for the major players.  Pivot points reflect the optimal position of the 218th member of the House, the 51st (or 60th) vote in the Senate, and the preferred position of the president.  The larger majority in the House may mean the 218th vote position has moved slightly right or slightly left from where it was in 2013-14.  If it has moved to the right (due to greater Tea Party strength) then the next two years will be an exercise in brutal futility as there will be little ground for compromise.  If the pivot point for the 218th member of the House has moved slightly left (due to greater moderate strength among new members) then there may be more room for deals to be struck with the Senate and president.

The pivot points in the Senate have shifted significantly to the right with the GOP taking control.  The 51st vote now rests with the 4th least conservative Republican as opposed to the 4th least liberal Democrat.  That means John McCain or Lisa Murkowski is likely to hold the 51st vote on items that can be passed on a simple majority vote.  If 60 votes are required due to a Democratic filibuster (or threat thereof) the 60th vote will likely come from Jeanne Shaheen or Michael Bennet (40th most liberal).

The president's pivot point is likely to also shift rightward.  Despite the rhetoric of many conservative Republicans many of President Obama's actual policies have been quite conservative from the tax cuts implemented in 2009-2011 to the transfer of wealth from individual citizens to big insurance companies under the ACA, which was modeled on a plan first proposed by the conservative Heritage Foundation.  Since Obama has shown little hesitancy to move to the right when a deal could be struck with the House leadership I expect him to continue to do the same in 2015-16.  Only now the deals will be between Obama, Boehner, and McConnell.  If Boehner and McConnell can reach agreement then the president is likely to come along unless it involves a gutting of Obamacare or any of his other signature accomplishments.  The most likely major agreements are on immigration reform and tax reform in the next two years.  There will also likely be some tweaks to Obamacare but unless the Supreme Court declares it unconstitutional it is here to stay.

Wednesday, November 5, 2014

2014 Midterm Election Post-Mortem

November 4th has come and gone and like with any natural disaster the time for picking up the pieces begins with the light of day, at least for the Democrats.  The Republicans, on the other hand, will likely be hung over from their victory parties for a few days to come.  Regardless, the questions are what happened, why, and what does it mean for the country for the next two years?

What Happened: The Electorate

Simply put, it was a bloodbath for the donkey party.  The elephants drowned the donkeys in a sea of red in virtually every winnable race.  From the House to the Senate to gubernatorial races there wasn't much good news for the donkeys up and down the map.  Of course, there was nothing really surprising about that because the party controlling the presidency has lost seats in 18 of the last 21 midterm elections.  There are a variety of reasons for that but James Campbell's explanation seems to be the most accurate.  Campbell attributes the midterm loss phenomena to the fact that there are two electorates in the United States, one that shows up for presidential elections and one that shows up for midterm elections.  Some voters are in both of these electorates but the electorate for a midterm differs demographically from that of the presidential election in a couple of significant ways.

First, the electorate during a midterm election tends to be older than that of a presidential election.  According to the exit polls, 22% of the electorate was 65 years or older.  In 2012 that number was 16%.  Those over age 65 currently tend to vote Republican (56% in 2012, 57% in 2014).  Voters between 18 and 29 years of age made up only 13% of the electorate in 2014.  Two years earlier they comprised 19% of the electorate.  In 2012 younger voters split 60-37 for the Democrats while in 2014 they split 54-43 for the Democrats.  The six percentage point increase in senior voters was enough to seal the fate of Democrats in many close races.

Second, the electorate in 2014 was whiter than in 2012.  In 2012 whites made up 72% of the electorate and 59% of those voted Republican.  In 2014, whites comprised 75% of the electorate and Republicans carried 60% of that vote.  African-Americans were 13% of the electorate in 2012 and slipped to 12% in 2014.  They voted 93% to 6% Democrat in 2012 but 89% to 10% Democrat in 2014.  Latinos consisted of 10% of the electorate in 2012 and supported Democrats by a 71-29 margin while in 2014 they were 8% of the electorate and voted 63-35 for the Democrats.

In sum, if the electorate in 2012 had looked like the electorate in 2014 we would be looking at a unified Republican government under President Mitt Romney today.  But it didn't and it most likely won't in 2016 either.  By 2016 most analysts expect the electorate to be about 70% white.  Barring major changes in the way African-Americans and Latinos vote, that means the Republican nominee will need to carry about 62% of the white vote to win the presidency.  That hasn't happened since Ronald Reagan's landslide re-election in 1984.

What Happened: Geography

Geographically speaking, the electoral map favored the elephants heading into the 2014 midterm election so it really is no surprise that Republicans took control of the Senate and increased their majority in the House.  The donkeys were defending Senate seats in at least 7 states that voted for Mitt Romney in 2012 including three in the south.  Republicans won two of the three outright on November 4th and will likely win the runoff in Louisiana in December, which means the 114th Congress will not have a single Democrat in the Senate from the old confederacy except for purple Virginia and purple Florida.  The transition of the south from solid (conservative) Democrat to solid (conservative) Republican is officially complete.   In the Old Dominion (VA) the incumbent Democrat is clinging to a 12,000 vote lead with 95% of the vote counted so a flip in that state is still possible.

Outside of the south, Republicans picked up two seats in states Obama carried in 2012 (Iowa and Colorado) in races that turned out not to be as close as the poll watchers predicted.  Alaska has yet to be decided but the elephant appears to have an insurmountable lead over the donkey there.  When all is said and done it looks like Republicans will control 54 Senate seats to 44 for the Democrats plus two independents who caucus with the donkeys.

On the House side of things, Republicans stand at 242 seats, which puts them just a few shy of their postwar high water mark with 19 races left to decide.  It is entirely possible that Republicans will get to 250 seats.

What it Means

Sadly, not much.  Sure, Republicans now control the Senate and its committees.  That means legislation emanating from that body will reflect Republican priorities (hasta la vista Big Bird!).  In all seriousness, however, it takes 60 votes to get anything of substance through the Senate, which means either the GOP will need to learn how to compromise or it will look exactly as useless as Harry Reid's Democrats have for the past two years.  In addition, President Obama still wields the veto stamp so any significant changes to the Affordable Care Act are likely a pipe dream for the GOP.

Other issues, such as immigration reform, tax reform, and entitlement reform may have a small chance of seeing some action but that may well depend on the whether or not the House is ready to govern.  The larger Republican majority there may mean Speaker Boehner will have an easier time working out deals with the Senate and bringing them to the floor sure of 218 Republican votes.  He did not have the luxury in the last Congress, which allowed the Tea Party to control him on the big issues and why a bipartisan immigration reform bill cleared the Senate with 70 votes died in the House.

The GOP Senate will also be able to force the president to select nominees for judicial vacancies that are moderates if he hopes to get them confirmed.  Ultimately, what happens is anyone's guess.  Parties typically talk a good game right after a midterm election but as we have seen for the last four years, talk is cheap.  Republicans now have a chance to show the country they are prepared to govern and work with a president they despise.  Failure to do so may well lead to a very short Senate majority come 2016.

Wednesday, September 17, 2014

What's the Matter with Kansas, er, Thomas Frank?

Thomas Frank, author of a splendid little story called What's the Matter with Kansas?, apparently woke up on the wrong side of the Kansas/Missouri border earlier this week and he blames political scientists for it.  Really, he blames just about everybody but himself.  His latest missive on takes on an article that Ezra Klein (of the Washington Post) wrote for Vox a few weeks back during the American Political Science Association's annual meeting in Washington, D.C.  In the article, Klein argues that the inability of political elites in Washington to speak in anything other than partisan soundbites and ambiguous self-serving statements has driven many young Washington journalists into the open arms of the numerous political scientists, like myself, who study and write about political behavior.  As a political scientist I say it is about dang time they pay attention to what we know!  Every time I read a story about the 'Six Year Itch' or how Democrats are 'tax and spend' liberals or Republicans are 'racists' I just shake my head and cringe.  What does this have to do with Thomas Frank?  Everything.

You see, the thesis of Frank's book is that Republicans have duped white middle class voters into voting for them on the basis of social issues like opposition to abortion, same-sex marriage, and opposition to gun control.  Then, once they get into office, they abandon the social issues to implement their economic agenda, which is detrimental to white middle class voters.  The problem, as political scientists like Larry Bartels points out, is that there just isn't any evidence to support Frank's thesis.  Survey data indicates that outside the south white middle class voters still tend to vote for Democrats.  The data also indicates that most voters are more driven by economic issues than by social issues.  So what does Frank do?  He blames the data and those who analyze it while insisting that he, and he alone, understands why Democrats will likely lose seats in the November midterm elections.  Brace yourself for Frank's most unlikely answer to that question.

In a nutshell, Frank thinks the problem has nothing to do with structural factors that advantage the party out of power in midterm elections.  No, it has nothing to do with conservative voters angst over not controlling the Senate and/or the White House.  So, why, according to Frank, are Democrats going to get whipped in November?  Are you ready?  Here it comes...Democrats are going to lose in November because they just aren't liberal enough for white middle class voters!  If only they had more left wingers like Bernie Sanders and Elizabeth Warren the party would fare exceptionally well with white voters in Mississippi, Louisiana, Arkansas, and all the other states that voted for Mitt Romney in 2012.  I am absolutely certain that a left winger in Mississippi would fare quite well, considering the recent Republican primary debacle in which many white conservatives voted for the guy that would have eliminated the federal government entirely!

In his despondency over why Democrats will not regain control of the U.S. House in November Frank writes,
"You might recall that Democrats controlled the House of Representatives from the early 1930s until 1994 with only two brief Republican interludes. What ended all that was not an ill-advised swerve to the left, but the opposite: A long succession of moves toward what is called the “center,” culminating in the administration of New Democrat Bill Clinton, who (among other things) signed the Republicans’ NAFTA treaty into law."
You got that?  Two things are to blame for why Democrats no longer control the House:  (1) they moved to close to the center between the 1930's and 1994 and; (2) Bill Clinton signed NAFTA into law.

Wow, it is remarkable how Frank is able to engage in revisionist history in such a few brief sentences.  His first point is just plain wrong.  Every analysis of party ideology shows that since the 1930's the Democratic Party has become more liberal, not more centrist or conservative.  To be sure, the party has not moved as sharply leftward as the Republicans have moved rightward.  It is also true that the Democratic Party has become much more friendly with business interests and is much more dependent upon them than it was a generation ago.  However, that is not the same as moving to the center as Frank asserts.  He conveniently glosses over the fact that for much of the period from the 1930's to 1994 the power brokers in the Democratic Party were conservative southerners.  They held most of the committee chairs and enabled a coalition with conservative Republicans that could stop any liberal legislation the coalition opposed.  Jonathan Bernstein does a good job taking Frank down on this point.

As for NAFTA, sure it may have cost Democrats a few seats in Congress but it is by no means the massive shift to the center that Frank insinuates.  It might even have been a mistake for Bill Clinton to sign it but hindsight is almost always 20-20.

In the end, what's the matter with Thomas Frank is simply that evidence doesn't matter to his view of the world of politics.  He tells a great story but one that is largely a work of fiction.  Perhaps that what the people of Kansas need to get them through troubled times.  I'll stick with the evidence, even if I wish it sometimes told a different story.


Thursday, February 6, 2014

Universal Healthcare: Is It A Disincentive To Work?

The political press is ablaze today following the latest report from the Congressional Budget Office (CBO) on the labor market.  Buried somewhere in the report is an estimate that the Affordable Care Act (ACA) may result approximately two to two and a half million Americans choosing to work less or not at all within a decade due to the availability of subsidized health insurance.  While this isn't the focus of the report, it is what the political elite chose to fixate upon. Republicans seized on the estimate as proof positive that the ACA is a bad thing and creates a disincentive to work and incentivizes laziness and dependency upon the government.  The Republican aligned Washington Times spun the story as one that will 'Push 2 Million Workers Out of the Labor Market.'  The left-leaning Washington Post spun the story as one of choice by claiming the ACA would 'prompt over 2 million to quit jobs or cut hours', ostensibly because they could keep their health insurance even if they gave up their job.  Democrats immediately began arguing that this is a positive thing as some of those who gave up their jobs might take a risk and start a business that could end up employing others.  Others might take their new found independence from working a low wage job to spend more time with their kids or spouses.  Either way, the spin from the political elite highlights one of the idiosyncratic features of the American economic ethos...tying the provision of health insurance to an employer.

Adopting a normative framework, one might ask why health insurance in America is so intricately tied to one's employment status?  Do people without jobs have no need of health insurance?  What about those in low wage industries whose employers do not offer coverage?  If we are going to link employment and health insurance it seems logical that all employers should be required to offer it to their workforce.  Yet, prior to the ACA that was not a requirement.  Even after the ACA small businesses with fewer than 50 employees are exempt from providing health insurance coverage to employees and those with more than 50 employees only have to pay a $2000 fine (per employee) if they fail to offer insurance.  Considering that providing coverage to a worker costs far more than $2000 per worker, the real disincentive in the law is benefit for employers who can save hundreds of thousands of dollars by dropping health care coverage for their workforce.  Of course, many of those workers will then qualify for federal subsidies to purchase insurance on the market exchanges, which means that once again the government is subsidizing large corporate employers as it has done for decades.  For example, McDonald's and Wal-Mart employees are among the largest recipients of federal benefits in the country.  Why are taxpayers subsidizing below poverty level wages at these highly profitable companies?  So we can have a $.99 cheeseburger or pay $.06 less for a loaf of bread?  Please!

A second aspect that arises from all the chatter about the potential effect of the ACA on employment is just how much politicians, Republicans in particular, love to talk about work.  It is as though work has been raised to the status of a demi-god.  Don't get me wrong, I'm all for working and I do my fair share of it between a full time job and two side jobs now and then.  And I am in the rather unique position of loving what I do, something many Americans cannot say.  Nevertheless, the emphasis on work also seems to be something idiosyncratic to America.  Many cultures, both past and present, place more emphasis on the family or community or the life of the mind than we Americans do.  For example, Australia requires all employers to provide 20 days of paid vacation per year plus 10 paid holidays.  French workers get a minimum of 5 weeks paid holiday leave plus up to 22 days of reduced time for workers who work between 35 and 39 hours a week.  Even our Canadian neighbors to the north mandate a minimum of 10 paid vacation days per year.  The good old USA?  0 days of mandatory paid vacation.  It makes one wonder if there is a correlation between the disintegration of the American family and the emphasis placed upon working at all costs, even in dead end low wage jobs.

In the end, we all have the same fate to look forward to.  I think it was Barbara Bush who said something to the effect of this:  At the end of your life when all is said and done it is highly doubtful you will look back and wish that you had gone to the office just one more time or pulled that double shift at Burger King. No, the thing you will wish you had done more of is spend time with your kids, with your spouse, with your friends and loved ones.  So...I say, if the ACA makes that possible for some people, it's a step in the right direction.  I'm okay with that, how about you?

Tuesday, November 12, 2013

Slavery? Beholden to a foreign master? Seriously, Sarah?

Correct me if I am wrong but didn't we have an election about 5 years ago in which the country told Sarah Palin to pack her bags and go back to Alaska?  I seem to recall her and her running mate losing by more than 7 million votes in 2008.  But hey, I'm getting older so my memory could be slipping.

So let's get this straight...Sarah Palin believes that the United States' $17 trillion dollar debt is the moral equivalent of slavery?  It is, in her mind, the equivalent of one person being able to own another and deny him/her basic human rights.  It gives our 'foreign masters' the right to whip us at will, sell us to any other party, or kill us without repercussion?  Is that what you're saying, Sarah?  I just want to make sure I understand before I proceed.

Okay, so what's wrong with Palin's analogy?  So much that I don't know where to begin.  I guess the beginning is as good a place as any.  Palin says,
"Our free stuff today is being paid for by taking money from our children and borrowing from China..."
What 'free stuff' would that be?  Government services aren't free and they never have been.  Fighting two wars in the middle east wasn't free.  Building a 21st century infrastructure of roads, bridges, rail networks, and schools is not free.  Caring for the weakest among us is not free.  Keeping 25% of the world's prison population locked up is not free.  All this 'stuff' costs money.  We, as a society, have chosen together to do these things, regardless of what you and your merry band of naysayers want to believe.  You and people of your ilk have engaged in obstruction, refused to allow the appropriate level of taxation to pay for the things WE have chosen to do together, leading us to the $17 trillion in debt we have racked up...most of which accumulated under Republican leadership.  The following graph shows the change in the debt as a percentage of GDP since WWII.

What we see in the above graph is that debt began to grow during the Reagan Administration and but for a few short years during the Clinton Administration has continued to grow ever since.  There are several reasons for that, including repeated tax cuts, increased spending commitments, and slow economic growth (except 1997-2000) when compared to the period from 1945-1980.  Another way to look at it is in terms of total dollars added to the debt, as the chart below shows.

Using this scenario, both President George W. Bush and President Obama have added a lot to our debt, though Reagan is still the debt king in terms of the percentage by which the debt increased while Clinton and Obama have increased it by the smallest percentages.  Perhaps this is due to Republicans rediscovering their fiscal conservatism whenever a Democrat is in the White House?  

What about Palin's primary claim that we are 'taking money from our children and borrowing from China'?  Is this true?  Yes and no.  We aren't literally robbing our children's piggy banks any more than a parent who buys his/her kids' Christmas presents with a credit card is taking money from them.  Only, we are not buying presents, we are investing in our future as a nation.  Yes, someone has to pay for that, whether it is the current generation, the next generation, or the one after that.  Unless economic growth returns to the 4-5% annual rate it was in the 1950's we won't have the money to pay for all our commitments without substantial tax increases.  I would, of course, argue that some tax increases are in order as we are currently paying the lowest rate of federal taxes in over 60 years and nearly half of all Americans pay no income tax at all (I'd rather abolish the income tax but that is for another day).  To move those individuals into tax paying status requires economic growth that includes substantial growth in wages for lower middle class workers, which have been stagnant for 35 years.  

Okay, so what about our 'foreign masters'?  Does China really own us?  Not really.  It is a fundamental misunderstanding on the part of lazy people like Sarah Palin to believe that.  Here are the facts:

The United States is currently a little over $17 trillion in debt, though that is somewhat misleading since we have $200 trillion in assets (oil, gas, land, buildings, etc...).  Of that debt, about 1/3 is owned by government agencies.  The single largest creditor for the U.S. government?  The Social Security Administration (SSA).  As of August 30, 2013 the SSA owns $2.764 trillion in government treasuries.  This is because for nearly 80 years Social Security has collected more in revenue than it has paid out in benefits.  The excess money is invested in US treasury bills, allowing the SSA to collect interest on the excess.  Someday, those T-bills will come due and the government will either have to raise taxes to pay them off or issue more T-bills and pay the old ones off with the proceeds from the sale of the new T-bills.  That is essentially what the government has been doing for 35 years.  The rest of this part of the debt is held by pension funds for the government, FDIC, and some other federal agencies.  

What about the other 2/3 of the debt?  Isn't that owned by China?  Well, no.  About $12 trillion of our national debt is what we call 'debt held by the public', which includes foreign held debt.  As of March 2013 almost half of the debt held by the public was held by the central banks of foreign governments.  Why?  Because America pays her bills and is viewed as a solid investment.  Or at least we were until Sarah Palin and the Tea Party started threatening to default on the debt.  Overall, $5.7 trillion of our public debt is held by foreigners.  China is the largest single holder of that debt at $1.27 trillion (August 2013), or roughly 10% of the total of public debt.  Japan's central bank is second at about $1.1 trillion.  But the largest holder of U.S. public debt?  The Federal Reserve Bank of the United States ($1.74 trillion).  

The fact is, most of our debt is money we owe not to China or other foreign interests but to ourselves.  We're in no danger of being whipped or hogtied by our 'foreign masters' because of the national debt. The debt is concerning for other reasons but fear of being a slave to our Chinese masters is not one of them.  

Full details on the debt can be found here.

Saturday, November 9, 2013

Strange Bedfellows: The Tea Party and Karl Marx

Karl Marx died 130 years ago in London, yet his legacy lives on through America's latest populist uprising.  No, I don't mean the flame out that was Occupy Wall Street, though that group certainly shared some of Marx's ideological heritage as well.  The populists I speak of are America's own Marxists, aka the Tea Party.  To be sure, many who associate themselves with the tea party will take umbrage with the veracity of my analysis.  I don't care...if it acts and thinks like a Marxist it must be a Marxist.

I began thinking about this subject after a conversation with a gentleman who said Bill O'Reilly was too 'left of center' for him and that Van Jones was further to the left than Karl Marx.  When Bill O'Reilly is left of center I'm no longer certain where the center is.  Nevertheless, let's explore a little of the core beliefs of Karl Marx and the Tea Party.  I'll begin with Marx.

First and foremost, Marx was a philosopher writing about the political economy that existed in mid 19th century Europe.  What he saw everyday was hordes of workers shuffling off to the factories and fields, exchanging their labor for minuscule wages so they might continue to subsist.  Not thrive mind you but just continue to breathe.  This exchange of labor for pay was not voluntary, it was a form of forced servitude that removed the individual's freedom to be his own master.  Unlike modern neo-Marxists, Marx himself was not an egalitarian.  His primary concern was how the unbridled capitalism of his day restricted the individual from achieving his full potential.  Capitalism did this through the alliance of the bourgeoisie and the state.  Compare that with the Tea Party rhetoric opposing crony capitalism and the loss of individual freedom at the hands of the statists, of whom Barack Obama is supposedly the chief.

The free market, Tea Partiers argue, should choose winners and losers, not the government.  Perhaps, but it is now and always has been a myth that there is a truly 'free' market.  A truly free market would be based upon the free exchange of something of value for something of equivalent value.  That would leave neither party worse off nor better off than they were upon entering the market.  When a laborer exchanges his labor for a wage that allows him to survive does he enter that transaction freely and upon equal standing with the one who has a job that needs to be performed?  Only in an economy where there are exactly the number of workers needed to for every available job.  In any other situation, one side or the other is disadvantaged.  Usually, it is the laborer.  Additionally, the laborer is not free to abstain from the marketplace and open his own business because the cost of entry into many areas of commerce are enormous.  Suppose one wants to begin a railroad to deliver goods from a port to warehouses more efficiently than another.  The capital needed to create the infrastructure to compete in that market is prohibitive.  The effect is a monopoly that is usually supported by the state. Sure, the costs of entry may be lower and less prohibitive in some other markets but so too is the risk of market over saturation, which may lead to the collapse of some businesses and the falling into destitution Marx envisioned as stronger competitors eat up weaker ones.

Further, in order for the capitalist to survive, he must realize a profit from the exchange he has made with the one who labors.  If I sell eight hours of my time to an employer for $100 I must produce something valued at much more than $100 if the employer is to remain in business.  In this, Marx recognized how capitalism in his day had abandoned the Lockean principle of private property that meant the laborer had a right to keep what he produced or created.  Marx referred to this as the exploitation of the laboring class.  The greater the difference between the amount the laborer received for his work and what the capitalist could reap from it was the level of exploitation experienced by the worker.  This becomes important when discussing the Tea Party because it ostensibly opposes the oppression it perceives to come from the crony capitalists such as bankers and the political elites, or those who benefit from their affiliation with the state they oppose.  The irony is, of course, that the Tea Party by and large are white, male, and over 45.  They also largely support the Republican Party, which is every bit as state oriented as the Democrats.  Therein lay the roots of the civil war being waged within the modern GOP.

The Tea Party, like Marx, had he been alive today, opposes the modern welfare state, though for very different reasons than Marx would have.  For the Tea Party, the welfare state takes what they have earned from them by force and gives it to those who have not earned it.  Yet, much of the Tea Party opposes any changes to Medicare or Social Security, the two largest entitlement programs.  The Tea Party also largely supports the military industrial complex, the ones who carry the guns for the state they so deplore.  Rather, Tea Partiers oppose 'welfare' programs for the poor, who they see as lazy slackers.

Marx, on the other hand, would likely oppose the welfare state because it interferes with the rise of the proletariat by mitigating the effects of capitalism.  By providing a level of sustenance to the poorest and propping up many low wage earners with programs like SNAP and Medicaid, the impetus to organize and overthrow their oppressors is largely removed.  This why Franklin Roosevelt, in the midst of the creation of the welfare state, could say that he was 'The best friend capitalism ever had.'  Apart from the welfare state, it is likely America might have seen some uprisings such as have occurred in many poorer nations in South and Central America.

In sum, the Tea Party and Karl Marx share much in common.  The Libertarians in the Tea Party hate the state and see it as a coercive force that steals their God given liberty.  Marx saw the state as stealing individual liberty from the proletariat through its alignment with the capitalists.  Marx's hatred of the state drove his vision of a communist utopia that emerged from the wreckage of not only capitalism, but its successor, socialism.  Far from being anti-capitalism, Marx saw it as a necessary stage in the development of communism.  Ironically, the anti-welfare state mentality of the Tea Party, if made reality by gaining power, could very well be the catalyst that awakens the proletariat that has been lulled to sleep by the statists on the left and the right.  The very thing the Tea Party fears most may be what it ultimately creates.

Thursday, October 24, 2013

Could Shutting Down the Government Cost Republicans the House in 2014?

Forrest Gump said, 'Stupid is as stupid does.'  More and more these days I am convinced he was talking about the American media establishment.  Serious investigative reporting has been replaced by nonstop discussion of the latest polling data, which quickly becomes the conventional wisdom among the media elites.  The latest example comes from recent polls that show Republicans are less popular than they have ever least since modern polling began in the 1940's.  The most recent poll puts the party's approval rate at around 28%.  That's not very good but is it the end of the world for the GOP?  Not by a long shot. 

Social scientists have been gathering data on the voting habits of Americans for at least 60 years and we have learned a lot over that time.  One thing we know is that party identification is the strongest predictor of how an individual will vote in any given election.  Republican identifiers vote for Republicans and Democrat identifiers vote for Democrats at very high rates.  Additionally, most independents are not truly independents but are weak party identifiers who usually vote for the same party in most elections.  The idea of an American electorate that swings back and forth is a myth.  American elections are largely driven by structural factors, not careful deliberation by voters analyzing the nuances of public policy. 

The problem with all the discussion of the unpopularity of the GOP possibly costing the party the House next year is that no matter how unpopular Republicans are in national polls it doesn't amount to a hill of beans at the local level.  Midterm elections are driven by dynamics that are not present in presidential elections.  If 2014 were a presidential election year the discussion of Republicans losing the House might be more salient.  But it isn't. 

The party holding the White House enters every midterm election at a disadvantage simply because partisans affiliated with the party out of power are more motivated to vote and check the power of their opponents.  In 2014 this probably means that more Republicans than Democrats will turn out to vote in the midterm elections next year.  Those Republicans will vote for Republican candidates no matter how unpopular the party is nationally. 

Further, the way most congressional districts are structured provides the party currently holding the seat with an inherent advantage.  Democratic supporters are often packed into urban districts that may be 70-80% Democratic, which means that a lot of Democratic votes are 'wasted' electing a Democratic candidate who would win the election anyway.  Republican districts are not as compact and often encompass many rural voters unlikely to switch parties regardless of the current popularity of their party.

To be clear, this does not mean Republicans cannot lose the House next year.  Anything is possible in politics.  Consider, however, that the last two times the party holding the White House gained House seats in a midterm election the gains were 8 seats in 2002 for the GOP and 5 seats for the Democrats in 1998.  Democrats currently need to pick up 17 seats to take control of the House.  The last time a party controlling the White House won enough seats to take control of the House of Representatives in a midterm election?  It has never happened in American history.  Does that mean it won't happen in 2014?  No, but 225 years of history tells me it is highly unlikely.

Tuesday, October 8, 2013

Can the U.S. Actually Default on its Debt?

A new meme is beginning to emerge from some of the more hardcore conservatives in the GOP, particularly those in the Tea Party faction, claiming that it is not technically possible for the U.S. Government to default on its debt.  The thinking, if you want to call it that, is that since revenue to the treasury is forecast to be around $250 billion per month and monthly interest on the national debt is expected to be around $31 billion per month (see the president's 2014 budget here), then the treasury should have no problem paying the interest each month whether a debt ceiling hike is passed or not.  Technically speaking, they are absolutely right.  The problem, of course, is that the FY 2014 budget is estimated to be upside down by about $700 billion, or some $58 billion a month.  The treasury is then faced with a dilemma as to how to prioritize revenue outlays.  An additional problem is that the Treasury doesn't have the ability to prioritize payments the way a household might.  For example, a household could choose to pay the most important bills each month first (mortgage, auto, grocery, utility) and then pay the credit cards with what is left.  If the household comes up short, something doesn't get paid unless the household can take a loan to cover the shortfall...most households do this by making purchases on credit with the intent to repay it next month or over time. 

Treasury, however, does not have this luxury.  According to the wonkblog, the federal government receives some 2 million invoices a day for services purchased or debts owed.  Its computer systems are set up to pay invoices in the order received, whether that is grandma's social security check, a payment to a hospital for medical care provided, or an interest payment on a bond.  These invoices are not individually inspected by a human being but are checked by the computer for accuracy and then payment is sent.  There isn't a government accountant with a checkbook somewhere writing out and signing each of the 2 million or more payments processed every day.  Technically, it might even be possible for Treasury to reserve some cash to always pay the bondholders...but without the ability to borrow it would have to skip paying something else.  This could mean a government contractor owed a million dollar payment does not get paid.  He in turn does not pay his employees who respond by not paying the mortgage or car payment.  The consequences of sucking nearly $60 billion per month out of the economy would likely prove chaotic, even if the bondholders got paid. 

In short, what some members of the GOP are advocating right now is a horrible strategy likely to have ruinous consequences on an economy still struggling to pick up the pieces from the 2007-09 recession.  This could be enough to push it off the cliff and make that episode look like the 'good old days.'  That's why many in the business community, typically the GOP's stronghold, have had enough.  Many have begun siding with the president whose policies they have vigorously opposed in the past.  Some have even begun recruiting more moderate Republican candidates to oppose Tea Party darlings in GOP primaries next year.  Conventionally, many mainstream Republicans have avoided speaking out against Tea Party extremism for fear of being 'primaried' from the right next year.  It now appears that at least some Tea Party Republicans may face a challenge from the center.  That, in this writer's opinion, would be a welcome change and just might pull the GOP back from the cliff it seems intent to leap off. 

Thursday, October 3, 2013

Vacuous Leadership & Modern American Politics

As I write this the Federal Government in Washington, D.C. has begun the third day of what could be a very long shutdown that disrupts government services for hundreds of millions of people.  Millions more may either lose their jobs or suffer a crippling blow to their income.  I'm not just talking about the civilian workforce but those who depend upon tourism to national parks or payments to hospitals, for example.  Already we've heard reports of a significant drop in tourism along the Virginia coast leading to restaurants closing their doors, half empty motels, and layoffs.  The saddest part of this present shutdown is that it is completely unnecessary and pointless.  It is the result of mindless, ideological leadership in Washington, D.C., if we dare even to call it that. 

James Madison, it is said, believed that limited government (a phrase found nowhere in the constitution) required the separation of powers into the judicial, the legislative, and the executive in order to function well.  American children are taught this mantra from the earliest days of their civic education, so much so that it may as well be an edict handed down from God above.  However, as the late Richard Neustadt argued, American government is not so much a case of separated powers as it is 'separated institutions sharing power.'  Because of that power sharing arrangement good leadership depends far more upon the cultivation of individual interpersonal skills than on positions and titles alone.  In his classic book, Presidential Power and the Modern Presidents: The Politics of Leadership from Roosevelt to Reagan, Neustadt makes the claim that true power is not the power to issue an order to do something but the power to persuade others to do something because it is in their own best interests to do it.  In fact, when leaders must resort to an order to get something accomplished Neustadt argues that it indicates a failure of leadership.  Sadly, that is the state of modern American politics. 

Whether it is the Democratic leadership in the Senate, which has failed to persuade the House to pass a clean continuing resolution that would fund the government, or the Republican leadership in the House that has failed to round up what Devin Nunes (R-CA) has referred to as the 'lemmings with suicide vests' in the House Republican conference, or the President of the United States, who has failed to build the kind of rapport with either congressional Democrats or Republicans that might allow him to engage in serious bargaining, it is clear that a leadership vacuum exists in Washington. 

Take, for example, Speaker John Boehner's (R-OH) inability to persuade his caucus that passage of a clean CR, which funds the government at essentially the level that the House agreed to in passing the Paul Ryan budget (see chart below), has precipitated this completely unnecessary government shutdown.  The insistence of a small faction of tea-party Republicans to an incoherent, destined to lose position, reflects not only poorly on the Speaker's leadership but also on the weakness of the modern GOP.  It is, essentially, a party in the midst of a not-so-civil war that threatens to destroy it from within. 

On top of the war amongst Republicans in the House, we now have Senate Republicans claiming that a leadership vacuum exists with the GOP caucus there.  Senator Tom Coburn (R-OK) has claimed that Senate Minority Leader Mitch McConnell (R-KY) has effectively delegated leadership of the party to Ted Cruz (R-TX) and Mike Lee (R-UT), as well as the outside interest groups enabled by Citizens United who are promoting challenges to Republican Senators with well-established conservative voting records by redefining what it means to be a conservative. 

We've also now got evidence that Speaker Boehner has been less than genuine in his effort to eliminate subsidies to congressional staffers to help pay for their health insurance on the new healthcare exchanges...something Boehner apparently lobbied hard to keep in the healthcare bill, even going as far as a secret meeting with Harry Reid (D-NV) and President Obama to make sure the subsidies were preserved. Reid's staff has now leaked an email exchange of the discussions between Reid's spokesman and Boehner's spokesman.  These kind of failures in leadership lead only to further  entrenchment and an unwillingness to bargain, as well as deeper distrust between the so-called 'leaders' of their respective caucuses.

President Obama himself is not beyond reproach in any of these failures either.  His own leadership style has left much to be desired.  In his 4+ years as president, Obama has failed to reach out effectively to those in the opposition.  Granted, Republicans were never going to 'like' him but there are steps one can take to at least earn the respect of those with whom one disagrees.  Neustadt maintained that for a president to truly have power and be able to bargain with others, two things are essential.  The first is public prestige, for without the support of the public any president is doomed to failure.  In spite of frequent public addresses and even being reelected to a 2nd term, Obama has failed to move the needle when it comes to public opinion.  The second thing necessary for presidential power is a good professional reputation.  In other words, the president must work hard to earn the respect of those whom he depends upon to accomplish his agenda.  Like the first, the president has failed to cultivate such a reputation, leaving a vacuum in leadership in the White House as well as in Congress.  In a new book by Chris Matthews called Tip and the Gipper: When Politics Worked, Matthews romanticizes about the good old days of the 1980's when two fierce adversaries, Speaker Thomas P. 'Tip' O'Neill (D-MA) and Republican President Ronald Reagan would go at each other publicly but then share drinks together after hours and celebrate each other's birthday.  Perhaps the stories Matthews tells are caricatures or overstate the relationship between O'Neill and Reagan, but it is telling that after Reagan was shot in March of 1981, the Speaker was one of the first to arrive at Reagan's bedside and held his hand while praying through the 23rd Psalm.  One thing is clear from all this:  Reagan and O'Neill had the ability to develop a working relationship with each other despite their personal differences.  Obama and Boehner have demonstrated a complete and utter inability to do the same.  One can only wonder how Republicans would react today if such a misfortune were to befall President Obama. 

For their part, Republicans set out to discredit Obama's presidency from day one, beginning with the infamous meeting in Washington by Republicans distraught over his election recounted in the book Do Not Ask What Good We Do, in which GOP members establish a strategy to delegitimize Barack Obama in any way possible, including personal character attacks, innuendo, and outright lies.  From Mitch McConnell's infamous 2010 statement that Senate Republicans "... single most important thing we want to achieve is for President Obama to be a one-term president" to Joe Wilson shouting 'You Lie' during a joint address to Congress to the birther nonsense to current claims by right-winger Jerome Corsi that the president is a closet homosexual who frequented gay bars in Chicago in the 1990's, it becomes clear the conservative Republicans not only dislike Obama, in fact, they hate him. Reagan, for his part, was never subject to that kind of bitter hatred by those with whom he disagreed.  
The bottom line is simply that what passes for leadership in Washington these days is, in fact, anything but leadership.  It is vacuous, bitter, and destructive.  Unfortunately, we the people are the ones who put these self centered morons in office so perhaps we are getting the very leadership we deserve, which is to say none at all.

Tuesday, October 1, 2013

The Long Slow Death of Shared Governance, or What Would James Madison Say?

At 12:00 midnight on October 1st the United States government came to a screeching halt, or at least it did for 800,000 'non-essential' federal workers, millions of citizens who depend upon them, their families, and many others planning to visit America's museums, national parks, and presidential libraries.  The shutdown is the result of a lame-brained strategy by a few Tea Party extremists who have read a little too much Ayn Rand and spent a little too much time smoking the peace pipe with Charles and David Koch.  Their shared hatred of the president (yes, they hate the president...take a look back at the images from tea bag rallies, the birther nonsense, and the lies they have concocted and perpetuated about the Affordable Care Act) have sent many of them into 'babbling spasms of stupid.'  There is nothing honorable about what this tyrannical minority, as James Madison might have called them.  Nothing worthy of being called U.S. Congressmen and Congresswomen in a single one of these fanatics.  If the American people had any common sense every single one of them would be voted out of office next year.  But they will not be, largely because they reside in congressional districts that have been constructed to ensure they are reelected again and again regardless of how destructive their actions are to American democracy.  Our shared belief in how self-government works has dissipated and our union is weaker for it.

How did we get here?  In some ways it is the culmination of a more than 30 year war on government that began when Ronald Reagan was elected president in 1980.  In Reagan's first inaugural address he rallied conservatives by declaring that government was not the solution, government was the problem:

The part most commentators miss about his comment is that he was specifically addressing the crisis that existed in 1981...a stagnant economy, high inflation, and widespread unemployment.  Reagan was not anti-government like much of the libertarian infused tea partiers are today.  In fact, Reagan used the tools of government, such as the Federal Reserve, to strengthen the economy, preserve Social Security, Medicare, and deal with the crises that existed in 1981. 

The challenges that exist in 2013 are vastly different than they were in 1981.  A 30 year tax cutting binge in Washington has left the government starved of revenue.  Add to that the stagnant wages of the middle class and you have a recipe for disaster.  Contrary to conservative mythology cutting taxes does not necessarily increase revenue.  If it did the government should just lower all tax rates to zero and then there would be plenty of money, right?  Uh, not exactly. 

Yes, the American economy is stagnant today and has been since the Great Recession began in late 2007.  Things are better than they were in late 2008 and early 2009 when the economy was shedding 400,000 jobs a month.  Yet, the economy is not as good as it should be.  The GOP wants to put the blame for that solely on the shoulders of the president, something they did not do when the economy plunged into recession 6 months into Reagan's first term and unemployment went from 7.4% to 10.8% after Reagan's 1981 tax cuts were passed.  More specifically, the GOP blames the future implementation of the Affordable Care Act for our present woes, even though CEO's say it is the brinkmanship in Washington that creates uncertainty and a reluctance to hire workers and expand their businesses. 

James Madison worried about factions a lot, so much so that he argued the only way to prevent a tyranny of the majority was to break the factions into so many little pieces and so dilute power as to forestall the emergence of any faction that might try to run roughshod over the nation.  The clarity of 236 years of hindsight shows us that his plan has failed.  The emergence of the modern two party system has rent Madisonian Democracy asunder.  The ideal we once shared that elections are about ideas and the way to implement those ideas is to win elections has become but a fond memory.  The GOP has opposed 'Obamacare' from the start, even though its own 'think tank', the Heritage Foundation, proposed a very similar plan in the 1990's, and the party's presidential nominee in 2012 implemented a similar plan as governor of Massachusetts.  First, Republicans lost the 2008 election to Barack Obama.  Then they began making stuff up about 'death panels', 'government takeovers of health care', and the like.  The disinformation campaign has been very effective as nearly 70% of Americans haven't got a clue what the ACA means to them.  Having failed to stop the ACA in 2010, opponents sued in federal court, which culminated in a decision by Chief Justice John Roberts Jr. that the ACA and its individual mandate were a legitimate exercise of congressional authority.  Not satisfied with that, the GOP set out to 'repeal' Obamacare and the House has passed some 40+ bills doing that though not a single one to replace it with something else.  The party's presidential nominee in 2012 promised to sign a repeal of the ACA on day one if he won the presidency.  He lost by nearly five million votes.  So now the nonsense caucus in the GOP, a small but very vocal minority to be sure, has taken the rest of the party, and the nation, hostage to its demand that the ACA be undone.  They have effectively put a gun to the head of Speaker Boehner and told him to bring measures to the floor containing attacks on the ACA or they'll revolt and fire him.  So he has complied.  Failing to get anywhere with the Senate and the president through their childish antics they've now shut down the government. 

In a strange and eerie sort of way President Reagan was right when he said government was the problem in the current crisis.  Not all the government, just the 5th column tea baggers who managed to get themselves elected into government for the sole purpose of destroying what James Madison built more than two centuries ago.  Patriots they are not.  Treacherous traitors?  Indeed.