Paying for the Virus

March 31, 2020

In his discussion of the financial consequences of the pandemic to New York, Gov. Cuomo has not mentioned that New York isn’t permitted to borrow the money it needs. The reason is a New York State constitutional prohibition. Many states prohibit borrowing except for capital expenses. When states were permitted to borrow for current expenses, they ran up large debts and the practice needed to be stopped. So, many state constitutions barred the practice. New York requires a law to be submitted to the voters for specific purposes. The Governor does not have the time to satisfy New York’s constitutional rules. For the moment, he’s stuck.

The same prohibition does not apply to the federal government. Economists understand that fiscal stimulus is an important tool for dealing with economic downturns. But clearly the feds have misused it, giving large tax cuts to the wealthiest people and corporations, cuts not used in any way to stimulate the economy but that did significantly increase the national debt. That was the kind of misbehavior that led states to take the power away.

This, however, is an example of a time where deficit spending is completely appropriate. Dealing with the virus is expensive. The feds have provided some relief though politics has affected who got what. But there is an additional problem – with a large part of the workforce ordered to stay home and businesses shuttered, there is a very large downturn in tax payments flowing to government. The federal government can borrow to fill that gap and it can provide relief to the states. But most states can’t help themselves. The result, as usual, is that this becomes another way for Republicans to force everyone to cut what they spend on services – in this case, because the big budget item is education, the feds are forcing states like New York to cut funding on schools. Whoopie – isn’t that great planning for the future.

The Federal Reserve is trying to stimulate the economy but chairman Powell has been very clear that the Fed cannot solve our problems because the financial system is not the main problem, not even close. There are supply side, demand side and income problems. The Federal Reserve’s tools provide little help on the income side. It’s a little too simple to say that the Federal Reserve has no fiscal powers because it can lend to the federal government, but it can’t force the federal government to borrow, or to put that in its budget. So unless Congress and the Administration decide that there is a need to help the states meet the costs of running their school systems and other necessary services, the states are stuck doing what Republicans always want them to do – cut their services to the people. If they do that, then rich folk won’t have to bribe their kids ways into college because only the rich will have kids sufficiently educated to go to college, and all the disparities in America will get even bigger.

Grabbing all the goodies for fewer and fewer people seems to be the dream of those who finance Republican campaigns, but I can’t see why any of the rest of us would accept it – unless Trump pulls the wool so far over people’s eyes that the people don’t understand that he and his Republican friends are using the epidemic to make most of us even worse off than we were before.

This commentary was scheduled for broadcast by WAMC Northeast Report, on March 31, 2020.


Political Dream Team

February 19, 2020

I keep hearing people who should know better, chattering about Democrats not having good candidates for the White House. Just the reverse, there are too many. In fact, each and every one is terrific. Except for primary rules that make them competitors, this would be the political Dream Team ready to wipe away all opposition as if it were the ‘92 Olympics.

 

Elizabeth Warren takes a deep dive into policy questions, driven to figure out what will do the most good for us. Bernie Sanders instinctively connects with young people and working people. Joe Biden and Amy Klobuchar work the room, so to speak, talking and connecting with people to figure out what works. People like Klobuchar, Sanders and mayors Pete Buttigieg and Mike Bloomberg have administrative experience. Bloomberg and Steyer are used to crunching numbers. And all strike me as having their values and ethics in the right place. I’d have said good things about some of those who dropped out too. Truly the party has had an embarrassment of riches, white and black, men and women, from rich and poor backgrounds.

The team has experience in business, finance, working with poor and minority groups, factory workers, farmers, the middle class and those of us we’ve been calling ordinary Americans. It has people rolling up their sleeves to deal with some of the country’s major problems now, not waiting until they get elected.

The problem is the scoring. Instead of giving each voter a single choice, bouncing their preferences against one another, Democrats might have done much better with forms of voting in which voters could list, in order, the candidates they’d support, so their choices could be added together to get the most widely admired candidates.

The Iowa caucuses went part way. They got everyone’s initial preference when they walked in. Then discussions winnowed that down a little. We never saw what would have happened if they’d had to get to 50% plus 1.

I’m not sure that voters are grouping candidates by their place on a spectrum from centrist to liberal rather than whether candidates seem like people they’d be comfortable with. But whatever, we wouldn’t have to eliminate candidates because they didn’t get enough first place votes and we could instead search for agreement on candidates that most of us could be enthusiastic about. A campaign like that could give us candidates who would happily become the Dream Team in office.

To be fair, it is one of the ironies of democracy that every voting system has its flaws. It’s pretty obviously too late to change this year – we’d have chaos if we did. And we might decide to try ranked choice voting on local elections before trying it out on the presidential primaries. Other systems, like cumulative voting, are better suited to legislative elections. There’s room for experimentation.

My major point is that it would be useful if we all started to think about our second choices. I think most of us would find that there’s a lot to like. I’ve had a first choice from the beginning, a woman I’ve met, like and admire. But if you asked me about my second choice, wow, there are a lot of good people and we’d be blessed with any of them – or with them all on the New Democratic Administration Team in one position or another.

— This commentary was scheduled for broadcast by WAMC Northeast Report, on February 18, 2020.


Too Liberal?

February 10, 2020

People claim Elizabeth and Bernie are too liberal, that their projects would beggar the country, so we can’t select them.

There must be something wrong with programs that have existed in Europe for decades. There must be something wrong and beyond our resources, with liberal programs, even though many corporate leaders support them.

Health care? The money is obviously there. People have been buying insurance forever. Employers have been paying for it for decades. And what they wouldn’t buy, the public has been paying for through emergency rooms. Let me explain the real difference. If employers pay their share through the tax system, they won’t have to worry about so-called employee benefits every time they hire someone. Even though corporations would pay about the same, the shift from a payroll expense to a public program would take the cost out of the calculus whenever business thinks about hiring someone. Or thinks about giving people a real job instead of a gig. Public programs help the economy flow. Many corporations understand that. Competition can be built in with a public option, for example. And small business would function much more easily. But false conservatives, playing on the fears of the public, don’t want to admit that they’re behind the logical eight ball.

Business could rarely get going if they had to build their own physical and social services. In fact business always wants the public to give them whatever they need. They don’t even want to build ballparks on their own dimes! But if they had to find and get water to their businesses and workers, or build their own electrical systems off the grid, or cut and pave their own roads, it would cost more and few could get started. They’d be stuck next to waterfalls like the old mills. But that’s what the fear mongers call socialism. And if they had to build all the physical and social infrastructure they need, they’d spend as little as possible and sacrifice the health of their employees. I’m not making that up – it’s the history of company towns that virtually enslaved employees, paying them in what was called company scrip. Complain and you lost your job, your home, and went into the world penniless, homeless and likely without your family as well.

Social investments protect our jobs and our freedom. Americans who know their history know that’s the world that President Franklin Roosevelt rescued us from with the New Deal by the end of the great depression. Some rich folk hated him for it because it gave most of us a chance at decent lives instead of slavery to corporate masters. Now that corporations are finding ways to take it back through the gig economy, outsourcing and union busting, we need to recreate the New Deal that gave us Social Security, unemployment insurance, the right to organize and that eventually led to Medicare. Far from being unsustainable, Americans had their best years since Roosevelt and the New Deal. And corporations too know that they can live with it because public programs give them the flexibility they want to add employees without the added expense of so-called benefits.

Too liberal? Don’t make me laugh through my tears at the ruin of the American worker.

— This commentary is scheduled for broadcast by WAMC Northeast Report, on February 11, 2020.


Is there a Future for Democracy in America?

February 4, 2020

I’ve been writing about gerrymandering and election law since I was in law school, long enough to feel very discouraged. When Anthony Kennedy didn’t take advantage of his last crack at gerrymandering while still on the U.S. Supreme Court, after having teased us for years about his willingness to deal with it, I was sad to the core of my being. Ezra Klein’s “Polarization and the Parties” which came out a week ago in the Sunday Times galvanized my thinking, if not my hopes.

Klein made it clear that the combination of gerrymandering, the allocation of Senate seats and the electoral college would soon leave 70% of America represented by 30% of senators and vice versa, and the electoral college will continue to “elect” presidents who have lost the popular vote. With the Supreme Court continuing to be shaped by those disproportionate advantages in the Senate and the executive, Republicans will continue to be able to stave off a more equitable representation in the House of Representatives. In other words, democracy will be a memory replaced by institutionalized minority rule.

Can we do anything about it? Klein points out that with their power resting firmly on these legal impediments, the Republicans will continue to fight fiercely against anything resembling democracy. Flipping control of the White House and Congress would certainly make a difference but would not change the electoral college, the Senate’s skew toward the least populous states or its grip on Supreme Court appointments.

There’s much talk about amending the Constitution, but that requires three-fourths of the states with the same unrepresentative dynamics to approve. So fat chance fixing the Constitution, whether by amendment or a convention as spelled out in Article V of the Constitution.

Then what? Our Constitution was adopted “illegally” by the terms of the Articles of Confederation. Could we do the same, create a new Constitution and specify, as the Founders did, how it should be ratified. That’s been tried on the state level but met an unreceptive Supreme Court. Could we expect better from this Court? And who’d count the votes? The existing and affected states or some nonpartisan entity? By what method or machine?  And who’d pay? Perhaps we should hire five thirty-eight.com to gather private polls. But we’d be mired in questions of polling methods and ethics.

Maybe we should have let the Confederacy go? Chucking Texas alone would make a big difference – although Texas is changing. Or maybe the coasts should secede. Those alternatives would leave us a smaller, weaker, country, subject to alliances with foreign powers against each other – the biggest fear and reason for action of the people who wrote and ratified our Constitution. Would such a split be like the former Czechoslovakia or the former Yugoslavia, which is to say a peaceful split or a bloodbath? Trump’s “base,” by the way, has been arming itself for that bloodbath for years.

Or maybe some of the 70% of us need to resettle with the 30% and change the country from the bottom up. But on that too, as we’d have said in Brooklyn, fat chance. I think that means that the more we care about the results, the more radical our views, the more we have to roll up our sleeves and work together that much harder on the elections, no matter which candidate becomes our standard bearer.

— This commentary was broadcast on WAMC Northeast Report, February 4, 2020.


Time to Fight Fire With Fire

November 19, 2019

We’re in the middle of a campaign about whether Democrats should nominate a centrist and reject people like Elizabeth Warren and Bernie Sanders, who understand who and what is hurting most people in America – citizens, middle class and struggling, guests, refugees, union members, farmers, and consumers – most of us. Elizabeth and Bernie are the reasonable ones while most others avert their eyes or hold their noses. Three cheers for reasonable, straight talking, clear-eyed candidates.

What should Congress do? Compromise isn’t possible. Republicans can’t even accept surrender if Democrats’ names are on it. Negotiation isn’t possible no matter how much Republicans blame their own intransigence on the Democrats.

Congressional Democrats need to take a page out of the Republican playbook to copy Gingrich, fight fire with fire and refuse to pass essential legislation, including the budget, unless it has everything Democrats stand for and need for the welfare of all of us. I’d insist on language that eliminates any and all judicial seats from the moment the holder dies or leaves – no more appointments for Trump no matter when the election, no more judges who refuse to deal with the unconscionable ways that corporations eviscerate the lives of honest, hard-working people. Unconscionable, by the way, is a legal term that judges refuse to use when ordinary people are being shafted.

What will it do in the presidential campaign? Energize the party. It’s time Democrats stopped gagging themselves to stay closer to the middle, allowing the so-called “middle of the road” to drift further to the wrong, further away from what reasonable, real people need.

We need to stand up for each other, for our friends and our neighbors, for people who care for America, who actually believe in the Declaration of Independence and in the ideology of America, not the weakened and destroyed America that Republicans at the racist, billionaire and Tea Party tables happily let crumble. It’s time to show we really care about the harm that Trump and his lackeys are doing and stop it. No compromise with hatred, racism and the corruption of a selfish official with an ego so weak that he can’t stand truth and resorts to calling everyone else fakers, from scientists to journalists.

Tax cuts for the wealthy are obscene – their tax rates are already a fraction of what they were in America’s most productive times. So-called entrepreneurs don’t stand on each other’s shoulders – they stand on the shoulders of a government that created or financed the most important advances of modern life, from medical discoveries to the internet and the GPS system before making it available to private firms. No, we cannot have a decent or fair country if wealthy egotists can’t stand the idea of paying for decent public education. Yes, we can provide health care for everyone like most of the free world. Yes, we can rebuild our country’s infrastructure before it crumbles and takes America down. No need to worry about the billionaires and their crocodile tears about misnamed “entrepreneurs” who don’t need the rest of us to take care of them and don’t use their tax breaks to create jobs.

It’s time to stand on principle. And let’s be clear – principle is attractive and inspiring. We can help everyone from farmers and miners to doctors, teachers, nurses, truckdrivers and food service workers. It’s time for all of us to stand up for each other and show the selfish rich and their enablers what decency and principle really look like, while we show them the door out of Washington and the state capitals and send them to places where they can live the lives of refugees.


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