You just can’t kill a really lousy idea.
Frustrated by the months of non-stop budget fights, Senate Republicans are set to mount a fiscal counteroffensive this week with the reintroduction of a balanced-budget amendment.
Senate minority leader Mitch McConnell (R., Ky.) and minority whip John Cornyn (R., Texas) are leading the effort. They hope to unveil a bill by Thursday with unanimous Republican support.
Behind the scenes, sources say McConnell and Cornyn are eager to shift the party away from inside-the-Beltway drama and make a more national, coherent case about the GOP’s fiscal principles.
Senate insiders say McConnell and Cornyn have already lined up almost all Senate Republicans behind the plan, but the whip process is still in progress as of Monday morning.
House Republican aides say most conservatives in the lower chamber are going to support the Senate’s plan. Speeches and media appearances are being arranged for later this week.
“This is nothing but gimmickry on every level,” writes Greg Sargent. “First, the Balanced Budget Amendment. Republicans pushed this idea during the debt ceiling fight of 2011. It is terrible and dangerous policy, as former Reagan adviser Bruce Bartlett has usefully detailed. Bartlett termed the idea, which would cap fiscal outlays at 18 percent of GDP, as ‘mind-boggling in its insanity.’ Macroeconomics Advisers has said such a proposal would ‘quickly destroy millions of jobs while creating enormous economic and social upheaval.’”
Part of the beauty of the Balanced Budget Amendment was that wingnuts really like it, while it’s never had a chance of passing. It still doesn’t. It’s more of a threat than a policy. And a pretty empty one.
Democrats aren’t going to throw away future economic growth to end a one-time hostage situation wth Republicans. And Republicans are certain to know that. They’re also certain to know that if the sequester (formerly know as the “fiscal cliff”) strangles off the economy, they’re going to take the blame for it.
So it’s in all likelihood a bluff. But this bluff manages to keep the zombie bad idea of a Balanced Budget Amendment alive and shambling brainlessly around.
When Republicans Say They Can’t Create Jobs, Maybe We Should Believe Them
If you cut government spending, it helps the economy, right?
That’s what Republicans keep telling us, but it’s hard to see how this can possibly be true. The economy is spending. Government spending is demand. Reduce demand and boost the economy? It makes no sense.
And now we have a real world example of how cutting government spending, as Republicans argue, builds a gangbusters economy. As always, reality has a liberal bias.
Conservative Republicans have long clamored for government downsizing. They’re starting to get it — by default.
Crippled by plunging tax revenues, state and local governments have shed over a half million jobs since the recession began in December 2007. And, after adding jobs early in the downturn, the federal government is now cutting them as well.
States cut 49,000 jobs over the past year and localities 210,000, according to an analysis of Labor Department statistics. There are 30,000 fewer federal workers now than a year ago — including 5,300 Postal Service jobs canceled last month.
Cut spending, add to unemployment. “The public sector didn’t start to lose jobs right away,” says economist Heidi Shierholz of the Economic Policy Institute. “But then it did as the budget crunch really hit. State governments are not allowed to run deficits. So the private sector is expanding while the public sector is shedding jobs — to the tune of 35,000 jobs a month.”
So, as a consequence of reduced spending and congress’s (read “Republicans’”) failure to extend aid to the states, employment is treading water — as the private sector hires, the public sector fires. And the result is a counterproductive feedback loop keeping job growth stagnant. Republicans often argue that public spending “crowds out” private investment, but even if this were true, it again suggests a feedback loop without growth — cut government spending and private spending fills the void, but there’s zero growth in overall spending. After all, X-X+X=X or stasis. This is a no-growth policy that accepts the current status quo as the absolute best America is capable of.
Republicans really have no plan to stimulate job growth or the economy. And why should they? The fashionable belief among the GOP deepthinkers — especially among presidential candidates — is that government doesn’t create jobs. Logically speaking, this is the same as saying, “There’s nothing we can do.”
So it follows that the alternative jobs plan put out by a party that believes it can’t possibly create jobs would be a joke. Macroeconomic Advisers, LLC took a look at the GOP’s jobs plan and concluded that not only do nothing to help the economy, but the Balanced Budget Amendment provision they jammed in there would do a lot to hurt it.
“Without more detail on the Republican plan, we cannot offer a firm estimate of its economic impact in either the short or long run,” they concluded. “However, if what we do know of JTGA [the GOP’s “Jobs through Growth Act”] were enacted now, we would not materially change our forecasts for either economic growth or employment through 2013.”
“If actually enforced in fiscal year (FY) 2012, a [Balanced Budget Amendment] would quickly destroy millions of jobs while creating enormous economic and social upheaval,” they continued. “However, we believe no responsible policymaker would push the implementation of a BBA when the projected federal deficit is $1 trillion and the Fed is unable to offset much fiscal drag… A BBA would amplify cyclical swings in the economy. Furthermore, it likely would be abandoned or circumvented with the first recession after ratification, creating confusion and uncertainty over fiscal policy.”
So the Republicans’ “Jobs through Growth Act” should more honestly be titled the “Unemployment through Contraction Act.” It’s just a wishlist of items beloved by Republican dreamers over the years, with no real focus on job creation or economic growth. And why should they put forward a serious jobs plan? We’ve already established that they believe they can’t create jobs and, of course, the thing doesn’t have a hope in hell of ever becoming law anyway.
I guess the moral of this story is don’t listen to the job creation advice of people who tell you they can’t create jobs. Reducing spending is hurting our economy before our eyes and forecasters say that Republicans plans will only make everything much, much worse.
The Republican Party has been telling us over and over that they can’t create jobs and the evidence suggests that they’re absolutely right.
Say it With Me; John Boehner is Just Wasting Everyone’s Time
Seriously, what the hell is Sir John of Orange doing? Last night, Boehner finally had to abandon his attempt to get his debt limit bill passed, because he couldn’t get enough votes in the House to push it through. But that’s OK, because there was no way in hell the Senate was going to pass it anyway. Metaphorically speaking, he was gunning the engine in a desperate attempt to run straight into a brick wall before the clock ran out.
Now, he’s actually taking the zero chance his bill had of surviving in the Senate and moving it into negative territory, by tying his bill to a Balanced Budget Amendment to please the crazies.
House Republican leaders will tie a balanced-budget amendment to the Constitution to their two-step debt-ceiling bill — a move that is all but certain to clinch the necessary votes to pass Speaker John Boehner’s proposal a day after it stalled…
Several GOP conservatives had held back their support for Boehner’s bill because they wanted the balanced budget amendment provision included. It was the main point of contention in Thursday night’s talks between GOP leaders and the holdouts.
The House plans to vote on the bill Friday afternoon.
“If Boehner pulls off a victory in the House, the bill will then head to a hostile Senate, where Majority Leader Harry Reid has said the package is dead on arrival,” the report goes on. “Reid is preparing to introduce his own debt-ceiling package, calling it ‘the last train out of the station.’ It shares some similarities with Boehner’s plan, but would raise the debt-ceiling into 2013, rather than require a second vote in February.”
Of course, the ‘baggers are happy with the Balanced Budget Amendment, because they believe that people in Washington are incapable of doing their jobs — while bending over backwards to prove that assessment correct. A Balanced Budget Amendment could more honestly be called the “Stop Me Before I Spend Again” amendment, since (presumably) no one put a gun to Republican’s heads and made them vote for unfunded deficit fertilizer like Medicare Part D, the wars in Iraq and Afghanistan, or Bush’s tax cuts for the wealthy. Taken together, these have all grown deficits at a record pace, while all these teabagging freshmen were sitting in their easy chairs, listening to Rush Limbaugh, and cheering it all on. Want to cut down on deficit spending? Elect fewer Republicans, not more.
And, in all the drama and late-night arm-twisting Boehner’s plan is generating, the sheer pointlessness of his efforts is being lost. None of this is going to go anywhere, it’s all a waste of time, it’s all just fiddling while Rome burns. The media should be spending a lot less time on the behind-the-scenes wrangling and a lot more on the stupid pointlessness of it all. We’re four days away from the debt limit deadline and Boehner’s dicking around with doomed, symbolic legislation designed solely to create the appearance of doing actual work.
It’s recently been asked if this is the “worst congress ever.” Maybe we should narrow that down; is John Boehner the worst speaker ever?
News Roundup for 7/27/11
GOP’s new symbol
-Headline of the Day-
“House Republicans Revolt Against Boehner Debt Plan.”
Who’s the leader of House Republicans? Turns out it’s not Speaker of the House John Boehner. In fact, it’s looking a lot like it’s nobody. Remember how Boehner went on the teevee to tell everyone that Obama’s plan sucked and his ruled? Yeah, turns out that a lot of Republicans think his plans sucks. A lot GOPers don’t want to raise the debt ceiling at all, mostly because they’re stupid, insane, or some combination of the two.
You might remember that Boehner ran it past the guy he thought ran the House — Rush Limbaugh — and the boss said he was cool with it. So that means that these ‘bagger nuts are to the right of Rush Limbaugh.
Boehner and his partner in crime Eric Cantor have been reduced to bullying and pleading with the crazies, but it’s no go. So far, they’ve chosen their kamikaze run and they’re sticking with it. (Crooks and Liars)
-“What could I do?”-
The real purpose of a Balanced Budget Amendment…
Click to embiggen
Any questions? (McClatchy)
“Endangered Species Act Restored In House Revolt By Democrats.”
Wow, score one for the good guys…
Although, the fact that I’m surprised demonstrates just how screwed we really are. (ThinkProgress)
GOP Utopia: Low Wages, High Unemployment
I’m tempted to wish Republican’s balanced budget amendment was in force, because this bad idea would sink another bad idea. According to Jed Williams at Investors Business Daily, “Under the balanced budget amendment proposal unveiled last Thursday with all 47 GOP senators on board, the blueprint presented by House Budget Committee Chairman Paul Ryan on Tuesday would be unconstitutional until sometime after 2030.”
But then I remember that the GOP’s amendment is never going to go anywhere — just like Paul Ryan’s long-term budget. In fact, I have my doubts that either is even meant to survive. Constitutional amendments have to clear such a high bar that an actual movement is required to put them in place. Right now, the teabaggers seem to have all gone home and the only thing resembling a movement in this country is a backlash against draconian spending cuts in the states. I want to say the window of opportunity has closed, but the fact is that it was never even open.
Constitutional amendment proposals from Republicans tend to be vote-getting gimmicks to display how serious they are about the base’s pet issues — without actually being serious at all. Banning marriage equality, banning the rampant scourge of flag burning, and English-only amendments pop up all the time, only to die after being neglected even by their authors. These aren’t fights Republicans are willing to have, these are fights Republicans are willing to pretend to have. A “stop me before I spend again!” amendment fits that description very well.
And, like the balanced budget amendment, Paul Ryan’s budget is more a statement of principles than a serious document. Riddled with wishful thinking and logical holes, it reminds me of this old Sidney Harris cartoon:
Unemployment will be low, the deficit will shrink, and everyone will be happy thoughout the land — after the budget miracle occurs. Not surprisingly, Ryan’s projections aren’t just being greeted with healthy skepticism, but with outright mockery. To see the best of it, check out Paul Krugman’s take.
But the principles in Ryan’s document are disturbing; slash spending on entitlements, lower taxes on the wealthy, raise taxes on everyone else. These are called “tough choices” by millionaires for whom the choices aren’t tough at all. It’s a massive redistribution of wealth from you to them. Tough for you, sure. For them? Pffft!
And, to return to Krugman, before the Ryan plan, there was a report from House GOP. That document calls for the suppression of wages and increased unemployment — right out there, in the open, unabashedly.
Two weeks ago, Republican staff at the Congressional Joint Economic Committee released a report, “Spend Less, Owe Less, Grow the Economy,” that argued that slashing government spending and employment in the face of a deeply depressed economy would actually create jobs…
Here’s the report’s explanation of how layoffs would create jobs: “A smaller government work force increases the available supply of educated, skilled workers for private firms, thus lowering labor costs.” Dropping the euphemisms, what this says is that by increasing unemployment, particularly of “educated, skilled workers” — in case you’re wondering, that mainly means schoolteachers — we can drive down wages, which would encourage hiring.
If you read this blog even occasionally, the obvious should leap right out at you — employers hire because they need people, not because those people come cheap. If we drive down wages for everyone — and yes, that is the plan — then employers just wind up paying less for labor. There’s no hiring binge. In fact, lower wages would guarantee a drop in demand, which would depress hiring and wages even further, which drops demand, which depresses wages and employment — lather, rinse, repeat. In short, it’s a recipe for recession.
Who does this help? Employers, of course. See we’re busy thinking about what all this means for America, but we live in a global economy. If Americans can’t afford to buy stuff, who cares? There are plenty of markets in plenty of other countries where their governments are foolishly more concerned with the welfare of their people than the welfare of their corporations. Can’t sell widgets in Des Moines? Oslo’s always buying. Just have your child laborers start printing the labels in Norwegian.
If Republican budget fairy tales tell us anything, it’s that they aren’t awfully concerned with the vast, vast majority of Americans. They represent that top one or two percent of wage earners and everyone else who votes for them are just chumps. Maybe your taxes are too high, but cutting at the top while raising yours isn’t tax relief. And depressing your wages to the point where you’re paying into a lower tax bracket isn’t much help either. But that’s the plan — they’re telling you as much. So maybe you should believe them.
They’re calling it “fiscal sanity,” but it’s self-destructive madness for you to back it.