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Tuesday, March 31, 2015

Budgets: VooDoo, Quackery and Morality?

Do you recall what George H.W. Bush said about Ronald Reagan’s economic proposals when they were both running for the Republican nomination for President in 1980?  He called it “Voodoo economics.”  By which he meant, as I remember, that it was all smoke and mirrors, based on false premises and irrational thinking.  Unfortunately for the average American, that Republican tradition has been kept alive with the kinds of budgets presented by Paul Ryan and his House Budget Committee in the past five years.  Even though Ryan is no longer chair of that Committee, he is still influencing the kind of ‘voodoo’ that continues to pour forth from that particular group.  Representative Chris Van Hollen of Maryland, ranking Democrat on the House Budget Committee, put it in different but similar imagery, when he said:  “This takes budget quackery to a new level.”

On March 17, the new House Budget Committee Chair, Tom Price (R-Ga.), announced a budget proposal that offered deep cuts in many areas, although, as usual, the sponsors managed to cover over with rhetoric and vague symbols the true meaning of the document.  For instance, according to the NY Times, House Republicans called it “streamlining, empowering states or achieving sustainability. They couched deep spending reductions in any number of gauzy euphemisms.” 

The Times article went on to add: “What they would not do on Tuesday was call their budget plan, which slashes spending by $5.5 trillion over 10 years, a ‘cut.’  The 10-year blueprint for taxes and spending they formally unveiled (claimed to)…balance the federal budget, even promising a surplus by 2024, but only with the sort of sleights of hand that Republicans have so often derided.  The budget — the first since Republicans regained control of Congress this year —largely reflects the four previous versions written by Representative Paul D. Ryan of Wisconsin when he was chairman of the Budget Committee. But this plan may fare better than Mr. Ryan’s since Senate Republicans will be under pressure to reach an accord.”

In my last Blog of March 22nd, I mentioned the summary that Senator Bernie Sanders of Vermont had used to describe the Republican Budget.  His Democratic colleague in the House, Rep. Mark Pocan of Wisconsin, echoed Sanders words when he said, “The Republican budget means Americans will work harder and earn less. It will be harder to buy a home, harder to send your children to college and harder to save for a secure retirement. It will do nothing to grow wages or help people get ahead, but it will do one thing for the people in the middle class: it will give you a $2,000 tax increase so that the wealthiest in this country can get a tax break.”

Let’s take a brief look at what the Republican Budget would do if passed by both the House and the Senate Republican majority:

§  Their budget demands the full repeal of the Affordable Care Act, including the tax penalties that finance the health care law. But the budget plan assumes the same level of federal revenue over the next 10 years that the Congressional Budget Office foresees with those tax increases in place — essentially counting $1 trillion of taxes from the ACA that the same budget swears to forgo.  The Independent Payment Advisory Board — the unelected 15-member agency created under the PPACA that is charged with achieving Medicare savings — is also repealed under the proposed budget.

§  The budget proposal calls for transforming Medicare into a "premium support model." Under the new model, Medicare recipients would receive "premium support" to purchase private insurance off of an exchange for Medicare plans.

§  The plan contains more than $1 trillion ‘savings’ from unspecified cuts to programs like food stamps and welfare. The plan would cut billions of dollars from the Supplemental Nutrition Assistance Program (better known as food stamps).  This is how the budget phrased these devastating reductions: “This budget converts SNAP to a State Flexibility Fund so state governments have the power to administer the program in ways that best fit the needs of their communities with greater incentives to achieve better results.”

§  Domestic programs would be cut $519 billion below the already restrictive caps set in 2011. White House officials estimated that between the Affordable Care Act repeal and the cuts to Medicaid, 37 million people would lose health insurance, more than doubling the ranks of the uninsured.

§  The budget cuts popular Pell Grants for higher education but makes it sound workable: it “makes the Pell Grant program permanently sustainable,” the document says.

§  Spending on Medicaid may fall $913 billion over a decade once the health program is turned to block grants to the states, but House Republicans preferred to say: “Our budget realigns the relationship the federal government has with states and local communities by respecting and restoring the principle of federalism.”

§  The House budget would bring total military spending higher than Obama’s request, a critical demand by some Republicans in both the House and the Senate. The House plan increases military “overseas contingency operation” spending. Without relying on tax increases, defense hawks added nearly $40 billion in “emergency” war funding to the defense budget for next year, while the Senate would create a fund to override current military spending caps. “My main concern is getting the numbers up, whatever it takes,” said Senator James M. Inhofe, Republican, and that seems to be the main concern of many Republicans as the discretionary spending on the military equals 55% of the entire budget. The Pentagon keeps having weapons they don't want shoved down their throat by those congressmen seemingly obsessed with military preparedness.  The availability of lucrative military contracts to their monetary supporters is the underlying reason for this, as I have indicated in past postings.

This presents a sharp contrast with the plan proposed by President Obama in early February.  Obama’s budget, in brief, would do the following:

·         Increase taxes on the wealthiest individuals and on corporations, including a one-time tax on corporate profits held overseas. Revenues would be $3 trillion more over 10 years than the Congressional Budget Office projects under current law.

·         Cancel automatic cuts known as sequestration to domestic and military programs and increase spending by $1 trillion over 10 years, compared with a situation in which all current laws stay in place. Includes new spending for immigration and education.

·         Flatten out deficits around 2.5 percent of G.D.P. because of the increases in revenue. Under current policies, the deficit is expected to slowly increase beginning in 2018.

·         Flatten out the debt around 73 percent of G.D.P. Under current policies, the debt is expected to climb to 79 percent by 2025.

·         Include language calling for an overhaul of the tax code. (Sources: Center on Budget and Policy Priorities; Congressional Budget Office; House Budget Committee; Senate Budget Committee; the White House and compiled By Alicia Parlapiano)

A budget you will not hear much about - the Progressive Caucus People’s Budget – went down to defeat on the House floor last week, but not before it picked up 96 Democratic votes, a majority of Democrats. The budget got 330 nays, including 86 from Democrats.

“The People’s Budget did get fewer votes than Democratic alternatives proposed by Rep. Chris Van Hollen (D-Md.) and the Congressional Black Caucus, but it got a larger share of Democratic votes than it did in previous years. Republicans, not surprisingly, were unanimous in opposition.

“Rep. Keith Ellison (D-Minn.), co-chair of the Progressive Caucus, pointed out that the Progressive Caucus budget specifically promises to produce 8.4 million new jobs through a specific set of policies. The Republican budget, he noted, makes no similar job-creation commitment.

“Republicans are clearly angry we are ending this special treatment of Wall Street buddies, meanwhile they have no problem ending tax credits for low and middle-income families,” said Progressive Caucus co-chair Rep. Raul Grijalva (D-Ariz.), while including “a promise to spend hundreds of billions on high income and corporate tax cuts.”  Republicans “say they are seeking to balance the budget. They are balancing this budget on the backs of the middle class while cutting taxes for the wealthy and well-connected, and getting to balance through irresponsible budget gimmicks,” Grijalva said.

“House Republicans took the progressives budget to task because, unlike the House Republican budget, it does not slash domestic spending in a quest to “balance” the budget in 10 years. They pointed out under the budget government spending would take a larger share of the economy, and so would the taxes to fund it. But The People’s Budget boosts economic opportunity for more Americans and gives hardworking Americans a raise.”  (Ourfuture.org – Isaiah Poole - March 25, 2015)

An EXECUTIVE SUMMARY from Daily KOS gives us a fuller idea of what the Progressive Caucus promotes:
A RAISE FOR AMERICA
§ Creates more than 8 million good jobs by 2018.
§ Increases functionality of Worker Protection Agencies.
§ Includes a four percent raise for federal workers.
§ Provides Paid Leave Initiative and Child Care.
§ Supports a minimum wage increase and Collective Bargaining.

AUSTERITY TO PROSPERITY
§ Repeals sequester and all Budget Control Act spending caps.
§ Increases discretionary funding to invest in working families.
§ Reverses harmful cuts and enhances social safety net.
§ Invests in veterans, women, communities of color and their families.

FAIR INDIVIDUAL TAXES
§ Equalizes tax rates for investment income and income from work.
§ Returns to Clinton-era tax rates for households making over $250,000 and implements
new brackets for those making over $1 million.
§ Expands the Earned Income Tax Credit and the Child Care Credit.

FAIR CORPORATE TAXES
§ Eliminates the ability of U.S. corporations to defer taxes on offshore profits.
§ Ends corporate inversions that allow U.S. companies to merge offshore to avoid taxes.
§ Enacts a Financial Transaction Tax on various financial market transactions.
§ Ends unlimited executive pay tax write-offs.

EDUCATIONAL OPPORTUNITIES FOR EVERY STUDENT
§ Provides debt-free college to every student.
§ Allows refinancing of student loans.
§ Invests in K-12 and provides free pre-school.

AFFORDABLE HEALTH CARE
§ Repeals excise tax on high-priced workers plans and replaces with public option.
§ Implements drug price negotiation for Medicare.
§ Reauthorizes Children’s Health Insurance Program.
§ Allows states to transition to single-payer health care systems.

PROTECTING OUR ENVIRONMENT
§ Closes tax loopholes and ends subsidies provided to oil, gas and coal companies.
§ Enacts a price on carbon pollution without hurting low-income families.
§ Invests in clean and renewable energy and green manufacturing.

SUSTAINABLE DEFENSE
§ Modernizes our defense posture to create sustainable baseline defense spending.
§ Ends emergency funding for Overseas Contingency Operations.
§ Increases funding for diplomacy and invests in job transition programs.

COMPREHENSIVE IMMIGRATION REFORM
§ Implements comprehensive immigration reform, including a pathway to citizenship.

ACCESS TO HOUSING
§ Fully funds programs to make housing affordable and accessible for all Americans.

PUBLIC FINANCING OF CAMPAIGNS
§ Funds public financing of campaigns to curb special interest influence in politics.

Strangely enough, it is a Republican legislator who provides the conclusion to this summary of budgets for 2016.  Budgets are boring numbers to some, perhaps, but:  “A budget is a moral document; it talks about where your values are,” said Representative Rob Woodall, Republican of Georgia and a member of the Budget Committee. And President Obama blasted the lack of that dimension after a meeting with the Prime Minister of Ireland.
. "It's not a budget that reflects the future. It's not a budget that reflects growth. It's not a budget that is going to help ensure the middle-class families are able to maintain security and stability and that people who are trying to get into the middle class are going to have the rungs on the ladder to get into the middle class," he said, according to Politico. 

Although Congressional budgets are largely advisory documents, "they represent the broadest statement of governing philosophy each year” the NY Times has said.  And, every time the radical Republican majority produces a budget, their lack of a moral philosophy or a code of caring about the welfare of millions of ordinary citizens is obvious.  Unfortunately, too many of those citizens have not yet realized that a philosophy of discrimination, of tax-based support of small and powerful elites, the privatization of government services-for-profit (like education), and the uber-militarization of our nation are not in their best interests.  The cloaking of ultra-conservative Christian beliefs (as in Indiana) in legislating against certain practices (use of contraceptives, abortion; same-sex marriage); the belief that people who struggle with the exigencies of life are fully to blame for their circumstances, or the obvious belief that some people are just not worthy of protection, special treatment, or unique program help – all of these are beliefs and principles that are harmful to citizens and to our democracy.  Republican budgets are basically manifestos – declarations of motives and intentions of what this Party is about to do to 99% of us while exempting themselves and their sponsors from any responsibility for their lack of morality, caring or empathy for most of our citizenry. 

Too many voters have failed to learn that elections and budgets have consequences, and that under ultra-conservative Republicans, those consequences will essentially devastate liberty, justice, fairness, civil rights, mutual responsibility for one another, as well as very basic everyday concerns like costs, rents, loan rates, quality of schools, roads and services, or that most basic opportunity: a well-paying job.  Soon, their lack of caring will even affect what we can safely eat, drink or inhale.  My point:  it is dangerous to one’s health and welfare to ignore ANYTHING this cabal of Radicals attempts to foist upon the People.