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Posts For: December 7, 2012

WH Running Out Clock on Fiscal Cliff Negotiations?

Because Republicans are more likely to be blamed for any fiscal cliff fallout, the closer they get to the deadline the more pressure they’ll be under to make concessions. Which is why the White House is slow-walking negotiations, according to John Boehner:

Speaker John Boehner (R-Ohio) accused the White House Friday of trying to “slow-walk” the “fiscal cliff” negotiations.

Boehner said there was “no progress” in the talks just three weeks before tax hikes and spending cuts are set to kick in, and expressed frustration that President Obama hasn’t made a counter-offer to the GOP’s proposal of $800 billion in new tax revenue as part of a $2.2 trillion deficit-reduction plan. 

“This isn’t a progress report, because there’s no progress to report,” Boehner said in a brief press conference at the Capitol. 

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Because Republicans are more likely to be blamed for any fiscal cliff fallout, the closer they get to the deadline the more pressure they’ll be under to make concessions. Which is why the White House is slow-walking negotiations, according to John Boehner:

Speaker John Boehner (R-Ohio) accused the White House Friday of trying to “slow-walk” the “fiscal cliff” negotiations.

Boehner said there was “no progress” in the talks just three weeks before tax hikes and spending cuts are set to kick in, and expressed frustration that President Obama hasn’t made a counter-offer to the GOP’s proposal of $800 billion in new tax revenue as part of a $2.2 trillion deficit-reduction plan. 

“This isn’t a progress report, because there’s no progress to report,” Boehner said in a brief press conference at the Capitol. 

The White House’s refusal to negotiate on tax rates has little to do with economic concerns — ending tax cuts for top earners would make barely a dent in the deficit. As Charles Krauthammer writes, it’s all part of Obama’s longer political game:

Such nonsense abounds because Obama’s objective in these negotiations is not economic but political: not to solve the debt crisis but to fracture the Republican majority in the House. Get Boehner to cave, pass the tax hike with Democratic votes provided by Minority Leader Nancy Pelosi and let the Republican civil war begin.

It doesn’t even matter whether Boehner gets deposed as speaker. Either way, the Republican House would be neutered, giving Obama a free hand to dominate Washington and fashion the entitlement state of his liking.

Democrats have a tough road to taking back the House in 2014. But if Republican leadership caves on tax hikes, conservative members will revolt, and incumbents up for reelection may be faced with a primary backlash. Obviously that could make it easier for Democrats to compete for the seats.

But if Republicans don’t cave, and go off the cliff, they’ll get blamed for the economic fallout. Most Democrats seem confident the GOP won’t let this happen, and will be willing to make serious concessions to avoid it. Krauthammer suggests Republicans call that bluff:

What should Republicans do? Stop giving stuff away. If Obama remains intransigent, let him be the one to take us over the cliff. And then let the new House, which is sworn in weeks before the president, immediately introduce and pass a full across-the-board restoration of the George W. Bush tax cuts.

Obama will counter with the usual all-but-the-rich tax cut — as the markets gyrate and the economy begins to wobble under his feet.

Result? We’re back to square one, but with a more level playing field. The risk to Obama will be rising and the debt ceiling will be looming. Most important of all, however, Republicans will still be in possession of their unity, their self-respect — and their trousers.

The White House will still try to blame the GOP for the economic consequences. But plenty of Democrats are already on the record arguing that going off the fiscal cliff isn’t the end of the world. If Republicans can somehow pull a better deal out of it, that could be the best of a lot of bad options.

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Is the GOP Digital Team (Still) in Denial?

In this month’s issue of COMMENTARY, Benjamin Domenech has an excellent article on the Republicans’ broken technological machine. In it he explains why the Romney digital team was unable to catch up to Obama’s record-setting digital team that many have likened to “Big Brother” in its scope.

Domenech contends, and I agree, that even taking the strength of Obama’s digital team into account, the Romney campaign didn’t scratch the surface of what they should have accomplished on the digital front. The issues of the Romney campaign were varied and are not only due to the failure of Project Orca. Domenech explains:

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In this month’s issue of COMMENTARY, Benjamin Domenech has an excellent article on the Republicans’ broken technological machine. In it he explains why the Romney digital team was unable to catch up to Obama’s record-setting digital team that many have likened to “Big Brother” in its scope.

Domenech contends, and I agree, that even taking the strength of Obama’s digital team into account, the Romney campaign didn’t scratch the surface of what they should have accomplished on the digital front. The issues of the Romney campaign were varied and are not only due to the failure of Project Orca. Domenech explains:

While digital efforts were the primary focus of the Obama campaign from the beginning, with data miners and tech gurus culled from Silicon Valley, they were a relatively late addition to the Romney effort. Its digital operation was staffed after the rest of the campaign, with an operation that seemed remarkably inefficient for a campaign that was supposed to do things with the rigor of Romney’s research-intensive firm, Bain Capital. There were plenty of people working on the digital side, but tasks were poorly assigned and hampered by restrictive approval processes. Romney’s staff was politically diverse and more used to the world of business than politics—some had never worked on a political campaign before. Frustration set in, then boredom, then Facebook-browsing. The quiet was deafening.

For digital staffers who recognized they were playing catch-up with the Obama machine that had never stopped building after 2008, the contrasts were infuriating. Where the Obama campaign’s content and emails were tailored to the interests of individually targeted demographic communities based on topics of interest and other data-mined priorities, Romney’s campaign didn’t even make distinctions between whether someone had given $5 or $500, or whether the name came to the database through a petition about health care or energy policy.

The campaign was also fiercely hierarchical, to the surprise of some longtime Romney staffers who found their ideas for innovation shunted aside by senior staff and consultants who were unapproachable and unresponsive.

Late last month RedState’s Erick Erickson had a stinging post on the incestuous and unproductive relationship between consultants and the Romney campaign, contending that a group of consultants were “the seeds of Mitt Romney’s ruin and the RNC’s get out the vote (GOTV) effort collapsed — bled to death by charlatan consultants making millions off the party, its donors, and the grassroots.” Unfortunately, with a few exceptions, it appears that his advice on the usefulness of these consultants has more or less fallen on deaf ears. 

Yesterday a “private” meeting (which was immediately reported on by sources present) took place between some members of Romney’s digital team and other major conservative digital strategists. It appears that many found it to be a positive and uplifting experience, and that discussing the enormous gap between the two sides didn’t overwhelm or discourage those present. Roll Call reported that “One source said the meeting was so positive that it was almost as if Romney had won.”

That attitude calls to mind the overconfidence that marked most of the Romney campaign, especially after the first debate. In Domenech’s piece he quotes Romney pollster Neil Newhouse, who announced boldly in a staff meeting, “We’re f—ing gonna win this thing.” The digital divide between the two sides is not insurmountable, but it should not be filling anyone in the conservative movement with anything resembling confidence either. The fact that this meeting left many leaving feeling positive is a worrisome indication that the consultants and strategists who underestimated their ability to compete with the Obama campaign are still living in an alternate reality. 

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Barack Obama as Captain Ahab

One of the things that has become apparent during the presidential campaign and now, during the negotiations over how to avoid the “fiscal cliff,” is the importance the president places on raising the rates on the top 2 percent of income earners. I’ve written before on why I believe conservatives shouldn’t make a “no new taxes” pledge and why keeping the top rate at 35 percent (which I support) isn’t a matter of high principle.

At the same time, Speaker John Boehner and House Republicans–who after all have been willing to put $800 billion in revenues (through closing loopholes and deductions) on the table–have been far more open to compromise than President Obama, who has not given an inch. In particular, the president has made it clear that he would gladly go over the fiscal cliff rather than give up on his obsession to raise tax rates on the top 2 percent.

For Obama, the top two percent are the Great White Whale–and he is Captain Ahab.

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One of the things that has become apparent during the presidential campaign and now, during the negotiations over how to avoid the “fiscal cliff,” is the importance the president places on raising the rates on the top 2 percent of income earners. I’ve written before on why I believe conservatives shouldn’t make a “no new taxes” pledge and why keeping the top rate at 35 percent (which I support) isn’t a matter of high principle.

At the same time, Speaker John Boehner and House Republicans–who after all have been willing to put $800 billion in revenues (through closing loopholes and deductions) on the table–have been far more open to compromise than President Obama, who has not given an inch. In particular, the president has made it clear that he would gladly go over the fiscal cliff rather than give up on his obsession to raise tax rates on the top 2 percent.

For Obama, the top two percent are the Great White Whale–and he is Captain Ahab.

The question is why. Captain Ahab’s neurotic obsession was understandable (Moby Dick, after all, had destroyed his boat and bit off his leg). So what explains Mr. Obama’s obsession?

It can’t be what he claims, which is improving the economy or reducing the deficit. As Charles Krauthammer pointed out, “the alleged curative effect on debt of Obama’s tax-rate demand — the full rate hike on the ‘rich’ would have reduced the 2012 deficit from $1.10 trillion to $1.02 trillion. That’s a joke, a rounding error.”

So if what is driving Obama isn’t an economic argument, what else might it be? Part of it is, as Krauthammer argues, political. Mr. Obama believes forcing Republicans to agree to raise tax rates on the top bracket will fracture the party. But there may be something else at play as well. Barack Obama is a man of the left, a proud progressive, and what animates the left today isn’t a positive vision to achieve the common good; it’s a seething resentment toward those who are successful and a commitment to make them pay more in the name of “fairness.”

To understand the president’s worldview, it’s worth recalling some of the most revealing statements he’s made over the last four years. The first is his response to Charles Gibson during a 2008 debate with Hillary Clinton, when Obama said he would favor raising capital-gains taxes in the name of fairness–even if doing so would create a net revenue loss. The second was Obama’s comments to Joe Wurzelbacher, also made in 2008, that “when you spread the wealth around, it’s good for everybody.” And the third took place in 2012 when the president said, “If you’ve got a business — you didn’t build that.  Somebody else made that happen.”

Mr. Obama’s aim when it comes to taxes, then, isn’t, as he and other liberals often argue, simply to raise revenues. Rather, it is to advance their understanding of “fairness,” which they take to be synonymous with justice, both taken to mean that the top earners in America, at every given moment in time, aren’t sacrificing enough in the form of higher taxes. They should always pay more.

If there were no political or institutional checks on Obama, I’m quick sure he’d tax the top 2 percent at a much higher rate than he’s arguing for now (39.6 percent). But just like he was willing to jettison his commitment to the single-payer system (which in the past he has admitted he prefers) in order to pass the Affordable Care Act, Mr. Obama is a patient ideologue. He is willing to take what he can get now in order to continue his transformational project for America. Part of that transformational project is going after “the rich.” It has become, for him, something of an obsession.

The president may win this particular battle. But if he does, his compulsion won’t end. For ideologues, for the Captain Ahabs of the world, it never really does.

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Liberals and the Federal Favor Trap

Many conservatives have a conflicted attitude toward Jon Stewart. He can be clever, and he sometimes trains his sights on Democratic foibles, but for the most part the ridicule on his show is aimed at conservatives in public life. But Stewart’s transformation over the years into a hectoring, standard-issue liberal means his monologues and interviews often demonstrate clearly and pithily what conservatives don’t like about the big-government left.

And he did so last night, in his extended interview with New Jersey Governor Chris Christie. Stewart, ever in search of Republican hypocrisy, tried to tag Christie with the label because Christie accepted federal disaster relief funds after Hurricane Sandy but balked at setting up a state Obamacare exchange. This is how the conversation went:

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Many conservatives have a conflicted attitude toward Jon Stewart. He can be clever, and he sometimes trains his sights on Democratic foibles, but for the most part the ridicule on his show is aimed at conservatives in public life. But Stewart’s transformation over the years into a hectoring, standard-issue liberal means his monologues and interviews often demonstrate clearly and pithily what conservatives don’t like about the big-government left.

And he did so last night, in his extended interview with New Jersey Governor Chris Christie. Stewart, ever in search of Republican hypocrisy, tried to tag Christie with the label because Christie accepted federal disaster relief funds after Hurricane Sandy but balked at setting up a state Obamacare exchange. This is how the conversation went:

Stewart: So New Jersey is in trouble, and it needs the federal government to step in. And you go to them and you say I need this amount of money. And there’s some horse-trading. But for the most part, they’re going to deliver at least $30 billion to the state of New Jersey, wouldn’t you say? Or maybe even a little more?

Christie: I’m hopeful.

Stewart: At the same time, they want to set up exchanges for health insurance in New Jersey, and you don’t want to do that.

Christie: Well, I don’t want to do it right now.

Stewart: When they’re doing it.

Christie: Well, no. Here’s the issue, Jon, and why I vetoed it. I’m asking them a bunch of questions about how much this is going to cost and everything else, and they won’t answer my questions.

They argued for a bit about whether the Obama administration was being forthcoming enough, and how much money it would ultimately cost New Jersey to set up the exchange. Here is Stewart’s response:

Stewart: So my point to you is, but when you need it for hurricane relief, they don’t come to you and say: But wait a minute, how exactly is this going to go? What is the money going to go for? How are you going to spend it?

Christie: Sure they do.

Forget for a moment that Stewart was wrong, as Christie pointed out, and just peer into the mind of a contemporary liberal. Sure, the government will be happy to help the stranded, the people who just lost everything in a natural disaster, the people with nowhere to go. But first, says the liberal, don’t you think you should do something for the president?

Everything comes with strings attached, even in the case of a natural disaster. Christie pointed out that not setting up a state health-care exchange doesn’t prevent people from getting insurance through the federal exchange the government would set up instead. And he reminded Stewart that when other hurricanes and natural disasters hit around the country, the federal help to those states was paid for in part through New Jersey taxpayer dollars, so this is hardly a case of the victims being greedy.

Later on in the interview, the two came back to this subject. Stewart said he thinks Republicans don’t want the government to do anything unless they themselves need it, in which case their needs rise above those of others. Here’s the example Stewart puts forth to make his stand:

Stewart: For instance, two wars that were not paid for with tax cuts and all those things, yet God forbid a woman wants birth control paid for on her health-care plan, that’s government waste. Not everybody believes that their tax dollars are being paid correctly, but we live in a society.

Christie: But now what prevents us though, and what’s destructive about having a debate about that?

Christie’s answer was appropriate: Welcome, Jon Stewart, to a democracy. But notice Stewart’s logic: If fighting a war to defend the United States is the government’s responsibility, then so is taxpayer-funded birth control. If government’s job is to do anything, then its job is to do everything. And when the government helps its citizens, it expects that favor to be returned.

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Right-to-Work Law Advances in Michigan

Bills that would make Michigan the 24th state to adopt a right-to-work law have passed the Michigan Senate and House, both in Republican hands. If the bills are reconciled, as seems likely, the legislation will be signed by the Republican governor.

This is a remarkable event. Michigan is the fifth-most unionized state in the country, with 19.2 percent of the workforce. The United Auto Workers, born in Michigan, has been a major player in state politics for decades.

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Bills that would make Michigan the 24th state to adopt a right-to-work law have passed the Michigan Senate and House, both in Republican hands. If the bills are reconciled, as seems likely, the legislation will be signed by the Republican governor.

This is a remarkable event. Michigan is the fifth-most unionized state in the country, with 19.2 percent of the workforce. The United Auto Workers, born in Michigan, has been a major player in state politics for decades.

But the Michigan economy is doing very poorly, relative to the country as a whole, with unemployment at 9.1 percent. Only five states are doing worse. The state’s biggest city, Detroit, is a poster child for urban decay, on the brink of bankruptcy thanks to decades of spectacularly corrupt government and unaffordable pension agreements with its unionized workers.

Right-to-work states have been overwhelmingly concentrated in the South, the mountain West, and the northern plain states. But this year Indiana became the first state in the Midwest industrial heartland to adopt a right-to-work law. Should Michigan do so as well, it will be a powerful indication that union power is in serious and probably permanent decline. No longer obliged to belong to a union in order to work at a unionized company or government, many workers will simply stop paying the substantial dues unions charge. And since, as California’s Jesse Unruh explained decades ago, “money is the mother’s milk of politics,” that means union political power will diminish accordingly.

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The Jobs Report

The unemployment rate fell to 7.7 percent from 7.9 in October, and 146,000 jobs were added to the economy. But the first number is from the Household Survey data and the second from the Establishment Survey data. As usual in this economy, the two surveys tell different stories.

According to the Household Survey, the number of unemployed remained about the same, at 12 million, and long-term unemployed made up 40.1 percent of total unemployed, both dismal numbers. Equally dismal was the number of underemployed, working part-time jobs but wanting full-time work, at 8.2 million.

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The unemployment rate fell to 7.7 percent from 7.9 in October, and 146,000 jobs were added to the economy. But the first number is from the Household Survey data and the second from the Establishment Survey data. As usual in this economy, the two surveys tell different stories.

According to the Household Survey, the number of unemployed remained about the same, at 12 million, and long-term unemployed made up 40.1 percent of total unemployed, both dismal numbers. Equally dismal was the number of underemployed, working part-time jobs but wanting full-time work, at 8.2 million.

Again the participation rate (the percentage of working-age adults in the labor force) declined, to 63.6 percent, accounting for most of the decline in the unemployment number. The baby boomers retiring at the rate of 10,000 a day is the only thing that is keeping the numbers from being even more dismal than they are.

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