Sometimes I Think This Country Is Too Stupid To Survive — Part 2

Part 1 dealt with one ridiculous aspect of the story: how the $3.5 trillion everybody is talking about ignores the taxes and cost savings that would approach $3.5 trillion and offset the spending. Paul Waldman of The Washington Post is disgusted with another aspect (“Our Budget Debates Are Insane”):

One of Congress’s main jobs — perhaps its most important — is to decide how to spend the government’s money. And there’s quite a lot of it; in 2022 we’ll be spending around $6 trillion.

Yet the way we talk about budgets in Washington is misconceived, misleading and often downright mad.

Everything wrong with how we think of spending money can be seen in the current negotiations over the social infrastructure bill Democrats hope to pass through reconciliation. But to put this in its proper context, let’s consider another, much bigger bill.

On Thursday, by a vote of 316 to 113, the House passed the National Defense Authorization Act, which will fund our military operations to the tune of $768 billion in the coming year. The nay votes were mostly conservative Republicans and liberal Democrats, presumably dissenting for opposite reasons.

If you’ve been following the reconciliation debate — in which people have been absolutely obsessed with the supposedly terrifying number of $3.5 trillion [Note: which ignores the taxes and cost savings that would pay for it!!!] — you might have thought the defense bill would produce enormous breast-beating about out-of-control spending and debt. After all, that $3.5 trillion is over 10 years, or $350 billion a year, less than half of what we’re going to spend on the military.

But that’s not what happened. . . . 

There were no painful negotiations, no ultimatums, no desperate threats. President Biden did not have to beg and plead to secure anyone’s vote. And you sure didn’t see centrist members of Congress expressing deep concern about its size, claiming it was irresponsible to add so much to the national debt — although we’ll easily be spending $8 or $9 trillion on the military over the same 10-year period.

Yet all that has happened on the social infrastructure bill. The bill’s final spending total — whatever it turns out to be — has been imbued with a bizarre talismanic power, as though it represents something meaningful above and beyond what it’s actually buying.

Consider Sen. Joe Manchin III’s (D-W.Va.) description of a White House meeting President Biden held with centrists to try to work out what’s holding back their support:

“He just basically said find a number you’re comfortable with,” Manchin said, adding that Biden’s message was to “please just work on it. Give me a number”.” Manchin told reporters that he didn’t give Biden a number . . . 

. . . Not only do the centrists not know their preferred number, they don’t seem to have many real opinions about what should actually be in the bill. They may object to an item here or there if you press them, but clearly their perspective starts from the conviction that $3.5 trillion is too big; they’ll fill in the details later.

But that’s completely backward. To negotiate a bill such as this is, you ought to begin by deciding what you want to do, then figure out how much it will cost.

It’s not that cost is completely irrelevant, or that there are some things we’d like to do but won’t because they’re too expensive. But we have plenty of money to work with, and the defense bill proves it.

If we decided the reconciliation bill’s paid family leave and universal pre-K and free community college and aggressive moves to promote clean energy were as important as all the guns and bombs and planes and ships in the defense bill, we’d treat it in the same way, by just buying everything without worrying about the price, because we think it’s worthwhile.

This isn’t the first time Democrats have convinced themselves that there was something magical about a particular budget number: In 2009, during internal debates about the American Recovery and Reinvestment Act and the Affordable Care Act, Obama White House advisers decided that crossing the threshold of a trillion dollars for either bill would make support melt away. As Michael Grunwald put it, “A trillion was a psychological Rubicon.”

The trillion dollar number became like “Candyman” — intone the word too many times and a monster would come to destroy you. Voters would recoil in disgust, lawmakers would cower in terror and the bill would die. So they reduced the size of the recovery bill, even knowing it was too small to give the economy the boost it needed.

Today, the centrists seem to believe that $3.5 trillion — if you’re spending it on Americans’ actual needs . . .  — will have the same effect [on public opinion?] as $1 trillion did in 2009.

But you know who doesn’t care about numbers? Republicans. When they want to pass a gigantic tax cut for the wealthy and corporations, they just do it, no matter what it costs.

You know who else doesn’t care? The public. They don’t have strong feelings about whether the [spending side of the] social infrastructure bill should add up to $3.5 trillion or $2.5 trillion (here’s a poll showing that changing the dollar figure has no effect on opinion). They’re more interested in what government is doing for them.

Which is exactly as it should be. If only [all of the] Democrats in Washington had enough sense to see things the same way.

Much Ado About Not Much

It looks like the Senate will pass an inadequate infrastructure bill after months of discussion. It’s been heralded as a bipartisan breakthrough. But it doesn’t meet the moment, as Katrina vanden Heuvel explains for The Washington Post: 

While the infrastructure deal’s architects are hailing it as proof that bipartisan cooperation is possible, in fact, the deal is both inadequate and disingenuous. Its inadequacy is illustrated by the hundreds of millions of dollars cut from the original administration proposal: no more funding for research and development, for U.S. manufacturing, for public housing, schools and child-care centers, for home and community-based care, or for clean-energy tax credits. The bill also cuts proposed funding for public transit by half, for electric vehicles by 90 percent and for broadband by a third.

The bill is disingenuous both on the spending side and on the revenue side. To lower the bill’s price tag without totally gutting the programs, the bill uses a five-year timeline as opposed to the eight years in the original Biden plan. Because Republicans refuse to consider raising taxes on the rich and the corporations — which most Americans sensibly favor — or even empowering the IRS to collect taxes that the wealthy already owe, the bill offers gimmicks such as collecting unpaid taxes on cryptocurrencies and reclaiming past coronavirus aid funds. Almost half of the supposed $1 trillion price tag is from money already authorized.

The result is that any serious effort to alleviate the real crises facing Americans will depend on progressives corralling Democratic unity around the $3.5 trillion budget resolution that has been put together under the leadership of Sen. Bernie Sanders (I-Vt.). That bill will authorize crucial funding left out of the bipartisan deal — clean energy, research and development, manufacturing aid, housing and schools, child care — as well as sustaining the child tax credit and expanding Medicare coverage.

But to pass the reconciliation bill, Democrats need the votes of all 50 caucus members, and [Sen. Krysten Sinema (D-Ariz.) and Sen. Joe Manchin (D-W.Va.)] have indicated that they may balk at the $3.5 trillion price tag. (Sinema has even said that she won’t allow any votes to interfere with her vacation plans. If she were to carry out that threat, she could torpedo both bills on her way out the door.) Once again, these so-called centrists are standing in the way of Congress addressing catastrophic climate change, investing in civilian research and development, boosting domestic manufacturing vital to our economy, and alleviating inequality and the pressures on working families. Also at stake are the chances Democrats have to retain their majorities in both the House and Senate in the 2022 elections, for their vote will surely be depressed by a failure to deliver.

It’s not that Sinema or Manchin have a specific, principled stance. They just want less. If there is a final agreement, it will probably be reached just like the infrastructure deal, by lowering the total price tag while sustaining most of the annual level of spending by reducing the number of years the programs are authorized. That will give the programs less time to take effect and make them more vulnerable to repeal.

With record wildfires, a terrible pandemic starting to revive, extreme inequality and an economy that doesn’t work for working families, most Americans increasingly realize that it is time for bold action. Yet, we have a Republican Party consumed by delusions and dedicated to making the administration fail. For all the bipartisan blather, Democrats must get it done on their own — despite having only a one-vote margin in the Senate (counting the vice president breaking a tie) and a three-vote margin in the House. And that requires Sinema, Manchin and others to get with the program.

Congress and the President Do Something Big for a Change

One congressman said he and other longtime Democratic lawmakers feared they’d never do anything consequential in Congress again. But the American Rescue Plan (aka the Covid relief bill) will be extremely consequential. There’s much more in it than $1,400 checks for most Americans and extended benefits for the unemployed.

Paul Waldman of The Washington Post describes some of the bill’s other features, the totality of which make this an historic bill (that, unlike the only major legislation of the past four years, isn’t designed to help corporations or the rich):

If anything, we’ve underplayed how significant this bill is.

Yes, those subsidy checks are important . . . A family of four with a household income under $150,000 will get $5,600, even before other measures, such as the boosted child tax credit, are accounted for. That . . . will provide a tremendous boost of economic activity that will accelerate the recovery; the American economy is now projected to grow this year at a pace we haven’t seen in decades.

But . . . the bill is full of provisions that could have significant or even transformative effects on the country, many of which have gotten little or no attention:

The child tax credit. For the next year, the bill increases the child tax credit and makes more of it “refundable,” which means that more people with very low incomes will be able to get that credit as a refund even if they’re paying little or nothing in taxes. It will also send the child tax credit to families on a monthly basis, rather than having it as something they might or might not get as a lump sum after filing their taxes. . . . 

The Earned Income Tax Credit. The bill expands the EITC for childless low-income workers; 17 million of them could see a boost in their after-tax income.

Pensions. The bill includes a provision championed by Sen. Sherrod Brown (D-Ohio) that bails out a group of 185 multi-employer union pension plans that are in danger of failing. As the New York Times put it, “without the rescue, more than a million retired truck drivers, retail clerks, builders and others could be forced to forgo retirement income.”

Student loan debt. Under current law, if you have outstanding student loan debt that is canceled, the IRS treats your forgiven debt as income, which can result in a huge tax bill. Millions of borrowers on repayment plans pay a set portion of their income every month, and after 20 years the remaining balance is forgiven. The ARP would make that kind of loan forgiveness tax-free, and it would also apply to future loan forgiveness the Biden administration might undertake.

Exploitation of veteran students. The ARP closes a loophole in student-loan rules that has provided an incentive for colleges, particularly for-profit operations, to heavily recruit veterans paying for college with the G.I. Bill; these veterans are often roped in with false promises and then left without a degree or a good education.

Farmers. The ARP provides billions of dollars in assistance to disadvantaged farmers, many of whom are Black. As The Post reports, the bill would benefit “Black farmers in a way that some experts say no legislation has since the Civil Rights Act of 1964.”

Affordable Care Act subsidies. Under the ACA, only those earning up to 400 percent of the federal poverty level, or $106,000 for a family of four, are eligible for any subsidies to help afford health insurance they buy on the private marketplaces. The ARP removes that limit, meaning those at higher incomes could get some help if their insurance costs more than 8.5 percent of their income. In addition to removing this “subsidy cliff,” it also enhances the subsidies for those at lower incomes, which will mean significant premium cuts for many people.

Medicaid expansion. Twelve states have still refused to accept the ACA’s expansion of Medicaid, leaving huge numbers of poor citizens without health coverage. The ARP boosts the federal contribution to Medicaid so that holdout states will actually make money if they accept the expansion. According to the Kaiser Family Foundation, if Texas accepted the expansion, it would [improve] its state budget [and provide] coverage to 878,000 uninsured, low-income Texans.

Mass transit. The bill includes $30 billion to shore up mass transit systems that were hit hard by the pandemic, forestalling service and maintenance cuts. As Mike Konczal of the Roosevelt Institute says, “Where we’d normally see the recovery worse from cuts, and financial weakness used as a cynical excuse to slash, privatize, and never restore public functions, the ARP moves to stop that dead in its tracks.”

There’s plenty more, including funds for child care, rental assistance and food assistance, among other things. Some of these provisions, including the student loan forgiveness provision, the pension bailout and the “subsidy cliff” fix, will only be in effect until 2025. Democrats are hoping that they’ll prove popular and effective enough that they can be made permanent. It’s a good bet that at least some of them will.

There’s a lot more to say about this bill, especially how it represents a rethinking of fiscal policy and the incentives government provides citizens. . . . But the big picture of the American Rescue Plan is that, to paraphrase a former vice president, this is a seriously big deal. And the more we learn about it as it gets implemented, the bigger it will probably look.

Bottom Up, Not Top Down

One party wants more people to vote, while the other party wants fewer. One party helps people at the economic bottom, while the other helps those at the top. It’s almost as if we should support one party, not the other!

From The New York Times, “Biden Bets on the Poor” (and the middle):

To jump-start the ailing economy, President Biden is turning to the lowest-paid workers in America, and to the people who are currently unable to work at all.

Mr. Biden’s $1.9 trillion economic relief package, which cleared the Senate on Saturday and [will] be headed for the president’s signature in a matter of days, would overwhelmingly help low earners and the middle class, with little direct aid for the high earners who have largely kept their jobs and padded their savings over the past year.

For the president, the plan is more than just a stimulus proposal. It is a declaration of his economic policy — one that captures the principle Democrats and liberal economists have espoused over the past decade: that the best way to stoke faster economic growth is from the bottom up.

Mr. Biden’s decision to take that approach in his first major economic legislation is in stark contrast to [the former occupant of the White House and unindicted co-conspirator], whose initial effort in Congress was a tax-cut package in 2017 that largely benefited corporations and wealthier Americans.

The “American Rescue Plan” advanced by Mr. Biden includes more generous direct benefits for low-income Americans than the rounds of stimulus passed last year . . . It is more focused on people than on businesses and is expected to help women and minorities in particular, because they have taken an outsize hit in the pandemic recession.

Researchers predict it could become one of the most effective laws to fight poverty in a generation. Columbia University’s Center on Poverty and Social Policy estimates that the plan’s provisions, including a generous expansion of tax credits for low-income Americans with children, would reduce the poverty rate by more than a quarter for adults and cut the child poverty rate in half.

. . . The new legislation contains provisions intended to attack the virus itself, including money for Covid testing and vaccine distribution.

But it also includes elements of longstanding Democratic priorities that will apply widely to lower-income Americans whether they are hurting financially from the pandemic or not. In addition to the tax credits, the bill increases subsidies for child care, broadens eligibility under the Affordable Care Act, and expands food stamps, rental assistance and unemployment benefits, among other provisions. . . .

Mr. Biden’s economic team is betting that a mix of $1,400 checks to individuals, more generous jobless aid and other safety-net benefits in the plan will help power a rapid increase in economic growth by aiming money at people who need help right now to pay their bills, buy groceries and stave off eviction or foreclosure — as opposed to higher earners who would be more likely to save the money.

Many economists predict that the increase in consumer spending would spur more hiring and business production, helping to lift the economy to its fastest annual growth rate since the mid-1980s. . . .

What [some] call wasteful, untargeted or counterproductive spending in Mr. Biden’s bill are, in the eyes of Mr. Biden and his allies, the key ingredients for a roaring recovery once widespread vaccine distribution restores a sense of normalcy across the nation.

“Focusing on marginalized workers,” said Janelle Jones, the chief economist at the Labor Department, “is really the way to make sure we are lifting all boats” . . .

High earners and large companies show little sign of needing government help today. On the whole, the pandemic recession and recovery have made them richer. Workers earning higher wages and those able to work remotely are far less likely to have been thrown off the job, and they have stockpiled savings in the recovery. Companies like Amazon have gained market share as consumer habits have shifted.

But at the bottom end of the income spectrum — and in particular, among Black and Latino families — millions of Americans are still feeling the deep pain of the recession. The economy remains nearly 10 million jobs short of its prepandemic peak, with women of all races and men of color struggling the most to regain employment. The unemployment rate for Black men remains above 10 percent.

Data from the Census Household Pulse survey, . . . shows that the lingering economic distress of the crisis is concentrated among low earners and those who remain out of work. Nearly half of households earning below $35,000 a year reported falling behind on housing payments. One quarter reported not having enough food.

Mr. Biden’s plan would shower those households with government assistance. Elizabeth Pancotti, the policy director at Employ America, . . . has calculated the benefits for several different hypothetical hard-hit Americans under the bill.

For a working single mother of a 3-year-old who earns the federal minimum wage — just under $16,000 a year — the bill would provide as much as $4,775 in direct benefits, Ms. Pancotti estimates. For a family of four with one working parent and one who remains unemployed because of child care constraints, the benefits could total $12,460.

The Tax Policy Center in Washington estimates that the direct payments and expanded tax credits in the bill would, by themselves, increase after-tax income this year by more than 20 percent for an average household in the lowest quintile of income earners in the United States. It previously had forecast that Mr. Trump’s tax cuts would raise that same group’s income by less than 1 percent in the first year.

“It is as far away as you can get from regressive, supply-side economics,” said Senator Michael Bennet, Democrat of Colorado, a longtime champion of an expanded child tax credit to fight poverty. “This is progressive economics that puts money in the hands of working people who will spend that money” . . . .

What the Majority Wants vs. the Minority Rule Party

The American Rescue Plan the House of Representatives passed early Saturday morning has so much in it that one amazing provision is hardly being mentioned:

President Biden and Democratic lawmakers want to fight child poverty by giving U.S. families a few hundred dollars every month for every child in their household — no strings attached. A kind of child allowance. . . . Experts say it could cut child poverty nearly in half (NPR).

It’s understandable, therefore, that polls say an overwhelming majority of Americans support the Democrats’ Covid relief bill. One poll says 76% — even 60% of Republicans — support it. But not a single Republican in the House of Representatives voted for it. 

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Paul Waldman and Greg Sargent of The Washington Post both have columns about the bill and the politics. Here’s a mixture from what they wrote:

If I asked you to explain the Republican case against the Covid relief bill, what would you say? Well, they think it’s too expensive, and they’d rather not give too much help to states and localities. But their arguments against it seem halfhearted, anemic, almost resigned. . . .

This ought to be a moment when the GOP is back in its comfort zone. It’s not a party built for governing; Republicans no longer have much of a policy agenda, their leaders have become much more skilled at obstruction than at passing laws, and they have an enormous propaganda machine with a talent for creating fear and outrage. The party’s specialty is opposition.

One of the things they’ve done in the past is cast every new Democratic or liberal move as a harbinger of an impending apocalypse. Obamacare, they said in 2010, would destroy the American health care system. If gay people are allowed to marry, they said in 2004, the result would be the end of families and the breakdown of society. Both predictions proved ludicrously wrong, but at the time, they were highly effective means of motivating opposition. Today you can still find such rhetoric, but you have to look for it. . . .

Back in 2009, [Republican congressman Paul Ryan] made a very public case against a stimulus a fraction this big, making an actual argument (if a fraudulent one) about what debt Armageddon would mean for American society.

These days it’s harder to make that case. Republicans blew up the deficit with a huge tax cut for the rich, and cheered along as the pre-Covid economy was rocket-fueled with stimulus. Economists no longer fear the long-term risks of massive deficit spending amid big crises.

As a result, there’s nothing close to the same kind of public argument this time. As Paul Krugman points out:

Republicans appear to be losing the economic argument in part because they aren’t even bothering to show up

It’s as if they know they don’t have to.

They may well fully expect Democrats to . . . get the economy booming again, even as the vaccine rollout and other policies successfully tame the pandemic.

Yet Republicans know that even if this happens, they still have a good chance at recapturing the House at a minimum, helped along by a combination of voter suppression and other counter-majoritarian tactics and built-in advantages.

[Outside of Washington] they’re racing forward with an extraordinary array of new voter suppression efforts. Such measures are advancing in Georgia, Florida and Iowa, and in many other states.

In a good roundup of all these new efforts, Ari Berman notes:

After record turnout in 2020, Republican-controlled states appear to be in a race to the bottom to see who can pass the most egregious new barriers to voting.

On top of that, Republicans are openly boasting that their ability to take back the House next year will gain a big lift from extreme gerrymanders. Some experts believe they can do that even if Democrats win the national House popular vote by a margin similar to that of 2020.

So is there any reason to doubt that they’re primarily counting on more of the same as their path back to power this time?

[But controlling the White House and both houses of Congress] presents an extraordinary opportunity for Biden and congressional Democrats if they can see their way clear to take advantage of it.

Right now, Democrats are tying themselves in knots trying to figure out how to increase the minimum wage, something President Biden ran on, their entire party believes in, and which is overwhelmingly popular with the public. Some want $15 an hour, while others would prefer $11.

Yet the Senate parliamentarian has ruled that a straight minimum wage increase can’t pass via the reconciliation process — the only way to pass a bill with a simple majority vote — the details of which are incomprehensible, or endlessly maddening, or both.

So Democrats have to find some kind of fiscal somersault to try to get the minimum wage increase into the Covid relief bill. 

This is no way to make laws. And what’s even worse is that it’s happening at a moment when Republicans — who in the past have been nothing if not skilled at undermining, vilifying, and sabotaging Democratic presidents — have seldom looked more feckless.

Republicans just haven’t been able to take the hatred and fear their hardcore base feels for Biden and scale it up and out, which then affects their ability to whip up frenzied opposition to the things he’s trying to do. And the broader context matters, too: When we’re caught in a pandemic and an economic crisis, only so many people will get worked up about whether a transgender girl is allowed to play softball.

That gives Democrats the chance to move forward confidently with their agenda, an agenda that is enormously popular. Yet some in the party are still in the grip of the nonsensical belief that it’s more important to retain a Senate procedure whose purpose is to thwart progress than to pass laws that solve problems.

In every American state legislature and in most every legislature around the world, if there’s majority support for a bill, it passes. In almost all cases supermajorities are only required, if ever, on things like constitutional amendments.

And every argument the filibuster’s defenders make about it — that it produces deliberative debate, that it encourages bipartisanship, that it makes for cooperation and compromise — is simply wrong, as anyone who has been awake for the last couple of decades knows perfectly well.

The Covid relief bill will pass, because it’s the only thing Democrats can do without a supermajority. It’s a vital, popular bill that could have been done in cooperation with Republicans had they wanted, but instead they’ve decided to oppose it. Which is their right, but it also shows how a simple majority should be the requirement for more legislating — which can only happen if the filibuster is eliminated.

The first weeks of the Biden presidency show the path Democrats can take: Push forward with the popular and consequential parts of your agenda, don’t be distracted by bleating from Republicans, act as though the public is behind you (because it is), and you might find that the Republican opposition machine isn’t as potent as it used to be.

But none of that will be possible unless Democrats can deliver on their promises. If they let themselves be handcuffed by the filibuster, the Biden presidency will fail and Republicans will take control of Congress. In other words, Democrats will have done the job Republicans couldn’t do themselves.

Unquote.

Neither of the columnists mentioned two key parts of the Democratic agenda.

The John Lewis Voting Rights Advancement Act would strengthen the Voting Rights Act of 1965. It would protect voters from racial discrimination and voter suppression.

The For the People Act would expand voting rights, overhaul our campaign finance system, and end extreme partisan gerrymandering.

All that stands in the way of these bills becoming law is the current requirement that ten Republican senators vote for them. That’s why the 50 Democratic senators need to end or severely limit the filibuster, thereby restoring majority rule to the US Senate. That’s how we can help restore majority rule to the United States of America.