December 4-6, 2010
Dec 04 14:43 Paying For Unemployment Insurance Extension Isn't That Difficult Dec 04 21:23 Job Creation Perspective vs. WH Spin Dec 05 05:36 Chip Cravaack, Public Servant Dec 05 13:04 Sen. Schumer: Master of the Forked Tongue? Dec 06 17:34 The DFL's Big Tent? Dec 06 06:08 Taking Issue With Paul Thissen Dec 06 15:14 Paul Thissen, Part II
Prior Months: Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
Prior Years: 2006 2007 2008 2009
Paying For Unemployment Insurance Extension Isn't That Difficult
Thursday, Democrats in DC and here in the Minnesota Twittersphere launched a full-scale attack on House and Senate Republicans for wanting to pass "tax cuts for the wealthy" while letting unemployment run out on the downtrodden and destitute. Left unsaid was that Republicans would've voted to extend the benefits if they were paid for.
After hearing the tumult and heartache from the progressive twittersphere, I decided to see how difficult it'd be to cut $56,000,000,000 to offset the unemployment insurance extension for a year. Thanks to the great research by the Heritage Foundation's Brian Reidl , I now have the answer. Here's a glimpse at what could be cut:
Table 1: Spending Cuts for FY 2012
(in millions of dollars)
Agriculture
$15,000 Replace farm subsidies with Farmer Savings Accounts and improved crop insurance.
$2,033 Eliminate the Foreign Agriculture Service.
$1,500 Merge all four agriculture outreach and research agencies and cut their budget in half.
$1,000 Fund the Food Safety and Inspection Service with user fees.
Education
$8,000 Return Pell Grants to their 2009 funding level of $24 billion, which is still double the 2007 level.
$2,000 Trim Head Start by $2 billion and convert it into vouchers.
$2,000 Scale back the Education Department bureaucracy.
$1,500 Eliminate dozens of small and duplicative education grants.
$298 Eliminate state grants for Safe and Drug-Free Schools and Communities.
Those cuts add up to almost $36,000,000,000, nearly enough to pay for a year's extension. Just so we're clear, I'm not advocating that long of an extension. I'm just showing that it isn't that difficult to find the offsets. In fact, I'd bet that just showing the markets that we're serious about cutting spending and that we're implementing pro-growth economic policies would do alot to get the economy creating jobs again.
The only reason why this is an issue is because President Obama's economic policies have been utter failures. They've shrunk the economy, raised the unemployment rate while exploding the deficit. Had he not tried stubbornly stuck with failed policies, had he adjusted, things would've improved.
The figures cited earlier are significant, to say the least, but they aren't the proverbial mother lode. Check these numbers out:
Government Reform
$44,000 Halve federal program payment errors by 2012, especially by reducing Medicare errors and earned income tax credit errors.
Tighten oversight by spending $5 billion on new resources, such as updated computer systems, and then recover $49 billion in payment errors.
$20,000 Rescind unobligated balances after 36 months.
$12,500 Halve the $25 billion spent to maintain vacant federal properties.
$10,000 Cut the federal employee travel budget to $4 billion (half of FY 2000 spending).
These government reforms add up to $86,500,000,000. Theoretically, that's enough to pay for over a year of unemployment extensions.
The point to this is that the Democrats could've passed the unemployment extension simply by trimming some of this spending, none of which is important spending.
Democrats were booted from their House majorities because they spent like maniac, then refused to change their reckless ways. With Paul Ryan chairing the House Budget Committee, the days of reckless spending are quickly coming to a halt.
I can't wait for that day.
Posted Saturday, December 4, 2010 5:51 PM
Comment 1 by walter hanson at 04-Dec-10 06:16 PM
Gary:
Lets not forget unspent stimulus funds since Nancy has said for every dollar we spend create two dollars of stimulus!
Walter Hanson
Minneapolis, MN
Comment 2 by WhiteRose at 05-Dec-10 01:16 AM
Good Lord!! You are correct, they (congress) could have cut back in other areas to help Americans survive this 2nd dip, but they wouldn't do it.
Where's the outrage any more? Need to read a new book out where Americans actually take a stand against our corrupt D.C. (District of Corruption). I don't have much to spend this holiday but I'll be getting this thriller out cause it's so good & about what's really happening in D.C.
www.booksbyoliver.com
Glad to see someone did the figuring on how to offset the unemployment payments for a longer period. Wish it could get out to the general public. Good article! Thanks!
Job Creation Perspective vs. WH Spin
This post by Austan Goolsbee on the White House blog is factually accurate but it's devoid of context or perspective. Here's the factually accurate part:
Today's employment report shows that private sector payrolls increased by 50,000 in November, lower than expectations, but continuing eleven consecutive months of private sector job growth. The pace was not enough to prevent the unemployment rate from climbing to 9.8 percent.
While the overall trend of economic data over the past two months has been encouraging, today's numbers underscore the importance of extending expiring tax cuts for the middle class and unemployment insurance for those Americans who have lost their jobs. Failure to do this would jeopardize hundreds of thousands of additional jobs, and leave millions of Americans, who are out of work through no fault of their own, on their own.
In addition to the increase in November, the estimates of private sector job growth for September (now 112,000) and October (now 160,000) were revised up. Since last December, the economy has added 1.2 million private sector jobs. So far this quarter, including today's revisions, private sector employers have added an average of 105,000 jobs per month.
What Mr. Goolsbee hasn't and won't admit is that it takes 150,000 new jobs a month just to keep up with population growth. While I'm thankful that the economy is creating jobs, the reality is that President Obama's policies are failing miserably.
Ed's post about whether Keynsianism is dead sheds important light on what's wrong with Obamanomics:
It's worth noting that John Maynard Keynes gets a little bit of a bad rap in this debate. Keynes never argued that debt didn't matter, which is the argument at the heart of what we're calling Keynesianism. Keynes argued for spikes in government spending during recessions, but funding those through the collection of surpluses during boom years. Instead of spending out of accumulated but moribund American wealth, we're spending Chinese wealth, with interest. That isn't what Keynes had in mind.
I'm also reminded of what professed Communists said at the end of the Soviet era. Communists claimed that the Communist bloc collapsed in 1989-1990 because they just didn't do Communism well enough, or purely enough. We're hearing much the same argument from modern-day Keynesians, who claim that Obama didn't spend enough borrowed money, even though there were few voices in early 2009 advocating for spending on a multi-trillion dollar scale. The failure was one of courage, not Keynesianism, and all we need to do is borrow perhaps as much as a full year's federal budget in addition to the normal spending, and have government spend that, too.
The argument I'd make, which agrees with Ed's observations, is that the economy won't sustain itself if it isn't creating something. Injecting money into the economy will give a brief boost to the GDP numbers but, as we've seen the past year, it won't appreciably boost consumer confidence or capital investment.
I'd also argue that job creation numbers won't increase until we repeal Obamacare and we extend all of the Bush tax rates, including on the death tax, capital gains and dividends.
I'm reminded of something that Thad McCotter said about cost certainty during this interview :
Chairman McCotter said that it's important that we bring certainty to the labor costs but that we also make labor costs affordable enough so that businesses have an incentive to start hiring and growing their companies again. According to Chairman McCotter, that isn't possible without controlling spending and reducing government's intrusion into our lives.
A major reason behind the anemic job creation numbers is that, in addition to the cost uncertainty facing small businesses, is that what is known about labor costs, is alarming. If the Obama administration doesn't do something to cut labor costs, this anemic job growth won't improve.
In fact, I'll argue that if the Obama administration doesn't significantly change their economic theory, they won't be returned for a second term. At this point, President Obama faces a tough fight for re-election, especially if the GOP nominates the right candidate.
The Obama administration hasn't shown that they're competent in terms of bulding a great economy. That started showing itself when Tim Geithner didn't put a detailed TARP II presentation to Wall Street :
Financial stocks led the market lower, reflecting Wall Street's growing concerns about the government's ability to restore the health of the banking industry. Traders and investors said the lack of specifics from Treasury Secretary Timothy Geithner on how the government would direct more than $1 trillion in public and private support was troubling.
Another 2 years of Obama administration ineptitude would sink this administration. PERIOD.
Posted Saturday, December 4, 2010 9:23 PM
Comment 1 by walter hanson at 05-Dec-10 02:35 PM
Gary:
I think the best way to put this is that unemployment is at 9.8% despite the policies of the Obama adminstration. They haven't done anything that is progrowth. Just ask the people on the gulf coast who have lost jobs because Obama cares more about the environment than jobs.
Walter Hanson
Minneapolis, MN
Chip Cravaack, Public Servant
For 18 terms, Jim Oberstar brought home tons of transportation bacon to Minnesota's Eighth District. Unfortunately, during the las 3-4 terms in office, he didn't help put in place policies that'd let MN-8's businesses grow and prosper. According to this KARE-11 article , they're about to get a congressman whose highest priority is to get the Eighth's businesses humming:
Newly elected Congressman Chip Cravaack has been spending some time on Capitol Hill, but his focus is on the harsh reality of the recession at home in Minnesota's 8th Congressional District.
"You travel the 8th district there's a lot of closed shops," Cravaack said.
The freshman lawmaker said the key to re-opening those shops and bringing back jobs is to support small businesses. One way government can do that is to extend the Bush-tax cuts, Cravaack said.
"If you talk to any business owner that I've spoken with the last thing we need to do is increase taxes in the recessionary period. That to me would be disastrous,"he said.
Cravaack is also throwing his support behind local projects like the Polymet Mine in Hoyt Lakes. The copper-nickel mine is expected to bring in hundreds of jobs but has had a tough time getting started. Cravaack said he hopes to have the mine up and running by the end of his first term.
"One of the main things that I can do is to facilitate federal regulations and state regulations to look at what do we need to do here to get this project going. This is good for Minnesota. It's not just good for the 8th district but its good for Minnesota," he said.
In late August, Oberstar pretended to care about opening Polymet :
It's been in the works for more than four years , but when the environmental review came out last fall, the federal government blasted the report as inadequate.
Oberstar says he wants a thorough review, but it shouldn't take so long.
"The red tape, the slowdown, the lack of full attention by federal and state permitting agencies has dragged this process out much too long," said Oberstar.
Oberstar said the No. 1 issue people talk about in northeastern Minnesota is jobs. And the Polymet mine promises 400 jobs.
"I've heard some concerns, 'Be careful about our environment. We love this land, we don't want our waters to be adversely affected.' And I've assured people that corners will not be cut, there will be no exceptions made, but we have to do this in an expeditious manner," he said.
My first question is why it took 4 years of wasting time and millions of dollars of Polymet expenses to get Oberstar's attention. With a weakening economy, this should've caught Oberstar's attention 2-3 years prior to this.
Simply put, this was an election year ploy, nothing more. Oberstar was in perfect position to cut through the red tape years before this election. I knew in August what DFL pundits are only now admitting: that Chip Cravaack had made significant inroads on the range on mining issues. Oberstar got complacent whereas Chip Cravaack went to the mines and talked with the miners about the things that mattered most to them.
By paying attention, Chip Cravaack earned the voters' trust, something that can't be overemphasized in this election. That's how you serve your constituents.
Posted Sunday, December 5, 2010 5:36 AM
Comment 1 by walter hanson at 05-Dec-10 02:31 PM
Well if Chip can get that mine open over the next two years it should help him win an easy reelection since he did exactly what the voters wanted.
Walter Hanson
Minneapolis, MN
Sen. Schumer: Master of the Forked Tongue?
This weekend, little Chuckie Schumer authored a tax increase bill that would've raised the marginal tax rate on people making over $1,000,000 a year. During his press conference announcing this tax increase, Sen. Schumer specifically spotlighted hedge fund managers as greedy profiteers.
If ever there was someone who spoke with a tongue more forked than Sen. Schumer's, then there's reason to be afraid. This Washington Post article highlights how duplicitous Sen. Schumer is:
In early June, as the Senate Finance Committee began examining how a new breed of Wall Street titan could be paying a special low tax rate on executives' salaries, one of the richest of them, hedge fund manager Steven A. Cohen of SAC Capital Advisors, cut the Democratic Senatorial Campaign Committee a check for $28,500.
Just days later, with DSCC Chairman Charles E. Schumer (D-N.Y.) equivocating on legislation to raise taxes on publicly traded equity firms, hedge fund giant James H. Simons, who earned $1.7 billion last year at his Renaissance Technologies LLC, donated another $28,500 to the DSCC.
By late July, Schumer was off the fence, and on the side of the hedge funds and private-equity firms in opposing the Democratic legislation.
Later this week, Democrats will face more scrutiny over that choice. The House is to vote on a bill to stave off growth of the alternative minimum tax for a year, offer new tax breaks to middle-class homeowners and expand tax rebates for low-income parents, paid for largely by nearly $50 billion in tax increases on the burgeoning hedge fund and private-equity industries.
How times have changed. This week, Sen. Schumer is advocating for taxing millionaires. It wasn't that long ago when he was opposed to it:
Sen. Charles E. Schumer (D-N.Y.) says he opposes legislation that would raise taxes on hedge funds. (Chris Kleponis - Bloomberg News)
I didn't find this through a google search. I found it on Democratic Underground , where they aren't happy with this doublespeaking corruption machine:
Schumer can no longer be a voice for the Dems. He's killing us. He needs to go. What a slimebag and criminal.
It's painfully obvious that Sen. Schumer can't be trusted to put people ahead of personal interests. It's equally obvious that his tax proposal is a stunt designed to put people on the spot. That might work in keeping New Yorkers on your side but it's a great way to alienate independents living throughout the heartland, the midwest and the rust belt.
If Democrats want to know why people abandoned them in droves this fall, they needn't look further than this. People want to know that their politicians consistently tell the truth. We know that isn't happening with Sen. Schumer.
Posted Sunday, December 5, 2010 1:04 PM
Comment 1 by walter hanson at 05-Dec-10 02:28 PM
If we had a smart person running the NRSC they will be contacting these donors and telling them first get your donations refunded and than give them to the NRSC.
Unfortunately, we don't have somebody like a Charles Schummer running the NRSC which is why we're in so much trouble numbers wise in the US Senate.
Walter Hanson
Minneapolis, MN
The DFL's Big Tent?
Over the weekend, at the Republican State Central Committee meeting, a motion was passed by a 59-55 vote banning 18 high-profile ersatz Republicans from its conventions for the next 2 years , including the Republican National Convention.
Almost immediately, the Agenda Media's caterwauling began, accusing the MNGOP of being inhospitable to so-called moderates. That's utter nonsense. The Agenda Media's definition of a GOP moderate appears to be someone who only identifies themselves as a Republican when endorsing someone from a different party.
We heard this same caterwauling in 2008, when House Minority Leader Marty Seifert took away certain privileges from the so-called Override Six. Ron Erhardt chose not to run in the 2008 primary against Keith Downey, then ran as a Democrat in 2010. Kathy Tinglestad and Bud Heidegerken retired. Neil Peterson lost the MNGOP primary against Jan Schneider. Rod Hamilton and Jim Abeler are still members in good standing with the state party.
Craig Westover's post from this weekend highlights some important points that the Twin Cities' Agenda Media has ignored.
I stood with the majority on that vote. A decent respect for the opinion of my fellow Republicans, those Horner supporters rebuked by the party and the public at large requires I declare the reasons for my vote.
The vote was not a difficult one to take. Stripping these individuals of the ability to hold party office is a consequence fitting their actions. The high-profile state leaders were rebuked not for simply disagreeing with the Republican Party; they were banned from representing the party for abusing the Republican brand to actively work against the party.
Those rebuked by the Minnesota GOP were of value to the Horner campaign primarily because of their one-time endorsement by the Republican Party of Minnesota. They were sought out and welcomed by the Horner campaign because of the Republican brand. Their coming out for Horner was headlined by the Republican brand. What made the story significant was the Republican brand. What the Minnesota GOP has the obligation to protect is the Republican brand.
Whether you're part of the TEA Party movement that's holding politicians accountable or whether you're an activist elsewhere, people are demanding that politicians say what they mean and mean what they say. PERIOD. They don't want phonies who campaign as the world's best conservative, then govern as the world's biggest liberal/hypocrite.
As such, the MNGOP has an affirmative responsibility to state clearly what principles and which candidates they stand for. Sounding a clear trumpet signal lets people know several important things, the most important thing being that they're principled people.
Another important principle silently stated by following the state party's belief is that, whether you agree or disagree with the state party, you know that they put a high priority on being trustworthy.
These things are important, not just for protecting the GOP's brand but because the GOP got trampled for not standing for what they said they believed in. As a direct result, a rash of terrible policies became laws, not the least of which are Obamacare, the FinReg bill and the stimulus.
Had the GOP stayed true to their principles, the Democrats wouldn't have gotten the opportunity to pass Obamacare and the stimulus. In other words, standing for what you believe in has real life consequences that will, in all likelihood, cost thousands of families huge amounts of money.
This isn't just a debating point. It isn't an academic exercise. At its core, it's a debate about what type of Minnesota we want to live in because, let's face it, we can't implement the great policies if we don't have the votes.
Finally, it's worth noting that the DFL's complaining is purely hypocritical, especially in light of the fact that they wouldn't even let their eventual standardbearer onto this year's convention floor :
Before the party made its choice, Dayton was telling reporters in Duluth about what he called the DFL's "petty" choice to keep him off the convention floor. Within an hour of Kelliher's jubilant victory speech, Gaertner said she looked forward to a "vigorous primary." By Sunday, Entenza was flying around the state on "a primary campaign kickoff tour" and was planning to run TV ads this week to get his name in front of voters.
The DFL's big tent wasn't showing. The Agenda Media's bias showed through, too. Whereas Saturday's vote got major play on MPR, the DFL's keeping Sen. Dayton off the DFL Convention floor got a single paragraph buried deep in the Strib's article.
The lesson cnservatives need to learn, which I think they have for the most part, is that when the Agenda Media talks about big tents, it means the GOP should be more liberal and when they talk about compromise, what they're really talking about is conservative letting the DFL have their way.
That isn't compromise. That's caving. No thanks.
Posted Monday, December 6, 2010 5:34 PM
No comments.
Taking Issue With Paul Thissen
This morning, Tom Hauser had Amy Koch, Paul Thissen and Speaker-Designate Kurt Zellers in for an interview. Predictably, Thissen said that additional revenues were needed. He then criticized Gov. Pawlenty for Minnesota's budget problems.
Speaker Zellers said that the DFL has caused the problem by "too often using one-time money to solve" ongoing budgetary expenditures. The truth is that the DFL did budgeting backwards. They first determined how much they wanted to spend, then they adjusted tax policy to pay for their spending wish list.
When asked by Hauser what the likelihood of passing a tax increase to help balance the budget, incoming Senate Majority Leader Amy Koch said that she wasn't "interested in passing any job-killing tax increases." She rightly noted that the problem is on the spending side of things.
Another thing that the DFL was noted for was thinking of bonding bills as their jobs bill. While it's true some projects actually strengthen Minnesota's economy, it's more likely that bonding bills are just Keynesian economics gone awry. They don't strengthen the economy.
Republicans want to build a real economy, not just one artificially propped up by an annual stimulus bill.
Speaker-Designate Zellers also hit Rep. Thissen hard when he said that we still have a 1970s-based model of government. He said that Republicans planned on passing reforms that would structurally change state government, which is music to most voters' ears.
Rep. Thissen is cookie cutter in the sense that he's oblivious to creating a great economy. Clearly, it's a high priority to the GOP. They want to revamp government so businesses can get all their permits in one place rather than chasing down permits from one place to another to another.
At some point, the DFL will be forced to admit that their policies are directed at growing government and paying off their political allies, not at creating prosperity and growing the size of Minnesota's economy.
Growing Minnesota's economy will eliminate the deficit. Reforming MinnesotaCare and changing how Minnesota puts budgets together will reduce the size of government without cutting important services.
The DFL isn't as worried about the conservatives' plans failing as much as they're worried that they'll succeed.
That's the dirty little secret that the DFL hopes nobody notices.
Posted Monday, December 6, 2010 6:08 AM
Comment 1 by J. Ewing at 06-Dec-10 03:32 PM
I don't think it is quite correct to say the the fundamental of DFL governance is "growing government." That is the direct and observable result, certainly, but I think the underlying motivation is that they really, firmly believe that they are smarter than all of us put together, and "things" would be better if we just sat back and followed their dictates. Nowhere is that more obvious when they say that they are going to "create jobs." Out of WHAT? Isn't a "job" where you produce goods and services that somebody else is willing to buy? Government cannot do it, it's not possible. DFLers think they can.
Paul Thissen, Part II
After rereading this post about Sunday morning's @Issue With Tom Hauser interview, I realized that I'd omitted something important that I'll talk about here.
During the part of the interview where they talked about solving the budget deficit problem, Rep. Thissen said multiple times that Tom Emmer's budget was "a cuts-only budget." That's an intentional mischaracterization of Tom's budget.
If we're being accurate, the proper characterization of Tom's budget is that it's part cuts, in large part reforms and in large part economic growth.
Based on their public statements, it's safe to say that the budget that House and Senate GOP leadership is putting together is similar in principle though different in specifics from Tom Emmer's budget.
Incoming Senate Majority Leader Amy Koch made it clear that the economy won't perform well if they raise taxes. House Speaker-Designate Kurt Zellers made it clear that reforms will be part of the package, saying that state government is still operating on a 1970s model.
That's the message that the House and Senate GOP have tried telling the Twin Cities media the last 4 years. Now that they're in the majority, their proposals will get the headlines that they didn't before.
That should scare the DFL because discussing the merits of something isn't their strong suit. They're used to talking in platitudes and generalities, not specifics and basic economic principles.
The DFL talks about structural deficits, then takes one-time money for Early MA. That funding disappears in 2014 but the program continues. How does taking that money improve Minnesota's structural deficit? Rep. Thissen doesn't explain because there isn't a legitimate answer to that question.
I said in yesterday's post that Rep. Thissen and the DFL will have a difficult go with this GOP majority. I haven't seen anything to change my mind.
Posted Monday, December 6, 2010 3:16 PM
Comment 1 by Paul Thissen at 08-Dec-10 08:39 PM
I appreciate you're willingness to engage in a substantive discussion. I only want to respond with 2 points on early MA. The federal match does not disappear in 2014 for single adults. The match actually increases to a greater percentage match from the Feds and all states including MN are required to implement the program for single adults. Second, no one (yet) is proposing we eliminate coverage for these single adults under 75% of poverty and so it cannot be considered an expansion of a public program - we already do it thru GAMC and have for a long time. The only substantial difference is under MA we get the match. Finally the $1.4 billion federal match will not directly close the budget gap but will pump $1.4 billion into MN hospitals and clinics (and health care workers wallets thru jobs on the private sector) and better prepare those facilities for the cuts that may be facing them under the upcoming budget proposals.
Paul
