Tag Archives: political parties

OFA and Communications

Posted on by
1

President Barack Obama and his fellow Progressives are reorganizing their Obama for America group into a tax-exempt group to be called Organizing for Action, whose purpose is to generate grass roots support for President Barack Obama’s policies and goals over the next four years.  This is relatively old news; John McKinnon and Colleen McCain Nelson have one description of this in a recent Wall Street Journal article.

The problem with this, IMNSHO, is not so much the potential for this group to facilitate Obama’s working his will on our nation.  It’s more centered on the Republicans’ reaction to it.  As McKinnon and Nelson write,

At a House GOP retreat this week, Republican leaders discussed their concern that Mr Obama’s group would be used to generate grassroots activism for Democratic issues.

Well, duh, as the kids say.  You guys are incompetent communicators.  Instead of whining that the Progressives are planning on talking to folks and generating grassroots support for their policies and goals (how unfair is that!?), you should be asking yourselves why you’re not talking to folks and generating grassroots support for your own policies and goals.

Then,

Republicans also say Mr Obama could overplay his hand by appearing to be more focused on campaigning than governing.  A spokesman for Senate GOP leader Mitch McConnell [R, KY] said the OFA announcement is “the next step” in a pattern of the administration campaigning while in office that Mr McConnell has criticized repeatedly.

Catch up and pay attention, Mitch.  That “campaign instead of governing” plaint was a major beef of Republicans all last summer and fall—and before.  Nobody cares.  Except the Progressives, for whom it’s been working for the last few years.

Quit bellyaching and start talking and start governing.  You control the House of Representatives.  You’re a powerful minority in the Senate.  Start acting like it.

Progressive Policies and the Poor

Posted on by
Reply

Thomas Sowell, writing in the National Review, had some thoughts on the impact of modern Liberalism on the welfare of blacks in the US.  I think they apply to all minorities, to whites, to our poor generally.

Severe restrictions on building housing in San Francisco have driven rents and home prices so high that blacks and other people with low or moderate incomes have been driven out of the city. The same thing has happened in a number of other California communities dominated by liberals.

And

Liberals try to show their concern for the poor by raising the minimum wage.  Yet they show no interest in hard evidence that minimum-wage laws create disastrous levels of unemployment….

And

The black family survived centuries of slavery and generations of Jim Crow, but it has disintegrated in the wake of the liberals’ expansion of the welfare state.  Most black children grew up in homes with two parents during all that time, but most grow up with only one parent today.

And

Liberals have pushed affirmative action, supposedly for the benefit of blacks and other minorities.  But two recent factual studies show that affirmative action in college admissions has led to black students with every qualification for success being artificially turned into failures by being mismatched with colleges for the sake of racial body count.

Sowell summarizes the matter starkly:

In all these cases, and many others, liberals take positions that make them look good and feel good—and show very little interest in the actual consequences for others, even when liberal policies are leaving havoc in their wake.

The party of Jim Crow may be attempting to correct its past.  It is, in fact, failing miserably.  Modern Liberals give so little thought to the 50 years of empirical evidence defining the consequences of their actions that I have to conclude that they’re well aware of those consequences.  One of those consequences, flowing from the poverty enforced maintained by their actions, is the continued dependency of our poor on the largesse of the Modern Liberals in government.

That’s not just petty ego stroke, that’s political power.

A Debt Ceiling Plan

Posted on by
Reply

Keith Hennessey, in a Thursday Wall Street Journal op-ed, proposes one, containing three steps.  In essence, they are:

  1. House Republicans…argue for and pass a debt-limit increase combined with present and future spending cuts.  Mr Obama will reject deep spending cuts and accuse Republicans of playing dangerous games with our financial system.
  2. [C]ongressional Republicans…offer Mr. Obama a choice.  He can have a long-term debt-limit increase if he agrees to cut spending, or he can have repeated, short-term increases without spending cuts.  If the president continues to dodge the country’s long-term spending problem, the solution is to force him to ask Congress every few months to give him the authority to borrow more while facing questions about why he refuses to restrain spending.
  3. Congressional Republicans…explain that they will support the first alternative—a long-term debt-limit increase coupled with spending cuts.  They will allow short-term debt increases to occur—but they will not support them.  This means that if Mr. Obama agrees to cut spending, he will get his long-term debt-limit increase and most Republicans would vote for it.  If, however, he refuses to cut spending and instead chooses repeated short-term increases, then he and House Minority Leader Nancy Pelosi would have to ensure that all 197 House Democrats vote aye.

But the Republicans aren’t even talking, that I can see, about passing a bill pairing a debt-limit increase with real spending cuts.  There’s only Speaker John Boehner (R, OH) talking about how there “ought to be” a dollar for dollar exchange.

Which brings me to my second problem with Hennessey’s plan: Republicans remain cowering shamefully on the sidelines, saying nothing at all to their constituents or to their neighboring Democratic Party districts’ constituents about what their plans are and why those (non-existent?) plans are better than the Progressives’ Spend and Tax-and-Borrow plan.  The Progressives already are explaining “why [they] refuse[] to restrain spending.”  And they’re doing so quite successfully, given there’s no response from the Republicans or Conservatives in Congress.

Once again, Republicans and Conservatives are surrendering, without the first part of a struggle, the communications field to those Progressives.  And so they’re surrendering the entire spending and borrowing problem, without any struggle, to the Progressives.  Daniel Henninger, in the same issue of the Wall Street Journal, describes an aspect of this abject failure here.  Read all of it, if you have the stomach.  Note though, that Henninger is describing a mechanism for getting their point of view across.  But there must be a point of view, first.

Americans, Deadbeats, and Bills

Posted on by
Reply

President Barack Obama, the other day, announced that we’re a not a nation of deadbeats; we pay our bills.  What are the facts?

Brett Arends, in a recent Wall Street Journal Market Watch article offers some.

Far from paying our bills, the current generation of Americans—or some of them—have set records for default which probably have no parallel in the history of the human race.  During the last five years, US individuals have walked away from a staggering $585 billion in mortgages, credit card debts and other personal loans.  That works out at about $6,000 per household.

And if the numbers are to be believed, there is probably a lot more to come.

For instance,

According to the Federal Reserve, US household debts peaked five years ago at a gigantic $13.8 trillion.  Since then it has declined to $12.9 trillion—a decline of about 7%.  To put that in context, household debts today still exceed those seen at the end of 2006, near the peak of the bubble.  They are three times what they were in 1998.

The outcome includes

The total debt reduction from the peak, says the Fed, is $954 billion.  Loan write-offs [from those “walk aways”], at $585 billion, account for 60% of that.  In other words…in the last five years Americans have walked away from $3 in debt for every $2 they’ve paid off.

Does all of this make us a nation of deadbeats, though?  Let’s look at some more facts.  Arends notes

[T]his has occurred even while the federal government has bailed out bankrupt financial institutions, and flooded the economy with massive deficits, low interest rates and free money to make it all easier.

The policies have altered the incentives to make it easier to walk away from our debts.  But that’s not all there is to it.

Richard Vetter, in a same-day WSJ op-ed, offers some more facts.

From the mid-17th century to the late 20th century, the American economy grew roughly 3.5% a year.  That growth rate has since declined significantly.  When the final figures are in for 2012, the annual rate of real output growth for the first dozen years of this century is likely to be about 1.81%.

What accounts for the slowdown?  An important part of the answer is simple: Americans aren’t working as much today.  And this trend reflects more than the recession and sluggish economy of the past few years.

This chart, covering the last 65 years, illustrates the matter starkly.

Before continuing, a digression is in order.  Recall a couple of the dates Arends mentioned above.  Today’s household debt is greater than it was during the housing bubble peak in 2006.  At that time, we were already well on the way down in workforce participation, yet the Panic was still two years off.  Today’s household debt is three times what it was in 1998.  1998 is the 65-year peak in Americans’ workforce participation.  Fewer people are working today, relatively, than then, and that has nothing to do with our present economic malaise.

Back to the main program.  Vetter asked why fewer Americans are working today (after all, we have to earn an income in order to pay our debts.  Don’t we?).  After all,

[i]f today the country had the same proportion of persons of working age employed as it did in 2000 [the end of the peak in work force participation], the US would have almost 14 million more people contributing to the economy.  [Aside: so much for those 3-5 million jobs Obama’s policies have so proudly saved.]

It comes back to incentives.  The Obama administration’s Progressive policies encourage Americans to not work.  Some of those destructive policies are these:

Food stamps. Above all else, people work to eat.  If the government provides food, then the imperative to work is severely reduced.  [Food stamp program use] has grown considerably, but especially so in the 21st century: There are over 30 million more Americans receiving food stamps today than in 2000.
The sharp rise in food-stamp beneficiaries predated the financial crisis of 2008: From 2000 to 2007, the number of beneficiaries rose from 17.1 million to 26.3 million, according to the Department of Agriculture. That number has leaped to 47.5 million in October 2012.  The average benefit per person jumped in 2009 from $102 to $125 per month.
… But more is going on here.
Compare 2010 with October 2012, the last month for which food-stamp data have been reported. The unemployment rate fell to 7.8% from 9.6%, and real GDP was rising steadily if not vigorously.  Food-stamp usage should have peaked and probably even begun to decline.  Yet the number of recipients rose by 7,223,000.  In a period of falling unemployment and rising output, the number of food-stamp recipients grew nearly 10,000 a day.

Social Security disability payments. The health of Americans has improved, and the decline in the number of relatively dangerous industrial production and mining jobs should have led to a smaller proportion of Americans unable to work because of disability.  Yet the opposite is the case.
Barely three million Americans received work-related disability checks from Social Security in 1990, a number that had changed only modestly in the preceding decade or two.  Since then, the number of people drawing disability checks has soared, passing…6.5 million by 2005, and rising to nearly 8.6 million today.  In a series of papers, David Autor of MIT has shown that the disability program is ineffective, inefficient, and growing at an unsustainable rate.

Pell grants. Paying people to go to college instead of to work is traditionally justified on the grounds that higher education builds “human capital” that is vital for the country’s economic future.  But a study Christopher Denhart, Jonathan Robe and I did for the Center for College Affordability and Productivity (that will be released soon) shows that nearly half of four-year college graduates today work in jobs that the Labor Department has determined do not require a college degree.  For example, over one million “retail sales persons” and 115,000 “janitors and cleaners” are college graduates.
In 2000, fewer than 3.9 million young men and women received Pell Grant awards to attend college.  The number rose one-third, to 5.2 million by 2005, and increased a million more [one-fifth] by 2008.  In the next three years, however, the number grew over 50%, to an estimated 9.7 million.  … The result is fewer people in the work force.  Meanwhile the mismatch grows between the number of college graduates and the jobs that require a college education.

Extended unemployment benefits. Since the 1930s, the unemployment-insurance system has been designed to lend a short-term, temporary helping hand to folks losing their jobs, allowing them some breathing room to look for new positions.  Yet the traditional 26-week benefit has been continuously extended over the past four years—many persons out of work a year or more are still receiving benefits.

We don’t pay our bills.  But we’re not deadbeats, either; Progressive policies have simply altered the incentives.  It’s the rational (if not moral) choice to go the cheaper route—the route that welfare programs and Progressive excusals incentivize—the route of not working, and “walking away” from our debts.  Even bankruptcy itself has lost its moral stigma.  (That failure is on us, though, not our government.)  Obama is right—we’re not a nation of deadbeats.  But he’d like us to become a nation of government dependents for whom the rational, if not moral, choice is continued dependency.  And that makes it tough for us to pay our bills—individually or as a nation.

Debt Ceiling Negotiations

Posted on by
Reply

President Barack Obama had some thoughts on this in a press conference the other day.  Surprise—I have some thoughts on his thoughts.

Obama said this in response to a question from CBS News‘ Major Garrett on how Obama reconciles his refusal to vote to raise the debt ceiling while a Senator (the raise would be a “leadership failure”) with his current refusal, as President, to negotiate his demanded raise of the debt ceiling:

And, you know, the fact of the matter is, is that we have never seen the debt ceiling used in this fashion, where the notion was, you know what, we might default unless we get 100 percent of what we want. That hasn’t happened.

Actually, we’ve seen this repeatedly in the recent past.  Under Presidents Ronald Reagan and Bill Clinton, for instance, spending cuts (or what passed for them—reductions in the rate of growth of spending) were explicit parts of the deal to raise the ceiling.

Obama then added this:

Now, as I indicated before, I’m happy to have a conversation about how we reduce our deficits further….

There are a couple of things about this one.  One is that bit about being “happy to have a conversation.”  A conversation is an “exchange of thoughts and feelings.”  It’s not a negotiation.  Obama is willing only to engage in idle chit-chat on this subject; he’s not willing to enter into serious negotiation.

The other thing is that nonsense, “reduce our deficits further.”  As a man of Obama’s learned education knows—as his economic advisors in the White House and in his Cabinet know—a reduced deficit is still a deficit, and so it still grows our nation’s debt.  Once again, Obama is unwilling to take our debt seriously.

Obama then concluded his evasion of the original question (he never did address Garrett’s question of how Obama reconciles his Senatorial “No” with his Presidential “Raise it now” demand on the debt ceiling) with this:

But what you’ve never seen is the notion that has been presented so far at least by the Republicans that deficit reduction will only count spending cuts, that we will raise the deficit—or the debt ceiling dollar for dollar on spending cuts.  …what we’re not going to do is put ourselves in a position where in order to pay for spending that we’ve already incurred, that our two options are; we’re either going to profoundly hurt the economy, and hurt middle-class families, and hurt seniors, and hurt kids who are trying to go to college, or alternatively we’re going to blow up the economy.

The first part of that is true.  Having seen the failure of tying reduced spending growth rates to raising the debt limit, the House Republicans now are tying actual spending cuts to raising the debt ceiling.

The rest, though, is exactly what Obama is threatening.  He’s holding out for “100% of what [he] want[s],”  or he’ll blow up our economy.  He’s the one demanding a debt ceiling raise with no strings attached (he’s even called for ceding borrowing authority to him) and refusing to discuss any alternative.  He’s the one who’s said he won’t negotiate at all on the debt ceiling.

Yet, it’s his demand for continued borrowing, for continued expansion of our debt, that is profoundly hurting the economy, the middle class, seniors, the poor (who are notably absent in his “concern” for the welfare of others).   The opposition has already agreed to raise the borrowing limit.  They just want real spending cuts, also, so as to break the DC addiction to spending, and so as to reduce—or even eliminate—the need to borrow more.