Friday, July 29, 2011

Wanted: A Leader

The dysfunctional body that is the United States Federal Government demonstrated once again that it is incapable of governing.
With the country on the brink of economic disaster House Republicans postponed a vote on the Boehner Plan to raise the debt ceiling.  In a direct challenge to the Speaker’s authority Tea Party members refused to give the Speaker the votes he needs to move the bill forward.  The House will meet again today to try to whip the necessary votes.  All of which is much ado about nothing as the bill is dead on arrival in the Democratic Senate.
People talk about what will happen if Congress does not strike a deal by the August 2nd deadline.  The fact is the damage is already done.  The trivial posturing and partisan politics rampant in Washington has infused an already weak economy with uncertainty that it cannot withstand. 
The economic reports released this morning show that the GDP grew only 0.4% in the first quarter and 1.3% in the second quarter.  The rating bureaus have already questioned the government’s ability to fix the problem.   It is now being reported that given these horrendous GDP results and the governments dithering with the problem, the rating bureaus will downgrade the county’s AAA rating regardless of the details of a debt ceiling compromise.
People are not spending money.  All of the opinion polls clearly show that Congress is taking the country down the wrong path.  The CEO’s of several of the country’s major banks wrote a joint letter to Congress stating that this political grid lock is hurting business and investment.  And yet the politicians continue to put ideology ahead of the good of the country.
How did things get so bad?
In our opinion we are here due to a lack of leadership.  There is no one in Washington willing or able to make the politically unpopular decisions for the good of the country.
Let’s start with the Speaker.  He has been trying to wrangle his Tea Party members for months.  His problem is that the Tea Party members did not get to Washington because of John Boehner…they got there in spite of him.  Boehner campaigned against the Tea Party in 2010.  He saw them as a small group of radicals without substantive policy or backing. But they got elected, and now they hold the fate of the party in their hands.  They owe Boehner nothing.  Believing they had correctly gauged the mood of the country they overplayed their hand.  Boehner had a sweet 3 to 1 spending versus revenue deal in his pocket.  But the Tea Party, believing they could get more, rejected it.  Boehner is powerless to stop them.  And now his Speakership is in question.
The President has fared no better.  He and his party controlled the Presidency and both houses of Congress for two years… and failed to pass a budget.   As the country continued its reckless spending practices the President caved to political pressure and extended the Bush tax cuts, ramped up the war in Afghanistan and refused to tackle the primary source of our debt; entitlement reform.  As the debt ceiling debate began he was unable to prevent the Tea Party from attaching future spending cuts to an increase in the debt limit.  He didn’t… or couldn’t… make the logical point that the debt ceiling was about paying for purchases already made.  Even the most simple minded of us knows that when you use your credit card to charge a purchase you have to pay for it eventually.  Apparently the President was unable to make that point to the Tea Party folks.  He allowed them to hold the debt ceiling increase hostage.  During the negotiations he played cute by half, refusing to offer his own specific plan and tossing out entitlement cuts that he knew would never be made.  Now that the clock is approaching the eleventh hour he has remained silent.  Even members of the Democratic caucus wonder why the President hasn’t weighed in on a daily basis.
We got in this mess due to a lack of leadership.  It is now apparent that there is no one capable of leading us out. 


Thursday, July 28, 2011

The Games Continue

The Kabuki theater that is Washington politics continues today much to the detriment of the American people.
The House will vote today on Speaker Boehner’s plan to raise the debt ceiling.  The plan is doomed to failure in the Democratic Senate but the vote will be taken to give Boehner’s caucus political cover with their constituents.  Boehner addressed his caucus yesterday challenging its Tea Party members to “get their ass in line and pass this bill.”  Senator John McCain also challenged the Tea Party.  Returning to his plain spoken “maverick” days McCain took the Tea Party to task for attempting to pass a balanced bill amendment prior to the August 2nd deadline.  He called their efforts “foolish” and “unfair to the American people” referring to the Tea Party freshman as “hobbits who should return to middle earth.”
If the Boehner bill manages to pass the House it will go to the Senate where it is certain to fail.  Harry Reid and his Democratic majority will then amend it to their liking and pass it back to the House… where it will fail once again.  That will leave little in the way of options other than “a clean vote to raise the debt ceiling without any spending cuts or revenue increases attached.”
There are some who feel that the President has played a major role in this fictional drama.  The New York Times and others on the left have criticized the President for caving into the Tea Party demands.  They say that he has failed to lead and shown once again that his desire to be compromiser-in-chief takes precedent over fighting for the promises he made as a Presidential candidate. But there are others who believe that this has all been for show.  They believe that the President offered cuts in entitlements knowing full well that they would never pass in the Democratic Senate; but offering them elevated the President to the lofty position as the only reasonable adult in the room.  They believe that in the end the Grand Bargain was a sham and all that the President ever wanted was “a clean vote to raise the debt ceiling without any spending cuts or revenue increases attached.”
While all of this gamesmanship may serve as red meat for pundits and political wonks it is having a disastrous affect on the American people.  While Congress continues to play their little political games the DOW dropped for the fourth straight day falling almost 200 points at yesterday’s close.  Americans watched their investments and 401k’s drop by over $100 billion dollars in those short four days.  While Congress continues to offer witty snippets to the media unemployment stands a t 9.2% and foreclosures continue to mount.   
Congress continues to focus on the politics.  They talk about cuts in entitlements or education or unemployment benefits as if they are poker chips to be bet in a game of chicken. 
They seem to have lost sight of the fact that those poker chips have a very real affect on people’s lives.             

Wednesday, July 27, 2011

It's All About The Tea Party

 It is admirable to stick to one’s convictions.  It is admirable to feel so strongly about one’s beliefs that you are willing to withstand withering criticism on principle.  But when it becomes apparent that you are the only one who holds those beliefs sacred you need to do a little self evaluation.  You need to consider that your views might be in the minority.  You just might have to compromise your beliefs for the good of the other folks in the room.  Such is the state of the Tea Party Caucus.
The 87 freshman members of the Tea Party Caucus have successfully brought the Speaker of the House, the President of the United States, the United States Congress and the United States of America to their knees.  They have for all intents and purposes brought the federal government to a halt as the House and Senate try to find a debt ceiling plan that will assuage the Tea Party Caucus.
The Tea Party has been very clear in what they want.  They want lower taxes.  They want smaller government.  They want to eliminate entitlements and slash social programs.  As Grover Norquist said they want a government small enough that they can “drown it in a bathtub”.  That is their bottom line…and they really don’t care who gets burned by their scorched earth policies…including the full faith and credit of the good old USA. 
Many Tea Partiers believe that the debt ceiling should not be raised under any circumstances.  They don’t believe default would be catastrophic; in fact they believe it would be good for the country.  They believe default would force the country to live within its means.  And they have not wavered one iota from those beliefs.
Democrats and Republicans alike have offered several plans to rein in spending and solve the debt ceiling problem.  The Bowles- Simpson Plan, The Biden Plan, The President’s plan, the Gang of Six Plan, The Obama/Boehner Plan and  The Cut, Cap and Balance Plan; every one rejected by the Tea Party. Even the plan which their elected Speaker personally drew up yesterday was rejected as lacking in sufficient spending cuts.  They maintain their beliefs even when pressed by overwhelming opposition.
Every opinion poll shows that a vast majority of US citizens disagree with the Tea Party Caucus.  62% of Americans believe that failure to raise the debt ceiling would bring serious financial consequences.  68% believe that the richest 2% of Americans should pay more taxes.  72% of Americans believe that a debt ceiling deal should include spending cuts AND increases in revenue.  It doesn’t matter to the Tea party Caucus.  They and they alone know what’s best for America.
Congress will work around the Tea Party and cobble together enough votes to reach an eleventh hour debt ceiling  compromise…and the President will sign it.  They have no choice.   It won’t be a good deal.  In fact it will be a bad deal for the country because it won’t begin to solve the nation’s long term financial problems.  But it will be a done deal; and a sigh of relief will be heard throughout the nation’s capital. 
The fallout from this weak compromise will fall squarely on the shoulders of the President…as it should.  We believe whatever happens on a President’s watch…both good and bad… is his to bear.  He is the Commander-In-Chief and the leader. Many wish that he had the strength of conviction exhibited by his Tea Party foes.  But this is a President who is more about finding common ground than twisting arms.  After all, the debt ceiling deadline has been looming for over nine months.  So it should come as no surprise that something would have to be done to raise it in time.  To be putting millions of Americans at risk while those elected to make tough decisions play Romper Room politics is unconscionable.  The lack of leadership in Congress and in the White House has been an embarrassment both here and around the world.
But the Tea Party Caucus can hold its head high.  They stuck to their convictions; and in the end their reckless, intransigent behavior brought the country to its knees.  Well done.             

Tuesday, July 26, 2011

Much Ado About Nothing

When we heard that the President was going to address the nation on Monday night we were filled with hope.  We anticipated that the President’s purpose was to announce that a compromise had been reached on the debt ceiling and that financial disaster had been avoided.
Imagine our surprise when the President stepped up to the podium and repeated the same political talking points that we had been hearing for the past several weeks.  The President favors a “balanced approach” including spending cuts AND increases in revenue.  Nothing new here.  The Republicans want to solve the deficit problem on the backs of the poor and the middle class.  Nothing new here either.  The President wants those who agree with his approach to contact their congressman and make their voice heard.  That’s new…but weak.
Then the President said that he supported the plan crafted by Senate Majority Leader Reid.  Curious because Reid’s plan gives the Republicans everything they want….spending cuts WITHOUT any increase in revenue.
Speaker Boehner followed the President with a short rebuttal.  His comments were full of inaccuracies and amounted to little more than a personal attack on the President.  They were also redundant as the President was giving Boehner everything he asked for.    
The President was he usual eloquent self.  But his message was last week’s news.  The Grand Bargain is dead.  The President is not going to get the revenue increases that he desires.  The Tea Party members have successfully framed the debate.  The debt ceiling will be increased.  There will be cuts in spending.  And the top 2% wage earners in the country will continue to pay a lower percentage in taxes than their secretaries.  The only question is whether the length of deal will be long enough to take us through the next election, as the President prefers; or will the Republicans get their way and force the nation to go through this debate again in six months.  Our money is on the Republicans.
There was no news Monday night.  This was a night for more of the same...partisan politics and political talking points.  The President won the debate over style but it appears that he has lost the debate over substance.

Monday, July 25, 2011

The Damage Has already Been Done

The big news coming out of Washington this past weekend is that there is no news.  Nothing happened.  With the clock ticking down toward economic Armageddon the Washington version of Romper Room continued as Democrats and Republicans failed to reach a compromise on the debt ceiling crisis.  Instead they retreated to their respective corners to craft rival plans to increase the deficit. Nothing says compromise like rival plans crafted secretly behind closed doors.
This is serious stuff.  Yet the ramifications of failure and the urgency of the situation seem lost on Congress.
There are 8 days remaining before the August 2nd deadline.  If a deal is not reached by then the country will default on its obligations.  The disastrous economic consequences of such a default would be felt both here and abroad.  Interest rates will skyrocket, the stock market will decline and the value of the dollar will be diminished.  In fact many economists feel that the dollar will cease to serve as the reserve for the world’s currency. 
The bond rating bureaus have already voiced their concerns.  They have placed the country on a “watch” basis and have clearly stated their intent to lower the county’s AAA rating if a long term deal is not reached. 
How does Congress respond?  Boehner walks out of negotiations at the eleventh hour and accuses the President of being more concerned with re-election than the good of the country. Nothing says compromise like walking out of the room and sniping at the opposition.  Helpful!
In fairness, Boehner is not alone.  The airwaves have been full of caustic one-liners from both parties.
Unfortunately, the world is watching.  While our politicians hide behind their ideology and make political points with witty commentary the world is losing confidence in America.  Voices all around the world, from pundits to economists to world leaders are all questioning whether our current way of governing is capable of making big decisions.  They cite not only the current debt ceiling conflict but our erratic policy decisions both domestically and internationally.  While we fight amongst ourselves the world has past us by in education, research and development, infrastructure, investment, infant mortality and quality of life.  The country that rebuilt the world after WWII can no longer take care of itself.  Thanks to our political polarization the country our parents and grandparents fought for no longer exists…and the world knows it.
In many respects the August 2nd deadline really doesn’t matter.  The damage has already been done.


Saturday, July 23, 2011

Boehner Takes A Hike

Speaker Boehner has left the building…again!
 In a stunning reversal, amidst rumors that a deal was eminent, House Speaker John Boehner announced that he was pulling out of negotiations with the White House.  He said that, contrary to rumors, a deal was never eminent, that the White House had “moved the goalposts” and that he would turn his efforts toward crafting an agreement with his colleagues in the House and Senate.  He re-iterated the Republican talking points that any deal to raise the debt ceiling would not include an increase in taxes.
Yesterday rumors swirled around Washington that a major deal was in the works.  The deal supposedly included major concessions by the White House on entitlements.  It also was rumored to include concession by Republicans on revenue.  Nobody knew for sure because talks had been conducted behind White House closed doors.  Lawmakers on both sides were furious; angered at being kept in the dark and fearful that their side had given too much to get too little in return.
The President was awaiting word as to whether Boehner had been able to receive the blessing of his caucus.  When the call didn’t come the White house contacted the Speaker’s office.  Promised a return call the White House waited.  After waiting 24 hours for a return call the White House called again at 3:30 yesterday afternoon.  They were told that the Speaker would not take the call, but he would call the President at 5:30.  Speaker Boehner called the President at the appointed time and informed him that he was pulling out of negotiations.
A visibly frustrated President conducted a press conference not 30 minutes after receiving Boehner’s call.  He laid the blame for the lack of a deal squarely at the feet of the Republicans.  He said that while he was willing to take the heat from his own party in making tough choices Boehner and Cantor were not.  “I’ve been left standing at the altar a couple of times now” he said. He laid out the details of the proposed deal that included $1.6 trillion in spending cuts and $1.2 trillion in revenue increases without changing the tax rates.  For 35 minutes he took his case to the American people; chastising Republicans for being more concerned with opinion polls, radio talk show hosts and pledges than they were with “working stiffs who just can’t seem to get ahead.”  He also took his shots at Boehner.  Referring to the difficulties Boehner was having with members of his own caucus the President said “At some point, I think if you want to be a leader...then you've got to lead."  Asked what he would say to assuage the concerns of the financial markets, he said: “I am confident that we will raise the debt ceiling.  Default is not an option.  But I think we can do more.”
There are those who believe that from day one this has all been Kabuki Theater on the part of the President.  That all the President ever wanted was a clean increase in the debt ceiling without any spending cuts or tax increases attached.  They believe that the President proposed the cuts in entitlements in exchange for tax increases because he knew that Boehner could never get his Grover Norquis pledge signing Tea Party members to agree.  He knew that they would hide behind their stubborn ideology and leave him there standing at the altar…the only reasonable adult in the room.  If that is the case, if this has all be an elaborate production, then he has certainly played his part well. 
The President has ordered the House and Senate leadership back to the White House today where “they will tell me how THEY propose to fix this problem.”
Get your popcorn ready.  It’s going to be a show.     


Wednesday, July 20, 2011

A Bi-partisan Waste Of Time...And Money

The Bi-partisan “Gang of Six” recently issued their plan to cut the deficit.  Basically the plan would cut the deficit by $3.7 trillion dollars while increasing revenue through the elimination of tax loopholes.  The plan which includes a restructuring of the US tax code has been supported by the President and a number of Republicans leading pundits to report that perhaps a larger deal can be crafted.  The Dow reacted favorably signaling the markets haven’t lost all hope…yet.
The Gang of Six plan is the latest in a whole host of deficit reduction plans that have been presented over the past several months.
The first plan was crafted by the President’s own commission.  It was called the Bowles-Simpson plan and was hailed as a tough, realistic bi-partisan plan to reduce the deficit.  The President inexplicably ignored it as did the rest of Congress.
The President then gave the State of the Union address during which he presented his own budgetary vision for the country.  Naturally that plan was dismissed by conservatives.
Then came the Republican alternative known as the Ryan Plan.  The Ryan Plan included provisions to cease Medicare and Medicaid as we know them.  Naturally that plan was dismissed by progressives.
The aforementioned Gang of Six was formed by a bi-partisan group of Senators to find common ground on the deficit.  The Gang of Six quickly became the Gang of Five when one member, Tom Coburn, quit over the lack of progress.  But they got back together later to reform the Gang of Six.  We detailed their deficit proposal earlier.
The President took another crack at the deficit with a major address to the country on the economy.  His remarks were once again dismissed by conservatives.
The President then tasked Vice President Biden with putting together a ANOTHER bi-partisan committee to tackle the deficit problem.  (Isn’t that what Bowles-Simpson was?) Only two republicans were willing to serve on the committee.  Then one of them, Eric Cantor, quit.  He was soon to be followed the other Republican, John Kyl thereby taking the “bi” out of bi-partisan.
The President then ordered the Congressional leaders to the White house where he laid down the law and told the leaders it was time to “eat our peas.”  With the President leading the negotiations the dialogue disintegrated into a fifth grade food fight.  Things got so tense that bad boy Eric Cantor managed to piss off the normally cool, calm and collected President.
Senate Minority Leader Mitch McConnell then offered yet another plan that would give the President the power to increase the debt ceiling on three separate occasions while giving the Republicans the opportunity to save face by recording their descent against each increase.  This is considered a back-up plan in case everything else goes to hell.
The Tea Party Republicans then put together a bill which is referred to as the Cut, Cap and Balance bill.  (Democrats would later label it Duck, Dodge and Dismantle.)  The conservative bill cut 2012 spending, capped future spending at 18% of GDP and proffered a balanced budget amendment to the constitution.  It also established ANOTHER committee to seek future spending cuts.  The bill passed the Republican led House.  It has no chance in the Democrat led Senate.
Now the politicians, including returning prodigal son Tom Coburn, are examining the Gang of Six bill.  Most seem to agree that given the bills complete overhaul of the tax code, there won’t be enough time to properly score the bill before the Aug 2nd default deadline.
So after all of this the country will probably get a short term extension of the debt ceiling so the debate can continue.
By our count there have been 10 separate deficit plans offered by our elected leaders.  Each has been ignored while another is put in its place.  In the end a comprehensive long term solution won’t be reached because the clock will have run down.  The only thing that they will have accomplished by Aug. 2nd is to kick the can down the road once more while wasting millions in taxpayer funds in the process.
Is  there any wonder why most Americans feel that Washington is run by a dysfunctional gaggle of partisan misfits who are incapable of governing.


Tea Party Hypocrites

The Republican led House passed their CUT, CAP and BALANCE deficit plan yesterday.  Led by the Tea Party freshman, the bill cuts 2012FY spending by 50%; caps government spending at 18% of GDP and proffers a balanced budget amendment that would require a supermajority vote of 2/3 to pass any future tax increases.
The bill now moves to the Democrat controlled Senate where it has no chance of passing.  No matter.  These freshman can go home to their constituents and say with a loud and clear voice that they did what they were sent to Washington to do…pass legislation that cuts spending while holding the line on taxes.
If only these Tea Party freshmen had the strength of character to practice what they preach.  But they don’t.  In fact they are hypocrites.  At the same time that they were railing against big government spending they were trying to get millions of federal dollars for their pet projects back home.
Ron Nixon, columnist for the New York Times, reports that an examination of spending bills, news releases and communications with federal agencies obtained under the Freedom of information Act shows that many of the freshman have sought money for projects that cost billions of dollars, while calling for less spending and banning pork. 
Nixon cites Republican Rep. from South Carolina Tim Scott’s efforts to acquire federal funds for a harbor dredging project in his hometown of Charlestown.  He cites a bill co-sponsored by Republican freshman Sean P. Duffy from Wisconsin and presidential candidate and Tea Party favorite Michelle Bachman from Minnesota, pushing for funding for a four-lane bridge over the St Croix River.  Nixon reports that last March, while the House was drafting the defense authorization bill, 22 freshman Republicans wrote a letter to the House leadership requesting more defense spending than Obama had requested.
The Tea Party freshmen like to talk out of both sides of their mouths.  They decry federal spending and threaten to allow the country to default if they don’t get their way; while they lobby for earmarks and pork projects for their hometown constituents.
The Tea Party patriots of revolutionary times had courage and conviction.  They were willing to fight and even die for their beliefs.  As for the Tea Party members that roam the halls of Congress today…not so much.         

A Comment On Rupert Murdoch

We have been asked why we have refrained from commenting on the whole Rupert Murdoch affair.  The answer is quite simple.  Our focus has always been on American politics and the Murdoch “Crises” has seemed to us a whole lot more like Entertainment Tonight than 60 Minutes.  But in light of yesterday’s wall to wall coverage of the Murdoch’s appearance before Parliament we acquiesce.   
We watched a bit of the testimony and listened to a number of the after action reports and we came away wondering why this scandal comes as such a surprise.
Rupert Murdoch has built a multi-billion dollar news organization that has wielded huge influence within Great Britain for decades.  You can’t govern in England without the backing of Murdoch’s press.  It is well documented that Mr. Murdoch rubs shoulders with Prime Ministers and holds great influence among the members of Parliament.  Murdoch’s vast holdings within the press provide him with incredible power to make life miserable for any politician who crosses his path.  And Murdoch has never been shy about exercising that power.  Now that Murdoch’s empire is in trouble we see the same politicians who curried his favor treating him like a leper.  No surprise there.
As for the members of Scotland Yard, no surprise there either.  History is full of examples of members of law enforcement cutting deals with the press.  Again, given Murdoch’s vast empire it is not surprising that the tentacles of his organization extended deep within Scotland Yard; all the way to the highest levels.  Murdoch doesn’t deal with underlings.
It has been well documented that Murdoch is a tough hands on type of manager.  He is known for calling his editors at all hours of the night to discuss the content of the next day’s editions and to verify sources.  Therefore we found it quite entertaining to watch Murdoch play the role of frail octogenarian unable to remember specifics and unaware of the sleaze rife within his empire.  To believe that Murdoch was unaware of the tactics being used by his staff or the millions his company paid in out of court settlements strains credulity. 
The news business is a very competitive business.  As such reporters will often sink to questionable measures to get a story.  The swarming paparazzi and the sleaze of the tabloids are an integral part of British society.   The Murdoch news organization has been a major player in that arena for decades. 
It has been said that the marching orders within Murdoch’s news organization are quite simple:  “get the story…I don’t care how you get it, just get it…make it happen.”  It is the culture of the British press.  It is a culture that is swarming, sleazy and not bound by fact or credibility; a culture that made Murdoch billions.
Yesterday Rupert Murdoch learned firsthand what it feels like to be the target of that culture.                

Tuesday, July 19, 2011

Americans Are Tired Of CYA Politics

The Republican lead House is expected to vote today on the Tea Party’s plan to raise the debt ceiling.  The legislation is called the CUT, CAP and BALANCE Plan and it includes the following provisions:
CUT - cut the 2012 Fiscal year deficit by 50%.
CAP – cap spending at 18% of GDP.
BALANCE – authors the passage of a balanced budget amendment to the constitution including the requirement of a supermajority (2/3) vote to pass any increase in taxes.

In exchange for passage of this plan the Republicans would allow the President to raise the debt ceiling by $2.4 trillion dollars; thereby avoiding a default on the country’s obligations.

Sounds good, right?  The plan cuts spending while forcing the government to live within its means.  And it keeps taxes low for all eternity.  Perfect!

So what’s the problem?  Why all the fuss from the left?

Because cutting the 2012 fiscal year spending by 50% would cause 700,000 more Americans to lose their jobs.

Because capping spending at 18% of GDP would force the government to adopt the cuts of the much, maligned Ryan Plan.  Medicare would become a voucher system and cease to exist as we know it.  Medicare would be turned over to the states under a block grant program.  And education, unemployment benefits and other social programs would be slashed or eliminated in their entirety. 

And finally, because the balanced budget amendment and supermajority vote are designed to hold the debt limit hostage and lock in the budget to permanently reflect the Grover Norquist and Tea Party vision of what this country should be.

The Republicans know full well that this plan has zero chance of passing in the Senate or avoiding the President’s veto.  But they will go through the charade so they can go back to their constituents and say “we tried to do what you sent us to Washington to do but the Democrats and the President would not give up on their expensive free spending ways.”  Then the Republicans will come back to the table and negotiate a deal to avoid default.

It is already happening.  Even as Republicans were preparing to for today’s vote Speaker Boehner and Majority Leader Cantor were secretly meeting with the President to craft a compromise.  No word on the results of their Sunday conference but you can bet Cut, Cap and Balance were not part of the discussion. 

So why all of the theatrics?  Why the smoke and mirrors?

Because Congress is dysfunctional and CYA politics has become the norm.  Getting re-elected is more important than anything; even if it means jeopardizing the full faith and credit of the United States government.

The American people are becoming more and more frustrated with the inability of Congress and the President to do what is right for the country.  According to the latest USA TODAY/GALLUP poll the GOP approval rating stands at 28%.  The President fairs a little better at 33%.  The country is fed up with the behavior in Washington.

Once again a newly elected Congress has misinterpreted the will of the people.  They have not learned the lessons of their predecessors. 

Democrats made the same mistake in 2008.  The President gave Pelosi the keys to his stimulus program.  Swept into the majority with the historic election of our first black President the Democratic Congress loaded the stimulus package with every piece of pork that they could find.  The voters were outraged and they voiced their displeasure by removing the Democrats from the majority in 2010.

Now come the Republicans.  They vowed to cut spending, lower taxes and shrink the size of government.  So confident were they in their beliefs they dared to suggest an overhaul of the previously sacrosanct entitlement programs.  They misinterpreted their ascension into power as a mandate to gut the government.  They proposed the Ryan Plan and were quickly taken to the woodshed by the American people.  The voters will not speak officially until 2012; but it is clear that they are not happy that the Republicans have placed their ideology above the good of the country.

At the end of the day the games will end and debt ceiling will be increased.  Sadly the “Grand Bargain” that seemed so promising just a few days ago will be replaced with a much smaller deal that will kick the larger problems down the road.  The politicians will make bold face saving statements trumpeting their compromise.  Everyone in Washington will be a winner.  Only the American people will suffer a loss. 

It used to be that the economy affected politics.  Now, sadly, our politics are affecting the economy.  Ideology has prevented the country from moving forward and the dangerous game of political chicken has impacted our economic stability.

The American people are tired of all the games.  They will make that quite clear in 2012.



Monday, July 18, 2011

Missing The Point

The countdown to economic Armageddon continues this week as our political leaders squabble over increasing the debt ceiling.  Republicans are still adamant that any increase in the debt ceiling be matched with cuts in spending and without any increases in revenue (taxes).  Democrats are agreeable to cutting spending but they want an increase of one dollar in taxes for every three dollars of spending cuts.
Both parties are missing the bigger point.
We cannot pull ourselves out of this recession with spending cuts alone.  Nor can we tax our way out.  The only way to move this country from its economic malaise is to work our way out.  And nobody is talking about that.
The Obama administration deserves credit for halting the erosion of jobs in this country.  When the President took office we were hemorrhaging jobs at a rate of 400,000 to 500,000 per month.   Since then the job erosion has ceased and we have added over 2,000,000 jobs to the economy.  But unemployment is still at 9.2% and real unemployment hovers around 14-15%.  That is unacceptable and cannot continue if we are ever going to improve our economic fate.
Republicans defeated the President during the mid-terms by campaigning on jobs, jobs, jobs.  Since taking control of the House they have not offered one…not one…job creating piece of legislation.  They have been resolute in proposing anti-abortion bills and steadfast in making English our national language.  But they have done nothing on the job front.
The only way to get ourselves out of this recession is to work our way out.  And we have plenty of opportunities to do just that.  We have to re-invest in manufacturing, repair our infrastructure, rebuild our schools and modernize our methods of transporting commerce and people.  We need to make our country more energy efficient and independent.  Millions of workers will be needed to accomplish these tasks.  
The need is great.  The workforce is ready willing and able.  All we need are leaders with the vision and courage to seize the opportunity to do big things.
Fixing the debt ceiling problem is important.  But the bigger problem is the long term future of this country.  Whether you raise the debt ceiling or allow the country to default we are still going nowhere unless we set a path for the future; a path that rebuilds our country and puts our people back to work.
Investing in America and the American worker…that is how you fix the economy.
Everybody talks about jobs.  It’s time to do something about it.             

Friday, July 15, 2011

Are there Any Adults In The Room?

Enough already!  Stop!  Grow up!
These are just some of the random thoughts that go through our mind as we watch our elected “leaders” negotiate the debt ceiling limit.  It is as if the seriousness of this issue has been lost on them.
House Minority Leader Cantor rudely interrupts the President three times during negotiations.  The President bites his head off.  Cantor responds by publically throwing the President under the bus.  Senate Majority Leader Reid makes a speech in the well of the Senate publically criticizing Cantor, questioning why Cantor is even in the negotiations.  “Eric is all about Eric” he quotes a fellow Senator as saying.
What is this, romper room?  “You’re a dirty rotten so so”…”Am not”…”Are too”.  Watching this makes one wonder if these folks have any concept of the serious problem we are facing if they don’t do their job.
And this situation IS really, really serious.
Yesterday, Standard and Poors joined Moody’s in issuing a warning about the very real possibility that the US credit rating will be downgraded if our guys don’t raise the debt ceiling…now.  S&P placed the US credit rating on “Credit Watch with negative implications.”   The rating bureau said that there is a one in two likelihood that the S&P will lower the US credit rating in the next 90 days.  This follows a move in April where S&P changed its outlook on the country’s credit rating to “negative”.  Our politicians may be playing an ideological game of chicken in hopes of crafting a favorable deal, but these rating bureaus are not fooling around.
The thing that seems lost on these guys is that the debt ceiling must be raised; not so that we can take on new spending programs but rather to pay for the very commitments that these clowns already approved.  Our credit card has been maxed out to buy a whole host of things that Congress committed to.  Like the war in Iraq, the war in Afghanistan and the prescription drug program for seniors.  You don’t get to vote to go to war in Afghanistan and then decide that you don’t want to pay the guys fighting there.  The financial commitment was made when you swiped your credit card.  You’re in…no do overs. 
Millions of homeowners have unfortunately found themselves in this same position.  “I bought the house…signed the mortgage…now due to unforeseen circumstances I don’t have the money to pay for it.”  The banks don’t care.  They want their money.  The term they use is foreclosure.  This sad set of circumstances is playing itself out all over the country…and it is about to include the government of the United States of America.
Uninformed politicians like Michelle Bachman say we’ll just pay the interest on the debt to avoid default.  “No worries”.  But if we pay the interest and cannot pay our other meager obligations like Social Security, Medicare, Military pay, veteran’s benefits and federal employee’s wages, our lowered credit limit will be the least of our worries.
Everyone agrees that we need to cut spending.  The $56 trillion that we have committed to pay over the next decade must be addressed.  But holding the full faith and credit of the United States hostage for political gain is reckless and irresponsible.
So, c’mon guys, raise the debt ceiling so that we can pay our bills.  Then you can go back to your silly food fight.

Thursday, July 14, 2011

Ignoring The Elephant In The Room

Moodys announced yesterday that it has placed the United States AAA credit rating under review for a downgrade due to the country’s failure to raise its debt limit.  Standard & Poors had already placed the country on a negative outlook back in April; meaning that a reduction in rating would occur within the next 12-18 months if the debt ceiling were not raised.  A downgrade in the US credit rating would dramatically increase interest rates, inflate the country’s debt and cause a negative economic tsunami that would be felt worldwide.
Party leaders met with the President once again in an attempt to reach a compromise.  In what was described as a tense and fractious meeting, the President and Eric Cantor banged heads on the length of any deal.  Cantor wants a short term stop gap deal to get past the election season.  The President is entrenched in his belief that a long term 10 year deal is necessary to move the country forward.  “This may bring down my presidency” the President said, “but I will not yield.”  When Cantor interrupted the President for a third time, pushing the issue once again, the President pointedly said “don’t call my bluff.  I’ll take this to the American people.”  The President is said to have then abruptly left the room.  Those in the room called the meeting the least productive thus far.
While all of this drama is titillating and fun for the media; there is a mammoth long term problem that is being missed.
The parties are arguing over a deal that will not put a dent into our financial obligations.  The President likes to talk about a ‘Grand Bargain” that would cut $3 trillion from spending, increase revenue by $1 trillion and cut the deficit by $4 trillion dollars over the next ten years.  The Republicans want a much smaller deal focusing on $2 million in spending cuts and zero increases in revenue.
Here is what seems to be missing from the debate.  Here is the elephant in the room that everyone wants to ignore.
Our current deficit stands at $14 trillion dollars give or take a couple of billion.  But that does not include Social Security and Medicare checks that have to be cut over the next ten years.  Over the next decade we have unfunded Social Security obligations of $6 trillion dollars and unfunded Medicare obligations of $35 trillion dollars.    When added to the current debt we owe $54 trillion dollars in the next decade.  $54 trillion dollars!
Even if the President gets his $4 trillion Grand Bargain we will still have $50 trillion in unfunded obligations… and no plan to pay them.  To put it in perspective; each American would have to work for four years… FOR FREE…to pay off this debt.
There is no way to fix this long term problem without overhauling entitlements, cutting defense and raising taxes.  Anything else is whistling past the graveyard.  Those in the room know it.  They just lack the political courage to deal with it.
Over the past several months we have watched Washington squabble like school children over a $4 trillion plan that doesn’t begin address the financial difficulties that lie ahead.  How will they ever right the country’s mammoth long term problems if they cannot agree on something this insignificant?  The answer is they won’t; because all they care about is the next election. 
We have said it before and we’ll say it again.  These are not serious people.  They place party, politics and re-election over the good of the country.  Washington is broken and completely out of touch with the American people.


Wednesday, July 13, 2011

Kicking The Can Down The Road...Again

The debt ceiling negotiations get more convoluted with each passing day.
Yesterday, Republican Senate Minority Leader Mitch McConnell offered what he referred to as a “back-up plan” in case the two sides fail to reach an agreement before the August 2nd deadline.  
McConnell’s plan would in essence authorize the President to increase the debt ceiling in three incremental stages between now and the 2012 elections WITHOUT requiring any offsetting spending cuts.  In a face saving measure, the plan affords Republicans the opportunity to voice their disapproval of the debt ceiling increase.  It calls for Congress to vote on a “resolution disapproving” each incremental increase…which the President would naturally veto.  The plan also calls for the President to provide Congress with the offsetting spending cuts “he would SUGGEST making”… without actually requiring him to make those cuts.
McConnell may call this a back-up plan; but many are calling it a full scale capitulation.
So what happened?  What caused the Republicans to go from emphatically stating that they would not agree to ANY increase in the debt ceiling unless it was matched with offsetting spending cuts?  What happened to the full throated “no debt ceiling increase…period” from the Tea Party members?  Are McConnell and Boehner no longer listening to their base?
They are indeed.  But it’s not the Tea Party base that is bending their ear.  It is the Wall Street base that has grabbed McConnell’s attention. 
Wall Street is getting nervous.  They see the wild fire of economic ruin that is sweeping across Europe and they can feel the flames licking at their heels.  Moody’s just downgraded Ireland and Portugal to Junk bond status.  Italy, Europe’s third largest economy, is on the verge of becoming Greece.  Germany has been bankrolling the continent and can only continue for so long.  Is the US far behind?  Tea Partiers make a lot of noise and carry signs with funny slogans.  But Wall Street and big corporations pay the Republican bills and fill the Republican election coffers.  Wall Street wants this fixed; and they don’t want to risk waiting until the eleventh hour to close the deal.
McConnell has said from day one that his number one priority is to defeat Obama in 2012.  Not create jobs.  Not fix health care, or repair our infrastructure or improve our education system.  Defeat Obama.  In announcing his back-up plan he said there was no way to cut a deal "as long as  this President is in office."  So he’ll allow Obama to increase the debt ceiling and then spend the campaign season painting him as a free spending liberal who is driving the country further into debt.
And the can gets kicked down the road once more.    

Tuesday, July 12, 2011

Republicans Are Not About Small Government

The Republican Party is always preaching about the evils of big government and its intrusion upon the American way of life.  Ronald Reagan once noted “government cannot solve our problems…government IS the problem".  More recently, powerful Conservative lobbyist Grover Norquist said that he wanted a government that was just big enough “to drown in a bathtub.” 
While Republicans have been big on small government rhetoric their governing style has been anything but.  Republican led state houses across the country have enacted legislation that reeks of “Big Brother” gone wild.  They have eliminated the collective bargaining rights of public employees.  They have passed restrictive voter registration laws that impede dissenting voter turnout.  They have re-written the education curriculum to more accurately reflect their conservative views of history.  They have restricted women’s rights to legal abortion services by closing down clinics that fail to meet arbitrary architectural requirements.    And they have sent their “Emergency Risk Managers” into struggling towns and townships, fired the local elected officials and annexed property for political and economic gain.
The controlling management style extends to their politicians as well.
The aforementioned Grover Norquist has brow beaten every Republican member of the House to sign a pledge saying that they will not vote for tax increases…ever.
An ultra conservative group called “Family Leader”, fearful of the disintegration of the sanctity of marriage has pressed conservative candidates to sign their “Marriage Pledge”.  In the pledge candidates vow to practice sexual exclusivity to their spouse and to speak against same sex marriage, abortion, quickie divorces, women in combat and Sharia law. 
So much for freedom of speech and expression.
The Republican Party of Ronald Reagan would be a bunch of liberal wackos compared to this group.
So if you are looking for small, limited unobtrusive government…vote Republican??   


Obama Shows Leadership; Puts Country Ahead Of Party

The President held a news conference yesterday.   Exhibiting the leadership qualities that his critics have long questioned, the President made it clear that he was willing to take the heat from his own party and move beyond ideology in order to get a deal.  He challenged Republicans to do the same.
The President made it clear that entitlements, the sacred cow of Democratic politics, were on the table.  But he said that changes in entitlements and domestic spending cuts had to be met with increases in tax revenue from the wealthiest citizens.  He made it clear that he would veto any short term deal which “would just kick the problem down the road for future generations.”   “It’s time to eat our peas” the President said.  “If not now, when.  It’s not going to get any easier.”
The Republicans dismissed the President’s comments as little more than campaign rhetoric.  Speaker Boehner scoffed at the President’s words, calling his demand for increased revenue “job killing tax increases.” “The way to resolve the debt issue is to grow the economy, increase jobs, cut taxes and broaden the base.”  “It takes two to tango”, the Speaker said.
The Republicans have an internal problem and it is impeding a deal on the debt ceiling.  Speaker Boehner and traditional Republicans are open to a compromise.  But they are thwarted at every turn by Majority Leader Eric Cantor and the 87 Tea Party freshmen members who refuse to raise the debt ceiling under any terms.  Boehner and Cantor do not get along. Their brazen attempts to throw each other under the proverbial bus are almost comical.  Boehner sent Cantor into the Biden Deficit Talks hoping Cantor would shoulder the blame and incur the Tea party wrath for any compromise that included a tax increase.  Cantor walked out, showing up Boehner, and  forcing Boehner to re-enter the fray and assume the position of whipping boy.  Cantor wants Boehner’s job; and if the debt ceiling compromise includes tax increases, he’ll get it.
But we digress.
Boehner is right…it does take two to tango.  But Republicans won’t stay on the dance floor.  They walked out of the Gang of Six deficit meetings; they walked out of the Biden Deficit Talks; and then after agreeing to join with the President to craft a “Grand Bargain” they backed off that in favor of a much smaller deal.  They talk about reaching a deal but they won’t stay at the table long enough to get it done.
They call the President’s desire to repeal the Bush Tax cuts as “job killing.”  But the Bush tax cuts have been in place for a decade.  Where are the jobs?  The answer is…overseas.  That’s where the Republican benefactors have spent their tax savings.  They have built factories and created jobs in foreign lands while the American people struggle to make ends meet.
And the Speaker is being disingenuous when he talks about creating jobs.  The Republican controlled House has not offered one job creating bill since taking control of the chamber.  They have proffered legislation on gay marriage, English as our national language and numerous anti-abortion bills…but not one bill to create jobs.
The President successfully positioned himself as the adult in the room.  He is the pragmatist willing to put his party’s most sacred programs on the table for the good of the country.  Now we’ll see if the Republicans can put aside their internal squabbles, cease with the temper tantrums and meet the President half way.           

Saturday, July 9, 2011

"Put It Out With The Trash"

Some of you may be familiar with an old political term: “put it out with the trash.”  It refers to a ploy government officials use to release information which will be viewed unfavorably by the press and the public.  Knowing that weekends are a time when the press and the public are generally focused on personal matters rather than matters of state; government officials will often withhold damaging information until late Friday so that it will hit the news wires on the weekend.  The hope is that the negative information will slip by without much notice.  This is referred to as “putting it out with the

Yesterday the House of Representatives set a huge bag of garbage out on the curb…and it really stinks.  The AP reports that on Friday the Republican controlled House overwhelmingly backed a $649 billion defense spending bill that INCREASES the Defense Department budget by $17 BILLION dollars.  Included in the bill is $119 billion to cover the Iraq and Afghanistan wars, a 1.6% pay increase for our troops and funds to purchase a C-17 cargo plane that the Pentagon DID NOT REQUEST.  (However, Boeing is quite pleased.) AP states that while House Republican leaders agreed to slash billions from other agencies such as food aid for low- income women, health research, energy efficiency to name a few; the military budget is the only one to get a double digit increase beginning October 1.

I guess these guys didn’t get the memo.

We are in the midst of the weakest “recovery” in decades.  The unemployment rate has increased over the last three months and currently stands at 9.2%.  Our struggling economy just added a horrifically low 18,000 new jobs in June; which isn’t close to the 100,000 economists expected and just a smidge less than the 300,000 per month needed to reduce unemployment by any significant measure.  Our GDP is in the tank and we are spending 25 cents for every 15 cents we receive in taxes.  We generate a deficit of $1.6 trillion dollars per year and we owe $14.6 trillion to the Chinese, the Japanese, the Saudis and several European countries.  And if we don’t find a way to increase our debt limit by August 2nd it all goes to hell in a hand basket and we become Greece without the olives.

So what do these clowns do…they increase the defense budget by $17 BILLION dollars forcing us to continue to borrow from Japan, Saudi Arabia and Europe…so that we can build weapons that the Pentagon does not want…which we will use to provide military defense for Japan, Saudi Arabia and Europe.  And, because they need to be fiscally responsible, the House will offset the expense in part by cutting services to the poor, the elderly and the infirmed.

No wonder they set this out with Friday’s trash.