Levees Not War

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It’s Time to End This Hostage Crisis

This has gone far enough. Whereas Speaker John Boehner has failed to persuade his own party in the House to support his proposed bill to lift the debt ceiling short-term—which the Senate and the President would have rejected anyway—and whereas there is no Senate bill that the House would pass, and whereas the U.S. is projected to begin defaulting on debt obligations on August 2, the time has come for President Obama to exercise the constitutional (or 14th Amendment) option to raise the debt ceiling by executive order. It is time to end this hostage crisis. Section 4 of Article XIV (14th amendment) of the Constitution reads in part:

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.

The 14th Amendment was passed in the wake of the Civil War to settle matters of wartime debt, while the debt ceiling itself dates back to 1917 when the U.S. was entering World War I. (See “Smash the Ceiling” by James Surowiecki in The New Yorker.)

Former President Clinton, who left office with a projected budget surplus and therefore has debt reduction credibility, has publicly said at least twice that the constitutional option should be used if nothing else works to avert default on federal debt obligations. The Democratic members of the House of Representatives, including minority leaders Steny Hoyer and James Clyburn, have urged the President to use this option to protect the nation’s economic stability and pledged that their members will stand behind him if he does.

Jack M. Balkin, a constitutional law professor at Yale University (and blogger at Balkinization) who has been cautious about the use of the 14th Amendment option, was quoted by the New York Times as saying, “You’re not supposed to hold the validity of the public debt hostage to achieve political ends.” He adds, “Section 4 is a fail-safe that only comes into operation when everything else is exhausted.” President Obama himself taught constitutional law at the University of Chicago, so he is familiar with the arguments for and against. Mostly his administration has stressed the arguments against, which in the opinion of many only weakened his bargaining position against the all-or-nothing Tea Party faction of the House Republicans.

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“Just supposing our national government . . . had fallen into the hands of men loyal to an alien power, then would the people yank the usurpers out of office at once?”

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In 2007 we asked, “Is the U.S. an Occupied Nation?” With the country exhausted by war and the Gulf Coast still struggling to recover from Hurricane Katrina, Bush-Cheney and other Conservatives in High Places regularly showed such indifference, at best, to the well-being of ordinary Americans that it really felt as though the government had been abducted.

Now, with America pushed to the brink of an abyss by an extremist few of those same so-called conservatives—the very ones who drove up the debt in the first place—is it possible that the greatest threats to America’s financial, social, and political security have offices in the U.S. Capitol and are paid $174,000 per year, with benefits?

New York Times columnist Nicholas Kristof thinks so, and in “Republicans, Zealots, and Our Security” he makes the case in convincing detail.

If China or Iran threatened our national credit rating and tried to drive up our interest rates, or if they sought to damage our education system, we would erupt in outrage. 

Well, wake up to the national security threat. Only it’s not coming from abroad, but from our own domestic extremists.

We tend to think of national security narrowly as the risk of a military or terrorist attack. But national security is about protecting our people and our national strength—and the blunt truth is that the biggest threat to America’s national security this summer . . . comes from budget machinations, and budget maniacs, at home.

House Republicans start from a legitimate concern about rising long-term debt. . . . But on this issue, many House Republicans aren’t serious, they’re just obsessive in a destructive way. . . . in their effort to protect the American economy from debt, some of them are willing to drag it over the cliff of default.

(Meanwhile, Huffington Post business editor Peter S. Goodman comes right out and says that the congressional Republicans “are acting like terrorists. . . . willfully and intentionally driving us to the edge of a cliff, using the national interest as a hostage.”)

What is it exactly that these so-called conservatives are conserving?

Nicholas Kristof warns that even the slightest, briefest default could drive interest rates higher—“on mortgages, car loans, business loans and credit cards”—leading to a deeper deficit, purportedly the very thing the House Republicans say they’re determined to reverse. The Congressional Budget Office projects that a 1% rise in interest rates could add more than $1 trillion to borrowing costs over the next 10 years.

Republican zeal to lower debts could result in increased interest expenses and higher debts. Their mania to save taxpayers could cost taxpayers. That suggests not governance so much as fanaticism.

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“We put those pay roll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions and their unemployment benefits. With those taxes in there, no damn politician can ever scrap my social security program.” —FDR, 1941

“. . . if the tax cuts are extended, their cost to the Treasury will be used (again) as a rationale for cutting Social Security, Medicare, health care reform, and other social safety-net programs. As Rep. Peter Welch of Vermont has written in his letter to Speaker Pelosi, ‘Without a doubt, the very same people who support this addition to our debt will oppose raising the debt ceiling to pay for it.’ ”   —From our letter to President Obama in Dec. 2010 urging him to stand against extension of the Bush tax cuts for the very wealthy

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•  If you’ve thought of maybe contacting the White House or your representatives, now would be a good time. • White House e-mail: comments@whitehouse.gov  • Please join us in phoning the White House (202-456-1111) and members of Congress to say “Don’t touch Social Security, Medicare, Medicaid”; let the wealthy pay up for a change. Don’t let Republicans hold middle class and poor Americans hostage when they won’t budge on raising taxes. •  Tomorrow we’ll post a similar letter we’ve been faxing to members of Congress.

Following is an open letter to President Obama that we faxed (202-456-2461) and mailed to the White House this week.

An Open Letter to President Obama

President Obama:

As a former Obama campaign and OFA volunteer, I urge you, do not trim Social Security benefits or raise the Medicare eligibility age when the middle class is already nearing extinction. Only months after extending the Bush Tax Cuts for Millionaires, with the G.O.P. not budging on raising revenues, it is intolerable that you would even think of cutting Social Security, Medicare, Medicaid, and federal pension programs. (And stop calling them “entitlements”: that’s a Republican term.)

Even if these programs are left intact, reducing federal spending by billions or trillions at a time when no other large domestic entity is spending at all will increase unemployment, choke consumer spending, and shrink the economy still further. You seem to be putting a lot more effort toward cuts than toward revenues. Seriously, austerity in a recession? You can’t really want to try the Herbert Hoover–Andrew Mellon route to reelection. I’m urging congressional Democrats to refuse the deal.

The millions who voted for you are begging you to address the nation’s real crisis and launch an ambitious WPA-style jobs program and lower the eligibility age for Medicare and Social Security to 55. That would restore public and investor confidence, and would invigorate this lame, sucking economy. If tax rates were fair, this wealthy nation could afford it. You could help make it happen.

Your reelection would be less in doubt if you gave America’s 15+ million unemployed and the nation’s crumbling infrastructure a comprehensive WPA-style jobs program at least 10 times as aggressive as the ARRA stimulus: public works, transportation (not just high-speed rail), public housing, environmental conservation (think CCC), schools, hospitals. Franklin Roosevelt didn’t wait for Congress: he established the WPA in 1935 by executive order. You could do the same.

You’re trying to make a “reasonable,” “centrist” deal with nihilistic extremists who want the government to shut down and to blame you for it. They don’t even believe in government. Claiming “progress,” you’re leading us straight into the G.O.P.’s chainsaw. Last December, after you asserted your readiness to fight the Republicans “next time,” I wrote to you:

. . . if the tax cuts are extended, their cost to the Treasury will be used (again) as a rationale for cutting Social Security, Medicare, health care reform, and other social safety-net programs. As Rep. Peter Welch of Vermont has written in his letter to Speaker Pelosi, “Without a doubt, the very same people who support this addition to our debt will oppose raising the debt ceiling to pay for it.”

I understand the political rationale for wanting to be seen as curbing the deficit, but any cuts are only acceptable if you follow them up with a really serious WPA-style jobs program. I worry, however, that you really don’t have the stomach for a fight. That’s really, really too bad for the millions of us (many unemployed) who put our faith in you. We, and labor and congressional Democrats, may not be helping you in 2012—or even in 2011.

Yours, etc.

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Burn-it-Down Nihilism Spreads Among Tea-Infused House Republicans

[ cross-posted at Daily Kos ]

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“From fanaticism to barbarism is only one step.” —Diderot

House Republicans laughed a former George H. W. Bush economist out of the room on Monday when he tried to warn them of the dire consequences of a U.S. debt default, according to John Stanton of Roll Call. Stanton says the number of let-it-crash denialists among House Republicans is actually increasing. They think the Aug. 2 deadline is artificial. The Honorable Louie Gohmert of Texas said in a radio interview that the Aug. 2 deadline is only for the convenience of the president so he can have a big Aug. 4 birthday celebration fund-raiser. Freshman Rep. Mo Brooks (R-Ala.) says there’s nothing to worry about: “In fact, our credit rating should be improved by not raising the debt ceiling.” The crazy just keeps on comin’. And the clock—or is it a time bomb?—is ticking. The rating agencies Moody’s and Standard & Poor’s may not wait till Aug. 2 to downgrade the United States of America’s credit rating. Then what?

Congress raised the debt ceiling 7 times under George W. Bush, 18 times under Ronald Reagan. But that was then. There is serious concern in the Republican leadership (in the Senate, for example) that House leaders John Boehner and Eric Cantor cannot control the fire-eating Tea Party members, who distrust them and Senate minority leader Mitch McConnell as RINOs (Republicans in Name Only). The radicals have principles; they don’t give a damn about reelection. Many of them scorn the Senate’s “Gang of Six” plan as a betrayal because it involves revenues and does not cut spending deeply enough.

Self-styled Tea Parties of populist anger at overtaxation and nonrepresentation began to sprout at first spontaneously in 2009 (though maybe their rise should be dated to Sarah Palin’s “goin’ rogue” rallies of late 2008). As the G.O.P. and right-wing self-interest groups including Fox News began to feed the nascent movement with the steroids of corporate money and tactics training to direct their anger against the Obama administration’s health care reform initiative—and then against everything else Democrats were up to—political observers on the right and left voiced misgivings that in dispensing the stimulants, the Koch brothers, FreedomWorks, Americans for Prosperity, and other Dr. Frankensteins were creating a monster that they would not be able to control. (Remember the GOP House members standing on the Capitol building porches waving “Don’t Tread on Me” flags and egging on the Tea Party protesters down below shouting “kill the bill!” as the House was debating the health care bill  in March 2010?)

Republicans “won’t be satisfied until the family is out on the street.”

“I certainly think you will see some short-term volatility. In the end, the sun is going to come up tomorrow.” —Rep. Austin Scott of Georgia, president, House Republicans’ freshman class

The New Yorker’s George Packer begins a Talk of the Town piece (July 25 issue) about the debt-ceiling fight titled “Empty Wallets” with a heart-grieving anecdote of a jobless Florida man whose daughter has bone cancer. Danny Hartzell is packing up the family to move in with a friend in Georgia with whom he has reconnected on Facebook, hoping for a fresh start. After being terminated from his $8.50 an hour job at Target—business is slow—his last biweekly paycheck after taxes is $140. Hartzell is hit by one ax-blow of bad luck after another, mostly in the form of Republican-legislated cuts of unemployment benefits or access to health care (votes cast by men and women who have health insurance).

Turning to the debt-ceiling impasse between Congress and President Obama, Packer compares the struggle as “like members of an ordnance-disposal unit arguing about how to defuse a huge ticking bomb.”

Obama, securely in character, called on all sides to rise above petty politics, acknowledged the practical realities of divided government, and proposed a grand compromise that would lower the deficit by four trillion dollars. According to the Times’ Nate Silver, Obama’s offer, in its roughly four-to-one balance between spending cuts and revenue increases, falls to the right of the average American voter’s preference; in fact, it may outflank the views of the average Republican. . . . 

The Republicans are also securely in character. They’ve rejected everything that the President has proposed, because Obama’s deal includes tax increases and the closing of loopholes for hedge-fund managers and corporate jets and companies that move offshore. Ninety-seven per cent of House Republicans have taken something called the “No Tax Pledge.” . . . Representative Paul Ryan’s ten-year budget plan, which remains his party’s blueprint for the future, would impose a fifty-percent cut on programs like food stamps and Supplemental Security Income, which, as long as Danny Hartzell remains jobless, represent the Hartzells’ only income. By the last day of June, the Hartzells had twenty-nine dollars to their name. The Republicans in Congress won’t be satisfied until the family is out on the street. 

Packer notes that the sociologist Max Weber in an essay on politics as a vocation distinguished between “the ethic of responsibility” and “the ethic of ultimate ends”—between those who act on the basis of practical considerations and those motivated by a higher conviction, acting on principle “regardless of consequences.” They are opposites, but someone suited to a career in politics forges some kind of union of the ethics of responsibility and ultimate ends.

On its own, the ethic of responsibility can become a devotion to technically correct procedure, while the ethic of ultimate ends can become fanaticism. Weber’s terms perfectly capture the toxic dynamic between the President, who takes responsibility as an end in itself, and the Republicans in Congress, who are destructively consumed with their own dogma. Neither side can be said to possess what Weber calls a “leader’s personality.” Responsibility without conviction is weak, but it is sane. Conviction without responsibility, in the current incarnation of the Republican Party, is raving mad. . . . It was Lenin who first said, “The worse, the better,” a mantra adopted by elements of the New Left in the nineteen-sixties. This nihilistic idea animates a large number of Republican officeholders.

Packer concludes with the pessimistic observation that Barack Obama—whom we dimly remember as a man elected president on slogans of “hope” and “change” (our characterization, not Packer’s)—“is now the leading champion of fiscal austerity, and his proposals contain very little in the way of job creation. . . . he no longer uses his office’s most powerful tool, rhetorical suasion, to keep the country focussed on the continued need for government activism.”

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Top photo from the film The Hurt Locker (2008). Bottom: detail of photo by Dorothea Lange for the federal Resettlement Administration, taken in Blythe, California, August 17, 1936. Found at Shorpy.com.

Those intrepid researchers at Think Progress have dug up a headline from Aug. 1, 2001—almost exactly 10 years ago—that shows the long-bleeding fiscal damage done by the Bush tax cuts. Only six months into his first term, after George W. Bush inherited a budget surplus from Democratic president Bill Clinton and Congress passed a $1.35 trillion, 10-year tax cut, the AP reported that “the Treasury Department was tapping $51 billion of credit in order to pay for the budgetary cost of the first round of Bush tax cuts’ rebate checks.”

This headline might have been useful in 2010, when extension of the Bush tax cuts was being avoided by timid congressional Democrats before the midterm elections, and then, afterward, steamrolled to passage by Tea Party–drunken Republicans over a passive Conciliator-in-Chief to the tune of “Kumbaya for Billionaires.” Think Progress observes, “The opponents of the tax cut turned out to be right. The 2001 and 2003 tax cuts combined have blown a $2.5 trillion hole in America’s budget and created deficits stretching on for years.”

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• To see how well the Economic Growth and Tax Relief Reconciliation Act of 2001 and the Jobs and Growth Tax Relief Reconciliation Act of 2003 performed in creating jobs and distributing tax relief among income levels, check out this report from the Center on Budget and Policy Priorities.

• See also “10 Republican Lies about the Bush Tax Cuts” at Crooks and Liars.

Republican-led White House, Congress Built This Deficit

How was it looking four years later? Projections released by the Congressional Budget Office in January 2005 showed that “changes in law” enacted since January 2001 had increased the deficit by $539 billion. The Center on Budget and Policy Priorities found that “in the absence of such legislation, the nation would have a surplus this year” (our emphasis). Tax cuts enacted in 2001 and 2003 accounted for nearly half of the revenue shortfall (see chart below). Although the deficit was blamed on “runaway domestic spending” or growth in the costs of entitlement programs (sound familiar?), in fact by January 2005 tax cuts and defense + homeland security expenditures accounted for 85% of the deficit.

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While we’re either gnawing our knuckles or blissfully unaware there’s a debt ceiling hostage crisis now in its —th week . . . While the putatively Democratic President again invites the Republican House leaders to the White House over the weekend to discuss how the federal budget can be trimmed further to accommodate those gentlemen’s concerns while getting nothing in return for the revenue-starved U.S. Treasury, we thought some relevant amusement might be in order.

In this clip from the mid 1930s, Louisiana senator (and effectively still governor) Huey P. Long uses an old country anecdote about a drummer (salesman) of patent medicines called High Popalorum and Low Popahirum—depending on whether the tree’s bark is stripped from the top down or the bottom up—to describe the difference between “the Democratic leadership and the Republican leadership” in Congress.

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David in our Berkeley bureau, whose last dispatch was about global warming and extreme weather (May 24), observes that the G.O.P. hard-liners insisting on reducing the deficit only by cutting Medicare and privatizing other “common good” safety net programs are simply employing the same old deadly “disaster capitalism” techniques that were revealed by Naomi Klein in her powerful 2007 book The Shock Doctrine:

Truly, an insane situation, but not without precedent. I’ve been rereading Naomi Klein’s book The Shock Doctrine, and this is pure simple disaster capitalism following the template: use the bludgeon of national debt to create a crisis, erase progressive history and shred the social safety net, then firebomb the populace with austerity to remake the world for elites and the investor class. It’s quite extraordinary how out in the open this is, but how little it’s talked about. That’s what Obama and the Democrats should be trumpeting about the right wing extremists, who must be taking huge amounts of hidden money from people like the Kochs and FreedomWorks, Rove’s machines, Rupert Murdoch of Fox News, and other sources (and who knows what other hidden promises have been made to them to make even previously reasonable people turn 180 on their own positions). But of course, the Dems wouldn’t utter these words because of their timidity about being called “liberal” or inciting “class war.”

The shock doctrine can be summarized as the deliberate exploitation of the public’s disorientation after a crisis (natural disaster, political upheaval, or economic turmoil) to push through free-market economic shock therapy disguised as “reforms.” The traumatized public is too concerned with basic survival to notice what “the authorities” are doing.

Naomi Klein traced the shock doctrine’s use by U.S. conservative economic advisers and policymakers—always closely linked to profit-ready corporate interests—from the U.S.-supported coup that overthrew Argentina’s Salvador Allende in 1973 to the (Iraq) Coalition Provisional Authority’s efforts to “corporatize and privatize state-owned enterprises” after the U.S. invasion in 2003 to the privatization of formerly public institutions of housing and health care in New Orleans after Hurricane Katrina in 2005 (among a dozen or more other grim “success stories”).

The shock doctrine is alive and well in the U.S.A. Paul Krugman pointed out in February that Wisconsin governor Scott Walker was using shock doctrine methods in stripping away labor unions’ collective bargaining rights in the name of fiscal discipline. Now, when Walker took office on Jan. 3, Wisconsin had no budget crisis. But there was a big deficit after his first legislative priority as governor: giving Wisconsin corporations some $140 million in tax breaks.

What’s happening in Wisconsin is . . . a power grab—an attempt to exploit the fiscal crisis to destroy the last major counterweight to the political power of corporations and the wealthy. And the power grab goes beyond union-busting. The bill in question is 144 pages long, and there are some extraordinary things hidden deep inside.

Shock Therapy by Flood, Eviction and Taser

Most odious to us is the shock doctrine’s use after Hurricane Katrina with the demolition of undamaged, structurally sound housing projects in New Orleans and the shifting of the city’s over-stressed, under-funded public school system to a charter schools model, though as usual without adequate funding. The demolition of the New Orleans housing projects, at a time when displaced, returning residents could least afford the rising rents and housing prices, was an acceleration of a scheme long planned by the U.S. Department of Housing and Urban Development. (See “Homeless for the Holidays: Who Would Jesus Evict?”) It has been alleged, quite credibly, that the destruction of the housing projects was part of a deliberate policy to shift the city’s population back toward a whiter complexion. As Naomi Klein wrote in “Shock and Tasers in New Orleans” at the time of the evictions and demolitions:

Readers of my book The Shock Doctrine know that one of the most shameless examples of disaster capitalism has been the attempt to exploit the disastrous flooding of New Orleans to close down that city’s public housing projects, some of the only affordable units in the city. Most of the buildings sustained minimal flood damage, but they happen to occupy valuable land that make for perfect condo developments and hotels.

The final showdown over New Orleans public housing is playing out in dramatic fashion right now. The conflict is a classic example of the ‘triple shock’ formula at the core of the doctrine.

First came the shock of the original disaster: the flood and the traumatic evacuation. Next came the ‘economic shock therapy’: using the window of opportunity opened up by the first shock to push through a rapid-fire attack on the city’s public services and spaces, most notably its homes, schools and hospitals.

Now we see that as residents of New Orleans try to resist these attacks, they are being met with a third shock: the shock of the police baton and the Taser gun, used on the bodies of protestors outside New Orleans City Hall yesterday [12/21/07].

Perhaps the most notorious and lethal application of disaster capitalism in New Orleans has been the closure of Charity Hospital, which was only superficially damaged by the storm (the basement flooded), so that LSU could build a new Medical Center complex several blocks from the still sturdy mid-1930s building on Tulane Avenue. Charity was long the central trauma unit in the city and the surrounding area. For watchers of HBO’s excellent series Treme, set in post-Katrina New Orleans, disaster capitalism is embodied by the opportunistic characters Nelson Hidalgo, a carpetbagger from Dallas, and C. J. Ligouri, a native New Orleanian who helps guide Hidalgo through the city’s byzantine business and political relationships. See the sharp and spicy comments at the Back of Town blog to which (we’re happy to disclose) quite a few of our friends contribute.

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“In the new code of laws which I suppose it will be necessary for you to make I desire you would remember the ladies, and be more generous and favorable to them than your ancestors. Do not put such unlimited power into the hands of the husbands. Remember all men would be tyrants if they could.”

—Abigail Adams, letter to John Adams, then in Philadelphia, March 31, 1776

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On holidays we like to take a break from our often critical attitude about “what fresh hell” is breaking forth and to say something affirmative about the meaning of the day and why it is celebrated.

Everyone knows that the Fourth of July, which we prefer to think of as Independence Day, celebrates the new United States of America’s (declaration of) independence from Britain. This is true, and this is good.

But, today, after reading that the median pay for a CEO of the top 200 corporations in the U.S. is $10.9 million—$10.9 million for a single individual—up 23% since 2009 (how many jobs could that money create when the unemployment rate has exceeded 9% since May 2009, with at least 15 million lacking any job at all?) . . . and knowing that Congress in its wisdom recently extended the reduced (35%) rate of taxation for those millionaires (rather than let it return to 39%), a reduced taxation that continues for the 10th year to starve the national treasury of desperately needed revenues . . . and while as a related result “leaders” of a purportedly serious and fiscally responsible political party insist in budget deficit talks that revenue increases of any kind are “off the table” . . . Then we have to ask what freedom and what liberty do the ordinary people of this nation have anymore?

Are we the people free from corporate dominion? Are the press and the airwaves free? Are the 15+ million unemployed free to work and earn a living wage? Are the young graduates of our schools free to find jobs worthy of their skills and intelligence? Are workers free to negotiate with employers about their wages and working conditions? Are we citizens free to see a substantial portion of our tax dollars go to education and social safety net programs like health care assistance and Social Security? Are we free to say that the tax dollars we’re compelled to pay will not go to the wars that a majority of the population wants to end? Are women free to determine their own reproductive choices without shame or criminal prosecution? Are their doctors free to advise them simply on the basis of medical science?

Truly it seems that a different form of servitude—or maybe there’s another word for it—has taken hold of this country while a hypnotized, narcotized, War-on-Terror-ized populace is reminded constantly of “our freedoms.” Would these be the same freedoms for which American soldiers who can’t find a job anywhere else are sent to fight in tour after tour of duty in three simultaneous wars, then are brought home, if not in a box, to fend for themselves for jobs and health care?

Just askin’.

But on a more positive note, which we really do want to strike: We do sincerely tip our hats (we wear several) to salute those brave patriots of the Revolutionary War, and to the Founding Fathers who composed the Declaration of Independence and the Constitution of the United States—but also to the Founding Mothers we rarely hear about, such as Abigail Smith Adams (1744–1818), aka Mrs. John Adams.

Particularly in a year that has seen, “from sea to shining sea,” systematic and relentless efforts by state and federal legislatures to strip away the rights of workers and voters, and rape-like assaults on women’s reproductive freedoms—and when a couple of women are campaigning for the presidency even though they appear not to believe in the idea of governing, or of learning—some passages from the wise Mrs. Adams are worth pondering, and practicing, enacting.

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