Our Own War

Forget the current Crimean crisis. It’s Wednesday evening, March 5, 2014, here on the West Coast, ten or so time zones away from Kiev, five days into this, and Russian tanks are not rolling into the Ukraine to take back the place for Mother Russia, or for whatever empire Vladimir Putin has thought up to replicate the old Soviet Union that went the way of the Great Auk. Heck, none of those six thousand or more Russian troops now in the Crimea have even put their insignias back on, so really, there really are no Russian troops there, sort of. Putin maintains they’re just concerned citizens or something, and the talks continue, now in Paris, next in Rome, but no one wants war. And while we want sanctions, to punish Putin for being a bad boy – after all, the Crimea, even if it had been a part of Russia forever, has been part of the Ukraine for many decades now – the Europeans are wary. They need the Russian natural gas that is fed to them through the Ukraine, their main source of energy now that everyone’s backing away from nuclear power, and there’s too much interlocking trade in other goods and services now anyway – crippling the Russian economy, to get Putin to back down, would cripple their own economies.

That means no one is going to do anything at the moment. Putin may or may not realize he’s overreached, but it’s hard for him to back down now, now that he’s fully committed to being seen as a total jerk in the eyes of the world. He has to prove that invading and occupying the Ukraine’s Crimean peninsula, even if he’s set up a bit of plausible deniability, wasn’t a dumb-ass thing to do, really. That’s not going to be easy, as everyone in the West seems to be in the right here, but even that’s not all that useful. What’s the good in being right if you can’t do anything about it? It’s a standoff – the blustering guy who made the foolish move, who really needs a way to back down gracefully, without looking like an even bigger jerk, staring face-to-face with those who really can’t do anything to make him pay for that foolish move, or even offer him some face-saving concessions, because he was wrong, damn it.

Nothing can happen now, which is probably for the best. A few days of things as they are now, and then a few weeks, and then a few months, and then a few years, and everyone will go about their business. Russia will have troops in Ukraine’s Crimean peninsula, as they always have had – their Black Sea fleet is based in Sevastopol – and the rest of the Ukraine will continue to integrate itself with Europe, not Russia, just like before. One way to see this is as a crisis about what some see as the awful status quo, a status quo that actually works well enough as is. Everyone will get over it.

But it is all Obama’s fault, or something. The current meme is that Benghazi caused the Russians to invade the Ukraine – because when you kill Americans and nobody pays a price, you invite this type of aggression, and way back then we should have killed some people right back, right away, or something. That would have made Putin think twice? Those two particular dots are hard to connect, and some on the right are a bit embarrassed by those who are out and about screaming this to the rooftops. Sure, it’s an election year, at least a midterm election year, but most voters don’t remember what happened three years ago in Benghazi, or even know where the place is. As for Kiev, well, there’s Chicken Kiev, right? Rachel Ray once made that on television, if memory serves, but bring up Sevastopol and you’ll get a blank stare. Huh? If you’re going to attack Obama, use Obamacare and those Death Panels and the outrage that the wrong sort of people getting a chance to buy health insurance, or those food stamps no one really deserves, or unemployment benefits, which no good people ever deserve, or raising the minimum wage, which will ruin American businesses and make everyone’s daily Big Mac cost a few pennies more. Just don’t pull out a whiteboard and draw a direct line from Benghazi to Sevastopol. People will walk. All politics is local.

The current Crimean crisis distorted all that. The Ukrainians are no doubt fine people, but those right here who work hard and pay taxes want to know what they’re getting for their money, quite personally – roads and bridges and schools and a military that keeps them safe, and eventually Medicare and Social Security – and they want to know the big bucks they pay in taxes aren’t being used for stupid stuff, or being spent on people who don’t deserve a dime of it. That last part is a very personal thing. America runs on envy and resentment – that’s what fuels economic growth, as one does have to have the latest whatever, and thus what makes capitalism work, and also what drives public policy. Voters have their grudges. Sevastopol isn’t on their minds.

That’s why what should have interested voters, had they not been distracted by Putin’s gambit, was direct talk about what the government was supposed to do – Obama released his budget proposal, and Paul Ryan released his. Obama’s budget will never pass the Republican House, and Ryan’s budget will die in the Democratic Senate, but each threw down the gauntlet. Each said “this” is what America should be doing, and that’s what the midterm election will be about, and the next presidential election.

Obama did go all-in with his budget:

President Obama sent Congress a $3.9 trillion budget request on Tuesday that stands as a platform for Democrats to run on in this election year, full of policies intended to invite contrasts with Republicans rather than offer compromises as he did last year, without success.

Mr. Obama’s budget for the 2015 fiscal year, which begins Oct. 1, reflects his aspirations in his waning presidency, regardless of the political reality he confronts. The document, his sixth budget, seeks to energize Democratic voters with populist proposals like a more generous tax credit for the working poor, paid for with higher taxes on the rich.

The president, as before, seeks to balance calls for spending and tax-cut policies to help the economy against measures to reduce already declining deficits. But this year his emphasis is on the investment side to address the rise in economic inequality, broaden opportunities for upward mobility and spur technological innovation.

He lost the Republicans at “higher taxes on the rich” of course, but that was a conscious choice:

“Our budget is about choices, it’s about our values,” Mr. Obama said as he visited an elementary school in Washington. “As a country, we’ve got to make a decision if we’re going to protect tax breaks for the wealthiest Americans or if we’re going to make smart investments necessary to create jobs and grow our economy, and expand opportunity for every American.” …

“We’ve got to decide if we’re going to keep squeezing the middle class, or if we’re going to continue to reduce the deficits responsibly while taking steps to grow and strengthen the middle class,” Mr. Obama said at the school. “The American people have made clear time and again which approach they prefer – that’s the approach my budget offers.”

And he’s through with expecting to be able to work with the Republicans:

Gone from his budget is the concession Mr. Obama proposed to Republicans last year, as his second term began, to reduce future Social Security cost-of-living increases. The president had hoped that gesture, made over Democrats’ objections, would entice Republicans to compromise on a “grand bargain” of long-term deficit reductions and federal investments. But Republicans refused to consider raising tax revenues from the wealthy and some businesses, as Mr. Obama sought.

He’ll stick it to them on that. Just as the Ukrainians are no doubt fine people, maybe the poor and middle class are fine people and really do need a bit of help, but not at the expense of the rich – as the rich need to be nurtured and protected just as much? Obama is forcing the Republicans to make that sort of argument. That’s why, if the minimum wage goes up, your Big Mac will cost a few pennies more. No CEO should earn a penny less, or corporate profits can’t drop even one hundredth of a percent. Priorities, folks! Obama is betting no everyone agrees with their priorities.

Obama is betting the other way, particularly in details like this:

Buried in the $3.9 trillion budget request that President Obama sent to Congress on Tuesday is a clause that has Wall Street tax advisers on edge.

The proposal would essentially forbid so-called inversions, an increasingly popular maneuver that allows United States companies to legally reincorporate in a new country when they buy a smaller foreign corporation, thereby avoiding paying the Treasury Department millions or even billions of dollars in taxes.

Outlined in an appendix to the budget known as the Green Book, which describes the administration’s revenue proposals, the new language would make inversions all but impossible to pull off.

“This will essentially eliminate inversions as we know them,” said Robert Willens, a corporate tax adviser who has helped companies accomplish such transactions.

If an American company, by incorporating in Tortuga under the name of its little subsidiary with three employees there, can no longer do that, and thus can’t avoid paying millions or even billions of dollars in taxes, what’s the point of being a proud American at all? There are a lot of such details, each designed to make Republicans howl, or finally admit they don’t give a shit about the poor and the middle class.

They won’t admit that, so we get this:

As a direct counter to President Obama’s recent emphasis on the gap between rich and poor, the upcoming House Republican budget will focus on welfare reform and recommend a sweeping overhaul of social programs, including Head Start and Medicaid.

The push, led by Rep. Paul Ryan, returns the GOP’s attention to a policy front that animated the party in the 1990s and signals Republicans’ desire to expand their pitch to voters ahead of this year’s midterm elections. This new effort comes after the party spent months fixated on combating the federal health-care law and engaged in intraparty squabbles over fiscal strategy.

On Monday, Ryan (R-Wis.), the House Budget Committee chairman, published an often stinging 204-page critique of the federal government’s anti-poverty policies, questioning the efficacy of dozens of initiatives and underscoring where Republicans say consolidation or spending reductions are needed.

“There are nearly 100 programs at the federal level that are meant to help, but they have actually created a poverty trap,” Ryan said in an interview. “There is no coordination with these programs, and new ones are frequently being added without much consideration to how they affect other programs. We’ve got to fix the situation, and this report is a first step toward significant reform.”

Ryan wants massive cuts to all that stuff. Tear it all down and slowly but surely make it more efficient. That will help the poor and middle class eventually, and no rich people were harmed in the making of this movie, because the massive cuts are everything:

Food stamps, low-income housing, and a flurry of other social service programs and tax credits are also targeted in the report. Ryan said Republicans will soon offer specific prescriptions to the problems he outlines. Putting a comprehensive anti-poverty agenda alongside efforts to devise an alternative to the federal healthcare law is a GOP priority, he said. …

Ryan said the crux of the report is the conclusion that federal programs need to be entirely reimagined, with more than tweaks or axed appropriations, and that legislation this year should move toward broader solutions that solve what he thinks are structural weaknesses in how the government supports the poor.

In short, something new may take forever, but we need to stop doing what we’re doing, right now. Only that will help the poor, but Jonathan Chait is rightly skeptical:

The bigger dilemma is that Ryan’s budget goals leave him no room to maneuver. He’s committed to balancing the budget within the next decade. But he wants to prop up defense spending, refuses to increase tax revenue, and has promised to maintain Social Security and Medicare benefits for all current retirees. He recently cut a deal with Democrats to ease cuts in the main domestic spending programs. Having taken everything else off the table, the only place left for his cuts is programs that benefit the poor.

And Ryan’s budget absolutely slays the budget for anti-poverty programs – the vast majority of his spending cuts come from the minority of federal programs aimed at the poor. That fact has led to his current predicament: Democrats have painted him as a cruel social Darwinist, causing him to become concerned about his image as an “Ayn Rand miser,” causing him to re-brand himself as a poverty wonk, causing him to dive into scholarly literature. But scholarly literature is never going to show that his plans to impose massive cuts to the anti-poverty budget will help poor people.

Chait reviews how every scholar Ryan cited said that Ryan completely misunderstood what they had said, or misquoted them, and adds this:

And yet, without the massive cuts to the anti-poverty budget, Ryan has no plausible way forward. Reconciling the ideological goals of the House Republican caucus with the best findings of social science is fundamentally impossible. That’s why Republican leaders usually dismiss those findings as biased tripe from liberal eggheads.

Brian Beutler adds this:

Actually the evidence is right there on the first page of his new report. “Despite trillions of dollars in spending, poverty is widespread,” it reads. “In 1965, the poverty rate was 17.3 percent. In 2012, it was 15 percent.” Sounds like a huge bust, right?

Except, there’s a footnote at the end of that sentence, and it reads, “The Official Poverty Rate does not include government transfers to low-income households.”

I’m surprised Ryan included this caveat, even though it’s more honest to include it than to leave it out. Because it also reveals that his critique of federal anti-poverty programs is premised on a metric designed to create a false impression that tons of money has been wasted, when really it’s done exactly what it was supposed to.

The war on poverty has indeed been a bust if you treat the poor people it’s lifted above the federal poverty line as if they remain impoverished. But that’s like saying “The earned income tax credit has failed you because, if you don’t count the value of the tax credit, you’re still in poverty,” and then applying the same logic to millions of beneficiaries.

Salon’s Joan Walsh is even less kind:

Seriously, how many times are we going to be told that there’s a “new” Paul Ryan who really, really, really cares about the poor – and whose budget proposals consistently slash programs designed to help them. All that’s different about Ryan’s approach now is he’s telling the poor that cutting their programs is good for them, because it will free them from “the poverty trap.”

She’s not buying it:

He complains, correctly, that too many anti-poverty programs are “means-tested – meaning that benefits decline as recipients make more money – [so] poor families face very high implicit marginal tax rates. The federal government effectively discourages them from making more money.”

Of course, the alternative to means-tested programs in other industrialized nations is universal programs that essentially set a floor for income, nutrition and health below which families can’t drop. Social Security and Medicare are rare American examples of universal program – ones that Ryan has repeatedly tried to gut (while most Republicans and even some conservative Democrats endorse “means testing” them). A guaranteed family income and a genuine national health insurance program could eliminate means-tested programs like Temporary Assistance for Needy Families and Medicaid – but Ryan and his GOP allies (and lots of Republicans) would never consider those notions.

Nor will they consider the other guaranteed anti-poverty program: a hike in the minimum wage. Raising the minimum wage to $10.10 an hour would lift almost a million Americans out of poverty immediately – but Ryan’s party is opposed to it. Indeed, more Republicans are coming out every day saying there should be no minimum wage at all.

There is, indeed, a poverty trap in the U.S., and the media fall into it again and again: taking seriously the warmed over Reaganism of conservatives like Paul Ryan, and pretending there’s something in it that will help the poor.

And there’s Kevin Drum:

Even conservatives – the more honest variety, anyway – will concede that liberals have plenty of reasons to be skeptical of Ryan’s goals. His annual budget roadmaps have consistently relied on slashing spending for the poor, and Republicans in general have been consumed with cutting safety net spending for decades. It’s perfectly natural to view a report that lambastes federal poverty programs as merely the first step in an effort to build support for cutting spending on those programs.

Drum would like to see some of Ryan’s proposals, when Ryan actually proposes something, anything, rather than saying that something should one day be proposed:

Liberals should certainly be open to making safety net programs more efficient, and if that’s Ryan’s goal he’ll find plenty of Democrats willing to work with him. But that all depends on knowing that this isn’t just a Trojan Horse for deep cuts to spending on the poor.

So how about if we hear this from Ryan? How about if he says, plainly and clearly, that he wants to improve the efficiency of safety net programs, but wants to use the savings to help more people – or to help people in smarter ways – not as an excuse to slash spending or to fund more tax cuts for the wealthy? Really, that’s the bare minimum necessary for liberals to suspend their skepticism, given Ryan’s long history of trying to balance the budget on the backs of the poor.

This would require a genuine turnabout from Ryan, and it would require him to genuinely confront his Tea Party base with things they don’t want to hear. And it would demonstrate that helping the poor really is his goal. But if he’s not willing to do that, why should anyone on the left believe this report is anything other than the same old attack on the poor as moochers and idlers that’s become practically a Republican mantra over the past few years?

And right there is the battle that has been being waged when all eyes were on the Ukraine. Each side has said “this” is what America should be doing, decisively and emphatically, and are playing on Americans’ endless supply of envy and resentment, pulling out all the stops. Ask your church organist about that. Pull out all the organ stops and things get really loud, as this will. Forget the current Crimean crisis. That will sort itself out. This won’t.


About Alan

The editor is a former systems manager for a large California-based HMO, and a former senior systems manager for Northrop, Hughes-Raytheon, Computer Sciences Corporation, Perot Systems and other such organizations. One position was managing the financial and payroll systems for a large hospital chain. And somewhere in there was a two-year stint in Canada running the systems shop at a General Motors locomotive factory - in London, Ontario. That explains Canadian matters scattered through these pages. Otherwise, think large-scale HR, payroll, financial and manufacturing systems. A résumé is available if you wish. The editor has a graduate degree in Eighteenth-Century British Literature from Duke University where he was a National Woodrow Wilson Fellow, and taught English and music in upstate New York in the seventies, and then in the early eighties moved to California and left teaching. The editor currently resides in Hollywood California, a block north of the Sunset Strip.
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One Response to Our Own War

  1. Rick says:

    Kevin Drum suggests Paul Ryan offer concrete proposals on programs designed to “help” the poor:

    “Liberals should certainly be open to making safety net programs more efficient, and if that’s Ryan’s goal he’ll find plenty of Democrats willing to work with him. But that all depends on knowing that this isn’t just a Trojan Horse for deep cuts to spending on the poor. … But if he’s not willing to do that, why should anyone on the left believe this report is anything other than the same old attack on the poor as moochers and idlers that’s become practically a Republican mantra over the past few years?”

    Have we heard anything in what Ryan has said that indicates he really believes in helping the poor in any way other than cutting off money to the programs that help them? If so, I must have missed it.

    In fact, what would lead any liberal to think Ryan might have backed away from his classic conservative view, that we should not be spending any money whatsoever on poor people, purportedly because not allowing them the chance to dig their way out of the hole they’ve allowed themselves to fall into just “traps” them into an endless cycle of poverty?

    The fact that Drum discusses this in a way that suggests there is still a good possibility Democrats and Republicans could somehow unite on how to deal with poverty seems to assume that many of the Democrats among his readers are fooling themselves, and need to cut the disingenuousness, since that pretense has been failing us up to now.

    What I also find telling, in listening to Ryan discuss all this, is that while he seems to (or pretends to; take your pick) express concerns for the poor themselves, he never seems to acknowledge that helping the poor doesn’t just help them, it is also good for the economy and, in fact, the country as a whole. This just may be the difference between conservatives and liberals: The former doubt our fighting poverty is good for either the country or the economy, but don’t care, since, more importantly, it creates “moral hazard” either way, while the latter do believe helping people out of poverty not only helps all of us, it is also the very definition of “doing good”, which is the exact opposite of “moral hazard” creation.

    So no, what we have here is two totally different world views, never the twain to meet. Until the cows come home, conservatives can argue that they are the ones who really care about the poor, and liberals can pretend that conservatives actually mean well, but neither of these two assumptions is true.


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