A Little-Noted Lesson from the Fiscal Cliff

Apparently, the country will be taking a leap off the so-called fiscal cliff, since–despite a flurry of last-minute activity and a vote by the Senate–midnight came and went without passing anything. (And even the Senate’s measure didn’t remotely resemble a “grand bargain.”)

For most of us, the tax consequences are likely to be short-term. Incredibly, a significant number of Representatives refused to vote in 2012 to terminate the Bush tax cuts for rich folks, but are perfectly willing to come back early in 2013 after the cuts have expired and vote to reinstate them just for the non-rich. Why is that, you might reasonably ask, when the result will be exactly the same? Because they can then tell their constituents they never voted for a tax increase. They evidently think the American public is really, really stupid–and we elected them, so maybe they’re right.

Then there’s the issue of spending cuts. If a larger deal cannot be negotiated, and the dreaded “sequester” goes into effect, we’re told that government spending will be sharply reduced. And that’s true–as far as it goes. But the nasty little secret is that government is no longer a word that describes…government. As in public sector employees and elected and appointed officials. After decades of privatization and contracting out, government is all of us and everywhere–defense contractors, civil engineers, social service agencies and other for-profits and nonprofits that depend upon government contracts to survive. The last analysis I saw–and it is now several years old–counted some eighteen million people working full-time at ostensibly private and nonprofit sector jobs that were wholly supported by our tax dollars.

Retrenchment in those government contracts–required by the sequester–will affect more than just those 18+ million people who are employed in what we might call the “quasi-government” sector. When the defense contractor loses his biggest customer, his suppliers lose theirs, and so on down the line. The economic contraction would be rapid and severe.

I say it “would be” because I believe that the reality of that outcome will quickly become apparent even to the less-than-brilliant policymakers in Congress. (Their constituents can be counted on to point it out, if they somehow don’t get it.) Call me Pollyanna, but I think we’ll see some sort of acceptable-but-not-ideal agreement early in January.

Even if we evade economic disaster via fiscal cliff-diving, however, it may be worth pondering the largely unrecognized extent to which the private and nonprofit sectors are now part and parcel of that “bloated and wasteful” government we routinely excoriate, and the extent to which demands for cuts in “government spending” threaten to reduce our own incomes. That’s certainly not an argument for unrestrained spending; it is, however, an argument for recognizing economic reality and the extent to which “privatization”–which has increased, rather than reduced, the size of government–has made necessary spending cuts infinitely more difficult.

Happy New Year.

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A Low Bar

Mitch Daniels will be leaving the Governor’s office next week, and the predictable “puff pieces” are popping up. Daniels will leave with a reputation for good stewardship, primarily because Indiana emerged from the recession in decent fiscal shape–at least if you gauge fiscal health by money in the state’s bank accounts rather than by the condition of its cities, towns and workforce. (By that measure, we don’t look so good…)

Which leads to a question none of these adulatory articles has bothered to address: how should we measure a Governor’s performance? What are the criteria for success as a state’s chief executive?

In Daniels’ case, those applauding his performance seem to set the bar pretty low. Yesterday, Matt Tully’s column celebrated the fact that Daniels actually made decisions. Granted, Tully has long exhibited what local political wags call  a “man crush” on the Governor, but he is not alone in suggesting that the mere fact that someone we elected actually did stuff is reason enough for praise.

So what “stuff” did Mitch do? Let me use Tully’s list: He leased the Indiana Toll Road. He led the fight for “Right to Work,” and was successful in adding property tax caps to the State Constitution. He was the moving force behind Tony Bennett’s approach to education reform. He revamped the BMV, and finally got Indiana on Daylight Savings Time.

Fair is fair: the BMV is a far, far better agency than it ever was before. It is efficient, user-friendly–I’d certainly give Daniels kudos for solving agency problems that defied his predecessors. I will also give him credit for Daylight Savings Time; it seems ridiculous that getting Indiana to go along with the rest of the country took so much political capital, but hey–this is Indiana, where one of our brilliant legislators worried aloud that an extra hour of sunlight would burn the crops. So props to the Guv for that one, too.

The rest of it, not so much.

The Toll Road deal was part and parcel of the conservative love-affair with privatization; it amounted to what one expert recently called an “intergenerational transfer,” meaning the state deferred expenses that will be paid by our grandchildren in return for quick and easy up-front cash that could be spent during Daniels’ term in office. (And spent it was–it’s all gone.)

Right to work was a payoff to the business interests that supported his campaigns.

The tax caps are strangling every urban area in Indiana–making it virtually impossible for Mayors to fund ongoing services, and forcing them into “rob Peter to pay Paul” deals to sell off public assets. Indianapolis is less safe, less clean, and less healthy; thanks, Mitch.

Whatever the merits of the education policies that Daniels and Bennett championed, it is hard to find anyone–education reform advocate or defender of the status quo–who has a kind word for their aggressive, slash-and-burn attacks on teachers.

I haven’t read all of the fawning articles, but the ones I’ve seen haven’t mentioned some of the other legacies Governor Daniels is leaving. There’s a state contract with a horribly expensive coal gasification plant in Southern Indiana, run by a company that employs Daniels’ close ally Mark Lubbers–a contract that ensures Indiana ratepayers will overpay for gas for the next 30 years. There’s the developing scandal involving the IEDC and Mitch Roob, another Daniels protege.

Tully and others acknowledge that there is “debate” about the consequences of many of his decisions, but they praise Daniels for the fact that he actually did stuff, that he “boldly” made decisions. That he changed things.

Apparently, that’s enough to earn their praise.

Talk about setting the bar low.

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It’s Us

The fault, dear Brutus, is not in our stars,
But in ourselves…

Shakespeare penned those words; Nate Silver demonstrates their accuracy.

The increasing partisanship and polarization in Washington is making it more and more difficult to get anything meaningful done. The paralysis of government is real, and it is making all of us vulnerable–to economic recession, to climate change, to gun violence and all of the myriad challenges of contemporary social systems. Those in what Molly Ivins called the  “chattering classes,” the punditocracy, bewail this state of affairs, and insist that the American public not only deserves better but deeply disapproves of this ideological rigidity.

Nate Silver begs to differ.

in a recent post for the New York Times, Silver demonstrates that the gridlock in Washington mirrors our own polarization. As recently as 1992, there were 103 swing Congressional districts; this year, there were 35. At the same time, the number of “landslide” districts doubled, from 123 to 242. As a result, most members of Congress now come from “hyperpartisan” districts where they face no general election threat. Any re-election challenge will come in a primary; in other words, Democrats must protect their left flanks, Republicans their right. As Silver notes, House members have little incentive to move toward the middle. Compromise with the other party simply makes them vulnerable to a primary challenge.

I have written about the pernicious effect of “safe” districts before, but I have generally assumed them to be the product of redistricting–gerrymandering. But Silver says the effect persists even if we ignore redistricting. He underscores what Bill Bishop reported in The Big Sort: people are voting with their feet, moving to areas they find congenial. The result is that Democrats are crammed into urban areas, and Republicans populate more rural districts. The result of that is the dilution of Democratic votes: in this year’s election, Democrats won the national popular vote by one point–an 8 point shift in their favor from 2010. But they gained only 8 House seats out of 435.

The results of these population patterns disadvantages Democrats by making continued control of the House by Republicans likely (absent a “wave” election), but it holds an even more serious threat to Republicans. As Silver points out, although individual Republican House members have little incentive to compromise, there are risks to the party if they fail to do so. Individual House members come from districts that reward them for being intractable, but that intransigence and hyper-partisanship make it increasingly difficult for the GOP to win either the Senate or the White House.

It seems appropriate, given how dysfunctional our government has become, to devolve from Shakespeare to Laurel and Hardy:  this is certainly a fine kettle of fish we’ve gotten ourselves into!

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What We Don’t Know and How It Hurts Us

Remember the old saying, “what you don’t know can’t hurt you”? Unlike a lot of folk adages, it’s wrong. Very wrong.

A lot of folks–especially younger people–shrug off the suggestion that they need to follow what our political class is doing. They have lives to live, livings to earn, children to raise, parties to attend. Let the politicians tend to governing.

This morning’s New York Times–buttressed by an article from the Journal of the American Medical Association–offers a prime example of why it’s important to keep tabs on Congressional shenanigans.

In the wake of the most recent horrendous shootings, of children in Connecticut and firefighters in New York, fingers have been pointed at the Bureau of Alcohol, Firearms and Explosives. ATF is theoretically an agency with the authority to thwart gun violence. But it has been without a permanent director for six years, thanks to the persistent efforts of Republicans in Congress to block any and all Obama appointments. Furthermore, it is hampered by laws lobbied for by the NRA and dutifully passed by Congress. As the Times notes,

Under current laws the bureau is prohibited from creating a federal registry of gun transactions. So while detectives on television tap a serial number into a computer and instantly identify the buyer of a firearm, the reality could not be more different.

So–unlike many countries–the U.S. doesn’t have a gun registry database. The NRA thinks such information would “pose a threat to the Second Amendment.”

In fact, the NRA evidently thinks that information would pose a threat to their version of the Second Amendment.

A former student who went on to get his doctorate in medical informatics sent me a recent Viewpoint from JAMA, the Journal of the AMA. After detailing several of the most recent mass shootings, and noting that in the U.S. more than 31,000 citizens die annually from firearms, the authors note research findings that ready access to guns in the home “increases, rather than reduces” a family’s risk of homicide in the home.  Then they make their main point:

The nation might be in a better position to act if medical and public health researchers had continued to study these issues as diligently as some of us did between 1985 and 1997. But in 1996, pro-gun members of Congress mounted an all-out effort to eliminate the National Center for Injury Prevention and Control at the CDC. Although they failed to defund the center, the House of Representatives removed $2.6 million from the CDC’s budget–precisely the amount the agency had spent on firearm injury research the previous year.

The funding was restored in joint conference committee, but only on condition that it be earmarked for traumatic brain injury. And the following language was added to the final appropriation: “none of the funds made available for injury prevention and control may be used to advocate or promote gun control.”

Similar language has been added to funding for the National Institute on Alcohol Abuse and Alcoholism, after a research study was funded by that agency to determine whether carrying a gun increased or decreased the risk of firearm assault. The article went on to detail similar restrictions on other agencies.

A couple of rhetorical question: why doesn’t the NRA want the American public to have good information about gun violence? and why does a majority of Congress do its bidding?

A not-so-rhetorical question: when will citizens of this country say “enough!”

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