Commentary Magazine


Topic: Senate Finance Committee

Another Strategy in the War on Free Speech

The war on free speech has taken an ominous turn. It was bad enough when campaign finance “reformers” were imploring the Congress and courts to stifle core political speech. But now they’ve adopted a new tactic:

Since the Supreme Court’s January decision in Citizens United v. FEC, Democrats in Congress have been trying to pass legislation to repeal the First Amendment for business, though not for unions. Having failed on that score, they’re now turning to legal and political threats. Funny how all of this outrage never surfaced when the likes of Peter Lewis of Progressive insurance and George Soros helped to make Democrats financially dominant in 2006 and 2008.

Chairman Max Baucus of the powerful Senate Finance Committee got the threats going last month when he asked Internal Revenue Service Commissioner Douglas Shulman to investigate if certain tax exempt 501(c) groups had violated the law by engaging in too much political campaign activity. Lest there be any confusion about his targets, the Montana Democrat flagged articles focused on GOP-leaning groups, including Americans for Job Security and American Crossroads.

Not since Richard Nixon has the IRS been employed to target political enemies. Where does the IRS commissioner stand on this? Is he going to take auditing directions from politicians seeking partisan advantage? It would be appropriate when Congress convenes in January for the new GOP chairmen to conduct some hearings and make sure the IRS isn’t going to allow itself to be used in this fashion. The surest way, however, to prevent that is for Democratic pols to cease using the tax authority to intimidate and attack their political opponents.

The war on free speech has taken an ominous turn. It was bad enough when campaign finance “reformers” were imploring the Congress and courts to stifle core political speech. But now they’ve adopted a new tactic:

Since the Supreme Court’s January decision in Citizens United v. FEC, Democrats in Congress have been trying to pass legislation to repeal the First Amendment for business, though not for unions. Having failed on that score, they’re now turning to legal and political threats. Funny how all of this outrage never surfaced when the likes of Peter Lewis of Progressive insurance and George Soros helped to make Democrats financially dominant in 2006 and 2008.

Chairman Max Baucus of the powerful Senate Finance Committee got the threats going last month when he asked Internal Revenue Service Commissioner Douglas Shulman to investigate if certain tax exempt 501(c) groups had violated the law by engaging in too much political campaign activity. Lest there be any confusion about his targets, the Montana Democrat flagged articles focused on GOP-leaning groups, including Americans for Job Security and American Crossroads.

Not since Richard Nixon has the IRS been employed to target political enemies. Where does the IRS commissioner stand on this? Is he going to take auditing directions from politicians seeking partisan advantage? It would be appropriate when Congress convenes in January for the new GOP chairmen to conduct some hearings and make sure the IRS isn’t going to allow itself to be used in this fashion. The surest way, however, to prevent that is for Democratic pols to cease using the tax authority to intimidate and attack their political opponents.

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Robert Gibbs at It Again

One way in which press secretary Robert Gibbs resembles his boss, the president, is that the weaker the case they have, the more petulant and smug they both become. We saw that behavior play out again yesterday, when Gibbs was asked about the recess appointment of Donald Berwick to head the Centers for Medicare and Medicaid Services, which oversees approximately one third of all health-care spending in the United States.

Dr. Berwick is controversial because he has spoken as a besotted lover of the British health-care system. “I am romantic about the National Health Service,” he said in 2008, referring to the British single-payer system. “I love it.” Dr. Berwick went on to call it “such a seductress” and “a global treasure.” On rationing care, Dr. Berwick said that, “The decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open.” He has argued that one of “the primary functions” of health regulation is “to constrain decentralized, individual decision making” and “to weigh public welfare against the choices of private consumers.” And Dr. Berwick insists that, “any health-care funding plan that is just, equitable, civilized and humane must — must — redistribute wealth from the richer among us to the poorer and less fortunate.” (For a fuller examination of Dr. Berwick’s views, see this and this.)

Now, it may be that Dr. Berwick’s views are reasonable and defensible. It may be that his quotes have been taken out of context. It may even be that Dr. Berwick is the perfect person for this job. That is what hearings are meant to determine. Yet the hearings have been bypassed.

White House communications director Dan Pfeiffer blamed Republicans. “Republicans in Congress have made it clear in recent weeks that they were going to stall the nomination as long as they could, solely to score political points,” Pfeiffer said. “But with the agency facing new responsibilities to protect seniors’ care under the Affordable Care Act, there’s no time to waste with Washington game-playing.”

Like so much of what the Obama administration says, this charge is flat out false. It is not the GOP that is playing games but rather the White House. As ABC’s Jake Tapper reported last week:

Republicans were not delaying or stalling Berwick’s nomination. Indeed, they were eager for his hearing, hoping to assail Berwick’s past statements about health-care rationing and his praise for the British health care system. … speaking not for attribution, Democratic officials say that neither Senate Majority Leader Harry Reid, D-Nev., nor Sen. Max Baucus, D-Mont., the chair of the Senate Finance Committee, were eager for an ugly confirmation fight four months before the midterm elections.

Senator Chuck Grassley, the ranking Republican on the Senate Finance Committee, said that, “The nomination hasn’t been held up by Republicans in Congress and to say otherwise is misleading.” He said he requested that a hearing take place weeks ago, before this recess.

It’s obvious what’s going on here. The Obama administration is afraid to engage in another debate about ObamaCare, having been trounced in the past. The president’s team fears that Dr. Berwick’s comments are both too controversial and too revealing. So Obama decided to skip the nomination hearing. The administration, unable to defend its actions, offers up — in the person of Robert Gibbs — a testy and transparently silly explanation of its position. What Gibbs cannot answer is this: If Dr. Berwick is so qualified, why not have the hearing and, if Republicans in fact attempt to block his nomination, recess appoint him in August? Why not allow Dr. Berwick to explain, in a public setting, what his true views are?

Gibbs, unable to provide a reasonable response to these questions, reverts to behavior that seems to be a second nature to him: condescension, mockery, brittleness. And, of course, he must reach for the requisite straw man (in this instance, portraying his critics as involved in a conspiracy theory).

I imagine there have been more off-putting press secretaries than Mr. Gibbs. I just can’t think of who they might be.

One way in which press secretary Robert Gibbs resembles his boss, the president, is that the weaker the case they have, the more petulant and smug they both become. We saw that behavior play out again yesterday, when Gibbs was asked about the recess appointment of Donald Berwick to head the Centers for Medicare and Medicaid Services, which oversees approximately one third of all health-care spending in the United States.

Dr. Berwick is controversial because he has spoken as a besotted lover of the British health-care system. “I am romantic about the National Health Service,” he said in 2008, referring to the British single-payer system. “I love it.” Dr. Berwick went on to call it “such a seductress” and “a global treasure.” On rationing care, Dr. Berwick said that, “The decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open.” He has argued that one of “the primary functions” of health regulation is “to constrain decentralized, individual decision making” and “to weigh public welfare against the choices of private consumers.” And Dr. Berwick insists that, “any health-care funding plan that is just, equitable, civilized and humane must — must — redistribute wealth from the richer among us to the poorer and less fortunate.” (For a fuller examination of Dr. Berwick’s views, see this and this.)

Now, it may be that Dr. Berwick’s views are reasonable and defensible. It may be that his quotes have been taken out of context. It may even be that Dr. Berwick is the perfect person for this job. That is what hearings are meant to determine. Yet the hearings have been bypassed.

White House communications director Dan Pfeiffer blamed Republicans. “Republicans in Congress have made it clear in recent weeks that they were going to stall the nomination as long as they could, solely to score political points,” Pfeiffer said. “But with the agency facing new responsibilities to protect seniors’ care under the Affordable Care Act, there’s no time to waste with Washington game-playing.”

Like so much of what the Obama administration says, this charge is flat out false. It is not the GOP that is playing games but rather the White House. As ABC’s Jake Tapper reported last week:

Republicans were not delaying or stalling Berwick’s nomination. Indeed, they were eager for his hearing, hoping to assail Berwick’s past statements about health-care rationing and his praise for the British health care system. … speaking not for attribution, Democratic officials say that neither Senate Majority Leader Harry Reid, D-Nev., nor Sen. Max Baucus, D-Mont., the chair of the Senate Finance Committee, were eager for an ugly confirmation fight four months before the midterm elections.

Senator Chuck Grassley, the ranking Republican on the Senate Finance Committee, said that, “The nomination hasn’t been held up by Republicans in Congress and to say otherwise is misleading.” He said he requested that a hearing take place weeks ago, before this recess.

It’s obvious what’s going on here. The Obama administration is afraid to engage in another debate about ObamaCare, having been trounced in the past. The president’s team fears that Dr. Berwick’s comments are both too controversial and too revealing. So Obama decided to skip the nomination hearing. The administration, unable to defend its actions, offers up — in the person of Robert Gibbs — a testy and transparently silly explanation of its position. What Gibbs cannot answer is this: If Dr. Berwick is so qualified, why not have the hearing and, if Republicans in fact attempt to block his nomination, recess appoint him in August? Why not allow Dr. Berwick to explain, in a public setting, what his true views are?

Gibbs, unable to provide a reasonable response to these questions, reverts to behavior that seems to be a second nature to him: condescension, mockery, brittleness. And, of course, he must reach for the requisite straw man (in this instance, portraying his critics as involved in a conspiracy theory).

I imagine there have been more off-putting press secretaries than Mr. Gibbs. I just can’t think of who they might be.

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Flotsam and Jetsam

Clark Hoyt’s “attempt to placate the barking cadre of anti-Israel watchdogs” by suggesting that the Gray Lady’s Jerusalem bureau chief be sacked because his son is in the Israeli army comes to naught. Executive editor Bill Keller — yes, a broken clock is right twice a day — says Ethan Bronner can stay put.

Jay Nordlinger reminds us that Sarah Palin is one of the few politicians to say she “loves” Israel.

Sounds like a joke: the Obami’s terrorism policies are so untenable, even MSNBC reporters don’t buy the White House spin any more. But it’s true.

Steven Calabresi is fed up with the excuse-mongering: “The Obama Administration’s claims that ‘Bush did it too’ sound pathetic coming from a President who won election by promising to be an agent of change and hope who would alter our politics and the way things are done in Washington. … Is Miranda any less stupid because prior presidents have implemented it rather than pushing the Supreme Court to scrap the decision? The claim that ‘Bush did it too’ sounds uncomfortably like the arguments I get from my grade school children when I correct them for having done something wrong.”

And speaking of change, Bill Kristol writes: “Perhaps embracing the concept of  ‘regime change’ spooks the Obama administration. It’s awfully reminiscent of George W. Bush. But one great failure of the Bush administration was its second-term fecklessness with respect to Iran. Bush kicked the Iran can down the road. Does Obama want an achievement that eluded Bush? Regime change in Iran — that would be an Obama administration achievement that Joe Biden, and the rest of us, could really celebrate.”

Andy McCarthy explains why the Richard Reid case is a poor example for the Obami to cite in justifying its criminal-justice approach to terrorism. “When Reid tried to blow up his airliner, 9/11 had just happened. We had not spent eight years grappling with the question of how international terrorists who carry out attacks in the United States should be dealt with. It is important to remember that there was no military-commission system in place when Reid was captured. President Bush had issued the executive order authorizing the Defense Department to set up the system, but that had not been done yet. It wasn’t ready until March 2002.”

What a difference a year makes: “After miserable House elections in ’06 and ’08 saw the GOP virtually disappear in the northeast, it was hard not to write the party’s obituary in the region. No GOPers were left standing in New England, and just 3 remained in the 29-member NY delegation. It only worsened in ’09, when the GOP failed to hold a rural sprawling CD in upstate NY, dropping its representation in the state to just 2 members. But evidence suggests that the ’10 wave that’s building for the GOP could even manage to reach the untouchable Northeast.” Democrats Tim Bishop in Suffolk County and  Bill Delahunt in Massachusetts look especially vulnerable.

More than 50 percent of independents disapprove of Obama’s performance.

What would Republicans do without opponents like this? “Senate Majority Leader Harry Reid (D-Nev.) is rewriting a jobs bill after Democrats complained of too many concessions to Republicans. Reid announced Thursday that he would cut back on the jobs bill Senate Finance Committee Chairman Max Baucus (D-Mont.) introduced only hours earlier, essentially overruling the powerful chairman.”

Maybe outsiders did bump off an Iranian nuclear scientist.

Clark Hoyt’s “attempt to placate the barking cadre of anti-Israel watchdogs” by suggesting that the Gray Lady’s Jerusalem bureau chief be sacked because his son is in the Israeli army comes to naught. Executive editor Bill Keller — yes, a broken clock is right twice a day — says Ethan Bronner can stay put.

Jay Nordlinger reminds us that Sarah Palin is one of the few politicians to say she “loves” Israel.

Sounds like a joke: the Obami’s terrorism policies are so untenable, even MSNBC reporters don’t buy the White House spin any more. But it’s true.

Steven Calabresi is fed up with the excuse-mongering: “The Obama Administration’s claims that ‘Bush did it too’ sound pathetic coming from a President who won election by promising to be an agent of change and hope who would alter our politics and the way things are done in Washington. … Is Miranda any less stupid because prior presidents have implemented it rather than pushing the Supreme Court to scrap the decision? The claim that ‘Bush did it too’ sounds uncomfortably like the arguments I get from my grade school children when I correct them for having done something wrong.”

And speaking of change, Bill Kristol writes: “Perhaps embracing the concept of  ‘regime change’ spooks the Obama administration. It’s awfully reminiscent of George W. Bush. But one great failure of the Bush administration was its second-term fecklessness with respect to Iran. Bush kicked the Iran can down the road. Does Obama want an achievement that eluded Bush? Regime change in Iran — that would be an Obama administration achievement that Joe Biden, and the rest of us, could really celebrate.”

Andy McCarthy explains why the Richard Reid case is a poor example for the Obami to cite in justifying its criminal-justice approach to terrorism. “When Reid tried to blow up his airliner, 9/11 had just happened. We had not spent eight years grappling with the question of how international terrorists who carry out attacks in the United States should be dealt with. It is important to remember that there was no military-commission system in place when Reid was captured. President Bush had issued the executive order authorizing the Defense Department to set up the system, but that had not been done yet. It wasn’t ready until March 2002.”

What a difference a year makes: “After miserable House elections in ’06 and ’08 saw the GOP virtually disappear in the northeast, it was hard not to write the party’s obituary in the region. No GOPers were left standing in New England, and just 3 remained in the 29-member NY delegation. It only worsened in ’09, when the GOP failed to hold a rural sprawling CD in upstate NY, dropping its representation in the state to just 2 members. But evidence suggests that the ’10 wave that’s building for the GOP could even manage to reach the untouchable Northeast.” Democrats Tim Bishop in Suffolk County and  Bill Delahunt in Massachusetts look especially vulnerable.

More than 50 percent of independents disapprove of Obama’s performance.

What would Republicans do without opponents like this? “Senate Majority Leader Harry Reid (D-Nev.) is rewriting a jobs bill after Democrats complained of too many concessions to Republicans. Reid announced Thursday that he would cut back on the jobs bill Senate Finance Committee Chairman Max Baucus (D-Mont.) introduced only hours earlier, essentially overruling the powerful chairman.”

Maybe outsiders did bump off an Iranian nuclear scientist.

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Flotsam and Jetsam

ObamaCare is really unpopular in Nebraska, and Sen. Ben Nelson is getting lots of calls to vote “no.” In his home state, 67 percent oppose and 26 percent favor, and 61 percent say they’d be less likely to vote for Nelson if he supported it. Will Nelson vote for it anyway?

Yuval Levin makes the case that “when it comes to the health-care bill the Senate is working on, [which] is really quite appalling now, and should be so not only to conservatives. In essence, what’s left of the bill compels universal participation in a system that everyone agrees is a failure without reforming that system, and even exacerbates its foremost problem — the problem of exploding costs.”

Markos Moulitsas of the Daily Kos (h/t Political Wire) now objects to forcing all Americans to buy insurance plans they may not like from those greedy, monopolistic insurance companies. The solution: “So here’s the deal — a progressive should step up with an amendment to strip out the mandate. He should get a non-Wall Street Republican to join him, be it Tom Coburn or Jim DeMint, one or more of those guys. And then force a roll call vote on the issue.” Game on!

S.E. Cupp on her pick for person of the year: “Attorney General Eric Holder. … In five or ten years, when we are all facing the disastrous consequences of his systematic dismantling of our national security, he will be a person who changed the course of world events. President Obama will be culpable as well, of course, for overseeing a horrific chapter in our national history, but it will be Holder who is responsible for compromising our intelligence and interrogation program at the CIA and trying terrorists as common criminals while the world watched and our enemies laughed.”

Another poll, another thumbs down on ObamaCare. The NBC News/Wall Street Journal survey: 32 percent approve and 47 percent disapprove. By a 44 to 41 percent margin, voters say they prefer the status quo. Obama’s own performance rating has suffered an 8-point decline since September and now is at 47 approval/46 disapproval. And the kicker: 57 percent say the Iraq war was somewhat or very successful.

The poll analysis: ” ‘For Democrats, the red flags are flying at full mast,’ said Democratic pollster Peter Hart, who conducts the survey with Republican pollster Bill McInturff. ‘What we don’t know for certain is: Have we reached a bottoming-out point?’ The biggest worry for Democrats is that the findings could set the stage for gains by Republican candidates in next year’s elections.” And Obama seems to have lost his charm: “Fifty percent now feel positively about him, six points lower than in October and an 18-point drop since his early weeks in office.”

Wait until they find out about the tax hits: “Those tax hits include a mandate of up to $750 a year for Americans who fail to purchase health insurance; new levies on small businesses (many of which file individual tax returns) that don’t offer health care to employees; new tax penalties on health savings accounts and flexible spending accounts; and higher taxes on medical spending, including restrictions on medical itemized deductions, as well as taxes on cosmetic surgery. A Senate Finance Committee minority staff report finds that by 2019 more than 42 million individuals and families—or 25% of all tax returns under $200,000—will on average see their taxes go up because of the Senate bill. And that’s after government subsidies.”

And when they start breaking the Senate rules, you know it’s desperation time.

Jamie Fly is among those who suspect that the administration is not all that enamored of Iran sanctions. “[The] administration’s efforts to gut the legislation and its sensitivity about the supposedly robust international coalition they like to tout as a product of their willingness to talk to Tehran raises questions about how serious they and their ‘partners’ are about stopping Iran’s progress toward a nuclear weapon.”

ObamaCare is really unpopular in Nebraska, and Sen. Ben Nelson is getting lots of calls to vote “no.” In his home state, 67 percent oppose and 26 percent favor, and 61 percent say they’d be less likely to vote for Nelson if he supported it. Will Nelson vote for it anyway?

Yuval Levin makes the case that “when it comes to the health-care bill the Senate is working on, [which] is really quite appalling now, and should be so not only to conservatives. In essence, what’s left of the bill compels universal participation in a system that everyone agrees is a failure without reforming that system, and even exacerbates its foremost problem — the problem of exploding costs.”

Markos Moulitsas of the Daily Kos (h/t Political Wire) now objects to forcing all Americans to buy insurance plans they may not like from those greedy, monopolistic insurance companies. The solution: “So here’s the deal — a progressive should step up with an amendment to strip out the mandate. He should get a non-Wall Street Republican to join him, be it Tom Coburn or Jim DeMint, one or more of those guys. And then force a roll call vote on the issue.” Game on!

S.E. Cupp on her pick for person of the year: “Attorney General Eric Holder. … In five or ten years, when we are all facing the disastrous consequences of his systematic dismantling of our national security, he will be a person who changed the course of world events. President Obama will be culpable as well, of course, for overseeing a horrific chapter in our national history, but it will be Holder who is responsible for compromising our intelligence and interrogation program at the CIA and trying terrorists as common criminals while the world watched and our enemies laughed.”

Another poll, another thumbs down on ObamaCare. The NBC News/Wall Street Journal survey: 32 percent approve and 47 percent disapprove. By a 44 to 41 percent margin, voters say they prefer the status quo. Obama’s own performance rating has suffered an 8-point decline since September and now is at 47 approval/46 disapproval. And the kicker: 57 percent say the Iraq war was somewhat or very successful.

The poll analysis: ” ‘For Democrats, the red flags are flying at full mast,’ said Democratic pollster Peter Hart, who conducts the survey with Republican pollster Bill McInturff. ‘What we don’t know for certain is: Have we reached a bottoming-out point?’ The biggest worry for Democrats is that the findings could set the stage for gains by Republican candidates in next year’s elections.” And Obama seems to have lost his charm: “Fifty percent now feel positively about him, six points lower than in October and an 18-point drop since his early weeks in office.”

Wait until they find out about the tax hits: “Those tax hits include a mandate of up to $750 a year for Americans who fail to purchase health insurance; new levies on small businesses (many of which file individual tax returns) that don’t offer health care to employees; new tax penalties on health savings accounts and flexible spending accounts; and higher taxes on medical spending, including restrictions on medical itemized deductions, as well as taxes on cosmetic surgery. A Senate Finance Committee minority staff report finds that by 2019 more than 42 million individuals and families—or 25% of all tax returns under $200,000—will on average see their taxes go up because of the Senate bill. And that’s after government subsidies.”

And when they start breaking the Senate rules, you know it’s desperation time.

Jamie Fly is among those who suspect that the administration is not all that enamored of Iran sanctions. “[The] administration’s efforts to gut the legislation and its sensitivity about the supposedly robust international coalition they like to tout as a product of their willingness to talk to Tehran raises questions about how serious they and their ‘partners’ are about stopping Iran’s progress toward a nuclear weapon.”

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Taxing Our Patience

The Hill, reminding us that certain senators have promised not to raise taxes, explains just how many taxes there are in the pending health-care bill:

Individuals would face penalties for failing to purchase insurance and those earning more than $200,000 would see their Medicare payroll tax rise from 1.45 percent to 1.95 percent. The payroll tax rise would hit couples earning $250,000 or more.

The measure would also impose a $2 billion annual tax on medical devices such as pacemakers; a broad $6.7 billion annual tax on the health insurance industry; a 5 percent tax on cosmetic surgery; and would eliminate tax deductions for employer-provided prescription drug coverage in retirement.

An analysis by the Joint Committee on Taxation found that in the year 2019, 77 percent of the cost of the tax increases proposed in the Senate Finance Committee’s healthcare bill would be carried by families earning less than $250,000 a year.

There is a total of $494B by some estimation. And, of course, this flies in the face of Obama’s pledge not to raise taxes on those making less than $250,000. Specifically, labor unions aren’t very happy about the tax on so-called Cadillac health-care plans (which were in many collective-bargaining negotiations provided in lieu of higher wages or other benefits): “Labor unions have opposed this tax, which funds a substantial portion of the bill, because they argue that it would hit many unionized, working-class families.”

All this would be bad enough in ordinary times but we are, after all, not yet out of the recession. Can anyone really imagine that hundreds of billions in new taxes are going to help matters? We are continually told that taxes are receding as a top issue. The way to test that proposition is to vote for massive tax hikes, in violation of a specific campaign pledge in the middle of an economic downturn. How many lawmakers will have the nerve to find out?

The Hill, reminding us that certain senators have promised not to raise taxes, explains just how many taxes there are in the pending health-care bill:

Individuals would face penalties for failing to purchase insurance and those earning more than $200,000 would see their Medicare payroll tax rise from 1.45 percent to 1.95 percent. The payroll tax rise would hit couples earning $250,000 or more.

The measure would also impose a $2 billion annual tax on medical devices such as pacemakers; a broad $6.7 billion annual tax on the health insurance industry; a 5 percent tax on cosmetic surgery; and would eliminate tax deductions for employer-provided prescription drug coverage in retirement.

An analysis by the Joint Committee on Taxation found that in the year 2019, 77 percent of the cost of the tax increases proposed in the Senate Finance Committee’s healthcare bill would be carried by families earning less than $250,000 a year.

There is a total of $494B by some estimation. And, of course, this flies in the face of Obama’s pledge not to raise taxes on those making less than $250,000. Specifically, labor unions aren’t very happy about the tax on so-called Cadillac health-care plans (which were in many collective-bargaining negotiations provided in lieu of higher wages or other benefits): “Labor unions have opposed this tax, which funds a substantial portion of the bill, because they argue that it would hit many unionized, working-class families.”

All this would be bad enough in ordinary times but we are, after all, not yet out of the recession. Can anyone really imagine that hundreds of billions in new taxes are going to help matters? We are continually told that taxes are receding as a top issue. The way to test that proposition is to vote for massive tax hikes, in violation of a specific campaign pledge in the middle of an economic downturn. How many lawmakers will have the nerve to find out?

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See What I Mean?

The New York Times this morning has a front-page story on the difficulty of balancing New York State’s budget, which is gushing red ink. The governor, David Paterson, called the legislature into session this week and delivered an address to both houses, asking — begging, really — for serious budget cuts to cover a $3 billion deficit in this year’s budget and far larger deficits in future years.

Good luck with that, governor. As the Times explains:

Gov. David A. Paterson is imploring the Legislature to finally reckon with the state’s ugly financial reality.

But first the governor must reckon with the likes of Senator Carl Kruger.

Mr. Kruger, a Brooklyn Democrat who is the chairman of the Senate Finance Committee, has amassed a campaign war chest of $2.1 million, in part because of generous contributions from his labor union allies.

Despite a deficit of more than $3 billion, Mr. Kruger has threatened to block any significant cuts to health care and education, the biggest spending areas in the budget. He has presented his own budget plan, which has startled even Albany veterans for its reliance on one-time maneuvers and financial gimmickry.

Last week, the state’s most powerful union, 1199 SEIU United Healthcare Workers East, had a rally in Albany, with 2,000 people screaming for no cuts. The SEIU and other public-service unions don’t hesitate to launch aggressive TV-advertising campaigns against politicians who do not toe the union line, while donating generously to the campaign war chests of those who do, such as Senator Kruger. The taxpayers have no means to push back, since the legislature is thoroughly gerrymandered. As a result, politicians take the path of least resistance: like Kruger, they prefer to use creative accounting to get around the state constitution’s requirement that the expense budget be balanced, rather than face fiscal reality. This, of course, simply makes the problem worse in the future, as more and more of today’s budget is funded with tomorrow’s money.

The Times has finally woken up to the fact that gerrymandering is an affront to the very principle of democratic government. And unless it and the rest of the New York media world finally acknowledge that allowing politicians to keep the state’s books as they please guarantees gimmickry instead of hard choices, disaster is inevitable. Like every corporation in the country, governments need the discipline that comes from having to adhere to rigorous accounting principles, and relying on independent accountants to ensure that they do.

The New York Times this morning has a front-page story on the difficulty of balancing New York State’s budget, which is gushing red ink. The governor, David Paterson, called the legislature into session this week and delivered an address to both houses, asking — begging, really — for serious budget cuts to cover a $3 billion deficit in this year’s budget and far larger deficits in future years.

Good luck with that, governor. As the Times explains:

Gov. David A. Paterson is imploring the Legislature to finally reckon with the state’s ugly financial reality.

But first the governor must reckon with the likes of Senator Carl Kruger.

Mr. Kruger, a Brooklyn Democrat who is the chairman of the Senate Finance Committee, has amassed a campaign war chest of $2.1 million, in part because of generous contributions from his labor union allies.

Despite a deficit of more than $3 billion, Mr. Kruger has threatened to block any significant cuts to health care and education, the biggest spending areas in the budget. He has presented his own budget plan, which has startled even Albany veterans for its reliance on one-time maneuvers and financial gimmickry.

Last week, the state’s most powerful union, 1199 SEIU United Healthcare Workers East, had a rally in Albany, with 2,000 people screaming for no cuts. The SEIU and other public-service unions don’t hesitate to launch aggressive TV-advertising campaigns against politicians who do not toe the union line, while donating generously to the campaign war chests of those who do, such as Senator Kruger. The taxpayers have no means to push back, since the legislature is thoroughly gerrymandered. As a result, politicians take the path of least resistance: like Kruger, they prefer to use creative accounting to get around the state constitution’s requirement that the expense budget be balanced, rather than face fiscal reality. This, of course, simply makes the problem worse in the future, as more and more of today’s budget is funded with tomorrow’s money.

The Times has finally woken up to the fact that gerrymandering is an affront to the very principle of democratic government. And unless it and the rest of the New York media world finally acknowledge that allowing politicians to keep the state’s books as they please guarantees gimmickry instead of hard choices, disaster is inevitable. Like every corporation in the country, governments need the discipline that comes from having to adhere to rigorous accounting principles, and relying on independent accountants to ensure that they do.

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The (Moderately) Rich Get Richer

Harvard’s financial aid “reforms,” announced Monday, are great news for anyone who thinks that what Harvard needs is not a revived core curriculum, but more students from the upper class. Under Harvard’s new policy, families with incomes between $60,000 and $180,000 will have to pay no more than 10 percent of their incomes in tuition. Since the 2006 median income in the U.S. was about $48,000, the benefits of these “reforms” will go to the rich.

Yes, $180,000 isn’t as much as it seems if you live in New York City. But Harvard already has lots of kids from New York City: that’s not the kind of diversity it’s lacking. And yes, Harvard is “need-blind,” and it gives generous support to students from families below the median. But there are only so many spots to go around. Making it easier for the rich to accept an offer from Harvard will increase their matriculation rate. To compensate, Harvard will have to make fewer offers to the poor.

By coincidence, Harvard’s announcement came less than three months after the Senate Finance Committee expressed interest in forcing large university endowments to pay out 5 percent per year. But then the entire question of financial aid at Harvard (and Yale) is a farce: it would cost only $238 million—about 1 percent of an endowment that gained $5 billion in fiscal 2007—to pay tuition, room, and board for all Yale College students this year. Financial aid is about increasing the size of the applicant pool so you can turn more of them down, and win the prestige that comes with enhanced selectivity.

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Harvard’s financial aid “reforms,” announced Monday, are great news for anyone who thinks that what Harvard needs is not a revived core curriculum, but more students from the upper class. Under Harvard’s new policy, families with incomes between $60,000 and $180,000 will have to pay no more than 10 percent of their incomes in tuition. Since the 2006 median income in the U.S. was about $48,000, the benefits of these “reforms” will go to the rich.

Yes, $180,000 isn’t as much as it seems if you live in New York City. But Harvard already has lots of kids from New York City: that’s not the kind of diversity it’s lacking. And yes, Harvard is “need-blind,” and it gives generous support to students from families below the median. But there are only so many spots to go around. Making it easier for the rich to accept an offer from Harvard will increase their matriculation rate. To compensate, Harvard will have to make fewer offers to the poor.

By coincidence, Harvard’s announcement came less than three months after the Senate Finance Committee expressed interest in forcing large university endowments to pay out 5 percent per year. But then the entire question of financial aid at Harvard (and Yale) is a farce: it would cost only $238 million—about 1 percent of an endowment that gained $5 billion in fiscal 2007—to pay tuition, room, and board for all Yale College students this year. Financial aid is about increasing the size of the applicant pool so you can turn more of them down, and win the prestige that comes with enhanced selectivity.

By design, what stops students from attending Harvard isn’t the cost: it’s Harvard’s Admissions Office, which, like Yale’s, turns down nine out of ten applicants. And here those on the fringes of the system—which is not quite the same thing as being poor—are at a serious disadvantage, because simply being smart is not enough to get in. You need to demonstrate your social conscience, and to develop as many weird interests as possible. The latest fad, Alex Williams reported in the New York Times over the weekend, is squash, which, as one parent put it, “just helps your admissions chances.”

The last thing the Senate should do is to try to fix Harvard: the unintended consequences are bound to be catastrophic. But Harvard’s “reforms,” and its admissions policies, are of a piece with our national obsession: helping the well-off. From preserving Social Security, which transfers wealth from the young to the old; to expanding SCHIP into the upper-middle class by raising taxes on tobacco, a vice of the poor; to providing relief for homeowners who sought out the loans that got them into the subprime mortgage “crisis,” the Left (and all too frequently the Right) panders to the rich while arguing that what it seeks is social justice for the poor.

There are lots of good arguments for small government. But the best one is that the bigger government gets, the more favors it does for the elite, and the more harm it does to the American promise of opportunity and equal treatment under law. In a recent opinion, Chief Justice Roberts wrote that “The way to stop discrimination on the basis of race is to stop discriminating on the basis of race.” Like the rest of us, Harvard needs to remember that the best way to help the poor is to stop helping the rich.




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