A Day in an Alternative Universe

April Fools’ Day is always problematic. People want to punk you. The classic was from 1957 – the BBC news program Panorama ran a pleasant and innocuous segment about spaghetti harvesting in Switzerland, where farmers grow pasta on trees, as everyone knows. Hundreds of people called asking how they could get their own spaghetti tree. That set the gold standard for such things. This year’s effort, the Guardian newspaper announcing they were going Twitter-only, was, by comparison, pretty lame. The world is an absurd place, and getting more absurd by the moment, with people every day saying all sorts of things are true – it’s hard to come up with a good prank. See Colbert assess Fox News’ Glenn Beck – every day seems like April Fools’ Day on Beck’s show, and CNN has Lou Dobbs.

 

But this year things got even trickier on that special day. Particularly in London – our young black American president and his elegant and smart-as-a-whip stunning wife had tea with the Queen of England, cleared up eight years of testy relations with Russia, suggesting a new arms treaty could come soon, established a new bilateral working relationship with China on all major issues, mollified Gordon Brown, the Prime Minister in those parts, met with other key leaders, chatted with kids, then faced down the British press who demanded that he explain why everything wasn’t, really, America’s fault and no one else’s. And he did this with a nasty cold that made him sound a bit like Daffy Duck. And it seemed that the Queen liked her gift from the Obama’s – the iPod loaded with those Richard Rogers show tunes she loves. They say she particularly likes “Oklahoma!” – which seems very odd.

 

All of this seemed unlikely, something like spaghetti harvesting in Switzerland. But, as unlikely as it seems, we do have a black president, cosmopolitan and gracious, and a first lady of both charm and intelligence, and all these things happened in London – unless it was an elaborate April Fools’ Day prank. In the Tom Stoppard play, Rosencrantz and Guildenstern Are Dead, as the two title characters are on a ship bound for England, where they will be executed, the one says to the other that he really doesn’t believe in England, that he’s not sure it even exists. The reply to that was this – “Just a conspiracy of cartographers, then?” Perhaps this April Fools’ Day gave us a conspiracy of print, broadcast and cable reporters. That might be possible.

 

But the oddest thing took place back in Washington, with this:

 

House Republican leaders unveiled their alternative to the proposed Democratic budget Wednesday, calling for $4.8 trillion less in overall spending over the next decade – in part through a five-year freeze in most nondefense discretionary spending.

 

The GOP budget would repeal the entire $787 billion economic stimulus package except for an extension of unemployment insurance benefits. It also would roll back a recently passed 8 percent spending boost in the budget for the remainder of the current fiscal year.

 

At the same time, the federal share of Medicaid payments would be converted to block grants for the states. Medicare would be transformed for Americans younger than 55 by allowing them to choose from a series of preapproved private insurance plans, with premium payments from the federal government to insurers varying according to an individual’s age, income and health.

 

Okay. Their earlier announcement of an alternative budget the previous week was a botched publicity stunt – to great fanfare they announced their plan to fix everything, but had no numbers at all. That was an embarrassment. So they had to come up with something. The something was stop all stimulus, freeze spending, eliminate Medicare by methodically forcing everyone to buy their health insurance from private insurance firms – and cut taxes.

 

Jon Perr has the video of the presentation, with notes:

 

Taxpayers making over $100,000 would see their rate drop to 25% from its current high of 35%. (Below that level, the rate drops to 10%.) Corporate taxes would also drop to 25%. While the capital gains tax rate would be frozen at its post-2003 level of 15%, the estate tax would be eliminated altogether.

 

The predictable result is yet another massive redistribution of the tax burden away from the richest Americans even as it produced a torrent of red ink.

 

He notes that the Center for American Progress calculates that this plan would result in an annual tax bonus of one and half million dollars to the average CEO – which some must think they deserve. The Center for Tax Justice had this analysis – by 2011, the Republican plan would drain the Treasury by three hundred billion dollars more than the Obama plan, and would make sure the right people are punished:

 

Over a fourth of taxpayers, mostly low-income families, would pay more in taxes under the House GOP plan than they would under the President’s plan.

 

The richest one percent of taxpayers would pay $100,000 less, on average, under the House GOP plan than they would under the President’s plan.

 

It’s a matter of priorities. Josh Marshall at Talking Points Memo calls it reassuringly the same.

 

So on April Fools’ Day these guys said Americans are fed up with government safety nets like Medicare, as they have always been fed up with Social Security, and hate that the government is backing away from rewarding the very wealthy with ever bigger tax breaks – we need to protect the rich, you see. And stimulus is foolish, as those who still have jobs are just fine and everyone else can go to hell, or some such thing. The extension of unemployment insurance benefits is odd – it was their saint, Reagan himself, who pretty much defined unemployment insurance as a moral hazard, as it creates a nation of lazy bums who like to pretend they’re victims.

 

Perhaps it was an April Fools’ joke. But everyone had been taunting them for being too busy mocking the Obama administration to offer any concrete policy solutions of their own, calling them the Party of No, so they had to do something to counter the budget Obama proposed in February. So this is it – cancel the entire stimulus plan in 2010, with the exception of unemployment insurance, make Bush’s 2001 and 2003 tax cuts permanent, and further slash taxes for top earners and corporations, freeze all non-defense discretionary spending for five years and cut health services for the poor and elderly. They say this is what is right, and what everyone really wants.

 

And here’s an odd video clip – MSNBC’s Contessa Brewer questioning a congressman from Arizona, John Shadegg, asking “if you are cutting your tax revenue and cutting spending, how is that going to stimulate the economy?”

 

Shadegg simply says that drilling for oil offshore and in the protected area of Alaska will be stimulus enough:

 

SHADEGG: Well there are lots of ways to stimulate the economy without spending money. … For example, a group of us proposed the “no cost stimulus” bill a few weeks ago, in which we said if we would streamline many of the regulations that are slowing down, for example, a lot of the industrial work that could occur in this country, if we would streamline some of the regulations and expedite some of the processing of environmental challenges so we could be drilling off of our coast or drilling in ANWR….

 

BREWER: So your answer here is to allow damage to the environment, in order to create jobs?

 

Of course – but she missed what he was really saying. Deregulate everything and drill everywhere – that’s saying we should get rid of government and get rid of rules. These guys believe in total freedom. You may get anarchy, and ruin and death, but you get growth. And of course the worthy prosper while the unworthy perish.

 

Ben Travers has more of the chit-chat around the issues here. It’s what you would expect, but he points out that the Congressional Budget Office is silent on the sanity of all this, as they don’t evaluate resolutions or proposals, only legislation, and the proposal isn’t legislation of any sort. But he does note Kenneth Baer, communications director at the administration’s Office of Management and Budget had this to say – “If you expected a GOP alternative to the failed policies of the past that got our country into the worst economic crisis since the Great Depression, then I have two words for you: April Fool’s.”

 

But it seems they were serious.

 

Christopher Beam, on the other hand, argues that the Republicans were punked:

 

Watching congressional Republicans elaborately introduce their second alternative budget – this time with numbers – it was hard not to see them as victims of a cruel prank.

 

Opposition parties typically present an alternative – sometimes more than one – to the administration’s budget. But it’s by no means required. And for good reason: If the party doesn’t control Congress, the budget stands little chance anyway, making it more important as a rhetorical device than as a fiscal blueprint. And when the process is rhetorical, the minority generally does better when forcing the majority to defend its position rather than explaining its own. (Besides, the president’s own party can often be counted on to create headaches for the administration.) All this explains why, especially when it comes to a budget, the opposition usually takes a pointillist approach, targeting one provision at a time.

 

And they had been doing that – Beam documents that carefully. But they were taunted, and they took the bait:

 

The first draft – more a statement of principles than a budget – was widely mocked. (GOP leaders now say it was more of a “marketing document” or a “blueprint” than an actual budget.) It also allowed White House press secretary Robert Gibbs to twist the knife on prime time: “The party of ‘no’ has become the party of no ideas.”

 

The second draft, released Wednesday, is substantive but does little more than reiterate familiar GOP policies. It cuts entitlement spending, extends the Bush tax cuts of 2001 and 2003, simplifies the tax system so people pay either 10 percent or 25 percent on income, and imposes a five-year spending freeze. Republican budget committee member Rep. Paul Ryan framed it in terms of long-term debt, pointing to a series of graphs comparing projected deficits under Obama’s budget with the more prudent Republican alternative. The diverging lines said it all. “We want to tackle these fiscal challenges before they tackle us,” Ryan said – twice.

 

That takes care of the “ideas” charge. But it doesn’t mean the ideas are new, or popular, or that they make sense. (The budget makes projections all the way to 2080, prompting one liberal blogger to ask why it fails to account for the invention of warp drive.) Ryan said voters voted for Obama’s personality, not his policies. But if Obama’s policies are guaranteed health care, funding for education, and reaching out to unfriendly countries, then polls suggest that Americans do support him.

 

In short, they got trapped, or outmaneuvered by the better politician. This is not supposed to happen to Republicans. The Democrats are supposed to be the dupes – that is their traditional and customary role. It was as if an alternative universe opened up, and on the appropriate day.

 

Beam also has some interesting speculations:

 

Would the GOP have been better off with no alternative at all? Outright rejection vs. constructive engagement is a perennial dilemma of opposition parties. In the last eight years, Democrats argued constantly whether “Not Bush” was enough of a platform to win an election. “You can play this either way,” says longtime budget guru Stan Collender. “On the one hand, they rose to the challenge and can now say they’re more than just the party of ‘no.’ On the other hand, every time you put out a detailed budget, you give people the opportunity to attack it.” (Democrats don’t mind if they do.)

 

Fair enough: The failure to produce an alternative may have been more damaging than producing one. But Republicans were against having a budget before they were for it. They can now be criticized for both the budget they failed to produce and the one they did produce.

 

Yep, they should have taken Nancy Reagan’s advice and just said no. And of course, for those of us out here in Hollywood, at Balloon Juice there was this assessment of the Republican budget plan – “This is just embarrassing. It’s like watching a Pauly Shore movie.” That’s an inside joke.

 

What isn’t an inside joke is what is behind all this madness. Forget the about spaghetti harvesting in Switzerland, and those spaghetti trees. Think about the prime conflict in the concept of America – you’re free to do what you want and keep the goodies you accumulate, but this place is also a cooperative, a community where everyone pitches in to make the rules. It was an odd idea from the get-go.

 

And it all comes down to money. In the New Scientist see Mark Buchanan with Why Money Messes with Your Mind:

 

Simply thinking about words associated with money seems to makes us more self-reliant and less inclined to help others. And it gets weirder: just handling cash can take the sting out of social rejection and even diminish physical pain.

 

This is all the stranger when you consider what money is supposed to be.

 

For economists, it is nothing more than a tool of exchange that makes economic life more efficient. Just as an axe allows us to chop down trees, money allows us to have markets that, traditional economists tell us, dispassionately set the price of anything from a loaf of bread to a painting by Picasso. Yet money stirs up more passion, stress and envy than any axe or hammer ever could. We just can’t seem to deal with it rationally… but why?

 

Buchanan covers all the current research, based on obvious observations:

 

Our relationship with money has many facets. Some people seem addicted to accumulating it, while others can’t help maxing out their credit cards and find it impossible to save for a rainy day. As we come to understand more about money’s effect on us, it is emerging that some people’s brains can react to it as they would to a drug, while to others it is like a friend. Some studies even suggest that the desire for money gets cross-wired with our appetite for food. And, of course, because having a pile of money means that you can buy more things, it is virtually synonymous with status – so much so that losing it can lead to depression and even suicide. In these cash-strapped times, perhaps an insight into the psychology of money can improve the way we deal with it.

 

In reality we are not that rational. Instead of treating cash simply as a tool to be wielded with objective precision, we allow money to reach inside our heads and tap into the ancient emotional parts of our brain, often with unpredictable results. To understand how this affects our behavior, some economists are starting to think more like evolutionary anthropologists.

 

He goes on to cover Daniel Ariely of the Massachusetts Institute of Technology suggesting that modern society presents us with two distinct sets of behavioral rules:

 

There are the social norms, which are “warm and fuzzy” and designed to foster long-term relationships, trust and cooperation. Then there is a set of market norms, which revolve around money and competition, and encourage individuals to put their own interests first.

 

It is just hard, sometimes, to keep things straight, which may, of course, define the problem in Washington. And there is this:

 

Kathleen Vohs in the department of marketing at the University of Minnesota, Minneapolis, and colleagues, first got student volunteers to complete a task in which they had to make sensible phrases either from a set of words that had nothing to do with money (such as “cold”, “desk” or “outside”) or from money-related words (including “salary”, “cost” or “paying”). Then they asked individuals from the two groups to arrange a set of discs into a particular pattern.

 

The researchers found that the volunteers who had been primed with the money-related words worked on the task for longer before asking for help. In a related experiment, people in the money-word group were also significantly less likely to help a fellow student who asked for assistance than were people in the group primed with non-money words…

 

You see the implications, and Vohs says the trick is to get the correct balance between the two mindsets. That may be difficult, as played out in our politics. And there is the matter of avoiding pain:

 

In a study to be published soon in the journal Psychological Science, Vohs and psychologists Xinyue Zhou of Sun Yat-Sen University in Guangzhou, China, and Roy Baumeister of Florida State University, Tallahassee, found that people who felt rejected by others, or were subjected to physical pain, were subsequently less likely to give a monetary gift in a game situation. The researchers then went on to show that just handling paper money could reduce the distress associated with social exclusion, and also diminish the physical pain caused by touching very hot water.

 

And so it goes. And then there is Paris:

 

The idea that money taps into brain circuits evolved to make biologically important activities rewarding is given a further boost by another strange discovery. In an attempt to provide an evolutionary explanation for our motivation to strive for money in present-day societies, Barbara Briers of the HEC business school in Paris, France, and colleagues decided to test whether our appetite for cash is directly related to our appetite for food.

 

They made three discoveries: hungry volunteers were less likely to donate to charity than those who were satiated; those primed to have a high desire for money, by having imagined winning a big lottery, went on to eat the most candy in a taste test; and people whose appetites had been piqued by sitting in a room with a delicious smell, gave less money in a game situation than those who played in a normal-smelling room…

 

Briers reckons this indicates that our brain processes ideas about money using the same pathways evolved to think about food, so that in our minds the two are synonymous. If she is correct, it puts a whole new spin on the term “greedy bankers.”

 

There’s much more, and the Buchanan item is dated March 18, not April Fools’ Day. Actually, however, Buchanan goes a long way toward explaining the dynamics of this April Fools’ Day. None of it, save for the Twitter thing, was a joke, some sort of absurd prank. Everyone was serious – which does not make any of it any less funny.