Relevant and even prescient commentary on news, politics and the economy.

Strategic Lying as Political Art

If you listen to Randi Rhodes, you know she is still livid over Romney being declared the “winner” in last week’s – we’ll call it a “debate” for the nonce.

Alas, though, the reason he won is that poll numbers have moved in his favor.  Whether that bounce is robust remains to be seen.  But it did gain Romney some sort of advantage, at least in the near term.

Randi’s objection is that Romney lied, repeatedly, and about almost everything.  In the process, he flatly repudiated some of the major planks in his platform – the destruction of Medicare as we know it, the $5 Trillion dollar tax cut, the reduction of tax share paid by high income people, and an insurance plan not covering pre-existing conditions stand out in that regard.   And these are but a few of the 27  debate lies that can easily be recognized and refuted.

Indeed, the one rare moment of lucid candor came when he eagerly, gleefully announced that he would send Big Bird to the unemployment line in order to avoid borrowing money from China.  Big NPR whoop!  To put this in perspective, for CY 2012, the Federal Government, via the Corp. for Public Broadcasting, is contributing $26.65 million in support of PBS, or 0.0007% of total Federal expenditures ($3.77 Trillion) for 2012.    In fact, the entire Federal contribution to CPB is $445.2 million, or 0.0118% of total expenditures. That’s sure going to help balance $5 Trillion in tax cuts over ten years. (CPB data from Wikipedia, current expenditure data from the St. Louis Fed.)   Romney isn’t lying about our creditor position with China, but he was certainly misleading.  According to Fox News (!) “China, it turns out, holds less than 8 percent of the money our government has borrowed over the years.”

OK, I get where Randi is coming from – to have a totally unprincipled opportunist in charge of running the world’s greatest super power is not a recipe for any kind of enduring success, either for the U.S.A. specifically, or for the world at large.  There are many historical examples one could cite, but we really needn’t go back any further than the “compassionate conservatism” of unprosecuted war criminal and would-be social security privatizer George W. Bush to make the point.

But what Randi refuses to acknowledge is that what we witnessed last week was not a debate, by any recognizable definition of the term.  Lying will get you disqualified in a real debate – right?  This was political theater – and what is theater but staged fiction? 

And there is nothing unusual here.  I’ve been saying for years that all Republicans do is lie, and then lie about their lies. (I might have gotten that phrase from Randi – the memory is foggy.)  Here is a four-year-old exposé of some of Romney’s shape shifting.  (H/T to Dave Brockington at LGM.)

A more insidious kind of lie is simply denying reality, as characterized by birtherism, New Deal and global warming denialism, and Friday’s epidemic of conspiracy theories surrounding the latest favorable jobs report.   But I digress.

Here is my point.  Brad Delong points us to a 1984 Fay Joyce article in the N. Y. Times uncovered by Michael Moore.  It turns out that lying during a debate is a time honored Republican strategy.  Even 28 years ago, when there was some chance of the main stream media doing actual journalism, they were confident in their lying strategy.

The Republicans are unabashed in their discussion of their ability to use the television medium. “You can say anything you want during a debate and 80 million people hear it,” observed Peter Teeley, press secretary to Vice President Bush. If reporters then document that a candidate spoke untruthfully, ”so what?”

”Maybe 200 people read it or 2,000 or 20,000,” he said.

Now, they have honed it into an art form.  And it’s worth remembering the one reason that always accounts for every person’s lie: their agenda is not compatible with the truth.

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I Take No Joy in Raping and Pillaging

Chris Christie moves New Jersey into the 17th century:

Christie is cutting $475 million in aid to school districts, $62 million in aid to colleges and $12 million to hospital charity care. He is pulling all funding from the department of Public Advocate….He is cutting state subsidies for NJ Transit, a move Christie said could lead to higher fares or reduced services but would force the agency to become “more efficient and effective.”…

“I take no joy in having to make these decisions. I know these judgments will affect fellow New Jerseyans and will hurt,” Christie said. “This is not a happy moment. However, what choices do we have left?”…

Senate budget chairman Paul Sarlo (D-Bergen) said cutting funding for schools was not the same as cutting state spending, and would simply raise property taxes.

Chris Christie reprising the plan Christie Whitman used to “balance” the budget: the one created by Cokehead that has led to property taxes rising by 50% in the first seven years of this decade alone.

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A Response to Megan McArdle, Again (by cactus)

by cactus

Megan McArdle responds to a post I wrote:

So Obama doesn’t count because he’s not really a Democrat. But Bill Clinton was. But Richard Nixon–the chap who implemented price controls and massively expanded Social Security and Medicare–was definitely a Republican. Jimmy Carter, who deregulated like mad: definitely a Democrat.

What are these policies that neatly define Democrats to exclude only the ones who happen to have crappy growth? On what metric does Barack Obama register as farther to the right than Bill Clinton? Because from what I remember of the 1990s, I spent most of the decade listening to my genuinely left-wing friends weep that he’d betrayed them. Remember Edelman’s resigning in protest of welfare reform?

I thought it was unnecessary at this point to explain the one thing I’ve pointed out time and again differentiates Republicans from Democrats. I think the first time was here. (I tend not to break out JFK from LBJ, or Nixon from Ford because JFK and Ford only served a short time, but the post that is attached is illustrative of behavior, not performance.)

The difference is the tax burden – that is, the percentage of people’s income that gets collected in taxes. Not the marginal rate – the amount people actually pay divided by the amount they make. And there is a difference, a big difference. As an example: George Herbert Walker Bush famously raised marginal rates. It might have cost him an election. But GHW Bush also quietly lowered the tax burden. He did it through the people he appointed to the IRS, through the degree of compliance he sought, through the way his IRS interpreted existing rules and regulations and through how the body of tax rules and regulations changed while he was in office.

Going back to 1952 at least, every Democrat, every single one, has increased the tax burden. Every single Republican raised lowered [h/t Bruce Webb] them. The data in the attached post is from the IRS and goes back only to 1952, but one can wander over to the BEA’s NIPA Table 2.1 and compute the tax burden ourselves with National Income data going back to 1929, and whaddaya know, the rule also works for Hoover, FDR, and Truman. Just barely for Truman… but then he is the exception on performance too, right?

Now, I doubt you could find a single person on the right of the political spectrum who would tell you that taxes don’t affect economic growth. They all believe taxes affect growth. Of course, the story they tell is that cutting taxes produces faster economic growth. The fact is, however, the Presidents who cut tax burdens tended to produce slower economic growth than those who raised taxes. (I’ve discussed why in a number of other posts, and I don’t feel like rehashing or looking for those posts now. I also note this isn’t just true of Presidents. My fellow Angry Bear, Spencer, once pointed out that there are a lot of people out there who seem to think we’d all be better off if the country was Alabama than if it was Massachussetts.)

Unfortunately, tax burden data, like any other bit of real world data, fluctuates somewhat from year to year, so its really going to be a while before we know what direction they’re really headed over O’s administration. As in, several years. And most of us are impatient. So we’d like to have some leading indicators, so to speak, of what Obama is going to do, of where he’s going to fall on the one R v. D divide that really matters. And right now, he’s behaving like the folks who have cut tax burdens in the past. He’s also talking like them. His bail-out is identical to GW’s, and when he talks about taxes, it doesn’t sound like Clinton, it sounds like GW. So its reasonable to wonder whether he’s going to stick to the R v. D rule. And the next test coming up is healthcare; a D would be putting his political capital on the public option right now. An R wouldn’t. What’s it gonna be, we’ll soon see.

More below the fold.

Now, in Megan’s post, she refers to “Cactus and his merry band of madmen.” I’m not sure the merry band of madmen over here truly have a leader, much less that I’m the one (Dan is the official grand poobah in charge of the blog, after all!!) but I’m guessing you aren’t a part of that merry band of madmen if any of the following apply to you:

  1. You do not believe that since 1929 at least, every single D has increased the tax burden and every single R has decreased the tax burden, despite the fact that the data shows precisely this, and despite the fact that it fits the caricature of Ds and Rs to a T, so to speak.
  2. You do not believe that since 1929, Ds have generally outperformed Rs when it comes to real economic growth, despite the fact that the data shows precisely this.
  3. You do not believe that administrations that cut the tax burden have also generally been the administrations that grew more rapidly, despite 1. and 2.
  4. You do not believe that the tax burden could possibly have anything to do with growth.

If you do believe these things, if you believe what the data shows , I’m sorry to say but you’re one of us, one of the merry band of madmen. On the other hand, if you fit these rules, there are a whole lot of folks out there, Megan McArdle included, who would consider you sane.

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Clearly a Commie-Symp Terrorist

Who said:

The United States participated actively and effectively in the negotiation of the [1984 UN Convention on Torture] . It marks a significant step in the development during this century of international measures against torture and other inhuman treatment or punishment. Ratification of the Convention by the United States will clearly express United States opposition to torture, an abhorrent practice unfortunately still prevalent in the world today.

The core provisions of the Convention establish a regime for international cooperation in the criminal prosecution of torturers relying on so-called ‘universal jurisdiction.’ Each State Party is required either to prosecute torturers who are found in its territory or to extradite them to other countries for prosecution.

Answer here. Is he rolling over in his grave?

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Attention Republicans/Blue Dog Democrates: Tax cuts as stimulus work against your goal

by Divorced one like Bush

I think it’s time to reread the World Bank report on what creates wealth because it seems that the arguments against the stimulus are from a mind-set of very narrow thinking about what creates wealth. They all seem focused on what the World Bank report calls “Produced Capital”. Unfortunately, focusing on just that aspect of capital reduces our nation to growth based on 18% of our economic power. And, as far as I have understood the arguments for tax cuts, they are based on effecting this small aspect of what produces wealth in a developed economy like ours.

“The rest of the story is intangible capital. That encompasses raw labor; human capital, which includes the sum of a population’s knowledge and skills; and the level of trust in a society and the quality of its formal and informal institutions. Worldwide, the study finds, “natural capital accounts for 5 percent of total wealth, produced capital for 18 percent, and intangible capital 77 percent.”

You know what that is? Democratic traditional spending priorities.

“Rich countries are largely rich because of the skills of their populations and the quality of the institutions supporting economic activity,” the study concludes. According to Hamilton’s figures, the rule of law explains 57 percent of countries’ intangible capital. Education accounts for 36 percent.”

Get that? It means tax cuts are just stupid policy if the goal is to stimulate a developed economy as strongly as possible such that the stimulus creates lasting wealth. Is that not the complaint by the republicans and blue dogs, the lack of lasting wealth which means jobs as the stimulus is written? What the World Bank report means is, if you want the biggest bang for your greenback, you have to weigh the heavy side of the stimulus to invest in “human capital, which includes the sum of a population’s knowledge and skills; and the level of trust in a society and the quality of its formal and informal institutions.”

You have to load the stimulus to the 77% side and not the 23% side (natural 5% and produced capital 18%). That is 3.4 human capital to 1 natural/produced capital. That means education (all forms and subjects), support for the economically disadvantaged (welfare, medicaid), health care (medicare, national health payment reform, system IT), risk prevention and recovery (law, fire/rescue, FEMA), science (greening energy, environment) and the arts (art districts, museums) to suggest a few.

Beyond that, the intentional campaign to sway public opinion by purposefully lying about the way a stimulus such as is being proposed will function, is to actually predestine our efforts to failure. The reason is because the campaign is producing a lack of trust.

“An economy with a very efficient judicial system, clear and enforceable property rights, and an effective and uncorrupt government will produce higher total wealth.”

As noted above, the level of trust in a society of its institutions is of issue regarding the level of capital available to produce wealth. The greatest harm that is coming from the republican’s drive to instill their minority will on the many out of selfish want, is to further the demise of the people’s trust. For the blue dogs it is their ignorance of their economic ideology that creates the mistrust. The republicans/blue dogs, and those helping them by lending their “professionalism”, think they are only effecting a political strategy. In truth, they are destroying the very basis for the wealth they desire. Their entire campaign for decades to discredit, to instill mistrust in the primary institution we have, the US (We the People) government, has been the primary cause to our economic decline. To increase the level of distrust is to decrease the available “intangible capital” which is 77% of our wealth generating power.

Pushing tax cuts, dear republicans and blue dogs, is actually working against the economic goal you profess to desire for the American people because enacting tax cuts promotes the weakest power of our economy while the promoting of tax cuts is destroying the strongest power of our economy.

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Once is History, Twice is Parody and Ignorance

Gary Farber (so far only via Facebook) (UPDATE: Now here) finds a reprint from the 8 March 1933 issue of The Nation:

At the risk of gilding the tinsel, let the record be set down finally as The Nation takes leave this week of the “only party fit to rule.” American memories are short. Four years from now the public will be asked to restore the Republicans and prosperity.

Let it therefore be recalled, now and henceforth, that four years ago not a cloud even as large as a man’s hand had appeared in the heavens. That it was, from the financial standpoint, a clear blue sky may have had a certain prophetic symbolism which was overlooked at the time. Herbert Hoover was about to assume the Presidency….

In his acceptance address the previous August Mr. Hoover had declared:

We in America today are nearer to the final triumph over poverty than ever before in the history of any land. The poorhouse is vanishing from among us. We have not yet reached the goal, but, given a chance to go forward with the policies of the last eight years, and we shall soon, with the help of God, be in sight of the day when poverty will be banished from this nation. There is no guaranty against poverty equal to a job for every man. That is the primary purpose of the economic policies we advocate.

Unfortunately, as Paul Wolfowitz observed, policies should always be evaluated by their results, not their purposes.

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Reasons to be Cheerful

Ken Houghton

Christopher Buckley leads the Republican Party to water, and speculates on watching them sink:

…GOP pin-up girl Sarah Palin.

I’ll stipulate that that’s condescending, if my former confreres on the Right will stipulate that had Gov. Palin’s first name been “Bob” or “Chuck,” her surname would still be unrecognizable to 90 percent of the American electorate.

The other pull quote was pulling and sits in the center of the article. While I encourage you to Read the Whole Thing, it really is too delicious not to requote as well. Rendered by Buckley as a parenthetic:

Nexis and Google have so far failed to unearth evidence of any previous candidate for the U.S. vice presidency being called—by their own campaign, no less—a “whack job.”*

Read the Whole Thing, including some of the comments.

*One guesses that memories of Admiral Stockdale, besides whose accomplishments John McCain looks like the inept cadet he was, have escaped Google and Nexus, since he was surely called the equivalent or worse.

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Is Douglas Holtz-Eakin still an economist?

Via Dr. Black, we get CNN reporting:

Younger, healthier workers likely wouldn’t abandon their company-sponsored plans, said Douglas Holtz-Eakin, McCain’s senior economic policy adviser.

“Why would they leave?” said Holtz-Eakin. “What they are getting from their employer is way better than what they could get with the credit.”

And why is it better? Because of the tax credit that is going away.

But let’s be nice to a man who has, in the past few months, eliminated his credibility to ensure that no ex-GWBush Administration official retains his or her reputation after leaving office.* Let’s assume he’s telling the truth.

So the young, healthy workers stay with the employer plan (that, miraculously, doesn’t go away in a miasma of Moral Hazard**). This leaves the older workers, who no longer get a decent deal from their employer, to find something in the marketplace.

Gosh, guess what happens when your selection group becomes more Adverse? Costs go up.

So let’s review what Holtz-Eakin has actually declared, explicitly and by implication:

  1. Younger workers will keep the employer-provided health insurance, since it would cost them more to buy on their own
  2. Older workers won’t be provided with insurance, and it will cost them Even More than More to buy health insurance on their own.

Even if we were ignoring that Health Insurance is NOT HEALTH CARE,*** John McCain’s proposal, by the admission of his own Economic Advisor, makes the current situation appear Pareto-optimal.

Which leaves us only one question: Why would any economist support it?

*I should probably stipulate positive here. For instance, anyone who followed Condi “I was National Security Advisor on 11 Sep 2001” Rice’s prior career wouldn’t have expected much from her.

**Using the actual Health Economics definition here, not the generic phrase to describe why we need to give Goldman Sachs and Jamie Dimon $700 Billion.

***Yes, I’m shouting. Claiming to address health care when all you address is health insurance is like claiming to have fixed a smashed-in door by changing the lock on it.

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