As Congress prepares for a big debate on the fate of the Bush tax cuts, there’s an internal debate breaking out in progressive circles on how to deal with tax rates on the very wealthy, not just those currently in the top income tax bracket.
This debate-within-the-debate is being driven by two external data points: First, the fact that income inequality in the United States during the last two (or arguably, the last four) decades has especially manifested itself in the concentration of wealth at the very top of the income ladder; and second, the fact that higher taxes for “millionaires” consistently polls well.
James Suroweicki explains the first point nicely in a recent column in The New Yorker:
Between 2002 and 2007…the bottom ninety-nine per cent of incomes grew 1.3 per cent a year in real terms–while the incomes of the top one per cent grew ten per cent a year. That one per cent accounted for two-thirds of all income growth in those years. People in the ninety-fifth to the ninety-ninth percentiles of income have represented a fairly constant share of the national income for twenty-five years now. But in that period the top one per cent has seen its share of national income double; in 2007, it captured twenty-three per cent of the nation’s total income. Even within the top one per cent, income is getting more concentrated: the top 0.1 per cent of earners have seen their share of national income triple over the same period. All by themselves, they now earn as much as the bottom hundred and twenty million people. So at the same time that the rich have been pulling away from the middle class, the very rich have been pulling away from the pretty rich, and the very, very rich have been pulling away from the very rich.
The current debate over taxes takes none of this into account.
Thus, framing the tax progressivity question as mainly involving rates for those with incomes well below super-rich levels misses the mark, and, as both Surowiecki and (for months now) Jonathan Chait have pointed out, misses a political opportunity associated with a widespread popular conviction that the very wealthy don’t pay their fair share of taxes.
In terms of the stakes involved in proposing something like a “millionaire’s tax” (essentially a new and higher top rate on very high incomes), Nate Silver has shown at FiveThirtyEight that it could indeed raise some pretty serious federal revenues.
But the political bonus of a “millionaire’s tax” proposal goes beyond the numbers: it would help expose the really dramatic gap between the two parties on the whole concept of progressive taxation.
After all, even as Democrats debate making federal income taxes more progressive, a growing and increasingly dominant segment of Republicans favor “flattening” tax rates to eliminate progressivity, exempting capital and corporate income from taxation, and/or shifting taxation away from income altogether and focusing it on consumption. And even for those Republicans who don’t embrace radical tax proposals, the “thinking” behind them is the rationale for the vague support for high-end or business tax cuts that’s almost universal in today’s GOP, in growing contradiction with conservative demands for debt-and-deficit reduction.
Anything that makes this contrast more vivid, on terms supported by big majorities of the American public, is a pretty good idea for Democrats. So I’d strongly recommend that in the debate over extending or eliminating Bush’s tax cuts for the top bracket, proposals to crate a new bracket for the “super-rich” ought to become an essential ingredient.
It’s been a very busy week on the primary front, with a block of midwestern states — Kansas, Michigan and Missouri — on Tuesday and Tennessee on Thursday. In all four states, a heavy menu of Republican primaries dominated the landscape, with a few notable Democratic tilts.
I did a reasonably thorough summary of the Midwestern primary results for P-Fix on Wednesday, so I’ll focus today on Tennessee.
With Mike McWherter — son of popular former Gov. Ned McWherter — being unopposed for the Democratic gubernatorial nomination, the GOP contest drew the most attention. As expected, Knoxville Mayor Bill Haslam, scion of the Pilot Oil fortune, used a big financial advantage and a low-key “competence” message to soundly defeat two opponents, Chattanooga Rep. Zach Wamp and Lt. Gov. Ron Ramsey, who both tried to outflank Haslam on the Right. Haslam drew 48 percent of the vote (Tennessee does not have runoffs), with Christian Right favorite Wamp finishing second with 29 percent and Ramsey third with 20 percent. Haslam carried most of the state outside Wamp’s district and a few northeast counties in Ramsey’s base.
The real fireworks in Tennessee involved four highly competitive Republican U.S. House primaries. In Wamp’s 3rd district, which is heavily Republican, self-funded radio talk show host Chuck Fleischmann (backed by Mike Huckabee, whose 2008 campaign manager, Chip Saltsman, ran Fleischmann’s campaign) edged Robin Smith — a former state party chair — who was backed by a host of DC-based conservative groups, most notably the Club for Growth (which was embarrassed when a “for more information” phone number in an anti-Fleischmann mailer turned out to connect callers to a phone sex service).
Two other competitive GOP races were in potential pick-up districts where Blue Dog Democrats are retiring. In Bart Gordon’s 6th district, State Senator Diane Black won a very nasty three-way contest against fellow state senator Jim Tracy and conservative activist Lou Ann Zelenik. Zelenik heated up this race with repeated ethics allegations against front-runner Black, but made national news by opposing construction of an Islamic mosque in the college town of Murfreesboro (she claimed it would be a base for the imposition of Sharia law in Tennessee, believe it or not). In the end, it came down to geography, with Black heavily winning her state senate district while Tracy and Zelenik split the vote in their base county of Rutherford. There was also a competitive Democratic primary in the 6th, won by decorated war veteran Brett Carter, who edged the underfunded but evocatively named Henry Clay Barry.
In John Tanner’s West Tennessee 8th district, where veteran state legislator Roy Herron easily won the Democratic nomination, Republican put on what is reported to be the most expensive House primary in the country. Nationally-recruited farmer and gospel singer Stephen Fincher battled two massively self-funded opponents, broadcast entrepreneur George Flinn and physician Ron Kirkland in a race where total expenditures ranged up towards $8 million, with $3 million spent by Flinn alone. Despite concerted attacks on Fincher for receiving millions in farm subsidies, he won easily with half the vote, dominated his opponents in the areas of the district most remote from Memphis.
And in the Nashville-based 5th district, eleven Republicans competed for the right to wage an uphill battle against Rep. Jim Cooper in a district comfortably won by Barack Obama in 2008. The best-financed candidate, David Hall, defeated Huckabee-backed home-school activist Jeff Hartline and Sarah Palin’s latest “Mama Grizzly,” entertainment attorney CeCe Heil.
Finally, it wasn’t really a competitive primary, but it got attention: 9th district Democratic Rep. Steve Cohen drew a second consecutive opponent who claimed the district required African-American representation. But former Memphis Mayor Will Herenton was widely regarded as an embarrassment, and after Cohen was endorsed by President Obama, former 9th district congressman Harold Ford, Sr., and the Congressional Black Caucus, Cohen breezed to a 79-21 win.
Next Tuesday primaries are being held in Colorado, Connecticut and Minnesota, along with a runoff in Georgia. Colorado features very competitive Senate primaries in both parties (Bennet v. Romanoff among Democrats, Buck v. Norton among Republicans), and a strange GOP gubernatorial primary overshadowed by the meltdown of front-runner Scott McInnis and the third-party candidacy of Tom Tancredo. Connecticut has a close Democratic gubernatorial contest between 2006 Senate nominee Ned Lamont and Stamford mayor Dan Malloy, along with a multi-candidate challenge to Republican Senate front-runner and former wrestling executive Linda McMahon. Minnesota has a very competitive Democratic gubernatorial primary, in which the best-known candidate is former U.S. Senator Mark Dayton. And Georgia’s Republican gubernatorial runoff has become a vicious cage match, with first-place primary finisher, Karen Handel, backed by Sarah Palin, battling former congressman Nathan Deal, backed by Newt Gingrich and a big majority of Georgia Republican congressmen and state legislators.
I’ll have previews of all these events next Tuesday.
Yesterday J.P. Green did a post on the Missouri “ObamaCare referendum,” noting its rather tilted character and echoing Jon Chait’s endorsement of a progressive way around the unpopularity of an individual mandate for the purchase of health insurance, as designed by Paul Starr.
But there’s another aspect of the Missouri vote that ought to be mentioned: the individual mandate that was the target of the the state law ratified by Proposition C wasn’t just a feature of “ObamaCare.” It was also a central element in RomneyCare, Massachusetts’ pioneer health reform effort. And amidst all the rationalizations that Romney has offered in an effort to distinguish RomneyCare from ObamaCare, he hasn’t repudiated his support for an individual mandate.
Even if you don’t think the Missouri vote was a fair representation of overall public opinion in the Show-Me State (and it’s dubious on that front, given the low turnout and the 2-1 Republican tilt among priimary voters), it was sure a good measure of how politically active Republicans feel. And a shudder had to shake Romney when he heard about it, since it’s very unlikely the 2012 Caucus-goers in next-door Iowa are going to feel any warmer towards the individual mandate seventeen months from now, when they once again pass judgment on Mitt’s presidential ambitions.
In discussions of the energy bill this summer, talk focused on a price for carbon. This is a vital component in any legislation that would force companies to reduce emissions, either by becoming more efficient or substituting cleaner fuels. But that’s only realistic if cleaner alternatives, like biofuels, are available to replace dirty fossil fuels. Whether or not cap-and-trade passes this year, biofuels should play a key role in our new energy economy, but we need to reassess federal support to allow for more diverse and higher performing biofuels.
The biofuels industry today continues to rely on significant federal assistance to encourage investment and innovation. In the recent past, federal support has focused on pre-approved types of fuel, most prominently corn ethanol. This policy has aided the boom and bust cycle in today’s biofuels market. The government paid all its subsidies and tax credits to corn ethanol, causing the industry to expand at a faster rate than the market could accommodate. Choosing corn as the favorite resulted in a crash in ethanol prices once it became clear that supply had been propped up by federal support (rather than realistic market demand). These government policies that focus solely on corn ethanol have created both a bias in the market and a situation where investors are not willing to support alternative fuels because of federal support in favor of corn ethanol.
The biofuels market began with alternative fuel mandates in the Energy Policy Act of 1992, but these were mostly filled by conventional biofuels (ethanol derived from cornstarch). Since they were the most developed form of biofuel at the time, they received the bulk of individual tax credits (like the Volumetric Ethanol Excise Tax). Since then, Congress has adopted mandates for advanced biofuels (fuels other than cornstarch ethanol, derived from renewable biomass) and tax credits for cellulosic biofuels (a type of advanced biofuel derived from grasses, woodchips and other non-food sources). But other potential advanced biofuels (such as algae biofuel) still receive no support beyond general R&D funding. Corn ethanol’s stranglehold of the market through congressional subsidies can be seen in what would happen if current tax credits were extended through 2014: ethanol would receive more than 75 percent of the credits, while cellulosic biofuels would get less than 11 percent.
Corn ethanol production in the United States has more than tripled in the last five years, a boom that has caused other problems: diversion of corn away from food production, increased erosion, higher inputs of chemicals and water, and changes in cropping patterns and land use. Worse, these have serious repercussions, including the exhaustion of groundwater supplies, the destruction of native prairies, and the expansion of the Dead Zone in the Gulf of Mexico.
Some advocates for clean energy have pointed to these problems as reasons to stop supporting biofuel development. However, these negative consequences and the recent public backlash against ethanol mean we need a second generation of biofuels that is more diverse and market-based. Business Insights found that biofuels are estimated to account for 5-10 percent of global fuel production by 2017. It is unrealistic to think that our reliance on fuels for combustion engines will decrease anytime soon. Even if electric cars become economically feasible in the near future, it will take time to phase out existing cars. Concerns about energy security, rising oil prices and climate change will increasingly force us to change the energy mix to rely on cleaner fuels. For biofuels, this translates into a very real and growing market demand for at least the next several decades.
That’s why instead of continuing to use biofuel credits to help political constituencies like corn farmers, Congress needs to focus on forms of support that will increase performance and long-term viability for all types of biofuels. A good step toward diversifying the biofuels market is the Advanced Biofuel Investment Act of 2010, proposed by Representative Stephanie Herseth Sandlin (D-SD), which would create a new 30 percent Investment Tax Credit for investing in advanced biorefineries. This would build on existing tax credits, continuing America’s commitment to the biofuels industry.
Futhermore, if we really want to move beyond a market dominated by ethanol, Congress should approve a tax credit like the Biofuels Performance Tax Credit proposed by the Union of Concerned Scientists. All types of biofuels would be eligible for this tax credit and would receive support in proportion to their emissions reduction, rewarding performance, and fostering competition and innovation. The maximum tax credit would be $1.15 for every gallon of gasoline replaced, but to qualify for the full credit, the biofuel must have zero emissions over its lifetime. Thus, the tax credit incentivizes performance both for replacing oil and reducing global warming pollution. It would build on the current Renewable Fuel Standard by supporting producers that go beyond the Standard’s requirement of emissions reductions of at least 20 percent. This would keep incentives technology and feedstock neutral, so we wouldn’t fall into the same trap of placing overwhelming support on one fuel. It is also critical that any tax credit encourage innovation by setting a high standard for emissions reductions and allowing all companies to compete. This should lead to greater innovation and ultimately cleaner fuels.
Adopting the tax credit would be an important step towards a more even distribution of federal subsidies in the biofuels market. This would allow advanced biofuels to receive significantly more than the paltry 11 percent of tax credits that they are currently getting, which would be crucial in building a new energy economy.
The federal government has played a role in creating the ethanol market and it now it must play a stronger role in convincing investors of the potential of the biofuels market. Considerable federal support is needed to get the biofuels industry off the ground. It is essential to create policies that do not limit the market but instead allow for new developments and innovations.
So let’s say you’re a Republican politician who’s been working the far right side of the political highway for years, getting little national attention other than the occasional shout-out in Human Events. Or let’s say you’re a sketchy business buccaneer with a few million smackers burning a hole in your pocket, and you’ve decided that you’d like to live in the governor’s mansion for a while, but you can’t get the local GOP to see you as anything more than a walking checkbook who funds other people’s dreams.
What do you do? That’s easy: Get yourself in front of the loudest parade in town by becoming a Tea Party Activist!
There has been incessant discussion over the last year about the size, character, and intentions of the Tea Party rank-and-file. But, by and large, the political discussion has passed over another defining phenomenon: The beatific capacity of Tea Party membership, which enables virtually anyone with ambition to whitewash his hackishness—and transform from a has-been or huckster into an idealist on a crusade.
After all, to become a “Tea Party favorite” or a “Tea Party loyalist,” all a politician has to do is say that he or she is one—and maybe grab an endorsement from one of many hundreds of local groups around the country. It’s even possible to become indentified as the “Tea Party” candidate simply by entering a primary against a Republican who voted for TARP, the Medicare Prescription Drug bill, or No Child Left Behind. It’s not like there’s much upside to distancing oneself from the movement. Most Republican pols are as friendly as can be to the Tea Party; and it’s a rare, self-destructive elephant who would emulate Lindsey Graham’s dismissal of it all as a passing fad (in public at least).
Here, we’ll take a look at two specific types of politicians who have been especially eager to embrace the Tea Party movement: the fringier of conservative ideologues, for one, and also the self-funded ego freaks who can easily pose as “outsiders,” because no “insiders” would take them seriously. Let’s call these, respectively, the windbags and the moneybags.
By “fringier” conservative ideologues, I mean those who have argued, year in and year out, sometimes for decades, that even the conservative Republican Party simply is not conservative enough. Many of these politicians would be considered washed-up and isolated, or at least eccentric, in an era when “Party Wrecking” was still treated as a cardinal GOP sin. But now it’s as if they’ve been granted a license to kill. One classic example of this type is South Carolina Senator Jim DeMint, who was considered such a crank in the Senate that he was often stuck eating lunch alone as recently as 2008. His views, for example that Social Security and public schools are symbols of the seduction of Americans by socialism, were not long ago considered far outside the GOP mainstream. Now, in no small part because of his identification with the Tea Party Movement, DeMint has become an avenging angel roaming across the country to smite RINOs in Republican primaries, his imprimatur sought by candidates far from the Palmetto State.
Even some of the younger Tea Party firebrands didn’t exactly emerge from their living rooms on April 15, 2009, to battle the stimulus legislation and Obamacare. Marco Rubio of Florida, after all, was first elected to the state legislature ten years ago and served as House Speaker under the protective wing of his political godfather, Jeb Bush. Sharron Angle first ran for office 20 years ago, and was elected to the Nevada legislature twelve years back. And of course the Pauls, father and son, are hardly political neophytes—they have just begun to look relevant again because the Tea Party movement has shifted the GOP in their direction.
And, in addition to the hard-right pols who’ve emerged into the sunshine of GOP respectability, the “outsider” meme surrounding the Tea Party movement has also created running room for well-funded opportunists—the “moneybags.”
These are epitomized by Rick Scott of Florida, who probably would not have passed the most rudimentary smell test in a “normal” election year. While there are always self-funding egomaniacs running for office—California’s Meg Whitman comes to mind along with Connecticut’s Linda McMahon—the former hospital executive presents a unique test case for the whitewashing power of Tea Party identification. He has managed to overcome a deeply embarrassing embroilment in the largest Medicare fraud case in history by taking his golden parachute from Columbia-HCA and becoming a right-wing crusader against health care reform, helping to make that a central cause for the Tea Party movement. (Scott was forced out of his position as head of the for-profit hospital chain, which he tried to build into the “McDonald’s of health care,” and the organization was fined $1.7 billion for overcharging the federal government.)
Pushed out of his job after the fraud decision, Scott decided to found the Conservatives for Patients’ Rights (CPR) group that exploded onto the national scene early in 2009 with a series of inflammatory TV ads attacking health reform, employing the same firm that crafted the Swiftboat Veterans for Truth spots against John Kerry in 2004. CPR also played a major role in organizing the town hall meeting protests in the summer of 2009, which marked the Tea Party movement’s transition from a focus on TARP and the economic stimulus bill to a broader conservative agenda.
So when Scott (a Missouri native who moved to Florida in 2003) suddenly jumped into the Florda governor’s race early in 2010, the cleansing power of tea had already transformed his image among conservatives, making his improbable campaign possible.
On the wrong side of this dynamic was Florida Attorney General Bill McCollum, a former congressman and sturdy, if conventional, conservative who had paid his dues by twice running unsuccessfully for the Senate. McCollum had apparently all but locked up the nomination when Scott, in mid-April, leapt into the ring with ads calling himself a “conservative outsider” who would “run our state like a business,” while tarring McCollum as the candidate of “Tallahassee insiders” responsible for “the failed policies of the past.” Then came a torrent of advertising from Scott ($22 million by mid-July, more than anyone’s ever spent in Florida in an entire primary/general-election cycle) blasting McCollum for alleged corruption, for insufficient hostility toward illegal immigration, for being soft on abortion providers. The assault voided a lifetime of McCollum’s toil in the party vineyards, vaulting the previously unknown Scott into the lead in polls by early June. Worse yet, from a Republican point of view, Scott drove up McCollum’s negatives, and increasingly his own, to toxic levels, handing Democrat Alex Sink the lead in a July general election poll. And now McCollum, fighting for his life, is striking back, drawing as much publicity as he can to Scott’s questionable past, especially the Medicare fraud case against Columbia-HCA.
So the question is: Would Rick Scott have been in a position to carry out what is beginning to look like a murder-suicide pact on the GOP’s gubernatorial prospects if he hadn’t been able to identify himself as an “outsider conservative” with close ties to the Tea Party? That’s not likely, but it’s no less likely than the remarkable epiphanies that have made career pols of marginal relevance such as Jim DeMint and Sharron Angle into apostles of an exciting new citizens’ movement. So the next time you hear a candidate posturing on behalf of the Tea Party, squint and try to imagine what they were like in their former lives. Many of them have only found respectability through the healing power of tea.
Yesterday’s primaries in Kansas, Michigan and Missouri didn’t get a whole lot of national attention, but they produced some interesting results.
As I mentioned yesterday, MI gubernatorial candidate Rick Snyder ran a campaign very much at odds with the CW that the only way to win a GOP primary is to loudly and repeatedly proclaim one’s fidelity to conservative principles and policy positions. The self-proclaimed “nerd” won handily, with 36% of the vote as compared to 27% for congressman Pete Hoekstra and a very disappointing 23% for Attorney General Mike Cox.
Since Snyder explicitly appealed for crossover votes, political detectives (myself included) will try to figure out if that was a big factor in his victory. It was rather interesting that turnout tilted 2-1 Republican in a state that hasn’t gone Republican in a presidential contest since 1988. Certainly the idea that Democrats got involved in a Republican primary will be a source of consolation to conservatives who are none too happy with the results.
Meanwhile, the Democratic gubernatorial candidate known for “centrism,” House Speaker Andy Dillon, didn’t do so well, losing to labor-backed Lansing mayor Virg Bernero by a 59-41 margin. Bernero edged Dillon in his Detroit-area base and then waxed him in heavily unionized areas elsewhere.
The other big Democratic news from Michigan was the defeat of Rep. Carolyn Cheeks Kilpatrick by state senator Hansen Clarke, a development generally attributed to the disastrous decline and fall of her son, former Detroit mayor and current prison inmate Kwame Kilpatrick.
Elsewhere Republicans made the most news and the CW pretty much held. In KS, in a contest dominated by conflicting claims of superior conservatism, Rep. Jerry Moran defeated Rep. Todd Tiahrt by a 50-45 margin, mainly by running up a bigger vote in his own House district. In terms of national endorsements, it was a win for Jim DeMint and a loss for Sarah Palin and Tom Tancredo.
In House races, the big winner on the night was probably the Club for Growth, whichbacked winning candidates in three crowded GOP primaries (MI-3, KS-1 and KS-4). In MI-1, Bart Stupak’s district, where a competitive race is expected in November, add another data point to the Every Vote Counts argument, as exactly one vote separated the two leading Republican candidates (a recount is pending).
And offsetting their bad news from the Michigan governor’s race, conservatives today are crowing about the results of a referendum in Missouri over a proposed state law aimed at blocking implementation of federal health reform legislation. Proposition C, which essentially challenges the U.S. Constitution’s Supremacy Clause by outlawing mandated health insurance, won by a 71-29 margin, which is very impressive until you realize that primary turnout in Missouri was 2-1 Republican. In any event, the referendum will have no practical effect, but that won’t keep conservatives from bragging about it.
Everyone’s approvingly linking to this Edward Luce piece on “the crisis of middle-class America.” I want to set myself on fire.
Seriously, it’s discouraging to see so many people who should know better (because they’ve argued these points with me before) promoting this article. I can’t think of another piece in the doomsday genre—and there are many—that gets it so consistently wrong. I’ll stipulate that none of the criticisms below are intended to minimize the struggles that many people are facing. But it’s important to get this stuff right. Let me dive in, with Luce’s words in italics and my responses following:
Yet somehow things don’t feel so good any more. Last year the bank tried to repossess the Freemans’ home even though they were only three months in arrears.
The share of mortgages either in foreclosure or 3 or more months delinquent is 11.4 percent, which, because 30 percent of homeowners have paid off their mortgage, translates into 8 percent of homes. So the Freemans’ situation is typical of about one in twelve homeowners, or not quite 3 percent of households (since one-third rent).
Their son, Andy, was recently knocked off his mother’s health insurance and only painfully reinstated for a large fee.
Luce is arguing that there’s a new crisis facing the current generation. About 30 percent of those age 18 to 24 were uninsured in 2008 when the National Health Interview Survey contacted them. I don’t have trends for that age group, but the share of Americans under age 65 without health insurance coverage was 14.7 percent in 2008, up from…14.5 percent in 1984.
And, much like the boarded-up houses that signal America’s epidemic of foreclosures, the drug dealings and shootings that were once remote from their neighbourhood are edging ever closer, a block at a time.
Well, the violent crime rate in 2008 was 19.3 per 1,000 people age 12 and up, down from 27.4 in 2000 and 45.2 in 1985.
Once upon a time this was called the American Dream. Nowadays it might be called America’s Fitful Reverie. Indeed, Mark spends large monthly sums renting a machine to treat his sleep apnea, which gives him insomnia. “If we lost our jobs, we would have about three weeks of savings to draw on before we hit the bone,” says Mark, who is sitting on his patio keeping an eye on the street and swigging from a bottle of Miller Lite. “We work day and night and try to save for our retirement. But we are never more than a pay check or two from the streets.”
The key question is, again, Is this worse than in the past? The risk of a large drop in household income has risen modestly, but people experiencing a drop end up much better off than in the past. For example, the risk of a 25 percent drop in income over 2 years has risen from 7 percent among married couples in the late 1960s to 14 percent in the mid-2000s (based on my computations from Panel Study of Income Dynamics data). But if you look at the average income of married-couple families after their 25 percent drop, it rose from $40,000 to $63,000 (in constant 2009 dollars).
Solid Democratic voters, the Freemans are evidently phlegmatic in their outlook. The visitor’s gaze is drawn to their fridge door, which is festooned with humorous magnets. One says: “I am sorry I missed Church, I was busy practicing witchcraft and becoming a lesbian.” Another says: “I would tell you to go to Hell but I work there and I don’t want to see you every day.” A third, “Jesus loves you but I think you’re an asshole.” Mark chuckles: “Laughter is the best medicine.”
Hmmm…just a typical American household…
The slow economic strangulation of the Freemans and millions of other middle-class Americans started long before the Great Recession, which merely exacerbated the “personal recession” that ordinary Americans had been suffering for years. Dubbed “median wage stagnation” by economists, the annual incomes of the bottom 90 per cent of US families have been essentially flat since 1973 – having risen by only 10 per cent in real terms over the past 37 years. That means most Americans have been treading water for more than a generation. Over the same period the incomes of the top 1 per cent have tripled. In 1973, chief executives were on average paid 26 times the median income. Now the multiple is above 300.
Adjusting for household size and using the PCE deflator to adjust for inflation, median household income in the Current Population Survey rose from $29,800 in 1973 to $40,500 in 2008 (in 2009 dollars, again based on my compuatations). Factoring in employer and government noncash benefits would show even more impressive growth.
In the last expansion, which started in January 2002 and ended in December 2007, the median US household income dropped by $2,000 – the first ever instance where most Americans were worse off at the end of a cycle than at the start.
This is entirely a function of changes in the population composition (more Latinos) and in the share of employee compensation going to health insurance and retirement plans.
Worse is that the long era of stagnating incomes has been accompanied by something profoundly un-American: declining income mobility.
Nope. The evidence is ambiguous, but the best studies imply that intergenerational economic mobility hasn’t changed that much in the past few decades. Intra-generational earnings mobility has increased since the 1950s, though it has declined among men.
Alexis de Tocqueville, the great French chronicler of early America, was once misquoted as having said: “America is the best country in the world to be poor.” That is no longer the case. Nowadays in America, you have a smaller chance of swapping your lower income bracket for a higher one than in almost any other developed economy – even Britain on some measures. To invert the classic Horatio Alger stories, in today’s America if you are born in rags, you are likelier to stay in rags than in almost any corner of old Europe.
Tim Smeeding’s research based on the Luxembourg Income Study shows that in general Americans have higher incomes than their European counterparts as long as they are in the top 80 to 90 percent of the income distribution. Below that, incomes are more comparable across countries, and the living standards of Americans look less impressive. The US has comparable intergenerational earnings mobility to Europe, according to Markus Jantti’s research, except among men (but not women) who start out at the bottom. In terms of occupational mobility, David Grusky’s research shows we’re as good or better as anywhere else, but this doesn’t translate into earnings mobility because we let people get rich or poor to a greater extent than other countries do. Jantti and Anders Bjorklund have estimated that Sweden would have the same mobility as the U.S. if the return to skill was as high there as it is here. Finally, employer benefits further complicate how “bad” we look.
Combine those two deep-seated trends with a third – steeply rising inequality – and you get the slow-burning crisis of American capitalism. It is one thing to suffer grinding income stagnation. It is another to realise that you have a diminishing likelihood of escaping it – particularly when the fortunate few living across the proverbial tracks seem more pampered each time you catch a glimpse. “Who killed the American Dream?” say the banners at leftwing protest marches. “Take America back,” shout the rightwing Tea Party demonstrators.
Unsurprisingly, a growing majority of Americans have been telling pollsters that they expect their children to be worse off than they are.
Totally wrong. The key here is to only look at polling questions that ask people about their own kids, not kids in general. Here are the relevant survey results I could find:
General Social Survey (1994)—45 percent said their children’s standard of living will be better (vs. 20 percent worse)
General Social Survey (1996)—47 percent
General Social Survey (1998)—55 percent
General Social Survey (2000)—59 percent
General Social Survey (2002)—61 percent said their children’s standard of living will be better (vs. 10% worse)
General Social Survey (2004)—53 percent
General Social Survey (2006)—57 percent
General Social Survey (2008)—53 percent
Economic Mobility Project (2009)—62 percent said their children’s standard of living will be better (vs. 10 percent worse) (unlike GSS and PRC, asked only of those with kids under 18)
Pew Research Center (2010)—45 percent said their children’s standard of living will be better (vs. 26 percent worse)
BusinessWeek (1989)—59 percent said their children will have a better life than they had (and 25 percent said about as good)
BusinessWeek (1992)—34 percent said their children will have a better life than they had (and 33 percent said about as good)
BusinessWeek (1995)—46 percent said their children will have a better life than they have had (and 27 percent said about as good)
BusinessWeek (1996)—50 percent expected their children would have a better life than they have had (and 26 percent said about as good)
Harris Poll (2002)—41 percent expected children will have a better life than they have had (and 29 percent said about as good)
Harris Poll (1997)—48 percent felt good about their children’s future
Harris Poll (1998)—65 percent felt good about their children’s future (17 percent N.A.)
Harris Poll (1999)—60 percent felt good about their children’s future (15 percent N.A.)
Harris Poll (2000)—63 percent felt good about their children’s future (17 percent N.A.)
Harris Poll (2001)—56 percent felt good about their children’s future
Harris Poll (2002)—59 percent felt good about their children’s future
Harris Poll (2003)—59 percent felt good about their children’s future
Harris Poll (2004)—63 percent felt good about their children’s future
Pew Research Center (1997)—51 percent said their children will be better off than them when they grow up
Pew Research Center (1999)—67 percent said their children will be better off than them when they grow up
Bendixen & Schroth (1989)—68 percent said their children will be better off than they are
Princeton Religion Research Center (1997)—62 percent of men said their sons will have a better chance of succeeding than they did; 85 percent of women said their daughters will have a better chance
Angus Reid Group (1998)—78 percent said children will be better off than them
Washington Post/Kaiser Family Foundation/Harvard (2000)—46 percent said they were confident that life for their children will be better than it has been for them
Economic Mobility Project (2009)—43 percent said it would be easier for their children to move up the income ladder
Economic Mobility Project (2009)—45 percent said it would be easier for their children to attain the American Dream
Also, polls consistently show that Americans say they have higher living standards than their parents.
And although the golden years were driven by the rise of mass higher education, you did not need to have graduated from high school to make ends meet. Like her husband, Connie Freeman was raised in a “working-class” home in the Iron Range of northern Minnesota near the Canadian border. Her father, who left school aged 14 following the Great Depression of the 1930s, worked in the iron mines all his life. Towards the end of his working life he was earning $15 an hour – more than $40 in today’s prices.
Thirty years later, Connie, who is far better qualified than her father, having graduated from high school and done one year of further education, makes $17 an hour.
It’s not valid to compare her pay mid-career to her father’s at the end of his career—and also, how much work experience does she have relative to him? Did she take time off to raise kids?
The pace of life has also changed: “We used to sit around the dinner table every evening when I was growing up,” says Connie, who speaks with prolonged vowels of the Midwest. “Nowadays that’s sooooo rare.”
Time-use surveys show that while parents spend more time working (because of mothers) than in the past, they do not spend less time with children. They spend less time doing things by themselves.
Then there are those, such as Paul Krugman, The New York Times columnist and Nobel prize winner, who blame it on politics, notably the conservative backlash which began when Ronald Reagan came to power in 1980, and which sped up the decline of unions and reversed the most progressive features of the US tax system.
Fewer than a tenth of American private sector workers now belong to a union. People in Europe and Canada are subjected to the same forces of globalization and technology. But they belong to unions in larger numbers and their health care is publicly funded.
Though unionization has declined markedly in most of these countries, and their health care policies are increasingly becoming too costly. Also, most of the decline in unionization in the U.S. occurred before Reagan took office.
More than half of household bankruptcies in the US are caused by a serious illness or accident.
This is bad Elizabeth Warren research—she counts a bankruptcy as being “caused” by illness or accident if one was reported, but the household could have been in serious debt before these occurred. At any rate, bankruptcies are exceedingly rare (under 1 percent of households—see Figure 13).
Pride of place in Shareen Miller’s home goes to a grainy photograph of her chatting with Barack Obama at a White House ceremony last year to inaugurate a new law that mandates equal pay for women.
As an organizer for Virginia’s 8,000 personal care assistants – people who look after the old and disabled in their own homes – Shareen, 42, was invited along with several dozen others to witness the signing.
Ah…another representative household…
More and more young Americans are put off by the thought of long-term debt.
Evidence?
Had enough? I have speculated that to the extent economic insecurity has increased, it reflects the impact of a negativistic media (amplified by gloom-and-doom liberalism).
Pieces like Luce’s—and the blog posts it generates—affect consumer sentiment. Ben Bernanke and Tim Geithner aren’t the only people who can inadvertently talk down the economy.
This week’s political menu features four state primaries, today in Kansas, Michigan and Missouri, and on Thursday in Tennessee. Since none of these states have 50 percent requirements for party nominations, the primaries will be decisive, and in many cases involving large fields of candidates and low turnout rates, nominees will head towards November without a whole lot in the way of demonstrated public appeal.
Speaking of low turnout, estimates are that about 20 percent of Kansans (a closed primary state) will vote today, with perhaps 25 percent in Michigan and Missouri (open primary states).
The marquee events in Michigan are competitive gubernatorial primaries in both parties (Democratic Gov. Jennifer Granholm is term-limited). On the Democratic side, House Speaker Andy Dillon, generally regarded as a moderate, held the lead for months, but seems to have lost it to a late surge by labor-backed Lansing mayor Virg Bernero. According to a survey last week from Michigan-based EPIC-MRA, Bernero leads Dillon 40-32, though the undecided vote remains high. On the margins, the Democratic turnout could be influenced by the high-profile efforts of one Republican candidate, former Gateway executive Rick Snyder, to encourage a crossover vote (Michigan allows voters to choose which primary they will participate in after they enter the voting booth).
That same EPIC-MRA poll shows Snyder, who has outspent his opponents using personal wealth, in a very close three-way race for the GOP nomination against Attorney General Mike Cox and Rep. Peter Hoekstra. Lingering back in the pack is Oakland County Sheriff Mike Bouchard, the favorite candidate of Michigan-bred Guitar-Idol-turned-Right-Wing-Activist Ted Nugent. As is often the case in this year’s GOP primaries, Hoekstra and Cox are engaged in a more-conservative-than-thou competition. But unusually, Snyder is content to be labeled a “moderate,” and has accepted an endorsement from longtime Republican Gov. Bill Milliken, who in turn endorsed the last two Democratic presidential nominees. Former Congressman Joe Schwarz, widely reviled as a RINO by Michigan conservatives, is heading up an outreach program for Snyder among Democratic and independents. If this works, the iron control of the GOP nationally by the conservative movement will relax the slightest bit, and if it fails, it will be an object lesson to would-be Republican moderates everywhere.
There are a host of competitive congressional primaries in Michigan today, mostly on the Republican side, where candidates will battle for nominations for three open seats (two now held by Republicans, including gubernatorial candidate Hoekstra and fellow-West-Michigander Vern Ehlers, and one now held by retiring Democrat Rep. Bart Stupak), and for the right to take on theoretically vulnerable Democratic freshmen Mark Schauer and Gary Peters. Among Democrats, the big races involve challenges to long-time incumbents, with Detroit Congresswoman Carolyn Cheeks Kilpatrick in very big trouble (in no small part because of the sins of her son, former mayor Kwame Kilpatrick). Having won re-nomination two years ago against a divided field, Kilpatrick is now in danger of losing to State Senator Hansen Clarke. The incumbent has fought back with endorsements and campaign appearances from Jesse Jackson, Sr., and Jim Clyburne, but nobody will be surprised if she becomes the fourth House incumbent to lose in a primary so far this year. Another incumbent unlikely to meet that fate is Sandy Levin, who is burying challenger State Senator Mike Switalski in heavy spending and active campaigning (securing fundraising help from Bill Clinton).
In Missouri, the race to succeed retiring Republican Sen. Kit Bond will be formalized today, with Democrat Robin Carnahan facing only token opposition, and Rep. Roy Blunt likely defeating Tea Party favorite, State Senator Chuck Purgason. Blunt did a good job of recruiting national conservative support, most notably the chair of the new House Tea Party Caucus, Michele Bachmann of Minnesota. The Carnahan-Blunt race will match representatives of Missouri’s two most prominent political dynasties; Roy is the father of former Gov. Matt Blunt, while Robin is the daughter of Mel (governor) and Jean (senator) Carnahan.
The hottest House race in MO is the Republican contest to choose an opponent for House Armed Services Committee Chairman Rep. Ike Skelton, who represents an increasingly conservative district that routinely goes Republican in presidential elections. State Senator Bill Stouffer appears to be the GOP establishment’s choice, while Vickie Hartzler is a longtime Christian Right activist. With a ton of minor candidates on the ballot, these two stand out, and Skelton hopes to drown the winner financially. He does have a long record of winning big in this district, dating back to 1976,
Over in Kansas, the marquee race is the Republican nomination to succeed Sen. Sam Brownback, who’s running for governor. Two incumbent Republican House members, Todd Tiahrt and Jerry Moran, are locked in a relatively close contest dominated by Tiahrt’s efforts to play the “true conservative” card against front-runner Moran. While Tiahrt has been endorsed by Sarah Palin and Tom Tancredo, Moran has countered with his own endorsement from Jim DeMint, and by becoming a charter member (along with Tiahrt) of the House Tea Party Caucus. Geography may matter a lot in this race; Moran’s expected to do well in his central-west Kansas district, and Tiahrt in his Wichita-based district. The key could be performance in the 3rd district that includes socially moderate Kansas City suburbs, where Moran’s reputation for grinding his teeth a bit less than Tiahrt on issues like abortion could actually help him.
There are competitive Republican primaries in both the Moran and Tiahrt districts, with the latter featuring a long-shot Democratic chance at a pickup thanks to a strong, well-financed candidate, Raj Goyle. In the state’s one current Democratic district, Stephene Moore is trying to succeed her husband, retiring Rep. Dennis Moore, and in the Republican primary, establishment favorite Kevin Yoder, with a big financial advantage, is trying to hold off former State Rep. Patricia Lightner, a favorite of anti-abortion activists.
On Thursday in Tennessee, the big race is the Republican contest for governor (Democratic incumbent Phil Bredeson is term-limited), with the deep pockets of Knoxville Mayor Bill Halsam helping him maintain a lead over Chattanooga-based Rep. Zach Wamp and Lt. Gov. Ron Ramsey.
With all three of the leading candidates hailing from East Tennessee, Haslam’s heavy spending could vault him to a big lead in the middle and western sections of the state. The other two candidates appear to be willing to do just about anything to get free media and seize the coveted “true conservative” mantle. Wamp had to backtrack a bit after suggesting that he’d be willing to push secession of his state if health reform isn’t repealed. And Ramsey weighed in against construction of an Islamic community center in Mufreesboro, suggesting that the First Amendment might not apply to Muslims on grounds that Islam is “a cult.” Yee-haw.
Democratic candidate Mike McWherter, son of former Democratic governor Ned McWherter, awaits the winner of the GOP nomination.
Ed Kilgore’s PPI Political Memo runs every Tuesday and Friday.
Just the other day I was wondering if it was a sign of hard times that movies and television shows seem to be featuring obscenely wealthy people, even more than is usually the case. Similarly, it seems like there are an awful lot of people running for office this year who have personal money to burn, having clearly done very well financially even as their fellow-citizens suffered.
I still can’t prove my theory about movies and television, but according to a well-researched Jeanne Cummings article in Politico, this is indeed a very big year for self-funding candidates:
About 11 percent of the combined $657 million raised by all 2010 candidates has come in the way of self-financing — nearly double the 6 percent measured at the same juncture in the 2006 midterm, according to the Campaign Finance Institute.Of the $134 million raised by all Republican House challengers as of June 30, a whopping 35 percent of the cash came from the candidates’ own bank accounts, the analysis found. Among Democrats, the percentage of self-made donations was just 18 percent.
If such spending stays on course, the Institute’s Executive Director Michael Malbin expects the GOP challengers’ field to eclipse the 38 percent self-financing high-water mark set by Democrats in 2002. “This is or is near a record,” he said.
Much of Cummings’ article focuses on the relatively low success rate of self-funded candidates in prior elections, and explores different reasons for that phenomenon, from lack of self-discipline to specific issues over how the candidate got rich to begin with. Several well-known candidates this year could have some of those issues:
Ohio businessman Jim Renacci, who is challenging freshman Democratic Rep. John Boccieri, for example, is expected to be attacked for going to court to avoid paying taxes on $13.7 million in income.In the California Senate race, Republican Carly Fiorina, former head of Hewlett-Packard, is being criticized for laying off thousands of workers and taking a $42 million golden parachute.
[Florida Senate candidate Jeff] Greene is coming under fire for the way he made millions off the subprime mortgage meltdown. Those criticisms could be especially powerful in a state hit hard by foreclosures. And his relatively thin connections to Florida and prior celebrity lifestyle in Los Angeles — Mike Tyson was the best man at his wedding — are also expected to be used to paint him as an unsuitable senator for the Sunshine State.
And in Connecticut, [Senate candidate Linda] McMahon is trying to finesse using the wealth from her WWE enterprise while still distancing herself from the scandals — from steroids to sexual harassment — that have plagued the professional wrestling industry.
But as Cummings makes plain, rich candidates invariably claim they’ll be independent because they aren’t spending anybody else’s money, and a lot of voters buy it. It’s another good argument for public financing of campaigns, but until such time as that reform is enacted, there will be plenty of people who look in the mirror one fine morning, see a future governor, congressman, senator or president, and decide to share their resplendence with the rest of us.
Anyone who has been active in politics since the prediluvian era of the 1990s can probably remember a time when a central event of every weekday was the arrival on the fax machine of The Hotline, once the Daily Bread of the chattering classes.
You can revisit those days–or, if you are younger, discover them–via a long article at Politico by Keach Hagey that examines The Hotline’s past, present and future in some detail. It certainly does bring back memories:
Howard Mortman, a former columnist and editor at The Hotline, remembers the first time he saw the process — a blinking frenzy of subscribers dialing in by modem, one by one, to get their pre-lunch politics fix.
“We would publish at 11:30, and you could go downstairs and see the lights flicker as people downloaded The Hotline from the telephone bulletin board,” he said. “At that time, in 1995, that was cutting-edge technology.”
Today, The Hotline is still putting out its exhaustive aggregation of cleverly titled political tidbits at 11:30 a.m., though subscribers hit a refresh button instead of a fax number to get it. But the sense of cutting-edge technology and unique content is gone, eclipsed by an exponentially expanding universe of political websites, blogs, Twitter feeds, Google alerts and mobile apps that offer much of what a $15,000 annual office membership to The Hotline offers — but faster and for free.
In effect, Hotline was the first “aggregator,” and as a result was an exceptionally efficient and even cost-effective way to obtain political news at a time when clipping services were the main alternative. And for all of Hotline’s gossipy Washington insider attitudes, it did cover campaigns exhaustively, from coast to coast, in a way that was virtually unique at the time.
If you are interested in the process whereby The Hotline has struggled to survive in the online era, or in the cast of media celebrities who got their start there, check out the entire article, with the appropriate grain of salt in recognition of the fact that Politico views itself as a successor institution.
The takeaway for me, though, is the reminder that for all the maddening things about blogs and online political coverage generally, it’s really remarkable how much is now available to anyone, for free, 24-7–material that is shared by the DC commentariat and, well, anybody who cares to use it. In The Hotline’s heyday, its subscribers (concentrated in Washington but scattered around the country) really did represent a separate class with specialized access to information that created and sustained a distinct culture.
If you have money to burn, there are still paywalls you can climb to secure a privileged perch from which to observe American politics, just as you can obviously learn things living and working in Washington or frequenting its real or virtual watering holes that wouldn’t be obvious to others. But we have come a long way. And it’s actually wonderful that the entire hep political world no longer comes to a stop shortly before noon, in some sort of secular Hour of Prayer, in anticipation of The Word rolling off the fax machine.
I keep seeing that chart that shows how employment declines in the current recession are so much worse than in past ones. You know, this one:
On many dimensions, of course, the current recession is much worse, but this chart has always seemed funny to me. And after reading Paul Krugman mock the idea that the recessions of the 1970s and 1980s were at all comparable, I decided to make my own damn chart. Because the above chart looks at employment levels, which are affected by labor force growth, I decided to look at employment rates instead (subtracting the unemployment rate for each month from 100). Because the composition of the labor force has also changed over time (lots more married women, most notably), I decided to confine to white men ages 20 and up. And because it’s unclear to me what “peak” is used in this chart (see the vague note at the bottom of Rampell’s chart) and since the relationship of the NBER business cycle peak to the unemployment rate involves a lag, I decided to measure from the peak employment level. Got all that? Here’s my chart:
I’ve labeled the lines the same way that Rampell’s chart is labeled, by the recessions that followed each employment rate peak. The figures are from BLS and are based on their seasonally adjusted series.
This approach makes clear why people were disappointed by the “jobless” recoveries from the recessions of the early 1990s and 2000s, which were no faster than after the much more severe recession of the early 1970s (though of course, the declines in employment were much smaller to begin with). More to the point, it also shows that while the current recession still looks bad, bad, bad, the decline in employment is comparable to the decline during the double-dip recession, which is apparent from the “1980” line. That’s not the most fantastic news of course, but it’s worth noting. Unfortunately, I doubt this is the chart you’ll see others use and update as things evolve in the next few months.
I know it probably seems like this year’s primary season has been unbearably long. But as July comes to a close, there are 23 state primaries (plus runoffs in, so far, Georgia and Oklahoma, and a special election in West Virginia) still ahead. Next week’s schedule includes primaries on August 3 in Kansas, Michigan and Missouri, and on August 5 in Tennessee. Most of the action is on the Republican side, except in Michigan. Kansas has a close Republican Senate primary and two competitive GOP House contests; Missouri has two big Republican House primaries; and Tennessee has a close three-way Republican gubernatorial contest. In Michigan, both parties have very complex and competitive gubernatorial primaries (including that rarest of phenomena, a Republican candidate campaigning as a moderate), and there’s another strong challenge to Democratic Rep. Carolyn Kilpatrick.
In the chattering classes, there’s been considerable discussion the last few days about Democratic efforts to improve morale, particularly a DCCC memo that denies Republicans have much of a chance of taking over the House. FiveThirtyEight’s Nate Silver mocked the memo as making slopping assumptions about the number of seats “in play” and also taking for granted four takeovers of Republican-held seats that are far from certain. RealClearPolitics’ Sean Trende takes a somewhat different tack, and concludes that Republicans’ prospects in November could be better than in 1994, because their goal is simply to take back two-thirds of the House seats they controlled prior to 2006. (On a different front, Stu Rothenberg of Roll Callaccused Democrats of trying to rationalize likely House losses as attributable to factors beyond their control, which provoked me to respond).
There’s lots of fresh polling data. In California, PPP and PPIC (Public Policy Institute of California) have new statewide surveys out, and both show Democrats Jerry Brown and Sen. Barbara Boxer maintaining steady if relatively narrow leads. PPP has Brown leading Meg Whitman 46-40, while PPIC shows him up 37-34 with a big (23 percent) undecided vote. In the Senate race, PPP shows Boxer increasing her lead over Carly Fiorina by 6 points since the June 8 primary. She’s now up 49-40, and just as importantly, has a significantly better approval disapproval rating than Fiorina (Boxer’s is 44/46; Fiorina’s is 28/40). PPIC places Boxer’s lead at 39-34, with, again, a high-undecided rate of 22 percent.
A new Mason-Dixon poll of NV shows Harry Reid and Sharron Angle in a dead heat; Reid leads 43-42, with the favorable-unfavorable ratios of both candidates also being very similar (Reid: 38-51; Angle: 38-47).
Two new surveys in the under-reported Senate race in New Hampshire show Republican front-runner Kelly Ayotte with a significant but shrinking lead over Democratic Rep. Paul Hodes. PPP now has Ayotte up 45-42; a University of New Hampshire poll shows her leading Hodes 45-37.
Last week PPP created a buzz with a poll showing Democrat Alex Sink taking the lead in Florida governor’s race thanks to a toxic Republican primary between Attorney General Bill McCollum and former hospital chain magnate Rick Scott. Now Quinnipiac has a new survey showing both McCollum and Scott basically tied with Sink, with independent Bud Chiles in double-digits and a very large undecided vote.
And Michigan-based EPIC-MRA has a survey out of both parties’ gubernatorial primaries in Michigan. On the Democratic side, the poll shows labor-backed Lansing mayor Virg Bernero holding a 40-32 lead over state legislative leader Andy Dillon. Among Republicans, EPIC-MRA shows a very close three-way race, with former Gateway exec Rick Snyder, who has been openly appealing for Democratic and independent crossover votes, at 26 percent, while Attorney General Mike Cox is at 24 percent and congressman Peter Hoekstra at 23 percent; the latter two candidates have been battling for the Tea Party/”true conservative” vote.
Ed Kilgore’s PPI Political Memo runs every Tuesday and Friday.
In an interesting argument over at OpenLeft about the biggest mistake recently made by Democrats, Chris Bowers suggests that fighting Republican efforts to gut the right to filibuster back during the “nuclear option” debate of 2005 had truly fateful consequences:
[N]ot allowing Republicans to destroy the filibuster back in 2005 is the biggest mistake made by not only President Obama, but by the Democratic trifecta as a whole (and, I admit, my biggest mistake too). This would have resulted in a wide swatch of changes, including a larger stimulus, the Employee Free Choice Act, a better health bill (in all likelihood, one with a public option, and completed in December), an actual climate / energy bill, a second stimulus, and more. If Democrats had tacked on other changes to Senate rules that sped up the process, such as doing away with unanimous consent, ending debating time after cloture is achieved on nominations, eliminating the two days between filing for cloture and voting on cloture, and restricting quorum calls, then virtually every judicial and administration vacancy would already be filled, as well.
I agree with the general argument that Democrats who got all nostalgic about Senate traditions in 2005 when Republicans were threatening to eliminate filibusters against judicial nominations were not thinking strategically. In particular, those who cheered the Schoolhouse Rock-inspired “Phil A. Buster” ads run by the progressive Alliance for Justice would now probably cringe at the memory.
But for the record, it’s important to remember what was actually going on in 2005, in the Republican effort to force Senate floor votes on Bush judicial nominations. The GOP argument was not against filibusters tout court, but against judicial filibusters. And their argument was that such filibusters were unconstitutional on grounds that they violated the provisions requiring Senate advice and consent for judicial nominations. Indeed, the “nuclear option” they threatened was simply a ruling by the vice president, as presiding officer of the Senate, that Rule XXII governing the terms for ending debate was unconstitutional with respect to judicial nominations. Ending filibusters altogether was never on the table, barring some see-you-and-raise-you Democratic tactic of offering Bush his judges in exchange for a more radical step towards majority rule in the Senate, which was never seriously contemplated.
Sure, Republicans have had some fun over the last couple of years quoting Democrats who made pro-filibuster comments in 2005, and it’s true that some Democrats didn’t try very hard back then to make the specific case for judicial filibusters (a case that could have been made on grounds that lifetime appointments to the federal bench require greater Senate scrutiny than the routine legislation that Republicans now routinely block, creating a virtual 60-vote requirement for Senate action). But Democrats need not spend too much time regretting the failure to take advantage of an opportunity that never really existed in 2005.
At CQ today, Roll Call columnist and election handicapper Stu Rothenberg has a piece today complaining about Democrats who are arguing that it was inevitable all along that they’d have a bad midterm outcome, regardless of the economy or other objective developments.
I’m not sure which “Democrats” Rothenberg’s talking about, since the only person he cites who believes the economy is irrelevant to the midterms is Joe Scarborough.
But while I don’t personally know anyone who thinks the economy isn’t going to be a drag on Democratic performance, in burning down this straw man, Rothenberg goes too far in dismissing structural factors that were going to make 2010 far more difficult for Democrats than 2008 no matter what Barack Obama did or didn’t do.
Since Rothenberg’s entire argument is framed in terms of House seats Democrats are likely to lose, the obvious structural factor to keep in mind is the historic tendency of the party controlling the White House to lose House seats in midterms. Stu acknowledges that, but points out that the level of losses varies (of course it does) and also points to 1998 and 2002 as years the ancient rule of midterm losses didn’t apply. That’s fine, though anyone citing those two years as relevant should probably note that the former year came in the midst of the first impeachment of a president since 1867, while the latter year came after the first attack on the continental United States since 1814. At any rate, while most Democrats early in the Obama presidency hoped the party would overcome the heavy weight of history, few predicted it as likely.
But the second structural factor is one that Rothenberg does not mention at all: the very different demographic composition of midterm versus presidential electorates, which is especially important this year given the high correlation of the 2008 vote with age (at least among white voters), and the heavy shift towards older voters in midterms. As I like to say, this means that Democrats were in trouble for the midterms the very day after the 2008 elections. That doesn’t mean everything that happened since doesn’t matter, by any means, but it does suggest pessimism about 2010 and a corresponding optimism about 2012, when the 2008 turnout patterns are likely to reemerge or even intensify.
Finally, in this kind of discussion of House “gains” and “losses,” it’s important to remember that the entire U.S. House of Representatives is up for reelection every two years. So the position of the two parties nationally is reflected by the absolute results, not which party “gains” or “loses” seats from the prior election. If Democrats hang onto control of the House, it’s a Democratic victory (albeit a much smaller one than in 2008) because they will have won a majority of seats (and presumably a majority of votes for the House nationally), and it’s not a Republican victory but instead a smaller defeat. House gains or losses are relevant to trends, of course, but shouldn’t dictate characterization of specific election results.
In other words, Rothenberg’s effort to anticipate and preempt Democratic spin about the November elections is all well and good, but there a lot of questionable assumptions about this election that need to be examined–most definitely the idea that any significant Republican gains mean the country has fundamentally changed its mind since 2008. That’s a “spin” that Republicans are already avidly promoting every day.
The Congressional Budget Office’s latest fiscal forecasts confirm that America faces a fiscal emergency. The national debt is projected to double as a share of GDP from 32 percent in 2001 to 66 percent next year. Then it could rise to 90 percent by the end of this decade, and reach 146 percent by 2030. At that point, we’d be spending about 36 percent of tax revenue to finance our debts, up from 9 percent today.
The nation’s yawning fiscal gaps, driven largely by entitlement spending, can’t be closed by a combination of economic growth and tax hikes. When it comes to government spending, there will be blood. Only not now: At the federal level at least, unemployment will have to fall dramatically, probably to around 5 or 6 percent, before real discipline can be imposed on public spending. Otherwise a premature turn to austerity could plunge the national economy back into recession.
Let’s stipulate that Republicans are consummate hypocrites when it comes to fiscal discipline. On taking power in 2000, they let budget controls lapse, spent the hard-won surplus they inherited on tax cuts, charged a trillion-dollar prescription drug entitlement to the nation’s credit card, and launched the very Wall Street bailout they now have the temerity to denounce.
And now GOP leaders insist that the Bush 2001 and 2003 tax cuts be extended to the wealthy, not just middle class families as President Obama has proposed. Since they offer no offsetting spending cuts or tax hikes, this would add between $2-$3 trillion to the national debt over the next decade.
Okay, Republicans have no shame, and Democrats are paragons of fiscal rectitude by comparison. Nonetheless, Democrats before long will have to commit what many regard as unnatural acts: make deep cuts in public spending.
For a sobering glimpse of what the future might hold, look at California. Gov. Arnold Schwarzenegger yesterday declared a state of emergency in a bid to force state legislators to pass a budget aimed at closing a $19 billion shortfall.
The Golden States deficit, according to Reuters, “is 22 percent of the $85 billion general fund budget the governor signed last July for the fiscal year that ended in June, highlighting how the steep drop in California’s revenue due to recession, the housing slump, financial market turmoil and high unemployment have slashed its all-important personal income tax collection.”
Democratic lawmakers nonetheless have blocked Schwarzenegger’s proposals for deep spending cuts, leaving the gubernator to threaten another round of unpaid furloughs for state workers. California may also be forced to issue IOUs instead of payments to vendors if the legislature fails to pass a budget soon. And the state is trying to renegotiate generous pension schemes for state employees.
The California crisis should be a wake up call for Democrats in Washington. A major fiscal retrenchment is coming, and they need to be better prepared for it than their counterparts in Sacramento.
Somehow the summer of 2010 has become the winter of liberals’ discontent. The blogosphere and MSNBC are rife with handwringing liberals wondering, “Is Barack Obama becoming a new Jimmy Carter”? Though President Obama’s sliding approval ratings and high unemployment should concern all Democrats it is, nevertheless, time for liberals to park the Volvo, put down their collective lattes, turn off NPR and repeat after me: Barack Obama is not Jimmy Carter.
FOX, RedState, and the New York Post are truly worthy of this lame and totally unimaginative analogy. Recently, however, the HuffingtonPost, Guardian, and even Zbigniew Brzezinski have parroted this metaphor. Historical analogies might make someone appear knowledgeable but they are too often used as a substitute for actual thinking. Repeat after me: Jimmy Carter and Barack Obama are NOT like peas & carrots.
Unlike Obama, Jimmy Carter governed at the end of a durable liberal political paradigm: the New Deal era. Since the onset of the Great Depression liberals had so ruled the political landscape that even Dwight Eisenhower accepted and even expanded upon the New Deals welfare state. Indeed, when Barry Goldwater ran upon an anti-New Deal platform in 1964, he garnered less than 40 percent of the vote.
By the late 1970s, New Deal-style solutions of deficit spending and government programs had not only grown stale, they simply no longer addressed the problems confronting the nation. Reagan was hardly right on all issues, but targeted tax cuts combined with defense spending did help spark real and lasting economic growth. Similar to the seventies, today Reagan’s pragmatic conservatism has morphed into a rigid and inflexible ideology demanding reflexive and obsequious political kowtows regardless of circumstance.
While Reagan deserves much credit and liberals sowed the seeds of their own demise, significant demographic forces enabled conservatives to oversee a political realignment. It was the offspring of New Deal Democrats who elected Reagan. In moving from the industrial Midwest and Northeast to the Sunbelt, they shaped and formed Reagan’s base. From Southern California, Arizona, and Texas to Florida, millions of Americans left regions dominated by unions and white ethnic Democratic political machines for the decidedly libertarian West and socially conservative South. Thus, when Carter assumed the presidency the nation had literally undergone a seismic demographic shift, which gave Reagan an opportunity for political realignment.
Adding to the altered political geography was the legacy of 1968. In that terrible year Americans not only witnessed the assassination of MLK & RFK, it was the time during which a generation of liberals and leftists fell out of love with America. Soured by the Vietnam War, assassinations, and a white political backlash, liberals were alienated and distrustful of Middle Americans.
Unlike the 1970s, the political zeitgeist and demography are on progressives’ side. Whether it is Hispanic population growth in the Southwest and Upper South or a generation of young Obama Democrats, 2010 America ain’t 1980, 1994, or even 1936 America.
Demography, ideas, and political metrics hardly assure victory. The Republicans could take the House and even engineer a long-shot defeat of Obama in 2012. But that political success, like Democratic victories in 1970, 1974, and 1976, are short-term hiccups delaying an inevitable political realignment.
It is time, however, for progressives to move beyond the past. Indeed, with all due respect to Bill Clinton and Lyndon Johnson, liberals last enjoyed real and durable presidential leadership and success when Bing Crosby’s “White Christmas” was at the top of the charts, “Meet Me in St. Louis” was a box office smash, and the St. Louis Browns sent the one-armed Pete Grey to patrol centerfield.
Truman, JFK, LBJ and Clinton provided an occasional oasis and even some substantial victories but today’s liberal distress only reveals we don’t know how unfamiliar we are with success. President Obama’s passage of a stimulus package, national healthcare, Wall Street reform, and a muscular and revised Afghanistan policy are the very definition of achievement. Liberal achievement has always prompted a conservative pushback. Similar to Obama’s agenda, Social Security, the Tennessee Valley Authority, and Medicare were not universally embraced upon their enactment.
Like the New Deal or any liberal era, hard work and political organization are a must if Democrats hope to safeguard and build upon their achievements. It is time for liberals, however, to stop the self-doubt and dare I say malaise (yes, I used that word—as a reverse jinx). We have an eloquent and inspiring leader in Barack Obama who heads up an extraordinarily savvy political operation. Though only Bing Crosby might recognize it liberalism is back. Repeat after me: progressives get shit done.
Yesterday J.P. Green did a
In discussions of the energy bill this summer, talk focused on a price for carbon. This is a vital component in any legislation that would force companies to reduce emissions, either by becoming more efficient or substituting cleaner fuels. But that’s only realistic if cleaner alternatives, like biofuels, are available to replace dirty fossil fuels. Whether or not cap-and-trade passes this year, biofuels should play a key role in our new energy economy, but we need to reassess federal support to allow for more diverse and higher performing biofuels.
Yesterday’s primaries in Kansas, Michigan and Missouri didn’t get a whole lot of national attention, but they produced some interesting results.
Anyone who has been active in politics since the prediluvian era of the 1990s can probably remember a time when a central event of every weekday was the arrival on the fax machine of The Hotline, once the Daily Bread of the chattering classes.
The Congressional Budget Office’s latest fiscal forecasts confirm that America faces a fiscal emergency. The national debt is projected to double as a share of GDP from 32 percent in 2001 to 66 percent next year. Then it could rise to 90 percent by the end of this decade, and reach 146 percent by 2030. At that point, we’d be spending about 36 percent of tax revenue to finance our debts, up from 9 percent today.
