The Multiplier Effect

Randy Stapilus,at Ridenbaugh.com, points out one more unintended consequence of Idaho’s “slash and burn” budget.

In Oregon, the campaign against two tax measures on the ballot – which passed – was centered around the idea that those taxes were “job-killing.” In Idaho, the very notion of a tax increase of any sort is way off the table, in large part because of that same assumption, that taxes imposed on people and businesses will kill private sector jobs. (There’s probably a grudging acknowledgement that public sector jobs would be saved, but that appears to be a lesser factor.)

But consider this point from the latest Idaho Reports program from this weekend, reviewing the state of the budget-setting Idaho. The matter of jobs may not be quite so simple.

The subject was the state budget and jobs, as discussed by three members of the budget-writing Joint Finance-Appropriations Committee. Here’s Democrat Wendy Jaquet:

“What bothers me as we lay people off because we don’t have this revenue, or we think we don’t have the revenue, then we have kind of a multiplier effect. I asked the director of the Department of Health & Welfare how many private sector jobs would be lost [under current budget proposals] because most of our [services] are done by private providers. And he estimated on the worst-case scenario, which is where we’re headed, it would be about 8,000 private-sector jobs. So its like we’re creating a downward spiral, and that’s what I find really worrisome.”

A Tale of Two States

It is the worst of times. It is a time when state legislatures are making draconian cuts in services in order to make up budget shortfalls. In the case of the state of Idaho, Governor Otter has proposed cuts in public and higher education, Idaho Public Television, the Department of Parks and Recreation and the Department of Health and Welfare. These cuts will not just have an impact of this year’s budget. Once agencies are slashed, they can not easily be reconstructed.

What is even more tragic about these cuts is that they are unlikely to save the state money in the long run. There are hidden costs have been ignored in the rush to cut.

According to Betsy Russell,

One example: The $1.6 million the state would save by cutting off funding for Idaho Public Television may be less than the amount IPTV has to repay the federal government for portions of $4 million in grants. The grants paid for equipment to convert the statewide TV network to digital signals, and if the equipment isn’t used for its intended purpose for 10 years, repayments are due.
Another: Gov. Butch Otter’s initial proposal to eliminate the state Department of Parks and Recreation and sell its headquarters building sought to save $10 million, but it could have cost the state the landmark Harriman State Park, likely worth $50 million. That’s because the Harriman family’s gift of the park to the state was contingent on Idaho setting up a professional parks department.
Once the Harriman Park issue became known, Otter dropped that plan in favor of a more modest proposal to cut costs at state parks and lay off 25 employees of the agency.
At the state Department of Health and Welfare, every $1 cut in state funds means losing $3.75 in federal money, too. Budget cuts there over the past two years have cost the state $120 million in federal funding.
“I don’t know if it matters to a lot of people that there are these hidden costs, but I kind of hope it does,” said Steve Shaw, a political scientist at Northwest Nazarene University. “It looks like somebody didn’t do their homework.”
Another possible explanation, Shaw said, is that the cuts may be more about ideology than fiscal realities. “What do we think government should be doing?” he asked. “It seems like an increasing amount of people on the Republican side in the state Legislature, especially in the Idaho House, think, well, not much.”

In other words, Otter and the other Republican ideologues have been itching for an opportunity to take a gigantic “bite out of government” and the current economic crisis is just that opportunity.

Oregon, Idaho’s neighbor to the west faces a similar shortfall. Their solution was one Idaho’s libertarian Governor and majority Republican party would never consider- raising revenue.  A little over a week ago, Oregon passed two tax measures, 66 & 67, that raise the corporate minimum tax from $10 to $150 and raise the tax rate on household income above $250,000.

Myths about measures 66 & 67

1)  This is a “soak the rich” scheme. Otter called it “class warfare.”

From the website Too Much,

Back in 1930, voters in Oregon approved a state income tax. They haven’t voted, statewide, for a tax increase ever since. Until last week. Oregon voters on Tuesday gave healthy majorities to two initiatives that will hike taxes on the state’s corporations and wealthy. Affluent Oregon couples will see their tax rate on income over $250,000 rise by 1.8 percent. Oregon millionaires, even with the increase, will still be paying state and local taxes at a lower overall rate than the poorest fifth of Oregon households. But the children in those households will now be attending public schools spared the cutbacks that would have been inevitable without last week’s tax-the-rich triumph. Notes Karen Kraut, an organizer with the Boston-based United for a Fair Economy: “The remaining 49 states would be wise to follow in Oregon’s footsteps.” State governments are currently projecting a $102 billion budget shortfall for the upcoming fiscal year . . .

Sorry to say this to the average working person, but the class war has already been fought and you lost.

2) The measures passed because the liberal hippies in Multnomah County  voted for it.

Not the case, according to the Oregonian:

So it’s remarkable enough that both measures passed, and fairly comfortably, with Measure 66 (raising taxes on upper incomes) getting 54.3 percent and Measure 67 (business taxes) winning 53.6 percent. What’s especially astounding is that Multnomah County was almost a bit player.

Measure 66, in fact, was leading by 5,000 votes before the counting ever reached the Multnomah County line. (Multnomah then tossed in its margin, just more than 100,000.) Measure 67 barely trailed, by 11,500, outside the state’s most populous county.

3)  The tax increases will drive away business. Entrepreneurs will flock to states like Idaho that are “business friendly”.

On his blog, Idaho Statesman reporter Rocky Barker wonders:

So Oregon’s vote, coupled with Idaho’s deep cuts in education, social services and all state government services, gives people on both sides of the issue a real chance to prove who is right. Will the state that raises taxes to protect schools and services do better economically than the state that keeps taxes low?

Will Idaho place billboards on Oregon’s Interstate 5 saying “Come to the state of low taxes on the rich and corporations?” I heard some lobbyists say this might be a real opportunity.

Here is the problem Rocky, even after the passage of measures 66 & 67, Oregon has a better business tax climate than Idaho. In fact, according to the just released 2010 State Business Tax Climate Index (which factors in measures 66 & 67 to the Oregon ranking), Idaho ranks below all of its surrounding states.

I would hold off on putting up the billboards just yet.

Update: Abductors for Jesus

The “Baptist 10″ have been charged with abduction and criminal association.

The charges, which carry prison terms of up to 15 years, were announced after a closed-door court hearing in which prosecutors questioned the Americans, most of them members of a Baptist congregation from Idaho.

The Central Valley Baptist Church has tried to paint Laura Silsby as an innocent doing God’s work.  A story in the Idaho Statesman paints a different picture.

The Idaho woman who led a group of 10 Baptists on a mission to help children in Haiti admits to failing to obtain paperwork needed to move 33 children to the Dominican Republic.
But even before Laura L. Silsby and seven other Idahoans ended up in a Haitian jail accused of trafficking in children, Silsby had a history of failing to pay debts, failing to pay her employees and failing even to follow Idaho laws.
Silsby has been the subject of eight civil lawsuits and 14 unpaid wage claims. The $358,000 Meridian house at which she founded her nonprofit New Life Children’s Refuge in November was foreclosed upon in December. A check of Silsby’s driving record revealed at least nine traffic citations since 1997, including four for failing to provide insurance or register annually.
One way to avoid taking responsibility for your own actions is to claim that you are following God’s directives. In Silsby’s words, “God has laid upon our hearts…” the need to go to Haiti and abduct children.
On their website Central Valley Baptist Church claims the church team was falsely arrested and it was all a misunderstanding.
A ten member church team traveled to Haiti to help rescue children from one or more orphanages that had been devastated in the earthquake on January 12. The children were being taken to an orphanage in the Dominican Republic where they could be cared for and have their medical and emotional needs attended to. Our team was falsely arrested today and we are doing everything we can from this end to clear up the misunderstanding that has occurred in Port au Prince.
According to the Statesman article about Silsby,
Members of her church, Central Valley Baptist in Meridian, did not return calls Wednesday.

Kidnappers for Jesus?

The Idaho Statesman has an editorial this morning arguing that it is “premature and irresponsible” to comment about the 10 Baptist detainees in Haiti. The editorial uses a common rhetorical device of presenting the reader with black and white choices.

No middle ground here. Were the Americans well-intentioned – albeit woefully naive about international law? Or were they engaged in a criminal act in a nation where leaders believe they must, in the aftermath of catastrophe, take an unflinching stand against the abhorrent act of human trafficking?

Actually, the legal question is the least interesting aspect of this sorry story. When did ignorance of the law become a defense? Of course, they broke the law. They attempted to take 33 children across the border to the Dominican Republic without the proper papers. The fact that they might be “well-intentioned” is beside the point if you only look at this (as the Statesman claims we must) as a legal issue.

I see this as a story about poverty and about hubris. The real tragedy is that many of the 33 “orphans” had been taken from Haitian parents. Representatives of Laura Silsby’s New Life Children Refuge approached parents from Callebasse, a village outside the direct path of the earthquake but extremely poor, and asked them to give up their children. The parents were promised that their children would be provided with food, shelter and schooling.

CNN tells the story

CNN A Story About Poverty

CNN A Story About Poverty

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What were the intentions of Laura Silsby and her New Life Children Refuge?  She makes it quite clear on the nlcr mission statement asking for donations and volunteers. This was originally on the web site of East Baptist Church in Twin Falls, one the two churches supporting the mission to Haiti, but has subsequently been taken down.

Notice that Silsby had plans to build an orphanage, school and church in the Dominican Republic before the earthquake in Haiti. She decided to take advantage of the opportunity that presented itself and “go now”. She did this because “God laid upon our hearts the need” to go now. Silsby filed to incorporate New Child Refuge in November (see document here  New Life Children’s Refuge Incorporation ) It has tax exempt status with three board members- two of them being Silsby and her nanny and appears to be located in her home.

Here is the hubris. These people seem to believe that God speaks to them. They believe that God wants them to take children, most of whom are already Christian (given that Haiti is a largely Catholic country) and help them “find a new life in Christ”.  Their “charity” masks their real intent- to convert the children. As Rev. Clint Henry of the Central Valley Baptist Church points out, this is the central tenet of their religion.

We believe that Christ has asked us to take the gospel of Jesus Christ to the whole world, and that includes children.

Silsby and her group only planned on spending  enough time in Haiti to grab any available orphans and ship them across the border to the Dominican Republic, without obtaining permission from the Haitian government:

The long range plans for NLCR were a bit more grandiose.

It is all about teaching the “orphans” Christian values/truths so they can be adopted by loving Christian parents.

This is only the latest chapter in the history of the corrosive combination of Christian missionary work and colonialism.

If you are wondering why the Haitian people might be distrustful of outsiders claiming to “help” them, you might want to read this.

So Statesman editorial board, I am sorry if I sound judgmental, but I find all of this disgusting.

“Deficit Peacock” Mike Crapo

Who would co-sponsor a bill and then vote against it? Six Republican Senators including Idaho’s “Deficit Peacock”, Mike Crapo, that is who.*

Until Obama’s State of the Union speech, Crapo proudly proclaimed that he was a co-sponsor of the bipartisan Conrad-Gregg “Fiscal Task Force.” The Task Force would create an 18 member commission who would devise a deficit reduction blueprint after the November elections that would be voted on before the new Congress convenes next year.

Republicans claimed the Fiscal Task Force as their own. It gave them a great way to attack the “tax and spend” Obama administration. Here, for example is what Senate Minority leader, Mitch McConnell , said last May:

We must address the issue of entitlement spending now before it is too late. As I have said many times before, the best way to address the crisis is the Conrad-Gregg proposal, which would provide an expedited pathway for fixing these profound long-term challenges. This plan would force us to get debt and spending under control. It deserves support from both sides of the aisle.

Always on the lookout for a way to increase his fiscal hawk cred, Crapo became an enthusiastic co-sponsor of the bill. So what caused the about face?  President Obama endorsed the task force in his State of the Union.

Well, Crapo and his fellow Republican co-sponsors couldn’t find themselves in the position of supporting anything Obama favored, so, just prior to the SOTU, they withdrew their support. Commenting on McConnell’s vote against the legislation in an editorial in the Washington Post, Fred Hiatt said “No single vote could embody the full cynicism and cowardice of our political elite at its worst”. The same can be said about the cowardly seven co-sponsors.

Of course, after withdrawing their support, the seven Republican lemmings, including Crapo, voted against the bill. PolitiFact.com summarizes:

…on Jan. 26, 2010, when the Conrad-Gregg bill, originally introduced as S. 2853, came for a vote in the Senate, it fell seven votes shy of the Senate’s 60-vote threshold for passage, garnering 53 yeas and 46 nays, with one senator not voting.

The measure would have passed with 60 votes if only seven additional Republicans who had co-sponsored S. 2853 voted for it. Instead, those seven — Robert Bennett of Utah, Sam Brownback of Kansas, Mike Crapo of Idaho, John Ensign of Nevada, Kay Bailey Hutchison of Texas, James Inhofe of Oklahoma and John McCain of Arizona — withdrew their co-sponsorship in the days before the vote and then voted against it on the floor.

While McConnell and McCain have caught a bit of flak from the national media, Crapo flies under the radar as usual. Let me know if any local media point out the hypocracy. I won’t hold my breath.

* Paul Krugman calls anyone who claims to be a deficit “hawk” simply for political gain a deficit “peacock” and no one fits that description better than Crapo.

Howard Zinn, Dead at 87

I don’t have many heroes, but Howard Zinn was one. As a historian, he insisted that the voices of the powerless be heard. As an activist, he lived his beliefs. The term “populist” is currently used and abused in the media. Howard Zinn understood what the term should mean.

If you haven’t heard of Howard Zinn, I doubt anything I can say will make him live for you and I am sure the obituaries will turn his life into a sound bite. So, my suggestion would be to go here and by a copy of A People’s History of the United States. Even if you have read it at some point in the past, read it again. It will put some of today’s craziness into perspective.

Mr. Freeze Panders to the Dodos?

The early reports are that President Obama will call for a three-year spending freeze in his State of the Union address Wednesday. According to Jonathan Zasloff,

The move, intended to blunt the populist backlash against Obama’s $787 billion stimulus and an era of trillion-dollar deficits — and to quell Democratic anxiety over last Tuesday’s Massachusetts Senate election — is projected to save $250 billion, the Democrats said. The freeze would not apply to defense spending or spending on intelligence, homeland security or veterans.

I can’t think of anything more dangerous than making policy decisions based upon polls. Supposedly, Obama would rather be a really good one-term President than a mediocre two-term President. I don’t think so. A spending freeze based upon a “populist backlash” is the action of a President who is willing to pander to critics in order to get reelected.  This is particularly ill advised when the outraged public is so misinformed about the stimulus package it is against.

Times Magazine’s Joe Klein, pulls no punches in a post on the blog “Swampland” called “Too Dumb To Thrive”

Absolutely amazing poll results from CNN today about the $787 stimulus package: nearly three out of four Americans think the money has been wasted. On second thought, they may be right: it’s been wasted on them. Indeed, the largest single item in the package–$288 billion–is tax relief for 95% of the American public. This money is that magical $60 to $80 per month you’ve been finding in your paycheck since last spring. Not a life changing amount, but helpful in paying the bills.  The next highest amount was $275 billion in grants and loans to states. This is why your child’s teacher wasn’t laid off…and why the fire station has remained open, and why you’re not paying even higher state and local taxes to close the local budget hole.

It turns out that what people are really upset about is all that wasteful money that has gone to political public works projects…except that the overwhelming portion of that money hasn’t been spent yet. Remember all those “shovel-ready” projects? Well, they didn’t exist. The big jobs-creating projects like the rebuilt “smart” electric grid, major highways and fast trains will come on line during the next year. (Although these projects might have gotten greater public support if they’d been chosen by a National Infrastructure Bank–a panel of experts, like the fed–that would have picked them according to their value added, rather than by the bozo appropriators in the Congress.)

It is very difficult to have a democracy without citizens. It is impossible to be a citizen if you don’t make an effort to understand the most basic activities of your government. It is very difficult to thrive in an increasingly competitive world if you’re a nation of dodos.

A nation of Dodos? It seems to me the real problem is a nation misinformed by a main stream media. It isn’t just Fox news and Rush Limbaugh either. The model of all news programs is to give equal time to extreme partisans more intent on spin than truth. Even when there is an expert on a subject, she or he is “balanced” by a talking head willing to out shout the opposition. The “moderator” makes little or no attempt to correct inaccuracies either out of ignorance or out of a misplaced desire to appear impartial.

One expert that is willing to appear on the main stream media even though he has to endure constant abuse is Nobel Prize winning economist Paul Krugman. Here is his response to a spending freeze.

A spending freeze? That’s the brilliant response of the Obama team to their first serious political setback?

It’s appalling on every level.

It’s bad economics, depressing demand when the economy is still suffering from mass unemployment. Jonathan Zasloff writes that Obama seems to have decided to fire Tim Geithner and replace him with “the rotting corpse of Andrew Mellon” (Mellon was Herbert Hoover’s Treasury Secretary, who according to Hoover told him to “liquidate the workers, liquidate the farmers, purge the rottenness”.)

It’s bad long-run fiscal policy, shifting attention away from the essential need to reform health care and focusing on small change instead.

And it’s a betrayal of everything Obama’s supporters thought they were working for. Just like that, Obama has embraced and validated the Republican world-view — and more specifically, he has embraced the policy ideas of the man he defeated in 2008. A correspondent writes, “I feel like an idiot for supporting this guy.”

I think I am too depressed to actually watch the SOTU.

The Eminent Tribunal

After the Supreme Court’s infamous Dred Scott decision, which ruled that slaves were property, not persons, and effectively made slavery legal in the territories, Lincoln declared in his first Inaugural Address that

The candid citizen must confess that if the policy of the government upon vital questions affecting the whole people is to be irrevocably fixed by decisions of the Supreme Court . . . the people will have ceased to be their own rulers, having to that extent practically resigned their government into the hands of that eminent tribunal.

In a letter written in 1820 to William Jarvis, Thomas Jefferson expressed his deep reservations about judicial review,

You seem … to consider the judges as the ultimate arbiters of all constitutional questions; a very dangerous doctrine indeed, and one which would place us under the despotism of an oligarchy. Our judges are as honest as other men, and not more so. They have, with others, the same passions for party, for power, and the privilege of their corps…. Their power [is] the more dangerous as they are in office for life, and not responsible, as the other functionaries are, to the elective control. The Constitution has erected no such single tribunal, knowing that to whatever hands confided, with the corruptions of time and party, its members would become despots. It has more wisely made all the departments co-equal and co-sovereign within themselves.

Jefferson and Lincoln understood the dangers of a Supreme Court intent on activism. For those who think the latest outrage by the Roberts Court is an aberration, I suggest reading Packing the Court, the latest book by Pulitzer Prize winning historian, James MacGregor Burns.

Burns argues that, with the exception of the Warren Court, the Supreme Court’s historic role has been “as a choke point for progressive reform,” and that in “the Gilded Age of the late 19th century” and the “Gilded Age at the turn of the 21st,” the justices “fiercely protected the rights and liberties of the minority of the powerful and the propertied.” The American people, he concludes, “cannot expect leadership from unelected and unaccountable politicians in robes.”

Burns sees the Roberts Court for what it is, but, of course, no one listens to historians.

Friday afternoon, while listening to NPR on my car radio, I heard David Brooks explain to concerned (liberal) listeners that the Supreme Court ruling in Citizens United v. Federal Election Commission was nothing to be concerned about because corporations are as likely to back Democrats as Republicans. Later that evening, while watching PBS NEWSHOUR, here, again, was Brooks telling us,

I do not necessarily think it is great for the Republican Party and terrible for the Democratic Party, because when you look at who is willing to subsidize corporations and erect regulatory barriers, both parties actually do that. So, I think it will have bad effects, but not necessarily partisan effects.

I can’t wait to read David Brook’s column in the New York Times so I can find out what he really thinks about this landmark court decision.

Why is David Brooks, the “go-to” conservative pundet of the main stream media?  Because his analysis is always framed around partisan politics. The Citizens United ruling will have “bad effects”, but not partisan effects, so no need to worry.

Fortunately, there are some in the media who, like Burns, understand the import of those “bad effects.”  For example, the editorial in The New York Times The Court’s Blow to Democracy does a nice job of putting the decision into historical perspective.

With a single, disastrous 5-to-4 ruling, the Supreme Court has thrust politics back to the robber-baron era of the 19th century. Disingenuously waving the flag of the First Amendment, the court’s conservative majority has paved the way for corporations to use their vast treasuries to overwhelm elections and intimidate elected officials into doing their bidding.

Ruth Marcus explains the “shoddy scholarship” that was used to argue the “brazen power grab”. This by the same court that brought you Bush vs Gore.

In opening the floodgates for corporate money in election campaigns, the Supreme Court did not simply engage in a brazen power grab. It did so in an opinion stunning in its intellectual dishonesty.
Many of those commenting on the decision in Citizens United v. Federal Election Commission have focused on the power-grab part.
I agree with them. It was unnecessary for the court to go so far when there were several less-radical grounds available. It was audacious to seize the opportunity to overrule precedents when the parties had not pressed this issue and the lower courts had not considered it. It was the height of activism to usurp the judgments of Congress and state legislatures about how best to prevent corruption of the political process. As bad as the court’s activism, though, was its shoddy scholarship.

In The Washington Post, Michael Waldman considers the implications of the Court’s power grab,

The Supreme Court on Thursday upended a century’s worth of campaign finance law. An immediate question raised by the Citizens United v. Federal Election Commission decision is whether this will flood elections with suddenly legal corporate money. Less understood but deeply significant is what this shows about the court and its relationship to the Obama administration and Congress.

This far-reaching ruling augurs a significant power struggle. For the first time since 1937, an increasingly conservative federal judiciary faces a progressive and activist Congress and president. Until now, it was unclear how the justices would accommodate the new political alignment. The Citizens United decision suggests an assertive court, eager to overturn precedent, looming as a challenge to President Obama’s agenda.

Unfortunately, there doesn’t seem to be any obvious recourse to the activism of the Bush/Roberts Court. Burns anticipated a “coming crisis” where an “conservative, obstructionist” court would confront a liberal President and Congress. His radical suggestion is that the president should “announce flatly that he or she would not accept the Supreme Court’s verdicts” unless the people pass a constitutional amendment explicitly authorizing the justices to strike down unconstitutional laws.

Even though Burns makes a convincing case that “Judicial Review” was not the intent of the authors of the Constitution and is, in fact, unconstitutional, it would be political suicide for Obama, or any other contemporary President, to challenge the Court in that manner.

FDR, frustrated by the “nine old men” on the conservative court blocking New Deal legislation tried to pass legislation reforming the court. The political backlash was such that he ended up withdrawing the bill before it went down to overwhelming defeat.

Coco “Je Refuse!”

With the tragedy in Haiti, the war in Afganistan and all the other important news events, it is a bit silly to obsess the late-night talks show wars, but now that Conan has reached an agreement with NBC to leave for $45 million and tonight will be his last show, we can look at the events of the past few weeks through the objective lens of history.

Not a Good Week for Progressives

This has not been a good week for the American people. Thanks to the election of Scott Brown, it now appears that health care is dead. Air America has declared bankruptcy.

But, really, those concerns pale compared to what the activist Roberts court did today.  See here here here here and here.

Below is President Obama’s response.

With its ruling today, the Supreme Court has given a green light to a new stampede of special interest money in our politics. It is a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans. This ruling gives the special interests and their lobbyists even more power in Washington–while undermining the influence of average Americans who make small contributions to support their preferred candidates. That’s why I am instructing my Administration to get to work immediately with Congress on this issue. We are going to talk with bipartisan Congressional leaders to develop a forceful response to this decision. The public interest requires nothing less.

I wonder how the “populist” Republican tea baggers will respond?  After all, the say they are against Wall Street and the powerful self interest groups that silence the voice of the average American. Get ready for another giant tsunami of hypocracy.