“The GOP’s Favorite Government Jobs”: Republicans Didn’t Realize Government Budget Cuts Result In Layoffs

Politico’s Austin Wright has a crazy little story about a spat between congressional Republicans and the Labor Department that hinges on the possibility of mass defense contractor layoffs.

The fight is over whether defense contractors are required to send out notices warning their workers of layoffs that would kick in as a result of the large defense spending cuts due Jan. 1 — aka”sequestration.”

Republicans say yes, citing the WARN Act, which requires large employers to give 60 days’ notice of possible layoffs. The GOP has been chortling in glee at the prospect of such notices going out to every single employee of the largest defense contractors, because the 60-day countdown just happens to arrive four days before Election Day. Because, you know, layoffs are bad, even if they mean Big Government is shrinking.

But the Labor Department says no! Labor’s main argument is based on the reasoning that sequestration is not inevitable — Democrats and Republicans still have time to come to a budget deal that would avoid sharp defense cuts. (Indeed the whole point of sequestration was that the prospect of such cuts was supposedly so drastic that it would force a compromise.)

According to Politico’s Wright, congressional Republicans consider the Labor Department’s decision a “political stunt.” That accusation has a high likelihood of being true, but it seems just a little bit hypocritical coming from Republicans who are hoping that layoff notices timed to be delivered just before Election Day will help their own electoral chances.

And that’s hardly the tip of the hypocrisy iceberg. Buried beneath the surface of this latest example of Washington dysfunction is a basic truth: Government budget cuts result in layoffs. That’s not good during a period of very slow economic growth. And yet, Republicans seem to have little problem when the newly unemployed are teachers or firefighters. But when defense’s ox is getting gored, then it becomes a big deal, and then the layoffs are presumed to be Obama’s fault and thus embarrassing to the White House.

 

By: Andrew Leonard, Salon, August 6, 2012

“It’s August Already”: Will We Ever Get To See Romney’s 2011 Tax Return?

I don’t know about you, but this year I filed my taxes just before the April 15 deadline. Most people do. But if you need to, you can file for an extension from the IRS. That’s what Mitt Romney did. And if you look around the discussion about his taxes, you’ll find that everyone keeps referring to the “two years of tax returns” Romney has agreed to release. But what people don’t mention is that Romney hasn’t actually released two years of tax returns. He released one year, his 2010 return (and even that was incomplete). But we haven’t seen his 2011 return. He keeps saying he’ll release it when it’s ready, but is it going to be ready before November?

In fairness, Mitt Romney’s taxes are really, really complicated. He has so many different income streams and accounts and pass-throughs and roundabouts and double-flipping financial McTwists that it takes a team of accountants to prepare the documents. His 2010 return ran to more than 200 pages. But it’s August. Maybe someone should ask whether the accountants are making progress.

My guess is that for the next three months, every time the question comes up, Romney will say that the return is being prepared, and he’ll release it as soon as it’s ready. And then lo and behold we’ll get to election day never having seen it.

From Romney’s perspective, this makes perfect strategic sense. Nobody seems interested in the 2011 return, so there isn’t much cost to putting it off, and if he does release it, that’ll mean a couple of days of stories about all the interesting stuff it contains. It’s essentially the same calculation as he’s using on the rest of his returns: there’s a cost to not releasing them, but it’s evidently smaller than the cost he anticipates from releasing them. So, voters: No tax returns for you!

 

By: Paul Waldman, Contributing Editor, The American Prospect, August 6, 2012

“Everybody Hates Mitt”: With Naked Ambition, A Pretty Repellent Person Who Just Makes Up Things

This time, it’s personal.

A new e-book from Glenn Thrush and the folks at Politico contains this interesting tidbit concerning Barack Obama’s feelings about Mitt Romney:

“One factor made the 2012 grind bearable and at times even fun for Obama: he began campaign preparations feeling neutral about Romney, but like the former governor’s GOP opponents in 2008 and 2012, he quickly developed a genuine disdain for the main. That scorn stoked Obama’s competitive fire, got his head in the game, which came as a relief to some Obama aides who had seen his interest flag when he didn’t feel motivated to crush the opposition. Obama, a person close to him told me, didn’t even feel this strongly about conservative, combative House Majority Leader Eric Cantor, the Hill Republican he disliked the most. At least Cantor stood for something, he’d say.

“When he talked about Romney, aides picked up a level of anger he never had for Clinton or McCain, even after Sarah Palin was picked as his running mate. ‘There was a baseline of respect for John McCain. The president always thought he was an honorable man and a war hero,’ said a longtime Obama adviser. ‘That doesn’t hold true for Romney. He was no goddamned war hero.'”

A brief digression: as John McCain taught America, you can be a war hero and also be a jerk; the latter doesn’t subtract from the former. But McCain is the one politician who is always defined by the most admirable thing he ever did, even though it happened four decades ago, while most politicians are defined by the worst thing they ever did. In any case, assuming Thrush’s reporting is accurate, it’s interesting to see the famously cool and detached Barack Obama actually displaying emotions.

It’s a reminder that politicians, even presidents, are human beings. If someone was going around the country every day telling anyone who would listen that you sucked at your job, and not only that, you also don’t really understand or believe in America, you’d have to be the Dalai Lama not to decide that that person is, down to his very core, an asshole.

Of course, Mitt Romney is a special case. As Kevin Drum says, “something about the presidency seems to have brought out the worst in him. His ambition is so naked, his beliefs so malleable, his pandering so relentless, and his scruples so obviously expendable, that everyone who spars with him comes away feeling like they need to take a shower.” The fact that Romney hasn’t given us much reason to like him means there’s nothing to counteract the negative reaction we have to the awful person he is as a politician. Different candidates are able to do this in different ways. With Barack Obama it was his inspiring personal story, with McCain it was the war record, with George W. Bush it was his easy-going, friendly manner. The result is that even when we see them engaging in some campaign hardball, we’re able to tell ourselves, “OK, I didn’t like that much, but I realize that he’s basically a good guy.”

Romney doesn’t have an inspiring story (feel your heart flutter at “Son of wealth and privilege grows up to obtain even more wealth and privilege”), and his manner is, shall we say, strained. There have been occasional attempts to use his wife Ann and sons, the interchangeable Tagg-Craig-Turf-Gorp or whatever their names are, to humanize Romney, but it never seems to get very far. So when he makes up things about his opponent or refuses to tell us how much money he has or what he does with it, there’s nothing on the other side of the character scale to counteract the impression voters are left with. The person he is as a candidate is all anyone can see. And that person is pretty repellent. So it’s no surprise that his favorability ratings are extremely low and probably going nowhere but down.

 

By: Paul Waldman, Contributing Editor, The American Prospect, August 8, 2012

“Righteous Tut-Tutting”: The “Missing Evidence” In Romney’s Tax Records

Harry Reid has provoked outrage among liberals as well as conservatives, who seem to believe he has violated propriety by repeating gossip about Mitt Romney’s taxes. The Senate leader says someone connected with Romney told him that the Republican candidate paid no income taxes for a period of ten years. Offended by Reid’s audacity, commentators on the right have indicted him for “McCarthyism” while others on the left have accused him of inventing the whole story.

Evidently the chief complaint against Reid — aside from aggressiveness unbecoming a Democrat — is that he cited “an extremely credible source” who he has so far declined to name. Some journalists have gone so far as to suggest that Reid must be lying because he won’t identify the source.

Despite all this righteous tut-tutting among the great and the good, in newspapers and magazines as well as on television, Reid’s critics simply have no way of knowing whether he is telling the truth or not. From the beginning, Reid himself admitted forthrightly that he has no way of being absolutely certain whether what he was told is factual or not, although he believes the person who said it was being truthful.

Many of Reid’s critics work for news outlets that rely on unnamed sources every day, of course, publishing assertions that range from the mundane to the outlandish. It is hard to see why an unnamed source quoted by a daily newspaper or a monthly magazine – or hidden behind a screen in a TV studio – is more credible than a person whispering in the ear of a United States Senator.

Indeed, several of the news outlets now barking at Reid have suffered their own episodes of scandalous embarrassment due to the exposure of invented sources and quotes (see Jayson Blair, Stephen Glass, etc. etc. etc.) . Yet they nevertheless continue to publish quotes from such unnamed individuals. After all, where else would Reid have learned that this is acceptable conduct?

Meanwhile Romney’s response is to demand that Reid “put up or shut up” – that is, reveal the name of his source. But that would prove nothing. As Reid has pointed out, only the former Bain executive can demonstrate conclusively that suspicions about his tax history are unfounded. Although the irritated Romney retorts that he has “paid a lot of taxes,” his denial won’t suffice as proof either. He could have paid hefty real estate taxes on his various homes and sales taxes on his purchases of cars, car elevators, powerboats, and other luxury goods, among other levies, while paying little or no federal income tax.

Obviously it would be simple for Romney to disprove Reid’s statement, which is unlike McCarthyite accusations that involve someone’s personal associations or state of mind. The necessary evidence is not only within Romney’s possession, but is material that candidates in his position normally release to the public and that the public expects to see. It is material that he previously surrendered to Senator John McCain’s campaign staff in 2008, when they were vetting him for a possible vice presidential nomination. (For now, they are conspicuously silent on the Reid controversy.)

There is a legal doctrine that applies to Romney’s current behavior, as Indiana attorney John Sullivan points out – and it doesn’t place the burden of proof on Reid:

At law, if a person in control of evidence refuses to produce the evidence, then the jury is instructed that there is a presumption that the evidence would be against the party failing to produce. It is called the “Missing Evidence” instruction.

The missing evidence is in Romney’s grasp, yet he insists that he will never produce it. Does anyone need instruction from a judge to make the correct inference?

 

By: Joe Conason, The National Memo, August 6, 2012

“Hurting The Most Vulnerable”: Cutbacks To Unemployment Insurance Came Long Before The Great Recession

You may have heard that we’re in the middle of an unemployment crisis. It’s little wonder that an average of 365,500 people per week made new claims for unemployment benefits over the past month. These high numbers have been straining unemployment insurance programs at the federal and state level, and many states have run out of reserves to pay for them, triggering a reduction in benefits. But this crisis wasn’t inevitable. The pull back in unemployment benefits is just another result of state-level choices to cut taxes at the expense of state spending, spending that could be cushioning the blow of the Great Recession.

States are unable to adequately finance their unemployment insurance programs just when they are most needed not because they were unexpectedly overwhelmed. As a new report from the National Employment Law Project shows, it was because they failed to finance them during the good times like they’re supposed to. Here’s the way it works: federal law requires each state to collect unemployment insurance contributions from employers and deposit them into a state trust fund held in the treasury. During good times, the trust funds accumulate reserves so that claims can be paid out during downturns. This makes the program countercyclical, helping to pump money into workers’ pockets and therefore businesses (via their spending) when times are tough.

The problem is that employer contribution rates vary among and even within states. Not shockingly, business groups turn on political pressure to reduce employer contributions and taxes during good times before the coffers are adequately full. And too many states gave in to this temptation before the recession. As the report notes, “Thirty‐one states reduced UI taxes by at least 20 percent between 1995 and 2005.” Meanwhile, from 2000–09 the average UI contribution rate was .65 percent of total wages, “the lowest in the life of our federal‐state UI program.” That left many of the reserves underfunded, especially when they were called upon to respond to the financial crisis.

And now, of course, the demand for these benefits is at a historically high levels. So what have states done to address the fact that they don’t have the funds to pay them out? The solutions “have tended to focus more on curtailing and reducing benefit payments than on the revenue side of the equation,” the report says. That is, rather than looking at ways to hike taxes or employer contributions to make up the shortfall, most states have cut back on benefits for the unemployed.

Over the past thirty years, lawmakers have eroded long-standing features such as the duration of benefits that were “previously seen as untouchable,” and today’s responses follow that trend. Six states have reduced the maximum duration of benefits below twenty-six weeks, which has been the standard since the 1950s. Other states have put up barriers to benefits, like drug testing requirements and excluding seasonal workers. Several states and even the federal government have limited the number of unemployed workers who qualify, forced skilled workers to accept low-wage jobs and lowered the value of payments. Meanwhile, most states did nothing to raise revenues or “passed token policies that will raise a negligible amount of revenue”—the only states to buck that trend were Colorado, Rhode Island and Vermont.

This may sound familiar. That’s because tax cuts have gotten in the way of other important policies at the state level. As Mike Konczal and I showed earlier this year, a handful of ultraconservative state governments were responsible for the massive wave of public sector job losses the country has experienced during the recovery. But layoffs weren’t the only option for dealing with tight state budgets: many of these states also cut corporate taxes or taxes on high-income earners (or both). Estimates have shown that without these job losses, unemployment would likely be a full percentage point lower than what it is now.

And there’s another fiscally irresponsible choice a number of states have said they’ll be making soon: the refusal to expand Medicaid as part of the Affordable Care Act. The Supreme Court ruling that upheld the law struck down the part that would have all but ensured across-the-board participation, and now at least fifteen governors are indicating that they’ll opt out—despite the fact that the federal government will pick up the tab for the full price of expansion in the early years and 90 percent after that. One study even found that the expansion could actually end up saving these states money. But even if that didn’t pan out, Richard Kim recently made a clear case that there are some pretty painless ways for these states to find the money to expand Medicaid. The only catch? They require raising taxes. Either by undoing some unnecessary tax breaks or raising taxes modestly, the states that are threatening fiscal ruin at the hands of this mandate can actually easily afford what it’ll cost them. Small price to pay when Medicaid saves lives.

So-called “tough choices” aren’t always so tough. Some of the policies that are exacerbating the effects of the recession and hurting the most vulnerable among us have been implemented because states refuse to look at the revenue side of their ledgers. The choices to lower taxes or ignore raising them aren’t made in a vacuum. There are often painful consequences, borne by those who can least afford it.

 

By: Bryce Covert, The Nation, August 6, 2012