This blog hasn't been updated a while, due to the fact that I've been blogging elsewhere and likely will be for the foreseeable future. However, this blog will stay up, both as an archive and for personal blogging.
Future political/academic blogging will be at The Realignment Project.
Sunday, July 26, 2009
Saturday, May 30, 2009
Note: This is a cross-post from my group blog The Realignment Project and DailyKos. Background: So for people who haven't maybe been following the back and forth over the health care bill, the basic elements of the legislation being covered are these: The Kennedy Memo: The key purpose of the Kennedy memo (which you can find here) seems to be an effort to shift the terms of the debate, and the eventual legislation left-wards. Not quite in the same way that single-payer advocates are hoping to do, but in a more traditionally moderate liberal fashion, focusing on the expansion of public programs. Kennedy accomplishes his aims in a number of ways. Private Insurance Reforms: Sliding-Scale Subsidy: Here's the big one, and it's snuck in via a short paragraph. The Baucus bill being drafted assumes some kind of sliding-scale subsidy to help pay for premiums, but a rather limited one. Kennedy's memo calls for "sliding scale premium assistance for individuals and families with income up to four times the federal poverty level to help them purchase quality health insurance policies." This is crucial, both in the policy and the politics. Policy-wise, this means that the money involved is likely to be substantial, bringing people's medical costs down substantially (which would have beneficial ripple effects on living standards and consumer spending), and ensuring that people lower down on the income scale really can afford the premiums. However, politically, it's very important that a family of 4 making $88,000 a year would be eligible for subsidies. That means that the subsidy provision would be a relatively universal benefit that the middle class would enjoy. This builds a huge potential coalition for this benefit, which is crucial for turning it into the future equivalent of Social Security or Medicare, rather than the future equivalent of AFDC. It also makes the overall bill more of a political winner for politicians - who doesn't want to pass a bill giving millions of middle-class voters unsubstantial checks? Health Exchange: Nothing particularly new here, although it's very explicit that "To ensure that fiscal discipline and full accountability are built into this new structure, one health insurance option available to participants will be a publicly sponsored and guaranteed plan." I think the guaranteed is quite important - it means that the public plan in question could not be a spun-off Amtrak like affair, but something that had the financial support of the U.S government, and thus would be as sound as the rock of Gibraltar. Individual Mandate: Boilerplate here, although the phrasing "national health reform requires that everyone who can afford to must sign up for coverage," is important, putting emphasis on ensuring affordability front-and-center. Not Included in the Memo: Although this was in a separate email, according to Politico, two important key elements of the Kennedy plan should be included in this discussion: "in an e-mail summary that began circulating this week, Kennedy was described as considering a public insurance option that would pay providers slightly more than Medicare rates...He would also expand the Children’s Health Insurance Program to cover individuals up to 26-years old – up from 18." These two details are crucially important. First, the payment rates - this is important for several reasons. It means that doctors and the AMA will have more of an incentive to back Kennedy's version than Baucus' version; it also means that the resulting public insurance plan would actually be widely accepted and usable, and hence worth purchasing, as opposed to something like Medicaid where it's very hard to find doctors who accept it; it also means that costs should be closer to the Medicare model than the private insurance model. Second, the CHIP expansion - if, as I suspect, this is paired with an expansion of Medicare down to 60 or maybe 55, this is an important step in gradually moving us in the direction of single-payer. People like Medicare a lot, they like CHIP a lot as well, and moving people away from insurance-based-on-employment to insurance-based-on-citizenship is a crucial intermediary step. So there you have it. Now, Baucus' plan is significantly to the right of this, and Schumer's weird thing is to the right of that. However, by putting this plan out there as the HELP committee's bill and the bill that's on the table, it changes the terms of the debate by establishing a positional bargaining point that's significantly in the direction of more leftward alternatives, which in turn shifts the middle ground away from industry's preferences.
So, if you've been following the day-to-day drama over the health care bill - Baucus says he'll fight for public option! Ben Nelson backs off opposition! Schumer tries for some weird single-payer/trigger double play! - then you've probably heard about Senator Kennedy's attempt to push the emerging bill to the lift by getting his HELP Committee's version of the bill out first and pushing Baucus to the left.
Well people have been asking about the details of what this 12 page proposal that's been circulating are.
Well, look no further!
So for people who haven't maybe been following the back and forth over the health care bill, the basic elements of the legislation being covered are these:
The Kennedy Memo:
The key purpose of the Kennedy memo (which you can find here) seems to be an effort to shift the terms of the debate, and the eventual legislation left-wards. Not quite in the same way that single-payer advocates are hoping to do, but in a more traditionally moderate liberal fashion, focusing on the expansion of public programs.
Kennedy accomplishes his aims in a number of ways.
Private Insurance Reforms:
Here's the big one, and it's snuck in via a short paragraph. The Baucus bill being drafted assumes some kind of sliding-scale subsidy to help pay for premiums, but a rather limited one. Kennedy's memo calls for "sliding scale premium assistance for individuals and families with income up to four times the federal poverty level to help them purchase quality health insurance policies."
This is crucial, both in the policy and the politics. Policy-wise, this means that the money involved is likely to be substantial, bringing people's medical costs down substantially (which would have beneficial ripple effects on living standards and consumer spending), and ensuring that people lower down on the income scale really can afford the premiums. However, politically, it's very important that a family of 4 making $88,000 a year would be eligible for subsidies. That means that the subsidy provision would be a relatively universal benefit that the middle class would enjoy. This builds a huge potential coalition for this benefit, which is crucial for turning it into the future equivalent of Social Security or Medicare, rather than the future equivalent of AFDC. It also makes the overall bill more of a political winner for politicians - who doesn't want to pass a bill giving millions of middle-class voters unsubstantial checks?
Nothing particularly new here, although it's very explicit that "To ensure that fiscal discipline and full accountability are built into this new structure, one health insurance option available to participants will be a publicly sponsored and guaranteed plan." I think the guaranteed is quite important - it means that the public plan in question could not be a spun-off Amtrak like affair, but something that had the financial support of the U.S government, and thus would be as sound as the rock of Gibraltar.
Boilerplate here, although the phrasing "national health reform requires that everyone who can afford to must sign up for coverage," is important, putting emphasis on ensuring affordability front-and-center.
Not Included in the Memo:
Although this was in a separate email, according to Politico, two important key elements of the Kennedy plan should be included in this discussion: "in an e-mail summary that began circulating this week, Kennedy was described as considering a public insurance option that would pay providers slightly more than Medicare rates...He would also expand the Children’s Health Insurance Program to cover individuals up to 26-years old – up from 18."
These two details are crucially important. First, the payment rates - this is important for several reasons. It means that doctors and the AMA will have more of an incentive to back Kennedy's version than Baucus' version; it also means that the resulting public insurance plan would actually be widely accepted and usable, and hence worth purchasing, as opposed to something like Medicaid where it's very hard to find doctors who accept it; it also means that costs should be closer to the Medicare model than the private insurance model. Second, the CHIP expansion - if, as I suspect, this is paired with an expansion of Medicare down to 60 or maybe 55, this is an important step in gradually moving us in the direction of single-payer. People like Medicare a lot, they like CHIP a lot as well, and moving people away from insurance-based-on-employment to insurance-based-on-citizenship is a crucial intermediary step.
So there you have it. Now, Baucus' plan is significantly to the right of this, and Schumer's weird thing is to the right of that. However, by putting this plan out there as the HELP committee's bill and the bill that's on the table, it changes the terms of the debate by establishing a positional bargaining point that's significantly in the direction of more leftward alternatives, which in turn shifts the middle ground away from industry's preferences.
Tuesday, May 26, 2009
In light of Obama’s recent Supreme Court nomination and the likely fight over the liberal vs. conservative direction of the Supreme Court, I’d like to reflect on how recent and unusual it is that the major political conflicts around the Court have revolved around questions of abortion and the rights of the accused, as well as other so-called “personal freedoms.” Don’t get me wrong, however – I’m not arguing that there has been a recent politicization of an otherwise neutral Court. I find that to be a ridiculous assertion. In a democracy, law and its interpretation is inherently political, an expression of our most deeply-held beliefs about the extent and expression of our rights, the meaning and reality of justice, the nature and scope of the state and the market, our very definition of what freedom, equality, democracy, privacy, independence, speech, mean.
Historically, however, the conflicts over the Court have gone through phases: before the post-1973 struggle over abortion, Court politics largely revolved around questions of civil rights (especially questions around affirmative action and de-segregation) which exploded onto the national consciousness in 1954, but had obviously been brewing for at least ten years before that. However, the longest-lasting political fight over the Court has been the fight over the nature of the state and the economy, and the competing claims of democracy and property rights, that arguably lasted from the end of the Civil War (many of the Civil Rights Cases that emasculated Reconstruction and its 13th, 14th, and 15th Amendments revolved around questions of economic regulation) through to the 1940s.
I’d like to consider this particular political struggle, because I think it illuminates the critical importance of the law and the Supreme Court in shaping the most fundamental political decisions in our country’s history (which raises the question of how democratic our decision-making process really is), and because it shows that the true fight being carried on is not actually a fight over the law (because neither side has even been consistent regarding separation of powers, judicial independence or activism, strict constructionism versus more expansive legal philosophies, etc.), but rather a broader fight over the direction of national policy. In that sense, both sides believe that the court “is where policy is made” in our peculiar system of checks and balances, but not everyone’s honest about it.
Before I start, let me just say that there’s so much to learn about the relationship between the law and policy that this post is really inadequate. I would recommend the following books. William Novak’s The People’s Welfare, Michael Curtis’ No State Shall Abridge, Ned Beatty’s Age of Betrayal, William Forbath’s Law and the Shaping of the Labor Movement, Morton Horwitz’s Transformation of American Law, and Martin Sklar’s Corporate Reconstruction of American Capitalism, just for starters. They’re books every citizen should read, and they make great summer reading (for amnesiacs and political/legal junkies).
The reason I’ve singled out Santa Clara is that it’s a great example of how a small, almost unnoticed change in the law can have huge political ramifications, and also a good example of how law, even Supreme Court super-schmancy Constitutional law, is really politics with fancier words.
First, the background - in the 19th century, the railroad was the economic thoroughfare of life, especially in rural farming districts and anywhere out West; agricultural products traveled from country to town, and from the rural West to the urban East via rail, industrial goods went from the cities to the countryside, and from the developed East to the developing West via the same routes. As a result, railroads were perfectly placed to extract massive monopoly rents from their unique position, and did – there’s a reason why the first big corporations were railroad corporations, why they invested massively in political lobbying, and why they received such political largess in the form of Federal aid and land-grants to finance railroad construction. At the same time, the railroads began diversifying their interests – they used their position as carriers and huge landowners to exert a huge influence over the agricultural market, often buying up large percentages of the yearly crop through their carrier fees, they were bought out or merged with coal and steel companies to vertically integrate the product from the mine to the mill to the shop, and so forth. This naturally touched off a huge reaction across the country – in the East, the American labor movement rose against industrial corporations starting in the 1870s and in the railroad industry first; on the Great Plains and out West, the Populist movement began to rise; but throughout the country, even your garden variety republicans turned against the railroads and embraced education.
Out in California, the major struggle was between the state and the railroads. The major California railroads, especially the Southern Pacific, not only dominated the agricultural market through their monopoly on commerce, but also through their massive land holdings, and their whole-sale purchase of the state legislature. As a result, the major impulse behind California Populism was the fight against the railroads, the drive to regulate railroad rates, to tax railroad property, and to reform the political system.
And Santa Clara was fundamentally a fight over whether the state could tax railroad property, in this case, the fencing along the right of way. Ultimately, a minor, almost piddling issue. The true consequences of the case was the obiter dicta that “The Court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution which forbids a state to deny to any person within its jurisdiction the equal protection of the laws applies to these corporations. We are all of opinion that it does.” With those two sentences, not even decided by the Court but rather added in a headnote by John Chandler Bancroft Davis, the Court’s Reporter (and coincidentally the former president of the Newburgh & New York Railroad Co.), a massive change in American law was made. Where previously corporations had been viewed with suspicion as artificial creations of the state that should be carefully regulated to protect the “salus populi” (the people’s welfare), now they were legal persons with all of the rights that had been judicially stripped away from the freedmen. As a result, any regulation, any tax, any government action that could be construed as damaging to the rights of a corporation could be challenged under law as a violation of equal protection, or substantive due process, or any other right under the 14th amendment.
This one decision massively upended the political balance between corporations and their adversaries, bringing the courts (and thus the law-enforcement powers of the state) into the fray against them. Railroad rate regulations to stop railroads from robbing farmers blnd or rigging markets in favor of particular trusts? Violations of due process. Health and safety regulations? Violations of equal protection if they weren’t the same for all industries. Unions and strikes? Out of the question. And so it went.
Part of the tragedy of the decline of a genuine liberalism in the legal profession, a shrinking away from the boldness of the Warren Court years, has been a hesitancy to challenge the assumptions about the free market and the nature of property that are at the very basis of the corporation’s advantage in the courts. This is especially problematic because the conservative legal movement has not been so hesitant. One of their major goals, along with eviscerating a woman’s right to choose or the right to privacy, is a full-blown assault on the modern reading of the Commerce Clause. As Clarence Thomas has written, “our case law has drifted far from the original understanding of the Commerce Clause. In a future case, we ought to temper our Commerce Clause jurisprudence in a manner that both makes sense of our more recent case law and is more faithful to the original understanding of that Clause.” This is the ball game right here. If the Commerce Clause goes, so does all economic regulation, so does any environmental or labor regulations, and so does anti-discrimination legislation in the field of employment or housing.
So when we gear up for Sotomayor, or for whoever Obama picks next, there is a much bigger fight we need to be ready for, and there is no reason why we should think defensively about what’s possible in the realm of the law.
Saturday, May 23, 2009
In the run-up to the universal health-care bill being debated in Congress, one of the more contentious issues on the political left has been the question of single-payer and its’ inclusion or exclusion from the debate. Recently, we’ve seen single-payer advocates getting themselves arrested to draw media attention, a huge amount of back-and-forth within the progressive blogosphere (of which the links here are just a small sampling), and a good deal of fear about the public option getting watered down or eliminated.
I feel somewhat ambivalent in this debate, in part because I agree with the policy of single-payer advocates, but I find myself turned off by their political style. And I think a lot of it has to do with a particular theory of activism and an ahistorical understanding of how social policy happens that I really disagree with.
Especially as we draw closer to the crucial mark-up and voting phases, and ever closer to passage of the Baucus/Kennedy/Dingell/Obama health care legislation, it’s imperative that the progressive movement think very carefully about what we want to accomplish.
One of the ironies about the debate over the current health care reform versus single-payer is that the basis for the current plan (and indeed, the rough consensus between the Clinton, Edwards, and Obama plans during the 2008 primaries), the “Hacker Plan” – was designed as a compromise measure between gradualists who favored things like the exension of SCHIP in the wake of the Clinton health reform disasters and single-payer advocates.
For those of you not familiar with the Hacker Plan (available here), it basically consists of three key elements:
- Employer Pay-Or-Play Mandate – Employers are required either to provide health care for their employees or to pay a payroll tax that goes into a fund for covering the uninsured.
- Individual Mandate Plus Sliding Subsidy – Individuals not already covered by their employer would be required to purchase health insurance, either from a public or private insurer; income-based subsidies would ensure that the cost of insurance would be reasonable.
- A New Public Insurer – A new, Medicare-like public insurer would be created to act as a competitor/yardstick to private health insurers and to ensure that there is an “insurer of last resort.”
Single-payer advocates are upset that they are basically being shut out of the debate, and they have a right to be. However, I believe that a certain amount of the anger directed at advocates for “public option” reform is due to the fact that the Hacker Plan has become more or less consensus within a broad segment of the Democratic Party, from as far left as Ted Kennedy/EPI/labor to as far right as Max Baucus and Hillary Clinton, although there remains to be seen how extensive the Blue Dog/Evan Bayh contingent is, and how much they’re actually going to remain outside the consensus on this issue. This has meant that while the single-payer advocates have some base – especially with CTA/NNA (the nurses’ unions) and various health care grassroots groups (HCAN, etc.) – a lot of its natural supporters are now in the “public option” camp, which reduces the constituency for single-payer at the legislator and lobbyist levels. Even if single-payer was to “get a seat at the table,” they’d find that the other chairs – those not reserved for industry – are already taken up by “public option” advocates, and would find themselves on the losing side of a number of internal debates, and we’d probably end up exactly where we are today.
Like I said earlier, I feel very ambivalent about this, because I am ideologically and emotionally sympathetic to single-payer as a policy goal, but I feel really turned off when I see the tactics and strategies being carried out by single-payer advocates as they try to push their ideas back into the debate. For me, this isn’t a theoretical issue, it’s quite personal.
Humphrey Cooper Attewell, my great-grandfather. was elected to the British Parliament in 1945 as the Labor M.P for Harborough. As such, he cast his vote for the establishment of the National Health Service in 1946. The NHS was at the time and remains to this day the one of the most progressive health care systems in the world – a system in which the hospitals belong to the state, where the doctors, nursers, and other medical workers are public employees, and where health care is provided to all for free as a right. In a sense, therefore, the story of single-payer health care is the story of where I come from and who I am.
Yet I find myself oddly turned off when I listen to single-payer advocates, in part because I really disagree with the manner in which they are attempting to push their agenda, both in terms of their tactics and their larger strategy. I don’t find the tactics of single-payer advocates compelling in the slightest; I think direct actions and civil disobedience directed at the chairman of the committee who’s going to decide what health care bill will ever emerge on the floor of the Senate to be totally without merit. Simply put, it does not advance the cause of single-payer at all to piss off Senator Max Baucus, especially since single-payer advocates do not have the resources or the political strength necessary to seriously challenge him either in Montana or in the Senate Democratic Caucus. Strategically, I find the insistence on an all-or-nothing single-payer system to be utterly misguided and contrary to all the lessons that history can teach us about how advances in social policy actually happen.
Take a look at two of the most single-payer nations out there – Canada and the U.K. The Canadian health care system emerged, not in a single all-or-nothing burst, but rather in a gradual process of expansion. In 1944, Tommy Douglas of the CCF (Canada’s socialist part at the time) was elected premier of Saskatchewan on a platform that included free hospital care to all citizens. In 1946, his government passed the Saskatchewan Hospitalization Bill, which provided hospital care (not including physicians’ bills, prescriptions, etc.) to most, but not all residents. It took time to build up enough finances to cover all residents, and to extend coverage to all servcices; full Medicare for the province didn’t come in until 1959. Other provinces began experimenting with universal health coverage; Alberta establishing a pre-paid system that covered 90% of their residents in 1950. It took longer for the system to spread across the country: the first Hospital Insurance and Diagnostic Act in 1957 merely provided 50% of the costs of running health care programs; in 1962, the national government passed legislatuion to include phsyicians costs in the federal susbsidy; in 1966, the national government passed the Medical Care (Medicare) Act, which enabled provinces to establish full Medicare systems based ont he Saskatchewan model; and in 1984, the Canada Health Act established the modern system that Canadians know today.
In the U.K, the move towards single-payer began in 1911, with the introduction of the National Insurance Act by Lloyd George’s Liberal government. This legislation established a national system of health insurance, funded by payroll contributions from workers, employers, and contributions from general taxation – quite different than the current system. However, this system only covered certain trades and occupations of workers paid into the system, and the relatively low government contribution meant that coverage could often be quite expensive. During WWII, the pressures of the mass bombing of civilian populations led to the creation of the Emergency Health Service, which put all medical professionals into government service, created a coordinated national hospital system, and so forth. And finally in 1946, the new Labor government passed the National Health Services Act, establishing the modern National Health Service (NHS) on the basis of three central principles, that services should be free at the point of use, that general taxation should be the source of financing for the system, and that everyone would be eligible for care.
The point of this history lesson is that single-payer has historically developed in a gradual fashion – the Canadian system took forty years to develop into the modern Medicare system, and the British system took more than thirty years. In both cases, it wasn’t a single piece of legislation that made single-payer a reality, but the gradual achievement of partial steps that, like water dripping on a stone, wore down institutional resistance to single-payer.
Which leads us back to the current debate. I think that single-payer advocates should rethink their attachment to immediacy and to all-or-nothing when it comes to achieving their goal of a single-payer system; moreover, I think this will lead towards a re-evaluation of tactics, and the embrace of a strategy that emphasizes allying with public-option advocates to gain entrance into the coalition, so that they can begin pushing for those elements that would make the current proposal a true stepping-stone to single-payer. Here, I’m primarily thinking about ensuring the inclusion of a public option, making that public option as Medicare-like as possible, pushing for more generous income subsidies and more comprehensive minimum stnadards for healthcare plans, and support for states to experiment with single-payer. The passage of any major health care reform would in itself be a major step forward, in that it would break the now forty year gap in major social policy achievements, it would de-stabilize and de-motivate opponents ot health care reform, it would create a political atmosphere more open to single-payer by making universal health care a new “third rail,” and it would create pressures and interest groups to reform and improve and expand the new system.
Furthermore, in policy, passing the bill is only half the battle – implementation is the longer and more crucial phase. Here, I think one way that single-payer advocates can begin to broaden their base while pushing for their objectives is to begin a national campaign to sign people up for the public option, pushing the system closer to single-payer with every person signed up, and concretely solving the crisis of the uninsured. Here, single-payer advocates could usefully work with allies within the labor movement to push all 12.4% of the workforce that’s currently unionized into the public plan, and other social justice groups (union organizing campaigns, civil rights groups, GLBT groups, feminist groups) could plug into the campaign by folding signing people up for public health care as part of their ongoing missions. Moreover, single-payer advocates, by being slightly outside the coalition of public-option advocates, would then be free to begein “raiding” the private insurance market, taking the fight to the private insurance companies by mobilizing their friends, families, neighbors, and co-workers into switching from private to public insurance; you could target major employers with public insurance drives, especially focusing on corporations like GM, Ford, and Chrystler, where the argument for a single-payer (as opposed to employer-based) health care system might resonate.
In my mind, that’s the winning strategy for single-payer.
Thursday, May 21, 2009
Note: This is a cross-post from my new group blog, The Realignment Project.
One of the side-effects (collateral damage if you want to be ironic) of the 2008 election, and the broader public reaction against the Bush Administration, has been a massive shift in partisan identification away from the Republican Party and toward the Democratic Party.
One example of this trend is the most recent Pew Poll on partisan identification that shows a shift from a tie of 43% to 43% in 2002 to a 53% Democratic and 36% Republican split. This follows several other polls that suggest a massive decline in Republican identification and a smaller, but still significant increase in Democratic identification.
All of which has caused a bit of speculation over whether the Republican Party will survive as an institution, and what this will mean for the future of American politics. Will the Republican Party collapse, and what will fill its place? Will there be a new second party, and what will it look like? Will the Democratic Party become the lone major party, and how long would their sole dominance last?
For the purposes of a thought experiment, I’d like follow one particular line of speculation in order to tease out some major questions about the current nature and future direction of the Democratic Party.
One of the advantages of taking a historical approach to a question like this is that American history luckily gives us examples of how this kind of political realignment has happened in the past. Unusually, the United States seems to experience major political realignment on a fairly regular basis, so we have several models that could tell us what the collapse of a political party might look like:
Ultimately, I’m persuaded by polling data that shows a continuing trend of declining Republican identification, which suggests that the failures of the Bush Administration have not merely damaged the reputation of George W. Bush, but have also damaged the long-term reputation of the Republican Party as well. In addition to the partisan damage, I think economic conservatism has been badly damaged by the Bush recessions, and it will take some time before the public is willing to support more pro-market policies. Furthermore, I think that surveys of political ideology – as can be found here and here - suggest that the political environment is likely to shift leftwards for some time to come, making it more difficult to establish a new second party. This evidence is especially persuasive on social issues, suggesting that cultural conservatism may be in for a more long-lasting decline, as younger generations turn against cultural conservative issues across the political spectrum.
What I think will happen, therefore, is a period of Democratic Party dominance for the next 10 to 20 years. However, I think tensions will gradually emerge between its left and right flanks over economic and social policy that may very well lead to the establishment of two new parties. What we may have in 2040 is one party that is socially liberal and economically liberal – a genuine Progressive party, although probably partaking less of the class politics of a Social Democratic Party than the “social organism” politics of Progressivism – and another party that is socially liberal and economically laissez-faire – what Europeans would recognize as a Liberal Party. The reason for this is that as moderate and liberal Republicans desert the Republican Party for the Democrats, there will be a wider base for this kind of politics – at least after expansions of the welfare state (especially in the area of universal health care) and the return of economic prosperity have given middle class and affluent Democrats the sense of economic security necessary for the return to a more New Democratic attitude towards markets, especially given the availability of corporate financing for such a political shift.
However, it’s hard to tell what will happen. It may well be that the Republican Party will jettison cultural conservatism and become a European-style Liberal Party – if that does happen, I don’t think it will happen any time soon. At the very least I would think it would take a period of sustained losses in 2010, 2012, and probably 2014 and 2016 to really produce enough of a scare to make that happen. It would also be wrong to suggest that any of this could happen on its own – any political shifts we might see over the next 10 or 20 years will require huge amounts of political work. At the very least, we will need to see key policy victories in the Obama administration – with universal health care being the most important among them – in order to create the political climate for an enduring left shift.
Wednesday, May 20, 2009
Note: and that's the last of the re-posts. The context for this post was the political fight over the Obama stimulus package.
In the last few months, the U.S economy has seen one of the fastest slides into one of the most terrifying employment declines in American history - we are now losing jobs at the rate of 500,000 a month.
Given this reality, the current stimulus proposal is no longer sufficient. We must move beyond a debate that tries to balance a couple hundred billion in tax cuts with four hundred billion in public works, aid to the states, and traditional stabilizers (UI, food stamps, etc).
In the last few months, the U.S economy has seen one of the fastest slides into one of the most terrifying employment declines in American history - we are now losing jobs at the rate of 500,000 a month. Given this reality, the current stimulus proposal is no longer sufficient. We must move beyond a debate that tries to balance a couple hundred billion in tax cuts with four hundred billion in public works, aid to the states, and traditional stabilizers (UI, food stamps, etc).
What we need are jobs, and jobs now.
For about two years now, I've been diarying about public employment programs, which I'm studying for a dissertation in U.S Public Policy History. If you're interested in reading more on job creation programs, you can check out any of these diaries:
[edit: see here]
The Current Crisis:
Given the stunning rate of job loss, I believe that traditional stimulus measures will not be adequate to offset the damage being done to the economy. On the jobs front, if we create three million jobs as President-Elect Obama hopes, we may well have only bought ourselves six months of breathing room rather than a lasting improvement. On the consumption side, even if we shovel $1 trillion into the economy, if people are seeing jobs disappear at the rate that they have, their propensity to consume will decrease and their propensity to save will increase as people batten down the hatches against the bad times and save money for when the jobs go. Not to say that it won't have any effect, but it's going to be much much weaker than one would hope.
Given the seriousness of this situation, I think we need to radically re-think the stimulus package. To begin with, the tax cuts need to come out - they're not going to have nearly enough of an effect on people's spending habits if people's psychological posture is determined by an omnipresent fear of layoffs and unemployment. Next, we need to understand that the current commitment to public works is inadequate to the task. While many of the existing public works plans - from greening buildings to building high-speed rail - are quite worthy, the nature of the process of letting out contracts, vetting proposals, and getting the site operational takes too damn long, and will not generate enough jobs fast enough.
What We Need:
As I have argued before (see here), public works are not the policy tool we should be looking to, at least not in the traditional contractor model.
Instead, I believe that the Federal government needs to hire unemployed workers directly and immediately. We should begin by hiring 5.5 million workers right now, to bring the unemployment rate down from 7.2% to 3.6%, and to increase that number at any time to keep the overall unemployment rate at 4% or below if/when additional private sector jobs are lost.
Why? First, we need to dramatically reverse our current downtrend. Creating these jobs would send a dramatic signal to every consumer and producer that mass unemployment is not going to happen, that it is not necessary to cut back in the face of crisis. Second, we need a policy big enough for our economy. Given the sheer scale of the American labor market, in order to send a signal that really resonates, you need to do something at a large enough level that it actually changes the economic reality - cutting unemployment in half is exactly the right kind of signal. Third, every month we wait to create jobs is less income going into the economy and more people falling into poverty - in order to start spending fast enough to get ahead of the deflationary effects of this recession, we need to create jobs faster.
Luckily, we do have precedent for how to do this, in the Civil Works Administration. In the fall of 1933, with unemployment still hovering in the 20% range, Harry Hopkins (the head of FDR's Federal Emergency Relief Administration) went to President Roosevelt with a plan to create 4 million jobs to reduce unemployment and keep people alive during the normal seasonal downturn in unemployment in the winter. To his surprise, Roosevelt agreed, and the CWA was born in October 1933, with a grant of $400 million dollars "borrowed" from FDR's public works program.
In three months, the CWA had created 4.26 million jobs. At a time when the most advanced administrative technology was the carbon copy and the rotary phone, all 4.26 million workers were hired and put to work that quickly. Surely, today we can do better.
Assuming a base salary of $24k/year and a non-salary overhead of 30% (a rather generous assumption, given that New Deal era programs managed to limit non-salary costs to 20%), it should cost roughly $31 billion to put one million people to work for a year. Five and a half million people makes $170.5 billion dollars - well within the current framework of President Elect Obama's $750 billion plus package.
In the end, this is not a question of whether we can find $170 billion to spend; the sheer size of the bailouts and the proposed stimulus package shows that the American government's fiscal powers are much greater than we've been led to believe on social welfare issues. It's more a question of how we spend money, and the ideology contained therein.
Republicans want to give tax breaks because they don't believe in government, and they want to benefit the rich who they believe are best suited to spend the money. Congressional Democrats want to spend the money traditionally, because they're used to spending on traditional areas and constituents (not that their proposed spendings are a bad idea, far from it), and because it's been 70 years since we've done anything like this. Creating millions of jobs directly is a radical departure from standard practice, and Democrats may well be nervous about doing something so drastic.
However, we simply cannot afford to wait.
Please read this, promote this if you can, pass the word on. There is a way out of this crisis, but we just have to remember how we did it last time.
Tuesday, May 19, 2009
Given that the current ballot propositions have gone down in flames, then the state of California faces a brand-new budget crisis of some $21.3 billion. While obviously the Democratic leadership has focused their attention on trying to pass the ballot measures they thought represented the best possible compromise, I do hope that some thought has been given to what the new strategy will be on 5/20. Granted, the imperatives of political strategy mean that it's more than likely that there is a Plan B that's being kept under wraps at the Legislature, At the same time, however, it is vital that California Progressives come together to construct a stronger coalition and a winning strategy for the future of our state.
One potentially hopeful sign is that it appears that California may seek some sort of Federal bailout, either in the form of Federal fiscal aid or in Federal guarantees for California's bonds. The danger that progressives have pointed to is the possibility that Gov. Schwarzenegger will use this crisis to push for additional spending cuts, deregulation of environmental and labor protections, and other regressive pet projects.
Obviously, this would be catastrophic, both for California and for the nation. The Obama Administration must resist the Governor's request for "the right to make the cuts we need" - if for no other reason than pure self-interest. There is nothing to be gained from placating a Governor who has no political future in his or any other party, whose approval ratings are through the floor, whose administration has become a byword for failure, and who has nothing to offer the administration. Obama's political and policy interests converge in a successful economic recovery achieved through Keynesian stimulus; his interests in a California bailout would be to ensure that the Largest state in the Union and the world's 10th largest economy does not become a massive deflationary weight on the American economy. Acceding to further spending cuts, further job losses and furloughs, and especially to programs like Medi-Cal that benefit the poorest Californians (who as Keynesian theory reminds us have the greatest "marginal propensity to consume") would only serve to damage his own stimulus plan and slow the pace of recovery.
California Progressives at every level, from Senator Boxer on down to the Party Central Committees, local grassroots groups, and veterans of his 2008 campaign should absolutely lobby the President to ensure that any bailout is conditional on A. a reversal of prior cuts and firings and a commitment to pro-stimulatory policy, and B. Schwarzenegger's commitment to signing a new majority-vote budget written up solely by Democrats using the "Steinberg maneuver."
However, even this victory would be a mere cauterizing of the wound. If nothing else, the defeat of the May 19th propositions must show all members of the Progressive coalition that we cannot continue on the current path of division and drift - we must unify around a comprehensive strategy for confronting the crisis of governance once and for all in 2010, a new way forward.
To begin this process, we should start with a few fundamental strategic principles:
1. Aggressive Partisan Use of Majority-Vote
Progressives tried and failed to abolish the 2/3rds rule before. While we must absolutely put every resource we can into its abolition in 2010 (including putting abolition front-and-center in the 2010 Democratic Platform, making it a litmus test in the gubernatorial primary, and creating a narrative of constitutional reconstruction around it), our commitment to functioning democratic government must come first. Which means no matter what happens in the future - whether we pass an initiative or don't, whether we get to 2/3rds control of the legislature or don't, whether we get control of the governor's mansion or don't - that Democrats aggressively use the "Steinberg maneuver" to right the fiscal ship and get California voters accustomed to seeing majority budgets. This may very well mean strong-arming the governor, and potentially using our allies in the Federal government to provide additional leverage, but I see this as a crisis of democracy. Either the people rule in the state of California, or they don't, and we cannot allow a minority bent on the bankruptcy of the government to succeed.
At the very least, let's try - even failure would be better than doing nothing.
2. Creating a Progressive Foundation For the State's Finances
There's been a tendency in recent years for Democrats in the state legislature to nibble around the edges when it comes to raising revenue rather than going for comprehensive solutions. We can't afford to delay any longer. Democrats need to think more creatively about revenue generation, and about how to create progressive narratives around revenue and spending - even if it means going after corporate taxation and tax breaks in a major way. A good first step would be something like establishing an oil excise tax and putting the revenue into a higher education fund (simultanteously opening up more space in the General Fund) - thereby tying a tax on companies people don't like to a cause that people do like. Similarly, I think tying a cut in residential property tax rates to an increase in commercial property tax rates - and tying that revenue towards California's various green-housing ventures would also create a positive narrative that frames progressivization of the tax code in a personal and approachable way - do you favor cutting your taxes and raising more money for green housing, or protecting rich corporations?
Above all, we cannot let the debate over government taxing and spending be conducted at an abstract level that allows conservatives to milk voters' mixed feelings of resentment of taxes and apathy towards paying for services they want. At all times, the means (taxes on X) must be connected visibly to the end (spending on this program). We must learn to do that, not just for budgeting-by-ballot initiatives, but for the entire General Fund.
3. A Universal and Comprehensive Approach to Social Spending
Which brings me on to our next issue - the tangled nature of our state's social spending, a mixture of regular General Fund spending and special initiative funds. It's incredibly opaque, and makes it very difficult to understand what's going on, plan or coordinate, or to mobilize people around an ultimate goal for social spending. My current vision is that we should create unified social Services to centralize our competing and divided programs, and to create the administrative capacity for future progressive efforts. For example, a California Health Service to combine Medi-Cal, Prop 10's funds, and other programs, not only to improve coordination of current efforts, but also to create the state capacity for single-payer health care in the future. (After all, the British NHS required the prior establishment of the war-time Health Services who developed the expertise in nation-wide public health delivery). Moreover, a Health Service would allow taxation to be linked closely to spending, which would in turn be linked to public policy goals: "support bill/proposition X to increase revenue for the Health Service, to help move California towards universal health care," or "support bill/proposition Y to increase revenue for the Education Service, to reduce drop-out rates in half in five years."
Thus, the narrative of government is complete, from the tax, to the program, to the program's intended results. That way, debates over government shift from the conservatives' favorite territory of how big or how small or how efficient or wasteful to questions of which social goals we want to achieve.
4. A Unified, Party-Driven 2010 Campaign
In order to achieve all of this, we need to avoid the kind of factionalized intrigue and infighting that has sapped and dispersed the strength of the California Progressive movement - this means getting every group on board, including all of organized labor, all of the Latino groups, all of the African-American groups, all of the Asian-American groups, all of the progressive groups, all of the women's groups, all of the GLBT groups, and all of the electeds in the same coalition.
And just as importantly, it has to be centralized within the party. Every election cycle, we run into the same program of groups trying to re-invent the wheel by forming new coalitions, building up their own voter and donor databasers, running their own ads, doing their own GOTV. It's a massively wasteful duplication of effort, and it often means that politics becomes less democratic, as power is pushed upwards into the executive boards of temporary organizations that are unelected and not responsible to their constituency; it also means that official Democratic Party politics is diminished by the inattention of the progressive forces within the party, leading to capture by electeds and candidates and the devolution of what should be principle and policy-based politics into personality-driven politics. Hence the need for all groups to stake a common claim to a party organization that is, for all of its faults, visible, elected, and responsible to local Democrats.
This is not an easy thing to ask - it means giving up autonomy in favor of collaboration and compromise; it also means a genuine embrace of solidarity. Solidarity is a word that gets tossed around a lot in labor circles, sometimes genuinely, sometimes as a genuflection to a timeworn idol, and sometimes as cover for more complex politics. It's also something so deep in the bones and blood of the labor movement that it becomes almost an inexplicable article of faith - a shibboleth that separates those of the House of Labor from our uncomprehending allies. But what it ultimately means is a commitment to an other-directed politics, to the recognition of a wider moral commonwealth, an almost-spiritual oneness of need and humanity and frailty between disparate and remote groups of workers. It means being willing to march in a picket line and get your head beaten on for a different union's drive, for workers you may never have met before - because you recognize your struggle in theirs, and know implicitly that they'd do the same for you. It means refusing to cross a picket line even when it might hurt your pocketbook because crossing that picket line would be a betrayal of that part of yourself you see in other people.
It's a tough concept to live up to, a sort of discipline. And it's something that various factions of the Democratic Party need to understand and make a part of your life. It meets that Progressives - who are often whiter, richer, and maler than other members of our coalition - have to instinctively recoil from anyone who calls labor a special interest, because labor would do the same for them when conservatives attack them as anti-American. It means that African-American groups need to instinctively support GLBT groups on issues like Prop 8, not because the African-American community is morally obliged to be the conscience of the nation, or because they're required to accept any group's claim to similarity to the civil rights movement, but because they recognize GLBT Californians as part of a coalition for a broader conception of civil rights for all. And on and on, each group must be willing to put the interests of their peers at a level with their own, and the interests of the coalition above all else.
And this won't happen unless the center of a unified, party-driven campaign is a progressive platform that fully incorporates the major drivers of all constitutive elements of the party. That means not just Abolition of 2/3rrds, but also Repeal of Prop 8, and so on, so that each group feels that its political objectives can best be met by the enactment of the party platform, creating the level of trust and confidence necessary for concerted action and true solidarity.