Blog entry

Toward A New Washington Consensus

David Sirota — Fri, 16 May 2008 12:08:06 -0400

Join the book club for David Sirota's upcoming book, The Uprising, due out on 5/27.

For all the talk from "free trade"-backing politicians about needing to engage the world, most of them understand almost nothing about how the world sees our international economic policies. As I show in my new newspaper column this week, our so-called Washington Consensus policies on globalization are stirring a backlash in both the industrialized and developing worlds.

To report this column, I conducted exclusive interviews with two foreign leaders - Jack Layton, head of Canada's New Democratic Party, and Otton Solis, the Costa Rican economist who formed a new political party in his country that almost won the presidency. Both of them expressed deep concerns about NAFTA-style trade deals - not only because those deals empower corporations to overturn laws passed by democratically elected governments, but because they aren't "free" in any sense of the word - they include all sorts of protectionist provisions for corporate profits. And as the column shows, their sentiment is backed up by public opinion in their parts of the world.

This is all very relevant because - if you hadn't noticed - a heated debate over trade and globalization policies is currently occurring in American politics. As Democrats sharpen their fair trade talk and promises, people like John McCain are making wild accusations claiming that such moves will alienate the rest of the world - when in fact the actual public opinion data shows precisely the opposite. Far from quelling anti-Americanism and building diplomatic bridges, our current trade policies exacerbate anti-Americanism and burn what few diplomatic bridges we have left.

This isn't to say that the rest of the world is "anti-trade." That's the tired, cartoonish phrase that the "free" trade extremists use to describe anyone who wants a new trade policy (and I put "free" in quotes because, as Solis notes in my column, "free" trade deals are protectionist - they are just protectionist for corporations). Progressives here and abroad are all for trade and commerce - they just want the rules of trade to protect people and the environment, before they protect corporate bottom lines.

The problem, of course, is that the debate over globalization has left the "reality-based" world. While reformers are arguing with actual facts, figures and history, the Establishment argues with empty rhetoric that actually thumbs its nose at facts. Remember, it was none other than Tom Friedman - America's leading cheerleader for status quo trade policies - who actually went on national television and bragged that "I wrote a column supporting CAFTA. I didn't even know what was in it. I just knew two words: free trade." That's right - in the face of growing global animosity to America's trade policy, our country's leading Republican displays no understanding of trade policy, and our country's leading "intellectual" thinker on trade trumpets the fact that he advocates for trade deals that he doesn't even bother to read.

You can read the whole column at the San Francisco Chronicle, Denver Post, Ft. Collins Coloradoan, In These Times, TruthDig, Credo Action, or Creators. The column relies on grassroots support, so if you'd like to see my column regularly in your local paper, use this directory to find the contact info for your local editorial page editors. Get get in touch with them and point them to my Creators Syndicate site. Thanks, as always, for your ongoing readership and help contacting local editors. This column couldn't be what it is without your help.

Check the NY Times Magazine This Sunday

David Sirota — Thu, 15 May 2008 14:08:57 -0400

Just wanted to let regular readers in on a project I've been toiling away at for some time that's now coming to fruition. I am scheduled to have a piece in this Sunday's New York Times Magazine that deals with some interesting issues boiling up in key swing states. I'll have more to say about the article when it comes out, but that's all I'll say for now. Be sure to check it out when it comes out and send me your feedback.

Do Conservatives Really Want to Shed the "Block-and-Blame" Label?

Isaiah J. Poole — Thu, 15 May 2008 11:41:02 -0400

It is, as our co-director Robert Borosage pointed out this week, ludicrous on its face. House Republicans, coming out of their weekly caucus on Wednesday, started touting their latest slogan, "the change you deserve," and they are being virtually laughed out of the room.

In the meantime, Republicans are engaging in a degree of hand-wringing that hasn't been seen in the party since the post-Watergate days. National Republican Campaign Chairman Rep. Tom Cole, R-Okla., was quoted in Politico:

“A large segment of the American public doesn’t have confidence in the Republican Party to deal with the issues in front of us. What we have to do is look in the mirror a bit and ask how we lost our way.”

Well, Mr. Cole, maybe conservatives like you might learn how to say "yes" to what the American people want rather than continue your obstructionist, block-and-blame strategy.

To take just one example, you and House Minority Leader John Boehner could have worked more cooperatively with Democrats last week on a mortgage relief bill. House Banking Committee chairman Rep. Barney Frank, D-Mass., has been getting mainstream media kudos for bending over backwards to listen to the Bush administration and find common ground. Yet, when the final legislative package went to the House floor last week, it was met with a veto threat from President Bush and stubborn rejection from a majority of House Republicans.

Washington Post columnist Steven Pearlstein's take on what happened fits the block-and-blame narrative:

Why the House Republican leadership decided to oppose the bill remains a mystery. The most charitable explanation was that it ran afoul of its free-market ideology. The more likely explanation is that it understood that the economy had become the most salient political issue in the coming election, and it was determined to deny the Democrats who control Congress the chance to show they had done something about it.

Whatever the reason, Republicans leaders were apparently successful in pressing the White House to stop negotiating with Frank and oppose the legislation. Suddenly, Treasury officials who had signed off on the portions of the bill dealing with Fannie (Mae) and Freddie (Mac, the two major mortgage financing institutions) began raising new objections. And the White House announced that President Bush would veto the bill, calling it a bailout for speculators and lenders and complaining, alternatively, that it would not help many homeowners and that it would cost far more than the estimated $2.5 billion over five years.

At the time of this writing, a decent mortgage relief compromise might yet get past the conservative naysayers in the Congress and past the biggest naysayer of all, George W. Bush. But conservatives still show few signs of realizing that they are paying the price for a strategy of obstruction that, after Democrats took control of the Congress in 2006, they deliberately and systematically followed.

Even the memo House Republican leaders sent to their members on Tuesday is stuck in block-and-blame-ism, accusing the Democrats of "promises made, promises broken" when, in fact, dozens of bills passed by the House Democratic majority have been snagged in the Senate by an obstinate Republican minority.

The Republicans are right about one thing in that memo: "This has to change. It must change." But that change will have to start with conservatives recognizing that the American public is not interested in more of their government-off-your-back-and-into-my-pocket ideology. Americans want an economy that offers them a fair chance to prosper, and since conservatives have had their chance to bring that about and have failed, they should get out of the way.

How Progressives Can Be Making Sense in 2008

Bernie Horn — Thu, 15 May 2008 10:18:54 -0400

Let me tell you about a new project from Campaign for America’s Future called "Making Sense 2008." Or, if you want, skip this advertisement and go right to the project’s first set of talking points.

I’m sure it’s no surprise to you that most Americans are progressive on most issues. By margins of at least two to one, our fellow citizens believe corporations and upper-income people are paying too little in federal taxes; oppose repealing the federal estate tax; favor quality, affordable health care for all “even if it means raising your taxes”; support the idea that the federal Medicare program should negotiate prescription drug prices directly with pharmaceutical companies; want federal action to address global warming; would require auto manufacturers to make cars more energy efficient; say laws covering the sale of handguns should be more strict; think labor unions are necessary to protect workers; believe that gays and lesbians should be able to serve openly in the military; and do not want the Supreme Court to overturn Roe v. Wade.

That’s the good news. Here’s the bad. Most Americans also support traditional conservative principles—limited government, lower taxes, free markets, and personal responsibility. (Yes, friends, polls persistently show this.) In other words, a large group of Americans favor both progressive policy and conservative philosophy. As a result, they may side with either progressives or conservatives, depending on how a political question is framed.

These are the persuadable voters. They’re the ones who will make the difference in the 2008 election because, unlike the progressive/Democratic or conservative/Republican base, they can be persuaded to join either side. And the only way to persuade them is to address issues that are most important to them in language that appeals to them.

Here’s my point—I doubt that very many of this column’s readers are persuadable voters. You’ve made up your mind already. So you’re different than the people we have to convince. Compared to persuadable voters, you may have a different set of concerns and somewhat different values, and you undoubtedly pay more attention to political news, know more political facts, and make different assumptions when thinking about issues.

In short, if an argument appeals to you—a committed partisan—it probably doesn’t appeal to persuadable voters!

So I’m asking you to do something that is not natural for progressives—take direction from poll-tested message frames. How will you know what to say? Making Sense 2008 will produce and distribute research-based talking points on a variety of issues during the election season.

\The first is about McCain’s health care plan and you can see it here: http://www.ourfuture.org/makingsense2008. If you want to receive these talking points—sent about once a week at first and then more frequently as Election Day approaches—please sign up by clicking here.

There’s no doubt that George W. Bush’s administration has been a catastrophe, and that historians will one day rank him as one of our nation’s very worst presidents. That’s why this election is so critical—the very soul of America hangs in the balance. We’ve got to take back America, and soon, before solutions to national and global problems slip beyond our reach. I know you’re going to work your hearts out. Let us help you become a more effective advocate.

Living Standards Under Stress

Isaiah J. Poole — Wed, 14 May 2008 11:50:49 -0400

It does not take much to understand why a hard-core Republican district in Mississippi would elect a Democrat to the House of Representatives by a nine-point margin. Mississippi is a state under particularly serious economic stress, a point brought home in a report released this week by the Campaign for America's Future.

"The Stress Test" shows in graphic detail the impact that seven years of conservative economic policies have had on working families. It explains why this week's Washington Post-ABC News poll indicates that "nearly seven out of 10 Americans are worried about maintaining their standard of living."

The most recent, and perhaps most dramatic, threat to standards of living has been in the form of higher gasoline prices, which have risen 33 cents a gallon just in the past month, according to The Post. But the erosion in living stands has been a long time coming and it comes from multiple sources, according to the Stress Test report.

Consider this: In Mississippi, since 2000 the average weekly wage has done up, in inflation-adjusted terms, $33 since 2000. But there are plenty of indications that Mississippi families have nonetheless fallen behind, even if you leave out the whopping 128 percent increase in gasoline prices during that period. The percentage of people without health insurance increased 63 percent since 2000, and the number of jobs with health coverage declined 12 percent. Seventy-four percent more people—it's now almost one in 10—spend at least a quarter of their income for health care than was the case in 2000.

In Mississippi, the number of people who are below the poverty line is up 8 percent, bankruptcies are up 27 percent and home foreclosures are up 92 percent.

On a national level, "The Stress Test" reports:

The states experiencing the most economic difficulties are Michigan, North Carolina, Ohio, Maine and Tennessee. A cross‐section of middle America, these states are represented by both political parties and exhibit both industrial and rural characteristics. Michigan’s number one ranking in stress reveals America’s shrinking industrial base. It has high unemployment as well as the biggest decline per capita in both manufacturing jobs and construction jobs. North Carolina’s high ranking also stems from crumbling industry, which led to its having the fourth highest decrease in goods‐producing jobs and third highest decrease in manufacturing since 2000. North Carolinians are also plagued by health care woes. Thirteen percent fewer people in North Carolina got health care through their employers in 2006 than in 2000. Nine percent of the residents of North Carolina pay more than 25 percent of their income on health care. In Ohio, more than one in ten construction jobs has been lost since 2000. The cost of a year of state college is now up to 20 percent of a median Ohio family’s income.

It is no wonder conservative lawmakers this week are trying to sell "change," as if it were someone else besides President George W. Bush in the White House and as if conservatives weren't running the Congress like a military precision marching band until voters said "Enough!" in 2006. The Stress Test shows that real change will not come from more of the same, but from a radically different set of progressive economic policies. We need to focus on supporting the aspirations of working-class families, not the avarice of corporations. There is no better proof of that than the conditions on the ground in conservative strongholds like Mississippi—and in how voters are responding behind the voting-booth curtain.

The Hostile Takeover of Tax Enforcement

David Sirota — Wed, 14 May 2008 10:29:35 -0400

In case you thought the hostile takeover of our government by Big Money interests ended with the 2006 election, think again:

"Pentagon contractors under scrutiny for setting up shell corporations in offshore tax havens are looking to the Senate as a line of defense against legislation that would curb such transactions. Sen. John Kerry, D-Mass, wants to attach language cracking down on the practice, which he authored with Democratic presidential hopeful Sen. Barack Obama, D-Ill., in the next tax bill that moves through the Senate. But leading Senate tax-writers are still considering whether to back the Kerry bill. Sen. Max Baucus, D-Mont., who chairs the Senate Finance Committee, is reviewing the bill."

"Reviewing" - such a harmless sounding euphemism. But it's probably not:

"Senior employees of L-3 Communications Holdings Inc. (LLL) - parent company to MPRI, a defense contractor that has been the focus of scrutiny - donated generously to Baucus' re-election effort in March, according to federal records compiled by the Center for Responsive Politics. Those donations, made between March 19 and March 31, came from 14 top employees of L-3 and totaled $12,750, the records show. Most contributions were for $1,000, including from Ralph D'Ambrosio, chief financial officer, Charles J. Schafer, president of the firm's products group, and Curtis Brunson, senior vice president. The donations came just days after a March Boston Globe report revealed that KBR pays thousands of its personnel through a Cayman Islands affiliate."

This issue is about as pure as it gets in terms of corruption. As Dow Jones notes, if these loopholes aren't closed, these defense companies will "escape paying the employer's share of Social Security and Medicare taxes" to the tune of almost $1 billion dollars over the next decade. Baucus - widely known as K Street's favorite Democrat - is in a position to block, water down, or support the Kerry-Obama bill. What he decides to do will tell us just how much the culture of corruption still dominates Washington.

Let's Bank On Rebuilding America

Isaiah J. Poole — Tue, 06 May 2008 11:48:40 -0400

Instead of a silly argument over a "gas tax holiday," we desperately need a serious discussion about the nation's infrastructure. And there is a good legislative proposal that could be the basis for that discussion.

There are bills in the House (HR 3401) and the Senate (S 1926) that would create a national infrastructure bank. It could be one way to bring some common sense to the task of rebuilding America's roads, bridges, sewers and public buildings. The creation of this bank should be part of the effort progressives are making in Congress to enact a second stimulus bill this month.

Such a bank would allow the federal government to finance these projects in the same way that states do: by issuing long-term, tax-exempt bonds or by making loan guarantees.

Both Sens. Hillary Clinton and Barack Obama have said they support the idea of an infrastructure bank, although it rarely comes up in their campaign speeches. And that's a shame, because they both need to spend their time reinforcing an emerging national mandate for repairing and improving our crumbling foundations.

Just last month, the blog Infrastructure Watch notes, the Government Accountability Office estimated that the nation's total water infrastructure needs would cost between $485 billion to $1.2 trillion. However, funding for the largest federal drinking water and wastewater infrastructure programs have been flat or declining.

Also, the Congressional Budget Office told Congress last year that the Highway Trust Fund, which is made up largely of the revenue from the gasoline tax, will run out of money in 2009. Spending is outpacing money flowing into the fund. (High gasoline prices, in fact, worsens that problem. When high prices force cutbacks in driving, less money flows into the fund; the federal gasoline tax is a per-gallon tax; it does not increase proportionately to the cost of a gallon of gasoline.) One key reason for the exhaustion of the fund is that prices for materials such as asphalt and concrete are exceeding the general rate of inflation.

In March, the president of the American Society of Civil Engineers, David G. Mongan, reminded the House Banking Committee that in 2005 the organization gave a grade of "D" to the state of the nation's infrastructure and said that an investment of $1.6 trillion by 2010 would be needed to bring the fix these public resources. At the time, that bad grade got a fair amount of attention. Since then:

Nothing approaching that level of investment has been made. Indeed, little has changed in the three years since we handed out that dismal grade, and establishing a longterm plan to finance the development and maintenance of our infrastructure remains a pressing national priority.

This nation continues to under-invest in infrastructure at the national level. The total of all federal spending for infrastructure as a share of all federal spending has steadily declined over the last 30 years, according to the Congressional Budget Office.

One of the more shameful examples of what Robert Kuttner adroitly calls "the squandering of America" is the failure of America to take care of its basic public assets, especially after the Bush administration inherited a government with a budget surplus that gave it the leeway to tackle that challenge intelligently. (Colleague Bill Scher has linked to some NBC News reports on how we're literally falling apart and is asking why the media, including NBC, isn't doing more to press this into the national debate.) Under the guise of controlling spending, the administration has shifted an increasing share of the national burden to state and local governments—where the same conservatives who say the federal government shouldn't tax to pay for these needs make the same argument at the state and local level—or encouraged turning public assets into private profit centers.

Now that the country is moving through a recession, there is an even more critical need to target government resources on projects that will produce jobs in the short run and leave the nation in the long run with the clean water, transportation, schools and other public facilities that a nation needs to be healthy and economically vibrant. As Congress considers a second economic stimulus package for short-term relief this month, it should authorize the creation of that infrastructure bank. Then let's have a serious debate about how to fund it and how to use it when the next president takes office.

The Housing Crisis and The Plague of Potomac Fever

David Sirota — Fri, 02 May 2008 08:10:53 -0400

We have been trained to think of states as the supposed "laboratories of democracy," but what they really are these days are a check and balance against federal inaction and Potomac Fever. That's the case I make in my newspaper column out today - especially as it relates to the housing crisis.

Last month, this situation was exemplified by the front page of the Washington Post. On one side was this story, headlined "Housing Accord Puts Builders First; Strapped Homeowners Offered Little Aid." On another side of the page, was this story, headlined, "Sweeping Bills Passed To Help Homeowners." The former was about Congress moving to use the housing crisis as a justification to give Big Money interests yet another taxpayer-funded handout. The latter was about state lawmakers using their power to better regulate the financial industry and try to help regular folks.

Such a contrast has been seen all over the country. As states move to crack down on predatory lending and abusive mortgage fees, lawmakers like Rep. Barney Frank, D-Mass., have been telling reporters "it's irrelevant" how many—if any—homeowners are ever helped by anything Congress does in reaction to the housing crisis. As state legislators use their platforms to demand serious aid to borrowers, Washington moves to construct a bailout for financial firms.

This is the contrast between minimally healthy (though certainly imperfect) democratic systems in the states, and a federal government ravaged by Potomac Fever—the illness whereby professional politicians forget who they were elected to serve. I offer some ideas on what precisely causes this kind of Potomac Fever in the column, and how state action may be the only hope to shock that disease out of the system.

Whether that happens or not, however, states are leading the way on the major issues of the day - as they always have. The progressive movement tends to be almost solely focused on Washington, D.C. and federal elections - but as the Right showed throughout the 1980s and 1990s, states are where the rubber really hits the road on major issues - and especially money issues (and this is why, for instance, I devote so much of my time, energy and activism to the Progressive States Network).

You can read the whole column at the San Francisco Chronicle, Denver Post, Ft. Collins Coloradoan, Credo Action, In These Times or Creators. You can listen to a podcast of the column here. The column relies on grassroots support, so if you'd like to see my column regularly in your local paper, use this directory to find the contact info for your local editorial page editors. Get get in touch with them and point them to my Creators Syndicate site. Thanks, as always, for your ongoing readership and help contacting local editors. This column couldn't be what it is without your help.

Nightline: Important Questions In the Black Community Aren't "Real"

David Sirota — Thu, 01 May 2008 11:30:14 -0400

Sometimes racial denigration is easy to see - think white police officers in the segregation era using hoses to stop peaceful protests. Other times it is more subtle - like a few days ago on ABC's Nightline.

I don't usually watch the show, but I happened to be flipping through the channels on Tuesday, when I caught the program's predictable piece on Reverend Jeremiah Wright. Here was how correspondent David Wright (no relation to Jeremiah) concluded his piece:

DAVID WRIGHT: Many black leaders had no comment on today's developments. Obama could yet pay a price in the black community.

REVEREND AL SHARPTON: Some are going to agree. I think some are going to disagree vehemently.

DAVID WRIGHT: But the real question now is what do white voters think, especially the white voters of Indiana. They weigh in on Tuesday, and Obama's hoping there's enough time to convince them that he and his controversial pastor have gone their separate ways for good. (emphasis added)

So according to Nightline, there are questions about the painful and deep fissures the Obama-Wright issue is causing in the black community, but those aren't "real." No, "the real question is what do white voters think" - and, according to ABC, they - and only they - "weigh in on Tuesday" (apparently, Indiana's black population doesn't get to weigh in...did someone suspend the Voting Rights Act in Indiana?).

David Wright is white, and probably didn't even have a clue that what he said is a very clear message that he - and the people at Nightline who edited his piece - really don't see black people, or even the black vote, as important - or, in their words, "real." In fact, if they go back and consider this at all, they will probably tell themselves they didn't mean it that way - though that doesn't make it any better. Very often the true beliefs of public figures comes out in Freudian slips.

I mean, it just doesn't get any more overt than that when you think about it. Here is a show that beams out to the entire country, and one of its reporters concluded a piece by telling 37 million African Americans that the issues in their community do not matter - an especially galling message, considering the Obama-Wright controversy is one inherently about tensions within the black community, and is also being exploited by the media and opposing campaigns through not-so-subtle racial politics. And yet, not a single media watchdog group - progressive or otherwise - nor anyone at ABC publicly criticized this. Most likely, no one even noticed.

Sadly, this kind of thing is the norm in American political culture - and particularly in the 2008 presidential campaign, whether through the downplaying of the black vote's importance, or through people like Chris Matthews suggesting that black people aren't "regular people." The political Establishment likes to talk about racial equality and Santa Claus-ify Martin Luther King, but the denigration continues.

Join the book club for David Sirota's upcoming book, The Uprising, due out on 5/27.

A Little Love for Big Oil

Robert Borosage — Thu, 01 May 2008 10:27:01 -0400

Oil companies report record profits. Gas is headed towards $4 a gallon. A caravan of more than 100 truckers rallied in Washington Monday to protest diesel fuel prices already over that mark. Across the country, Americans are getting pinched by rising fuel and food prices.

So politicians, as Rev. Jeremiah Wright would say, "do what politicians do." Arizona Sen. John McCain offers up a temporary "gas tax holiday," suggesting the Congress suspend the 18.4-cent federal tax for the summer, at a cost of about $10 billion in money earmarked for highways, bridges and other transportation projects. Not to be outdone, New York Sen. Hillary Clinton instantly agrees, adding she'd replace the money to the highway fund with an excess profits tax on oil companies. Both immediately scorn Illinois Sen. Barack Obama as "elitist" for saying that it is a "bad idea." Now this exchange will be a staple of the talk shows whenever gas prices go up.

Now neither McCain, married into a $100 million fortune, ushered about in his wife's corporate jet, nor Clinton are exactly convincing populists. But McCain knows this is political gold, offering folks "a little bit of relief so they can travel a little further and little longer and maybe have a little bit of money left over to enjoy some other things in their lives."

Only there's one small problem with this tax cut: The oil companies are likely to pocket most of it.

Rising demand for gas and oil has driven prices up around the world. In this country, the oil companies say their refineries are pumping out as much gas as they can, so prices are likely to rise even higher this summer as Americans set out on family vacations. They can sell all the gas they can produce at $3.50 to $4 a gallon, including the 18 cents in gas taxes. So McCain and Clinton revoke the gas taxes. Is there any reason to think that the oil companies won't continue to sell their gas at the $4 a gallon that it already commands, and pocket the difference?

Economist Dean Baker of the Center on Economic and Policy Research calls it a "summer tax break for Exxon," noting, "We have a fixed amount of gas entering the market, the question is simply what price clears the market. If we reduce or eliminate the gas tax, the price doesn't change, the lower tax will simply allow Exxon and other oil companies to keep more profits."

This is economics 101, a subject that McCain admits is "not something I've understood as well as I should." (He later denied making the statement.) Obama isn't an economist either, but he's had experience with gas tax holidays in Illinois. As The Washington Post reports, Obama voted for a six-month suspension of Illinois' gas tax in the summer of 2000 when prices soared to a then-obscene $2 a barrel. The state lost about $175 million in revenue; the price of gas fell by an average of 3 percent, suggesting that about 60 percent of the savings were passed on to consumers.

But any increased demand that might have resulted in Illinois from cutting the tax could be accommodated by transferring gas from another state. In a federal program, any increased demand from an initially lower price would drive that price back up to its current market clearing levels. There are only two ways to lower the price—increase supply or decrease demand. McCain and Clinton's tax cut would do neither of these.

That, of course, won't stop either of them from peddling the tax and from scouring Obama for being "out of touch." For Clinton, this is just part of the "kitchen sink" she's throwing at Obama. For McCain, inconvenient truths don't seem to matter. He knows what he thinks and doesn't want to be confused with facts. Capital gains tax cuts always generate more revenue. Al Qaeda is the biggest threat in Iraq. Corporate trade deals don't hurt wages. Privatization of Social Security will make seniors more secure. And don't worry, big oil won't charge what the market will bear for the price of gas.

A version of this post appeared on HuffingtonPost.com.