Steve Israel…doesn’t get it

In response to his party’s caucus shrinking to its lowest number in over 80 year, Rep. Steve Israel (D-NY, outgoing Congressional Campaign Chair) revealed a tone-deafness that, if shared by the rest of his caucus, could lead to even further shrinking.

Israel parroted the usual line we hear on the left these days – that the winning Republicans should “come into the middle” and work with Democrats (NROThe Corner), never mind that if voters had wanted Congress to be more amenable to Democrats’ wishes, they would have elected more actual Democrats.

Where Israel really goes off the rails is his insistence that the lame-duck Congress short-circuit the election (which at least in Louisiana is still ongoing) on “immigration reform” (same link):

Israel brought up corporate tax changes and, pointedly, immigration reform as issues on which the two parties can compromise.

“There really shouldn’t be any paralysis on this,” he said, noting that a Senate immigration bill has passed. “Let’s just pass it in the House,” he urged.

Let’s unpack this ass-hattery slowly.

First of all, there are good reasons why someone on either side of the argument on illegal immigration would have serious problems with the Senate’s immigration bill, chief among them the horrendous economic assumptions that “justify” it.  More to the point, a lame-duck session of Congress passing that bill would be a complete insult to the voters.

Lest we forget, John Boehner’s refusal to bring up the Senate immigration bill for a vote was one of the chief complaints thrown at him by the president, Senate Democrats, and just about everyone to the left of center in America. They hoped voters would send Boehner a message. Instead, voters sent him reinforcements.

Mitch McConnell was one of the 32 Senators who opposed the bill. Voters sent him reinforcements, too – eight so far, with perhaps one more coming in Louisiana.

Finally, of the 68 Senators who voted in favor of S.744, 5 Democrats lost their seats to Republicans (with one more, Mary Landrieu, likely to suffer the same fate), 4 have retired (3 of them Democrats to be replaced by Republicans), and one – Marco Rubio – has repudiated his vote. Even assuming no one else would vote differently (highly unlikely, especially given that McConnell will be more accommodating of amendments as Majority Leader), the bill could easily fail a cloture vote in the 2015 Senate. Whatever the voters of 2014 wanted, it sure wasn’t the Senate’s immigration bill.

Then again, Israel is trying to close his eyes to the voters anyway (same link again):

“In this election, one-third of voters chose a Democrat or Republican,” Israel said. “The other two-thirds just want us to get things done.”

Um…with all due respect, Steve, you don’t know what the other two-thirds want because they didn’t bother to vote.

If Israel (and the president) are any indication, the Democrats have decided that the non-voter is their perfect blank slate, upon which they can force any assumption and in whose they can put whatever words they like. That is a surefire recipe for a Republican president the next time actual voters get their say.

Cross-posted to the right-wing liberal

Tax issue helped Republicans expand the wave election (too bad Virginia Republicans took it away from Gillespie)

Disaffection with the president was a major driver for Republican success in last night’s election – of that there is no doubt. That said, the extent of success was greatly helped by…wait for it…taxes.

We begin with the epicenter of the tax argument: Kansas. Governor Sam Brownback’s tax reduction were supposed to be his own worst enemy – a political millstone that might not only drag him down, but Senator Pat Roberts, too. Instead, Roberts won going away, and Brownback not only won re-election, but came within 100 votes of an absolute majority (a Libertarian nominee took 4% of the vote). AP (via the Lawrence Journal-World), explains why in their exit poll analysis:

TAX CUTS: Roughly half of the voters said that tax cuts Brownback pushed had mostly helped Kansas, while about two in five said they had hurt.

So the tax cuts broke roughly 10 ten points in Brownback’s favor, contrary to the conventional wisdom…not that this is any surprise to me.

In the rest of the country, the tax issue popped up in referenda. John Hood (NRO – The Corner) has the details:

It’s worth noting also that conservatives won all of the nation’s big fiscal-policy referenda this year, beating a gas-tax hike in Massachusetts and business-tax hike in Nevada, while winning tax limitations in Tennessee, Georgia, and Wisconsin.

Note the states listed: Massachusetts also elected a Republican Governor. In Georgia, both Republicans (Purdue for Senate and Governor Deal for re-election) managed to avoid runoff and win outright (yet another “surprise” for the chattering classes). Finally, of course, Wisconsin re-elected Governor Scott Walker with unexpected ease.

Finally, there is Maryland, where I must spend two nights a week for work. As such, I saw every add Lieutenant Governor Anthony Brown (D) put up in his race to succeed his previous running mate, Governor Martin O’Malley. Brown’s ads ran the gamut of positive and negative, hard-hitting issue ads and soft-touch personal ones. By contrast, I only saw one ad for Republican Larry Hogan – an ad that tried to squeeze in all of O’Malley’s tax increases in 30 seconds (practically one per second), along with a promise to give taxpayers a rest if he (Hogan) won.

In fact, Hogan did win.

Similarly, Illinois Governor Pat Quinn used major tax increases to keep his state government afloat. Despite being in the president’s home state, Quinn lost to Republican Bruce Rauner last night.

Again, anger and disaffection with the president was the big driver here, but voters especially rewarded Republicans where they could also take advantage of the tax issue…

…which makes one wonder what could have happened in Virginia had Republican Ed Gillespie not had the headwinds of tax-hiking Republican Bob McDonnell to face.

I’m just sayin’.

Cross-posted to the right-wing liberal

Wall Street demands new money fix (Updated)

Update: It appears the Fed isn’t listening (Washington Post), good for them.

They’re at it again.

The Wall Streeters who made their money while hooked on “quantitative easing” (or QE, for short) – the fancy term for when the Federal Reserve sucks up a whole range of securities and turns them into dollars – are insisting the world will come to an end if they don’t get their next fix (New York Post).

…it could cost Americans another $1 trillion.

As Federal Reserve chief Janet Yellen winds down the huge Quantitative Easing 3 program, an addicted Wall Street is looking for the same fix in liquidity — a lethal cocktail to prop up feeble markets.

Despite the Fed reducing its purchases by $10 billion monthly since July, it now holds more than five times the sum of securities it had before the financial crisis.

The balance sheet, which exceeds $4.4 trillion, is approaching the size of Japan’s gross domestic product.

Of course, Wall Street would love to see QE4: it props up bond prices (when bond rates are low, their prices are high), while shoving folks who aren’t lucky enough to be sitting on that paper into stocks in a desperate search for a return on their investment. Stock and bond prices rise all around, creating an asset bubble.

Never mind that this does nothing for actual economic growth. Never mind that it exacerbates wealth and income inequalities (which are a real problem when they are caused by rent-seeking behavior like this).

In effect, we are still seeing the after effects of the Panic of 2008. The economic correction that should have happened was avoided when Washington enacted TARP (and thus convinced Americans that all the banks were sick, rather than just some of them). The flip-side was the fear of a “credit crunch” that was actually caused by shocking the corruption out of the LIBOR rate – while rates that were based on actual transactions (rather than a manipulated survey) barely moved.

To be fair, the Fed actually sounded the alarm on LIBOR, only to be ignored by their British counterparts. Still, the fact is, this in an economic funk that was caused not by the private sector, but two governments (in Washington and London)…and one of them is still perpetuating the myth that got us here in the first place.

Cross-posted to the right-wing liberal

Hillary Turns Left

The economic illiteracy of the the Democrat party is on full display as Hillary tries to make the ridiculous claim that businesses do not create jobs. Thats is correct. She said that this is, “trickle down economics.”  No Hillary, is the free market. I remember the 80’s and 90’s. The private sector – relatively unencumbered generated wealth and our median income skyrocketed from $30K to $50K per household.

Under Obama the medical industry has become a government regulated nightmare.  Under this same administration the auto industry was turned over to the unions as a payoff for their political support in the 2008.  Coal is being killed off, one regulation at a time.  Under the burden of ever greater government control of the economy, we have fared worse.  The Obama’s  recovery has seen a greater loss in median income that the recession that came before it:

New estimates derived from the Census Bureau’s Current Population Survey by Sentier Research indicate that the real (inflation-adjusted) median annual household income in America has fallen by 4.4 percent during the “recovery,” after having fallen by 1.8 during the recession.  During the recession, the median American household income fell by $1,002 (from $55,480 to $54,478). During the recovery—that is, from the officially defined end of the recession (in June 2009) to the most recent month for which figures are available (June 2013)—the median American household income has fallen by $2,380 (from $54,478 to $52,098).  So the typical American household is making almost $2,400 less per year (in constant 2013 dollars) than it was four years ago, when the Obama “recovery” began.

So what is Hillary’s proposition to fix this mess? She is doubling down on Obamanomics, the false proposition that government creates jobs and wealth.  This experiment has most recently failed not only here, but in Venezuela where Chavez nationalised most industries and imposed price controls.  Now people there are not only not able to get gas and food, they cannot even buy toilet paper.

Most command economy statists, like Chavez and Hilary, are seeking to return us to our gentle, medieval past.  A time where life was brutish, and short.  A time when your betters could demand what you do in life. Hilary is now seeking to give us four more years of Obama.  Under Obama the number of net new jobs is only 4,311 v. Bush’s  11,458.  Both are poor performers, especially when compared to Reagan’s 167K per month and Bill Clinton’s 236K.  During those presidencies the government regulatory burden was lessened.  Obama is choking the economy.  From the sounds of Hillary’s latest speech she is looking to only tighten government’s chokehold on the economy.  Statists never learn.

Europe embraces its collapse with carbon reduction requirement

As we careen toward Election Day, the rest of the world drones on. Across the Atlantic, the European Union has decided to try reducing carbon emissions by 40% over the next fifteen years. Anthony Watts thinks it’s nuts…

Eric Worrall writes: The European Union has just committed economic suicide, by agreement a landmark deal, to cut CO2 emissions by 40% by 2030.

Given that European emissions, by any rational measure, have been rising steadily, this would at first seem to be an impossible goal.

But anyone who is expecting a rational re-appraisal of European environment policy – don’t underestimate the blind determination of Europe’s green elite, to fulfill their dream of an emission free Europe. They will, in my opinion, happily bomb the European economy back into the stone age to achieve their ridiculous goal.

…and he’s not necessarily wrong. I do think, however, he needs to take into account the nature of the European economies. The Mediterranean nations are back on their…backs. France is slumping badly. Even Germany appears headed for recession (Open Europe). Yet the perverse quest for “ever closer union” continues in the EU.

So, the Eurocrats had two choices: acknowledge their grand political and economic experiment has been a bust, or embrace the collapse and try using it to achieve something politically correct.

Is it really a surprise which one they chose?

Cross-posted to the right-wing liberal

Bob McDonnell was a WHAT?!?!

Reactions to the Bob McDonnell verdict our pouring in, and there’s one in particular (from many of his defenders) that I find completely flabbergasting.

The ex-Governor’s defenders are calling him a “man of integrity.” My jaw hits the table each time I see that.

Folks, Bob McDonnell spent all of 2009 insisting he would not raise taxes. He blasted his opponent (Creigh Deeds) for even considering it, and rode the issue to a landslide win in November of that year.

In the last year of his term (as it happens, last year) he broke that promise in spectacular fashion, ramming through the largest tax increase in at least 40 years.

Even then, he skirted the truth. He insisted the tax hike was for relieving commuter congestion, but in fact his top priority was actually a parallel road to US 460 that wasn’t needed for traffic relief – and which the Army Corps of Engineers said he couldn’t build anyway (Bacon’s Rebellion).

So please, spare me the “man of integrity” nonsense. If you want to complain about the federal decision to prosecute McDonnell (as opposed to other Virginians) or the bizarre nature of the “honest service fraud” statute, that’s one thing.

But Bob McDonnell was no angel.

Cross-posted from the right-wing liberal

President Obama’s Latest Interview on the Economy – More Pinocchios on the Way

Guest Post by Howard Roark:

President Obama was on a roll in a recent interview with “The Economist”.

“Feel free to keep your house” sounds for my comfort too much like “If you like your doctor, you will be able to keep your doctor, period. If you like your health care plan, you’ll be able to keep your health care plan, period. No one will take it away, no matter what.” How does this guy think he deserves any say whatsoever in whether anyone gets to keep their home?

Politifacts rated the oft-repeated keep your health plan and doctor statement as the lie of the year in 2013, and many, many others agreed, including the “Washington Post” who gave the President the biggest Pinocchio of the year award.

Obama continued,

“Our policies have produced a record stock market, record corporate profits, 52 months of consecutive job growth, 10 million new jobs … an energy sector that’s booming … a housing market that has bounced back … I think you’d have to say that we’ve managed the economy pretty well.”

Let’s think about those claims a little. Anyone who knows anything about the stock market and the economy gives credit for the record stock market to Ben Bernanke and Janet Yellen rather than Barack Obama. Massive infusions of liquidity into the financial markets do more to pump up stock prices than does a massive expansion of government, taxes and regulations.

Corporate profits are expanding, but primarily because many of our biggest employers are fleeing the United States because of high taxes and other government-imposed costs, and others are shipping our jobs to other countries. Income for most Americans, however, has been flat. Real, per capita disposal income was $36,078 in 2008 and rose a whopping two percent to $36,815 by 2013. This is all great if you are Goldman Sachs, Microsoft, JP Morgan Chase or Citibank (all among Obama’s top-ten contributors in 2008) but not so good if you are a middle-class American trying to support a family and save for retirement.

Obama needs some remedial math schooling regarding his job creation numbers also. In December 2008, the last full month before he took office, total nonfarm employment was 134,774,000. It had risen to 139,004,000 by last month. I make that 4,230,000 jobs for paltry growth over those years of about 3 percent; not 10 million jobs.

By comparison, nonfarm employment was 90,943,000 jobs in December 1980; the month before Ronald Reagan took office. By December 1988; Reagan’s last full month in office, the number had grown to 106,906,000 for an increase of nearly 16 million jobs representing employment growth of about 18 percent.

A much larger percentage of the jobs created during President Reagan’s administration were good, full-time jobs as opposed to the largely part-time, low-wage jobs for which Obama can claim credit. Obama had better hurray. He has only a couple of years to catch up with President Reagan’s stellar job growth record and the improvements in our standard of living we saw in the 1980s.

Obama likes to claim, as he did in this interview with “The Economist,” that he faced the worst economic crisis since the Great Depression of the 1930s. Well, maybe. The unemployment rate during Reagan’s presidency resulting from the recession he inherited topped out at 10.8 percent in November and December of 1982. The highest unemployment rate during Obama’s tenure was 10.0 percent in October of 2009. I guess it all depends on how you spin the numbers.

The energy sector is booming, but despite the Obama Administration rather than because of anything they have done. The Obama Administration and its radical environmental supporters (remember, like the California hedge fund billionaire who helped buy the Virginia election for McAulliffe) have prevented a great deal of energy exploration, blocked construction of the Keystone Pipeline, and candidate Obama even stated his desire to kill off the coal industry. Imagine where the U.S. economy and energy industry would be if we had a growth- and jobs-friendly president.

Regarding home prices, the S&P Case-Shiller 20-City Home Price Index was at 150.67 in December of 2008. As of May of this year it was at 171.04. That’s nominal growth of about two percent per year; significantly below historical averages. Even then, whatever credit is due goes to the Federal Reserve rather than the Obama Administration. Hundreds of billions of dollars of quantitative easing purchases of mortgage-backed securities that infused massive liquidity into the mortgage market and kept mortgage borrowing rates down did more to bring about home price recovery than did anything from the Obama Administration. Or, perhaps, is Obama so self-deluded as to think that “cash-for-clunkers,” subsidies for Solendra and various fellow cronies, and other waste as part of his “stimulus” magically cured the housing market?

By the time this interview concluded I suspect that the White House maintenance people had to be called in. There’s no way the President would be able to get his head through a normal door frame with all of these new Pinocchios.

Obama’s immigration order threats mean Ex-Im Bank is probably dead

There has been a lot of speculation about the president ordering a mass de facto legalization of millions of unauthorized immigrants “by summer’s end” (Charles Krauthammer, NRO), and the possibility that he might just be hoping for an impeachment reaction, judging by Dan Pfeiffer’s reaction (Reid Epstein, Wall Street Journal). His fellow Democrats appear giddy just at the prospect of being able to defend the president from an impeachment effort (Reuters).

Most of the discussion regarding impeachment has revolved around whether it’s politically wise for Republicans to push it – and it’s not – while far fewer have asked if anyone really wants Joe Biden in the White House (and I guarantee that has a lot to do with why voters are leery of impeachment in general).

That said, I can’t help but noting that what the immigration-cum-impeachment strategy for the midterm elections tells us: namely, that the previous strategy – namely shutting down the government to preserve the Export-Import Bank – is dead, and the Bank itself likely will be, too.

The Democrats were hoping the Ex-Im gambit would divide Republicans and convince Chamber-of-Commerce types to fund Democrats instead. Of course, the plan had serious flaws: the Bank itself disappears on September 30, so on October 1 the Democrats will be trying to use the shutdown to change government policy; many leftist are scratching their heads about their party’s about-face on the corporatist Bank; and the Chamber types themselves are hardly unanimous on the wisdom of the Bank itself, let alone making it a priority.

By contrast, going “double I” means the Democrats can wake their base out of its current stupor while making Republicans look racist, out of touch with the American people, or both. It’s too good a narrative to foul up with the Bank of Boeing.

So I’m fairly optimistic that an executive order on immigration means the Export-Import Bank is on its way out.

Cross-posted to the right-wing liberal

Another TARP opponent survives

The victory of Pat Roberts (Republican U.S. Senator from Kansas) in his primary battle is reaffirming the conventional wisdom that “Establishment” Republicans are thwarting “Tea Party” challengers. As one may expect, I don’t automatically share that view. In fact, I think the Tea Party vs. Establishment meme misses the point.

Most would be surprised to see Roberts hit from the right, and one big reason is his vote against TARP (a.k.a. the bank bailout). This is the first chance for Kansas Republicans to weigh in post-TARP on whether Roberts should be the nominee. I find it telling that Roberts survived while TARP proponents like Eric Cantor did not.

Odds are the bailout vote was even more critical in Mississippi, where Thad Cochran (a No on TARP, despite my mistaken assumption) was able to limp into a runoff (and then a narrow if unorthodox victory) when a TARP backer likely would have gone down in flames.

Lest we forget, a large plurality of voters still blame Bush the Younger for the state of the economy…meaning TARP, contrary to popular belief in Washington, has not been forgotten.

Even Mr. Establishment Heavy himself – ex-Congressman and Defending Main Street PAC leader Steve LaTourette – was a No on TARP. That should tell us all something.

Cross-posted to the right-wing liberal

The 2016 Republican nominee better have an alternative to Obamacare

There is a lot of discussion about the effects and wisdom of the Halbig decision, including some amusement at the site of a leading Obamacare architect turn himself into a rhetorical pretzel. However, one thing that has not really been addressed is the need to be serious about “repeal and replace.”

Republicans need to remember that if the Supreme Court actually follows the D.C. Circuit Court panel and knock down all subsidies in states that do not have their own exchanges, millions will find themselves with unaffordable health insurance – and likely go back to the ranks of the uninsured. When that happens, the GOP needs to be ready with an alternative health care reform plan that brings these people back into the insurance market, while reducing the effect of the government’s “invisible foot” in health care in general.

The earliest the Court will hand down a decision is the summer of 2015 (and it could be the summer of 2016). Either way, it will land somewhere in the presidential campaign, meaning the Republican candidate(s) need to spend some time addressing this issue, or get drowned out by the Democrats screaming, “Republicans ended the subsidies and deprived millions of health care just to score political points against Obama.”

Of course, there is plenty of space for right-of-center health care reform: ending the tax-favoritism towards group plans, breaking the AMA’s de facto monopoly on health care prices (handed to them by the federal government), addressing the health-care-provider shortage with supply side economic reforms specific to that industry, etc.

If the defeat of 2012 taught us anything (besides never nominated a TARP backer again), it taught us that an unpopular plan (Obamacare) still beats no plan (Romney’s complete lack of an alternative). The dynamics of a post-Halbig American will drive that lesson home even further. The Republican ticket in 2016 will either learn that lesson, or lament their defeat.

Cross-posted to RWL

Egregious Ex-Im Deal of the Day

I basically copied and pasted the title from Veronique de Rugy, who got it herself from the Blog of the House Financial Services Committee – where Chairman Jeb Hensarling is leading the fight against the Export-Import Bank.

The Bank’s defenders insist that it’s all about helping American exporters, but they largely ignore the fact that most of the exports are intermediate products, which foreigners get with discounted loans from market rates. Thus, these firms have a leg up in competition against their American counterparts. The largest (and loudest) victim of this is Delta Airlines, which much compete with a slew of foreign airlines that get Ex-Im funded deals on Boeing airplanes that aren’t available to the American firm.

Lest anyone think this is the only example of Ex-Im run amok, the HFSC began daily highlights of the Bank’s loans. The first one was yesterday (I’m assuming they’ll continue on Monday). Here was the “Egregious Ex-Im Bank Deal of the Day” (HFSC, emphasis in original):

Hardworking American taxpayers, who are paying more for gas (“Gasoline prices at six-year high – AAA”) and “more for almost everything this year” (CNBC), might be wondering why President Obama refuses to approve the Keystone Pipeline but is using their tax dollars to finance foreign corporate welfare — like the nearly $5 billion in direct loans to help build a venture developed by Saudi Aramco, Saudi Arabia’s state-owned oil company.

This is the same Saudi Aramco, by the way, that one report this week said is “pulling the rug out from under the U.S. gas industry” and has announced plans to spend its money to build 11 45,000-seat capacity stadiums by order of King Abdullah.

Here are the deal details:

In 2012, the Ex-Im Bank provided a record-breaking $4.975 billion in direct loans to help build Sadara Chemical Company, developed by the Saudi Arabian Oil Company (Saudi Aramco). Saudi Aramco, the state-owned oil company of Saudi Arabia, is the world’s biggest oil company, with total assets reportedly in the trillions. – (Sources:  Export-Import Bank press release, 4/4/13:  “Sadara Chemical Company Transaction is Awarded Ex-Im Bank Deal of the Year”;Saudi AramcoForbesUniversity of Texas)

Please note the description of Saudi Aramco – the state-owned oil company of Saudi Arabia. Are we really supposed to believe that they needed Ex-Im’s help for financing?

Reminder: Senator Mark Warner joined all of his fellow Democrats in voting for the Ex-Im Bank’s reauthorization in 2012 (vote). His Republican opponent, Ed Gillespie, has called for it to be shut down.

Cross-posted to the right-wing liberal

The Real War on Women is an Economic One

The labor force participation rate among women, which had grown steadily since the 1950s, began to flatten out under Bill Clinton (no pun intended), and remained fairly steady during the Bush 43 years, including the recession.  However, it has fallen off a cliff under Obama.

The economic well-being of women and their opportunities for employment were much greater under conservative administrations.  We must even give Bill Clinton some credit here.

Obama has been a disaster for the economic well-being of women, and his administration has reversed the positive trend of women’s growing participating in the work force that had been going on for over 50 years until Obama came along. The last time that the labor force participation rate for women stood at 56.8% was October 1988. Basically, Obama has wiped out all the gains that women have made in the workplace since the end of the Reagan administration.

laborforcewomen

What is happening with USHCN temperature data?

Over the weekend, what started as an argument among global warming skeptics became a dramatic indictment of temperature reporting from the United States Historic Climate Network.

Anthony Watts (Watts Up With That) and Judith Curry (Climate Etc.) provide the details on Steve Goddard’s initial attempt to claim that a large swath of temperature “raw” data was in fact estimations. Watts is particularly self-aware in acknowledging why he had trouble with Goddard’s assertions, while Curry ties it to the underlying data problems.

Both then get to the meat of the matter: Paul Homewood’s revelation that data in not one, but two locations were “adjusted” to create a warming trend of 1-2 degrees that never shows up in the actual data.

Meanwhile, Watts also reveals this stunner: as many as one in four stations “reporting” weather data are in fact shut down, and “reporting” estimated figures derived from neighboring – and in theory still operating – stations.

Curry – who does not consider herself a skeptic on global warming, but is rare in that she does not simply dismiss those who are – summed up with this is so important:

This incident is another one that challenges traditional notions of expertise. From a recent speech by President Obama:

“I mean, I’m not a scientist either, but I’ve got this guy, John Holdren, he’s a scientist,” Obama added to laughter. “I’ve got a bunch of scientists at NASA and I’ve got a bunch of scientists at EPA.”

Who all rely on the data prepared by his bunch of scientists at NOAA.

…and if that data is problematic, all of those scientists have a serious problem.

Cross-posted to the right-wing liberal

New House Majority Leader: Kill Ex-Im Bank

The primary defeat of Eric Cantor continues to reverberate in unexpected ways, as his incoming successor as Majority Leader tells Fox News that he supports shutting down the Export-Import Bank (Washington Examiner):

On “Fox News Sunday,” host Chris Wallace asked McCarthy if he agrees with “conservatives who say that the Export-Import Bank is a form of crony capitalism and it should be put out of business — allowed to expire.”

McCarthy responded by tying Ex-Im to “one of the biggest problems with government,” using taxpayers’ “hard-earned money,” to do things the private sector can do. McCarthy supported Ex-Im’s reauthorization in 2012, but he argued on Fox News Sunday that this was a vote to “wind down the Ex-Im Bank.”

Wallace put the question more directly: “You would allow the Ex-Im Bank to expire in September?”

McCarthy immediately said “Yes. Because it’s something that the private sector can be able to do.”

That’s a dramatic change in view from Cantor, and a refreshing one. If McCarthy is serious about it (and that bizarre explanation for his 2012 vote should give us some pause), it would strike a strong blow against corporatism.

Ex-Im’s defenders have three months to save their special interest, and they will throw everything including the kitchen sink to do so. McCarthy’s stance is to be praised, and we should help him hold his newfound ground.

Cross-posted to the right-wing liberal

State Senator Phil Puckett resigns; deck chairs on Titanic to be re-arranged

Richmond is all agog over the resignation of State Senate Phil Puckett (Richmond Times-Dispatch), which grants the Republicans a temporary majority in the State Senate, pending a special election which the Republicans are favored to win. According to the RTD, Puckett’s resignation paves the way for his daughter to be elected to a judgeship, while he himself could land on the Virginia Tobacco Indemnification and Community Revitalization Commission.

All eyes (in Richmond) went immediately to the budget, where according to the Constitution (emphasis added):

No bill which creates or establishes a new office, or which creates, continues, or revives a debt or charge, or which makes, continues, or revives any appropriation of public or trust money or property, or which releases, discharges, or commutes any claim or demand of the Commonwealth, or which imposes, continues, or revives a tax, shall be passed except by the affirmative vote of a majority of all the members elected to each house, the name of each member voting and how he voted to be recorded in the journal.

Normally, that means 21 out of 40. Given that we only have 39 at the moment, 20 should actually work…for the State Senate to pass the budget until the special election. In the grand scheme of things, though, there is a lot less than meets the eye. Here’s why.

First, not every Republican State Senator supported the Republican budget: Walter Stosch (Dave Brat’s patron), John Watkins, and Emmett Hanger all voted with the Democrats to add Medicaid expansion to the budget. In theory, party unity could convince them to change their minds, but there’s no guarantee of that.

Second, there is still the Governor: If one wanted to hand Terry McAuliffe the perfect excuse for a budget veto, coaxing a Senator’s resignation with the promise of appointments for himself and his daughter would be it. I’ll admit, a veto is unlikely, but this deal is excellent ammunition for Election Day 2014, 2015, and 2017.

Speaking of…

Third, even if the GOP wins the budget battle, the fight of Medicaid will go on, and this will make it harder to win: According to Christopher Newport University (poll), the Republicans were actually winning the debate on Medicaid expansion. That might, and probably will, change if T-Mac can now claim perfidy from the opposition. This allows Terry McAuliffe – Terry F–king McAuliffe - to run as Mr. Clean, and the Democrats to present themselves as the Clean Team in 2015 and 2017.

Odds are this will even damage our recent nominee for U.S. Senate – Ed Gillespie, the consummate Virginia Republican insider.

We may even see the Republicans cave on Medicaid expansion just to neutralize the issue in 2015.

Fourth, the State Senate is the poisoned chalice of recent times. Let’s say the GOP does win the special election and holds all 21 seats next year, which I’ll admit is still likely despite the above (or because of the previous sentence). Let’s take a look at the fate of the party controlling the state senate after the last six midterm elections (1991, 1995, 1999, 2003, 2007, 2011). In all six cases, the party lost the ensuing gubernatorial election. In five of them, they lost House seats and a majority of the statewide races. In three, they lost all statewide races, and in two they lost the senate itself.

Now, one could say even that might be worth it if a Republican Senate would mean greater momentum for limited government, but that just isn’t so…

Every Republican-controlled State Senate in the 21st Century has enacted a tax increase: That’s right; there was the referendum of 2002 (defeated by the voters), the Warner tax hike of 2004 (which, at $1.5 billion, was only half what the State Senate originally wanted), HB3202 (largely overturned by the courts), and Plan ’13 From Outer Space. If anything, it has been minority status that forces Republicans to behave.

Given all of the above, I can’t help thinking that this victory is meager, if not pyrrhic.

Cross-posted to the right-wing liberal

Rob Wittman for Re-election

Unlike the painful situation in the 7th District, Republican voters in the 1st (which included me until I moved into the 4th last year) are blessed with two superior choices: incumbent Rob Wittman and challenger Anthony Riedel. They are both near-perfect on the issues (the only major blemishes are Wittman’s farm policy votes and Riedel’s overly doctrinaire non-interventionism). Either would do their constituents proud.

However, I am endorsing Wittman, for one very simple reason: he opposed TARP, not once, but twice.

Readers of this blog know how much importance I give to the bank bailout. I have called TARP a policy mistake practically since its conception, and I am still convinced of that. I am also certain that support for TARP has been a serious problem for Republicans. Given this, when presented with Republican elected officials who were willing to defy their own president, their own candidate for president, and their own party leaders to do the right thing and vote No, I am compelled to stick by them.

Thus, I am sticking by Rob Wittman.

Cross-posted to the right-wing liberal

Meanwhile, on Medicaid expansion in Virginia, the Republicans are actually winning

“First, you win the argument, then you win the vote” – Margaret Thatcher

On Medicaid expansion in Virginia, proponents have the newly-elected Governor, all of Virginia’s Democrats, a few dissenting Republicans,the State Senate and various well-heeled interests.

Opponents have the reality of Medicaid’s damage to poor people and (most of) the Republican Party of Virginia – a party that is badly, badly divided, controls only a majority in the House of Delegates, and was just handed it’s first goose-egg in Virginia offices in over twenty years.

Yet, according to Christopher Newport University, the RPV is actually winning the debate:

Virginians have been paying attention to the debate over Medicaid expansion taking place in Richmond, with 58% saying they have been following it either very closely or somewhat closely, and only 20% saying they have not followed it at all. Given the current contours of that debate, Virginians say 53% to 41% that they oppose Medicaid expansion. This is a reversal from the Wason Center survey released February 3 (see below), which showed general support for Medicaid expansion, 56% to 38%.

However, in that February survey, support for Medicaid expansion fell to 41% with 54% opposed, when respondents were asked if they would still support expansion if the federal government did not pay its share and Virginia had to cover the cost. That risk has been a key contention in the Republican argument against expansion. Those February numbers are very close to the 41% to 53% in the current poll, suggesting that Republican skepticism concerning expansion has gotten through to voters.

Simply put, this was hardly what was expected. In fact, I suspect most in the Virginia rightosphere still suspect that the Republicans in the House will cave on this issue…and perhaps they still will.

However, we should give credit where it’s due: not only has the Howell-led HoD held the line so far against Medicaid expansion, they also are winning the argument – the first critical step to winning votes, as Thatcher noted.

Cross-posted to the right-wing liberal

Oh joy…another immigration flame-fest

So, new RPV Executive Director Shaun Kenney (full disclosure, close friend of mine) takes some time to sit with center-left activists on the immigration issue. Much of his talk centers around thanking them for stopping by, talking about how it’s important to talk to folks who don’t necessarily agree with them, and an observation on the debate that was miles above anything discussed on the matter since…

I genuinely believe that both sides of this debate want to do the right thing; it’s just a matter of getting those wires to touch.

It didn’t take long for the wires to vehemently protest. Soon Greg Letiecq (also a friend) was slamming Shaun for advocating amnesty – something which, I confess, I didn’t catch in the video excerpt Greg provided, although Greg and Shaun have made clear their disagreement on the issue for years. Soon Jeanine Martin and Brian Schoeneman (whom I would also call friends, but as I’ve never met either of them in person, I don’t know what they would think), joined in the fray, with Martin claiming Shaun would hurt poor people and Brian calling Jeanine and Greg racists (in the comments).

Yeah, it’s that kind of party.

Sadly, as both sides spent their time reminding themselves how wonderful they are – hey, we’re bloggers; it’s what we do – the questions I raised almost two months ago remain completely outside of the discussion:

  • What are we doing to encourage entrepreneurs to come to America?
  • What labor shortages in the American economy (such as, health care) can be alleviated via immigration reform?
  • How can we use our immigration policies to take advantage of capital flight in areas around the world, so that those who own that capital will feel more welcome here (along with their capital, of course)?
  • In other words, how can we use immigration reform as a supply-side economic opportunity, rather than merely an argument about Keynesian “aggregate demand”?

As I stated in that post, anything that doesn’t address the above subjects is just noise…which is exactly what we got from nearly everyone concerned – a lot of heat, but very little light.

As for Shaun, I’m glad he’s willing to talk to folks outside his political comfort zone. At the very least, we all need to remember how to disagree without being disagreeable.

I would have been much happier if he and Mr. Sajur had spent some time talking about the above topics….

Cross-posted to the right-wing liberal

IMF Introduces Ukraine to Faux-sterity

No matter what the situation, no matter how bad the problem, no matter how catastrophic the state of affairs, a nation can always count on the International Monetary Fund to make things worse.

This week, Ukraine is about to learn that painful lesson.

The IMF is sending $18 billion to the new Ukraine government, but like everything else the IMF does, it’s merely a loan, and it comes with crushing conditions that will damage the already-flattened economy there even more.

Among the faux-sterity demands on the IMF….

An income tax hike from 17% to 25%: yet another reminder that “supply-side” is still foreign to the IMF (The Hindu)…

An increase in consumption taxes: showing that at least the IMF is consistent – they don’t understand Keynesian economics either (Wall Street Journal).

A reduction in gas subsidies (which is good), but not a privatization of the Naftogaz gas firm (which is bad): When you manage to make the governor of Yanukovic’s home province (Donetsk) sound like Mr. Clean, you’re doing it wrong (WSJ again).

Some (perhaps) reduction in the government bureaucracy: although it’s hard to tell just how many. CNN says 24,000. Russia Today says 80,000, but limited to the “law enforcement” sector only – leaving aside than anything out of RT should be taken with a lotswife of salt. Either way, at least the IMF learned not to try the government-pay-cuts that kept Greece’s government just as large in size and scope while pretending to cut its cost.

Still, overall, this is a painfully unnecessary set of “reforms,” which will badly miss revenue targets and likely put Ukraine in a far deeper economic contraction than the current projection of 3%.

Meanwhile, the Russian creditors get full return, despite propping up the Yanukovic regime that put Ukraine on its back in the first place (Telegraph).

So Ukraine will follow Greece and Spain over the economic cliff…

…while Putin and his cronies laugh all the way to the bank.

Cross-posted to the right-wing liberal

On the Bank Bailout, the Buckley Rule, and Ed Gillespie

There has been increasing talk among Virginia Republicans about “the Buckley Rule,” and how it should impact decision on the nomination for U.S. Senate. There are, however, two problems with the application (usually from Ed Gillespie supporters): the rule isn’t quite what they think it is; and even if it did, Gillespie still wouldn’t qualify.

First of all, the rule itself is repeatedly “both misquoted and misapplied” as Neal Freeman noted in his account of when the rule was first promulgated (National Review). He should know; he was there. Buckley came up with the rule during the 1964 Goldwater-Rockefeller nomination battle. Despite what we may think, Rockefeller had his defenders on the right. He trailed LBJ by less than Goldwater, and his anti-Communism was rock-solid and unquestionable (Goldwater himself noted in his autobiography that before he decided to run himself, he was leaning to Rockefeller). It took months for NR itself to make a decision:

These intramural arguments, as I say, were protracted, begun in the winter and carrying on into the early spring. WFB sat at the head of the table, encouraging others to speak, keeping his own counsel. In early June, after Rockefeller had won the Oregon primary and Goldwater had won California, after all of us had had our say, after rumors had begun to creep out of 35th Street that NR might shift its support to Nelson Rockefeller — the equivalent, today, of word leaking out of 15th Street that the Washington Post might endorse Michele Bachmann — Bill, who rarely proposed, decided that it was time to dispose. With each of us in our assigned seat and with six pairs of eyeballs staring at him unblinkingly, Bill announced that “National Review will support the rightwardmost viable candidate.”

Victory for Team Goldwater! We all knew what “viable” meant in Bill’s lexicon. It meant somebody who saw the world as we did. Somebody who would bring credit to our cause. Somebody who, win or lose, would conservatize the Republican party and the country. It meant somebody like Barry Goldwater.

Indeed, NR did endorse Goldwater. More to the point, one year after this, Buckley himself chose to run for Mayor of New York – despite having no shot at winning – against the Republican establishment’s candidate, John Lindsay….

in the general election.

So clearly, those who use the Buckley rule as an electability argument have it wrong. However, even if they had it right, Ed Gillespie has a problem that sinks his electability: his support for TARP (a.k.a. the Bank Bailout).

Gillespie supporters will, of course, take issue with this. They will tell you (and me) that the key issue in 2014 isn’t the bank bailout, but the failures of the Obama Administration. As it happens, the critique against the Administration has three planks: government has grown massively large and costly; the economic “recovery” is so sluggish as to be hardly felt; and the president’s dangerous habit of assuming the Affordable Care Act is an American Enabling Act giving him legislative powers to change the law on the flyThe problem is that pro-TARP candidates are unable to use any of these arguments.

If Ed Gillespie tries to criticize the president and Mark Warner for reckless spending and government enlargement, Warner can throw the $700 billion bank bailout back in his face, but Mark Warner cannot accuse Shak Hill of supporting hundreds of billions in spending for America’s biggest banks.

Likewise, any attempt by Gillespie to discuss the economy will be trumped by Warner mentioning the 2008 financial crisis – and then remind everyone that Gillespie agreed the crisis was exceptional because of his support for the bank bailout. Only Shak Hill can remind voters that the bank bailout and hysteria ginned up by Washington to get it enacted made things worse, not better.

Finally, there is the fact that after TARP was enacted, Bush’s Treasury Secretary Henry Paulsen rewrote the law at whim. That he had the authority to do so was bad enough, but Warner can play it simple and demand to know why Bush can change the law at whim but not Obama. Only Shak Hill can address this issue with the hypocrisy charge being thrown back in his face.

In short, Shak Hill can deliver the conservative message in 2014 far batter than Ed Gillespie can. As a result, he is a more “viable” candidate than Ed, and in my opinion, a more electable one, too.

Cross-posted to the right-wing liberal

Another achievement for government-run health care: VA deletes appointment to pretend its backlog is cleared

Mark Flatten (Washington Examiner) has the details on the latest government-run health system to succumb to fraud: the Veterans Administration.

Thousands of orders for diagnostic medical tests have been purged en masse by the Department of Veterans Affairs to make it appear its decade-long backlog is being eliminated, according to documents obtained by the Washington Examiner.

About 40,000 appointments were “administratively closed” in Los Angeles, and another 13,000 were cancelled in Dallas in 2012.

That means the patients did not receive the tests or treatment that had been ordered, but rather the orders for the follow-up procedures were simply deleted from the agency’s records.

That’s not all …

Debra Draper of the Government Accountability Office said reviews of scheduling practices at VA facilities, including Los Angeles, have repeatedly found instances in which appointment dates were falsified to meet performance goals. That finding was consistent with GAO and VA inspector general’s reports going back 10 years, Draper said.

Charles C. W. Cooke says this looks all too familiar (The Corner): “Alas, this feels all too familiar to someone who grew up with Britain’s National Health Service.”

He then gives some examples. I’ve gleaned a couple on my own. As Cooke puts it, “when one subordinates healthcare to government, one inevitably gets all of the usual government games.”

Games like this.

Cross-posted to the right-wing liberal