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Economy

Democratic Senator Calls Out GOP’s ‘Rumpelstiltskin Fairy Tale’ On Taxes

By Pat Garofalo on Nov 8, 2012 at 6:25 pm

Speaker of the House John Boehner (R-OH) yesterday, in a move that many in the media deemed conciliatory, said that House Republicans are open to raising more revenue for the federal government, as long as it comes “as a byproduct of growing our economy, energized by a simpler, cleaner, fairer tax code, with fewer loopholes and lower rates for all.”

Believing that lower tax rates will magically raise revenue thanks to a growing economy is a favorite conservative fantasy. (It’s been dubbed believing in the “tax fairy.”) Today, Sen. Chuck Schumer (D-NY) responded to Boehner’s speech by calling it “a Rumpelstiltskin fairy tale“:

Schumer derided the theory that substantial revenues can be raised without increasing the tax burden on the wealthy.

“Part of his speech he talked about dynamic scoring, this idea if you cut taxes you increase revenues,” Schumer said.

“It’s about time we debunked that myth, it’s a Rumpelstiltskin fairy tale, dynamic scoring. You may remember Rumpelstiltskin was the fairy tale figure who turned straw into gold,” he added, making reference to the popular German children’s tale from the 19th century.

Many studies have shown “that tax cuts do not come anywhere close to paying for themselves over the long term.” Greg Mankiw, chair of George W. Bush’s Council of Economic Advisers, called those who believe that tax cuts will result in a revenue increase “charlatans and cranks.” “There is no serious research evidence to suggest that” tax cuts pay for themselves, Republican economist Douglas Holtz-Eakin agreed. But Republican leaders still claim that such a thing will happen, all evidence to the contrary.

NEWS FLASH

AG Holder May Step Down In Second Obama Term | During remarks at the University of Baltimore School of Law Thursday, Attorney General Eric Holder said he is unsure whether he will keep his post for a second term, CBS DC reports. “That’s something that I’m in the process now of trying to determine,” Holder said. “I have to think about, can I contribute in a second term?” Holder, the first African-American attorney general, has led the Department’s vigorous efforts to enforce the Voting Rights Act, and first announced in 2009 that the Department would no longer defend the Defense of Marriage Act. He has withstood vicious attacks by Senate Republicans and was held in contempt of Congress for his alleged participation in a botched gun sting operation known as “Fast and Furious.” A DOJ inspector general’s report later cleared him of any wrongdoing. According to a Wall Street Journal story on Obama’s second term, Holder has said he wants to stay long enough to mark the 50th anniversary of several civil rights milestones.

Health

Newly Elected Congress Could Push Reluctant States To Expand Medicaid

By Tara Culp-Ressler on Nov 8, 2012 at 6:00 pm

Now that the 116th Congress has been elected and 80 new members are headed to Washington, new legislative bodies in states across the country could help governors move forward with the some of the health care decisions they’ve been putting off.

In Colorado, for example, the new Democrat-controlled House hopes to pressure Gov. John Hickenlooper (D) to officially accept Obamacare’s expansion of the Medicaid program, which could benefit an additional 200,000 Colorado residents. Some governors, including Hickenlooper, have been dragging their feet on deciding whether to participate in the expansion — even though expanding Medicaid would help extend coverage to millions of additional low-income Americans who currently can’t afford health insurance. The governor has yet to take a position on the issue, but the new legislature wants to change that:

Tuesday’s election results ensure that implementation of Obamacare will proceed on a fast track in Colorado and Democratic lawmakers want to move ahead with Medicaid expansion that could bring health coverage to nearly a quarter million low-income Coloradans.

“We would like to push to get health care to as many people as possible because that’s going to reduce the costs for everyone,” said Rep. Mark Ferrandino, D-Denver, who is expected to take the reins of the Colorado House in January after Democrats recaptured control of it on Tuesday. [...]

“With the feds picking up 100 percent in the beginning…I think there’s a great opportunity for innovative solutions to make sure we can fund the health care expansion,” Ferrandino said. “I feel pretty confident we’ll be able to do it.”

If governors like Hickenlooper fail to expand Medicaid, some studies warn that they will compromise the work of safety-net hospitals — which tend to serve the most vulnerable populations of Americans, like the poor and the underinsured — by costing them billions of dollars of funding. The Colorado Hospital Association has already come out in favor of the expansion in the state.

Nevertheless, GOP governors in states with some of the highest rates of uninsurance in the nation are refusing to participate in the expansion, denying millions of low-income Americans access to the critical health coverage they need. If the new Colorado congress members have anything to say about it, though, their own state won’t follow down that path.

Health

Boehner: ‘Obamacare Is The Law Of The Land’

By Tara Culp-Ressler on Nov 8, 2012 at 5:22 pm

As ABC News reports, House Speaker John Boehner (R-OH) has confirmed that the House GOP will no longer attempt to repeal the Affordable Care Act. When asked about the future of the health care reform law, Boehner said “the election changes that” and “Obamacare is the law of the land.”

During President Obama’s first term, House Republicans spent over 80 hours and $50 million dollars on more than 30 failed attempts to repeal Obamacare.

Boehner did suggest that some parts of the law — presumably the Independent Payment Advisory Board — could “be on the table as lawmakers work toward a balanced budget.”

The Board, or IPAB, is tasked with making binding recommendations to Congress for lowering health care spending, should Medicare costs exceed a target growth rate. Congress can accept the savings proposal or implement its own ideas through a super majority. Some Democrats have joined Republicans in opposing the provision.

Update

Boehner’s office is softening the Speaker’s comments:


Economy

Notoriously Abusive Chinese Company Foxconn Looking To Open Plants In The U.S.

By Aviva Shen on Nov 8, 2012 at 5:15 pm

During the last stages of the campaign, Mitt Romney falsely tried to claim that American manufacturers like Chrysler were moving production to China. As it turns out, at least one company is planning the opposite move: Foxconn Electronics, the notoriously exploitative Apple Inc. manufacturer, is reportedly testing the waters to open new plants in US cities. Foxconn attracted scrutiny earlier this year when its abusive labor practices in Chinese and Taiwanese factories were exposed in a series of New York Times articles.

According to Chinese newspaper DigiTimes, Foxconn is conducting evaluations in Detroit, Los Angeles, and other cities to possibly open plants focused on LCD television production. The company is also discussing a partnership with Massachusetts Institute of Technology that would bring American engineers to China and Taiwan to learn Chinese and study product design processes.

Foxconn became a household name in the US after a mostly exaggerated and false This American Life segment detailed its mistreatment of workers. Despite the mythology presented in the episode, certain core facts were verified. Foxconn workers live in overcrowded company dorms, working shifts of 12 or more hours, and risk serious injury in appallingly dangerous working conditions. As many as 137 employees fell ill after being forced to clean iPads with toxic chemicals, and 17 Foxconn workers committed suicide in the past five years. The company has also been accused of forcing student interns to assemble iPhones.

Under pressure, Foxconn raised wages for employees and reduced hours, but its still far from meeting basic labor standards. After the company admitted it was struggling to meet demand for the iPhone 5, rumors of a strike over “overly strict demands” emerged.

While the company’s US factories would need to comply with American labor regulations, Foxconn continues to ignore Apple’s health and safety standards abroad with little consequence.

Alyssa

The Supreme Court Will Not Unbundle Cable

By Alyssa Rosenberg on Nov 8, 2012 at 5:07 pm

I missed this in the midst of election anxiety on Tuesday, but the Supreme Court just refused to take a case charging that cable bundling is in violation of federal anti-trust laws. As Deadline reports:

The U.S. Supreme Court today refused to hear the appeal of a class action lawsuit filed by cable and satellite subscribers who argued that channel bundling violated antitrust laws. The subs had asked the court to require programmers and distributors to offer single channels for purchase, rather than sell them only in prepackaged tiers. In March, the Ninth Circuit Court of Appeals dismissed the suit filed against NBCUniversal, Comcast, Time Warner Cable and others, saying the plaintiffs had not stated a plausible claim.

In a sense, this is a reaffirmation of something we’ve discussed here quite a bit: bundling and the cable business model as currently constituted are inseparable, and many, many millions of people are willing to accept the model as is, even if they don’t love it. Getting around this without killing enormous amounts of programming (something, again, as I’ve said before, that I would be okay with!) is going to take an enormous amount of innovation, and a lot of time, and in the end, individual channels in the bundle will probably cost more than we sense they ought to. In a way, I wonder if the first goal for the cord-cutting or a la carte movements ought to be targeting the provision of internet, cable, and phone services by the same company. Those kinds of bundles are convenient from a customer service perspective. But in terms of preserving the free flow of content, unrestricted by companies who have an interest in slowing down web-based alternatives to cable, that’s a bad incentive structure for the companies themselves, and poses risks for consumers who want real content choices in the future.

Justice

The NRA Got Its Clock Cleaned On Election Day And Planned Parenthood Cleaned House

By Ian Millhiser on Nov 8, 2012 at 5:00 pm

The National Rifle Association spent much of President Obama’s first term touting increasingly paranoid claims that the United Nations is coming for everyone’s guns, and that President Obama’s non-existent record of new gun regulations is actually “a massive Obama conspiracy to deceive voters and hide his true intentions to destroy the Second Amendment in our country.” If last Tuesday’s election results are any sign, America was not buying what the NRA was selling.

According to data from the Sunlight Foundation, candidates supported by the NRA performed miserably this election cycle — just 0.81% of the NRA’s American Political Victory Fund’s spending backed winning candidates. In addition to about $9.3 million spent to elect Mitt Romney, the NRA’s top money-getter was Richard Mourdock — the Indiana U.S. Senate candidate who disqualified himself after suggesting that pregnancies resulting from rape are a “gift from God.” Other senate candidates who did not get elected despite the NRA’s best efforts include Ohio’s Josh Mandel, Virginia’s George Allen, Florida’s Connie Mack and Mourdock’s biologically challenged co-ideologue Todd Akin.

Meanwhile, the most successful groups evaluated by Sunlight were the Planned Parenthood Action Fund and Planned Parenthood Votes, both of which spent about 98 percent of their money on successful candidates.

Climate Progress

Sen. Majority Leader Reid: ‘Climate Change Is An Extremely Important Issue For Me, And I Hope We Can Address It’

By Joe Romm on Nov 8, 2012 at 4:52 pm

We are seeing a unique confluence of events put a carbon tax squarely back into the national debate: the debt crisis and fiscal cliff, Hurricane Sandy, and the results of the 2012 election.

Sen. Majority Leader Reid said Wednesday:

“Climate change is an extremely important issue for me and I hope we can address it reasonably. It’s something, as we’ve seen with these storms that are overwhelming our country and the world, we need to do something about it.”

Back in August Reid spoke to Greenwire following one of the most powerful public speeches on climate that any national policymaker has made in years:

Reid said he hopes the Senate will take up a bill to put a price on carbon emissions if Democrats maintain control of the chamber….

Reid now has a much stronger hand. Democrats picked up 2 seats in the Senate. A few months ago Republicans were thought to have a good chance of seizing control of the Senate — now they have undercut their chances of taking back the Senate even in 2014. And newly elected Senators Angus King (I-ME) and Elizabeth Warren (D-MA) both explicitly campaigned on climate change.

No, Reid can’t do this single-handedly. But President Obama, reelected with the help of a decisive youth vote that rightly puts climate change near the top of the list of their concerns, himself said on election night:

“We want our children to live in an America that isn’t burdened by debt, that isn’t weakened by inequality, that isn’t threatened by the destructive power of a warming planet.”

In  the coming days and weeks, Climate Progress will explore the prospects for a carbon tax from all angles. We’ll also explore other policies that could potentially achieve the same kind of reductions. And we’ll try to set the record straight when we think the media doesn’t get it quite right, as with this CNN Money article, “Climate change is back on the table“:

Read more

Security

No, The Welfare State Did Not Cause Europe’s Decline

By Zack Beauchamp on Nov 8, 2012 at 4:50 pm

Bombed out Berlin.

One common thread throughout the conservative freakouts after President Obama’s reelection is that America is over; that it will “go the way of the Europe” as a consequence. This Fox News conversation, between Steve Doocy and Mark Steyn, perfectly encapsulates the meme:

DOOCY: So is our country in a cultural decline? How do we turn it around? Let’s talk to columnist Mark Steyn. … Mark, once upon a time, you were born in Canada. But you decided that you wanted to head south, young man, to the land of opportunity. Now as it turns out, we’re not just opportunity, we’re entitlement.

STEYN: Yeah, that’s right. I’d heard about thing called the American Dream. They don’t really have a Canadian Dream or Belgian Dream or a Greek Dream. [Doocy laughs]. There was an American dream. I wanted a piece of it. Just as I got here, the United States decided to adopt the policies that have brought the rest of the Western world to ruin. When the takers are able to outvote the makers, you are a nation in steep decline.

Watch it:

This narrative, pervasive though it might be, badly misconstrues American politics and European history. Even setting aside the absurd takers/makers frame, Obama simply has not instituted staple European policies like a maximum work week, direct public provision of health care along the lines of the British National Health Service, or taxing top earners at roughly 50 percent. Even Obama’s hated spending increases didn’t bring us closer to a Greece-like budget crisis: too-low taxes, rather than too-high spending, explain why some European countries are budgetarily worse off than others today.

But even if Obama had attempted to replicate the European welfare state to a T, it wouldn’t be relevant: neither Europe’s current crisis nor “decline” in international power (in terms of military strength) were caused by Europe’s social safety net. The central reason that Europe isn’t as powerful internationally as it once was is, quite simply, one Great Depression and two World Wars. By the end of World War II, European states were virtually leveled and hence unable to function as global powers. As one RAND institute paper puts it, “[there were] 39 million deaths in Europe alone. Large amounts of physical capital were destroyed as well through six years of constant ground battles and bombing. … Periods of hunger become more common even in relatively prosperous Western Europe.” These economic aftershocks, together with the push for self-determination from previously colonized people, meant European states couldn’t sustain their prior model for global power. Europe decided to instead partner with the United States and gradually refocus its military efforts on defense rather than global reach.

One way to confirm this is to look at European military spending. Were it the welfare state that collapsed Europe’s international military might, then military spending should have declined gradually over the course of the late 40s to 70s, when various European welfare states were being constructed. Instead, Europe’s aggregate defense spending remained at roughly 3.1 percent of GDP until collapse of the Soviet Union, which caused a steep decline to about 1.7 percent in 2008. Thus, the rise of the welfare state didn’t trade off with European military might — it was the lack of a threat worth spending money on.

NEWS FLASH

Victory For Mark Takano, Congress’s First Gay Person Of Color | Mark Takano (D) has declared victory in his California Congressional race that had earlier been too close to call. Not only does Takano join the largest delegation of openly LGBT members of Congress ever, but he also makes history as Congress’s first-ever openly LGBT person of color. The only out candidate whose race remains to be called is that of Kyrsten Sinema (D-AZ), who is poised to become the first openly bi member of Congress.

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