World Politics

[ChrisE]

Exhibit A for what is wrong with this country. This is a democrat.

http://www.washingtonpost.com/world...tagon-budget/2011/08/04/gIQAWM8AvI_story.html

lol

http://www.scribd.com/doc/61684192/Rick-Perry-s-Texas-A-M-Transcript

 

[Amsterhammer]

I've just been watching a number of economists and other 'experts' talking about fundamental decisions that need to be taken by the EU if the Euro in its current form is to be saved! They were all pretty pessimistic. There was talk of a possible 'double-dip recession' in the US. Friday's Guardian editorial below also makes sobering reading. We could all be in even deeper doo-doo very soon.


The former Italian prime minister Romano Prodi tells Radio 4: "We don't know who is in charge". President Barack Obama talks about the "headwinds" buffeting the American economy then promises vaguely: "Things will get better. And we're going to get there together." And George Osborne keeps tabs on the financial maelstrom by phone from his holiday hotel in Beverly Hills.

Chancellors of the exchequer are entitled to holidays of course, but Mr Osborne's absence unfortunately provides the perfect metaphor for the lack of political leadership this week. Labour were quick to pounce on that fact yesterday in order to score some easy points; but the absence of economic governance during this crisis goes much more broadly than that – and is far more dangerous too. Over the past three years, the banking crisis has morphed into a crisis of sovereign debt; that is, a crisis of governments. Within the past two years, a little local difficulty at the state treasury in Athens has blown up into a full-blown catastrophe for Greece, then Ireland, and now Portugal, Spain and Italy. No one rules out the prospect of government-less Belgium being dragged into the firing line soon and, judging by the way bond markets are behaving, even France is treated as a greater credit risk than it was two weeks ago. Nor is this wave of selling confined to the continent: yesterday the FTSE 100 dropped over 100 points for the third day in a row – the first time that has happened since Lehman Brothers collapsed in September 2008 – to close 10% down on the week. Wall Street was off 200 points at lunchtime, despite a jobs report which showed a slightly firmer labour market than economists feared.

What we have here are two separate problems – but they are linked by a common factor. In Europe the big crisis is over governments which are either flat broke – Greece, Portugal and possibly Ireland – or are at least having cashflow problems: Spain and Italy, who are now both being charged over 6% for loans to the government. In the US the long-running worry is over the health of the economy. And the issue that links these two continents' troubles is a lack of political leadership – or, as Mr Prodi succinctly put it in regard to Europe, "a problem of power".

A problem of power is why Europe could not get its act together to lend some money to Greece at a sensible rate, when its public-finance problems first became apparent in Christmas 2009. Had eurozone policymakers done so then they would have paid out between €30bn and €50bn, according to forecasts at the time. Instead, they dithered and equivocated and came up with a bodge job. The result is that they have just sanctioned a second loan for Greece, this one worth €109bn.

A problem of power helps to explain how Barack Obama got dragged into a stupid haggling session with the Republican party, and is only now focusing on what is surely the biggest issue of all: spurring job creation amid one of the most tepid economic recoveries of modern times. Yesterday's labour-market survey in the US was indeed better than expectations – but that is only because expectations were so low. And there are plenty of other signs that the US economy is close to flatlining: consumer spending down; factory orders falling; the housing market still extremely weak.

In autumn 2008 governments in Westminster and Washington did exercise power to prop up the banks and provide a small jump-start to a faltering economy. In Europe there was no such concerted action to sort out the banks, which is why eurozone officials now have to conduct financial stress test after financial stress test. But even in the US and the UK, governments have all but removed their stimulus policies – with the result that both economies are now stuttering. The result may look like a financial crisis; but it is really a failure of government.

 

[Bala Verde]

Although there was relatively good news about job creation in the US, the markets were extremely volatile on Friday. After that bit of positive news the markets rallied, then plunged on near-Euro-collapse news and settled to rally upon news that Italy would firmly deal with its domestic situation. However, with S&P's downgrade of the US over the weekend, there is talk about another round of QE, and a rating downgrade of France, which would shift the burden of saving Spain and Italy to Germany eek, Monday could be carnage on the markets... Despite the fact that many companies were reporting relatively good earnings in there previous quarters.

China issued a scathing critique of the way the US dealt with the debt-ceiling, and their rating agency already downgraded US, they eagerly exploited the situation by saying that S&P basically confirms what they already found weeks ago.

US politicians are already scrambling to lay the blame with the 'other' party.

 

[usedtobefast]

Although there was relatively good news about job creation in the US, the markets were extremely volatile on Friday. After that bit of positive news the markets rallied, then plunged on near-Euro-collapse news and settled to rally upon news that Italy would firmly deal with its domestic situation. However, with S&P's downgrade of the US over the weekend, there is talk about another round of QE, and a rating downgrade of France, which would shift the burden of saving Spain and Italy to Germany eek, Monday could be carnage on the markets... Despite the fact that many companies were reporting relatively good earnings in there previous quarters.

China issued a scathing critique of the way the US dealt with the debt-ceiling, and their rating agency already downgraded US, they eagerly exploited the situation by saying that S&P basically confirms what they already found weeks ago.

US politicians are already scrambling to lay the blame with the 'other' party.

things look quite grim. i hope cooler heads prevail. i will not be holding my breath.

 

[craig1985]

I mean this with all due respect, but I'm so glad that I don't live in America, where the answer to the debt crisis is to raise the debt ceilling, so that the Government can borrow even more money, which will only make things even worse, where the need to raise taxes gets shot down in flames because it's a big crime to raise taxes to actually pull yourself out of the mess, especially from the rich, I mean if you're earning several million dollars a year, paying a bit more in tax isn't going to make much difference at the end of the day, you'll still be able to do everything that can you usually do, it'll never happen in any country, but both parties need to stop the blame game and work together and pull their country out of the mire. The rich don't need tax breaks, the ones on minimum wage do.

I do wonder if things get worse if we'll see riots in American cities like there has been in Athens, and the other day in Madrid. Australia isn't perfect, but there is a reason why this country has avoided going into recession, and be as ****ed as Greece, Ireland, Portugal, Italy, and Spain.

 

[fatandfast]

Saw a couple of clips of GOP teabags talking about Obama's nanny state and how he wants to protect us from everything including incandescent light bulbs. Good try but that went through during the glorious Bush years. I still remember when we went to 1.6 toilets and that was going to change everything, it didn't and everybody just flushes twice so 3 gallons of water are wasted

 

[Amsterhammer]

I was impressed by the clarity and common sense of the following article by Richard Wolff, Emeritius Prof. of Economics at Amherst, first published in his blog. Sadly, the idiot Tea Party Republicans will continue to thwart implementation of the steps necessary to start dealing with this crisis. The world is crying out for firm and decisive leadership, but Obama's hands are tied by an obstinate, self-serving and short-sighted (next elections) Congress. It's all very depressing.

The real risk to US debt's credit rating

For S&P, the downgrade was rational: sooner or later, American taxpayers will rebel against austerity cuts to pay for the crisis

Much verbiage is piling up on what Standard & Poor's downgrading of US debt means. Yet, it matters little that the two other giant rating agencies did not downgrade US debt as S&P did. It is likewise unimportant that all those agencies deserve the bad reputations won when their overrating of securities burst in the collapse of 2007 and took an already unbalanced economy into deep recession. Nor does the downgrade impose major cash costs anytime soon.

The S&P downgrade is important because it clarifies and underscores two key dimensions of today's economic reality that most commentators have ignored or downplayed. The first dimension concerns exactly why the US national debt is rising fast. There are three major reasons for this: first, major tax cuts especially on corporations and the rich since the 1970s, and especially since 2000, have reduced revenues flowing into Washington; second, costly global wars especially since 2000 have increased government spending dramatically; and third, costly bailouts of dysfunctional banks, insurance companies, large corporations and the economic system generally since 2007 have likewise sharply expanded government spending. With less tax revenue coming in from corporations and the rich and more spending on defence/wars and bailouts, the government had to borrow the difference. Duh!

The second dimension concerns the "deal" just agreed between President Obama and the Republicans in Congress. That deal promises further major increases in the national debt in the years ahead. That is because it does not alter any of the three major debt causes listed above. The political theatrics of the two parties reflect the money/power of the corporations and the rich, keeping their tax cuts, subsidies and main government orders untouched. Instead, the two parties pretend concern about the debt, debate only how much to cut government spending on the people, and focus on the 2012 election.

S&P downgraded the US national debt because these economic and political dimensions of the US today guarantee a worsening of the nation's debt. Thus, a basically political problem is looming for those lenders who purchased and now own the debt obligations of the US (that is, Treasury securities). The political problem is this: how long will the mass of Americans accept not only an economic crisis bringing unemployment, home foreclosures, reduced real wages and job benefits, but now also cutbacks in government supports? When will the political backlash explode and how badly may it impact the creditors of the US?

When might that backlash demand that the people's taxes stop going to pay off creditors (corporations, the rich and foreigners) and be used instead for public services that the people need? Exactly that political danger for creditors prompted the rating downgrades for the debts of Greece, Portugal, etc. The same danger has now reached our shores and confronts our nation's creditors.

S&P decided – for reasons good and bad, noble and venal – to say what any reasonable observer knows (given that such backlashes hurting creditors have often happened in recent history). Creditors need to worry about the combination of economic crisis, growing inequalities of wealth, income and power, and political dysfunction that now defines the US. The risks of backlash against creditors rise with the national debt. Not to worry is irrational and dangerous for them. And for us?

 

[on3m@n@rmy]

In the US the long-running worry is over the health of the economy. And the issue that links these two continents' troubles is a lack of political leadership – or, as Mr Prodi succinctly put it in regard to Europe, "a problem of power".

US politicians are already scrambling to lay the blame with the 'other' party.

things look quite grim. i hope cooler heads prevail. i will not be holding my breath.

I do wonder if things get worse if we'll see riots in American cities like there has been in Athens, and the other day in Madrid.

The world is crying out for firm and decisive leadership, but Obama's hands are tied by an obstinate, self-serving and short-sighted (next elections) Congress. It's all very depressing.

The risks of backlash against creditors rise with the national debt. Not to worry is irrational and dangerous for them. And for us?

Well, plenty of highlights in the posts above and I generally agree with all that's been said, so I just brought forth a few key ideas. Things like power struggles, blaming the other parties, cooler heads prevailing, riots in U.S. cities, and how our economies are all linked together (no wonder ppl round the world are on pins and needles). My thought about all these can be boiled down to one thing: the Parties (Reps & Dems) need to work together, forget their political agendas, and do what's right for the country, the people in the U.S. and others around the world. As for riots that's one way to get a message accross, but I for one will be writing my representatives telling them what I think needs to be done. I'd encourage others to do the same if you haven't already. Veni, vidi, vici... basically do something before it's too late.

Edit: thanks all.

 

[Alpe d'Huez]

Exhibit A for what is wrong with this country. This is a democrat.

Meanwhile, Gary Johnson, GOP candidate for President says the Defense budget could be cut 43%. ("The party on the left, is now the party on the right..."). It's a shame that Rick Perry is getting all this attention about running, when Johnson is a Republican candidate with forward thinking ideas and some integrity. This also means I don't expect him to get past New Hampshire in the primaries.

It is a shame the way the parties are all blaming each other, and as we noted a few pages ago, this debt deal really doesn't do anything because the vast majority of it takes effect after the next Presidental election, and Congress is sworn in, by which time they'll just debate and re-write the whole thing all over again. People say the President failed, I said it, and he did. But it seems both parties in both houses of Congress failed us as well.

I agree with the economists out there saying austerity is not the solution to the US problem. Especially when we have something like 12% real unemployment, and 19% underemployment. Plus the giant split in the classes.

As far as riots go, I am predicting large protesting, even rioting, at the GOP convention next year in Tampa. Remember the Chicago Seven in 1968? Get ready. This could also look a lot like the 1999 WTO riots in Seattle. I think the police are going to try to be ready, but be somewhat overwhelmed by the sheer number of people showing up to protest. There are a LOT of broke, bitter, angry people out there who have had it. Plus this has to be a strong focal point for the usual suspects of protestors. The anarchists, black bloc, etc. The Democratic convention is two weeks later, but it could see protests as well.

 

[Anonymous]

A couple of observations;

It's interesting how much increased demand for US Treasuries there has been both last week and after the action by Standard & Poor. So much so that interest rates have actually fallen further. I'm a little surprised by this, but at the end of the day people are looking for safety and the US T (and gold) are where it's at (at least for the moment).

I'm surprised Obama is still supporting Geithner, although it's just more evidence that Obama is waaayy out of his league.

The key to all of this is economic growth (as I've been saying since I've been posting here).

No way Obama gets re-elected now. No way.

There's a very good chance the Dems have now lost the Senate. S&P liked the Cut, Cap & Balance plan and has stated the downgrade would have been avoided with the CC&B plan passing, but once passed out of the house Reid declared it "dead on arrival". That will be very front and center in the 2012 campaign.

Washington DC and our political process (both parties) are absolutely broken... rotten to the core and probably the biggest long-term worry.

Marco Rubio will be President within the next few election cycles.

I'm surprised there has not been more talk of the Mack "Penny" Plan. Probably because it's full of common sense and we all know how little of that there is in Washington DC.

Things we could do to right the economic engine:

Stop any further implementation of Obamacare until unemployment is under 6% and GDP is +3.5% or more for at least 4 consecutive quarters.

Stop any further EPA cap and tax actions/regulations until unemployment is under 6% and GDP is +3.5% or more for at least 4 consecutive quarters.

Tariff all Chinese products imported at the level of what we pay the Chinese in interest. We can not continue to allow the Chinese to manipulate their currency to keep their yuan artificially low. And, yes it will hurt American consumers a little but it will also help American manufacturing.

Lower Corporate tax rate to 10% for 5 years and mandate that Corporations must spend an amount equal to their annual tax in US Plants, people and/or equipment.

Re-write the tax code. Eliminate all personal deductions except the first $50,000 in income (have not done the math, but there would have to be a threshold). Institute a VAT or National Sales Tax (my preference).

Energy is the driver of our economic engine. Period. High energy costs hurt every single aspect of economic growth. We have to go get our own fossil fuels and have a coherent strategy for developing alternative fuels... but right now we to lower the cost of energy really badly.

The Frank-Dodd Financial Regulatory reform act is 2700 pages with hundreds of new regulatory reforms. I've heard it estimated it will cost add more than 9 Billion in cost (compliance) to banks and financial institutions. Probably the wrong time to implement this.

Everyone in the US is a stakeholder is a strong economy. As we are starting to see, our way of life is eroding at a pace nobody could have predicted. There is no one party or person to blame. There have been monumental mistakes made... invading Iraq for example. But, as a concerned American, I think the political gamesmanship must now stop, else everyone in this Country loses. Big time.

 

[Bala Verde]

Although there was relatively good news about job creation in the US, the markets were extremely volatile on Friday. After that bit of positive news the markets rallied, then plunged on near-Euro-collapse news and settled to rally upon news that Italy would firmly deal with its domestic situation. However, with S&P's downgrade of the US over the weekend, there is talk about another round of QE, and a rating downgrade of France, which would shift the burden of saving Spain and Italy to Germany eek, Monday could be carnage on the markets... Despite the fact that many companies were reporting relatively good earnings in there previous quarters.

China issued a scathing critique of the way the US dealt with the debt-ceiling, and their rating agency already downgraded US, they eagerly exploited the situation by saying that S&P basically confirms what they already found weeks ago.

US politicians are already scrambling to lay the blame with the 'other' party.

Told ya... 666pts down. ouch

And it looks like we haven't seen the bottom yet. Perhaps later this month if, and only if, new job reports signal similar or better results compared to last month's will the markets be able to steady themselves.

QE1 and 2 are wearing off; the doped up markets are low on HGH/EPO. Tomorrow the Feds will meet, and since gridlocked DC has failed to stimulate the economy since that tiny bit of stimulus we got in 2008 (?), they'll have a tough decision to make. If they go for QE3 in the next couple of days, we'll see another rally that fizzles in less than 6 months.

Debt reduction talks were really appropriate given the (anemic) condition the US economy was in, unsound fundamentals, a totally unregulated Wall Street that Dodd-Frank still hasn't managed to address and to which DC elites pander for economic advice and donations; 6m lost construction jobs (?); debt reduction and austerity were a little premature. But hey, that was the theme of the mid-term elections, so they got what they wanted...

Given that Obama hasn't presented, or managed to put forward, any significant and comprehensive jobs/growth program, there is no end in sight. Freezing government salaries doesn't help, nor does keeping Geithner employed who is too beholden to Wall street (but hey, he needs a job when he is done, so you can't really blame him)

At least oil prices are down, so unemployed people can cheaply drive out of their ghettoized and foreclosed communities to their non-existent jobs

I am guessing some politicians made a decent amount of money today, wasn't Cantor shorting his positions after the debt reduction deal?

Oh, and BofA looks like it could collapse. ~(16)% down today, facing numerous lawsuits, and no one knows how exposed they are to European debt.

Glad Congress is in recess. So they can't f up a bad day even more.

 

[Alpe d'Huez]

...debt reduction and austerity were a little premature. But hey, that was the theme of the mid-term elections, so they got what they wanted...

Apparently Obama did as well.

Given that Obama hasn't presented, or managed to put forward, any significant and comprehensive jobs/growth program, there is no end in sight.

But has Congress (either party)? I guess the Republicans are hinging their thinking that cutting spending to nothing will either improve the economy, or we should just accept a flat economy. The Democrats it seems, have no ideas right now.

I too think we haven't seen the bottom here, stocks, or the economy, for various reasons we've been discussing over the last few weeks.

As to Obama getting re-elected, who knows? Some days he seems like the only sane person in Washington, and what a sad thought that is.

I'm surprised so many people trust S&P ratings. I mean, they gave the mortgage lending market and Lehman Brothers top ratings until the bloody end. Why didn't Geithner attack them?

SoCalScott, back from the dead. Glad you're feeling better.

 

[Amsterhammer]

.....Everyone in the US is a stakeholder is a strong economy. As we are starting to see, our way of life is eroding at a pace nobody could have predicted. There is no one party or person to blame. There have been monumental mistakes made... invading Iraq for example. But, as a concerned American, I think the political gamesmanship must now stop, else everyone in this Country loses. Big time.

Historically, of course both parties are to blame for allowing the system to degenerate as far as it has, by the constant exploitation of any and every underhand trick, loophole, con job, undue influence, etc. known to political man, all for the purpose of perpetually thwarting the other side, rather than for the purpose of effective or efficient governance. In recent times (this century), everyone on the planet, with the exception of American conservatives, has understood that conservative American thinking has been at the very root of all our current evil.

No need to re-hash just what an unmitigated disaster Dubya was for both the US and the world (except for the very rich, Haliburton, etc.) Finally, a 'progressive', who promises to carry out certain much needed reforms, is elected. The country and the world looks forward with a rare feeling of optimism. But wait, in no time at all.....dang Billy Bob, if that ain't a black man in the White House, now that just ain't right...and he wasn't even born here....and so, outrageous conservative 'opposition' to the leader newly elected by a democratic majority, immediately began.....finally mutating into the abortion that is the Tea Bagger 'movement'. These are the people directly responsible for what we see today. What an achievement it is to be able to mock Obama for being ineffective, after your partisan, small minded, 'little America' agenda thwarted effective government at every turn.

I'm sure that you're not the only Republican to feel that enough is enough - now - after the most despicable, irresponsible and reckless political thuggery in living memory, perpetrated by a relatively small group of radical conservatives, who exploited the possibilities offered by a thoroughly rotten and corrupt system, and successfully held the majority of the country to ransom. Now that you've claimed your pyrrhic victory, it's time to stop. Well done.

 

[Amsterhammer]

I think this excellent article puts much about US politics into proper perspective.

The dysfunction that lies at the very heart of American politics

As the system grinds into catastrophic gridlock, disillusioned voters feel it has less and less to do with their lives

Michael A Cohen
The Observer, Sunday 7 August 2011

Nearly three years ago, on a night of great history, a slender 47-year-old black man who had just been elected to the nation's highest political office offered the American people an optimistic vision for the country's future. Quoting Abraham Lincoln, Barack Obama spoke of national unity: "We are not enemies, but friends. Though passion may have strained, it must not break our bonds of affection."

That night, Obama offered the American people a clear sense of his overriding priority as president – it wasn't just to fix the ailing US economy, provide healthcare for all or end the war in Iraq. But rather, after eight years of political turmoil and disunity, through the force of his personality and political temperament, Obama would, as Lincoln said, "bind up the nation's wounds".

Things have not quite worked out as Obama planned. Even with poll results suggesting that Americans prize compromise and are tired of overt partisanship, the level of division and acrimony in Washington has grown exponentially since Obama took office. The recent debt limit debate is the apogee of Washington's dysfunction: and indicative of a political system that is seemingly incapable of dealing with national challenges. Indeed, whatever one may think of Standard & Poor's recent downgrade of US debt, the ratings agency view that "the effectiveness, stability, and predictability of American policy-making and political institutions have weakened" seems almost self-evident.

How has America been reduced to one party holding a gun to the US economy and the other trading away its political principles to stop the trigger from being pulled? The problem is that the US today has one party intent on utilising government resources as a force for social good and another that rejects any significant role for the public sector. Compounding this collision of ideologies is a populace so indifferent to the workings of their own government that they are unable to choose which model they prefer.

This clash over the proper role for government in the US is one that has defined our national politics for more than a century. But in the last several years this conflict has become an existential one, with Republicans basically abdicating their responsibility to govern. When in power they made little effort to deal with the nation's many challenges. In opposition, and particularly in the two and a half years since Obama took office, they have used the tool of the Senate filibuster and various other procedural impediments to try to stop nearly all Democratic initiatives in their tracks. Whatever legislation passed in the past few years is almost solely a product of Democratic cohesion (an attribute that is generally in short supply) – and a brief window in which Democrats enjoyed a filibuster-proof majority in the US Senate.

From this perspective, threatening economic cataclysm in order to further reduce the size of government, by refusing to raise the debt limit, now seems like an inevitable step in Washington's scorched earth politics. That it forced Democrats to agree to trillions in painful spending cuts without any commensurate revenue hikes shows how successful this strategy of policy extortion can be.

So why do Democrats put up with it? They have little choice. The American political system discourages radicalism and relies on compromise. Yet the violation of even the most customary rules of governance has made such deal-making now nearly impossible. It was once considered a given that, with the rarest of exceptions, a president would be able to appoint his own charges to key policy-making positions; and the debt ceiling was considered an occasionally politicised but generally pro forma exercise. No longer. In a system designed around collegiality, Democrats have few tools in their arsenal to combat the GOP's political obstinacy.

As a result, America is increasingly moving toward a parliamentary system in which politicians, rather than voting along regional lines or in pursuit of parochial interests, cast their ballot solely based on whether there is a D or R next to their name. Such a system might work well in the UK, but in the US, with its institutional focus on checks and balances and the many tools available for stopping legislation, a parliamentary-style system is a recipe for inaction.

What compounds the Democrats' challenge is that they are the party of activist government. When in opposition, they find it hard to use the Republicans' jamming techniques; when in power they feel the almost quaint need to act responsibly. Any scent of scandal or illegitimate behaviour that undermines the electorate's confidence in government in turn undermines the Democrat's brand.

Case in point on the debt: liberals far and wide urged Obama to consider invoking the 14th Amendment of the US Constitution, which suggests that the country's public debt must continue to be paid. As the left argued, this would have resolved the crisis. In a worst-case scenario, Republicans might impeach the president in the House of Representatives, but, as the argument went, wouldn't this be a good way to rally the country around Obama? But such tactical recommendations miss a crucial element; if low-information voters (the vast majority of Americans) look to Washington and see the nation's political leaders arguing about impeachment and constitutional crises that have little connection to their own lives it exacerbates their lack of confidence in government. For many conservatives it would only confirm their irrational belief that President Obama is a power-hungry tyrant.

Thus for Democrats, gridlock is their most pernicious enemy; a point Republicans understand all too well. The more they stop government from operating effectively the more it emphasises their key political narrative that there is no reason to have any confidence in public institutions. Tom Schaller, a political scientist at the University of Maryland, said to me that Republicans understand that if you have a vat of sewage and you pour in a glass of wine you still have a vat of sewage. But if you pour a glass of sewage into a vat of wine, guess what, you now have a vat of sewage. In short, a little political poison can go a long way. So while liberal complaints that President Obama is far too solicitous of Republicans and far too wedded to his post-partisan agenda (all probably true), a reversion to bare-knuckled politics is not necessarily going to make things any easier or better for progressives.

As the Democratic pollster Stanley Greenberg noted in the New York Times, "voters feel ever more estranged from government" and "they associate Democrats with government". More crises in Washington are not going to help that process.

Why do voters put up with such a situation? Polling suggests that the electorate wants their leaders to focus on jobs, rather than the deficit; and work toward compromise, rather than gridlock. So why then do they reward political parties, such as the Republicans, that act decidedly against not only their preferences but also their interests?

The answer lies in the apathy of the American people toward their own government. The ultimate check on Republican nihilism would be voter revolt. But in the last congressional election, voters rewarded unprecedented Republican obstructionism with control of the House of Representatives.

What's worse, voter preferences are often contradictory. Polls suggest that the electorate wants political leaders to cut spending, but then also demand no cuts in any government programme that isn't foreign aid. They want Congress to focus more on creating jobs, but recoil at policies, such as the bailout of the US auto industry or the stimulus package, that did just that. One problem is that Americans have been so inundated with anti-government rhetoric over the past 40 years they seem to have trouble identifying any link between government engagement and a robust economy.

Worst of all, Americans may prefer Democratic policies, but they have little confidence in government's ability to fulfil those promises and then blame both parties for inaction. They are so mistrustful of government and shockingly uninformed about its working that, perversely, via the ballot boxes, they directly contribute to the political stalemate they so regularly decry.

The result is a political system that is perhaps more incapacitated than at any point in modern history.

 

[Anonymous]

Historically, of course both parties are to blame for allowing the system to degenerate as far as it has, by the constant exploitation of any and every underhand trick, loophole, con job, undue influence, etc. known to political man, all for the purpose of perpetually thwarting the other side, rather than for the purpose of effective or efficient governance. In recent times (this century), everyone on the planet, with the exception of American conservatives, has understood that conservative American thinking has been at the very root of all our current evil.

No need to re-hash just what an unmitigated disaster Dubya was for both the US and the world (except for the very rich, Haliburton, etc.) Finally, a 'progressive', who promises to carry out certain much needed reforms, is elected. The country and the world looks forward with a rare feeling of optimism. But wait, in no time at all.....dang Billy Bob, if that ain't a black man in the White House, now that just ain't right...and he wasn't even born here....and so, outrageous conservative 'opposition' to the leader newly elected by a democratic majority, immediately began.....finally mutating into the abortion that is the Tea Bagger 'movement'. These are the people directly responsible for what we see today. What an achievement it is to be able to mock Obama for being ineffective, after your partisan, small minded, 'little America' agenda thwarted effective government at every turn.

I'm sure that you're not the only Republican to feel that enough is enough - now - after the most despicable, irresponsible and reckless political thuggery in living memory, perpetrated by a relatively small group of radical conservatives, who exploited the possibilities offered by a thoroughly rotten and corrupt system, and successfully held the majority of the country to ransom. Now that you've claimed your pyrrhic victory, it's time to stop. Well done.

And how many trillions wasted on the "war" on poverty? There's more poverty in the US after the "war" than before. But I guess the progressive's heart is in the right place. Feelings are way more important than results, no? Try not to get too sanctimonious, there's more than enough blunders and corruption to go around.

We won't agree on much. I will not engage you so I'll leave it at that.

Edit: I missed your implication of racism the first time I read your post. I'm hopeful that comment was not directed my way. Maybe you can clear that up for me.

 

[ChrisE]

.....Why do voters put up with such a situation? Polling suggests that the electorate wants their leaders to focus on jobs, rather than the deficit; and work toward compromise, rather than gridlock. So why then do they reward political parties, such as the Republicans, that act decidedly against not only their preferences but also their interests?

The answer lies in the apathy of the American people toward their own government. The ultimate check on Republican nihilism would be voter revolt. But in the last congressional election, voters rewarded unprecedented Republican obstructionism with control of the House of Representatives.

What's worse, voter preferences are often contradictory. Polls suggest that the electorate wants political leaders to cut spending, but then also demand no cuts in any government programme that isn't foreign aid. They want Congress to focus more on creating jobs, but recoil at policies, such as the bailout of the US auto industry or the stimulus package, that did just that. One problem is that Americans have been so inundated with anti-government rhetoric over the past 40 years they seem to have trouble identifying any link between government engagement and a robust economy.

Worst of all, Americans may prefer Democratic policies, but they have little confidence in government's ability to fulfil those promises and then blame both parties for inaction. They are so mistrustful of government and shockingly uninformed about its working that, perversely, via the ballot boxes, they directly contribute to the political stalemate they so regularly decry.

The result is a political system that is perhaps more incapacitated than at any point in modern history.

This is much more eloquent than I have been trying to put it.....a large swath of American voters are stupid, and the American voters collectively have only themselves to blame for the currrent mess.

Also, in the case of Obama, you get to toss in the other dog whistle of racism to get the truly stupid to lumber to the polls and continue this debacle.

 

[Alpe d'Huez]

...Everyone on the planet, with the exception of American conservatives, has understood that conservative American thinking has been at the very root of all our current evil.

Unfortunately the term "conservative" doesn't mean any more than liberal does. The real root of the problem is unmitigated corruption. The near constant flow of cash into the hands of politicians and the parties that run them, using that cash to buy access for lobbyists. This runs across the board, all parties, nearly all politicians. The few that get in with little campaign finance help are usually so wealthy they are already connected to elite, or whatever voice of dissent they have is drowned out.

Really recommend you read Andrew Bacevich, a "conservative" in the traditional sense I think you'll admire (former Colonial who believes we should get out of all wars, and close half the military bases across the planet).

You also have to take a look at what Obama said versus what he actually pushed for. It didn't take him long at all to actually escalate the troops and involvement in both wars, plus add on Libya. The health care plan he campaigned on was wasted away, and basically is adding another layer of bureaucracy that no one really knows if in 20 years it will cut net costs or not. He allowed the establishment in his own party to waste more away, and it didn't take two years for the backlash to come, and now result in this debt reduction bill, which from nearly I can gather, really does almost nothing but create binds on what changes might actually happen.

In a strange way, the Tea Party is actually beneficial to Obama. The reason being is that as weak as he is, by comparison they really make him look level headed and sane to the average voter. They have the ability to cause so much disruption within the party itself that no matter who the candidate is, they'll potentially be pushed so far to the right they'll end up forced to defend the concept of eliminating the government in near entirety, with no compromise, no matter what.

 

[Amsterhammer]

And how many trillions wasted on the "war" on poverty? There's more poverty in the US after the "war" than before. But I guess the progressive's heart is in the right place. Feelings are way more important than results, no? Try not to get too sanctimonious, there's more than enough blunders and corruption to go around.

We won't agree on much. I will not engage you so I'll leave it at that.

Edit: I missed your implication of racism the first time I read your post. I'm hopeful that comment was not directed my way. Maybe you can clear that up for me.

I was responding to you, or addressing you, purely and simply as the resident member for the 'other side'. My comments about the originally racist roots of much anti-Obama sentiment were entirely general in nature and in no way directed at you personally!

If we're talking about wasting money, I believe that the 'war on drugs' has also eaten up trillions with little lasting effect. Nevertheless, I would suggest that if money is going to be wasted, it is better wasted on a 'war on poverty' than on foreign military campaigns based on lies, or on tax breaks (loss of state income) for the rich and big business, something which is seen as being utterly obscene by the rest of the world.

We do however, agree about the necessity for something like VAT or a national sales tax to raise additional public revenue, though I can just imagine what the reaction of conservative America would be to such an initiative!

 

[Anonymous]

I was responding to you, or addressing you, purely and simply as the resident member for the 'other side'. My comments about the originally racist roots of much anti-Obama sentiment were entirely general in nature and in no way directed at you personally!

If we're talking about wasting money, I believe that the 'war on drugs' has also eaten up trillions with little lasting effect. Nevertheless, I would suggest that if money is going to be wasted, it is better wasted on a 'war on poverty' than on foreign military campaigns based on lies, or on tax breaks (loss of state income) for the rich and big business, something which is seen as being utterly obscene by the rest of the world.

We do however, agree about the necessity for something like VAT or a national sales tax to raise additional public revenue, though I can just imagine what the reaction of conservative America would be to such an initiative!

Fair enough, thanks for the clarification.

I'm not a big fan of the war on drugs either. However, the poverty efforts have had destructive unintended consequences particularly with the inner city poor. So in this sense the results really do matter even if the intentions are honorable.

I'll state this fact again. As far as income tax goes, the Bush plan, when compared to the Clinton plan, produced a couple of things that those who clamor for a higher tax rate for the "rich" either know but don't care or don't know because they are ignorant.... the Bush years produced a higher adjusted gross income (among the top 1%) AND a higher percentage on that AGI collected by the US Treasury with a lower top marginal rate. A LOWER top rate produced what you want... more revenue to the US Treasury to re-distribute. A top marginal cut was in fact a tax increase. This is a fact and, again, here is where results really need to be looked at versus the mantra of the left (the rich don't pay their fair share).

One would think, given the absolute **** we are going through economically, that all of us would get serious about repairing the economic engine and put the rhetoric aside and actually look at what works to drive the economy. But the lines in the sand can't be crossed by either political ideology, or so it seems.

 

[Anonymous]

The Mack "Penny" plan opined by a self described liberal democrat.

But if you are an anti-tax conservative who sincerely believes that you have to cut spending and not "feed the beast" with more revenues, then one approach on spending cuts for the super committee to consider is the simple and creative "Penny Plan" introduced by Rep. Connie Mack (R.-Fla.).

Mr. Mack's bill, H.R. 1848, would cut one-penny-out-of-every dollar actually spent by the federal government from year-to-year for the next six years, from FY 2012-FY 2017. Beginning in FY 2018, there would be a budget cap of 18% of GDP (the average federal revenue as a percentage of GDP over the past 30 years). And by FY 2019 America would finally have a balanced budget -- that is, assuming revenues naturally increase from the current 14.8% of GDP to 18% of GDP by 2019, after which the budget would be in surplus.

There is an automatic spending cut "trigger" under Mr. Mack's plan -- one he came up with well before the trigger used in the recently passed national debt ceiling bill. If congress failed to enact a budget implementing the one-percent-actual-spending cut required under Mr. Mack's measure, then there would be automatic, across-the-board actual cuts in all federal programs to meet the one percent reduction, and that means all: in defense, Social Security, Medicare, Food Stamps, defense and national security spending, everything.

http://www.huffingtonpost.com/lanny-davis/connie-macks-penny-plan-w_b_917649.html

This is the best proposal I've seen so far.

 

[Anonymous]

Fair enough, thanks for the clarification.

I'm not a big fan of the war on drugs either. However, the poverty efforts have had destructive unintended consequences particularly with the inner city poor. So in this sense the results really do matter even if the intentions are honorable.

Wait until you see what happens to them when you end those programs...

I'll state this fact again. As far as income tax goes, the Bush plan, when compared to the Clinton plan, produced a couple of things that those who clamor for a higher tax rate for the "rich" either know but don't care or don't know because they are ignorant.... the Bush years produced a higher adjusted gross income (among the top 1%) AND a higher percentage on that AGI with a lower top marginal rate. This is a fact and, again, here is where results really need to be looked at versus the mantra of the left (the rich don't pay their fair share).

Yea, that's what we have been saying. The fact that conservatives either know but don't care or don't know because they are ignorant...the Bush tax cuts aren't creating any jobs, didn't achieve a lower unemployment rate at any point that was lower than what we had under Clinton, and only accelerated the rate at which the top 5% of income earners grew in percentage of wealth against the other 95%. They are the only group that has increased in percentage since Reagan. So if you want to talk facts and ignorance (willful or otherwise), then I would think you might want to button up on all of the facts.

One would think, given the absolute **** we are going through economically, that all of us would get serious about repairing the economic engine and put the rhetoric aside and actually look at what works to drive the economy. But the lines in the sand can't be crossed by either political ideology, or so it seems.

The fact is that there is no market with which one can sustain a recovery right now, so the whole "the best way to raise revenue is to keep in place tax incentives that are absurd to even people at the Heritage Foundation believes are pointless" is sheer madness. In fact, there are conservative economists EVERYWHERE saying that it is ridiculous to take revenue increases off the table right now IF you want to close the budget gap.

Interesting too that the Teabaggers were willing to remove subsidized student loans for graduate students, but were unwilling to take away subsidies for oil companies...hmm....I wonder who financed the teabaggers in the last election? Starts with a K and sounds like the worlds most popular carbonated soda.

S&P told you that we had to raise revenue, and that from the right, that unwillingness factored into the downgrade. They made clear their disdain regarding the climate in Washington based on the positions of BOTH SIDES of the process. The problem is that the reality is that the Democrats gave much more ground in the process than the Republicans. So really, it is more your fault, sorry.

 

[Anonymous]

The Mack "Penny" plan opined by a self described liberal democrat.



http://www.huffingtonpost.com/lanny-davis/connie-macks-penny-plan-w_b_917649.html

This is the best proposal I've seen so far.

There is no way to close the budget gap without raising revenue. You can close your eyes and wish, click your heels together and say over and over "there's no place like home," or do whatever you like, but the fact is that IF you want to close the budget gap (I don't for one second believe Republicans want to do that. They have never done it before, and for all of the bluster of their rhetoric, their record speaks to the factual nature of their real objectives), you HAVE to raise revenue. Either by raising taxes, or doing away with a myriad of deductions. I heard a guy from CATO admit that last week.

Grover Norquist should be arrested for treason and forced to eat every one of the pledges idiotic lawmakers have signed.

I don't know if you are aware of this, but it is actually possible to institute a budget that has significant cuts to spending and revenue increases that will actually close the budget gap.

 

[Anonymous]

Wait until you see what happens to them when you end those programs...



Yea, that's what we have been saying. The fact that conservatives either know but don't care or don't know because they are ignorant...the Bush tax cuts aren't creating any jobs, didn't achieve a lower unemployment rate at any point that was lower than what we had under Clinton, and only accelerated the rate at which the top 5% of income earners grew in percentage of wealth against the other 95%. They are the only group that has increased in percentage since Reagan. So if you want to talk facts and ignorance (willful or otherwise), then I would think you might want to button up on all of the facts.



The fact is that there is no market with which one can sustain a recovery right now, so the whole "the best way to raise revenue is to keep in place tax incentives that are absurd to even people at the Heritage Foundation believes are pointless" is sheer madness. In fact, there are conservative economists EVERYWHERE saying that it is ridiculous to take revenue increases off the table right now IF you want to close the budget gap.

Interesting too that the Teabaggers were willing to remove subsidized student loans for graduate students, but were unwilling to take away subsidies for oil companies...hmm....I wonder who financed the teabaggers in the last election? Starts with a K and sounds like the worlds most popular carbonated soda.

S&P told you that we had to raise revenue, and that from the right, that unwillingness factored into the downgrade. They made clear their disdain regarding the climate in Washington based on the positions of BOTH SIDES of the process. The problem is that the reality is that the Democrats gave much more ground in the process than the Republicans. So really, it is more your fault, sorry.

So your point is, in the current economy, raising income taxes will do what? Create jobs?

If the goal is increased revenue, then how do you reconcile a higher income among the "rich" along with a higer percentage of that higher income collected in income tax with a lower top marginal rate? Is that not the goal of the progressives?

I don't think the Michael Dell's in this country should be able to take advantage of farm subsidies to lower his taxable income. Close business loss carry-forwards. But also recognize human behavior and what happens when high income earners feel over-taxed. And recognize what happens economically. If the goal is a thriving economy then I don't believe that raising taxes get us there. I could be wrong, but I don't think so.

Too bad we don't have actual leadership in the Oval office. Take a look at JFK and compare to what we have today;

http://www.youtube.com/watch?v=aEdXrfIMdiU

Can you imagine how JFK would be absolutely savaged today?

Tax all personal income over $200,000 and you will wind up with something like 1 Trillion dollars (slightly less, I believe). So additional revenue solves very little. We need the economy back to needing more labor. End of.

S&P told you to balance the budget which was of course declared "dead on arrival" by your side. Yet it's my fault.

Okay.

 

[Anonymous]

There is no way to close the budget gap without raising revenue. You can close your eyes and wish, click your heels together and say over and over "there's no place like home," or do whatever you like, but the fact is that IF you want to close the budget gap (I don't for one second believe Republicans want to do that. They have never done it before, and for all of the bluster of their rhetoric, their record speaks to the factual nature of their real objectives), you HAVE to raise revenue. Either by raising taxes, or doing away with a myriad of deductions. I heard a guy from CATO admit that last week.

Grover Norquist should be arrested for treason and forced to eat every one of the pledges idiotic lawmakers have signed.

I don't know if you are aware of this, but it is actually possible to institute a budget that has significant cuts to spending and revenue increases that will actually close the budget gap.

Okay, you are glossing over how to increase revenue. Bush lowered rates and increased revenue. Reagan lowered rates and incresed revenue. JFK lowered rates and increased revenues.

The only way to increase revenues enough to close the budget gap is to grow the economy.

 

[Hugh Januss]

This is much more eloquent than I have been trying to put it.....a large swath of American voters are stupid, and the American voters collectively have only themselves to blame for the currrent mess.

Also, in the case of Obama, you get to toss in the other dog whistle of racism to get the truly stupid to lumber to the polls and continue this debacle.

That is the funniest line of the last few days in this whole thread.

The discouraging is that the biggest problem we face is the huge disparity in the distribution of wealth and not a single thing that any politician is talking about will have any effect on that, other than helping it along even more.
Lowering taxes on the weathy and cutting entitlements even further will result in only one thing, even more money in the pockets of the wealthy and even less in the pockets of the poor. It will not produce more jobs, maybe a few more maids and anti aging doctors.
Perhaps it is drawing to the point where the only cure is bloody revolution.
Problem? It would never get off the ground because no matter where it started it would immediately be labeled a Communist uprising and opposed by the very people it would ultimately benefit the most.
I'm afraid we are phuked and there is no good way out.