When I began to prepare to write this column, five days ago, the newest wave to crash was the report in the NY Times for June 14 that the President is wading once again into the treacherous shifting sands of Middle Eastern politics—by committing the U.S. to upping its support for the rebels in Syria, from only food and medical supplies to also small arms and ammunition. What next? And -- is this really a good idea? “Bad Idea, Mr. President,” is the title of an Op-Ed article in the Times for June 16 by Ramzi Mardini, an adjunct fellow at the Beirut-based Iraq Institute for Strategic Studies and a former employee of the U.S. State Department’s Bureau of Near Eastern Affairs. According to him, the government of Bashar al-Assad still enjoys substantial support from many Syrians, including members of the Sunni urban class, and uprooting him would only destabilize the region still further. “The Syrian revolution isn’t democratic or secular, “ Mardini warns. “The more than 90,000 fatalities are the result of a civil war not a genocide—and human rights violations have been committed on both sides.”
How did Obama get himself enmeshed in this? Seems that last August, he “drew a red line” at a press conference, saying that if the Assad government started to use chemical weapons, the U.S. would enter the fray. And, since that red line has apparently been crossed, Republican and Democratic hawks – most especially John McCain & Bill Clinton -- have been hounding him to live up to this promise. “After Arming the Rebels, Then What?” asked the NY Times, in a June 15 editorial. What is Obama going to do for an encore? Is there going to be any end to this escalation? Marzini pointed out that the President hadn’t even tried to exhaust the potential for diplomacy and negotiation --- and if the U.S. isn’t going to do this, who will?
The move is all the more discouraging because for so long, the President has been moving in the opposite direction, withdrawing troops from Iraq since before his re-election, and announcing that 34,000 more troops would be withdrawn from Afghanistan in his State of the Union speech on February 12. Charlie Savage, in the NY Times for May 1, also reported on an apparently fresh effort by the President to close down the notorious Guantánamo prison in Cuba (though a Times editorial on the same day said that he was still advocating force-feeding as a means to deal with hunger strikes there). In a major speech on May 23, he declared that he planned to limit the “drone” strikes in Pakistan, Yemen and Somalia, as well as narrowing the scope of the domestic war on terrorism.
All of this was good news to those of us who feel that the U.S. would do better to lay off active engagement & seek peaceable means to quell the turmoil in the Middle East---specifically, to avoid falling victim to the rhetoric of the “Arab spring.” Toppling even autocratic governments doesn’t automatically lead to situations that we would consider desirable—as witness the lead article in the Times’ Week in Review section for June 16. “Egypt’s Perilous Drift,” by Thomas L. Friedman, describes the horrible economic situation that Egypt finds itself in. The country is running out of hard currency and can’t buy enough gasoline and diesel fuel for its power stations, leading to shortages all along the line, right down to government-subsidized pita bread for the poor. Yet the ruling Muslim Brotherhood, and its president, Mohamed Morsi, seem more interested in imposing religious norms than in solving secular problems – a policy which dismays the many voters who supported the Brotherhood in the last elections, despite not being extremist Muslims themselves. As Friedman diagnoses the problem, all those countries which have experienced “the Arab Awakening” find themselves in a situation where “one group or another thinks it can have it all and too few people are thinking of the common good….” (Does that sound familiar?)
Still, let us not be too surprised at Obama’s ramping up the war machine in reference to Syria. Foreign policy has traditionally been a bipartisan affair, and the different but related “war on terrorism” has been a bipartisan affair as well. Regardless of what Obama said on the campaign trail in 2008, ever since he took office he has espoused a number of hardline policies that were also espoused by George W. Bush. Nobody who knows this can have been overly (if unpleasantly) surprised by the revelations in May that the Justice Department had going through the records of the Associated Press, a venerable & honorable news-gathering organization, or by the subsequent revelations in early June (through an article in the Guardian by Edward J. Snowden) that the National Security Agency was also spying on the email and phone records of millions of ordinary Americans. Nor could anybody who knew of the bipartisan nature of the issue here have been very surprised when Senators and Representatives from both parties defended this surveillance on the Sunday talk shows, according to Brian Knowlton in the Times for June 10—or that the day after, Scott Shane and Jonathan Weisman also reported in the Times that any debate in Congress on Snowden’s article was “unlikely.”
On domestic issues, we have a two-party system in this country, each party with its own priorities & core constituency. Under more or less normal circumstances (or anyway, the way it used to be), the two parties set forth their demands on each issue that requires legislation in Congress. Then the leaders of each party (plus some of their most persuasive members) negotiate with each other and arrive at a consensus that eventually allows each piece of legislation to pass both House and Senate, thereby allowing it to become law – assuming, that is, that a mechanism exists for ironing out any inconsistencies between the House & Senate versions of the bill, and also that the President is willing to sign it
This process of negotiation & compromise (despite much shrill controversy) allowed the U.S. to sidestep a “fiscal cliff” at the beginning of this year. On January 1, both House and Senate passed a tax bill that allowed both Democrats & Republicans to claim some triumphs. The bill was necessary because the Bush-era income tax cuts were about to expire, and nobody (in Congress, anyway) wanted the tax rates to go back to where they had been before the cuts. The Republicans wanted the cuts to continue exactly as they had been; Obama and the Democrats in Congress wanted tax hikes for individuals earning more than $200,000 annually, and couples earning more than $250,000. The bill – as finally passed – allowed income tax rates to rise on individuals earning more than $400,000 and couples earning more than $450,000.
For most lower- and middle-income families, taxes may also go up – or at least, not go down--because the two-year cut in payroll taxes (which support Social Security) will end. According to an article by Binyamin Applebaum and Catherine Rampell in the Times for January 2,”A household earning $50,000 in 2013, roughly the national median, will avoid paying about $1,000 more in income taxes – but pay about $1,000 more in payroll taxes.” (Did you know that the national median household income is only about $50,000? I didn’t, and that’s not very much--a sad commentary on how lower-paying jobs in categories like retailing and food service are the main folks who are hiring, while most of the good people with manufacturing businesses which historically had better-paid jobs are still looking around for ways to avoid hiring more U.S. workers and eying cheaper labor outside the country.
Anyway, this reinstatement of the payroll tax enabled Republican desires to lessen the federal deficit to conquer Democratic desires to stoke consumer demand by making more funds available for spending; however, the reverse was true for another item in the bill, restoring unemployment benefits for another 47 weeks to about 2 million Americans who are the long-term unemployed.
In another apparent concession to the Democrats, the Republican-dominated House on January 23 passed legislation to eliminate the ceiling on the national debt without the dollar-for-dollar spending cuts that the Republicans had previously insisted upon. But that apparent victory for the Democrats was limited to a three-month period, and due to expire in May—thereby seeming like an apparent victory for the Republicans as well.
In the meantime, the country on March 1 was assaulted by massive -- $85 billion this fiscal year alone – budget cuts to virtually every branch of the federal government. This was the “sequester” resulting from an agreement between President Obama and the Republican leadership in the House during the summer of 2011. Obama had agreed to these appalling cuts—which are particularly severe in their effects on less-privileged Americans— in order to end the stalemate which then existed over the House’s refusal to raise the ceiling to the national debt, a policy which could have resulted in the federal government defaulting on its payments for the first time in U.S. history. Obama believed that these budget cuts were so onerous that before they went into effect, newer and saner budget legislation would be enacted—but (being a conciliatory type himself) he didn’t reckon on the implacable unwillingness to compromise among the Tea Party-influenced contingent in Republican ranks—not the Old Guard so much, but what might most flatteringly be called the Young Turks, like Paul Ryan of Wisconsin in the House, and Marco Rubio of Florida in the Senate.
Most of the effects of sequestration were gradual, but almost immediately, some federal air traffic controllers were laid off, causing cancelled and postponed flights in airports across the country. Complaints began to pour into Washington, and, since they were being made by the more affluent segments of the population, both Republican and Democrats raced to enact legislation reinstating funding for air traffic controllers—although nothing was done to restore funding for assistance to lower-income Americans in areas like housing, nutrition and education.
Next, we got the budgets for the next fiscal year of 2014, which begins on October 1, 2013. The House’s bill was proposed on March 12 by Ryan, the Republicans’ vice-presidential candidate in 2012, in his capacity as chairman of the House Budget Committee. It passed the House on March 21, according to Michael O’Brien, political reporter by NBC News, as recorded at its website. The vote was 221-207, largely along party lines, although 10 Republicans joined with all the Democrats to oppose the measure. This budget claims to balance the budget in ten years, primarily by cutting $4.6 trillion from it. Commenting when Ryan introduced it, the Times editorial for March 13 observed that “all the tired ideas from 2011 and 2012 are back:” turning Medicare into a voucher program, dispensing with Medicaid and food stamps by turning them into block grants to states, to cut freely; repealing most of the reforms to health and Wall Street, and shrinking “beyond recognition” the federal role in education, job training, transportation and scientific & medical research.
Alas, the Times – as this editorial made clear – labors under the delusion that the voters vehemently rejected all these ideas in last November’s election. True, President Obama was reelected, and the Republicans lost a few seats in both the Senate and the House, but in the House, the Republicans were still returned by a large majority, and the Democratic majority in the Senate is still a slender one. In other words, the voters are still dividing their allegiances pretty evenly between the two parties—or at least, that’s what the numbers show, and (however they were arrived at) Congress has to go by its numbers.
The Senate, with its Democratic majority, passed a very different budget for fiscal 2014. As proposed by Patty Murray of Washington, chairwoman of the Senate Budget Committee, on March15, and passed by a vote of 50 – 49 on March 23, it calls for modest economies, and an overhaul of the tax code to increase federal revenues, but it also includes $100 billion in upfront infrastructure spending to boost employment & incite a full economic recovery, and estimates that the government will still be running a $566 billion annual deficit 10 years from now. No Republicans voted for it, and 4 Democrats voted against it – all from red states and facing re-election in 2014, according to the story in the Times by Jonathan Weisman on March 24. Both House and Senate, according NBC’s O’Brien, have also passed resolutions that will enable the government to keep on spending at current levels throughout the remainder of fiscal 2013—and not be forced to shut down.
A FEW THOUGHTS ON THEORY
Both the Republican budget in the House and the Democratic budget in the Senate reflect their respective parties’ beliefs and priorities. The Republican budget would slash to ribbons the government’s contributions to those programs that most benefit the very young, the very old, and those citizens with the lowest incomes. This is to be done in the name of austerity, the argument being that reducing the federal debt is the best way to stimulate growth, and that growth automatically benefits everybody. Ignoring the proven falsity of the "trickle-down" theory, Austerians claim that statistics show that economies with higher national debts grow more slowly than economies with smaller national debts. Even if this were true (and there must be statisticians who challenge it), I see no proof of causation here, merely correlation. In general, mature economies are both more likely to grow more slowly, and more likely to care for their citizens better than immature economies, which are more likely to grow more quickly simply because they are immature, and similarly – because they are immature – have not yet developed a safety net for their least advantaged citizens. There may even be a psychological parallel here: very small children are inclined to be more possessive with toys. It usually takes a more mature parent or teacher to persuade little Brian or Tiffany to share and share alike.
The Democratic budget in the Senate reflects that party’s longstanding commitment to Keynesian economic theory. Some provision is made toward cutting the unemployment rate & boosting the recovery by spending. The cuts proposed – by economies in Medicare and elsewhere --- are more sensible and humane than those proposed by Ryan, but to the extent that they would curb government spending, they are still not only anti-inflationary but a drag on the growth of the economy. Worse still, as matters now stand, neither budget sounds as though it had any chance of becoming law, since neither half of Congress would be willing to accept the budget of the other half. In the old days, such differences were ironed out in a joint House-Senate Committee, with the compromise bill then re-submitted to both House and Senate for approval, but apparently this method is out of commission at the moment. What a mess!
It’s not as though President Obama didn’t have high hopes at the beginning of his second term. In his inaugural and State of the Union speeches, he called for action on climate change, immigration reform, better gun control, and an increase in the minimum wage. But I’ve heard nothing more about any legislation on climate change, and, although I did read somewhere that a bill to raise the minimum wage had been introduced, it seems to be going nowhere. Gun control should have been a slam-dunk in the wake of the massacre of 20 schoolchildren and 6 teachers at Newtown MA on December 12, but apparently memories of that terrible event faded over the winter, while (as usual) the National Rifle Association cranked up its formidable lobbying machine. In the end, on April 17, the Senate voted down several measures to strengthen gun control legislation already existing. Apparently, 60 votes were needed to ensure their passage, and, while 4 Republicans crossed party lines to vote in favor of the measures, 4 Democrats crossed the lines in the opposite direction.
Once again, all four came from red states, and three of the four face difficult re-election campaigns next year. All four of those states—Alaska, Arkansas, Montana & North Dakota—are predominantly rural states, where (I suppose) guns are used to kill animals more often than people. Probably there is also less caring about what other countries think of us, and less awareness that we are far more prone to gun violence than almost every other developed country. To be sure, in the weeks since April 17, there was a story saying that Obama was readying some executive orders to stiffen existing gun-control law, but they lack the power legislation would have given. And, though I also have read that a few Senators are trying to revive gun-control legislation, I am not holding my breath.
Then there is the bill to overhaul the nation’s immigration system. Initially, it attracted a bipartisan group of Senators who drafted a bill that was reported out of the Senate Judiciary Committee on May 22. It would open up a path to citizenship or permanent resident status for the estimated 11 million illegal immigrants in this country—a top priority for the Democrats, who regard the current status of these people in limbo as major evidence that the present immigration system is hopelessly broken, and needs reform in order to once again make America the land of fairness and justice for new arrivals as well as native residents. However, the bill would also provide ample funds for the reinforcement of security provisions to keep out further would-be immigrants at the Mexican-American border and elsewhere—a top priority for the Republicans. By a lopsided vote of 84-15, the Senate even agreed on June 11 to permit debate on this bill—which presumably will take place in the near future.
However, there is no insurance that the bill will pass. The more enlightened Republicans in the Senate appear to be aware that, although in recent elections, votes by Latino citizens have gone heavily in favor of the Democrats, they themselves are never going to redress this balance unless they indicate that they, too, favor immigration reform. Though conservative hostility toward that liberal rag, the New York Times, is well known, some of these more enlightened Republicans may also have read the story by Sam Roberts in the Times for June 13 in which Census Bureau figures were used to establish the fact that for the first time in at least a century, more white people in the US are dying than are being born, so that (even though this situation is more than offset by white, non-Latino immigration) within three decades white non-Latinos (the core of the Republican constituency) will be a minority in the population. Moreover, in actual numbers, the white population is expected to begin declining by the end of this decade—which comes sooner than you think.
A couple of other stories suggest that immigration reform might even be good for the Republicans’ pet problem of the budget deficit. The first, by Sabrina Tavernise, appeared on May 29, and reported that immigrants have already contributed billions of dollars more to both Medicare and Social Security than they have received from it. Some of these billions, to be sure, came from illegal immigrants who assume fake Social Security numbers in order to pass as legal immigrants. Once they really become legal and eventually reach retirement age, they will be receiving moneys from both agencies, but most of the billions come from legal immigrants who, on the whole, are younger than native-born Americans, and who thus increase the size of the population that is still working and still paying into the system, instead of taking out of it).
The second story, by Ashley Parker, appeared on June 19, and dealt with a report just released by the nonpartisan Congressional Budget Office. It found that the benefits from the proposed immigration reform bill would more than outweigh the costs. With up to 11 million more taxpayers, the net effect would be to decrease the federal budget deficit by an estimated $175 billion over its first decade—and over the next decade, by an estimated $700 billion. Not waiting for this good news, House Speaker John A. Boehner had the same day gone ahead and announced that he wouldn’t even bring any immigration measure to the floor of the House unless it had the support of a majority of House Republicans. Nothing like keeping an open mind!
Even the Senate bill is already a target for more conservative Republicans, who think of it as nothing more than an endorsement of lawlessness, and an incentive for yet more foreigners to try to immigrate illegally to the U.S. One of these Republicans is John Cornyn from Texas, who (as profiled by Ashley Parker in the Times for June 15) is already proposing an amendment that he says would ensure the bill’s passage, but that the Democrats look upon as a “poison pill.” Cornyn would require that NO illegal immigrants be admitted to citizenship until 90 percent of illegal border crossers had been apprehended, and a biometric exit system installed at all sea and air ports—which is to say, effectively never. Another obstacle appears to be Senator Jeff Sessions , Republican from Alabama, who (as profiled by Jonathan Weisman in the Times for June 18) is enthusiastically preparing the same destructive tactics that he successfully employed in previous campaigns against immigration reform—breaking down the bill section by section, raising questions over every aspect of it, slowing progress on the floor to a crawl through procedural objections and a flurry of amendments. “The longer it lays in the sun, the more it smells, as they say about the mackerel,” he was quoted saying. He’d like the stink to drive everybody out.
NOT YOUR FATHER’S REPUBLICAN PARTY
Given these stalemates – among others – it’s not surprising that even Bob Dole, the former Senate Majority Leader and presidential candidate – is exasperated with the party he once led. Speaking on May 26 over “Fox News Sunday,” he suggested that neither he nor Ronald Reagan would feel at home in the current Republican party. Admittedly, he himself espoused many of the current generation’s ambitions, or at least similar ones – campaigning to cut taxes for the rich, against government regulations and in favor of blocking international treaties --- but he only insisted on these positions during campaigns. Once the elections were over, the sloganeering ended & the work began. Or at least, this is how he and the NY Times remember the past, when the paper quoted the Senator’s comments in an editorial on May 29. Now? “It seems to be almost unreal that we can’t get together on a budget or legislation,” the Times quoted Dole saying. “I mean, we weren’t perfect by a long shot, but at least we got our work done.”
MEANWHILE, BACK AT THE ECONOMY….
Meanwhile, the economy is slowly, slowly staggering back to prosperity. Hiring increased in May (as reported by the Bureau of Labor Statistics in its monthly report on the first Friday in June). Unfortunately, only about 175,000 jobs were added, not even enough to keep up with the increase in the labor force, so the unemployment rate inched up from 7.5 percent to 7.6 percent. Nor were the 175,000 jobs nearly enough to make much difference to the nearly 12 million Americans who remain unemployed. This picture is not improved by federal employees laid off or furloughed by the sequester (except, of course, for those precious air traffic controllers). Weekly wages also remain stagnant because (as already noted) so many of the new jobs are in low-paying sectors of the economy like retail & food service. Although real estate values & the stock market are surging, older Americans are benefiting from this far more than younger Americans, as Annie Lowrey reported in the Times on March 15. (Older Americans, or at least a goodly number of them, seem to have already amassed their assets, while younger Americans are still much more heavily dependent on their paychecks.) The fact that the stock market is showing such strong gains—having passed its 2007 peak already in March of this year—may be less significant as a barometer for the U.S. economy than it once was, since it responds primarily to profits, and these no longer necessarily correlate with other economic indicators, such as U.S. employment.
Still, the recovery seems to be strong enough to help the government a bit of the way out of its current hole. On May 15, Annie Lowrey further reported that the deficit in the federal budget was shrinking faster than expected. Lowrey based this conclusion on the latest report to be issued by the nonpartisan Congressional Budget Office. The report indicated that the deficit for the 2013 fiscal year, ending on September 30, would fall to about $642 billion, down from more than $1 trillion in previous recent years. This decrease could have been caused by the increased tax rates in January, or the federal spending decreased by the sequester, but the C.B.O. claimed that it had already factored in these elements in previous reports, and that the current projection is based solely upon the growth in revenues caused by the economic recovery. As a byproduct of this development, the national debt is not expected to reach its previously legislated ceiling until September, and maybe even later. Will this deprive Boehner and Ryan of a bargaining chip when negotiations on the 2014 budget between the House & the Senate get under way? One can only hope.
Even so, there is also little doubt in the minds of many economists—both in government and in the private sector—that the recovery would be stronger still without the federal emphasis on debt reduction, according to a May 9 story in the Times by Jackie Calmes & Jonathan Weisman. And the way I see it, future layoffs due to the sequestration could hamstring the economy still further.
STILL, A FEW BEGINNINGS….
Indeed, the brightest political and/or economic stories in the Times these days concern the progress being made at putting in place the insurance exchanges and other facilities mandated by the Affordable Care Act. The Act is not perfect, to be sure, but unfortunately the Republicans in the House have voted 37 times to repeal it, so the Democrats have no way of introducing the legislation necessary to merely amend it. A story by Reed Abelson in the June 17 Times described the different plans to be offered to the previously uninsured in the first 5 states that have gotten their act together: California, Colorado, Maine, Maryland & Michigan. Some of these plans are by established for-profit carriers, some are by non-profit or government entities and a few are co-ops, the co-ops being a new category created by the Affordable Care Act. It remains to be seen what becomes of these beginnings, but at least they are beginnings.