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View Full Version : Matt Yglesias dreamed a dream that could not be


Don Zeko
07-26-2011, 11:15 AM
Here. (http://thinkprogress.org/yglesias/2011/07/26/279201/cut-cap-and-trade/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+matthewyglesias+%28Matthew+Yg lesias%29)

I had this dream last night of a sane political debate. The way it started was with a congressional opposition that wanted to use the debt ceiling as leverage for spending cuts and a president who wanted to cement his legacy with an important “grand bargain.” What happened is that the president was happy to agree to substantial spending cuts, but insisted that they be paired with revenue increases. Members of Congress said they were willing to swallow tax hikes as the price to be paid for spending cuts, but they couldn’t go along with the president’s obsession with taxing the rich. Then the president said that he, personally, would be willing to make the tax increase a broad-based — even regressive — one, but there’s no way he was going to be able to sell his base on regressive tax increases plus entitlement cuts.

Then in from the darkness came the Ghost Of The 2008 Republican Party, a substantial minority of which believed that the negative externalities caused by greenhouse gas emissions were a problem and should be priced. Why not throw a little carbon tax or cap-and-trade into the mix? Then we’d be not just averting a short-term economic calamity, we’d be making progress on two important long-term problems.

It’s not going to happen, of course. But while it’s a little perverse that we’ve spent the summer of 2011 focused on the long-term budget deficit rather than the short-term jobs deficit, it’s absolutely insane that we’ve been talking about the long-term budget deficit without talking about carbon pricing as part of the solution. It would, of course, also be nice if more than zero DC reporters had noted that both the Waxman-Markey bill that passed the House last congress and the John Kerry Senate climate proposal were deficit reducers.

I'm periodically struck by the way the various insanities of the Debt Ceiling debate are nested inside each other. I start by thinking that it's crazy not to be increasing spending in the face of over 9% persistent unemployment, but Republicans fanatically oppose it for reasons that don't make sense, so I figure that the pragmatic thing to do is to crazily accept the existing level of spending. But it turns out that I have to contemplate cutting spending because Republicans are both substantively crazy enough to want massive spending cuts and tactically crazy enough to want to force them by taking the debt ceiling hostage. So I contemplate spending cuts, but then I figure that I shouldn't worry because not raising the debt ceiling would be enough of a catastrophe that the Republicans would never actually go through with it, so the Dems can safely call their bluff. But it also happens that Republicans are crazy enough to want massive cuts now, crazy enough to take the debt ceiling hostage to do it, and crazy enough to think that not raising the debt ceiling wouldn't be a big problem, so now I do have to negotiate with terrorists. "Well crap," I say, but if I'm going to negotiate with these people, I should at least get a little something. But then I discover that, even if they are offered mountains of spending cuts and the extension of the Bush Tax cuts, the R's are also crazy enough to torpedo the deal and sink the economy if it contains one red cent of tax increases.

The whole process is kafkaesque, and it becomes more so when the media continues to play its he said/she said dance and the professional deficit scolds continue to pretend that both parties are equally irresponsible. But until I read Yglesias's post this morning, I didn't realize that another side effect of all of this layered crazy is that you forget other ways in which the debate is insane. After all, global warming is distinct from the deficit in that, while both are looming problems that will be disastrous a few years down the road, AGW requires immediate action in a way that the deficit does not, and that AGW abatement also contains a solution to our revenue problems. Refusing to even discuss this is crazy, but its insanity pales in comparison to, say, Michelle Bachmann's claims that default wouldn't be a problem or Eric Cantor's "being Speaker of the House is more important than avoiding a Depression" routine, so it isn't even noticed in our present political climate.

eeeeeeeli
07-26-2011, 02:38 PM
There is a strong element of distrust that Democrats don't actually want a Keynesian response, but rather an excuse to spend. To the extent that it isn't simply ad hominem, or wishful thinking, it's a pretty tangled theoretical proposition, and difficult to separate from paranoia. Unfortunately, it seems this is actually a more common argument than criticizing Keynesian economics on merit. Although I suppose that's a fight that might not be fun to engage on publicly. Especially when Republicans have wedded themselves to something so squishy as supply-side economics for so long. I'm pretty sure finding respected economists who advocate supply-side policy, certainly as broadly as Republicans have interpreted it, is difficult.

The reverse accusation would be that Republicans are using the deficit as an excuse to cut spending. However, so many have actually said as much, including leader Boehner last night, in that they lump recession-related revenue failures and stimulus spending in with long-term Democratic policy goals, choosing not to acknowledge any Keynesian basis.

It seems there is enough substantive disagreement before getting into ad hominem or psychodynamic paranoia, much less accusations of bad faith on either side.

Don Zeko
07-26-2011, 03:51 PM
It seems there is enough substantive disagreement before getting into ad hominem or psychodynamic paranoia, much less accusations of bad faith on either side.

I'm not seeing the ad hominem in my post, nor would I say that people are acting in bad faith. I also don't think it much matters. All I'm saying here is that I'm distressed by the substantive, procedural, and tactical radicalism of the Republican Party on this issue, and even more distressed that their radicalism is proving so politically effective. To make matters worse, the rest of our political infrastructure is proving unable to deal with their fanaticism.

stephanie
07-26-2011, 08:02 PM
I'm not seeing the ad hominem in my post, nor would I say that people are acting in bad faith. I also don't think it much matters. All I'm saying here is that I'm distressed by the substantive, procedural, and tactical radicalism of the Republican Party on this issue, and even more distressed that their radicalism is proving so politically effective. To make matters worse, the rest of our political infrastructure is proving unable to deal with their fanaticism.

I agree with all this. But what is there to do? I kind of see the Dems who are so convinced that this is really all Obama's fault* somehow as being similarly unreasonable or at least having a somewhat different view than me of the risks or willingness of the Republicans to really do what they threaten.

I'm actually not so sure about the last bit, but it's one of those things where when the costs are high enough even a small risk must be avoided. (This, of course, is why insurance companies make money and why people are scared of nuclear power.)

*Yeah, I know I'm injecting a new issue.

stephanie
07-26-2011, 08:19 PM
There is a strong element of distrust that Democrats don't actually want a Keynesian response, but rather an excuse to spend.

I think this is part of it. I think the bigger part, especially when we are talking about the tolerance of the public at large for all this and for the Republicans' position, is that Keynesianism is probably widely accepted by the powers that be in Washington (including many Republican types, including in the Bush administration, for example), but it's not "common sense" to the public. Instead, there's probably a broad sense of "times are bad, tighten our belts" that's hard to overcome. The ironic thing, or something, is that this is related to the problem of recession/depression and why they can become lasting, pretty directly. If the perception of times being bad means we stop spending money, then times become worse and more people get laid off and fewer people have money so more belt tightening happens and so on. And the tax revenues sure go down.

But logical as that all is, I keep hearing perfectly reasonable, somewhat educated, moderate and liberal-leaning people worry about the deficit in these "common sense" or "this is how I keep my budget" kinds of ways that makes me thing it's not surprising that the Republican rejection of Keynesianism is applauded by many. There's a weird moral side to it, too.

Edit: Indeed, I think it's really similar to the discussion you started in one of the diavlog threads about social spending. One view is that this money pays off, since effective citizens work and pay taxes. Better to spend a little and have kids get educated and so on. But the credo is that government spending cannot work. So instead this money gets wasted. That's the same here -- it's not an analysis and rejection of Keynesianism. It's a firm belief that spending cannot work.

I'm pretty sure finding respected economists who advocate supply-side policy, certainly as broadly as Republicans have interpreted it, is difficult.

What's hard is finding anyone who thinks we are anywhere near the problematic bit of the Laffer curve.

It seems there is enough substantive disagreement before getting into ad hominem or psychodynamic paranoia, much less accusations of bad faith on either side.

I didn't see DZ as doing this (as he says), but I think there's a widespread "I know the reality and it is what I want it to be" going on with the Republican base. Not only the bizarre "we can default" stuff and not only the DS "the president can just decide not to pay Soc Sec to old people who won't take drug tests! and let's put fat poor people on half rations for food stamps!" I keep seeing a broader claim that we don't really need to cut entitlements to deal with the cuts. That's just Dem lies. We can just cut that waste and money that goes to Dem interests (those awful, awful Dems, taking money from all us real Americans), and then we are fine. It's completely unrealistic and firmly, firmly believed.

eeeeeeeli
07-26-2011, 11:20 PM
I'm not seeing the ad hominem in my post, nor would I say that people are acting in bad faith. I also don't think it much matters. All I'm saying here is that I'm distressed by the substantive, procedural, and tactical radicalism of the Republican Party on this issue, and even more distressed that their radicalism is proving so politically effective. To make matters worse, the rest of our political infrastructure is proving unable to deal with their fanaticism.
Sorry - I wasn't directing that at you. I meant its prominence in our political debate, or at least rhetoric from politicians. It's so much easier to say the other guy is being stupid, etc. I'm assuming they do it because it works. Or at least it gets more work done in a quick soundbite than a more lengthy, nuanced position.

I see a lot of the intransigence as getting driven by this sort of partisanship. I don't know. Maybe that's being too moderate. I certainly think the general Republican position is off the deep end. But it also seems like a lot of posturing to move goal posts.

Here's a question, if you asked every Republican member of the house how they truly (not politically, but in their hearts) felt about medicare, where would they all fall? My guess is that you'd have a good deal wanting to abolish it if they could. That's a really wide spectrum for one tent.

ledocs
07-27-2011, 07:08 AM
Why is the bhtv coverage of this debt ceiling crisis so weak? You guys all seem to be bigger devotes of the site than I am at this point. What gives?

I look at this in two ways, first as someone who is very concerned about the dollar, because my income is almost entirely in dollars, but I live in the euro-zone, and I don't have a huge store of euros. Second, I look at the broader policy and institutional implications of what is unfolding.

There are about sixty important topics that emerge from this story that are very poorly covered on bhtv. I thought the financial crisis coverage here was very weak, and I said so repeatedly. Now this.

Stephanie, I wonder if it's true that virtually no economists think that we're near the danger point on the Laffer Curve. I don't know. But I'm guessing that there might be some not insignificant subset of economists who look at a total theoretical marginal tax rate of around 50% for high earners in some states & localities and who say that taxes cannot be raised any more without causing more tax flight and tax evasion. The thing is, very few high earners actually pay these rates. Just an empirical question about economists.

I thought WH Burgess had a reasonable take on the politics of this. I think it goes like this. Obama lures Republicans into a phony crisis, in the hope that he can make them look radical and unreasonable and thereby strengthen his very weak hand (unemployment way too high) in 2012. As I said before, I am OK with the strategy if it works, i.e. if there is no default and if he wins voters this way, and not otherwise. But Stephanie does not appear to agree with this interpretation of events, and I'm not entirely sure that Burgess was saying this either.

The politically crucial question, the one in which I am most interested, is this. Is Obama's attempt to frame the issue as one of Republican intransigence on raising taxes on high earners working? And secondly, and related to the prior paragraph, I would like to see an analysis of the reasons for Republican intransigence on raising taxes on the rich. There are three possibilities, essentially. One is that there is a sincere belief, an ideology, that raising taxes on the rich would hurt the economy and reduce job growth. The second is that there is a quid pro quo for campaign contributions. The third is that Republicans believe that framing the issue as a no new tax pledge is at worst neutral for them politically, that Obama's attempt to frame the issue just won't work to his benefit. I suppose a fourth possibility is that the dynamics of the Republican party have created this stance, and that things are out of the control of the party leadership, that the strategy of the Republicans on the no new tax pledge is not a result of rational calculation but of local politics. So my guess would be that all of these things are at work, but I don't have a good sense of the relative weights to be given, and that's where I would look to people who know more about these things than I do, such as people who might in some theoretical world appear on bhtv, to help me out.

The Obama strategy seems pretty clear. If he gets a grand bargain, he wins votes, if he doesn't, and if he can attach some blame to Republicans for hurting the economy, or for being unreasonable, he wins. And he's in trouble, because of unemployment, that's just simply a fact. He's not getting many points for the health-care bill or for the stimulus, that also seems pretty clear to me.

Another very important question. If there were a Republican landslide in 2012, and Republicans ended up controlling both houses and the presidency, would they push again on privatizing Social Security, is there really an appetite for that? Or will they just try to get what Obama apparently already offered on Social Security, reduced indexation, gradual increase in the retirement age, maybe increased means-testing of benefits?

stephanie
07-27-2011, 11:29 AM
I thought WH Burgess had a reasonable take on the politics of this. I think it goes like this. Obama lures Republicans into a phony crisis, in the hope that he can make them look radical and unreasonable and thereby strengthen his very weak hand (unemployment way too high) in 2012. As I said before, I am OK with the strategy if it works, i.e. if there is no default and if he wins voters this way, and not otherwise. But Stephanie does not appear to agree with this interpretation of events, and I'm not entirely sure that Burgess was saying this either.

I don't think Obama is politically stupid (it seems to me that some on the left do), and I think this would be a politically stupid strategy. The reason is related to the points that I made above and that DZ made -- the interpretation that the Republicans are being criminally irresponsible depends on a better understanding of the whole thing than I think anyone expects from the general public.

But if the aftermath proves me wrong I'll be happy.

As for the rest of your questions, I think they are good ones, but I'm not sure where to find clear-headed discussion of them, as opposed to politicized versions which are going to depend on who you ask. I'm not interested in a typical bhtv discussion with Jonah Goldberg giving the spin "from the right" and Jon Chait giving us his views "from the left" -- not sure that that would be enlightening. I know that's not what you are asking for, but I'm feeling cynical.

popcorn_karate
07-27-2011, 02:09 PM
It seems there is enough substantive disagreement before getting into ad hominem or psychodynamic paranoia, much less accusations of bad faith on either side.

it seems you have to be extremely invested in not seeing reality to believe that the republicans are operating in good faith.

McConnel: my number one priority is to make Obama a one term president.

the biggest factor in presidential re-elections: the economy.

Republicans don't want an economic recovery that includes four more years of Obama.

stephanie
07-28-2011, 04:22 PM
The whole process is kafkaesque, and it becomes more so when the media continues to play its he said/she said dance and the professional deficit scolds continue to pretend that both parties are equally irresponsible.

Yet another part of this, one on which the media can be blamed for sloppiness, as well as the Republicans for intentionally misleading, and another reason why I'm pessimistic on the politics of it, is that there seems to be no understanding of the distinction between the debt ceiling issue and the budget. People keep referring to the discussion over the debt ceiling as if it were about approving new spending, as opposed to paying for the spending that has already been passed by Congress. Ordinarily (absent a crisis, like running out of money), the Executive Branch has no authority to refuse to spend money that has been appropriated by Congress.

Yet, we keep getting a framing that this is about whether or not more spending is desireable. See Harkin's post in the new diavlog thread (Rausch/Lowry). The real issue is that the debt ceiling is being used as leverage to force cuts and redo the budget process.

And I know you all know this, but as long as the right can frame this as "the Dems wanted new spending" vs. "the Dems want to meet our obligations and not default" and just casually make moronic claims like that Obama can somehow avoid a default and make all necessary payments (including SocSec) in the absence of an agreement by Congress, they can convince themselves that their followers will understand any disaster to the economy that results as Obama willfully not making payments.

TwinSwords
07-28-2011, 05:07 PM
And I know you all know this, but as long as the right can frame this as "the Dems wanted new spending" vs. "the Dems want to meet our obligations and not default" and just casually make moronic claims like that Obama can somehow avoid a default and make all necessary payments (including SocSec) in the absence of an agreement by Congress, they can convince themselves that their followers will understand any disaster to the economy that results as Obama willfully not making payments.

The polling doesn't look good, either:

http://img200.imageshack.us/img200/3424/stevemw.png

(Source (http://nomoremister.blogspot.com/2011/07/burying-lede-on-that-reutersipsos-poll.html))

stephanie
07-28-2011, 06:16 PM
The polling doesn't look good, either

I'm not sure what the focus on Obama even means, although I would tend to read it like you.

In all the more left-wing commentary on this that I've perused (of which Greenwald's appearance here was a mild example) the majority seems to be furious with Obama and not at the Republicans, which just seems bizarre.

sugarkang
07-28-2011, 06:57 PM
Republicans defy the will of the people and engage in extreme recklessness, Democrats scramble to try to meet Republicans' demands ... and Democrats get most of the blame.
Can anyone point out the logical fallacy here?

Hint:

If the people agree with the Republicans, who is doing the will of the people? If Democrats actually spent some time looking at numbers, cared to try and make it work and made meaningful cuts for the long term.

Bah. You'll never do that, so I don't need to talk about it.

Ocean
07-28-2011, 06:58 PM
I'm not sure what the focus on Obama even means, although I would tend to read it like you.

In all the more left-wing commentary on this that I've perused (of which Greenwald's appearance here was a mild example) the majority seems to be furious with Obama and not at the Republicans, which just seems bizarre.

I don't think it's bizarre. Obama has been too flexible in negotiations and too willing to give in in terms of cutting spending beyond what's reasonable and in not increasing taxes. It's deeply disappointing.

stephanie
07-28-2011, 08:26 PM
I don't think it's bizarre. Obama has been too flexible in negotiations and too willing to give in in terms of cutting spending beyond what's reasonable and in not increasing taxes. It's deeply disappointing.

It's the furious at Obama and not at the Republicans that seems odd to me. I can sort of see the view that Obama could have negotiated better, although I'm personally quite skeptical that being less open to cuts would have made the problem go away or resolve in a better way. The gun -- the threat of default -- is still pointed at the US. But I can't see the willingness to give the Republicans a pass while being furious at Obama. I mean, I guess I get that nothing is expected from the Republicans* and Obama of course is expected to protect SocSec** and stand up for liberal interests and so on, but focusing all the anger on Obama just seems odd in that it grossly overestimates his control here and the power the opposition has.

*Although I actually think going so far would be BS. We do expect something from the Republicans, however we might disagree on policy. Any legislator should be expected to care enough about the US and our financial condition to do what is necessary to pay our immediate obligations, rather than creating an unnecessary crisis and potentially a great deal of harm to the average American and American interests.

**The other issue, although not for this thread, is that there's a large segment who think agreeing to some of the cuts in question are beneficial, and these are not merely the TP nuts, but also a lot of independents and Dems. Greenwald ignored this element entirely in his commentary. I'd probably agree with him that the politics of it are more nuanced than the White House seems to be seeing them -- although I hope I'm wrong -- but it would be nice to actually acknowledge this, instead of focusing all anger on Obama who it seems many think is just selling out liberal interests because it amuses him or because all the secret Muslims at his secret mosque are also secret Republicans. (This is supposed to be somewhat jokey, not bitterly sarcastic, so I hope the tone came across. If not, well, that's why the parenthetical comment.) ;-)

Ocean
07-28-2011, 08:34 PM
I don't know about those who are angry at Obama and not at the Republicans. I don't get it.

But, I know that the angrier people get at Republicans the more important it is that they feel somewhat reassured that Obama and other Dems are going to try as hard as possible to defend their position. So, if they perceive that they are giving away the negotiations, it becomes really disappointing and upsetting.

miceelf
07-28-2011, 08:48 PM
**The other issue, although not for this thread, is that there's a large segment who think agreeing to some of the cuts in question are beneficial, and these are not merely the TP nuts, but also a lot of independents and Dems. Greenwald ignored this element entirely in his commentary. I'd probably agree with him that the politics of it are more nuanced than the White House seems to be seeing them -- although I hope I'm wrong -- but it would be nice to actually acknowledge this, instead of focusing all anger on Obama who it seems many think is just selling out liberal interests because it amuses him or because all the secret Muslims at his secret mosque are also secret Republicans. (This is supposed to be somewhat jokey, not bitterly sarcastic, so I hope the tone came across. If not, well, that's why the parenthetical comment.) ;-)

Honestly, it's not necessary to be THAT jokey. Greenwald apparently has pretty inflated ideas about presidential powers, and there are a set of folks to his left (or whatever) who apparently seem to believe that Obama is, in fact, a stalking horse for republican takeover.

popcorn_karate
07-29-2011, 01:38 PM
I don't think it's bizarre. Obama has been too flexible in negotiations and too willing to give in in terms of cutting spending beyond what's reasonable and in not increasing taxes. It's deeply disappointing.

every day the media meme, even on npr, is that neither side is willing to compromise. Its absolutely infuriating given that the Dems have already bargained away their entire position.

popcorn_karate
07-29-2011, 01:49 PM
Can anyone point out the logical fallacy here?

Hint:

If the people agree with the Republicans, who is doing the will of the people?

the poll says that people agree with the democratic position while still blaming Dem's for the impasse in congress.

can you see why most everybody views you as a complete fucking idiot?

hint: its because you have no reading comprehension and a relentless ideological agenda drenched in your caustic vitriol and a grossly inflated self-regard.

have a nice day,

P_K

sugarkang
07-29-2011, 04:00 PM
the poll says that people agree with the democratic position while still blaming Dem's for the impasse in congress.

can you see why most everybody views you as a complete fucking idiot?

hint: its because you have no reading comprehension and a relentless ideological agenda drenched in your caustic vitriol and a grossly inflated self-regard.

have a nice day,

P_K

Ohhhh. And did you really want me to have a nice day?