2011 - %3, November

Mitt Romney in His Own Words

| Tue Nov. 22, 2011 1:16 PM EST

This is pretty funny. From ThinkProgress, it's Mitt Romney, in his own words, according to the Romney standard of accuracy. Enjoy.

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Poor People to Get Poorer

| Tue Nov. 22, 2011 1:00 PM EST

The failed congressional super committee and its inability to agree on $1.2 trillion in deficit-reduction measures to help stabilize the nation's finances has dominated the news this week. Americans for Tax Reform's Grover Norquist may be despairing, but there's new evidence emerging that some key parts of the federal budget are shrinking without any extra help from Congress, at a time when some of those programs are desperately needed.

The Temporary Assistance for Needy Families (TANF) program is designed to provide cash assistance to poor families. It's sort of a last resort cushion after unemployment benefits and family charity have run out. Before 1996, it was better known, somewhat derisively, as welfare. But in 1996, Congress, with the blessing of President Bill Clinton, decided welfare needed reforming. The old program had been an entitlement program, much like food stamps or unemployment benefits—programs with budgets that automatically rose when the need did. Times like now, when the country has seen increases in the poverty rate for three consecutive years and has more Americans living in poverty than at any other time in more than a half-century.

In 1996, welfare was turned into a block grant and its budget was fixed at $16 billion, so that states received roughly the same amount of money every year, regardless of how many people might be out of work and suffering. Many Republicans in Congress would like to do this to the Medicaid program. But TANF should serve as a serious cautionary tale about what happens when the safety net is left up to the congressional appropriations process. Congress hasn't increased the TANF block grant since it was created. As a result, new data from the Center on Budget and Policy Priorities shows that the value of cash benefits to poor families have fallen by as much as 30 percent in some states simply because of inflation—call it a stealth budget cut.

The reduction in TANF benefits is now going beyond just the erosion from inflation: In many cash-strapped states, legislators have diverted money from the block grant to pay for other things, while slashing benefits to poor families at a time when unemployment has been consistently high. Six states have cut benefits just in the past year.

Center on Budget and Policy PrioritiesCenter on Budget and Policy PrioritiesIn the District of Columbia, for instance, the monthly TANF benefit for a family of three is now $342, not anywhere near enough to pay the rent, for instance. Once upon a time, welfare or TANF benefits were enough to at least keep needy families above 50 percent of the federal poverty line (about $9,000 a year for a family of three). But TANF benefits are now so low that they aren't enough to keep anyone out of deep poverty, which is a troubling development. According to CPBB, a family relying only on TANF for support during tough times would be much poorer today than such a family in 1996.

The future only looks grimmer. CPBB reports that because many states are suffering from enormous budget deficits, more TANF cuts are on the table, even in places like Washington state, which cut benefits by 15 percent last year. That means millions of American families aren't going to have much to be thankful about this week. Even if they can scrape together a decent green bean casserole for Thanksgiving, they'll probably be skipping Black Friday at Walmart for years to come.

Raw Data: The Laffer Curve for the Rich

| Tue Nov. 22, 2011 12:05 PM EST

Okay, this isn't actually raw data. In fact, it's very, very cooked and calculated data. But just so you know, Peter Diamond and Emmanuel Saez have tried to calculate the tax rate on the rich that would maximize revenue to the government. Paul Krugman summarizes:

In the first part of the paper, D&S analyze the optimal tax rate on top earners. And they argue that this should be the rate that maximizes the revenue collected from these top earners—full stop. Why? Because if you're trying to maximize any sort of aggregate welfare measure, it's clear that a marginal dollar of income makes very little difference to the welfare of the wealthy, as compared with the difference it makes to the welfare of the poor and middle class. So to a first approximation policy should soak the rich for the maximum amount—not out of envy or a desire to punish, but simply to raise as much money as possible for other purposes.

Now, this doesn't imply a 100% tax rate, because there are going to be behavioral responses—high earners will generate at least somewhat less taxable income in the face of a high tax rate, either by actually working less or by pushing their earnings underground. Using parameters based on the literature, D&S suggest that the optimal tax rate on the highest earners is in the vicinity of 70%.

Actually, Krugman is being conservative here. If you assume a broad base and no deductions, Diamond and Saez peg the revenue maximizing rate for top earners at 76 percent. That's for federal income tax only. (See page 173 here.)

You can decide for yourself if you think top marginal rates should be that high. After all, revenue maximization isn't our only social goal. Roughly speaking, though, this is a calculation of the peak of the famous Laffer Curve. (For top earners, anyway.) Above 76 percent, you really can generate higher revenues by lowering tax rates. Below that, higher rates generate higher revenue, just like you'd think.

Note that this is a result that both liberals and conservatives ought to take some satisfaction in. For liberals, it's confirmation that current tax rates are far, far below the Laffer maximum. We can raise marginal rates from 35 to 40 percent with only minor deadweight losses. For conservatives, it's justification for the 1981 Reagan tax cuts. When top rates were at 70 percent, reductions may not have literally paid for themselves, but they probably lowered revenue fairly modestly. We really were pretty close to the Laffer maximum in the '60s and '70s.

Quote of the Day: Mitt Romney's Lie

| Tue Nov. 22, 2011 11:13 AM EST

From Barack Obama, in Mitt Romney's latest ad:

If we keep talking about the economy, we're going to lose.

What Obama actually said, campaigning against John McCain on October 16, 2008:

Senator McCain's campaign actually said, and I quote, "if we keep talking about the economy, we're going to lose."

Just out of curiosity: How flat-out, knowingly false does something have to be before the press is willing to just call it a lie? We're about to find out!

Telling the Truth About Politics

| Tue Nov. 22, 2011 10:41 AM EST

From an LA Times editorial this morning:

Engaging in self-caricature, the Republicans insisted on no new taxes, a posture they modified slightly to propose $250 billion in new revenues, some offset by their other proposals, including making the Bush-era tax cuts permanent. Democrats, meanwhile, irresponsibly resisted meaningful cuts in domestic programs. Hobbled by their dogmatic opposition to taxes, the Republicans were arguably more intransigent. But both parties deserve blame for the anticlimactic outcome of the committee's work. The super committee was supposed to cut through the partisan pettiness that prevented a deal as part of the process to raise the federal debt ceiling. Instead, "super" proved to be SOP.

Can we please cut out this brand of horseshit? The facts: Democrats initially proposed a plan that, among other things, included $500 billion in Medicare and Medicaid savings and several hundred billion dollars in Social Security savings via a new inflation formula. Republicans responded with a package that was pure spending and benefit cuts. They followed that with a plan that included $300 billion in tax increases paired with an extension of the Bush tax cuts, which was very plainly a net tax decrease that exploded the deficit rather than reducing it. Democrats responded with a revised plan that included new revenues plus substantial cuts to Medicare, Medicaid, Social Security, and other domestic programs. In other words, Democrats were willing to propose cuts in domestic programs. It was exactly the same dynamic that played out during the debt ceiling debacle, with Obama persistently offering up big plans that included significant entitlement cuts and Republicans flatly rejecting them because they also included new revenues.

Look: Democrats are no angels. They're politicians, and they're driven by the same grubby political motives that animate all politicians. But Republicans are "arguably" more intransigent? "Both parties deserve blame"? Come on. What exactly would Democrats have to have done in order to avoid this lazy formulation? How much compromise were they supposed to offer in the sure knowledge that every single one of their offers would be rejected out of hand if it included even a dime of tax increases?

This is ridiculous. When is the American media going to ditch its obsession with looking neutral at all costs and simply tell its audience the actual truth? Tomorrow would be a good time to start.

Amazon Users Review the UC-Davis Cop's Pepper Spray

| Tue Nov. 22, 2011 8:17 AM EST

Reviewers at Amazon are getting their digs in at Lt. John Pike, the campus police officer at University of California-Davis who pepper-sprayed a group of non-violent student protesters and has already become an Internet meme symbolizing police overreaction to the Occupy protests.

On the product reviews page for the brand of pepper spray apparently used by Pike, visitors have added views like "Perfect for use against peaceful protesters, especially ones who are sitting down and pose no threat," and "It really is the Cadillac of citizen repression technology."

 

While the reviews are pretty funny, as my colleague Kate Sheppard writes, getting a burning chemical that is 1,000 times hotter than a jalapeno pepper sprayed in your face isn't exactly a hay ride. 

A one-star review warns, "I used this on a small crowd of harmless non-violent protesters, and lost my job. That particular hazard was NOT listed among the warnings on the label." But so far Pike, along with the police chief of UC-Davis and one other officer, has only been suspended.

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Your Tax Dollars Help Cargill Export Factory Meat

| Tue Nov. 22, 2011 7:03 AM EST
Pigs stuffed together in a factory farm—or agribiz giants lined up at the government trough?

The US Meat Export Federation has a straightforward mission: to open foreign markets to the output of our vast factory animal farms. The group represents all major players in the US industrial meat machine: the dominant meatpackers (Cargill, Smithfield, Tyson, and JBS); the big farm interests that grow their feed (American Soybean Association, the Iowa Corn Growers Association); and the agrichemical giants that supply corn farmers with inputs (Monsanto and Dupont).  

Now, I deplore the US meat industry for all of its many abuses, but I'm not shocked that it has formed an interest group to push its suspect products on overseas markets. But this? It's nuts. Under a USDA initiative called the Market Access Program, US taxpayers will be cutting a check to the US Meat Export Federation for $19.7 million in fiscal 2012.

Study: K Street Is Holy Place

| Tue Nov. 22, 2011 6:26 AM EST

God is everywhere—even K Street. According to a new study from the Pew Research Center’s Forum on Religion & Public Life, the number of organizations involved in religious lobbying or religion-related advocacy has increased nearly fivefold since 1970. At least 1,000 people work to extend God's influence in Washington, spending at least $390 million a year in the process.

Whose God has the most pull on Capitol Hill? It's unclear: roughly a fifth of the religious advocacy organizations in Washington push issues of concern to the Roman Catholic community, while a similar proportion represent evangelical Protestant interests; 12% are Jewish. And the heavy hitters cover a pretty broad range of religious persuasions:

Federal lobbying laws could be allowing some of these groups to avoid full disclosure of their advocacy work. Only 10 of the groups surveyed by Pew are registered as 501(c)(4)s, which are allowed to engage in a limited amount of lobbying. Over 80 percent of the groups are registered as nonprofit, tax-exempt 501(c)(3)s. Under that designation, they're not allowed to devote a "substantial" share of their activity to lobbying. (Twenty-six groups are 501(c)(3)s that have a partner group registered as a 501(c)(4), or vice versa.)

What qualifies as "substantial" activity devoted to lobbying? According to federal law, religious institutions must disclose their lobbying if more than 20 percent of an employee's income is from direct lobbying on behalf of that institution. If a religious group hires an outside firm to do its lobbying, that firm must disclose that it has lobbied on behalf of a religious institution. But the 20 percent rule is rarely enforced, according to the Center for Responsive Politics (CRP).

CRP also found that during the first three quarters of 2011, 23 religious groups hired 68 new lobbyists and spent a combined $1.7 million. The upshot: with hot-button social issues like reproductive rights and Planned Parenthood funding atop the agenda for Republican lawmakers in Washington, expect these numbers to continue to rise.

The Collected Poems of Willard Mitt Romney

| Tue Nov. 22, 2011 6:17 AM EST
GOP presidential candidate Mitt Romney reads an original composition to an unsuspecting Nevada retiree.

It has been said that Mitt Romney is awkward.

It is just a vicious rumor, of course; there is nothing to it. But the tag has stuck. Blame the Daily Show; blame the former Massachusetts governor's GOP rivals; blame deadpan press reports like this one. Viewed in that light, Romney's ordinary encounters take on an altogether different complexion. "Andrew is a great name; a lot of good Andrews out there," he told a supporter in New Hampshire on Sunday. "Ian—that's kind of a British name," he told a man named Ian in October. They're fairly ordinary statements (and both true), except Romney is considered awkward, and so those exchanges are, consequently, very awkward.

But there's another way of looking at the wit and mannerisms of the occasional GOP frontrunner: underappreciated poet.

Consider this passage, from a November speech in Troy, Michigan:

I love the lakes.

I love the Great Lakes.

You know, we’ve been to Massachusetts—I love the ocean, too.

I do love the ocean.

Mitt Romney/FlickrMitt Romney/Flickr

Oiled Penguins Go Free

| Tue Nov. 22, 2011 6:00 AM EST

Little blue penguin.: Credit: Noodle snacks via Wikimedia Commons.Little blue penguin Noodle snacks via Wikimedia Commons.

Forty-nine of 343 little blue penguins rescued from the oil spill off the New Zealand coast were released back into the ocean yesterday—with more to come in the next few weeks, says Maritime New Zealand.

At least 2,008 birds died.

When Rena grounded on October 5, it contained 1,712 tons of oil. About 360 tons spilled into the ocean. The 1,319 tons remaining were removed under really tough conditions by November 13. Kudos to the salvors.

 

The freed penguins were released into the Bay of Plenty with hopes they'll make their way back to their breeding rookery on Rabbit Island.

Bonne chance, little dudes.