Here It Is: A Lucid Summary of our Economic Situation

Obstruct and ExploitBy PAUL KRUGMAN

Published: September 9, 2012 249 Comments

Does anyone remember the American Jobs Act? A year ago President Obama proposed boosting the economy with a combination of tax cuts and spending increases, aimed in particular at sustaining state and local government employment. Independent analysts reacted favorably. For example, the consulting firm Macroeconomic Advisers estimated that the act would add 1.3 million jobs by the end of 2012.
There were good reasons for these positive assessments. Although you’d never know it from political debate, worldwide experience since the financial crisis struck in 2008 has overwhelmingly confirmed the proposition that fiscal policy “works,” that temporary increases in spending boost employment in a depressed economy (and that spending cuts increase unemployment). The Jobs Act would have been just what the doctor ordered.



But the bill went nowhere, of course, blocked by Republicans in Congress. And now, having prevented Mr. Obama from implementing any of his policies, those same Republicans are pointing to disappointing job numbers and declaring that the president’s policies have failed.



Think of it as a two-part strategy. First, obstruct any and all efforts to strengthen the economy, then exploit the economy’s weakness for political gain. If this strategy sounds cynical, that’s because it is. Yet it’s the G.O.P.’s best chance for victory in November.



But are Republicans really playing that cynical a game?



You could argue that we’re having a genuine debate about economic policy, in which Republicans sincerely believe that the things Mr. Obama proposes would actually hurt, not help, job creation. However, even if that were true, the fact is that the economy we have right now doesn’t reflect the policies the president wanted.



Anyway, do Republicans really believe that government spending is bad for the economy? No.



Right now Mitt Romney has an advertising blitz under way in which he attacks Mr. Obama for possible cuts in defense spending — cuts, by the way, that were mandated by an agreement forced on the president by House Republicans last year. And why is Mr. Romney denouncing these cuts? Because, he says, they would cost jobs!



This is classic “weaponized Keynesianism” — the claim that government spending can’t create jobs unless the money goes to defense contractors, in which case it’s the lifeblood of the economy. And no, it doesn’t make any sense.



What about the argument, which I hear all the time, that Mr. Obama should have fixed the economy long ago? The claim goes like this: during his first two years in office Mr. Obama had a majority in Congress that would have let him do anything he wanted, so he’s had his chance.



The short answer is, you’ve got to be kidding.



As anyone who was paying attention knows, the period during which Democrats controlled both houses of Congress was marked by unprecedented obstructionism in the Senate. The filibuster, formerly a tactic reserved for rare occasions, became standard operating procedure; in practice, it became impossible to pass anything without 60 votes. And Democrats had those 60 votes for only a few months. Should they have tried to push through a major new economic program during that narrow window? In retrospect, yes — but that doesn’t change the reality that for most of Mr. Obama’s time in office U.S. fiscal policy has been defined not by the president’s plans but by Republican stonewalling.



The most important consequence of that stonewalling, I’d argue, has been the failure to extend much-needed aid to state and local governments. Lacking that aid, these governments have been forced to lay off hundreds of thousands of schoolteachers and other workers, and those layoffs are a major reason the job numbers have been disappointing. Since bottoming out a year after Mr. Obama took office, private-sector employment has risen by 4.6 million; but government employment, which normally rises more or less in line with population growth, has instead fallen by 571,000.



Put it this way: When Republicans took control of the House, they declared that their economic philosophy was “cut and grow” — cut government, and the economy will prosper. And thanks to their scorched-earth tactics, we’ve actually had the cuts they wanted. But the promised growth has failed to materialize — and they want to make that failure Mr. Obama’s fault.



Now, all of this puts the White House in a difficult bind. Making a big deal of Republican obstructionism could all too easily come across as whining. Yet this obstructionism is real, and arguably is the biggest single reason for our ongoing economic weakness.



And what happens if the strategy of obstruct-and-exploit succeeds? Is this the shape of politics to come? If so, America will have gone a long way toward becoming an ungovernable banana republic.

Yes, Republicans DO Think Americans Are Stupid

Paul Krugman


Revenge of the Three-Legged Stool

Another day, another Romney whopper. Now he says that he’ll keep the good parts of Obamacare, in particular coverage for people with pre-existing conditions, while scrapping the rest.



You can’t do that – and Romney knows very well that you can’t do that, because the logic that went into Romneycare in Massachusetts is the same as the logic behind Obamacare.



Suppose you want to guarantee that insurance is available to people with pre-existing conditions. Well, you can establish community rating, requiring that insurance companies make the same policies available to everyone. But if you stop there, you know what will happen: healthy people will opt out, leaving behind a high-risk, high-cost pool.



So you have to also have a mandate, requiring that people buy insurance. And you can’t do that without subsidies, so that lower-income people can afford their policies.



The inexorable logic of the situation, then, leads to a three-legged stool of community rating + mandate + subsidies = ObamaRomneycare.



So, does Romney think we’re stupid? Hey, he also thinks we’ll buy into his promises to slash taxes by $5 trillion but make up the revenue by closing unspecified loopholes in a way that doesn’t raise taxes on the middle class – which turns out to be arithmetically impossible. So the answer is, yes, he thinks we’re stupid.



.

Remember What Bill Says

In his autobiography Bill Clinton points out one significant fact of progressive politics: the country can absorb only so much change at once.  The historical Progressive Era was an anomaly with so much change in a relatively short period of time.  Meaning: Progressives should be happy with what the President has accomplished so far.  Expectations were unrealistic to start with.  Change is especially slow in this Tea Party country.

Robert Reich - Beyond Outrage

In this slim book Reich, Bill Clinton's former Sec. Of Labor and now professor at Berkeley, has a simple thesis.  The basic economic problem in this country is increasing inequality, which erodes middle class purchasing power, which is why the economic recovery is so slow.  The middle class is not spending which means that businesses are not expanding and hiring.  The middle class is being squeezed as economic gains go mostly to the rich.  If Romney wins, things will only get worse as the Republicans are interested in cutting taxes for the rich.

Off and Running

The presidential race begins in earnest.  It all comes down to turnout in the so-called swing states.  Both sides know which are the swing states.  The burden is heavier for Romney.  He needs more of the swing states than Obama.

Bill Brings It

Bill Clinton Brings a Passion Infusion to the DNC

by Howard Kurtz Sep 5, 2012 11:30 PM EDT

The former president fused folksiness and wonkiness in boosting his successor. Howard Kurtz on how he made the case that Obama struggles to make for himself.

Bill Clinton, riding to the rescue of his Democratic successor, delivered an entertaining tour de force Wednesday night, saying the Republicans had created a “total mess” that Barack Obama is still cleaning up.



“If you want a you’re-on-your-own, winner-take-all society, you should support the Republican ticket,” Clinton said. “If you want a country of shared prosperity and shared responsibility—we’re-all-in-this-together society—you should vote for Barack Obama and Joe Biden.”



With one line, Clinton both acknowledged and neutralized Obama’s natural reserve, as a leader “who’s cool on the outside but who burns for America on the inside.”



And by the way, Clinton got so wound up that he went long—not that anyone in the crowd was complaining. Even some conservatives on Twitter called it a great speech.



It was an extraordinary spectacle on the second night of the convention, with a once-impeached president trying to transfer some of his late-in-life popularity to the man who defeated his wife four years ago—and actually placed his name in nomination.



Whether out of conviction or political convenience, Clinton demonstrated anew a skill that Obama barely possesses, to translate complex policy arguments into simple human terms. And his starpower also guaranteed maximum media attention on the evening after Michelle Obama drew praise for her highly personal speech.



Teeing up the Charlotte crowd were Sandra Fluke, the Georgetown law student who briefly gained fame when Rush Limbaugh called her a slur, and Elizabeth Warren, a liberal hero who is nonetheless trailing Scott Brown in the Massachusetts Senate race.



Clinton’s value to Obama, beyond his rhetorical gifts, rests on the positive memories stirred by his eight years of peace and prosperity. That record was badly marred by his sexual hijinks with Monica Lewinsky, which led Republicans to try to drive him out of office. But as that scandal has receded into history, the balanced budgets and welfare reform he forged with the Gingrich Republicans look pretty good compared to today’s bitter Beltway paralysis.



Former Clinton and Obama aide Rahm Emanuel, now Chicago’s mayor, drew the analogy in an interview, saying a Democratic victory would force Republicans to come to the table as they did in Clinton’s second term.



“Heck, he appointed Hillary!”



The 42nd president of the United States Bill Clinton makes a point during his address at the Time Warner Cable Arena in Charlotte on Sept. 5, 2012, the second day of the Democratic National Convention (Robyn Beck / Getty Images)



With former Clintonites roaming the streets of Charlotte—Terry McAuliffe, Joe Lockhart, Harold Ickes—the night served as both a 20th anniversary of the man’s election and his reemergence as more than a Cabinet spouse with a cool global foundation.



What Clinton brought to the stage was the politics of joy, a performer with a playful sense of humor who revels in and draws strength from the crowd.



He deftly ridiculed the shift in the GOP by recalling how he worked with Republicans both in the White House and his post-presidency. “I actually never learned to hate them the way the far right that now controls their party seems to hate our president,” Clinton said.



And who else could wave off the tensions of 2008, when Obama aides believed Clinton was making a borderline racist appeal, by noting that the president had put several Hillary aides in the Cabinet—“Heck, he appointed Hillary!”





Did I mention he went long? Too long, closing in on an hour, crashing past the 11 p.m. deadline, refusing to stop until he had beat the viewing audience into submission. By the end Clinton was spewing statistics, as he did in those State of the Union marathons, and losing rhetorical steam. But he didn’t care. This was his moment, and he wasn’t going quietly. Clinton ensured that reviews of a boffo speech would morph into reviews of an endless speech.



It was a wonky speech at times, more theater than dramatic oration, a classic Clintonian riff. Whether it helps Obama repeat the Clinton feat of winning a second term is far from clear. But as Bubba is wont to do, he sucked up all the oxygen in the room.

About Bill's Speech

HA!  The speech was too long only if you were a Republican.

The Huffington Post
By Rebecca Shapiro Posted: 09/05/2012 11:37 pm Updated: 09/06/2012 1:36 am



.Follow: Bill Clinton, Video, 2012 Democratic National Convention, 2012 Democratic National Convention Media Coverage, Bill Clinton DNC Speech, Bill Clinton Democratic National Convention, Bill Clinton Dnc Speech Media Coverage, Democratic National Convention Media Coverage, Dnc Media Coverage, Media Coverage Dnc, Media News . Media figures gave President Bill Clinton their seals of approval on Wednesday night after he energetically supported President Barack Obama as the Democratic Party's nominee for president of the United States, though some pointed out that he did seem to talk for a long time.



Clinton took the stage shortly after 10:30 p.m. in Charlotte, North Carolina, and spoke for well over 40 minutes. He continued speaking into the 11:00 p.m. hour, causing CBS and ABC to delay their local news broadcasts (NBC aired football instead of the second night of the DNC).



Immediately following the speech, the praise started pouring in. Wolf Blitzer led the pack on CNN. "I've been watching this president...going back to 1992 when I was CNN's White House correspondent," he said. "This may have been the best speech I have ever heard Bill Clinton deliver over all these years."



GOP strategist and CNN pundit Alex Castellanos said that Clinton's speech tilted the scale. "Tonight when everybody leaves, lock the door. You don't have to come back tomorrow. This convention is done. This will be the moment that probably re-elected Barack Obama," he said.



Fox News' Brit Hume said that Bill Clinton "is the most talented politician [he's] ever covered and the most charming man [he's] ever met." He added, "No one in my view can frame an argument more effectively than he can."



Hume also said that the speech was "convincing" but "a little self-indulgent, and about thirty percent too long," which he described as "par for the course for Clinton."



Anderson Cooper commented on the unexpected specificity in Clinton's speech. "The level of detail in the speech was quite surprising...and yet there was a personability," he said. Paul Begala, a Clinton confidante, said on CNN: "I don't know anybody else that can be as substantive and yet as riveting."





MSNBC's Chris Matthews made it clear that he thought Clinton did what he needed to do. "Bill Clinton came in and beat up the other side...he hit them hard where they were weak," he said. "I wouldn't want to be the guy fighting Bill Clinton if the issue is Barack Obama." Andrea Mitchell called it an "extraordinary speech."



While Clinton's delivery was heavily praised, the length of the speech was used as a point of criticism. Pundits were quick to comment on the length of Clinton's speech as the former president consistently riffed off his prepared remarks, making the speech last longer than originally anticipated.



Fox News hosts had several remarks about the running time. Bret Baier immediately noted that Clinton spoke for nearly 50 minutes. Megyn Kelly said that the crowd "ate up" Clinton's remarks, but also quickly commented on the length. Charles Krauthammer opined that the speech would not "move the needle" a bit, and said Clinton probably spoke for so long as revenge for the 2008 presidential campaign.



CNN's John King also mentioned the speech's length, saying, "Like every Clinton speech, it could use an editor."