Maybe we'll hold an election next year and no one will show up to vote. Just kidding, of course, since I haven't missed a presidential vote yet. But what is troubling is how candidates and possible candidates are losing public support either from self-inflicted wounds or from events over which they have no control.
Starting with declared candidate and incumbent President Obama, rising prices at the gasoline pump, the upheaval in the Arab world, and the war in Afghanistan are taking their toll on the President. In the case of gas prices, the public has some expectation that there is something the President can do to halt the increases. In fact, there is little he can do except assume an anti-Wall Street posture through an investigation of what hedge fund managers and market manipulators may be doing to artificially jack up the prices.
The increase in gas prices does take a toll on the already sluggish economic recovery by diverting more of a household's discretionary spending to buying gasoline and away from eating out and buying a variety of consumer goods. Meanwhile, many of these same households continue to experience a continued decline in value of one of their major assets -- housing. The other major asset, 401(k) retirement investments, has recovered its value as the stock market continues its extended rise. But the bottom line is that the combination of rising gas prices and accompanying inflation in food and clothing prices, plus the continued decline of housing assets with little likelihood of change for years, has added to the gloom of the public. And when that happens the person who gets the blame is the President, Democrat or Republican.
Going abroad, the headlines and evening news are dominated by the political meltdown in the Arab world with the overthrow or demands for overthrow of presidents or kings in a number of Arab countries. These politically destabilizing events leave the impression of an indecisive U.S. foreign policy. In fact events in the Arab world have gone beyond the U.S. ability to influence them; as said in the previous posting, we are very concerned "spectators". Add to this the declining public support for the decade-old war in Afghanistan, a war that continues to kill or wound our troops and drain our financial resources. All of this would seem to be a golden opportunity for the Republicans to capture the White House next year. Unfortunately for the GOP, they have a bundle of problems of their own.
First is the fact that there seems to be little enthusiasm among Republican voters for any of the choices. Thus, in polls of GOP voters we find there are shifting ties on who is the most preferred and the ties are in the 20 percent range, meaning no one enjoys a lot of support. But beyond the weak pool of wannabe's there are several self-inflicted wounds that are now working against the GOP.
One flows from the recent 2012 budget proposal passed by the GOP-controlled House, the so-called Paul Ryan budget. While the Ryan plan purports to be a road map for cutting the deficit over the next decade, the current public focus is increasingly on that part of the plan to kill medicare as it has operated for the last 45 years. Under the Ryan plan it would be replaced with a voucher system that results in a giant subsidy for the insurance industry and the increasingly clear fact that the vouchers will become increasingly inadequate to purchase an adequate insurance policy. This point is being pressed by senior and near-senior citizens so that the GOP plan for medicare is becoming the lightening rod for the entire GOP budget plan.
On top of this the point is also being driven home that the Ryan plan to short change the future elderly on health care is flanked by the GOP budget proposal to give more tax breaks to the wealthy. This is not the same as saying that the public is enamored with the Obama plan which preserves the current structure of medicare. But the points being driven home against the Ryan plan by seniors, a key demographic of support for the Republicans, is having a wider effect on the general public.
On the foreign policy front, the most outspoken Republicans are pressing for policies that seem to run counter to where the public wants to go. On the troubles in the Arab world, outspoken Republicans like Senators McCain and Graham want more U.S. military involvement in Libya and a more robust but non-military U.S. policy for Syria. The public, however, seems generally agreeable on supporting humanitarian goals in Libya but, except for right wing foreign policy hawks, there seems to be little support for still another military adventure in the Arab world or anywhere else. Similarly, the GOP was and remains supportive of Obama's troop escalation in Afghanistan and for continued military intervention in that country, a position that is increasingly unpopular with the general public and causes concern among budget hawks about what the war's cost is doing to our fiscal problems. And this assessment of GOP prospects doesn't even include the "birther" issue which could backfire on the GOP, even though it is espoused primarily by the far right wing of the party. Even conservative Arizona Governor Brewer says the birther issue is the "path to destruction" for the country.
So whoever emerges as the candidate for either party is likely to find, to modify an old analogy with a western river, his or her support is neither wide nor deep.
Wednesday, April 27, 2011
Sunday, April 24, 2011
SYRIA AND BITS AND PIECES ABROAD; TRUMP
The anti-government violence continues to grow in Syria but unlike other rebellions in the Arab world, the focus of demonstrators appears to be focused on rules-of-the-game political change rather than regime change. President Bashar al-Assad has changed his government, an easy bit of window dressing change, and has ended the long-standing and hated emergency law under which Assad and his late presidential father ruled with an iron fist. But given the severity of the crackdown on demonstrators, these changes have altered little or nothing for the protesters.
The Syrian unrest creates another major dilemma for the U.S. in the Middle East. On the one hand the overthrow of Assad would create a big gap in the Shia-based band that has formed, extending from Iran through Iraq and Syria to the Hezbollah in Lebanon. Syria is about 70 percent Sunni but the Assads and the key military leaders have the Alawite sect, a branch of Shia, as their religious base. The Alawites make up about 10 percent of the Syrian population. Breakup of the Shia band by the overthrow of Assad would be a major blow to Iran which has strong ties with Syria and uses Syria for funneling arms to Hezbollah and Hamas.
On the other hand, a U.S. policy goal under President Obama has been one of "engagement" with Assad. That is, seeking through political talks with Syria to achieve greater political stability in the region by weaning Syria away from Iran, ending Damascus support of terrorism, halting interference in Lebanon and Iraq, and making an accomodation between Syria and Israel. The dilemma is in the question: "After Assad, what?"
The Assads, both father and son, had and have the Baath Party, a secular party, as their political base. If Assad is overthrown, it is not at all clear who will emerge as the next political power and whether the secularism of the Baathists would be replaced by a radical Islamic power structure. And that uncertainty about what might come next is what concerns the U.S., as it does Israel also. In a sense, with Assad it's "the devil we know". With all of the uncertainties for U.S. policy flowing from the recent upheavals in the Arab world, adding Syria to the list is hardly what the U.S. needs right now but like unrest in other parts of the Arab world, the U.S. is primarily a spectator rather than a shaper of events. Whatever the dilemma may be, we cannot escalate our rhetoric about Syria in any way that may get us involved in still another intervention or participation in a regime change strategy.
0-0-0-0-0
Speaking of the Middle East and U.S. policy, it is hardly helpful that the Republican party has invited Israeli Prime Minister Netanyahu to address Congress next month. It has always been something of a source of strain between Republicans and Democrats, both in the White House and Congress, to show which party is more pro-Israel and thus reap the rewards of Jewish votes and campaign contributions. Former President George W. Bush was perceived as a strong pro-Israel supporter. President Obama in seeking a more balanced Arab/Israel policy in the Middle East is perceived as less friendly toward Israel.
What the Republican invitation to Netanyahu does is to blatantly politicize Israeli relations and thus further complicate through partisanship an already difficult and complex Middle East problem. It makes even more laughable the old adage that politics stops at the water's edge.
0-0-0-0-0
Speaking of politics and foreign policy, last week was the 50th anniversary of the Bay of Pigs fiasco where, through the CIA, we supported a failed effort to overthrow Fidel Castro. What is notable about the anniversary to this blogger is that it took only about 25 years to come to terms with communist China after it overthrew Chiang Kai-shek in l948 and just two years later sent a million soldiers to fight the U.S. in the Korean War. It took about 30 years to normalize relations with Vietnam after fighting a bitter, losing war there. Yet domestic politics, meaning the perceived political clout of Cuban-American voters concentrated in south Florida, still prevents us after 50 years and counting from putting aside our differences with Cuba.
0-0-0-0-0
One cannot write a posting without some mention of Donald Trump, a possible presidential aspirant, who made his big pitch to pander to the far right by joining the so-called birthers who question whether President Obama was actually born in the U.S. In the process, he has come to be viewed as a political clown by many including the establishment GOP, while at the same time rising to the top of some polls on Republican preferences for a presidential candidate. And perhaps more significant, Trump was the featured character last week in the Doonesbury cartoon, adding to his "he's a joke" status. Somewhat lost in the birther mirth have been equally absurd simplistic efforts to appeal to a broader base on hot topics such as the price of gasoline and what to do about our trade problem with China.
On gas prices, Trump says simply tell the oil producing nations of OPEC to cut their prices. The problem, according to Trump, is simply the need for a new messenger. Translated: make me President and I'll show you how to deal with OPEC.
On trade with China, it's also simple. Slap a 25 percent tariff on all Chinese imports as a way of stopping the flood of cheap Chinese goods coming into the U.S. Easy solution if you ignore, among other things, what that would mean in terms of a trade war with China, the shutting off of U.S. investments in China, what the tariff would do to the price of so many Chinese-made goods purchased in the U.S. by low and middle income consumers, and how it would sour our always sensitive political relations with China.
Presumably Trump (or Trumpet since he blows his own horn so much and so loudly) will next resolve the woes we have in the Arab world.
The Syrian unrest creates another major dilemma for the U.S. in the Middle East. On the one hand the overthrow of Assad would create a big gap in the Shia-based band that has formed, extending from Iran through Iraq and Syria to the Hezbollah in Lebanon. Syria is about 70 percent Sunni but the Assads and the key military leaders have the Alawite sect, a branch of Shia, as their religious base. The Alawites make up about 10 percent of the Syrian population. Breakup of the Shia band by the overthrow of Assad would be a major blow to Iran which has strong ties with Syria and uses Syria for funneling arms to Hezbollah and Hamas.
On the other hand, a U.S. policy goal under President Obama has been one of "engagement" with Assad. That is, seeking through political talks with Syria to achieve greater political stability in the region by weaning Syria away from Iran, ending Damascus support of terrorism, halting interference in Lebanon and Iraq, and making an accomodation between Syria and Israel. The dilemma is in the question: "After Assad, what?"
The Assads, both father and son, had and have the Baath Party, a secular party, as their political base. If Assad is overthrown, it is not at all clear who will emerge as the next political power and whether the secularism of the Baathists would be replaced by a radical Islamic power structure. And that uncertainty about what might come next is what concerns the U.S., as it does Israel also. In a sense, with Assad it's "the devil we know". With all of the uncertainties for U.S. policy flowing from the recent upheavals in the Arab world, adding Syria to the list is hardly what the U.S. needs right now but like unrest in other parts of the Arab world, the U.S. is primarily a spectator rather than a shaper of events. Whatever the dilemma may be, we cannot escalate our rhetoric about Syria in any way that may get us involved in still another intervention or participation in a regime change strategy.
0-0-0-0-0
Speaking of the Middle East and U.S. policy, it is hardly helpful that the Republican party has invited Israeli Prime Minister Netanyahu to address Congress next month. It has always been something of a source of strain between Republicans and Democrats, both in the White House and Congress, to show which party is more pro-Israel and thus reap the rewards of Jewish votes and campaign contributions. Former President George W. Bush was perceived as a strong pro-Israel supporter. President Obama in seeking a more balanced Arab/Israel policy in the Middle East is perceived as less friendly toward Israel.
What the Republican invitation to Netanyahu does is to blatantly politicize Israeli relations and thus further complicate through partisanship an already difficult and complex Middle East problem. It makes even more laughable the old adage that politics stops at the water's edge.
0-0-0-0-0
Speaking of politics and foreign policy, last week was the 50th anniversary of the Bay of Pigs fiasco where, through the CIA, we supported a failed effort to overthrow Fidel Castro. What is notable about the anniversary to this blogger is that it took only about 25 years to come to terms with communist China after it overthrew Chiang Kai-shek in l948 and just two years later sent a million soldiers to fight the U.S. in the Korean War. It took about 30 years to normalize relations with Vietnam after fighting a bitter, losing war there. Yet domestic politics, meaning the perceived political clout of Cuban-American voters concentrated in south Florida, still prevents us after 50 years and counting from putting aside our differences with Cuba.
0-0-0-0-0
One cannot write a posting without some mention of Donald Trump, a possible presidential aspirant, who made his big pitch to pander to the far right by joining the so-called birthers who question whether President Obama was actually born in the U.S. In the process, he has come to be viewed as a political clown by many including the establishment GOP, while at the same time rising to the top of some polls on Republican preferences for a presidential candidate. And perhaps more significant, Trump was the featured character last week in the Doonesbury cartoon, adding to his "he's a joke" status. Somewhat lost in the birther mirth have been equally absurd simplistic efforts to appeal to a broader base on hot topics such as the price of gasoline and what to do about our trade problem with China.
On gas prices, Trump says simply tell the oil producing nations of OPEC to cut their prices. The problem, according to Trump, is simply the need for a new messenger. Translated: make me President and I'll show you how to deal with OPEC.
On trade with China, it's also simple. Slap a 25 percent tariff on all Chinese imports as a way of stopping the flood of cheap Chinese goods coming into the U.S. Easy solution if you ignore, among other things, what that would mean in terms of a trade war with China, the shutting off of U.S. investments in China, what the tariff would do to the price of so many Chinese-made goods purchased in the U.S. by low and middle income consumers, and how it would sour our always sensitive political relations with China.
Presumably Trump (or Trumpet since he blows his own horn so much and so loudly) will next resolve the woes we have in the Arab world.
Wednesday, April 20, 2011
REVOLUTION OF RISING EXPECTATIONS: U.S.; ARAB WORLD; CHINA
In the period from the l950s into the 70s, the phrase "revolution of rising expectations" (RRE) was popularized to explain the outlook of people in colonial and post-colonial countries as the people looked to a brighter future. RRE was also applied more generally to underdeveloped nations of Asia, Africa, Latin America, and the Middle East. While part of RRE was attributed to expectations for a better future after shedding the colonial rulers, those expectations were also significantly fueled by a growing awareness of what was looked at as "the good life" in the developed world -- a world of cars, good housing, educational opportunities, abundant food, and proper health care. The problem was that the reality in the underdeveloped world did not rise to the expectations, thus fostering political unrest and rebellion. RRE may help explain an episode of unrest in this country, current unrest in the Arab world, and the possibility of future unrest in China.
In a sense the U.S. had its own RRE and rebellious fallout in the l960s with the urban riots of African-Americans in northern cities. The civil rights movement in the l950s and early 60s led to national legislation that banned various forms of legal and social discrimination in the south. However, the new legal and political empowerment of African-Americans in the south did nothing for their counterparts in the north where many forms of economic and social discrimination existed. These involved the day-to-day world of lack of employment opportunities, poor housing, and other forms of racially based deprivation. A "we're not going to take any more" outlook led to violent riots, triggered by events such as a court verdict, in northern cities beginning in l964, reaching their zenith with the assassination of Martin Luther King in the spring of l968.
RRE may have some value in understanding what is currently going on in the Arab world. Within the context of post-colonialism it would seem that ending exploitive and repressive colonial rule would create expectations of better things to come both politically and economically. But what resulted in many of the Arab countries was decades of autocratic rule which banned or limited political dissent and which separated the population into a small population of politically well connected "haves" and a large mass of "have nots". What evolved was the politically oppressed and economic "have nots" merging into movements to overthrow the autocrats as has occurred in Tunisia and Egypt but has yet to be fully played out in countries like Yemen, Bahrain, Syria, and perhaps Jordan.
Now to China which has come a long way since the very oppressive years of Mao Tse- tung. There has been a remarkable opening up of the Chinese economy to foreign investment and a market economy, although still controlled by the ruling communist regime. The opening up of the economy has not been matched by a loosening of political control which seeks to shut off any dissent whether in the form of street demonstrations or the linking of dissenters through the internet or social networks such as Facebook.
The big concern among Chinese leaders these days is that the opening up of the economy which has led to the economic improvement for tens of millions can also lead to frustration and dissent if the economy falls on hard times. Right now the Chinese economy is in the stage of continual robust growth with the benefits spilling over to the workers and motivating the rural poor to migrate to the cities in search of jobs and a better life. But some trouble signs are appearing. A nagging problem of the robust growth is the accompanying need to slow overheating and prevent hyperinflation. The government has taken steps to slow inflation through such things as higher interest rates and requiring banks to hold more cash reserves to slow lending.
The fear, however, is that further inflation will push prices up to the point where the higher prices eat into the welfare of the workers. Further, the higher prices will extend to China's export market, the engine of its growth, to the point of cuttings its sales abroad which in turn will lead to worker layoffs and have a chilling effect on the millions of rural poor hoping to improve their lives by becoming urban workers.
For the near-term future, China does not appear to be threatened by RRE-based rebellion but the Chinese government is hypersensitive to any real or perceived future dissent. So any political ripple effects flowing from economic difficulties, real or perceived, are likely to be met with very harsh repression. The Tunisian and Egyptian models are clearly not the wave of the future in China.
In a sense the U.S. had its own RRE and rebellious fallout in the l960s with the urban riots of African-Americans in northern cities. The civil rights movement in the l950s and early 60s led to national legislation that banned various forms of legal and social discrimination in the south. However, the new legal and political empowerment of African-Americans in the south did nothing for their counterparts in the north where many forms of economic and social discrimination existed. These involved the day-to-day world of lack of employment opportunities, poor housing, and other forms of racially based deprivation. A "we're not going to take any more" outlook led to violent riots, triggered by events such as a court verdict, in northern cities beginning in l964, reaching their zenith with the assassination of Martin Luther King in the spring of l968.
RRE may have some value in understanding what is currently going on in the Arab world. Within the context of post-colonialism it would seem that ending exploitive and repressive colonial rule would create expectations of better things to come both politically and economically. But what resulted in many of the Arab countries was decades of autocratic rule which banned or limited political dissent and which separated the population into a small population of politically well connected "haves" and a large mass of "have nots". What evolved was the politically oppressed and economic "have nots" merging into movements to overthrow the autocrats as has occurred in Tunisia and Egypt but has yet to be fully played out in countries like Yemen, Bahrain, Syria, and perhaps Jordan.
Now to China which has come a long way since the very oppressive years of Mao Tse- tung. There has been a remarkable opening up of the Chinese economy to foreign investment and a market economy, although still controlled by the ruling communist regime. The opening up of the economy has not been matched by a loosening of political control which seeks to shut off any dissent whether in the form of street demonstrations or the linking of dissenters through the internet or social networks such as Facebook.
The big concern among Chinese leaders these days is that the opening up of the economy which has led to the economic improvement for tens of millions can also lead to frustration and dissent if the economy falls on hard times. Right now the Chinese economy is in the stage of continual robust growth with the benefits spilling over to the workers and motivating the rural poor to migrate to the cities in search of jobs and a better life. But some trouble signs are appearing. A nagging problem of the robust growth is the accompanying need to slow overheating and prevent hyperinflation. The government has taken steps to slow inflation through such things as higher interest rates and requiring banks to hold more cash reserves to slow lending.
The fear, however, is that further inflation will push prices up to the point where the higher prices eat into the welfare of the workers. Further, the higher prices will extend to China's export market, the engine of its growth, to the point of cuttings its sales abroad which in turn will lead to worker layoffs and have a chilling effect on the millions of rural poor hoping to improve their lives by becoming urban workers.
For the near-term future, China does not appear to be threatened by RRE-based rebellion but the Chinese government is hypersensitive to any real or perceived future dissent. So any political ripple effects flowing from economic difficulties, real or perceived, are likely to be met with very harsh repression. The Tunisian and Egyptian models are clearly not the wave of the future in China.
Sunday, April 17, 2011
TURKEY AND AFGHANISTAN; BUDGETARY SIMPLICITY VS ACTS OF FAITH
On my oft repeated bias toward a greater role for Muslim Turkey in helping to achieve political stability in the region, Turkey has now said it was willing to host an office in Istanbul for the Taliban to promote peace talks in Afghanistan. Turkey has contributed non-combat troops to the NATO military involvement in Afghanistan.
It is difficult to know where all of this is going, if anywhere, but it is one more possible avenue for getting a political settlement with the Taliban to end the 10-year old war there. Supposedly there are back stage talks already between the Taliban and the government of Afghan President Karzai, with some U.S. involvement. But it is unknown if these are continuing talks and whether any progress has been made. The Turkish offer could add to the negotiation architecture of any peace talks, but there is still a missing major player, at least publicly, in any negotiations that may be going on. That missing player is Pakistan which hosts major elements of the Taliban within Pakistan and which has a history of support of the Taliban.
Turkey's willingness to host a Taliban office might also help determine the power structure of the Taliban itself. It is not a single, hierarchical organization. There are competing factions within Pakistan and the Taliban insurgents within Afghanistan may be operating independently. If the Taliban are to be part of any meaningful political settlement, a necessary first step must be having some confidence that a Taliban office in Turkey has some clout with Taliban factions in both Pakistan and Afghanistan.
There is another advantage of Turkey's offer. Since the governments of Muslim Afghanistan and Pakistan do not trust each other, it puts another Muslim nation in the role of middle man, a nation that already has a growing role in quietly helping in efforts to bring political stability to the region.
-0-0-0-0
As President Obama and the Republicans attack each other on their competing plans for fiscal 2012, the GOP would seem to have at least one advantage. Despite its meat ax approach to cutting spending and dealing with health care entitlements and its clear bias toward further enriching the wealthy, it does have the advantage of deceptive simplicity. A look at the alternative approaches to deal with the fiscally draining effects of medicare illustrates that simplicity.
The GOP approach to restricting medicare is to convert the current federally funded fee for service approach to a voucher system that would provide federal subsidies to purchase health insurance from the insurance industry. The current medicare funding system is open ended, just submit the bills and the federal government will pay them. The GOP proposes having fixed costs for the program. Aside from the issues of sending huge sums of taxpayer money to the insurance industry and continuing the insurance industry's gate keeper role over accessing needed health care, the general conclusion about the voucher approach is that over time the subsidies to the insurance purchaser will fall behind the increasing costs of the insurance policy. In that regard it certainly is a political risk for the GOP among the growing population of the elderly and its concern for uncertainty about health care and what it will cost them. But it is a seemingly simple solution to cutting the cost and controlling the growing fiscal burden of medicare. And simply cutting costs is central to the agenda of the right wing fiscal hawks.
The Obama approach to cutting the costs of the program is more of an act of faith. The President's plan for cutting costs relies in part on decreasing the cost of medicare through greater efficiency and a crackdown on waste and fraud. But his key to containing costs is having an independent panel which would have the power to slow the cost of medicare by limiting medicare spending if it is growing faster than the growth of the gross domestic product (GDP), plus some wiggle room. If medicare spending rises too much beyond the growth of GDP, the panel would have to come up with ways to keep that growth within the limits of GDP growth. If that isn't complicated enough, the panel's recommendations are then submitted to Congress which can choose to vote or not vote on the recommendations, but politically Congress in effect loses control of its current power to write the rules of the game.
It is a complicated process that challenges any simple understanding except to Congress which realizes how it would limit the role of the lawmakers. The act of faith comes in the willingness to believe that such a panel can deal with all of the complexities involved in determining what health care delivery really costs and then take the steps to cut those costs. Despite the complexity, however, it should be noted that Obama's plan does address the big problem of reducing the growing costs of health care; the GOP plan does not.
So if simplicity has any political advantage, the score is 1-0 GOP. But as stated in the previous post, both Obama's and the GOP's budget plans are just opening bids with "any" final result to be worked out through the traditional process of bargaining and compromise, ugly words to the tea party and its right wing fellow travelers.
It is difficult to know where all of this is going, if anywhere, but it is one more possible avenue for getting a political settlement with the Taliban to end the 10-year old war there. Supposedly there are back stage talks already between the Taliban and the government of Afghan President Karzai, with some U.S. involvement. But it is unknown if these are continuing talks and whether any progress has been made. The Turkish offer could add to the negotiation architecture of any peace talks, but there is still a missing major player, at least publicly, in any negotiations that may be going on. That missing player is Pakistan which hosts major elements of the Taliban within Pakistan and which has a history of support of the Taliban.
Turkey's willingness to host a Taliban office might also help determine the power structure of the Taliban itself. It is not a single, hierarchical organization. There are competing factions within Pakistan and the Taliban insurgents within Afghanistan may be operating independently. If the Taliban are to be part of any meaningful political settlement, a necessary first step must be having some confidence that a Taliban office in Turkey has some clout with Taliban factions in both Pakistan and Afghanistan.
There is another advantage of Turkey's offer. Since the governments of Muslim Afghanistan and Pakistan do not trust each other, it puts another Muslim nation in the role of middle man, a nation that already has a growing role in quietly helping in efforts to bring political stability to the region.
-0-0-0-0
As President Obama and the Republicans attack each other on their competing plans for fiscal 2012, the GOP would seem to have at least one advantage. Despite its meat ax approach to cutting spending and dealing with health care entitlements and its clear bias toward further enriching the wealthy, it does have the advantage of deceptive simplicity. A look at the alternative approaches to deal with the fiscally draining effects of medicare illustrates that simplicity.
The GOP approach to restricting medicare is to convert the current federally funded fee for service approach to a voucher system that would provide federal subsidies to purchase health insurance from the insurance industry. The current medicare funding system is open ended, just submit the bills and the federal government will pay them. The GOP proposes having fixed costs for the program. Aside from the issues of sending huge sums of taxpayer money to the insurance industry and continuing the insurance industry's gate keeper role over accessing needed health care, the general conclusion about the voucher approach is that over time the subsidies to the insurance purchaser will fall behind the increasing costs of the insurance policy. In that regard it certainly is a political risk for the GOP among the growing population of the elderly and its concern for uncertainty about health care and what it will cost them. But it is a seemingly simple solution to cutting the cost and controlling the growing fiscal burden of medicare. And simply cutting costs is central to the agenda of the right wing fiscal hawks.
The Obama approach to cutting the costs of the program is more of an act of faith. The President's plan for cutting costs relies in part on decreasing the cost of medicare through greater efficiency and a crackdown on waste and fraud. But his key to containing costs is having an independent panel which would have the power to slow the cost of medicare by limiting medicare spending if it is growing faster than the growth of the gross domestic product (GDP), plus some wiggle room. If medicare spending rises too much beyond the growth of GDP, the panel would have to come up with ways to keep that growth within the limits of GDP growth. If that isn't complicated enough, the panel's recommendations are then submitted to Congress which can choose to vote or not vote on the recommendations, but politically Congress in effect loses control of its current power to write the rules of the game.
It is a complicated process that challenges any simple understanding except to Congress which realizes how it would limit the role of the lawmakers. The act of faith comes in the willingness to believe that such a panel can deal with all of the complexities involved in determining what health care delivery really costs and then take the steps to cut those costs. Despite the complexity, however, it should be noted that Obama's plan does address the big problem of reducing the growing costs of health care; the GOP plan does not.
So if simplicity has any political advantage, the score is 1-0 GOP. But as stated in the previous post, both Obama's and the GOP's budget plans are just opening bids with "any" final result to be worked out through the traditional process of bargaining and compromise, ugly words to the tea party and its right wing fellow travelers.
Wednesday, April 13, 2011
U.S. MILITARY INTERVENTION; OBAMA VS GOP ON BUDGET
To intervene or not to intervene? That is the question.
Apparently NATO has become sensitive to the outcry by Libyan rebels for more air strikes against Gaddafi's forces. The French and British are now pressing other members of NATO to become more involved in the air strikes to protect the rebels. The pressure is directed particularly at Germany who has refused any involvement in the Libyan intervention and the U.S. who led the air campaign at the beginning but passed the baton to NATO to take the lead in the air campaign. Germany is sticking with its non-involvement but despite our supposed commitment to play a secondary role in the Libyan civil war, it has been reported that we are indeed still participating in air strikes against Gaddafi.
And our seemingly firm commitment to NATO about a secondary role stands in strange contradiction to a statement by a U.S. army general to Congress that "some consideration" might be given to the U.S. being part of any international ground force to help the Libyan rebels. However, General Ham, a former NATO commander, said any such U.S. role might make it more difficult for continuing Arab support of the international coalition. Certainly any such U.S. participation would run counter to another supposed commitment that we would have no "boots on the ground" in Libya. Stay tuned for further backtracking on our supposed commitments on intervention policy.
While the U.S. role in Libya apparently has a malleable arms-length character, the same does not apply to Iraq whereby former President George W. Bush's agreement with the Iraqi government calls for all U.S. troops to be out of that country by the end of this year. It has been obvious for some time that we would like to retain a military presence in Iraq beyond the withdrawal deadline to continue the training of Iraqi security forces and to act as a deterent to any Iranian ambitions to directly intervene in Iraqi affairs. In what was supposedly his last visit to Iraq before leaving office, Defense Secretary Gates said the U.S. would be agreeable to maintaining a presence in Iraq, if that country wanted us to stay. As could be expected, the Gates offer was challenged immediately by Muqtada al-Sadr, the virulent anti-American cleric with close ties to Iran and a partner in the coalition government of Prime Minister al-Maliki.
0-0-0-0-0
The budget melodrama. President Obama has now come forth with his own long-term plan for reducing the deficit via changes in the big entitlement programs -- social security, medicare, and medicaid. Since the two health care programs are central to any plan for long term deficit reduction, the absence of such a plan in his February budget plan for fiscal 2012 was clearly noticeable. With the GOP's recent 2012 budget alternative which includes major restructuring of the two health care programs, Obama's plan released today has the appearance of playing catch up with the GOP.
As indicated in a previous posting, the Republican plan should be seen as dead on arrival (DOA) since it reads like vintage Republican efforts to cut out the federal role and turn both money and program substance over to the insurance industry and the states. It is highly unlikely that the GOP approach could make its way through Congress. But there are central features of the Obama plan that also are likely to make it DOA. A key feature of his long-term deficit reduction plan is to pay part of the deficit reductions through increased taxes on upper income earners. The key to this is allowing the Bush tax cuts for the wealthy to expire at the end of 2012, while retaining the cuts for the middle income earners. Obama sought to do the same thing last December but had to give up the effort in exchange for GOP support of continued assistance for the unemployed and a one year reduction in the social security payroll tax, a disguised form of stimulus spending. Obama's plan would also cap itemized deductions for the wealthiest two percent of taxpayers.
On spending, Obama proposed reductions of both domestic discretionary and defense spending.
On the two health care programs which are the chief drivers of the deficit spending and debt problems, Obama did not propose any restructuring of the programs but would limit the growth in spending per individual for medicare. By contrast the GOP has proposed major overhauls of both medicare and medicaid.
We now have the frameworks of both the President and the GOP for reducing deficit spending by $4-6 trillion dollars over the 10-12 years, but the proposals are so fundamentally different that it can only be said, to use poker terminology, that these are just openers. Having declared their openers, they can now proceed to the politically ugly task of seeing what kind of plan can be cobbled that will be acceptable to both parties which will be under heavy pressure from their extreme wings.
It should be noted that neither the GOP nor the Obama plan would do anything about paying off some of the national debt, but only reduce deficit spending. Perhaps it is time for the politically unthinkable -- to consider letting the Bush tax cuts expire for all income groups and do something about both long-term deficit reduction and debt repayment.
Apparently NATO has become sensitive to the outcry by Libyan rebels for more air strikes against Gaddafi's forces. The French and British are now pressing other members of NATO to become more involved in the air strikes to protect the rebels. The pressure is directed particularly at Germany who has refused any involvement in the Libyan intervention and the U.S. who led the air campaign at the beginning but passed the baton to NATO to take the lead in the air campaign. Germany is sticking with its non-involvement but despite our supposed commitment to play a secondary role in the Libyan civil war, it has been reported that we are indeed still participating in air strikes against Gaddafi.
And our seemingly firm commitment to NATO about a secondary role stands in strange contradiction to a statement by a U.S. army general to Congress that "some consideration" might be given to the U.S. being part of any international ground force to help the Libyan rebels. However, General Ham, a former NATO commander, said any such U.S. role might make it more difficult for continuing Arab support of the international coalition. Certainly any such U.S. participation would run counter to another supposed commitment that we would have no "boots on the ground" in Libya. Stay tuned for further backtracking on our supposed commitments on intervention policy.
While the U.S. role in Libya apparently has a malleable arms-length character, the same does not apply to Iraq whereby former President George W. Bush's agreement with the Iraqi government calls for all U.S. troops to be out of that country by the end of this year. It has been obvious for some time that we would like to retain a military presence in Iraq beyond the withdrawal deadline to continue the training of Iraqi security forces and to act as a deterent to any Iranian ambitions to directly intervene in Iraqi affairs. In what was supposedly his last visit to Iraq before leaving office, Defense Secretary Gates said the U.S. would be agreeable to maintaining a presence in Iraq, if that country wanted us to stay. As could be expected, the Gates offer was challenged immediately by Muqtada al-Sadr, the virulent anti-American cleric with close ties to Iran and a partner in the coalition government of Prime Minister al-Maliki.
0-0-0-0-0
The budget melodrama. President Obama has now come forth with his own long-term plan for reducing the deficit via changes in the big entitlement programs -- social security, medicare, and medicaid. Since the two health care programs are central to any plan for long term deficit reduction, the absence of such a plan in his February budget plan for fiscal 2012 was clearly noticeable. With the GOP's recent 2012 budget alternative which includes major restructuring of the two health care programs, Obama's plan released today has the appearance of playing catch up with the GOP.
As indicated in a previous posting, the Republican plan should be seen as dead on arrival (DOA) since it reads like vintage Republican efforts to cut out the federal role and turn both money and program substance over to the insurance industry and the states. It is highly unlikely that the GOP approach could make its way through Congress. But there are central features of the Obama plan that also are likely to make it DOA. A key feature of his long-term deficit reduction plan is to pay part of the deficit reductions through increased taxes on upper income earners. The key to this is allowing the Bush tax cuts for the wealthy to expire at the end of 2012, while retaining the cuts for the middle income earners. Obama sought to do the same thing last December but had to give up the effort in exchange for GOP support of continued assistance for the unemployed and a one year reduction in the social security payroll tax, a disguised form of stimulus spending. Obama's plan would also cap itemized deductions for the wealthiest two percent of taxpayers.
On spending, Obama proposed reductions of both domestic discretionary and defense spending.
On the two health care programs which are the chief drivers of the deficit spending and debt problems, Obama did not propose any restructuring of the programs but would limit the growth in spending per individual for medicare. By contrast the GOP has proposed major overhauls of both medicare and medicaid.
We now have the frameworks of both the President and the GOP for reducing deficit spending by $4-6 trillion dollars over the 10-12 years, but the proposals are so fundamentally different that it can only be said, to use poker terminology, that these are just openers. Having declared their openers, they can now proceed to the politically ugly task of seeing what kind of plan can be cobbled that will be acceptable to both parties which will be under heavy pressure from their extreme wings.
It should be noted that neither the GOP nor the Obama plan would do anything about paying off some of the national debt, but only reduce deficit spending. Perhaps it is time for the politically unthinkable -- to consider letting the Bush tax cuts expire for all income groups and do something about both long-term deficit reduction and debt repayment.
Sunday, April 10, 2011
EGYPT AND POLITICAL INSTABILITY; DANTE AND THE BUDGET
Increasingly we read and hear that the Egyptian military which gained hero status in the ouster of President Mubarak has cooled toward the pro-democracy movement. It is increasingly seen as the protector of its own political dominance and biased toward more conservative political elements such as the Muslim Brotherhood.
But what else seems to be occurring, according to a recent column by David Ignatius, is increasing factionalizing of the country's politics. That is, the largest political block, the Brotherhood, is splitting into several groupings with different views on the role of Islam in national life and constitutional role. Likewise the pro-democracy movement is dividing into several parties in its fight against the Brotherhood. If Ignatius is correct, this factionalizing has a kind of "let a thousand flowers bloom" character to it and thereby strengthen Egypt politically through diversity.
But to this blogger there is a definite downside to such fragmentation of Egypt's politics. It lays the foundation for political instability, hardly what Egypt needs as the next stage in its revolution against autocracy. It would also be an obstacle to Egypt's need for economic recovery and growth.
A multiplicity of parties means government by coalition, which in and of itself sounds acceptable, but unfortunately often leads to instability in dealing with urgent national needs. Such factionalizing and instability was the core of France's governing problem after World War II with the 4th Republic which led to DeGaulle's own revolution to replace it with the 5th Republic led by a greatly increased power of the President. Having just gotten rid of an autocratic President, most Egyptians would hardly be ready for a presidential dominant system so soon. And it is difficult to keep count of the number of governments Italy has had in the post war period because of party splintering. Coalitions also may lead to governing control by the most extreme ends of the political spectrum. In Israel, for example. Prime Minister Netanyahu., himself a conservative, is pushed further to the right because his governing coalition is dependent upon the support from the small, most far right parties.
Given Egypt's need for internal political stability as a pre-condition for economic recovery and growth, it is difficult for me to see the plus side of so much factionalizing as described by Ignatius. Unsettled political conditions won't bring the tourists back and certainly won't attract needed foreign investment. Now to Washington.
-0-0-0-0-0
"Abandon all hope, ye who enter here." Thus spoke Dante in the Divine Comedy: The Inferno regarding those at the threshold of entering hell. And thus it is with we mere mortals who seek to understand what goes on in Washington regarding the budget. Enough has been said about the pending final deal for the remainder of fiscal year 2011 that this posting won't use the space for repeating the terms of the deal, except to say that the tentative agreement on a cut of $38 billion over the next six months is peanuts in terms of the overall problem of spending, deficits, and debt. Rather, this posting is to give just a glimpse into the hellish budgetary process and why the efforts of the average American to follow the action seem doomed.
As the Republican-Democratic bargaining proceeded much attention was given to the "riders" and the GOP's effort, urged on by the tea party and other spending hawks, to attach its social agenda to the budgetary process. This is hardly a new strategy but it became front and center because it was central to the Democratic strategy to blame the GOP for any government shutdown over social policy issues rather than spending itself. Boehner and the GOP countered with"nonsense". The central issue is that Democrats don't want to cut spending for their favorite programs. In fact, both parties are simply playing politically to their liberal-conservative bases. Now to a very arcane issue of the shootout.
There is an old saying that "all money is green". It never was and the current confrontation shows that there are shades of green. Dark green money is spending on the major entitlements of medicare, medicaid, and social security. For each the government will pay out whatever it costs to fund the retirement and health care programs. Then there is medium green money, so-called mandatory spending, which is money provided on a multi-year basis but with fixed amounts for each year. For example, federal aid for highways is mandated spending. That is, using hypothetical numbers, $5 billion is provided for year 1, $6 billion for year 2, and $7 billion for year three. The Democrats sought to load some of the cuts onto various mandatory spending programs. For example, cut $1 billion from year one of the highway as part of a package of reductions for the current fiscal year. But cutting that $1 billion leaves unaffected the $6 billion and $7 billion for years two and three. So the GOP pressed for more cutting from money that is light green -- the so-called discretionary funds that are provided on an annual basis. For example, cut the $4 billion community development block grant (CDBG) to just $1 billion. Thus, when CDBG funding is considered for the next year, the program base is just $1 billion with little prospect for getting more in a cut-spending atmosphere. More likely the next time the program would be ended completely.
The riders and medium green vs light green money is just part of the budgetary hell process and our ability to comprehend what's going on. The politics will become even more intense and vocal and public understanding more difficult when the spending issue turns to include finding a solution on how to cut the dark green money.
Sorry for the length of this posting, but the two subjects seemed to need some attention if only to add to the frustrations of trying to understand and judge what's going on in Cairo and Washington.
But what else seems to be occurring, according to a recent column by David Ignatius, is increasing factionalizing of the country's politics. That is, the largest political block, the Brotherhood, is splitting into several groupings with different views on the role of Islam in national life and constitutional role. Likewise the pro-democracy movement is dividing into several parties in its fight against the Brotherhood. If Ignatius is correct, this factionalizing has a kind of "let a thousand flowers bloom" character to it and thereby strengthen Egypt politically through diversity.
But to this blogger there is a definite downside to such fragmentation of Egypt's politics. It lays the foundation for political instability, hardly what Egypt needs as the next stage in its revolution against autocracy. It would also be an obstacle to Egypt's need for economic recovery and growth.
A multiplicity of parties means government by coalition, which in and of itself sounds acceptable, but unfortunately often leads to instability in dealing with urgent national needs. Such factionalizing and instability was the core of France's governing problem after World War II with the 4th Republic which led to DeGaulle's own revolution to replace it with the 5th Republic led by a greatly increased power of the President. Having just gotten rid of an autocratic President, most Egyptians would hardly be ready for a presidential dominant system so soon. And it is difficult to keep count of the number of governments Italy has had in the post war period because of party splintering. Coalitions also may lead to governing control by the most extreme ends of the political spectrum. In Israel, for example. Prime Minister Netanyahu., himself a conservative, is pushed further to the right because his governing coalition is dependent upon the support from the small, most far right parties.
Given Egypt's need for internal political stability as a pre-condition for economic recovery and growth, it is difficult for me to see the plus side of so much factionalizing as described by Ignatius. Unsettled political conditions won't bring the tourists back and certainly won't attract needed foreign investment. Now to Washington.
-0-0-0-0-0
"Abandon all hope, ye who enter here." Thus spoke Dante in the Divine Comedy: The Inferno regarding those at the threshold of entering hell. And thus it is with we mere mortals who seek to understand what goes on in Washington regarding the budget. Enough has been said about the pending final deal for the remainder of fiscal year 2011 that this posting won't use the space for repeating the terms of the deal, except to say that the tentative agreement on a cut of $38 billion over the next six months is peanuts in terms of the overall problem of spending, deficits, and debt. Rather, this posting is to give just a glimpse into the hellish budgetary process and why the efforts of the average American to follow the action seem doomed.
As the Republican-Democratic bargaining proceeded much attention was given to the "riders" and the GOP's effort, urged on by the tea party and other spending hawks, to attach its social agenda to the budgetary process. This is hardly a new strategy but it became front and center because it was central to the Democratic strategy to blame the GOP for any government shutdown over social policy issues rather than spending itself. Boehner and the GOP countered with"nonsense". The central issue is that Democrats don't want to cut spending for their favorite programs. In fact, both parties are simply playing politically to their liberal-conservative bases. Now to a very arcane issue of the shootout.
There is an old saying that "all money is green". It never was and the current confrontation shows that there are shades of green. Dark green money is spending on the major entitlements of medicare, medicaid, and social security. For each the government will pay out whatever it costs to fund the retirement and health care programs. Then there is medium green money, so-called mandatory spending, which is money provided on a multi-year basis but with fixed amounts for each year. For example, federal aid for highways is mandated spending. That is, using hypothetical numbers, $5 billion is provided for year 1, $6 billion for year 2, and $7 billion for year three. The Democrats sought to load some of the cuts onto various mandatory spending programs. For example, cut $1 billion from year one of the highway as part of a package of reductions for the current fiscal year. But cutting that $1 billion leaves unaffected the $6 billion and $7 billion for years two and three. So the GOP pressed for more cutting from money that is light green -- the so-called discretionary funds that are provided on an annual basis. For example, cut the $4 billion community development block grant (CDBG) to just $1 billion. Thus, when CDBG funding is considered for the next year, the program base is just $1 billion with little prospect for getting more in a cut-spending atmosphere. More likely the next time the program would be ended completely.
The riders and medium green vs light green money is just part of the budgetary hell process and our ability to comprehend what's going on. The politics will become even more intense and vocal and public understanding more difficult when the spending issue turns to include finding a solution on how to cut the dark green money.
Sorry for the length of this posting, but the two subjects seemed to need some attention if only to add to the frustrations of trying to understand and judge what's going on in Cairo and Washington.
Wednesday, April 6, 2011
THE BUDGET: A MESS AND GETTING MESSIER
What's going on with the budget is a mess. And it is a mess made worse by partisan politics. Part of understanding the mess flows from the fact that there are now two budgets in play. The first is the seemingly endless political confrontation over spending for the current fiscal year ending September 30. Now thrown into the mix is the budget for the next fiscal year, 2012.
In February President Obama presented his 2012 spending plan which calls for $3.7 trillion in expenditures and which projected savings of $1.1 trillion over the next decade. Now the House Republicans have come up with their own version which set spending for the next fiscal year at $3.5 trillion with major changes in spending, taxes, and health care that would supposedly save about $6 trillion over the next decade. Before taking a look at the GOP alternative budget for 2012 and beyond, a quick look at the continuing fight over this year's budget is in order.
In the previous posting, it was indicated that an agreement may be in the making that would cut spending by $33 billion to close out the current 2011 fiscal year. It was also suggested that GOP House Speaker Boehner may go for such a plan in part to draw a line in the sand for the tea party (TP) adherents who continue to demand a $61 billion reduction. It now seems that in Boehner's eyeball-to-eyeball confrontation with the TP, the Speaker blinked. That is, he now seems to be bending and going for more than the $33 billion, although not the full $61 billion demanded by the TP.
But what is worse, at least for public spectators, is that instead of finally wrapping up the 2011 budget conflict, the House Republicans are talking about another very short term measure to avoid a shutdown of government this Friday when current spending approval runs out. The latest rumble seems to be that the GOP is offering to add another week, to April 15, to the shutdown deadline and for that week cut spending by $12 billion. It is hard to escape the belief that all of this is just another case of smoke and mirrors to somehow make it appear to TP supporters that they are getting close to their $61 billion target. It is hardly any wonder that Congress stands so low in public approval. If that's not enough to confuse and confound, we now have a proposed GOP budget for next year and beyond, setting the stage for a new round of political rhetoric.
What the House GOP is proposing, and what may become the official Republican plan, is a three part strategy to tackle the generally acknowledged problem of deficit spending and growing federal debt. And here is where the GOP may have the public relations edge because it has set forth a plan for tackling the entitlements issue while Obama's budget does not. There's the old rubric about getting political agreement on significant issues -- "the devil is in the details". The problem with the GOP alternative budget is that the devil is in the basics, not the details. The three part strategy concerns overhaul of medicare and medicaid, tax policy, and general spending levels.
Overhaul of medicare and medicaid. This posting doesn't permit detailed discussion but the basic approach is vintage Republican. There is general agreement that overhaul of the basic health care programs is needed to get spending under control. But what the GOP proposes is that, except for those grandfathered by age into the current medicare system, health care for the elderly in the future would be funded by government subsidies to pay for policies provided by the insurance industry. In short, it would mean a huge number of federal dollars going to the private insurance bureaucracies which are already a significant part of the problem of health care delivery.
As to medicaid which operates through a federal-state grant system to provide health care to the lower income, the Republicans would convert that into a block grant which supposedly would give the states greater flexibility in delivering health care services to its poorer residents. Right now medicaid is what they call an open end appropriation which guarantees the feds will pay their share of the costs regardless of any increases because of expanding enrollment such as experienced with the recent recession. Given that states spend an average of 21 percent of their general fund budget on medicaid, they are certainly interested in ways to get the program costs under control. The GOP plan anticipates medicaid savings of $771 billion over the next decade. Under the GOP plan, the federal cost under a block grant would be set by fixed annual appropriations so if costs rose at the state level it would be left to the states to pick up the entire cost of any increases. This is just one aspect of the problems with the block grant approach. Giving the states greater flexibility over how they would use the money is another and perhaps scarier part of the issue.
Taxing. The GOP proposal carries no specifics of what would be done to overhaul the tax code to close so-called loopholes for both personal and corporate income. But there is a clear indication about the direction of any changes in the code. The GOP plan calls for permanent extension of President Bush's tax cuts which are a major source of the current deficit problem and which would mean locking in the heavy bias toward upper income earners. That bias is also found in the proposed change to lower the top corporate and personal income rate to 25 percent. And, of course, there is no allowance for tax increases which ultimately will be the only way we will pay down the debt.
Spending. Again no specifics except the general goal of cutting spending back to levels of about five years ago. It is reasonable to assume, based on the GOP track record, that spending on defense and other national security programs would be protected and allow for increases while the major burden of reduced spending would fall on a variety of other social and community oriented programs, veterans benefits, and federal (military and civilian) retirement.
That's a lot to digest in one posting so will sign off with the likelihood that more will be said as events unfold and political rhetoric moves front and center.
In February President Obama presented his 2012 spending plan which calls for $3.7 trillion in expenditures and which projected savings of $1.1 trillion over the next decade. Now the House Republicans have come up with their own version which set spending for the next fiscal year at $3.5 trillion with major changes in spending, taxes, and health care that would supposedly save about $6 trillion over the next decade. Before taking a look at the GOP alternative budget for 2012 and beyond, a quick look at the continuing fight over this year's budget is in order.
In the previous posting, it was indicated that an agreement may be in the making that would cut spending by $33 billion to close out the current 2011 fiscal year. It was also suggested that GOP House Speaker Boehner may go for such a plan in part to draw a line in the sand for the tea party (TP) adherents who continue to demand a $61 billion reduction. It now seems that in Boehner's eyeball-to-eyeball confrontation with the TP, the Speaker blinked. That is, he now seems to be bending and going for more than the $33 billion, although not the full $61 billion demanded by the TP.
But what is worse, at least for public spectators, is that instead of finally wrapping up the 2011 budget conflict, the House Republicans are talking about another very short term measure to avoid a shutdown of government this Friday when current spending approval runs out. The latest rumble seems to be that the GOP is offering to add another week, to April 15, to the shutdown deadline and for that week cut spending by $12 billion. It is hard to escape the belief that all of this is just another case of smoke and mirrors to somehow make it appear to TP supporters that they are getting close to their $61 billion target. It is hardly any wonder that Congress stands so low in public approval. If that's not enough to confuse and confound, we now have a proposed GOP budget for next year and beyond, setting the stage for a new round of political rhetoric.
What the House GOP is proposing, and what may become the official Republican plan, is a three part strategy to tackle the generally acknowledged problem of deficit spending and growing federal debt. And here is where the GOP may have the public relations edge because it has set forth a plan for tackling the entitlements issue while Obama's budget does not. There's the old rubric about getting political agreement on significant issues -- "the devil is in the details". The problem with the GOP alternative budget is that the devil is in the basics, not the details. The three part strategy concerns overhaul of medicare and medicaid, tax policy, and general spending levels.
Overhaul of medicare and medicaid. This posting doesn't permit detailed discussion but the basic approach is vintage Republican. There is general agreement that overhaul of the basic health care programs is needed to get spending under control. But what the GOP proposes is that, except for those grandfathered by age into the current medicare system, health care for the elderly in the future would be funded by government subsidies to pay for policies provided by the insurance industry. In short, it would mean a huge number of federal dollars going to the private insurance bureaucracies which are already a significant part of the problem of health care delivery.
As to medicaid which operates through a federal-state grant system to provide health care to the lower income, the Republicans would convert that into a block grant which supposedly would give the states greater flexibility in delivering health care services to its poorer residents. Right now medicaid is what they call an open end appropriation which guarantees the feds will pay their share of the costs regardless of any increases because of expanding enrollment such as experienced with the recent recession. Given that states spend an average of 21 percent of their general fund budget on medicaid, they are certainly interested in ways to get the program costs under control. The GOP plan anticipates medicaid savings of $771 billion over the next decade. Under the GOP plan, the federal cost under a block grant would be set by fixed annual appropriations so if costs rose at the state level it would be left to the states to pick up the entire cost of any increases. This is just one aspect of the problems with the block grant approach. Giving the states greater flexibility over how they would use the money is another and perhaps scarier part of the issue.
Taxing. The GOP proposal carries no specifics of what would be done to overhaul the tax code to close so-called loopholes for both personal and corporate income. But there is a clear indication about the direction of any changes in the code. The GOP plan calls for permanent extension of President Bush's tax cuts which are a major source of the current deficit problem and which would mean locking in the heavy bias toward upper income earners. That bias is also found in the proposed change to lower the top corporate and personal income rate to 25 percent. And, of course, there is no allowance for tax increases which ultimately will be the only way we will pay down the debt.
Spending. Again no specifics except the general goal of cutting spending back to levels of about five years ago. It is reasonable to assume, based on the GOP track record, that spending on defense and other national security programs would be protected and allow for increases while the major burden of reduced spending would fall on a variety of other social and community oriented programs, veterans benefits, and federal (military and civilian) retirement.
That's a lot to digest in one posting so will sign off with the likelihood that more will be said as events unfold and political rhetoric moves front and center.
Sunday, April 3, 2011
LIBYA, BUDGET AND TEA PARTY, TRUMP
Perhaps I misspoke, at least in part, in the previous posting. There I said that we can expect "ambiguities" and "nuanced refinements" on our political goals in Libya and our role in military intervention there. On the former, political goals, the wording of the posting still seems valid. The longer Gaddafi remains in power in at least part of Libya, the less clarity we can expect on "what do we do now?" We can continue to squeeze him militarily and economically, but giving any final substance to our "Gaddafi must go" policy will remain elusive and thus our pronouncements will be ambiguous. But on the other point, our military involvement, we have been given clarity by Defense Secretary Gates in his testimony before a Senate committee.
Assuming that what Gates says is definitive, it gives assurance to those who want to end our role as policeman to the world. Gates said three things which, if they are the policy of President Obama, are reassuring. First, the U.S. will have no "boots on the ground" in Libya, meaning no U.S. ground forces will be committed there. ("Boots on the ground" became a popular phrase in the 2003 invasion of Iraq when many critics of the invasion, while not opposing the invasion itself, said there weren't enough "boots on the ground" to do the job properly.) Second, the U.S. will not be arming and training the Libyan rebels. Other countries can do that job Gates said. That would certainly seem a wise decision given our experience in arming the mujahideen to oust the Russians from Afghanistan when many of those we armed morphed into the Taliban who then hosted al Qaeda after taking power. Third, we will no longer participate in NATO air strikes in Libya. That's a major policy choice that immediately drew criticism from military hawks Senators McCain and Graham. And point three apparently has some "maybe's" attached to it since the U.S. has already gone along with a NATO request for an air strike because of bad weather.
Will the Gates' policy pronouncements have staying power? We can only hope so but he has long ago declared his intention to leave office this year and we don't know if an equally firm person will follow.
0-0-0-0
The budget. The beat goes on but it may be sending a different message to the tea party (TP) spending hawks and their fellow travelers. GOP House Speaker Boehner, while remaining elusive on whether a compromise spending plan is near, seems to finally be telling the TP that it is going to have to live with an outcome that falls significantly short of their demand for a $61 billion cut in spending for the current fiscal year which ends September 30.
The talked about number if $33 billion and without some of the social policy items the TP wants included. But no deal has been done yet between the House GOP, Senate Democrats, and President Obama. What is most important, assuming some kind of deal is made before the April 8 deadline for congressional action or shutting down the government, is that Boehner is drawing his own line in the sand for the TP. And, of course, TP activists counter with their usual threats of "give us what we want or face TP opposition in next year's GOP primaries." If that line isn't drawn now, Boehner will have to face down the TP on the even bigger isses ahead -- raising the national debt ceiling later this spring and the size and shape of the GOP budget countering Obama's budget plan for next year.
The bottom line for the GOP in the House is whether the TP tail continues to wag the establishment dog, or the wagging stops here.
0-0-0-0
Crazy like a fox. When real estate mogul Donald Trump, an egotist always looking for the next mirror or TV camera, took firm sides with the right wing birthers who question Obama's natural born U.S. citizenship, the immediate reaction was that Trump is either a nut, just out on another publicity stunt, or simply pandering to the far right wing in case he does become a presidential candidate. But when you think about it, it really was a smart move for catching right wing attention to support any interest he may have in running for President. For any would-be Republican presidential candidate, pandering to the far right is a necessary rite of passage.
Trump could have spoken out against abortion, immigration reform, or gay rights, but the reaction would have been a big ho hum. But to say you're now a committed birther does get attention and it did. And perhaps the new attention to Trump as a birther also got him his new gig on Fox news.
So who is right? Trump for his seeming absurdity in becoming a birther or us for thinking he's a whacko?
Assuming that what Gates says is definitive, it gives assurance to those who want to end our role as policeman to the world. Gates said three things which, if they are the policy of President Obama, are reassuring. First, the U.S. will have no "boots on the ground" in Libya, meaning no U.S. ground forces will be committed there. ("Boots on the ground" became a popular phrase in the 2003 invasion of Iraq when many critics of the invasion, while not opposing the invasion itself, said there weren't enough "boots on the ground" to do the job properly.) Second, the U.S. will not be arming and training the Libyan rebels. Other countries can do that job Gates said. That would certainly seem a wise decision given our experience in arming the mujahideen to oust the Russians from Afghanistan when many of those we armed morphed into the Taliban who then hosted al Qaeda after taking power. Third, we will no longer participate in NATO air strikes in Libya. That's a major policy choice that immediately drew criticism from military hawks Senators McCain and Graham. And point three apparently has some "maybe's" attached to it since the U.S. has already gone along with a NATO request for an air strike because of bad weather.
Will the Gates' policy pronouncements have staying power? We can only hope so but he has long ago declared his intention to leave office this year and we don't know if an equally firm person will follow.
0-0-0-0
The budget. The beat goes on but it may be sending a different message to the tea party (TP) spending hawks and their fellow travelers. GOP House Speaker Boehner, while remaining elusive on whether a compromise spending plan is near, seems to finally be telling the TP that it is going to have to live with an outcome that falls significantly short of their demand for a $61 billion cut in spending for the current fiscal year which ends September 30.
The talked about number if $33 billion and without some of the social policy items the TP wants included. But no deal has been done yet between the House GOP, Senate Democrats, and President Obama. What is most important, assuming some kind of deal is made before the April 8 deadline for congressional action or shutting down the government, is that Boehner is drawing his own line in the sand for the TP. And, of course, TP activists counter with their usual threats of "give us what we want or face TP opposition in next year's GOP primaries." If that line isn't drawn now, Boehner will have to face down the TP on the even bigger isses ahead -- raising the national debt ceiling later this spring and the size and shape of the GOP budget countering Obama's budget plan for next year.
The bottom line for the GOP in the House is whether the TP tail continues to wag the establishment dog, or the wagging stops here.
0-0-0-0
Crazy like a fox. When real estate mogul Donald Trump, an egotist always looking for the next mirror or TV camera, took firm sides with the right wing birthers who question Obama's natural born U.S. citizenship, the immediate reaction was that Trump is either a nut, just out on another publicity stunt, or simply pandering to the far right wing in case he does become a presidential candidate. But when you think about it, it really was a smart move for catching right wing attention to support any interest he may have in running for President. For any would-be Republican presidential candidate, pandering to the far right is a necessary rite of passage.
Trump could have spoken out against abortion, immigration reform, or gay rights, but the reaction would have been a big ho hum. But to say you're now a committed birther does get attention and it did. And perhaps the new attention to Trump as a birther also got him his new gig on Fox news.
So who is right? Trump for his seeming absurdity in becoming a birther or us for thinking he's a whacko?
Subscribe to:
Posts (Atom)