Sunday, October 27, 2013

Afterword and Foreword

This post is both an afterword to my last post and a foreword to a series I want to post in a very slow and meandering fashion.  I been obsessed for some time with how democratically elected governments fail. I only know much detail about two examples -- Germany and the United States.  (And let's face it.  When democratic politics fail to resolve the foremost issue of the day, resulting in a civil war with 600,000 dead, that has to be considered a failure of democracy).

At the same time, it is inspired in large party by a comment to a prior post in which I measured the traits professional historians associate with fascism against the Tea Party to see how they match up.  My conclusion:  The Tea Party has several of fascism's mobilizing passions but lacks a charismatic leader.  If it adopts charismatic leader like Ted Cruz, it would meet most of the mobilizing passions.  It has two out of three fascist negations, i.e., it is anti-radical and anti-liberal, but not anti-conservative.*  But it is not fascistic in its methods (although its methods are alarming in other ways) and it shares none of fascism's ideology and goals.  My commenter believed that the Tea Party, although not classically fascist, was still alarming, and that American fascism might not take the same form as classical European fascism.

This brought to my mind my earlier analysis of the Ku Klux Klan and its resemblance to fascism.  My conclusion:  The Klan shared most of fascism's mobilizing passions except for lacking a charismatic leader; it was also anti-radical and anti-liberal, but not anti-conservative; it was fascistic in its methods except that it lacked a charismatic leader; but it had none of the classical fascist ideology and goals.

Going by my very cursory knowledge about the failure of democracy in countries other than the US and Germany, I have several preliminary hypotheses:

  1. Democracies fail as a result of extreme, out-of-control polarization and strife;
  2. Simultaneous a cause and a symptom of such polarization are parties that abandon all respect for the rules of the game and democratic fair play and pursue victor at all costs;
  3. Political violence is a very bad sign;
  4. Although violent revolution from the Left is a real danger under authoritarian governments, the danger to democracy is usually from the Right.
Qualifying this last statement, I would add that a radical anti-democratic Left can certainly exist and add to the polarization, but it is usually the Right that emerges dominant.  I would further add that one sign that a right-wing party is dangerous is that it loses its ability to distinguish between the radical Left and the moderate Left that respects democratic fair play.  I will further add that sometimes the radical Left does bring down democracy, but most examples I know of fall under two main categories.  One is Eastern Europe following WWII, when democratically elective governments fell to the Communists.  But whether that would have happened in the absence of the Red Army is an open question.  The other is that governments that are formally democratically elective, but have informally degenerated into cozy little oligarchies are vulnerable to left wing, populist dictators, like Julius Caesar, Huey Long, or Hugo Chavez.

Looking at the two examples I know most about, I would say that both the secessionists and the Nazis are properly characterized as right wing.  But they are right wing in very different ways.  The secessionist of the 1850's (or the Tea Party today) are right wing in the sense of being reactionaries, standing athwart history, yelling stop!  The Fascists and Nazis were something different altogether -- right wing, but emphatically not conservative.  They won the alliance of conservatives with a promise to crush the Left, but they also aspired to major changes and transformations of society that were not conservative (the fascist ideology and goals).  

So I want to look at various democracies that have failed and see both what went wrong and how well the various fascist traits apply to democracy's enemies.  It may turn out that the mobilizing passions, negations, and methods of fascism are common among enemies of democracy, but the fascist ideology and goals are an anomaly.  Or it may turn out that fascism is more widespread than we realize.  I don't know.  But I hope to learn a lot.

*I imagine some conservatives would disagree with me and say that making opposition and conflict ends in themselves, shutting down government, and threatening a debt default with untold consequences are not conservative at all.  Point taken.

Tea Party Today: Democrats in the 1850's?

Let me start by stating the obvious.  I do not believe that the Tea Party wants to secede, or that there is any danger of secession by red states, or any threat of civil war.  So in that sense, the Tea Party is nothing like the Democrats of the 1850's.  But in an attempt to find some sort of parallel in our history, I have been looking at books about that fateful decade that was the countdown to the Civil War, and I see a dynamic in Southern Democrats that bears a certain resemblance to the Tea Party today.

To understand the 1850's, one must go back at least to the Missouri Compromise of 1820.
The northern state dominated the House of Representatives because of their larger population, but Congress made a habit of admitting slave and free states in equal numbers to maintain the balance in the Senate.  In 1820, Missouri applied for admission as a slave state, threatening to tip the balance.  Some northern Congressmen sought to require Missouri to phase out slavery as a condition of admission.  In the end, the sides compromised.  They admitted Missouri as a slave state and Maine as a free state, but barred slavery in the Louisiana Purchase south of Missouri's southern border (the 36th parallel).*  A look at the map above shows why this could not possibly have been the basis for a stable compromise.  The territory closed to slavery was much larger than the territory open to it. Indeed, the only slave state subsequently admitted from the Louisiana Purchase was Arkansas.  But the Southern states on the whole expanded territorially faster than the northern states and were always eager to add more territory to the US.  The addition of Florida and Texas (and the possibility of breaking Texas into as many as five different slave states) maintained the balance in the Senate for a surprising thirty years.

The Union threatened to fray again in 1850 when California applied for admission as a free state, including the portions the were south of the Missouri Compromise Line.  This set off a crisis because it would tilt the balance of the Senate permanently in favor of the North.  After much wrangling, Congress reached a compromise.  California would be admitted as a free state, including the portions south of the 36th parallel.  In return, Utah Territory, though north of the line, would be allowed to adopt slavery if it chose.  There was not too much resistance to this proposal in the North for at least three reasons: (1) The Missouri Compromise technically only applied to the Louisiana Purchase, so it was not technically violated by allowing slavery north of the line in other territory.  (2) No one expected slavery to be established in Utah.  (3) Even if by some miracle, slavery were to be established in Utah, Utah was much poorer and less populous than California so the North got decidedly the better end of the bargain.  In fact, the Utah for California bargain was so lopsided that the Compromise of 1850 added a tougher fugitive slave act as a sweetener to bring the South along.

The next crisis occurred in 1854, when Kansas and Nebraska were opened up for settlement and territorial status.  Since both territories lay in the Louisiana Purchase north of the Missouri Compromise line, both would normally be closed to slavery, but the South was in no mood to tolerate the admission of any more free states.  Stephen Douglas in the Senate therefore cut a deal with the South to repeal the Missouri Compromise line and open these territories to popular sovereignty, i.e., to let the inhabitants decide whether or not to allow slavery.  Opening Kansas and Nebraska to slavery set off a much greater uproar in the north than opening Utah to slavery.  The Missouri Compromise was widely seen in the north as a sacred compact and its repeal as something monstrous.  It was in response to the Kansas-Nebraska Act that the Republican Party was formed, dedicated to preventing any further expansion of slavery.  No one expected slavery to have any success in Nebraska, Kansas was right across the border from the slave state of Missouri, and parts of eastern Kansas might have been adaptable to raising tobacco.  Many Southerners saw an implied bargain -- Nebraska as a free state for Kansas as a slave state.  There was a huge rush of Northern settlers into Kansas -- a minority, mostly from New England, moving there specifically to keep slavery out, and a majority, mostly from the Midwest, seeking a better future, indifferent to slavery as a moral issue, but not wanting slaves as competition.  "Border ruffians" crossed over from Missouri to vote in Kansas elections and intimidate settlers, but few who became permanent settlers.

This raises an interesting question.  Why did California seek admission as a wholly free state?  And why couldn't pro-slavery settlers keep up with the anti-slavery settlers in Kansas?  It is commonly said that by 1850, slavery had reached its natural limit because all new land acquired by the US was simply too dry to be good for plantation agriculture.  But California today is the US capital of plantation agriculture (in the sense of large-scale, labor-intensive cultivation of cash crops), and at least parts of Kansas were hospitable to tobacco.  The answer appears to be that decades of rapid expansion had spread the South thin.  It had an abundance of uncultivated land and a shortage of (slave) labor. It simply did not have enough people to keep expanding.  The North, by contrast, had a more rapidly growing population because the bulk of immigrants were going there.  Parts of its growing population were building cities and industrial development, but other parts were heading west -- and did not want to compete with slaves.  In short, slavery had reached its limits, not just because of geography, but because of demography.  Much of the South's actions throughout the 1850's might be seen as an attempt to legislate away basic geographic and demographic facts.  Needless to say, the attempt was not successful.

At the same time, the South held surprising domination of the federal government by a sort of 19th Century version of the Hastert Rule -- government by the majority of the majority.  The South was a minority region, but it held the majority of the Democratic Party, which, in turn, was the majority party.  Nonetheless, Northern Democrats were increasingly beginning to chafe under Southern domination.  They might not care about slavery as a moral issue, but the Kansas-Nebraska Act had hurt them, and they were becoming restive.  This was clearly born out in the Democratic Convention of 1856.  Initially, Southerners' favorite candidate was the incumbent President, Franklin Pierce.  But Pierce proved unacceptable in the North because of his support for the Kansas-Nebraska Act.  Southerners then swung their support to Douglas, who was also widely unacceptable in the North for the same reason.  All sides ultimately agreed on James Buchanan, who had played no part in the controversy, and who went on to win the election.

The next crisis occurred almost immediately after Buchanan's inauguration, when the Supreme Court came out with the Dred Scott decision, holding (among other things) that Congress could not exclude slavery from the territories, making the Missouri Compromise unconstitutional.  The effect of the ruling was to hold the Republican Party unconstitutional and call for it to disband itself, although of course the decision did not say so in so many words.  Needless to say, Republicans were outraged at this overreach and showed no disposition whatever to disband, or to abandon their goals.  Dred Scott also posed a potential threat to popular sovereignty because it hinted that a territorial legislature, as a mere creation of the federal government, could not exclude slavery either.  This threatened to raise a major rift between northern and southern Democrats, but at the time they were able to paper over the distinction.  Douglas -- and many Southern Democrats as well -- argued that, although a territorial legislature could not ban slavery outright, it had no obligation to give any support to slavery and could therefore effectively exclude it.

The potential rift came to head in 1858, when the Missouri-controlled Kansas legislature applied for admission of Kansas as a slave state against the clear wishes of the population.  That was a bridge too far for Douglas.  He was willing to ignore slavery as a moral issue and treat it as simply another thing to be decided by majority vote, but imposing slavery on the people of Kansas against their will was going too far.  Besides, he was up for election later that year, and to admit Kansas as a slave state against the wishes of the population would have been political suicide.  Douglas led the fight in Congress to block the admission of Kansas as a slave state (ultimately successful) and thereby made himself as hated in the South as any Republican -- indeed, more, because he was seen as a traitor.

Congress' refusal to admit Kansas as a slave state was followed shortly by the famous Lincoln-Douglas debates.  Lincoln pressed Douglas during the debates on how a territory could exclude slavery if Dred Scott forbade such an action.  Douglas gave the answer he had been giving for some time -- that a territorial legislature could not ban slavery outright, but it could exclude it by "unfriendly legislation."  At about the same time, Jefferson Davis (then a Senator from Mississippi) was giving a speech to New England's dwindling band of Democrats, and assured them that Dred Scott did not mean forcing slavery on a territory against the wishes of the inhabitants since they could always exclude it by failing to pass a slave code.  When Douglas learned of this speech, he quickly seized upon it to prove that his opinion was no different from the opinion of the most prominent Southern militant.  Wanting to put as much distance as possible between themselves and the hated Douglas, Southern Democrats then began demanding that Congress pass a slave code for the territories -- a thing that was utterly unacceptable to northerners, Democratic or Republican, anti-slavery or indifferent, and which therefore stood no chance whatever of getting through Congress.**

During the 1860 Democratic Convention, the American public was treated to the sight of a major political party committing suicide by self-disembowlment.  Southern Democrats made clear that they would not accept Douglas as the nominee under any circumstances, and demanded that the party endorse a slave code for the territories.  This demand was utterly unacceptable to Northern Democrats, who rallied behind Douglas.  Vicious in-fighting followed, and the Southerners ended up walking out of the convention to nominate their own candidate.  The Northern remnant nominated Douglas.  The split sealed the Democrats' fate and guaranteed that Lincoln would win as the Republican candidate.  Southerners, unwilling to endure a Republican in the White House, seceded.

So what does this depressing story have to do with the Tea Party?  Quite simply, it shares the Tea Party's dynamic in several ways.  To take the most obvious similarity, the Democrats in the 1850's and the Republicans today were both examples of a party splitting.  In both cases, hard liners increasingly came to value combativeness for its own sake above an beyond achieving any sort of outcome.  And both came to value ideological purity above electoral success.  Of course, there are major differences as well.  Most obviously, secession and civil war are not in the cards this time.  Nor is the difference this time anything as simple as a sectional split.

But perhaps the most disturbing similarity, I believe, is that the underlying motive is one of fear and despair. Southerners in the 1850's were enjoying a period of unprecedented prosperity and political dominance, but they could read the handwriting on the wall.  Geography and demography were stacked against them.  They spent a futile decade trying to legislate these facts away.  Likewise, much attention has been paid to this survey and its emphasis on fear and despair as the Tea Party's great motives.  They, too, fear that their party is doomed and demographic is in hopeless decline.  I see despairing comments on blogs that there will never be another Republican President.  My response is to say that such fears are foolish of course there will be another Republican President.  He (or she) will just have to adapt to changing times.  But they Tea Party are people who do not want to adapt to changing times; they want times not to change and do not know how to achieve it.

And that is how the Tea Party is most like the secessionists -- they are both standing athwart history, shouting stop!

*Actually, 36 degrees, 30 minutes.
**Many accounts today, wanting to maximize Lincoln's role, claim that it was Douglas' answer during the debates that made him unacceptable to the South.  I highly recommend Don Fehrenbacher's The Dred Scott Case and Stephen Oates' The Approaching Fury (and no doubt many other detailed histories of the period).  By giving a detailed chronology of events, they make clear the it was Douglas opposition to the admission of Kansas as a slave state that made him unacceptable in the South, and that anything he said in the Lincoln-Douglas debates was simply an excuse to hate him more.

Saturday, October 26, 2013

Tea Party Today: Democrats in 1972?

Now that the shutdown and threat of default are over, I should be turning to Obamacare and its disastrous rollout and wondering if it is salvageable.  I do plan to get to that in the near future, but I would like to pause for a few thoughts on what is happening to the Republican Party.

A strong hint of it comes from the 2010 Senate election in Delaware, in which the Republicans threw away an easily winnable seat by nominating the certifiably crazy Christine O'Donnell over the moderate Mike Castle, of whom one observer said, "Mike Castle does not lose elections in Delaware."  The point is not simply that the Republicans threw away a winnable election by nominating a crazy candidate, but how their actions were perceived.  Because Castle had a distinguished political career in Delaware and was supported by most of the state's movers and shakers, O'Donnell's nomination was hailed as a victory for the grassroots over the Republican establishment.  Except, as a local observer noted, the Delaware Republican establishment is the grassroots.  The "establishment" includes "long-term GOP activists and loyal partisans who attend State conventions, show up to volunteer locally year after year, and know their state’s electorate and issues really well" and people "who knock on the doors and pass out the literature and pound the pavements.”  Much of O'Donnell's funding and manpower came from the Tea Party Express, based in California.

Something similar happened with Ted Cruz.  Though a Princeton and Harvard graduate with a longtime career in federal and state government and the backing of national conservative organizations, Cruz was able to portray himself as the outsider and insurgent against an "establishment" candidate because his opponent because his opponent got along with his fellow Texas politicians.

It reminds me of what I have heard about the Democrats in 1972.  I am personally too young to have first-hand understanding of the Democrats in 1972 and too old to study them as history, but this is my understanding.  Traditionally, the parties had chosen their Presidential candidates at nominating conventions. The nominating conventions were run by the party movers and shakers -- governors, mayors, party machine men, and political bosses.  Democratic activists scorned such people (justifiably) as corrupt and elitist and (less justifiably) as out of touch.  Proclaiming, "Power to the people!" they demanded an opening up of the nominating process, and they got it.  Except it turned out that most ordinary people had other things they wanted to do with their lives than nominating candidates, and that only hard core activists really wanted to put in the effort.  It further turned out that activists were considerably more hard-core in their ideology than ordinary people.  It further turned out that elected officials and party bosses, though often corrupt, got there by understanding their constituents and were often closer to ordinary voters than the activists.  "Power to the people" turned out simply to mean power to the activists and turn most people off.  The 1972 Democratic convention was such a freak show that it handed Richard Nixon -- easily our least charismatic and least personally likable President of all time -- a record landslide.  Democrats gradually changed their nominating rules to allow more establishment people and ensure that grownups were in charge.

So, is the same thing happening to Republicans now?  They do have the advantage of a larger and more entrenched activist base than the Democrats had in 1972.  And they seem solidly in power in the South, the Great Plains and (possibly) parts of the Mountain West.  But these regions are not the whole country.  They are not even the whole "flyover country."  And the Tea Party really does seem to be making the same mistake as activists on the left made back then -- mistaking themselves for the American people.

Wednesday, October 16, 2013

Post Script

I got a painful lesson today in how much counter cyclical is counter intuitive.  I had expressed my worries about the shutdown and debt ceiling to someone who never paid much attention to news and current events. Curious, he decided to look into it.  He came away just about ready to join the Tea Party, terrified of all the borrowing going on, and certain that we had to stop it, no matter what.  Sigh!

Doomsday Averted! (Or, I Truly Don't Understand Republicans)

Well, apparently we will not get to find out just how long after October 17 it would take for the US government to start missing payments.  Apparently Congress can act fast if it really wants to.  The Senate passed its bill at 7:56 p.m. and the House followed in short order.  Obama will sign either tonight or first thing tomorrow.  The vote was not even close, 81-18 in the Senate and 285-144 in the House, indicating at least 85 Republican votes in favor.

And given how calmly they seem to be accepting defeat, I can well and truly say that I don't understand Republicans at all. Ted Cruz made no attempt to block the bill.  John Boehner, after caving, got a standing ovation, and Republicans across the board vowed to stand by him.  Hard liners said that he did the best he could, and only succumbed to political reality when it became clear the moderates would not back him. What are we to make of that?  I don't know, but I can throw out a few speculations.

The whole thing was a show.  Republicans knew from the start that when a debt ceiling breach became a real danger, they would have to back down.  The whole shutdown and negotiations was just so much theater for the benefit of the base and/or the mainstream media.  This does not rule out future debt ceiling threats, but makes any future threats less credible.

We are in a short term post-crisis honeymoon.  After Obama won reelection in 2012, Republicans briefly made nice with him and promised to accept him as our legitimate President.  The phase did not last long.  Soon they simply doubled down on the crazy.  They may react to this defeat in the same way.  John Kenneth Galbraith, in his novel The Triumph says:
A political crisis has this in common with a sex orgy or a drunken bat.  Everyone enjoys it immensely, although they feel they shouldn't.  It so exhausts the participants that once it is over, an immediate repetition is unlikely.  But as time goes by and memory improves on past delights, the chances of a repeat grow.
(Taken from memory, may not be entirely accurate).  I have no idea whether this is true.  But every time there is a political crisis, I remember the quote and worry.

Republicans are attempting to mend a major fracture in their party.  The pro-Boehner love fest is part of the attempt.  We will see how it goes as time unfolds.

Republicans are putting on a facade of unity.  The knives will come out when people stop looking.  This one is actually closely related to the above.  The difference is that an attempt to repair the fracture may succeed; if this one is right, they have already given up.

They just had to do it once and get it out of their system.  If so, it is now well and truly out of their system and we can reasonably hope to avoid a repeat performance.

Republicans don't care about results, just taking maximalist stances.  This would tie in with their strong roots in Evangelical Christianity, which encourages members to focus on doing what is right (often defined as maximalism against evil) and leaving the results to God.  But then again, this does tend to come with the assumption that if you do right, God will reward you with good results.  And certainly many analyses of the Tea Party suggest that it grows largely out of frustration that Republicans have failed to bring about much in the way of results when the base elects them.  If so, then going home and telling the base, "Well, we did our best but it failed, let's move on," is unlikely to placate them.

The right wing of the Republicans are so out of touch that the somehow see this as a victory.  What can I say?

I guess over time we will know.

PS:  Obama has now signed the act into law.  I guess now we know how quickly it can be done.

Tuesday, October 15, 2013

Two Days (Maybe) and Counting

Following Congress has become really nerve racking.  The differences between the sides by now are so minimal that in a less highly charged atmosphere they could easily be resolved.  But ultimately, the Republicans are determined to get something in exchange for reopening the government and not defaulting and the Democrats are determined not to treat opening the government and raising the debt ceiling as any sort of concession requiring an quid pro quo.

The latest news is that the parties agree to keep the government open until January 15, extend the debt ceiling until February 7, and make some sort of minor change to Obamacare.  The only controversies are what minor change, and whether the Treasury may use "extraordinary measures" to extend the debt ceiling.
Senate attempt at mutual concessions on Obamacare has failed, and the House failed to extract slightly more, including a ban on extraordinary measures.  The Senate is expected to come out with a deal that allows extraordinary measure and makes only one change to Obamacare -- more income verification.

The question next question (assuming a deal is struck) is whether this will pass before the presumed doomsday.  The answer is almost certainly no.  Theoretically, one house could pass the bill tomorrow and one the next day and President Obama have it inscribed at emergency speed so he could sign it.  But no one expects that to happen.  That would require all Senators to give unanimous consent to passing the bill in one day, a measure that any one (cough, Cruz, cough) could block.  Apparently the best anyone can hope for is for Boehner to send a "message" to the Senate, which will prevent, ahem, anyone in the Senate from delaying the bill for more than 30 hours.  But even then, the Senate is expected to pass it no sooner than Saturday, and the House would have to act on Sunday.  Now, the best guess is that an actual default will not occur when the clock strikes midnight on October 18, but closer to October 22 (the following Tuesday).  The Tea Party crowd will no doubt claim vindication when raising the debt ceiling is delayed several days past doomsday and doom does not strike.  This will raise the likelihood of a future showdown and default.  Sigh!

Monday, October 14, 2013

Three Days (Maybe) and Counting

Okay, Congress.  This is it.  We're down the the wire now.  You need to come up with something, and you need to come up with it today.  Even if  you do come up with it today Ted Cruz will probably delay it until after the technical deadline and we will (theoretically) breach the debt ceiling.  In fact, doomsday has probably been postponed till the end of the month.  And I suspect that even if it hasn't, a short breach will be survivable, especially if the markets can see Congress working to end it.  The biggest danger may be to the credibility of the Treasury and others warning of doom, which will only make a future breach more likely.

So please, Congress.  This is it.  You've got to come up with something.

Sunday, October 13, 2013

Four Days (Maybe) and Counting, Plus, What if We Do Breach the Debt Ceiling

So, in the latest news, Democrats may or may not reject a plan to extend current spending levels until March and instead press for a shorter deadline in hopes of getting more funding.  I think this is nuts.  Republicans see a one-way ratchet on spending -- it can only go down.  They now see agreeing to the spending levels in their proposed budget as capitulation on their part.  I am inclined to agree that this shows that Democrats should not start out by conceding Republican spending levels -- let the debate be whose levels, not what ransom you must pay to get Republican levels.  But it is a bit late now.  The longer you lock in Republican spending levels, the longer you can postpone the next budget crisis.  Meanwhile Paul Ryan has once again resurrected plans for using the budget battle to kill Obamacare and therefore does not want to continue funding to next year because the subsidies will kick in by then.  Sigh!

With a significant likelihood that will be pass the supposed deadline for a debt ceiling breach, I would like to speculate on what would happen.  First, there is, indeed, evidence that the shutdown has postponed the day of reckoning, quite probably to the end of the month.  I should register here my agreement with Kevin Drum. If shutdown has postponed the day of reckoning or the Treasury can prioritize payments, then statements to the contrary will seem like fear mongering and convince Republicans to be more willing to take crazy risks.

But, what would happen?  Well, so far markets seem worried about a short-term breach, but confident that it will not last beyond a few days.  I am inclined to think that will be survivable.  Republicans are arguing that so long as the government pays its bondholders, there is no actual default, and it does not matter who else gets stiffed.  At least according to this article, it would probably be possible to assure that bond holders got paid and did not disrupt the financial system -- but only at the cost of stopping payment on everything else. If this does happen, count on Republicans, who urged prioritizing bondholders and not worrying about anyone else, to scream bloody murder and accuse Obama of making things needlessly painful.  But here is the thing. Republicans will not be the only ones screaming bloody murder.  So will everyone who misses a Social Security payment or other check from Uncle Sam.  And there is no doubt to my mind that this will lead to an increase in the debt ceiling, fast.  Maybe if the breach is short enough, the damage will be limited.

So far as I can tell, "moderate" Republicans have chosen to use the debt ceiling rather than shutdown as their hostage of choice because it scares the hell out of insiders, but polls well with the general public.  Shutting down government polls badly and was unpopular last time the Republicans tried it, so the leadership wants to avoid it.  But raising the debt ceiling is unpopular.  And voters generally express support of the idea that increases in the debt ceiling should be matched by cuts in spending.  Voters are not polled on whether refusal to raise the debt ceiling is worth it if that means their Social Security checks start bouncing.  I am guessing that the answer would be no.

Furthermore, if refusal to raise the debt ceiling leads to bouncing Social Security checks, then Republicans will no longer have the support of public opinion if they try it again.  Obama will only have to point out what happened last time, and public opinion will turn against the idea in a big hurry.  In other words, breaching the debt ceiling is a credible threat only as long as it remains a threat.  Once it actually happens, it will be too unpopular ever to try again.

Saturday, October 12, 2013

Long Term (2014) Political Reprecussions

So how will the shutdown/debt ceiling confrontation affect the Republicans in the long run, meaning in the 2014 elections?  Put me with the people who believe that this showdown by itself will be long forgotten by the 2014 elections.  What will matter is if the Republicans repeat the same stunt three or four times.  That will do them in.

On the one hand, I think that as next year progresses, some things will relieve the pressure to be as crazy as possible.  People will actually start getting insurance under Obamacare, so Republicans will no longer be seeking to block implementation, but to take people's insurance away.  I can't see that going well for them. Right now they are kept in line by the threat of a primary challenge.  But the primaries will happen, and one by one Republicans will no longer fear such a challenge.  Some will win and be safe.  Some will lose and be lame ducks, angry and resentful that their best crazy act wasn't enough.  Some will prevail and actually fear a challenge by a Democrat.  And as the election looms closer and closer, Republicans will have more and more to fear from a shutdown/breach.  On the other hand, if things look bad enough, Republicans may decide that they are doomed anyhow, so they might as well do as much damage as possible before they go.

Furthermore, if Republicans go on their best behavior before the election, it will only raise the risk of another showdown after the election.  If they win, there will be two more years of this.  If they lose, they will see their power ending in two months and be determined to cause as much damage as possible in that time.

Let me say beyond any question, if the Democrats win back the House and hold the Senate in 2014, their first act absolutely MUST be to abolish the debt ceiling.  (Abolish the filibuster if necessary to get it through).
The Republicans must be defeated.
This is the most disheartening analysis of the deb ceiling standoff yet.  It makes very clear that neither side is willing to back down because both see their ultimate power as being at stake.  Obama says he will not make concessions because it would encourage the Republican House to use the threat to blow up the economy to extract unilateral concessions.  To Republicans (Tea Party and moderate, Senate and House), to give up the debt ceiling is to give up their ability to get anything passed while controlling only one house.  
That has only reaffirmed to House Republican leaders -- who wanted to avoid a government shutdown -- that they have no choice but to stand their ground on the debt ceiling. Surrounded by a hostile White House and Senate, and with few legislative avenues beyond borrowing and spending bills to impose their agenda, Republicans said capitulating to Obama would cede to Democrats the only institutional authority Republicans possess.
. . . . . . . .
Congressional Republicans were divided over whether to allow the government to shut down. Most opposed the strategy of attempting to defund Obamacare by attaching it to a budget bill needed to keep the government open beyond Sept. 30.
But the GOP is virtually united on the debt ceiling.
Philosophically, they view it as an opportunity to enact the fiscal reforms and spending cuts they believe are necessary to balance the nation's books and foster economic growth. Many believe this is what they were elected to do. Politically, it speaks to House Republicans' desire to reclaim legislative branch authority from the executive branch -- an issue that drives many Tea Party-affiliated lawmakers.
Unlike negotiations over gun control or immigration reform, in which Republicans can influence policy simply by refusing to consider legislation, raising the debt ceiling -- which must happen -- requires Republicans to support it.
. . . . . . . .
“A large part of what the House GOP has been trying to do since the 2010 election is to reassert the power of the legislative branch, not simply imposing their will as a GOP majority,” a former House GOP leadership aide said.
All right.  Let us set aside accusations of hypocrisy, given that Republicans, the most right-wing included, supported virtually unlimited executive power when George Bush was President.  That was almost unlimited power over foreign policy and national security.  They did not dispute legislative supremacy in domestic policy.  As a matter of fact, right-wingers oppose domestic policy as a matter of principle and will happily endorse anything that impedes it.

What Republicans seem to be missing is that our system has a lot of veto points.  For any legislation to pass, it must gain a majority in the House and Senate and be signed by the President.  Or -- example of legislative supremacy here -- if the President is of one party and both houses have a two-thirds majority by the other party, they can override his veto.  And -- in a further display of legislative supremacy -- if Congress passes a program and appropriates money for it, the President may not simply decline to carry out the program and spend the money.  But legislative supremacy has its limits.  Congress can force the President to carry out a program he does not like, but it cannot force him to do a good job.

This means, as the article acknowledges, that controlling only one house of Congress, Republicans can block any legislation they don't like, such as immigration reform or gun control.  Democrats may grumble (they do), but ultimately this is simply politics as usual.  Asserting legislative supremacy here would mean stopping the President from attempting gun control by administrative means, or form failing to enforce immigration rules.

But ultimately, in terms of passing legislation, the only way to assert legislative supremacy is to override the President's veto.  Republicans have a slender majority in the House, well short of the 2/3 needed, and a minority in the Senate.  The accepted way for a party that controls only the House of Congress to get legislation it wants passed is to pass it, and then negotiate with the Senate and President for some sort of compromise.  Give the other party part of what it wants in exchange for them giving you part of what you want.  This is normal democratic politics.  What Tea Party Republicans say when they say they are trying to reassert legislative supremacy, rather than impose an agenda, is that they have never controlled more than one branch of the legislature.  So they are not merely trying to assert legislative supremacy over the executive, but the supremacy of one branch of the legislature over the other, and, indeed, over the other branch in combination with the executive.

Republicans don't want to raise the debt ceiling.  At the same time they (or at least most of them) acknowledge that it "must happen."  Failure to do so would be catastrophic.  So it is hard to see agreeing not to do something unpleasant but necessary to avoid catastrophe is a significant concession, as opposed to an unpleasant duty of the office.  And it is hard to see how refusal to do what everyone agrees is necessary to avoid catastrophe is simply a normal assertion of legislative supremacy, as opposed to hostage taking.

Assuming we avoid default this time, look for more hostage crises down the line.  The Republicans must be defeated.


PS:  What is this about the Senate originating a continuing resolution anyhow?  I thought the House had the sole authority to originate money bills.  Does this mean any Senate compromise will be presented to the House with an ultimatum of "pass this or face the people's wrath when we default" and then go to the Senate?  Or what?

And just how face can an Act of Congress be inscribed and sent to the President for signature?

Five Days (Maybe) and Counting

Well, I missed yesterday, but here we are five days from a (possible) debt ceiling breach and, although proposals are being made, none have been accepted.  Obama has rejected a six-week extension in the debt ceiling and "moving quickly" to reopen the government in exchange for deeper spending cuts.  Good!  That would simply prolong the hostage crisis for six more weeks.  Senate Republicans (and a few Democrats) have blocked a one-year clean debt ceiling increase.  Senate Democrats have rejected a plan by Susan Collins to extend the debt ceiling until January, keep the government open till March, give agencies more flexibility in how to manage spending, and repeal the medical devices tax from Obamacare.  Reasons given for rejecting the plan include that it sets funding too low, changes Obamacare, and the debt ceiling extension is too short.  The article does not say whether the new deal permits or forbids "extraordinary measures" to keep from defaulting on our debt.

Speaking for me, I would say that whether this plan is worth accepting would depend on whether it allows extraordinary measures to avoid default.  Trying to avoid locking in lower spending is a waste of time.  Ain't gonna happen.  Republicans are convinced that current levels of spending are intolerable and must be massively cut (even if they don't know how or where to cut them).  They are not going to agree to spend any more.  Period.  Nor do I see accepting a repeal of the medical devices tax as all that big a concession, certainly not a hill worth dying on.  Obamacare in substance will survive.  That is no longer under dispute.  Tiny tinkering around the edges will allow Republicans to save face without serious damage to the program.  I do not see it as a big deal.  Keeping government open until March works fine with me.  Democrats should be seeking as long an extension as possible, even at current funding levels, to avoid shutdowns as long as possible.

The debt ceiling is the big thing.  I notice that no Republican proposal so far extends the debt ceiling longer than it reopens the government.  The only possible exception is the six-week extension of the debt ceiling, which kicked the can down the road.  Having the debt ceiling breach after the government shut down has gone against the Republicans' interests. It means that people tend to conflate the two, and to want the government to reopen, and not to pay much attention to extending the debt ceiling.  Republicans would rather have a crisis in which ordinary people feel no discomfort, thus lowering the pressure on them, but catastrophe looms, thus raising pressure on Democrats.  Democrats, of course, if they cannot stave off a crisis altogether, would rather shutdown come first and debt ceiling after.  That is why extraordinary measure matter.  If the debt ceiling falls due at the end of January, but the Treasury can use extraordinary measures, it should (based on past performance) be able to extend it until at least May or June.  That will, once again, tend to conflate the debt ceiling with any shutdown that may occur in March, and to give time for pressure to extend to build.  It will also take place late enough in the season that the Republicans will be looking over their shoulders and not wanting to inflict too much damage on the country for fear of losing the next election.

Of course, if that means that Republicans hold onto the House, then we will simply be in the same position for the next two years.

Thursday, October 10, 2013

One Week (maybe) and Counting

I cannot say I am very pleased with the latest proposal to come out of the House.  They would extend the debt ceiling until November 22, while banning "extraordinary measures" by the Treasury Department to keep things going beyond that date.  The government would stay closed while the sides negotiate a budget.  And President Obama has said he will "likely sign" such a measure.  Republicans have apparently figured out that the shutdown and the debt ceiling are becoming identified in the public mind (something I was counting on) and want to separate them.

So, Republicans will grant their more valuable hostage a reprieve until November 22 and then definitely shoot it, and they will hold onto their less valuable but more visible hostage.  In the meantime, budget negotiations will take place.  Republicans have already let it be known that any budget based on the numbers they have supported all these months would be an intolerable capitulation, and only massive cuts will persuade them to reopen the government and again extend the debt ceiling.  Oh, yes, and the Tea Party faction will settle for nothing less than ending borrowing altogether, i.e., an immediate balanced budget.

Okay, trying to salvage anything even minimally encouraging from all this, it probably means that the Republican leadership is aware of how dangerous a debt ceiling breach will be and is not willing to risk it.  If they will grant the hostage this one reprieve, they will probably find a way to grant another.  Or maybe the Crazy Caucus will find the humiliation so painful that only an actual breach will remedy it.

The real, underlying problem here is that the Tea Party caucus wants something that is not achievable.  Many of them will settle for nothing less than an immediate balanced budget.  Given that about a third of budget* is covered by lending, and given that Republicans are united in their belief that taxes are intolerably high and must never be raised no matter what., that means cutting federal spending by about a third, immediately.  Tea Partiers have convinced themselves either that these cuts will be painless or (more probably) that any pain resulting from such cuts will be much less than the looming crash that will strike if we continue to borrow.   They consider a debt ceiling breach a perfectly reasonable way to stop the borrowing once and for all.

Of course, there is another, perfectly normal and acceptable way within our system of government to stop the lending.  That is to submit an actual balanced budget.  That will do it; the lending will stop.  But, of course, the Republicans, even the Tea Party, don't actually know how to do that.  Any budget that cut federal spending by a third (or even 20%) overnight would be politically unpalatable.  It would be greeted by outrage among the general public, and even much of the Republican base.  It would not pass the Senate.  It would not be signed by the President.  It probably would not pass the House. Hell, I don't even know if would be acceptable to much of the Tea Party.  Any serious attempt to balance the budget is going to take time, patience, and planning.  As Megan McArdle says, you can privatize air traffic control, but you cannot privatize them by the end of the month.  You can convert Social Security into a system of private accounts, but you cannot retroactively have made everyone save the requisite amount.  And even if the Tea Party believes that borrowing is so dangerous that there simply is not enough time for an orderly reduction in spending, it certainly is not so urgent that it cannot wait a few months for the House to come up with a balanced budget.

I can only take the Tea Party's enthusiasm for a debt ceiling breach as an implied acknowledgement that they don't know how to balance the budget overnight and are punting it to the executive.  Yes, that's right, after denouncing Obama as an out-of-control executive and an elective dictator, they now want him to decide which spending gets cut so they don't have to.  A more honest strategy is the one that others seem to like -- shutting down the discretionary portions of the government and then deciding which parts they like so they can reopen them.  But all in all, it reminds me of an old joke about the female college student who approached her professor about a looming term paper.  "Please," she said, "I'll do anything for an 'A' on my paper."  "Anything?"  "Yes, anything."  "Good, then.  Write an 'A' paper."  The Tea Party will do anything for a balanced budget.  Anything?  Yes, anything.  Good, then.  Write a balanced budget.  Anything but that!

*Actually, I have heard figures as low as 20%, but even that would be intolerably painful to cut overnight.

Eight Days (Maybe) and Counting

Okay, now we have eight days to the debt ceiling breach (or maybe more).  I see nothing encouraging out there.  The only supposedly good news is that Obama has said he will agree to a short-term increase in the debt ceiling, followed by negotiations.  Great!  So we get a few weeks respite (a month or two if we are lucky) and the whole thing starts all over.  If Democrats were so foolish as to think there would be any relaxation of the sequester, they are being proven wrong.  Republicans current position is that sequester-level spending is intolerably high and the only negotiation they will allow is on how much further to cut.  And that is the good news!

This is what really scares me.  Republicans, or at least a significant faction thereof, say they don't care what political harm they take or what harm it inflicts on the world economy.  Breaching the debt limit will be well worth doing if it ends deficit spending and heads off an even greater crisis that is presumed to loom ahead.  If they do raise the debt ceiling it will only be in exchange for -- well, it is not clear what, but truly massive spending cuts.  Now, granted, I think their resolve may be weaker than they think.  We do not, in fact, know when the breach will take place, but when it does, bills will start going unpaid, and the people who do not get paid will start to howl.  I think this will have the effect of getting the debt ceiling raised in a big hurry, and (probably) discouraging Republicans from threatening any more defaults for at least the time being.  But the harm to the country could be considerable.

So, the choices appear to be traumatic debt ceiling breach that temporarily scares some sense into Republicans, or short-term extension with this drama playing out over and over every few months.  Pick your poison.

Tuesday, October 8, 2013

Nine Days and Counting (?)

Well, now I have seen an estimate of how the government shutdown affects the debt ceiling.  Goldman-Sachs estimated on September 29 that a few days' shutdown would not make any material difference and "even" a week would not extend the deadline long -- perhaps until October 31.  On October 31, many bills (Social Security, for instance) come due and would almost certainly lead to a breach.  Apparently Goldman-Sachs did not take into account a shutdown lasting more than a week.  Wonkblog says that even if we reached that point, the Treasury Department could probably prioritize bond holder, but only at the cost of shutting down everything else.

First of all, let me second what Kevin Drum says.  If an extended shutdown extends the default date, it would be a mistake for the Treasury to insist that the world will end on October 17 and then, when October 17 rolls around, say we have a reprieve.  That will just encourage the belief that a debt ceiling breach is not that big a deal.  I also do not recommend talking about the most dire and catastrophic possible events if a breach roils the financial system.  Such things will seem remote and unreal to most people.  It is better to emphasize the more concrete and tangible results of a breach, as I so like quoting from Megan McArdle.  Explain the whole slew of bills you have coming due October 31.  Be concrete and specific and focus on popular stuff like Social Security payments, or payments due to contractors.  Explain that up till now, a lot of the government has been on autopilot, and has kept flying because the pilot has been reporting for duty without pay.  Point out the obvious -- that government workers will stay on the job a few weeks without pay, but not forever.  And explain that what we are facing now is something different -- the autopilot will be running out of fuel.  Unless Congress releases the funds we will only be able to cover two-thirds of our bills. That means that all those bills coming due October 31 -- and again remind people what those bills are -- will either be late or short by a third, or a third of them will go unpaid.  That, I think, will scare ordinary people a whole lot more than the prospect of a financial crisis, and will much more effectively ramp up the pressure to do something.

I think someone also ought to point out that Republicans, by threatening to force an overnight spending cut by 1/3, are shirking their own long and hard duty of actually coming up with spending cuts.  Once again, McArdle points out why good, well-controlled spending cuts take a lot of time and effort.  Speaking to the debt ceiling crisis in the summer of 2011, she said:
It would, for example, be eminently possible to have a private air-traffic control system. But we cannot privatize the system by August 3rd. Similarly, I think we could use a Singapore or Chilean style private accounts system to save for retirement, but we cannot arrange for today's Baby Boomers to have started saving in 1972--at least not without some fairly massive government spending on time-travel research.
I also think someone ought to point out what Republicans are saying when they argue that we don't have to worry about a default because there is plenty of money to pay bondholders.  Has anyone pointed out if we prioritize bond holders, who else will get stiffed?  Republicans may be okay with this, but I think most Americans will not.  Furthermore, I also believe that if the Obama Administration actually does prioritize bond holders in a debt ceiling breach, Republicans will be the first to freak out and accuse him of privileging Wall Street over Main Street, despite having spent the last several weeks urging him to do just that.

The most discouraging thing, though, is that this is starting to look as though it has gone well beyond a policy dispute.  It is now politicians' egos on the line.  God help us all!

Monday, October 7, 2013

Just to Show You Can Still Find Humor

And just to show you can still find humor in the current madness, I present the following:

Ten Days and Counting

Ten days to go before we breach the debt ceiling, and not has changed.  Well, one thing has changed.  My mood is becoming more anxious and wondering what if this really does not resolve.  It is starting to distract me from work.  But then again, I don't expect much of anything to happen this week, besides preening and posturing, so I really shouldn't be getting to anxious yet.  If Republicans are going to cave, it should happen about the beginning of next week, with a default breathing down their neck.  So, optimistic scenario is preening and posturing till about Friday, secret, frantic negotiations over the weekend for a token, symbolic concession by Democrats that will give nothing of substance but allow Republicans to save a modicum of face.  Then, almost clean combined CR and debt ceiling passes at the beginning of the week, Ted Cruz delays it as long as he can, and it narrowly passes the Senate to maximum speed signing.  Of course, a lot of things could go wrong.  Neither party might budge.  Ted Cruz might delay things long enough to force a breach.  The bill could take too long to inscribe and delay signing.  Anything.  But basically, I will fight to urge to panic this week.  If nothing is passed by Monday, it is time to give in to it.

In bad news, Senate Republicans are refusing to pass a bill unanimously passed by the House to give back pay to furloughed federal workers.  In further bad news, one of the most moderate House Republicans is backing off his support for a clean continuing resolution.  In what could be good news over the long run, but is too late to be much use now, the Chamber of Commerce is pledging to donate funds to defend sane Republicans against primary challenges.  They may even mount primary challenges against the truly insane. Although I am not overjoyed at the thought of the Republican Party as wholly owned subsidiary of the Chamber of Commerce, I prefer it to a Republican Party that has completely lost its mind.  Unfortunately, it looks to be a day late and a dollar short.

In short, hold tight.  This will be a rough week.

Saturday, October 5, 2013

What Democrats are up to

Okay, I think I now understand why Democrats are wanting a continuing resolution to fund the government at current levels to last a shorter, rather than longer, time.  Democrats are unhappy with current levels of funding and hope to negotiate an increase with Republicans.

Bwah ha ha ha ha!  Or, as we say on the internet, ROTFLMAO!  If the Democrats think that, they are nuts! Let me explain some basics.  Republicans think current levels of spending are intolerable and must be massively cut.  It logically follows that they will not agree to an increase.  Besides, each defeat simply makes Republicans even crazier.  Assuming they eventually cave on this go-round, the Tea Party wing will simply decide that they were not crazy enough, and the moderates will fall in line, fearing a primary challenge.

On the other hand, Republicans have said that they might consider increasing discretionary spending in exchange for cuts in mandatory spending or, as it is euphemistically called, entitlement reform.  I am not clear whether Republicans simply mean cutting safety net programs for the poor, or whether they mean Social Security and Medicare.  (I guess we will find out).  If they mean cutting safety net spending on the poor, Democrats will refuse and public opinion may very well back the Republicans.  Democrats would be out of their minds to want to go there.

If the Republicans mean Social Security and Medicare, on the other hand, Democrats might want to go there, for entirely cynical and selfish reasons.  We do, in fact, have a serious long-run problem with both problems.  As our population ages, relatively more and more people will be using these programs, and funding will increasingly be a problem.  It is, indeed, better to deal with them sooner rather than later.  Republican want to deal with them through spending cuts only.  Democrats want to deal with them primarily with tax increases, though perhaps with some modest and cautious spending cuts.  In a sane body politic, the parties could reach some sort of compromise, then hold hands and jump together.  Unfortunately, we do not live in a sane body politic.  Republicans demand that any changes be made by spending cuts only and will not tolerate any increase in tax revenue again, ever.  Sure it's crazy, but so is the Republican Party.  Every attempt to negotiate the issue has gone exactly nowhere for this reason.  Any future attempt to negotiate entitlement reform in the ordinary political process will fail for the same reason.  That is why Republicans use extreme tactics like government shutdown and threat of debt ceiling breach to get their way.

Republicans have one little problem here.  Their basic position is extremely unpopular, not just with the Democrats, but with the public at large, including much of the Republican base.  They are right that eventually something will have to be done.  They are also right that ultimately, it will have to be something both parties agree to so that the voters will not be able to punish either party by voting for the other.  But so long as they refuse to make any concessions to the Democrats, it ain't gonna happen.  Which means that Democrats can portray themselves as champions of Medicare and Social Security against Republican attack.  And, although conventional wisdom has it that it is just about impossible for Democrats to win the House in 2014, if anything could make that possible, it is Republicans openly coming out as a threat to Social Security and/or Medicare.

To the extent Democrats are trying to smoke out Republicans as threats to those two programs, their position makes at least some sense.  But I still think we do best to postpone the next budget showdown and possible shutdown for as long as possible.

Two Mildly Encouraging Developments

Well, I see two mildly encouraging reports from the shutdown/debt ceiling standoff.  First, the House has unanimously passed  a bill ensuring the furloughed government workers will get back pay whenever the government reopens.  This means that even the House Republicans have rejected the extreme option of reopening the government in bits and pieces to see how much of it we really need.

More importantly, though, I really hope that this report is true.  It says, in effect, that Republicans know they have lost and that they are simply trying to prolong the shutdown until they have enough cover to add a debt ceiling increase to the bill that reopens the government.  Or, as the article says:
If the speaker were to move on a stopgap spending bill now, without conservative policy priorities attached, it would most likely pass with Republican and Democratic votes. But the ensuing Republican uproar — on and off Capitol Hill — would ensure that there would be no Republican votes to raise the debt ceiling. “It’s common-sense strategy,” one Republican strategist said. “If you’re going to take a bullet, you want to take just one.”
I have thought all along that this is how it would have to play out.  Apparently (for reasons I do not understand) I am wrong that the shutdown takes pressure off the debt ceiling, so my economic analysis is faulty.  But I stand by my political analysis.  The longer the shutdown persists, the greater the pressure to end it, and the more it will be conflated with the debt ceiling in the public eye.  As both political and economic pressure grow, eventually Republicans will have to cave.  It it grows strong enough, Boehner will be able to sneak a debt ceiling increase by relatively unnoticed in a vote to reopen government.  Granted, prolonging the shutdown will be painful, but nowhere near as bad as a debt ceiling breach, so it is a price we will simply have to pay.

The story adds that Boehner does not fear losing his Speakership -- who else would want such a thankless job -- but does fear that passing a continuing resolution too soon would ruin his chances of getting by a debt ceiling increase.

So, if this story is correct, the advice to Congressional Democrats is hold firm and make no concessions until the Republicans are finally ready to crack on the debt ceiling as well.  Then be willing to give some small, symbolic concession to allow Republicans to save face.  The advice to Obama is to get the &^%$$#@! exchanges working so people can actually buy insurance and make the healthcare law irreversible.

My greatest fear is that letting news of this Republican strategy get out will be enough to scuttle it.