Sunday, March 23, 2014

Putin Picks The Next President

Putin Picks The Next President

No, as of this writing, the Russians have not yet invaded the 48 contiguous states (he wouldn’t dare touch Alaska, with Mama Grizzly there.)  Nor has the missing Flight 370 actually been hijacked to a secret Soviet submarine base and retrofitted for mayhem.

But, the Russians are on the march, and we don’t really have a clue how to stop them.  Ross Douthat, the conservative columnist for the New York Times, wrote an extremely fine piece this Sunday “Russia Without Illusions.”  Douthat does something rare; he carefully examines the options without indulging himself in pettiness. Russia, he writes, can’t be what we want: a “normal country” that responds to rational stimuli, sees a value in international norms, internal economic growth, and acceptance of an American-led world order.  Nor can we expect that the putative attraction of the West will take the old Eastern European Warsaw pact countries away from Russia, and, in doing so, isolate it. 

So, we can’t really draw Russia in, and we can’t really keep Russia out.  Russia is going to chart its own course, and that is likely to be expansionist, either through pressure/outright annexation (like the Crimea) or the economic influence that comes from their vast energy supplies. The Russians just aren’t like us, and despite the best hopes of Bush (who looked deeply into Putin’s eyes) or Obama (who thought he could “reset” the relationship) they aren’t going play by the rules we make. 

Douthat goes further.  In effect, he says that there are no good responses available—not just for Obama, but for America.  The limits of our influence are obvious.  For sanctions to work, the Europeans have to be willing to play, and they aren’t the most reliable partners.  With the exception of the wildest cowboys (I’ll get to that in a moment) even the neo-cons aren’t really willing to risk American boots on the ground.  That doesn’t leave us entirely powerless. Douthat points out that there are economic and diplomatic strategies we can use, and should use, but let’s not expect to them to make things the way they were, or the way we would like them to be.  “What we need instead is realism: to use the power we have without pretending to powers we lack.”

So, why does Vlady get to pick our next President?  Crimea/Ukraine is the perfect political football. If there is one thing that is absolutely certain, it’s that every Republican, from the right wing talk show hosts, to the kookie Congressmen, to the uber-ambitious Presidential aspirants (except for Rand Paul, of course) know how to do it better. 

Last week we had the spectacle of both John McCain and Mitt Romney ripping into Mr. Obama, demanding more aggressive action and reminding people just how much better things would be if they were in charge.  They have different verbal approaches, with McCain snarling insults while Romney simply quietly despairs at the loss America suffered when it didn’t pick him, but both seem to be vying for the syndication rights to the new reality program, “Sorest Loser.”

They were joined by Marco Rubio, who tried to regain credibility after his immigration policy failures by floating an “important” speech about foreign policy (strength good, Obama bad) that had some anointing him as picking up the mantle of Ronald Reagan.  And Ted Cruz, who wants man up with missile batteries brought to Eastern Europe (looking at you, Vladimir.)

Is there anything wrong with the opposition party opposing?  Not necessarily.  The gold standard in cooperation was set by Senator Arthur Vandenberg (Michigan), who, along with Senator Robert Taft of Ohio, led the GOP’s isolationist wing before and during World War II.  Vandenberg rather famously converted to a more international approach in 1945.  In what was called “the speech heard round the world” he said we must “stop partisan politics at the water's edge."  He backed that up by cooperating with the Truman administration in forging bipartisan support for the Truman Doctrine, the Marshall Plan, and NATO.

But both parties have often ignored the gold standard.  When there are matters of true principle, or reasoned differences of opinion, that is the way it should be.  We should look for the right approach, not necessarily the President’s approach.

What make this time different is that, with the exception of Ted Cruz looking to channel Dr. Strangelove, there really aren’t policy disputes.  No one has advanced ideas that are materially different than those proposed by Mr. Obama.  Wiser heads in the GOP know what Mr. Douthat knows, that there’s no easy way out of the soup. They are just repackaging in a more “respected” tureen. 

Why do it? Why send a message to Putin that Obama will get no support no matter what he proposes?  Doesn’t that heighten the risks that Putin will grab for even more?  Well, we have a midterm election in seven months, and between Mr. Obama’s personal unpopularity, a favorable geographic tilt, and several vulnerable Senators who were aided by Mr. Obama’s decisive 2008 victory, the GOP is likely to expand it’s majority in the House, and take the Senate. 

So, when the GOP looks out at the landscape in 2015, they see a playing field where they have all the high cards. No legislation without their consent.  No nominations confirmed that they wouldn’t have picked themselves.  Now is the time to press their advantage.

And Putin is counting on that, and more.  He knows that not only is there no real support for serious economic sanctions in Europe, those sanctions aren’t really supported by business and banking interests here in the United States.  Particularly those with interests in Russia and its aligned countries.  And he knows that, after two unresolved conflicts and countless treasure in Iraq and Afghanistan, the American people will not support committing military assets in Crimea.  So he’s safe in pushing his advantage.

This is great for the GOP, right?  Putin grabs for more, big win in the midterms, followed by a complete stomping of the Democrats in 2016? Conservative paradise in 2017?  Moderates and liberals get ready to hide the children and the womenfolk?

Perhaps. But it’s also possible we will see something different; a cranky electorate that is more than ready to punish Mr. Obama for his flaws, but is tired of the endless and infantile carping.  If that’s the case, then the door is open for any candidate who appears to be a rational, experienced adult.  There are those people out there, in both parties, they just don’t shout as loudly.

With any luck, that could be Putin’s President.  I love irony.

Michael Liss (Moderate Moderator)

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Thursday, March 13, 2014

What the Ghost of FDR Could Show Bill de Blasio and CPAC

What the Ghost of FDR Could Show Bill de Blasio and CPAC

81 years ago this week, the newly inaugurated Franklin Delano Roosevelt, having just instituted an emergency nationwide bank holiday, gave his first Fireside Chat. 

It was a beauty. In plain language, he spoke directly to the American people. He did quietly, deliberately, almost intimately.  There had been a massive run on the banks, and even healthy ones were running out of money to give to depositors.  By closing the bank’s doors for a short time, they could determine which were sound, and which had been fatally wounded by speculation or bad luck. In the next few days, FDR said, they would begin to reopen, first in the 12 cities where there were Federal Reserve Banks, and then in other places.  

FDR didn’t condescend and he didn’t minimize the pain and anxieties of his listeners. I owe this in particular because of the fortitude and good temper with which everybody has accepted the inconvenience and hardships of the banking holiday.”  He told them the truth, “I do not promise you that every bank will be reopened or that individual losses will not be suffered, but there will be no losses that possibly could be avoided..”  He thanked them for their trust, I can never be sufficiently grateful to the people for the loyal support they have given me in their acceptance of the judgment that has dictated our course, even though all of our processes may not have seemed clear to them.”

He treated them like adults, as partners in the solution.  The people, rich or poor, great or small, would be the ultimate engine of success, (a)fter all there is an element in the readjustment of our financial system more important than currency, more important than gold, and that is the confidence of the people. Confidence and courage are the essentials of success in carrying out our plan. You people must have faith; you must not be stampeded by rumors or guesses. Let us unite in banishing fear.”  

I thought about FDR’s chat when I came across a two rather startling set of polling numbers.

In the first, 52 percent of respondents agreed with the statement, “Nearly 70 years after the end of World War II, it’s time for our European, Asian and other allies to provide for their own defense.”  Only 37 percent agreed that, “As the world’s only superpower, the U.S. needs to continue to bear the responsibility of protecting our allies.”

In the second, only two months into his term as New York City Mayor, and just 4 months after he got more than 73% of the vote, Bill de Blasio has a 39% approval rating.  Or, put in simpler terms, you could say that Bill has managed to lose the support of roughly one-half of one percent of New Yorkers for each day he’s been in office. 

You might have thought that those two results came from the same poll; left-leaning, pacifist Manhattanites made crazy by the vortex of polar air and bad plowing.  But they don’t.  The first poll was taken at CPAC, the annual Obama-bashing hootenanny of conservatives.  Reliable reports indicate the only two New Yorkers in sight were Donald Trump’s hair and Donald Trump’s mouth.

How does a liberal Democrat lose the support of a liberal electorate so fast?  The same way that a meeting of right-wingers merrily flinging red meat could have a military and international tilt that seems, well, so not-very-right-wing.  It turns out that both CPAC and Bill de Blasio, and to a very considerable extent, the political parties that reflect their views, could stand to spend a little time learning something FDR knew intuitively; the trick to governing, at whatever level, is to identify a problem, show understanding of the impact on the average citizen, ask for and be respectful of their support,  and be authoritative in offering solutions. 

What has Bill done wrong beyond forgetting that in New York, after the first eight hours, people like their snow-piles in Vermont?  Substantively, not all that much.  His two most important appointees, Bill Bratton for Police Commissioner, and Carmen Farina for School’s Chancellor, are generally acknowledged to be experienced, knowledgeable, and competent. 

Non-substantively, he has a problem.  He hasn’t yet mastered messaging. It’s not possible to satisfy more than 8 million incredibly diverse and opinionated people.  But, if you can show that our priorities and cares are shared by you, we will, in our crabby way, cut you a considerable amount of slack.  de Blasio, by contrast, seems to have found a handful of things that jangle the ears, and that static is defining his Administration.  A de Blasio supporter told me yesterday “I don’t get it, I voted for him, I like him, and he doesn’t seem to be listening to me.”

Many of the younger CPAC attendees apparently had the same concerns with some of the speakers they heard.  They are conservative, free market, small government types, and they share a disdain for Mr. Obama, but they were also excited by Rand Paul’s libertarian ideas.  Santorum-style social conservatism doesn’t resonate with them.  They don’t see Snowden as a devil.  The Rubio/Bolton insistence on a military solution to every problem doesn’t appeal.  “Small government” means “small” to them—out of the economy, out of their pockets, and out of their emails and their personal lives.  Small government also means a smaller and less assertive military.  They know very well that when the neo-cons are looking to flex muscle, it’s their generation’s muscle (and arms and legs) that will end up being flexed.  In short, they aren’t your father’s conservatives, or Republicans.

This more libertarian attitude troubles and frightens many establishment types in the GOP and the conservative media.  They think if you are a Republican you should have fixed ideas on climate change, environmental and health and safety regulations, evolution, guns, abortion, contraception, domestic surveillance, prayer in schools, Common Core, charter schools, the use of military power, Obamacare, voting rights, gays, taxes, government spending, Cuba, immigration, etc. etc. 

The Millenials don’t. They agree with some, and don’t agree with others.  Which shouldn’t necessarily be seen as comforting to Democrats either, because those very same Millenials are also rejecting the Progressive menu.  They don’t think that every problem requires a government regulation, tax, or program.

What is interesting about this group, regardless of whether they like Rand Paul or Barack Obama, is their rejection of the jaded and cynical views of most of their elders.  They know that neither Democrats or Republicans, Conservatives or Progressives, really trust the average citizen to do the right thing—the only difference is whom to use the power of the state on to bring into line. 

The Millenials reject this, just as so many moderate and thinking people of any age reject it, even if they aren’t articulating it.   People are tired of being told what to do.  They are tired of the carping that passes for substance.  They are tired of politicians taking them for granted,  infantilizing them, or ignoring their real needs in order to pursue an agenda. 

Whether you are Mayor of the greatest city in the world, or aspire to govern the greatest country in the world, if you want to really accomplish something, you best be listening to FDR as he ended that first Fireside Chat.

“It is your problem no less than it is mine. Together we cannot fail.”

I would say we ought to give that a shot. 

Michael Liss (Moderate Moderator)

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Monday, March 3, 2014

Dave Camp's Devilishly Detailed Adventure

Dave Camp’s Devilishly Detailed Adventure

So, you want to talk about tax reform?  It has to be more fun then the Ukraine. 

I know it would be more colorful if I evoked images of Vladimir Putin (bare-chested) saddling up with his Cossacks to storm into Kiev and make a quick dinner of it.  But that all happened so fast that it looks like there’s nothing left besides the bones.  The deed is done, and there’s only time for the recriminations.  The Russians annexing “their” part of the Ukraine does evoke a certain creepy 1938 Nazis-into-Czechoslovakia feel to it, substituting aggrieved ethnic Russians for aggrieved ethnic Germans, complete with grateful throngs saluting the invaders.  But we all know how well that turned out.

Back to the taxes, a subject so exciting that by the time I’m done with this, we will be making Dave Camp a household name.

Dave Camp is the conservative, but amiable congressman from Michigan’s 4th District, an area that seems temperamentally moderate.  It went 54-46 for Romney in 2012, and supported George W. Bush, both times, by similar margins, but actually voted for Obama in 2008 and Clinton in both 1992 and 1996.  Camp himself has a lifetime 87.8 % rating from the American Conservative Union, which might bring him some credibility in more rational times. 

Camp has been working for many months on something that a lot of people like and support in theory: tax simplification.  In an ideal world pretty much all of us could do our taxes on the equivalent of a post card:  Here’s how much money we made, subtract our standard deduction and exemptions, multiply by a tax rate, write a check. Needless to say, that is not the most popular idea among the accounting and tax attorney set, but that’s why we have rich people, and the people who serve them.

And, therein lies a major part of the problem.  It’s not the potential rise in unemployment in the tax consultant field (they can always be repurposed) but the fact that all that complexity is tremendously profitable.  Because the tax code isn’t the redistributionist and confiscatory outrage that Republicans like to make it.  It is, in fact, a happy place where a handful of words can mean countless dollars.  Capital gains gets preferential treatment.  Carried interest gets preferential treatment.  Home-ownership gets subsidized, as does employer-provided health insurance, as does charitable giving, as does oil and gas exploration.  Even thoroughbred horse breeding has a special gimmie.   And that’s before we get into GRIT-ier and GRAT-ier areas of estate planning.

What this system does is create disparate impacts while hiding those impacts under a progressivity that the truly wealthy often avoid.  To paraphrase Leona Helmsley, only the little people pay the top rate.   Warren Buffet and Mitt Romney pay lower effective tax rates than the folk who empty their garbage cans at night—and they do it legally.  As did the more than 7,000 individuals who earned $1,000,000 or more in 2011, and paid absolutely no Federal Income Tax.  The next time someone utters “class warfare” to you, insist they first explain that.

Yet the phrase “tax reform’ has an implicit appeal.  We all hate taxes, so reforming them has got to be a good thing, and probably a profitable one.  Most of us think we pay too much, and others pay too little, so a little “reform” should mean something extra in our pay packets each week.

It certainly sounds good in theory, and so, presumably, we should have all be rooting for Dave Camp as he set off to make our lives simpler and more profitable.   The problem is them darn details.

Each journey has a starting point, and Camp’s was no different. He knew where not to go. Paul Ryan had shown the way, when, during the 2012 Presidential campaign, he refused to discuss the specifics of his tax reform plan.  What we do know of Ryan’s plan was that eliminated all taxes on interest, capital gains, and dividends, abolished the corporate income tax and estate taxes, and lower the top tax rate.  It made up the money by eliminating the deductions that benefited the middle and working classes. In Ryan’s world, the pay packets about to get thicker were already quite dense.

But Romney/Ryan knew they had a losing electoral hand if they disclosed the actual details of their plan.  That made it fairly obvious that Camp couldn’t sell a revision to the code that was so blatantly tilted in one direction.  Democrats would never sign on, and Republicans, while on board with Ryan’s emphasis, were aware that it couldn’t get through the Democratically controlled Senate.  It’s one thing to actually enact such a plan and reap the appropriate campaign contributions—you can always blame entitlements and labor unions later on for higher taxes and the deficit.  It’s another entirely to go on record as supporting taking more from the middle and working classes while not being able to deliver the legislation to the objects of your bounty.  That’s all pain, no gain, something that politicians have a bipartisan aversion to.

With his outside boundary defined, Camp started down what should have been the right road.  Last January, he broke things up into bipartisan working groups and got encouraging signs of consensus on key issues. He thought he could have hearing on the issues and then work towards a bill that had a strong chance of gaining a solid majority in both the Committee and whole House.  It would be an imperfect compromise, but a clear improvement over the status quo. But by spring, things started to go awry. Instead of having hearings on tax reform, Ways and Means shifted full time to into investigating Obamacare and the IRS, appreciably lowering the kumbaya quotient. 

This left Camp in a bind.  He wanted lower tax rates, funded, essentially, by the elimination of loopholes.  But while there was bipartisan support for the concept, the details were killers. When the Democrats met with Camp in July and proposed working together, they were told (at the GOP caucus’ insistence) that any deal had to include a reduction in the top tax rate to 25% and no new revenues.  That left very little to negotiate beyond how much more the middle and working classes would be taxed to pay for the additional benefits to business and the affluent.  This, they couldn’t sign on to, because all it would do would be to give the GOP both a substantive policy victory and political cover.

The net result was that Democrats pulled out, and the Republicans were never really in.  By October, the prospects of deal had all but collapsed.  Obamacare had a disastrous rollout, the GOP doubled down on the investigations and attempts to defund, and the entire effort dissolved into joint acrimony.

Last week, Camp ended his journey.  He finally released his plan to an audience that ranged from indifferent to outright hostile.  At least the Democrats were polite. The conservative media heaped scorn on it, and him. The Hill reports this morning that even his business allies oppose it.  His own party forgot to leave the light on for him; Mitch McConnell won’t agree to take it up, and the ever-literate John Boehner called it “blah blah blah blah.” 

The funny thing about all this is that pretty much everyone agrees that we need both tax and budget reform.  What Camp has discovered is what Romney and Ryan knew already.  Everyone is for tax reform—so long they don’t have to give up a thing. 

Maybe he should have just sent in the Cossacks.

Michael Liss (Moderate Moderator)

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