I Like Paying Taxes – With Them I Buy Civilization

Paul Krugman points a cautionary tale about small government: Colorado Springs.

COLORADO SPRINGS — This tax-averse city is about to learn what it looks and feels like when budget cuts slash services most Americans consider part of the urban fabric.

More than a third of the streetlights in Colorado Springs will go dark Monday. The police helicopters are for sale on the Internet. The city is dumping firefighting jobs, a vice team, burglary investigators, beat cops — dozens of police and fire positions will go unfilled.

The parks department removed trash cans last week, replacing them with signs urging users to pack out their own litter.

Neighbors are encouraged to bring their own lawn mowers to local green spaces, because parks workers will mow them only once every two weeks. If that.

This is just one of the many reasons Congress and the President need to pass a second stimulus plan aimed at filling gaps in the budgets of state and local government. Every government job lost at the local level represents not just another family without an income, but also a gap in the essential services relied upon by everyone else in the community.

Published in: on February 3, 2010 at 11:58 am  Leave a Comment  
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LA Times Opinion Round-Up

Today is Los Angeles Times intensive.

On high-speed rail. The Times appears to misunderstand the concept by complaining that the current federal funding for high-speed rail is debt financed, as part of the stimulus bill. Debt-financing is half the point. On the other hand, their point about gas taxes being insufficient for current infrastructure is valid, and is why I’ve previously discussed the need for mileage taxes, allowing gas taxes to be shifted toward clean energy investment and climate change mitigation. Of course, that the Secretary of Transportation was talking about mileage taxes over a month ago goes unremarked upon.

On torture. The Times nails the description of the memos, “Orwellian horrors”, and rightly calls for Obama to close a loophole suggesting that the CIA might not be bound by the Army Field Manual. However, I fail to see how that could possibly be seen as being “in the same spirit” as announcing CIA operatives wouldn’t be subject to war crimes prosecutions. And, of course, how the Times could endorse that announcement after reading the memos is baffling. But the Times has been weak on the prosecution issue all along. In a classic example, in a point-counterpoint discussion of prosecutions, both sides argued against prosecutions. Good job picking a diversity of opinions.

Tim Rutten on a truth commission. While I agree that a full report on whether actionable intelligence was gained from torture is necessary, we also need to determine the full scope of law breaking and what, if any, sanction is received from Congressional leadership. More importantly, we already know that torture didn’t work on Abu Zubaida – apparently Rutten missed that article. Of course, torture’s unreliability as an interrogation technique has been known for almost 400 years in the West as that appears to have been missed by almost everyone over the past eight years.

As an aside, Rutten’s ongoing opposition to prosecutions (he once referred to the decision to torture as a “policy difference”) should give the lie to his claim of being a civil libertarian. That, or he is too cowardly to stand far enough outside of the mainstream media to call for them.

Calvert on the Stimulus

The DCCC has named Congressman Ken Calvert (CA-44) to the House Republicans Hypocrisy Hall of Fame for taking credit for stimulus spending to occur in Riverside.

Representative Ken Calvert (CA-44) – “All of us in the Inland Empire will do what we can to direct as much money as we can.” [The Press Enterprise; 2/13/09]

We can, of course, compare this to other statements by him, also quoted in the Press Enterprise.

On February 3rd, in response to the DCCC launching ads attacking him for voting against the initial House version of the bill:

“It’s a boondoggle,” Calvert said. “The more people that know I voted against that bill, the better.”

I couldn’t agree more. And on February 12th, when his e-verify amendment was striped out of the bill in the conference committee:

“The one candle in the darkness of this disastrous bill was the reauthorization and requirements to use E-Verify,” Calvert said. “Now all we are left is a bill that places illegal immigrant interests above those of hard working American families and leaves the bill at the foot of future generations.”

All of this is rather surprising, as Calvert is a big fan of infrastructure spending, especially when it is going to benefit his personal financial interest.

As an aside, Bill Hedrick sent out a fundraising email for his 2010 campaign at the beginning of the month, touting the DCCC’s involvement in the district this time around. I’m pleased to see both Hedrick and the DCCC looking forward.

Efforts also appear to be underway by third parties – my parents received a phone call last week from Working Families First urging them to call Calvert and ask him to vote for the stimulus package. The more attention paid to Calvert, the better.

Published in: on February 18, 2009 at 10:23 pm  Leave a Comment  
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How to Vote on the Stimulus?

From the point of view of most economists, it appears the stimulus package is both too small and misspent. The question is, then, should Congressional Democrats vote for it?

From The Hill (via Firedoglake):

Liberals in the House are already making noise that they might vote against the conference bill if it mirrors the Senate legislation.

Rep. Ed Pastor (D-Ariz.), a member of the Congressional Progressive Caucus, said last week, “Many of us may not support it in the House” if the Senate makes “so many changes,” such as adding more tax breaks and cutting spending provisions, which is what the Senate did.

I certainly understand their position – I’m furious with the spending cuts that were made and tax cuts that were added in the Senate, although I think the House bill was also too small. However, on the otherside you have economists.

Here is Paul Krugman:

Today Sen. McCaskill asks whether the Senate stimulus, as negotiated, is better than nothing.

Yes, it is — and if it comes down to that choices, a yes vote is the right thing to do.

But let’s not have any illusions about what just happened. The centrists went to work on a bill that, perhaps inevitably, was a mixture of economic muscle and useless fat; as the price of their support, they cut deeply into the muscle while leaving all the fat in place.

And Brad DeLong has a roundup of others, many who argued for more tax cuts, but say the bill needs to be passed regardless.

Personally, I don’t think a liberal revolt in the House would be productive, as much as I’d personally like to see it. I’d rather see a strong effort in the conference committee. The stimulus is so necessary that I don’t believe this is the time for this fight. Instead, I’d like to see the House add more stimulus spending at points further down the line, and fight the Senate, or the President, over those.

Published in: on February 10, 2009 at 12:52 pm  Leave a Comment  
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Stimulus, What Stimulus? (Updated)

Here is Paul Krugman’s very initial take on the Senate stimulus package (emphasis added).

Now the centrists have shaved off $86 billion in spending — much of it among the most effective and most needed parts of the plan. In particular, aid to state governments, which are in desperate straits, is both fast — because it prevents spending cuts rather than having to start up new projects — and effective, because it would in fact be spent; plus state and local governments are cutting back on essentials, so the social value of this spending would be high. But in the name of mighty centrism, $40 billion of that aid has been cut out.

My first cut says that the changes to the Senate bill will ensure that we have at least 600,000 fewer Americans employed over the next two years.

Every state in the country is facing serious cuts in services over the next few years. In some cases, this means reduced health care or unemployment benefits. In many, layoffs of state employees. California is among the hardest hit in the country, and had its first unpaid furlough this past Friday. The furlough has the effect of lowering employees’ salaries by over 9%. All of these cuts and layoffs have the effect of pulling more money out of the economy, worsening the recession.

The bill is bad, and the blame for it largely rests with President Obama. Certainly, House Democrats deserve blame for larding the bill up, giving Republicans the chance to attack it, and the Senate deserves a healthy dose of blame for passing this milquetoast monstrosity. However, President Obama’s failure to lead on the stimulus is the real problem. He could, and should, have presented a list of demands to the House and used his serious popularity to force it through relatively unchanged. An additional future stimulus, negotiated more fully in the Congress, could have been passed in six months or so, giving Congress the opportunity to pursue its pet agendas.

A large part of his failure to lead is his obsession with bipartisanship. He attempted preemptive compromise with Congressional Republicans, which weakened the bill from the very beginning. He refused to make an aggressive, public case for a large, spending-oriented stimulus, giving Republicans cover to 1) vote against it and 2) hold it hostage. And, finally, he backed Congressional Democrats into a corner where if they didn’t weaken the bill to fit Republican sensibilities they would be seen as going against the highly charismatic and popular leader of their party. A bad move all around. I only hope than in 6 months we have the opportunity to revisit a second stimulus package – this one better designed. I also hope that California’s government lasts that long.

Update: Brad DeLong has the list of spending cut from the stimulus. What the hell was the Senate thinking?

Published in: on February 7, 2009 at 4:40 pm  Leave a Comment  
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California and the Stimulus

There are a couple of interesting stories on the stimulus package and California today. Starting with this one (h/t Calitics):

The Democratic Congressional Campaign Committee (DCCC), chaired by Congressman Chris Van Hollen, today announced the DCCC is launching a Putting Families First ad and grassroots campaign in 28 targeted Republican districts.  The ads focus on the Republicans out of step priorities by putting bank bail outs and building schools in Iraq before the needs of the Americans in the struggling economy.

Targeted California Congressmen include:

Representative Dan Lungren                         CA-03
Representative Elton Gallegy                         CA-24
Representative Ken Calvert                            CA-44
Representative Brian Bilbray                         CA-50

I’m especially happy to see Calvert targeted. I campaigned for Bill Hedrick in the past election and was pleasantly surprised to see how well he performed. I don’t expect that the ads will target the Orange County part of the district. I do think, however, that Hedrick will have to work to tighten the gap in Orange County if he wants to be able to win.

Update: This is exactly the kind of action the California Democratic Party should have taken this summer with regards to Republican obstructionism on the budget. It is still what they should be doing now – but this summer it could have yielded dividends in the election. The state party should take note.

Moving on, I don’t often have good things to say about Senator Feinstein, but I’ll give her credit for this (from CQ):

The first amendment scheduled for debate is a proposal from Patty Murray , D‑Wash., and Dianne Feinstein, D-Calif., that would boost the bill’s highway funding from $27 billion to $40 billion and its transit funding from $8.4 billion to $13.4 billion.

This is a needed amendment. The stimulus package is already weighted too strongly toward tax cuts and too small overall. Infrastructure and transit spending will help put shovels in the ground, and transit spending in particular will help advance us toward a cleaner economy. Personally, I think this stimulus package should be used much more heavily to advance the serious investment we need in clean energy.

Which is part of what makes this so disappointing:

Friends of the Earth tells Streetsblog San Francisco that Senator Barbara Boxer’s staff has confirmed that Boxer and Senator Inhofe will present an amendment to the federal Stimulus Plan for $50 billion in additional funding for highways, bringing the total to $80 billion, exactly the figure Inhofe demanded last week in a letter to the Committee for Environment and Public Works.

I’m all in favor of more infrastructure spending, and this post doesn’t indicate what the spending will be used for. There are certainly any number of highway and bridge repairs that are desperately necessary. However, I dislike seeing spending going to car-based transit and not a corresponding amount going to mass transit. Unlike others, I’m not as bothered by the cooperation with Inhofe, no matter how odious I think he is.

Finally, LA Mayor Villarigosa is going to lobby Congress for more mass transit spending for LA.

Villaraigosa wants to ensure Los Angeles remains high on the list for funding for major transportation, green-energy projects and big-ticket items such as the “Subway to Sea” as well as the mayor’s ambitious solar initiative. He also wants federal money to go directly to cities.

This may be a day late and a dollar short. The time to do this would seem to have been a week or two ago when the core of the bill was still being written. That said, I certainly believe more money needs to be spend as aid to state and local governments. Such spending may not necessarily create new jobs, but it can certainly help prevent current jobs from being lost. And when jobs are lost, the quality of government services degrade, just as more people come to rely on those services. It is a dangerous cycle of events.

Finally, one of the major objections to more infrastructure spending, and mass transit spending in particular, is that it wasn’t sufficiently ‘shovel ready’. On that subject I point to this post by Paul Krugman last week, where he argues that stimulus spending should probably continue through 2011. I am all in favor of a broader spending package even if the jobs won’t get underway immediately, especially if the spending is on projects that advance other goals, such as combating climate change. Of course, perhaps that spending should be in a stimulus round two package that can be more carefully assembled in the next couple of months.

More Good Sense from Paul Krugman

On stimulus bipartisanship:

You see, this isn’t a brainstorming session — it’s a collision of fundamentally incompatible world views. If one thing is clear from the stimulus debate, it’s that the two parties have utterly different economic doctrines. Democrats believe in something more or less like standard textbook macroeconomics; Republicans believe in a doctrine under which tax cuts are the universal elixir, and government spending is almost always bad.

Obama may be able to get a few Republican Senators to go along with his plan; or he can get a lot of Republican votes by, in effect, becoming a Republican. There is no middle ground.

We should stand our ground and pass the best stimulus package possible. Republican ideals have run the economy, more or less, for the past eight thirty years. Why should we still be listening to them?

Published in: on February 3, 2009 at 1:04 pm  Comments (2)  
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Economics and the California Republican Party: Never the Twain Shall Meet

This is a monumentally bad idea.

While many of the funds pegged for California would immediately help children, the poor and commuters, some Republican state lawmakers argue that the state should sock away some of the money for hard times in the future.


Villines agreed that avoiding costly borrowing would be prudent. But he had other ideas about using federal funds. Any federal money that “we might get should basically be put away into a … rainy-day fund for any potential future deficits if the economy continues to get worse,” he said, “as opposed to any budget factoring now.”

The purpose of the money is to stimulate economic recovery now, not to hoard it for the future. Apparently, statehouse Republicans don’t know the meaning of the word ‘stimulus’. The state Republican party should be disbanded, unless and until they can find people who know what they are talking about.

Finally, let’s look at this reporting:

One silver lining in the state’s deep fiscal crisis is that it has forced Republicans and Democrats to consider policies they had ardently opposed in the past, such as taxes and spending caps, experts say.

Which experts say that? Did you make that up, or are there really people who think that this kind of manic crisis budgeting is a good thing? Spending caps are a dangerously bad idea, as usually proposed. This is especially true if they are unable to account for population growth. New taxes are necessary, but Republicans have only willing to offer them in exchange for a spending cap.

The true silver lining of this crisis is that it may provoke the kind of massive structural reform the budget process needs: the abolition of the 2/3rd requirement for both the budget and taxes and the reconsideration of proposition 13; without both of which, we would not be in a crisis this severe. Unfortunately, it would be better to deal with this issues in the sober light of day, rather in the midst of a meltdown.

The “Benefits” of Bipartisanship

There are times for bipartisanship. There are issues on which members of both political parties agree, and sometimes those issues produce landmark legislation. There are also times when, like in diplomacy, compromise is necessary to achieve anything at all. However, I am convinced that bipartisanship for bipartisanship’s sake is not a virtue.

Without getting excessively Hegelian, I believe that there is an element of truth in the operation of a dialectic, especially regarding the reform of government. Where honest debate and honest intentions exist, a conflict between different reforming priorities should produce a synthesis containing the best of each world view. This is largely the dynamic that drove the British reforms of the 19th century, which expanded the franchise, introduced labor laws, and created the beginnings of a social safety net (see footnote below).

Unfortunately, bipartisanship, especially the version practiced in America whereby Democrats water down their principles to attract (unnecessary) Republican votes, preempts this dynamic. Years of milquetoast Democratic rule neither corrects the excesses of the previous Republican rule, nor does it sufficiently advance the goals of progressive ideology to allow for a true synthesis. The result is a political system in which the ‘centrist’ point of view is inexorably pulled to the right. I do not believe that this reflects the viewpoints of Americans in general, but rather the scope of ‘permitted discourse’ as represented in the media (see this wonderful discussion of this phenomenon here.) This then shapes the world view of the next generation.

All of this goes to say that I am very disappointed in President Obama’s approach to passing the stimulus plan. More on the flip.


Published in: on January 29, 2009 at 9:44 pm  Leave a Comment  
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Speaking of Stimulus

I wholeheartedly agree with this.

California’s delegation needs to push for General Fund relief in the recovery package, as well as federal guarantees for our municipal bonds, which would frankly jump-start projects faster than anything.  If it’s good enough for the banks, it should be good enough for California.

Published in: on January 22, 2009 at 9:33 pm  Leave a Comment  
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