What’s the Story with Obama?

A lot of people on the left have been talking about Drew Westen’s piece, “What Happened to Obama,” in the New York Times yesterday. Here’s a link, in case you missed it – but if so get it today or run into their paywall.

Westen, like many (me too) wants to bring back the New Deal. More important, he understands that politics is built on stories. He wants Obama to tell a story about incredibly wealthy people in investment banks, hedge funds, and (my addition) bond-rating agencies, whose major motivation is to be come even wealthier. These people’s greed caused the economic collapse of 2009, and they should pay the costs. Instead, the government has been bailing them out. We’ve let the banks who issued fraudulent mortgages get off free, while doing very little to alleviate the suffering of those they swindled, and who now risk losing their homes.

It’s a powerful story, and Westing tells it much better than I just have! However, he barely mentions (except in a few words at the end) that there is another story. In this story, the problem is squabbling politicians who are so focused on their partisan maneuvers that they don’t care about ordinary people’s problems.

Most Americans believe both stories. As far as I can tell, Obama only believes the second. When he compromises with the Republicans on their terms (or on mixed terms, as with the budget deal last December), that is the story he has in mind. He wants people to see him as someone who really cares about their problems, who will sacrifice his own partisan views if he has to do that to save jobs, to prevent default, or anything else of major public importance.

That story was the basis of Ross Perot’s appeal, and it always worked for him. The trouble is, Obama is actually running the country. To really win, he has to do more than show that he cares about the nation’s problems. He has to solve those problems. The compromise solutions he goes for don’t.

It’s pretty clear what we need: massive job creation to get the economy going, then letting the Bush tax cuts lapse and getting out of the wars in Iraq and Afghanistan, so that the new revenue from economic growth can go into basic public services and deficit reduction. But you can’t get that program through bipartisan compromise, because the Republicans are dead set against it.

Remembering Hiroshima and Nagasaki

This weekend marks the 66th anniversary of the first – and only – uses of atomic bombs in war. On August 6, 1945 the US dropped the first wartime nuclear bomb ever on the Japanese city, Hiroshima. On August 9 a second nuclear bomb was dropped on another city Nagasaki.

The Hiroshima bomb eventually killed 140,000 people – some right away, many others later of radiation poisoning. The justification offered was that the bombing was needed to bring a quick end to the war; otherwise, the argument went, American troops would have had to continue the series of difficult amphibious assaults in which so many had died already as the US fought its way, island to island, across the Pacific. The most eloquent statement of this argument, in my opinion, was made by the essayist Paul Fussell in Thank God for the Atom Bomb.

Others – like my friend Gar Alperovitz in his book The Decision to Use the Atomic Bomb – deny that using the bomb was necessary to get a quick Japanese surrender. The real reason, according to this school, lay in the politics of what was to become the Cold War. It was well known that the USSR was about to declare war on Japan, and thought likely that such a declaration would lead to a Japanese surrender. President Truman wanted the US, not the USSR, to get the credit for forcing a surrender; and he wanted to demonstrate to the world that the US had a terrifyingly powerful weapon.

If the second argument is correct, the decision to drop the bomb seems moreally questionable. It’s one thing to save your people’s lives by killing a lot of your enemy; it’s quite another to kill 140,000 people for purely political reasons.

Whatever the truth about Hiroshima, though, I have never understood how bombing Nagasaki could be justifiable. The demonstration had been made, the Japanese had been shocked, the Russians had been kept out – so what was the purpose? There is a strong suspicion (not only by me) that the second bomb was dropped only because it used a different technology from the first, and the military people wanted to see how well it worked in comparison. I hope that’s not true – it’s barbaric – but I’ve never heard another explanation that is the least bit convincing.

I always try to pause for a moment at this time of year and think about these two terrible events. Now that the Cold War is over, there is no need for nuclear weapons. They are slowly proliferating to more countries, and will continue to do so – unless and until we in the US commit to getting rid of our own nuclear weapons as part of a move to a nuclear-free world. It’s time to do this.

Is Standard & Poor’s Downgrade of America Legitimate?


That’s the short answer. To spell it out a little more, Standard and Poor downgraded the rating of US securities because it thinks the US has too much debt and no clear commitment to paying it off.

So what? Many Americans think the same thing. Others, like me, thing that the important thing right now is to stimulate the economy and create more jobs; doing that would require – temporarily – a larger deficit, until the resulting prosperity raised revenues and let us bring it back down.

Whatever you think, though, that is a political decision, to be made through democratic processes. It is not something that should be (or can be, fortunately) dictated by a ratings agency.

Much is being said about S&P’s basic incompetence. Their original downgrade statement was based on a calculation of the national debt that was off by two trillion dollars, and they were one of the companies that gave top ratings to junk-quality mortgage-based derivatives a few years ago. But that’s not even the point. They have absolutely no legitimacy in downgrading America as a way to impose their policy preferences.

The only legitimate concern over America’s debt is whether we will pay it. After the fiasco earlier this week, that’s a real concern. We should get rid of the debt ceiling, or at a minimum Congress should agree to go back to treating periodic increases in the debt ceiling as routine housekeeping. But bringing down the deficit has nothing to do with our ability to pay our debts.

Much as I would like to see the Bush tax cuts reversed (and S&P mentioned this as an issue) we don’t need to do that in order to pay our debt service. We can always pay the debt, if we decide to (and we should) because we are a sovereign nation and control our own money. (If you are thinking of Greece, that’s the big difference – they don’t. Their money is controlled by the European Central Bank). The very worst that can happen is that we will pay the debt by issuing more money. That may not be the ideal way to do it, but it does make US government debt perfectly secure, unless Congress refuses to raise the debt ceiling again – and they are not going to do that.

One last point: S&P first set the US rating at AAA in 1941, as the US was accumulating the hugest deficits (as a percentage of GDP) that it has ever had, in order to pay for the war. If US debt was a secure investment then – and it was – it is a secure investment now.

On Wisconsin

Everyone is saying the same thing about the stock market crash yesterday (Thursday, August 4): job creation, not deficit reduction, is what we need right now. So I won’t bother saying again, but will discuss something more important instead: the Wisconsin recall elections in six State Senate districts next Tuesday, August 9.

The recalls grew out of the storm of protest last winter against Republican Governor Scott Walker’s bill to strip state workers’ unions of collective bargaining power. As you probably remember, all the Democratic state senators left the state to prevent the bill from passing, but eventually it did. In the meantime, however,  there were massive protest demonstrations in Madison, in and around the state Capitol, for weeks.

The anger against Walker and the Wisconsin Republican party lead to campaigns to recall Republican state senators. In Wisconsin, you can only recall a political office-holder who has been in office for one year, so recall petitions were filed against all six Republicans who had been in the Senate for longer than that. The Republicans filed petitions against 3 Democratic senators, as well. The first won reelection in July, the other two will be coming up next week. Wisconsin recalls are basically a special election between the incumbent and the nominee of the other party. If 3 of the 6 Republicans are defeated on the 9th, and the 2 Democrats hold onto their seats, the Democrats will take control of the Senate, and be able to block the right-wing legislation that Walker and the Republicans have been pushing through. They won’t be able to repeal anything, but they will also build momentum toward the next election, and toward an anticipated campaign to recall Governor Walker next January.

Why is this so important? First, obviously, it will show that progressive forces can win, and perhaps suggest that the right-wing tide that rose with the Tea Party is now turning. That will not only change things in Wisconsin, but also give progressive politicians everywhere the courage to be more assertive in advancing their policies, rather than sticking to a defensive position.

But beyond that, it is about unions. Unions do far more than improving the lives of their members – although they certainly do that. They are also the most important institutional support for progressive politics. Unions have been declining in strength, and even in legal rights, for the last few decades, a trend that accelerated with the Reagan administration and has not slowed until very recently.

The Obama administration has begun to reverse some of the anti-labor policies of the past, and the Republicans are digging in to resist those reversals. That’s what the recent shutdown of the Federal Aeronautical Administration was all about: the board that regulates air unions had ruled during the Bush administration that unions would have to get a majority of all eligible voters, rather than a majority of those voting, in order to be designated to represent a bargaining unit. In other words, those who didn’t show up to vote would be counted as “no” votes. Obama’s appointees had reversed this decision, and the Republican House has been trying to reinstate it through legislation – and refusing to reauthorize the FAA unless the Senate would agree.

Walker’s bill was part of this general assault on labor rights. It not only took away the power of state workers’ unions to bargain over benefits, it also ended the collection of union dues through payroll deduction; union members now have to pay their dues directly to the union themselves. Obviously, Walker’s hope is that many workers simply won’t pay, depriving the unions of their participation and their money, and weakening them as a result.

The Citizens United case gave corporations the amount to spend unlimited amounts of money to influence elections. Most of this money will be spent to further the cause that is dearest to the hearts of those who own the big corporations: increasing inequality. The rich want to get richer (quite naturally); and the only way that they can do that is to make the rest of us poorer. They’ve been doing pretty well at this, because most of the resources are on their side. Restoring the strength of labor unions can provide a powerful weapon to resist them, and to promote the cause of greater equality.

The Overworked 14th Amendment

You have to have some pity for the 14th Amendment. Designed to make sure that the end of slavery (accomplished by its predecessor, the 13th) would be permanent, it has been expanded in so many ways.

For example, it has become the basis of “birthright citizenship” for the children of undocumented immigrants, since one of its provisions states that:

All persons born or naturalized in the United States and subject tothe jurisdiction thereof, are citizens of the United States and of the State wherein they reside.

That particular interpretation is pretty well established, since it was part of the Congressional debate about proposing the amendment back in 1866, and was explicity confirmed by the Supreme Court in U.S. v. Wong Kim Ark in 1898. Some anti-immigration activists want to change it, but for the most part they understand that they would have to amend the Constitution to do so.

The 14th Amendment has also – less legitimately, in my opinion – become a major bulwark of the political power of corporations, most recently in the Citizens United decision that corporations (and labor unions) could not be barred from spending as much money as they wanted to try to influence elections. That decision was rooted partly in the 1st Amendment, but also in the following provision of the 14th:

…nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.

Current interpretations of that language hold that corporations are persons, and therefore hold all the rights of human beings. Mountains have been written about that, and I shall not add to them here.

The latest effort to expand the 14th came during the recent debate on raising the ceiling on federal debt. I was all for raising the ceiling, without any restrictinos (see my last several posts). I’d go even further, and authorize the government to borrow money without any statutory limit. After all, we always have to raise the limit when it is reached, so why go through the charade?

However, I am just not convinced by the well-meaning attempts to say that the President has the authority to raise the ceiling without Congressional approval. These attempts are grounded in Section 4 of the Amendment, which begins:

The validity of the public debt of the United states, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.

This means, the argument goes, that the U.S. has to pay its debt service, even if that requires borrowing beyond the debt ceiling. Sorry, I wish it were so, but that interpretation is just not supported by the amendment’s language, for several reasons:

  • First, if you skip a payment on your mortgage, you are not questioning the validity of the mortgage – you still owe the money, and expect to have to pay it or lose your house. You are just unable to make a payment at that time. Similarly, even if the US did default-a horrible prospect- it would not be saying that the national debt was ‘invalid.’
  • In any case, if the US rolled over notes that came due, borrowing money in order to pay them, doing so would not change the total amount owed, so the debt celing would not be a problem. Borrowing to pay the interest would be another matter, but see below.
  • Finally, the government still has revenue coming in all the time; it is just not coming in fast enough to pay all the bills. So if you interpret the 14th to mean that payment of debt is Constitutionally required, that would just mean that debt service would get the first claim on revenues. It is very unlikely that debt service alone would exceed total federal revenue, so it could get paid. Again, the consequences would be terrible – lots of other desirable, even vital government functions couldn’t be carried out – but ‘terrible’ is not the same as ‘unconstititional.’

I understand the idea of threatening to use the 14th Amendment as a scare tactic. However, I don’t think there is a good legal argument for it; and I don’t think we should accept the practice of having Presidents change the meaning of the Constitution to meet the political needs of the moment.

Political Lessons from the Debt Deal

OK, it’s over (or will be unless the Senate surprises everyone), time to move on — but first, just two quick points about what we can learn from the debt ceiling clash.

1. A lot of people are complaining that the Washington politicians didn’t solve the problem until the last minute. That completely misses the point — it was not possible to solve it until the last minute. Unless you are actually at the deadline, you have no reason to give up the things that are important to you. It is only the reality of impending catastrophe that will get you to do that. We can see the same thing with the federal budget. In the 1960s, the fiscal year started July 1, and Congress never passed the budget on time – so they moved the fiscal year back 3 months, to October 1. Congress still never passes the budget on time, because they need to be right at the deadline in order to compromise.

2. It follows that you win these disputes by being willing to go closer to the deadline than the other side. The Tea Party was willing to kill a deal on Friday; not enough progressives were willing to kill a deal later than that. So the Tea Party got a lot of what they wanted, while progressives got very little.

OK, enough of that (though of course your comments will be welcome). Time to move on to other issues! (Unless, again, the Senate surprises us all!)

My Fantasy Deal

OK, I’m dreaming – but this could really happen.

1. Enough progressive House members vote against the debt deal to defeat it.

2. Wall Street, desperate at all the money they’re going to lose, tell their people in Congress to fix this problem quick.

3. At the last minute, Congress takes up a new bill to raise the debt ceiling without any of the policy riders – no cuts, no new revenue, nothing.

4. All the House Democrats vote for the clean debt ceiling increase, while Boehner (and Wall Street) round up enough Republicans to let it squeak through.

5. In the Senate, the Repulicans don’t have to vote for it, but they have to agree to cloture – see above comment about Wall Street.

If all that happens, we avoid default AND avoid throwing the country back into a deep recession, as the present deal is likely to do. (See Robert Reich’s excellent blog for a full explanation why this is likely.)

As I said, it’s a fantasy. Except for a few courageous individuals like Raul Grijalva, the House progressives won’t have the nerve.

Bad Deal on Debt

Bernie Sanders, the independent socialist senator from Vermont, voted against cloture on the Reid version of a debt ceiling dea. I say good for him! (I don’t like the filibuster, but as long as it exists we can’t leave it to only one side to use). The Reid bill was a bad deal – and the one they apparently agreed to on Sunday afternoon (July 31) is even worse. It makes cuts in important social service programs, reputedly including Medicare, and threatens to cut Social Security in the next round.

As Greg Sargent pointed out today in his Washington Post blog, “The Plum Line,” this deal is a huge victory for the Republicans in general and the Tea Party in particular. Why were they able to win so big? Because they, unlike the progressives, were willing to risk catastrophe in order to get their way. I think it’s time for progressives to respond in kind. 

For the last few days Wall Street bankers have been all over Congress telling them they have to raise the debt ceiling. Congress is going to listen to them — the Republicans in particular. So it’s Wall Street that should have to make some concessions.

Let’s not worry about taxing the rich. That will happen anyway, automatically, in just over a year when the temporary tax cuts expire. Instead, the essential point is no cuts! (Or maybe cuts only from getting out of Afghanistan and Iraq.) There is absolutely no need to include any deficit-reduction measures in a debt-ceiling vote. They are different issues, and should be handled in separate bills. This is nothing but an attempt by the minority party to impose its will on the majority, and it should be resisted.

Rep. Raul Grijalva, chair of the House Progressive Caucus, has vowed to fight the deal and called for the obvious alternative: a “clean” vote on raising the debt ceiling, with no conditions attached. Leave it to Wall Street to get the Republicans in line, rather than trying to buy the latter off with cuts on social services. That’s the way to go.

Two Things to Remember about the Debt Ceiling Crisis

Let’s keep it simple. If enough people understand these two points, I think the crisis can be resolved.

1. It’s not a crisis of the budget or the deficit. It’s a crisis about the debt ceiling. We may or may not need tax increases or spending cuts as a matter of economic health. We do NOT need either in order to resolve the debt ceiling crisis. All we need is for Congress to vote to raise (or better, eliminate) the debt ceiling. That would let the world go on while Congress and the President turn to a real debate about the budget and the economy.

2. The Tea Party is opposed to raising the debt ceiling. That means that they will vote against ANY solution. And THAT means that Speaker Boehner needs Democratic votes in order to pass a solution through the House. I think he knows that, but if he doesn’t we are really in trouble.

Speaker Boehner, Remember Newt Gingrich?

House Republican leader John Boehner’s debacle last night (July 28, 2011) has a basic common element with the failure of a previous Republican speaker, Newt Gingrich, in 1995. Each failed to understand the difference between the parliamentary and presidential systems of government.

In a parliamentary system, either there is only one house in the legislature, or one house has all the real power, so if a party has a majority of that house, it rules. The leader of the majority party is the leader of the government, and gets an appropriate title, such as “prime minister.” Newt Gingrich actually said in early 1995 that he was effectively the prime minister of the United States.

That is not the system we have.

In a presidential system, such as ours, different institutions possess independent power, and must come to agreement to get things done. In the US, the House, Senate, and President must all agree.

In 1995, the Gingrich shut down the government because he thought he could force President Clinton to accept his budget. He was wrong. Clinton vetoed the budget, the government shut down, the public blamed Gingrich, and he was soon out of office.

In 2011, Speaker Boehner is in a weaker position than Gingrich – both the Senate and the White House are controlled by the other party. In a presidential system, the best strategy in such a circumstance is to work for a compromise where you can achieve some, but not all of your goals. Instead, Boehner has tried to use control of the House, and a certain amount of momentum from the 2010 election, to dictate what happens. As of now, he appears to have failed.

Boehner’s specific mistake was to ask the House to pass a debt-ceiling bill that was going nowhere. The President had already announced that he would veto the bill, a majority of the Senate had said they would vote against it, and the Senate Majority Leader had promised to take up the bill and kill it the same night the House passed it.

In those circumstances, the Speaker needed the votes of the Tea Party Republicans to pass his bill; but they had little reason to vote for it. Doing so would violate their own beliefs, anger the voters who had elected them, and place them in danger of primary challenges. In return, they would get nothing – a bill that would be dead as soon as it passed. Leaders who know which system they are operating in ask for tough votes only when they really need them, and help their members avoid tough votes when they don’t need them. Boehner was attempting to do the opposite, and he failed.

It now appears that Boehner may lose the speakership. It’s a bit early to say that; but he has certainly lost this battle. Let’s hope the next Speaker remembers what kind of political system this is.