No one Cuomo should have all that power
Over the past couple of years, there’s been many people wondering why it is, exactly, that Washington seems so utterly indifferent towards stimulating the economy. Some people have hypothesized that it’s because DC itself is in a bubble of wealth and comfort. Some think it’s because the Republican party, both consciously and less-than, knows that the worse the economy, the better its chances of reclaiming the White House. And then there are those who think the false “structural unemployment” explanation has been bought by players across the spectrum, as it conveniently absolves everyone of responsibility.
While I think each of these arguments holds at least a kernel of truth, I believe Robert Kuttner was closest to the mark with what he wrote in The American Prospect recently, an essay titled “Debtors’ Prison.” Here’s the nub of his argument:
Creditors—the rentier class in classic usage—are usually the wealthy and the powerful. Debtors, almost by definition, have scant resources or power. The “money issue” of 19th-century America, about whether credit would be cheap or dear, was also a battle between growth and austerity.
The creditor class views anything less than full debt repayment as the collapse of economic civilization. In fact, however, debts are often not paid in full. In the 20th century, speculators lost fortunes as dozens of nations defaulted on debts. Several 19th-century U.S. states and municipalities defaulted. Losers in wars and revolutions seldom pay debts. (Those czarist bonds have no value except on eBay.) The Brady Plan of the late 1980s paid bondholders of defaulting Third World debtors at about 70 cents on the dollar so that economic growth could resume.
Sometimes, debts simply cannot be paid. That’s why debtors’ prison was a ruinous idea (except as a deterrent). The real issue is how to restructure debt when it becomes impossible to repay. This is not just a struggle between haves and have-nots but between the claims of the past and the potential of the future.
Another way to put this is that working towards increasing employment and reducing private debt is not in the rational self-interest of people who, for the time being, find themselves doing quite all right in this poor economy. Kuttner focuses here on those who are against shifting the balance of power between debtors and creditors. But the same dynamic is true regarding fiscal policy.
I’m most certainly not an economist, so I’m inclined to look at these issues largely through a political lens. And that means taking into account the dynamics of power. Doing that, it’s not so curious, the continued apathy on the part of the country’s elites towards reducing unemployment. After all, a market where everyone desperately wants a job is one in which employers have supreme leverage. Provided you’re not a retailer suffering from the lack of demand in the population, maintaining this economic status quo is a great way to control the rise of wages.
On the whole, I doubt many people are thinking along these terms quite so explicitly. No one’s sitting in a dark chamber, petting a cat on their lap and chuckling about having the working and middle classes struggling under their boot heel. But this situation does dovetail rather nicely with the kind of ordering of society many have been advocating for years: governments are shedding jobs at a fast clip, thus shrinking “Big Government,” while public services (“entitlements”) that have long been scorned by some are now, it is agreed by both Republicans and many Democrats, simply too expensive to sustain in this environment.
It’s truly a non-partisan affair, too. Check out New York Governor Andrew Cuomo, current heart-throb of the left for his admirable performance ushering marriage equality through Albany; but on issues of economic equality, Cuomo is not your father’s (or his father’s) Democrat. Check out how Cumo plans on fixing the state’s budget — letting a somewhat minimal (if not insignificant) tax on the state’s wealthiest citizens expire on one hand, while, with the other, putting the squeeze on public employees:
Members of New York’s largest union of state employees, in a begrudging acknowledgment of the increasingly hostile mood toward public workers, have agreed to accept major wage and benefits concessions sought by Gov. Andrew M. Cuomo.
The union, the Civil Service Employees Association, announced late Monday night that its members had voted by about 60 percent to 40 percent to approve the contract agreement that the governor and union leaders struck in June.
The ratification was a critical victory for Mr. Cuomo, a Democrat whose plan to close the state’s budget gap relied in large part on a bet that state employees would be willing to stomach a freeze on wages and an increase in the cost of health benefits in return for safeguarding their jobs.
The union’s president, Danny Donohue, said in a statement: “These are not ordinary times, and C.S.E.A. worked hard to reach an agreement that we believed would be in everyone’s best interest. C.S.E.A. members agree that this contract is reasonable and responsible for the long term and shows that C.S.E.A. members will do what is right for the good of all New Yorkers.”
In and of itself, there’s nothing wrong with public employees taking a bit of a hit during rough economic times for the state. Nothing at all. But I can’t help raising my eyebrows when I see what this juxtaposition says of Cuomo’s priorities. Bringing this back to power, however, it’s not really so surprising. As the article says, people are fearful of losing their jobs right now; Cuomo has jammed the unions between that sliver separating a rock and a hard space, and faced with the prospect of joining the millions of unemployed, there’s likely not much to which they won’t agree.
(x-posted at Flower & Thistle)
To be fair to state-(or city-) level politicians, reducing taxes on the wealthy does help their economy. The cost of exit isn’t high enough to make ’em pack up their legal residence and move to Vermont.
This is different from federal level taxes, of course. Cost of exit from the country is a tad bit higher.Report
This is quite true. When we next relocate, taxes are one of the things we’re going to be looking at (as a component of cost-of-living). However, we’re not going to relocate to Australia if the federal government raises our taxes. It might affect our work habits, though.Report
I think this is sometimes the case. I don’t think it’s the case for the state of New York.Report
Yes, there’s this place called New York City. Rich people tend to like it. A lot. Obviously, one can make the argument that yes, lower income taxes might help somebody deciding between suburban Wisconsin and suburban Illinois and I’d question that (the truth is, the vast majority of people just live where they can get a job), but somebody who has a penthouse overlooking Central Park isn’t going to book for New Hampshire.Report
No.
But they might buy a place in New Hampshire and make it their legal residence. It’s a hassle, but I’m sure its been done.Report
What’s-his-name, that awful, awful candidate from 2004, did a thing with a boat recently.
Heck, and he’s a democrat.Report
I would agree that New York is safer than most, but one should never take one’s milk cows for granted. Billionaires have been known to live in Omaha, and bankers in North Carolina. Rich people are one of New York City’s biggest assets.
I have no position on what Cuomo is doing. I’m just thinking abstractly here. And my attitude is perhaps disconnected from the coasters: I think cost of living matters a great deal. I might think that view would change if we were making in the seven figures, but six figures don’t seem to have changed it {shrug}.Report
A lot of high earners have minimal choice in where they live, however for those that do the issues of state taxation loom large. Maybe actually more so for corporate income taxes.Report
The whole line of thinking implies that the reduction of taxation on high-earners was implemented because they were fleeing their residencies or setting up shell homes so much as to deplete the states’ coffers and population (of wealthy individuals) to such a degree that the lowering was deemed necessary.
I’m pretty sure that’s not what happened.Report
“FORD TO NEW YORK: DROP DEAD”
(2nd greatest NYC headline of all time)Report
I think so too! Do you put “Headless Body found in Topless Bar” at #1? That’s my favorite.Report
This had nothing to do with taxes on the rich being too high.Report
Mid-twentieth exodus to suburbia was overdetermined to be sure. But preferential tax treatment is one of the reasons SW Connecticut got rich and NYC went broke in that time.Report
But I don’t see how it can be important when it wasn’t decisive. If everything had been the same — oil shocks, stagflation, rioting, etc. — but tax rates for the top had been at their level today, do you really think the result would have been Bill Simon saying, “You know what, Ger? I may be a free market fundamentalist who has long loathed unions of any and all kinds, but — Hell, let’s give ’em a pass this time!”Report
But I don’t see how it can be important when it wasn’t decisive.
This is often the case when something occurs for a multitude of reasons. A lot of factors contribute, but no one thing is decisive. Whether something that contributes contributed enough to be important is something of a different question, and I suspect where you and Kolohe are coming down differently.Report
The Kuttner quote was interesting. For me, it underscores the recklessness of the Demo’s during the whole debt limit debacle.
Some debts are repaid, others aren’t. But, the world’s financial system has structured itself on the premise that US Treasuries are credit-riskless. Because of the track of Demo-intended expenditures, that premise is in substantial jeopardy now. If somehow that premise fails, it’s not clear what if anything might be able to take it’s place.
Compounding this, there is also the fact that we intend to continue net borrowing for the forseeable future as well. Therefore, inflation isn’t really a plausible option either.
That’s why the lib talking points about stimulus are myopic to say the least.Report
I like your post. Now let me tell you about how the Dems are going to ruin the country and the Reps are our only possible saviors.Report
Doesn’t the GOP have a proven track record of not being
tax anddeficit spenders? Heh! Not so much! For some reason the simple observable fact that deficits increase disproportionately under GOP Rule seems to be easily forgotten by GOPers.ReportI don’t know why that should be such a difficult proposition for either one of you. It’s a pretty basic fact of financial reality that the world financial system is built on the premise that US Treasuries are credit-riskless. And Demo fiscal policy has shaken that premise to the foundation.
That’s not the only problem in the economy, but it’s one we could do without as we try to work our way out of Demo unemployment.Report
If you could lose your “Demo” obsession Koz you could come off as pretty coherent. Fiscal policy has been set by both parties, the deficit has been run up both both parties. I’ll even be charitable and blame the current credit shaking on both parties though that ones somewhat of a stretch. Trying to blame this entirely on one party is a real knee slapper.Report
“If you could lose your “Demo” obsession Koz you could come off as pretty coherent.”
That’s a shame North, ‘cuz the emphasis on Demos is for your benefit (among others). It’s a shame that as near as I can see you haven’t given any consideration to your own errors and culpability for what’s gone wrong in the economy, especially given what’s happened over the last six months or year or so.
Instead, it’s all about short term political posturing, ie, “When is Obama finally gonna get tough with the Republicans?” and the usual crap. Maybe today, maybe next week, maybe next month, whatever it is, that’s not the nature of the problem, it’s not the nature of the solution.Report
I’ll ponder and discuss my culpability for the last 6 months Koz if you’ll do the same the time span between the years 2000 and 2008 along with a meditation on how much the events of that particular period shape the issues of our current affairs. I’d go further back (Regan I hear was one hell of a debt builder) but frankly I wasn’t part of the polity prior to 2000 and things seemed in tolerable order when I moved in.Report
Quit living in the past! We’re talking about the future!Report
No North, it’s about you and the other libs taking accountability for the policy failures of the Left for the past thirty years, not just the past one. But, where the reality of their failure has been made manifest beyond all doubt this year.
Or even sooner in some cases. How long ago was it that you assured us that the essential bankerness of the Democratic party was an operational guarantee against Treasuries being downgraded? Eight weeks maybe?
If less were at stake I’d laugh. Especially wrt the intramural Left argument, “Oh I’m a neo-lib, I’m not one of those bleeding heart spendthrifts.” Like that’s done anything for anybody.Report
> No North, it’s about you and the
> other libs taking accountability
> for the policy failures of the Left
> for the past thirty years, not just
> the past one.
I will sing my old song one more time.
1980 to 2010. In that stretch of time, which parties controlled which Houses of Congress and the Presidency? How was GDP?
The 103 was blue across the board. The 108th and 109th were red across the board. Everybody else we had mixed results.
How does GDP track to which party is in power?
Please show your work.Report
“1980 to 2010. In that stretch of time, which parties controlled which Houses of Congress and the Presidency?”
The Demos part of the time, the GOP part of the time. But the lib-Demos have been the proponents of excessive government expenditures and regulatory overreach the whole time. This applies during the period of the George W Bush living in the White House as well, btw. For all the complaints about Medicare Part D, it represents the enactment of a longtime Demo entitlement. And fwiw, none of their plans to implement it were funded any different.
(“On the credit card” is a phrase no lib should ever use. Their understanding of its ramifications is very very low)
Now, we are in a situation where our path of expenditures is clearly unsustainable and causing severe adverse consequences for the larger economy. So it’s appropriate for libs to come to grips with their desire to expand the culture of dependency and the ever-more government spending that goes with it, and make changes as appropriate.
Once that happens, we can triage the welfare state as it currently exists in a bipartisan way. And not just bipartisan between Demo’s and GOP but between libs and conservatives as well which is actually more important imo. Then with a little luck there is the opportunity to restore prosperity to America and still provide human-interest services to our people that doesn’t feed the welfare state and feed the culture of dependency, to the extent that we can afford them.Report
So you’re saying that every time conservatives and the GOP have run up the debt or violated their own principles it’s been because they were actually liberal skinwalkers or something?Report
> But the lib-Demos have been
> the proponents of excessive
> government expenditures
> and regulatory overreach
> the whole time. This applies
> during the period of the George
> W Bush living in the White
> House as well, btw.
When it happens on the Democrats’ watch, it’s the Democrats’ fault. When it happens on the GOP’s watch – when they control both houses of Congress *and* the Presidency – it’s still the Democrats’ fault. Their long-laid agenda of Medicare just magically forced the GOP to vote en masse to pass this legislation.
Sorry, Koz. I can’t get there from the data we have.Report
It’s not that hard to figure out Pat. There’s more to political accountability than correlation of deficits and control of Congress. Especially for reasonably recent events where there is a substantial amount of living memory and people can recollect who said what.Report
Especially for reasonably recent events where there is a substantial amount of living memory and people can recollect who said what.
Except, of course, for between 2002-2006.
That’s in the dead zone.Report
Well North, I don’t know what skinwalkers are but the GOP has mixed record. Sometimes they’ve been baited by the Demo’s into aggrandizing state power, sometimes they’ve done it on their own accord and sometimes they’ve fought the good fight for limited government.
The Demo’s have never done anything useful. Or to put it another way, they things that worked during the Clinton Administration were the result of the things the Demo’s didn’t do as opposed to the things they did.Report
JB, I’d say the 111th [2007-2009] Congress made the 109th & 110th look a lot better.
Not good, mind you, but better.
I’ve been watching this discussion, but it seems it’s getting deconstructed out of existence. I’ve read enough of competing numbers that fixing blame for how the world fiscal situation went kerblooey in 2008 is more a matter of taste than ascertainable fact. [Ascertainable to the satisfaction of both camps, anyway.]
The question is only, where do we go from here?
The GOP is aesthetically condemned as the Grinch in entitlement spending, but it can’t be blamed for both being the Grinch and being Santa Claus. [Altho it’s worth a try, I guess.] If the prescription drug package was too generous, Al Gore had promised one, too, so IMO, it’s a push.
So too, if the Dem-left is to take credit for social program “progress,” it must take accountability for its costs. It cannot take the aesthetic credit and shift the costs to the other camp.
The Golden Age was the Gingrich congresses, of course, ’til Newt’s wheels fell off, and as much credit as is actually due Bill Clinton for “triangulating” his way—kicking and screaming—to deficit hawkage.
Since Clinton got the credit for both welfare reform and balancing the budget [The Clinton Surplus!] , I’d say he did well for himself. And not too bad for the nation.Report
Tom, I’m of the opinion that if someone is going to stop drinking, that they’d be best off if they did something like follow the 12 Steps.
If they can’t even admit that, maybe, they have a problem? My suspicion is that they’re probably going to continue drinking.
Perhaps there are worse alcoholics out there than our dear Uncle Republican Party… but the fact that Shakes the Clown over there is pounding the better part of half a bottle of whiskey in fewer than 10 seconds, does not mean that Uncle RP is not a drunk who seriously needs to go through the 12 steps before I’m going to give him my vote.
You want to enable the guy? Well, that’s between you, him, and God.
I ain’t gonna.Report
JB, I’m just not into narratives. Too many fishing narratives and metaphors and analogies. You’re barking up the wrong tree.
;-PReport
Facts are useless without a story, TVD.
Without a story… they’re just facts.Report
Come now Koz, this frothing and fulminating is just sad, and you’d been doing so well in your guest posts.
I mean what kind of on message claptrap is this? It’s utterly devoid of any meaning; just a cluster of emotional inveigling about liberal policies that sounds like it is yanked right out of the saddest partisan corners of Tea Party or GOP rantings. I mean people have tried to be patient with you but the endless squirming around those damnable facts surely must be tiring even for you?
I’ll note in full earnestness that the credit rating of the Treasuries remains functionally sound at this time. S&P have gone down a notch but it takes two out of three credit ratings to cause anything like a functional downgrade. Certainly I will cop to being mightily astonished that S&P did what they did though I’d note that it must take astonishing feats of mental gymnastics for you to actually try and claim that this event was a result of Liberal intransigence or policies. Certainly the voters are keenly aware of where the blame lies. I do not see how you can claim after the liberals conceded first to addressing the deficit in the debt ceiling debate and then conceded again to doing spending cuts alone how it somehow becomes the liberals who are at fault for S&P’s downgrade (especially after S&P flat out stated where the blame lay). I mean how do you even rationalize this?
Do you honestly claim that Democrats alone have run up the nation’s debt, seriously?
Do you somehow think that all of this political brinkmanship which precipitated the current downgrade matter (S&P flat out stated that their concerns with the US were related to the political climate, not the math of the debt) was a consequence of liberals being stubborn?
I mean honestly, what beyond your primal screaming about liberals is your point? Do you even have one?Report
“It’s utterly devoid of any meaning; just a cluster of emotional inveigling about liberal policies that sounds like it is yanked right out of the saddest partisan corners of Tea Party or GOP rantings.”
No, it’s not that at all. If you get anything at all from what I write get that. Tea Partiers and institutional Republicans don’t talk or think this way, though maybe they should.
It helps to read what I actually write instead of your filtered first impression.Report
Oh no old boy, I read it over a couple times all geared up to argue and refute. Reread it yourself. It was three paragraphs of unsupported accusations and a little stuff that almost sounded personal. Fortunately I’ve got a thick skin. I’m happy to see you seem to have calmed a bit in your later replies.Report
I dunno, it looked pretty clear to me. It might seem distasteful and condescending to talk about libs like they were a dog that pees on the carpet. Unfortunately, that’s just the breaks. Their intentions and the way they interact in our political culture, they didn’t leave any alternative.
It’s not just a matter of libs making this or that mistake, it’s how they did it. This business of the downgrade is illustrative for just this reason, even if the downgrade itself ends up being unimportant.
There’s at least three mistakes libs habitually make:
1. Their willingness to use private resources to their politically or socially favored ends.
2. They understand less of the world than they think they do.
3. They control less of the world than they think they do.
In my experience, libs have heard quite a bit of #1 so they’ve rationalized their way around it. But, they really don’t understand #2 or #3, which is why I want to emphasize them here.
As we’ve gone back and forth about Demo economic mismanagement, you have freely admitted on several occasions that you have limited economic understanding yourself, that you rely on lib elites to keep the economy afloat. That trust is misplaced. They misunderstand the economy too. And, let’s also realize that as you propagate your views into the political culture, you’re implicitly asking the public to trust you. Every link of this chain is overburdened.
This is magnified in the context of our current economic problems. From President Obama to you or Elias or whoever, there’s no liberal who has any credibility at all that they have a handle on the downside risk of the consequences of their favored policies. The downgrade, Demo unemployment, lack of growth, every important economic event during the Obama Administration ought to make this crystal clear by now.
Given all this, why are you spending all this energy trying to fight the Republicans? Maybe they were right all along.Report
Heh, your three numbered items apply to both liberals and conservatives pretty much evenly. Only libertarians get a pass on #1 and despite much rattlesnake flag draping neither the GOP nor the TP are actually convincing anyone they’re suddenly libertarians.
I have, indeed, freely admitted to the limits of my own economic knowledge. I’m no economics major (just a business major) and so I’ve no grasp of the airy heights of the dreary sciences theories. Admitting such is just my commenting style; I’ve found it’s helpful in my discussions and I’m happy to report that so far I haven’t been written off as a “ghost” or an ideological apparatchik.
That said the liberals in general are absolutely aswim in policy wonks who are fully as knowledgeable, if not more so, than conservative ones. In fact I’d go so far as to say they’re more knowledgeable than conservatives since they don’t worship at the insane tautologies like Starve the beast or laughable make-believe like supply side economics. The party and liberals are quite credible on economics in general both in general and specifically to the issue of the debt. I’ll note that along with the public economists also agree generally that the solution to the current problems are the liberal advocated solutions of spending cuts coupled with revenue increases (and were generally aghast at the debt limit fiasco).Report
“That said the liberals in general are absolutely aswim in policy wonks who are fully as knowledgeable, if not more so, than conservative ones.”
No, North, the proposition is not that liberal wonks are better at wonking than conservative ones (a proposition I would strongly dispute btw but it’s not too relevant here).
It’s more a matter that lib wonks have very little understanding or predictive credibility over the course of events. This is especially important given that libs have very little appreciation for the probability and severity of the downside risk they are forcing on the rest of us.Report
“I’d note that it must take astonishing feats of mental gymnastics for you to actually try and claim that this event was a result of Liberal intransigence or policies.”
Well, yes it was the result of liberal polices (or more accurately liberal intentions propagated through the political culture in a several ways, including policy).
But, we need to understand the downgrade as the cumulation of lib policies over many years, not just a political the result of a political food fight from two months ago. And just like you said, the downgrade itself might not end up being that important. But, here’s the thing North: the events that caused the downgrade are important, even if the downgrade itself isn’t.Report
Well we can talk about it big picture or small but I still fail to see how you manage to saddle this entirely on liberals either way.Report
Simple. Libs and conservatives can both spend public money on human interest needs. But only the libs still want to continue a trajectory of expenditures long after it’s clearly demonstrated to be unsustainable.
There’s also another element you’re missing. There’s the idea that due to their previous mistakes, libs have forfeited all claims to leadership on economic issues. I think you get that, at least as an item for discussion. But what I think you’re missing is that libs don’t understand enough of the workings of the economy even if we were to trust them again.
Figures such as what the deficit will be in six years according to some policy path, those are just guesses. They might be intelligent guesses or dumb guesses but they are always guesses. Even if they are intelligent guesses they can still be wrong.
If we had some appreciation for the severity of the problems, we might be able to react to it better. At the very least, we wouldn’t have PPACA.Report
But all of this is both exaggerated and hypocritical.
Liberals have indicated, repeatedly, a willingness to address the fiscal concerns of the country over and over including actual offers to cut spending outlays in a wide variety of ways. That the debt is large is admissible but the basic math of this country’s debts versus GDP do not merit the overblown rhetoric you, and the TP/GOP in general, bring to bear on this matter. The country remains eminently capable of paying its debts down at any point through either moderate reforms coupled with modest tax increases or through dramatic tax increases or massive cuts in spending. The liberals (and the country) have indicated a preference for the former while the Tea Party has insisted fanatically that only the lattermost option is permissible.
You claim that some sort of liberal cardinal sin in the past fundamentally disqualifies them from being permitted to govern yet massive recent conservative policies are huge contributors to our current level of indebtedness and to the political dysfunction that is at the root of the problems today. Why have conservatives not been disqualified in exactly the same way? The idiocy of “starve the beast” for instance is a conservative creature and is a massive driver of the deficit levels today. One reason why it’s so hard to take you seriously is how franticly you hand wave away or simply ignore conservatives own massive failures.Report
“You claim that some sort of liberal cardinal sin in the past fundamentally disqualifies them from being permitted to govern yet massive recent conservative policies are huge contributors to our current level of indebtedness and to the political dysfunction that is at the root of the problems today.”
Again that’s part of the issue, and fwiw that part applies more to the blogger/activist/commenter types anyway. There’s also the angle that the lib wonks don’t understand enough of the economy to justify their policies.
And in this case, there’s also the idea that the lib political establishment can legitimately do what needs to be done to preserve the functioning of the economy. But not to indulge their own ideological crap. No one gives a s**t what their institutional prerogatives are or are supposed to be.Report
North, have you ever wondered what it would be like to argue with a member of the Politburo of the GDR in, say, 1964?Report
“Do you somehow think that all of this political brinkmanship which precipitated the current downgrade matter (S&P flat out stated that their concerns with the US were related to the political climate, not the math of the debt) was a consequence of liberals being stubborn?”
Well, yes, but you have to state it differently than you did?
Do you suppose that if libs really did accept their culpability for the welfare state, the culture of dependency, and debt bondage that goes with it it, that we’d have the political instability contributing to the S&P downgrade? I don’t.Report
As a general rule liberals are perfectly culpable for their roles in the welfare state and most of ’em are pretty proud of it.
They generally contest the culture of dependency portion (and I haven’t read much about that issue being particularly problematic since the 90’s welfare reforms) and of course Liberals don’t accept sole responsibility for the debt portion since they generally believe in taxing the electorate to pay for their programs. Hey, remember when the GOP used “tax and spend” liberals as an epitaph? So when discussing the debt boondoggle you pretty much part ways with them there.
on the other hand, I haven’t seen any liberals near the levers of power claiming to be utterly exempt from responsibility for the debt. Obama certainly hasn’t, mushy conciliator that he is, which is probably why Liberals compromised and compromised and compromised during the debt debates. But maybe we’re talking about fantasy liberals on the web or from the 1980’s rather than the liberals as they exist right now?
So what precisely more do you think Liberals “accepting” these things would have offered; accepting the electoral suicide and political insanity that was the GOP position? As I recall even you said the amendment idiocy was a bad idea but there it was, shoved into the GOP bills. Oh and there’s Boehner who you suggested was in control of the situation forced to include it under the whips of his right wing.Report
For that last part, let’s note that the Reid proposal came out one week before the supposed default deadline. If it had come out two months earlier, or even two weeks earlier things would probably have been much different, at least as far as the bitterness and antagonism is concerned. But, I’m sure the Tea Partiers would say that they had to go right to the edge of the deadline or else there would never have been any Demo support for the Reid plan. And as much as I don’t like the way the Tea Partiers played issue, I suspect they might have a point.
In other words, I think you’re misunderstanding this conciliator business. Do you think the Administration’s handling that issue really represents someone with the understanding of libs’ responsibility for our fiscal situation?
There was a piece (by Kevin Drum in Mother Jones, I think) bouncing around the liberal blogosphere congratulating/praising Nancy Pelosi and the House Demos for voting for the final deal. Drum wants us to believe they were supposed to hold out for some special pleading. Where had he been for the last three months. The whole point of this deal is that Demos have a responsibility to preserve the functioning of the economy, not the privilege of getting bought off to do things they are supposed to do anyway.
As far as taxing the economy to fund the welfare state, again that’s a matter of lack of understanding and lack of control on the part of libs. Lack of understanding in that there is no tax regime that funds the trajectory of expenditures according to the assumptions embedded in current law up till the enactment of the debt limit deal. Lack of control in that if there were such a tax regime that the Demos could implement it and collect the taxes.Report
Oh come now, this is just sophistry. The formal bill only came out in the last week but the offers were flying back and forth for weeks and weeks prior to that. Yes the GOP and TP have suddenly hidden behind the canard that nothing was “official” because it hadn’t been written into a bill and presented in the House but no one is buying that nonsense because even children know that isn’t how bipartisan politics are done. You agree on the general scope of the bill prior to writing it and once the general dimensions are agreed upon you send it through the formal channels. Offers were made by Obama, on a level of generosity that had the entire left reeling in dismay, and they were rejected because of intransigence. The spectacle of Boehner on his knees being forced to insert the madhouse balanced budget amendment into his bill and then still being forced to depend on Demo house votes to get his bill through is a pretty clear indicator as to who the road blocks in this scenario were: the same people who precipitated the crisis in the first place (in the short term/picture).
To your last part this is again just false. There is a tax regime that could fund the current levels of expenditures; it’s just political suicide which is why no one but a far left and ignored rump is seriously proposing doing so. The lack of control, again, remains false. Unless a deal is cut the GOP faces tax hikes of their own creation that will go a large part of the way to closing the deficit. All Demos have to do at this point is refuse to permit an extension though they’ve indicated repeatedly their willingness to cut a deal of some sort.Report
No, the lack of actual bills was a separate issue. I’m talking about the Reid plan, which he came out with on the Monday the week before the deadline. That was the first time any significant Democrat had endorsed a no-revenue plan. There were at least $1T in cuts that were relatively not controversial. Therefore let’s do those, and leave revenue and more controversial cuts for another day. That was the Reid plan, and it took the D’s the whole spring and most of the summer to get there.
So you should be rethinking this whole business of conciliation. I’m sure the D’s would rather have had a revenue component, but there was no reason why they had to have it. Certainly they never made that case in public.
Again, the fact that the D’s never had actual bills is a separate issue, one that doesn’t speak well for the D’s. Since you brought it up, I hope you’ll forgive a small digression. First of all, it’s just not the case that negotiations typically proceed without bills. It can go either way, and a lot of the time it doesn’t make much difference.
There are reasons why someone would want an actual bill as opposed to a proposal without a bill, eg, for parliamentary reasons or to get scored by CBO or somebody else. In this case, it was actually important for other reasons. Throughout all the fiscal issue negotiations for the better part of a year, there was a significant issue of a lack of commitment on the part of the D’s to their own proposals. And for the debt ceiling whatever they came up with was sure to be controversial on the left flank. Therefore, President Obama couldn’t advance a proposal on his own initiative. He has to have a written plan, and let Krugman, Digby and the idiots at Balloon Juice hit it like a pinata for at least one news cycle. If he does that, and the Demo’s get cold feet, there’s no point in the GOP negotiating against themselves.
“To your last part this is again just false. There is a tax regime that could fund the current levels of expenditures…”
No North, there really isn’t, and it’s an important part of the whole controversy that libs need to get hit with the clue stick until they see it too. The point being, “current expenditures” goes past what’s spent this year, including the trajectory of what’s intended to be spent in the future as well, especially in current environment of Wisconsin and the CRs where the Demo’s intended to reaffirm a commitment to every nickel of it.Report
Is this where I point out that when the stock market was tanking last week, traders went to…wait for it…US Treasuries!Report
By all means go ahead if you want. If you do, do your best to state a complete argument. My guess is, that you’re substantially misunderstanding important time frame considerations but I have to wait for you to know for sure.Report
Just as an aside, I imagine there’s quite of bit of Nixon going to China with Cuomo’s deals with the unions. I would hypothesize that a Gov Pataki doing the same exact thing would have been a redo of Walker-Wisconsin to the nteenth power.Report
I’m not willing to say that what Cuomo is doing is a bad idea. New York could probably benefit a lot from trimming regs in general and cutting the unions a bit makes general deregulation easier.Report
If the goal was to lay the groundwork for deregulation I would have preferred he, y’know, ask the unions to support some measure of deregulation. I don’t like policy that front-loads the pain and hopes for nice things in the future. I also don’t think that’s his goal, anyway, but that’s another story.Report
No, agreed his primary goal is probably saving money. I don’t see that being terrible either.Report
Because of course, the pain must be borne by the middle class. After all, it was those unionized teachers and firemen who brought down the economy, right?Report
In New York I wouldn’t say so, no. But their rent control aparachiks and endless regulatory bodies (does anyone know how many legal docs it takes to run a food stand in NY; last I read it was three times the national average) sure didn’t help.Report
You’re really going to argue that our current economic straits is because of rent control and barbershop licenses? Or that it’s sensible to make-up the gap by cutting taxes for the wealthy and reducing pay for bus drivers? Obviously this is tendentious framing, but it’s not untrue, either.Report
Certainly not! Perish the thought. I think that taxes should be raised for the wealthy at the very least and in general as well since they’re at historic lows. But taxes aside cutting spending is a good idea as well and cutting spending that is used for economic dampening and inequality heightening programs like rent control and retarded over-regulation strikes me as a good idea.Report
No. Wall Street brought down this economy. Nothing more and nothing less. Middle-class people being able to afford to live in New York and neither did too much papework. A lack of regulation did us in and anything else is just a neoliberal, conservative, or libertarian fantasy.Report
nyc is a special, weird case. income levels are wildly disproportionate; housing is deeply regulated (and still terribly expensive, obviously, as supply can only be squeezed so far) and it is a pain in the ass to run a business here. hell, it’s a pain in the ass to hang a sign here. and yeah it carries most of the rest of the state financially.
i have no love for the public unions, mind you, but i’d be more into cuomo if he started with cutting regulations that strangle small businesses and other obvious roadblocks (the current food cart kerfluffle is instructive…if you don’t own a food cart).
as it stands all i can say is at least he’s not spitzer.Report
Jesse, I very earnestly hope that you do not consider rent control of all things synonymous with allowing middle-class people being able to live in New York. I can’t personally imagine anything more indicial to middle class housing supplies than rent control… well maybe carpet bombing.
As for the recession I’d happily join you in laying the larger portion of the blame for the depth of the recession on Wall Street so long as we honestly include everyone else involved as well. But claiming that a lack of regulation alone brought on the debacle seems simplistic; heck I wish the problem was that simple!Report
I don’t like policy that front-loads the pain and hopes for nice things in the future.
Policy that promises wonderful things and kicks the pain down the road is much more pleasant.
There are sustainability problems, however.Report
I’ll gladly pay you Tuesday for a hamburger todayReport
“the continued apathy on the part of the country’s elites towards reducing unemployment.”
Is it apathy? Or an inability to actually do something about it?Report
The latter. If government could create real jobs that didn’t take employment from another part and turn the economy around, they would have done it a long time ago — we’d just have a recession breaker plan that we apply at the first sight of recession and — Presto!Report
We did that, at least partially. It’s called unemployment, greater grants to Medicaid that kick in at certain economic stress levels, etc. Go google automatic stabilizers. They’re one of the reasons the recession was only terrible, not an all out depression.
Now obviously more needed to be done, such as a jobs bill that wasn’t 40% tax cuts, but there are ‘recession breakers.’ It’s just that sometimes the wall can’t stop the rolling boulder.Report