Archive for June, 2013

Budget Fantasy

Thursday, June 20th, 2013

It wasn’t all that long ago that Republicans in the House and Senate were claiming that the Obama administration was irresponsible because they hadn’t proposed a budget.

“President Obama missed a great opportunity today to help our economy.  This was supposed to be the day he submitted his budget to the Congress.  But it’s not coming.  It’s going to be late.  Some reports say it could be a month late,” Speaker John Boehner (R-Ohio) said on the House floor.

Then both the White House AND the Senate Democrats put budgets on the table.

What has happened since is a fascinating political turn from Republicans.

The first was the claim that no progress would occur on budget talks until President Obama was willing to support cuts to retirement programs.  Then Obama DID publically outline his willingness to make adjustments to retirement programs in return for more revenue through tax reform and subsidy cuts.  The Republican response was to deny that Obama ever said anything.  Boehner said, “there’s no plan from Senate Democrats or the White House to replace the sequester.”

When confronted by reporters that Obama had not only produced a budget, but that it also included concessions on retirement plans, Boehner responded, “If he had a plan, why wouldn’t Senate Democrats go ahead and pass it?”

The facts again, however, are at odds with that position.

The reason the Senate Democrats have been unable to pass a budget to replace the sequester cuts is that the Senate Republicans have blocked a vote with a filibuster.  The Senate Republicans are filibustering the bill because they know if they allowed a simple up or down vote, the budget would pass.

This is consistent with the Republican message that the sequester is not only Obama’s fault, but his preference.  At the same time as they are criticizing Obama for failing to compromise (which in Republican speak means accept our position), they are taking credit for the whole effort.  “I don’t think taking 2 percent off the top in a $14 trillion economy is going to be a big drag on growth,” said House Budget Committee Chairman Rep. Paul Ryan, R-Wis.  For an economy that is struggling to grow faster than 2%, that is a curious statement – but then math has historically been a challenge for him.

Both Obama, the Democrats, and Republicans proposed alternatives to the sequester.  Yet the sequester cuts still took effect.  Here’s how Boenher explained it.

Well, no, he didn’t want the cuts, but we have the sequester as a result of his demands. And I, told my colleagues in the House that the sequester will stay in effect until there’s an agreement that will include cuts and reforms that will put us on a path to balance the budget over the next ten years.

This path to a balanced budget is a reference to the Republican Paul Ryan budget which was rejected by voters less than a year ago. That’s the budget that also includes repealing Obamacare which the CBO says will ADD to the debt. But the Ryan budget keeps the “job killing” taxes contained in the Obamacare bill in order to balance the budget in ten years.

What about the deal that Obama put on the table to “trade” reductions in retirement programs for tax reform?

Boehner said, “Listen. I have worked with the president for two years to try to come to an agreement. Unfortunately, we’ve not been able to do so.”

Right! Obama has a deficit plan, but Boehner couldn’t come to an agreement on it because Eric Cantor told him the House Republicans wouldn’t approve it. Cantor has said this himself. That’s not a supporting point for Boehner’s contention that Obama has no deficit proposal that includes spending cuts. It’s, if anything, a refutation.

When pushed on this point, Boehner has said, “The president got $650 billion of higher taxes on the American people on January the first. How much more does he want? When is the president going to address the spending side of this?”

And so the circular part of this illogical argument starts over again.

Republicans claim that Obama doesn’t have a plan to replace the sequester (which he does) because the Senate can’t pass it.  The Senate has the votes to pass it but Republicans are preventing the Senate from taking a vote.  The House Republicans discount Obama’s offer to cut spending AND raise taxes because they oppose tax increases even though their own budget includes tax increases.

So why don’t we have a deal?

Boehner can’t make a deal because if it did, it wouldn’t pass the House and would likely also cost him his job.  Instead of pointing the finger at the Tea Party section of the house, he has simply created this Big Lie regarding the President and his intentions.

He figures if he and other Republicans continue to repeat this Big Lie, perhaps it will stick.

“The president has to go first with plans for Medicare and Social Security,” Maine Senator Collins said. “Then I think you will see more receptivity on the Republican side to an overhaul of the tax code” that raises more revenue.


“It’s still not clear he’s willing to actually cut spending,” said another House aide.  “And that’s what is necessary.”

“I’m not so sure he has given up on raising taxes entirely,” says yet another aide.  “He will try to raise net tax revenue through tax reform.”  GOP Congressional aids quoted by Byron York.

Yet this is EXACTLY what Obama has been offering for months.  He has gone first, as Senator Collins recommended, and nothing has happened.  He has offered to trade tax increases through tax reform for cuts in Medicare and Society Security.  Republicans are rejecting this offer because, apparently, THEY are the only ones who can be trusted to raise taxes.

So why aren’t we getting a deal done?

Ezra Klein from the Washington Post documented this maddening circular logic with GOP Strategists Mike Murphy.

Murphy began by opining that Republicans might cut a deal with Obama if only Obama would endorse means-testing Medicare. Reporter John Harwood tweeted to him that Obama has supported this. Murphy replied that it’s a “good start but not enough” — Obama should also support “chained CPI,” or using a stingier formula to calculate cost of living increases for Social Security. Many people pointed this out to him. Murphy then called chained CPI a “small-beans gimmick.”

Instead we have sequester cuts which are causing real hardships to real people.  The cuts are slowing economic growth and putting people out of work.  That is making even the International Monetary Fund uncomfortable.  They have already expressed their concern that the US cutting spending TOO quickly.  It wasn’t all that long ago that Republicans were using the IMF as the boogeyman.  If the US didn’t cut spending, they predicted, the IMF would impose harsh penalties similar to what they did to Greece.  Now the IMF is warning us, just like it warned Greece, but the warning is that the Republican plan to dramatically shrink government is too aggressive.

“The nature of the recovery appears to be changing,” the IMF staff wrote in its mid-year review of the world’s largest economy. “The automatic spending cuts not only exert a heavy toll on growth in the short term but the indiscriminate reductions in education, science and infrastructure spending could also reduce medium-term potential growth.”

What do they recommend?

The same deal the President has offered.   Increase taxes to fund investments in education, science and infrastructure and reduce longer term spending through retirement program reform.

So why don’t we have a deal?

Because the Republicans are unwilling to make ANY deal with Obama.  This has nothing to do with entitlement reform.  This has nothing to do with taxes.  This has nothing to do with economics.

Republicans would rather prevent REAL economic recovery, blame the continuing hardship on Obama, continue to tell the Big Lie that he’s the one who is unwilling to compromise, and take their chances with voters in 2014.  That’s been the Republican strategy ever since Obama and his new progressive majority took over the White House.  It was a strategy that worked in 2010.

Fortunately the Democrats already have plans to hold Republicans accountable for this strategy in 2014.

Sen. Brian Schatz (D-Hawaii) said in speaking with constituents that the budget has become a common topic and people are receptive to the approach Democrats have outlined.

“People want a budget,” Schatz said. “There is anxiety because we’ve been on a [continuing resolution] for so long and sequester is hurting our local economy.”

Hopefully there will be some accountability at the ballot box.  That is the best way to punish those who choose the interests of their party over the interests of the country.

Issa’s IRS Agenda

Tuesday, June 4th, 2013

Rep Darrell Issa from California thinks that the Cincinnati IRS office method of investigating applications for non-profit status, “was coordinated in all likelihood right out of Washington headquarters – and we’re getting to proving it.”

This might be shocking to those who have not been following Rep Issa’s Congressional career, but a closer look reveals a different agenda.  When Congressman Issa took over control of the house, he claimed that the Obama was “one of the most corrupt presidents in modern times”.   He also predicted that his investigations into this corruption would save the taxpayers $200B.

His committee has generated over 700 requests for information, issued dozens of subpoenas, and held hundreds of hearings.   But for all of that activity, there have been few follow-ups and more importantly, even fewer reports, and no prosecutions or convictions.

Let’s see if Rep. Issa has delivered on his two big agenda items; uncovering corruption and saving the taxpayers money.

To support his promise to save $200B, he used this Medicare example.  “We can save $125 billion in simply not giving out money to Medicare recipients that don’t exist for procedures that didn’t happen.”

When asked where his $125B number came from, Issa’s press office pointed to the Office of Management and Budget.  That office, however, said the $125B figure covered all government payments, not just Medicare.  The OMB report cited by Issa’s office also detailed how the Obama administration’s focus on Medicare fraud had reduced improper payments from 12.4% to 10.5% saving $4B.

Politifact labeled Issa’s claim of $125 in Medicare fraud FALSE.

Issa tried to make a big issue out of Solydra’s failure.  “There’s been this attitude that government can weigh in with loan guarantees and money and pick winners, specific company winners, and losers.”  “We see that as a backdoor easy way to end up with corruption in government.”  Issa got more than 170K pages of documents on Solyndra, requested another 1M pages, and after a year, came up empty.  “Is there a criminal activity? Perhaps not,” Oversight and Government Reform Committee Chairman Darrell Issa told POLITICO. “Is there a political influence and connections? Perhaps not. Did they bend the rules for an agenda, an agenda not covered within the statute? Absolutely.”  Shortly after making that comment, it turned out that Issa had himself sent a letter to the Department of Energy requesting that they “bend the rules” on a loan to Solyndra.  Issa was also the featured speaker at a Romney fund-raiser hosted by Solyndra’s main lobbyist.

Finally, Issa was particularly incensed that Pennsylvania Rep. Joe Sestak was offered an administration job in exchange for dropping out of the primary race against Arlen Spector.

He called the Sestak matter “Obama’s Watergate” and called repeatedly for an investigation, suggesting at one point that there could have been “up to three felonies” involved. He also called for a special prosecutor to conduct a “formal investigation into whether a crime was committed” in the Sestak offer.

Where did that one go?

The same place all of the others ones have gone – nowhere.  After learning that this practice was common in the Bush White House, he dropped the whole thing.  “Once we knew, as we discovered, that it turns out that Republicans and previous administrations thought it was OK in spite of the absolute black and white letter of the law, it got bigger — it got bigger than President Barack Obama.”

So that brings us back to the IRS investigation and Issa’s claim that it can be traced back to Washington.

He claims that he has testimony from IRS employees to support his claim, but refuses to release the full transcripts of the testimonies.  He claims that his committee has subpoenaed the administration for more documents, but his office later said no additional subpoenas have been issued.

And that Washington connection?  It turns out that the tax attorneys who serve as a resource for those processing applications for tax exempt status work in Washington.  Those were the people that were providing the IRS Cincinnati office direction on how to deal with applications from groups who appeared to be participating in prohibited political activity.

The funny thing is that for someone obsessed with the “scandals” of the current administration, Rep. Issa was himself a key participant in a REAL political scandal.

It was Bush’s political purge of 8 US Attorneys.  Turns out that Rep. Issa was one of the politicians requesting the dismissal of the attorney in his district because of her successful  prosecution of Republican San Diego Congressman Randy “Duke” Cunningham.  He wrote a letter complaining that his local attorney should have been focusing her attention on immigration violations rather than the $2.4M bribery that eventually sent “Duke” Cunningham to jail.  That attorney was later dismissed even though her HR record praised her for her work on the Cunningham case and had no entries suggesting she was somehow neglecting her immigration enforcement responsibilities.

So where does this leave us?

As far as the IRS is concerned, the spin is already moving away from Watergate and toward lack of oversight.  So rather than being guilty of concocting the plot, the White House is now guilty of knowing about it and not doing anything.

“My gut tells me that too many people knew this wrongdoing was going on before the election, and at least by some sort of convenient, benign neglect, allowed it to go on through the election,” Issa said. “I’m not making any allegations as to motive, that they set out to do it, but certainly people knew it was happening.”

The next inevitable step has already been floated by Karl Rove in a weekend dustup on ABC with David Plouffe.  After debating the topic, Rove said, “I didn’t suggest it was being driven by the White House.”, but finished up by blaming the president anyway and said those at the top in the Obama administration should have done a better job in policing the IRS.

Thus this story follows the same arc of many others in the Issa resume.  Big claims of scandal, followed by innuendo based on partial reporting of the data, followed by reframing of the original claims as the facts contradicting the original claims become better known, followed by silence – no report, no indictment, no trial.  The trial of course would be redundant, since the only trial that matters is the trial that was already held in the court of public opinion.

Issa has even backed off on his claim regarding Obama’s corruption.

“I’m certainly saying this administration is going to have to straighten up and fly right. It’ll be our job to make sure government money isn’t wasted.”

“I’ve never made that a personal statement, tried never to make that a personal statement about the president, so if that’s backing up from it, I’m not saying the president is personally corrupt. But his administration has to change direction, particularly as to taxpayers’ money.”

So what is Issa’s agenda?  Why does he continue to play this “rope-a-dope” game of making reckless claims and then backing off from them?

Perhaps his own words will give us more insight,

“Oversight is not and should not be used as a political weapon against the occupant of the Oval Office. It should not be an instrument of fear or the exclusive domain of the party that controls Congress.” USA Today 11/11/2010

“You know, there will be a certain degree of gridlock.”  On the Rush Limbaugh Show 11/19/2010

Issa’s agenda is simple.  Just like the rest of the Congressional Republicans, he is going to do everything that he can to drag down the public image of this President and tie his administration up in knots responding to whatever “scandal” his committee can concoct.

This cynical tactic was created by McConnell and Boenher in hopes that they could somehow regain power by grinding government to a halt and then blaming Obama for the consequences.

The best hope to resolve the gridlock Republicans have created?  Vote them out in 2014.

Next up, what happened to all that talk about the budget?