You Are the Sucker, Catfood Commission Edition
On a business trip to lovely Eire without my laptop cable, I was spared further reading about inevitable Democratic attempts to make peace with the Simpson/Bowles abomination. But with a charger secured I decided to take a look. I’ll largely leave Jon Chait’s self-refuting defense for when I get back, but the short version is that since (as Chait concedes) Republicans don’t actually care about the deficit any deficit reduction “deal” one could make with them is worthless on its face. Absolutely nothing in the package could prevent the same kind of bait-and-switch that occurred after the Greenspan Commission’s payroll tax hikes or the 1993 Clinton budget, which where used by Republicans as a pretext for more upper-class tax cuts and spending hikes. Given this, any Democrat who supports a plan overwhelmingly tilted towards conservative priorities (and, indeed, constitutes a very conservative set of policy proposals rather than an actual deficit-reduction proposal) would be one of the biggest suckers in history.
Ygelsias, at least, doesn’t claim that liberals should support a compromise between conservative Democrats and conservative Republicans, but this argument nonetheless concedes far too much:
That’s not to say that pursuing a conservative-moderate deal was a bad idea. Self-identified conservatives outnumber self-identified liberals by a large margin and moderates are a much bigger force in the Democratic coalition than in the Republican one. So if you want a deal, appointing an orthodox conservative Republican and a moderate Democrat from North Carolina makes a lot of sense.
The problem in context — as Matt recognized as recently as two weeks ago — is that ideological self-identifications are largely devoid of specific policy content. Americans might by significantly more likely to call themselves conservatives than liberals, but this is neither here not there in terms of whether they support spending being reduced to 21% of GDP* or substantial reductions to the top marginal tax rate or substantial (if carefully unspecified) Medicare cuts. And, in fact, the evidence is quite overwhelming that even self-identified conservatives (let alone the population as a whole) don’t support actual fiscal conservative policy proposals of the type represented by Simpson/Bowles. So this was in fact a terrible idea that produced a set of proposals that should be considered completely indefensible — even as a starting point — for anyone close to the left of the American political spectrum.
*It might be objected that the Catfooders only want revenues capped at 21% of GDP. True, but if we’re not going to reduce spending to something close to this level, then what the hell are we discussing here? Certainly not a significant deficit reduction deal.
[...] You Are the Sucker, Catfood Commission Edition – [...]
I’ve been trying to justify Obama’s actions for a while now. My point is that he can’t come across as too ‘anything’ as the first African-American President, without being seen as too ‘something’ by the imbeciles in this country (upset/angry Black man).
But this commission is the absolute pits. Usually Obama comes to a gun fight armed with a knife. This time, he gave his opponents AK-47′s, and will come armed with a plastic spork.
Jesus, if I wanted to capitulate and surrender to the Republicans at every turn, I’d have supported and voted for Lieberman for President.
That would make more sense if Republicans were actually supporting the commissions proposal.
You know, I’m willing to concede that there’s some worthwhile stuff in Simpson/Bowles. I’m in favor of simplifying the tax code, if only because the more complex it is the easier it is to skate out from under it if you have the right lawyers. There’s defense cuts in there, that’s good. FICA is dealt with in a way that’s KINDA okay. And taxing capital gains as actual income? That may be the part I’m MOST behind.
But that stuff seems very fig-leafish, almost grudging. It covers up shit like using the increased revenue from broadening and simplifying the tax code to give a MASSIVE new round of tax cuts for the wealthy. Indexing Social Security to inflation rather than wages and means-testing any part of it is a fancy way of saying ‘slowly kill the program.’ It mentions cutting Ag subsidies but neglects to mention that the amount of cuts proposed are at something like two percent of what we piss down that hole annually. And of course, its stance on health care is basically the dictionary definition of magical wishing.
I’m not surprised that Andrew Sullivan has a boner for this plan; I’m more surprised by the hemming and hawing I see coming from people who ought to know better, like Yglesias, Drum, and chait.
Although Matthews economics posts lately have been trending towards a weirdass kind of incoherent local/libertatianish screeds about regulations that seem to be clouding his judgment when it comes to the big picture.
I look forward to your full takedown when you get back, Scott.
In fairness, Drum has been pretty hostile from the beginning. Chait’s position is inexplicable.
Also in fairness to K-Drum, in-between when I posted my original response and right now, he put up a post thoroughly savaging the whole thing. So, yeah.
Chait says that no matter which party holds the majority, we should adopt Republican legislation. That’s always been Chait’s position, so it’s perfectly explicable.
Or, um, not.
I agree with most of your post, but I am wondering where you get the idea that there will be a massive tax cut for the wealthy with the change in the capital gains tax, the increase in the social security contribution limit, and the lack of any review of the effects of the tax changes listed in the proposal.
Hmm. Perhaps that could have been more artfully phrased, but when you chop the marginal rate of the uppermost bracket by twelve percentage points (from 35% now in 2010 to 23%) that’s a pretty giant goddamn tax cut.
My larger point was that the increase in revenue from things like the change in the capital gains tax and the increasing of FICA eligibility is being applied to a massive chopping of the marginal rate, rather than, you know, deficit reduction, even IF there’s an increase in the -effective- rate of taxation. As I said, perhaps I phrased that inartfully but I stand by the sentiment.
I’m completely unsurprised by the “nuanced” views of certain mainstream bloggers. And it’s a splendid example of how Bowles and Simpson have just succeeded in moving the goalposts of “serious discussion” to the right, once again, aided and abetted by the President who put them there.
I’m reminded of something Pelosi said around the time of Bush’s big move on Social Security. She was asked something along the lines of when the Dems were going to offer their own proposal and she said flatly there wasn’t going to be one. In other words, the debate wasn’t going to be on Bush’s terms.
I’m more surprised by the hemming and hawing I see coming from people who ought to know better, like Yglesias, Drum, and chait.
Really? I mean, really? Go read Greider’s latest take on Obama. You’ll probably agree with every word of it. Digby does. The longer people keep their heads in the sand, the less likely we are to support a primary opponent for this clown.
I’m not sure what Greiders latest piece in The Nation, excellent though it is in many ways (although I disagree with a number of his initial premises, and he gets the facts wrongs a couple times; if you DO agree with them its a well-reasoned piece, I like Bill Greider, he does good work) has to do with my being puzzled at the heavy hitters of the liberal blogonaut brigades seeming to drop the ball on this. Not everything is about Obama, Jeer.
The Catfood Commission is his idea, though.
the commission was a damn fool idea, since we know perfectly well how to cut the deficit: we had a demonstration a mere decade ago!
you increase tax rates and you commit to paygo from that point on and over time the deficit shrinks.
and looking longer term, we know perfectly well how to reduce health-care costs as an aspect of the federal budget: the public option.
now, we can quibble on the left as to whether, in fact, we really need to be in budgetary balance across the business cycle (which is really the appropriate metric anyhow) or whether a small deficit isn’t always appropriate from a standpoint of, you know, improving the lives of 300M people, but from a public policy standpoint, anything that doesn’t point to both the short-term and long-term solutions i just summarized is just unserious.
And you stop Endless War for several decades so we can catch up with repairing the damaged troops who fought therein.
Reading your post made me think about how much would have changed if the public option would have been pushed through.
This proposal somewhat accepted the cost effects of health care reform. If the public option would have been passed by hook or by crook, I have a feeling this commission would have legitimized it amongst conservatives to a degree.
Obama is spinning his wheels and getting nowhere.
Even as a libertarian I wish we lived in a country where Russ Feingold could ride anti-establishment/anti-republican sentiment to the White House while Barack Obama gets his ass kicked by a moron conservative.
Damn right!
A plan that cuts defense spending, agricultural subsidies, and actually makes the social security program more progressive is indefensible!
Sure it is impossible to deny that we have a long-term budget problem that needs action. Sure the proposal basically secures the acceptance of the cost savings of health care reform (even though it does undercut spending on it). Sure the proposal actually calls for tax increases and recommends a revenue cap that would be higher than it has been in the US at least since WWII. And sure the proposal specifically mentioned the way tax expenditures are incredibly regressive and sought to equal that out.
None of that matters!
All that matters is that republicans don’t actually want to cut the deficit and may use this to pass through tax cuts for the rich.
Serious people know that republicans will take advantage of any plan like this to push their agenda, so we shouldn’t discuss anything.
A plan that cuts defense spending, agricultural subsidies, and actually makes the social security program more progressive is indefensible!
Cute, no, really. But as Krugman points out:
What the commission was supposed to do was something much harder: it was supposed to produce a package that Congress would give an up and down vote. To do this, it would have to produce something much better than a package with some good stuff buried in among the bad stuff; it would have to produce a package good enough to accept as is.
And it didn’t do that. Instead, it produced a package that may have had some good things in it, but also, remarkably, introduced a whole slew of new bad ideas that weren’t even in the debate before.
In addition to the point above, also note:
1)21% of GDP will not be remotely adequate to account for upcoming federal outlays, given demographic changes and the fact that the interest charges Republicans ran up to finance upper-class tax cuts and wars won’t go away. Putting an arbitrary limit on revenues is stupid — this is a question that should be determined politically. And given the fact that virtually approves the kind of cuts that would be necessary to achieve this in most years going forward it also illustrates that this isn’t really a deficit proposal.
2)Any proposal that substantially raises the retirement age doesn’t make Social Security more progressive.
just for the record, tax revenue as a percentage of gdp in that capitalist haven germany, whose ways we’re all supposed to be impressed by, depending on how you calculate it, runs from 35 – 40% of gdp:
http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP
(which reminds me of my standard answer to right-wing comments d’jour about how great budget austerity in germany is, which is you give us the german social safety net first and then we’ll talk about the acceptability of austerity in that context….)
2)Any proposal that substantially raises the retirement age doesn’t make Social Security more progressive.
The retirement age should not be raised at all. In this country it is more than high enough.
1) I don’t understand the last sentence.
2) The retirement age rises two years between now and 2075.
Meanwhile it shifts the marginal benefit rates in a more progressive direction maintaining the same 90% lowest level and shifting the upper level from 15% to 5%. It broadens the tax base by increasing the cap on Social Security wages by 70,000. It also increases the minimum benefit and increases benefits for anyone eligible for more than 20 years.
What does that have to do with my post?
Are you saying that you want me to note that you reject any consideration of the contents of this proposal because of republican motives and because it introduced new ideas?
Why would anyone take Yglesias seriously?
All serious people believe that our nation’s highest priority is dealing with the overregulation of barbershops and ensuring that no community can regulate the number of its bars and restaurants. Serious people believe that the “great progressive projects of our time” have been completed now that health care is taken care of.
Christ what an asshole. No wonder the libertarian’s love that guy. And vice versa.
Indeed!
All serious people believe that a political blogger’s weird fascination with local zoning issues equals his belief that it’s the nation’s highest priority.
A lot of things are irksome about Yglesias, but playing footsie with the libertarians on issues where they might have a point isn’t one of them for me.