Claire Moser — Election Divides GOP On Whether To Seize And Sell America’s Public Lands

In the run-up to Tuesday’s elections, each week seemed to bring a new Republican candidate for federal and state office advocating for America’s national forests, wildlife areas and other public lands to be seized by the states or auctioned off to the highest bidder. Even the Republican National Committee (RNC) passed aresolution endorsing these extreme proposals earlier this year. 

Not all western state Republicans stood by their party’s platform in this election cycle, however. High-profile candidates who won competitive races in the West deliberately distanced themselves from their party’s platform, or avoided taking a stance on the issue altogether during their campaigns. At the same time, a number of western Republicans in competitive races who chose to embrace their party’s extreme stance came up short on Election Night.

Land grabs are also deeply unpopular among voters. Recent public opinion research, conducted by a bipartisan polling team, found that the majority of Western voters firmly oppose proposals to transfer America’s national forests and public lands to state ownership.

One winning candidate who backed away from his initial stance on seizing and selling off public lands was Montana Congressional candidate Ryan Zinke (R). Zinke, who had been an outspoken supporter of Wisconsin Rep. Paul Ryan’s proposed budget, which would have required the sale of public lands to reduce the deficit, was forced to revise his position after his Democratic opponent ran a popular ad criticizing his stance. 

The ad, set to the tune of Woody Guthrie’s famous “This Land is Your Land,” elevated the issue to a centraldebate on the campaign. Zinke then clarified that “he supports the ‘framework of the Ryan Budget,’ but opposes selling off public land,” as the Great Falls Tribune reported.…

Privatization of the commons, primitive accumulation, enclosure, the whole neoliberal catastrophe.

For the Republican Party, the growing internal debate over whether America’s public lands should be seized and sold represents a choice between the conservation values of Republican President Theodore Roosevelt and the power of a special interest-driven agenda.

Think Progress
Election Divides GOP On Whether To Seize And Sell America’s Public Lands
Claire Moser

David Dayen — GOP hypocrites neglect poor — while drafting secret pro-military loophole

No surprise here.

With one relatively insignificant clause buried on Page 364 of a massive budget bill thatwill get voted on today, Congress told us everything we need to know about federal spending priorities, the empty rhetoric of “budget discipline” and the power of the military-industrial complex. We learned that Congress can’t fund anything — like food stamps or unemployment insurance — without a spending cut to offset it … unless the item in question has something to do with the military.

Salon
GOP hypocrites neglect poor — while drafting secret pro-military loopholeDavid Dayen

Mark Thoma — Democrats Will Have to Swallow Entitlement Cuts?

I honestly can't remember if I voted for Obama or Hillary in the primary, but if I voted for Obama, it was a mistake.

Economist's View

Democrats Will Have to Swallow Entitlement Cuts?
Mark Thoma | Professor of Economics, University of Oregon

Get ready for the sh*t storm. Any Democrat who votes for this will face a primary challenge from the new wave, and this issue will be chief focus of the presidential campaign in 2016. 

Democrats must realize that this is a GOP trap that Ryan is setting for them. Voting for entitlements cuts as a Democratic proposal in exchange for anything just hands the GOP a club to beat the Democrats with.

Social Security and Medicare still constitute the third rail of American politics. It's the GOP that wants to cut them while making the Democrats grab the third rail with both hands while standing in a puddle. What's not to like about that for the GOP and what's to like about it for the Democrats, other than to fund Obama's library and lucrative speaking tours upon his retirement, leaving the rest of the party holding the bag. Craven. And who does Gene Sperling represent and really work for? Wall Street, of course.

Dave Johnson — Republicans Demand Social Security And Medicare Cuts, Is It Reported?

Republicans are demanding cuts in Social Security and Medicare if Democrats want to change the terms of the “sequester.” I’m sure their Tea Party “base” would be shocked if they understood this. So would most Americans. So is the media giving Americans the information they need in order to make informed decisions?

Yesterday The Hill reported, in “House GOP says sequester is leverage in next budget battle,” that House Budget Committee chairman Rep. Paul Ryan is pushing for cuts in Social Security and Medicare:

In a meeting with House conservatives, Rep. Paul Ryan (R-Wis.), told rank-and-file lawmakers that, as the party’s chief budget negotiator, he would push instead [of killing Obamacare] for long-term reforms to entitlement programs in exchange for changes to sequestration spending cuts that Democrats are expected to demand.

[. . .] Rep. Matt Salmon (R-Ariz.) said that during the GOP meeting, Ryan pointed to sequestration as the party’s leverage with Democrats and said the Republican negotiators would not accept revenue increases in exchange.

“We’re going to try to push for some substantial reforms on entitlement spending and our backstop is sequestration,” Salmon said in describing Ryan’s remarks....

To many in the voting public the word “entitlements” does not translate to “Social Security and Medicare.” Ryan and the Republicans understand this. This is why they talk about “reforming” something that is not clearly understood as Social Security and Medicare.

So again, have any major news outlets explained to the public, using words that the public understands, that the Republican position in the current budget negotiations is a demand to cut Social Security and Medicare?

  Campaign for America's Future

Republicans Demand Social Security And Medicare Cuts, Is It Reported?
Dave Johnson

The obvious Democratic response is to accuse the GOP of attacking Social Security. Doh.

Stephen Rosenfeld — Sell-Out Alert: 9 Democrats Already Caving to GOP On Social Security Cuts

Illinois’ Dick Durban, Washington’s Patty Murray Virginias Sen. Mark Warner, California’s Dianne Feinstein, Montana’s Max Baucus, West Virginia’s Joe Manchin, Delaware’s Chris Coons and Tom Carper, and Colorado’s Michael Bennett have all said either that they support cuts to entitlements in letters to constituents, or have put "everything" on the table for negotiation — and this is for starters.

But the biggest Democrat of all—and the one not drawing a line in the sand but possibly leading a historic sellout—is President Obama. In September 2008, when the senator from Illinois appeared before the AARP, Obama attackedRepublican nominee John McCain for suggested cuts to Social Security. As President, he has embraced those kind of cuts.

Alternet
Sell-Out Alert: 9 Democrats Already Caving to GOP On Social Security Cuts
Stephen Rosenfeld

All the spin is wrong: The GOP shutdown was about more than tactics

The GOP's desperate to spin their shutdown in order to camouflage very real divisions. They do have one way out

Salon
All the spin is wrong: The GOP shutdown was about more than tactics

Brian Beutler

I would put it somewhat differently. The GOP's aim is to preserve Norquistism and get the Democrates to agree to cut Social Security. First, Norquistism is an iron clad rule since Poppy Bush broke his "Read my lips. No new taxes pledge." 

Secondly, the primary aim of the GOP is to end the welfare state created by New Deal, which means ultimately privatizing Social Security. They know that Social Security is very popular, especially with their older base. They cannot cut Social Security or Medicare alone, and they need Democratic leadership to do it.

Many Democrats realize that this is a trap and than if they agree to cut Social Security, especially if they propose the cuts as part of a Grand Bargain, then they will be beat over the head with it in coming elections.

The problem is that the Democratic Establishment is also aligned with the forces lobbying for entitlement cuts, that is, the wealthy donor who see the welfare state as increasing their taxes.

In addition, first Bill Clinton and now Barack Obama regards it as a matter of establishing presidential legacy as a Very Serious Person who dared to confront difficult political problems.

This may look like a Republican problem but it is a much more serious Democratic problem that could refashion the party in the future away from the Democratic Establishment. Which would be a good thing, but not at the expense of cutting Social Security and Medicare and "fixing the debt." 

The economic fallout would be horrendous if the government contribution is pared substantially. The GOP Establishment knows that and would try to increase military spending to offset the cuts in social programs, were this to happen.

Brett Logiurato — Paul Ryan Writes An Op-Ed On 'Ending The Stalemate' In Congress, And It Doesn't Once Mention Obamacare

Rep. Paul Ryan has a must-read op-ed in the Wall Street Journal tonight on ending the fiscal impasse in Washington.

It's perhaps more notable for what it doesn't once mention — Obamacare — as what it eventually proposes. That omission seemed to ignite the ire of conservatives Tuesday night. 

The key proposition in Ryan's op-ed, though, is a trade of entitlement reform for repeal of the sequester cuts. 

From the op-ed:

"For my Democratic colleagues, the discretionary spending levels in the Budget Control Act are a major concern. And the truth is, there's a better way to cut spending. We could provide relief from the discretionary spending levels in the Budget Control Act in exchange for structural reforms to entitlement programs."

Ryan also proposes a few ideas for entitlement reform — making wealthier Americans pay higher premiums for Medicare, reforming "Medigap" (Medicare supplement) plans to "encourage efficiency" and reduce costs, and asking federal employees to contribute more to their own retirement.

Ryan's entry into the current debate is significant — until now, the former Republican vice presidential nominee had been almost entirely silent....

Because of that clear omission, Ryan's op-ed was immediately slammed by conservative groups that have led the "defund" charge. 

Business Insider

Paul Ryan Writes An Op-Ed On 'Ending The Stalemate' In Congress, And It Doesn't Once Mention Obamacare

Brett Logiurato

Uh oh. Look out. Here's comes the Grand Bargain.

Derek Thompson — The GOP Might Lose the Shutdown Battle, but It's Already Won the Spending War

Don't say Democrats aren't compromising. Their bill last night (rejected by the House GOP) would have funded government at Paul Ryan-levels.

The Atlantic Business
The GOP Might Lose the Shutdown Battle, but It's Already Won the Spending War
Derek Thompson | Senior Editor

Warren Mosler — Comments on the Current U.S. Budget Debate (1996)

The assumptions underlying the current budget debate are erroneous. Historical analogies include “the earth is flat” and “the earth is the center of the solar system.” Chicken Little has returned, and the consequences are counter agenda for all parties.

The noble attempt by Congress to balance the budget will result in a weaker economy with a true depression a possibility. Every time there is a drop in the budget deficit, as a percent of GDP, the GDP growth rate drops a few quarters later. It is only after the deficit begins to expand again that the economy recovers. The historical correlation is 100%. Lowering interest rates, in an attempt to boost the economy, is seldom effective. Since the government is a net payer of interest, lower rates reduce spending, thereby increasing fiscal drag.

Governments are monopoly issuers of fiat currency. The incorrect , but prevalent, understanding is that issuers of fiat currency must tax, borrow, or otherwise raise revenue so they can spend it. Taxing and borrowing are considered “funding” operations. Consequently, the discussions revolve around how governments can raise “needed revenue” to fund spending. Revenue shortfalls are of great concern; witness the latest government shutdown.

Contrary to general perception, fiat money is driven by the fact that taxpayers need the government’s money to pay their taxes. By levying a tax, the government creates a need for its fiat currency. It creates this need, presumably, so it can obtain the real goods and services it desires via the spending of its currency.

From inception, the only source of money needed to pay taxes is the issuing government. The government cannot actually collect the tax it has levied, nor borrow any of its fiat currency, until it first spends, or otherwise provides, the funds.

A balanced budget, from inception, is therefore the theoretical minimum that a government can spend. The previous statement represents an accounting identity. If individuals and businesses desire to hold actual cash, that money must be “left over” after taxes are paid. All cash held by the public must be money provided by the government in excess of the need to pay taxes (deficit spending). This is also true for all dollars held by foreign central banks at the Fed. For these, and other structural reasons, the possibility of a balanced budget does not exist, and the current attempt to balance the budget will likely result in severe deflation. When the government does not spend enough to cover the total need for dollars created by taxes, the usual result is a recession and a concurrent shortfall in revenues. A deficit remains. Accounting identities have a way of being satisfied, one way or another.

Likewise, the government can borrow its currency only after it has provided it to the private sector. Government borrowing, therefore, functions to support interest rates, not as a funding operation. Nominal savings is not diminished, nor displaced - it is given a place to earn interest. If the government were to spend more than it subsequently collected in taxes, and did not offer securities for sale, the fed fund rate would immediately fall to 0% bid. Treasury spending is a reserve add. Selling securities, by the Fed or Treasury, is simply a reserve drain, a monetary operation. This underlies the empirical evidence that nations can run any debt ratios they want, in their own fiat currencies, and still “fund the debt.”

For all practical purposes, there is no such thing as a balanced budget. Singapore, for example, shows a budget surplus, but that does not include all government spending in excess of collected taxes. The central bank spends Singapore dollars to buy foreign currencies. This “off balance sheet” spending brings the consolidated spending to about 2% higher than collected taxes. The same happens in Czechoslovakia - fiscal policy is tight enough that the only way to get enough local currency to pay taxes is selling foreign currencies to the central bank. When the central bank makes the taxpayers “beg”, as evidenced by currency appreciation, the economy gets softer (Japan is another good example).

Consider inflation. Because the taxpayers need the government’s money, the government is able to define its currency by what it pays for goods and services. By changing what it pays, the government redefines its currency. Currently, the government fights inflation by maintaining an economy weak enough for the private sector to be under pressure to sell goods and services. This selling pressure keeps prices from rising.

How large a deficit is prudent? Let the market decide! This option has not even been considered. For example, the government could offer a job to anyone who wanted one, at some minimum rate of pay deemed appropriate, and let the deficit float. This would end unemployment and unemployment compensation, eliminate the need for minimum wage laws, and promote price stability. Employment (rather than unemployment) would define the currency and become the stabilizer. The price of labor would be stable. Private sector wages would be related to the benchmark of government employment. If the government labor force were larger than needed by the government, taxes could be lowered. This would result in fewer government workers and reduced government spending as the private sector hired these workers.

The Fed sets short term rates. Congress has ultimate control over the Fed. Short term rates go up because the Fed, and ultimately Congress, wants them to - not because of market forces. These rates are not determined by market forces. Treasury securities are not necessary unless the government wishes to support higher long term rates. Short term rates could be maintained simply by paying interest on excess reserves held at the Fed.

The Federal debt is all the money spent but not taxed. It was borrowed after it was spent, so the holders of the money might earn interest. The government pays interest, voluntarily, depending on how much it wants savers to be able to earn. Have you ever heard an owner of government securities say, “I wish the government would stop selling securities so I can get my money back!”?

The current budget debate is based on erroneous assumptions. Washington does not understand fiat money. Until it does, efforts to reduce the deficit will continue, and the economy will continue to underperform.

EPIC | A Coalition of Economic Policy Institutions
Comments on the Current U.S. Budget Debate
Warren B. Mosler
 January 1996
(h/t Charles Hayden of MMT DALLAS DEFICIT OWL COMMITTEE, via Facebook)

Right sixteen years ago, and right now.

Richard Reeves — Stockman Redux

As he became president in 1981, Ronald Reagan called in a 34-year-old congressman from Michigan named David Stockman, considered by many to be the most articulate and intellectually imposing Republican of the moment.

Stockman had impressed the new president by humbling the old man in practice debates before Reagan took on President Carter back in September.

“Dave,” said Reagan, “I’ve been thinking about how to get even with you for that thrashing you gave me in the debate rehearsals. So I’m sending you to the OMB (Office of Management and Budget).” Commented David Brinkley of NBC News: “He’s so fast with big figures that he scares old Washington hands.”

Stockman had only days to come up with a balanced budget that fulfilled Reagan’s campaign promises to cut taxes and build up the military. He was fast, but not necessarily accurate or truthful. Not by a long shot. What he did was use a pre-Reagan-projected budget with a $75 billion deficit the first year. But he already knew the real figure would be more than $600 billion after totaling Reagan’s new programs. On the revenue side, he used asterisks instead numbers. Lots of asterisks.

Stockman retired after four years, wrote a book, a confessional of sorts, went to Wall Street and made a lot of money. He turned down interview requests and kind of faded away.

Until last week, when he wrote an opinion piece for The New York Times. The headline was: “Paul Ryan’s Fairy-Tale Budget Plan.”

truthdig
Stockman Redux
Richard Reeves

As they say, "it takes one to know one.

Martin Wolf — Paul Ryan’s plan for America is not credible

...If you believe that is likely, I have a bridge to sell you.Over the next decade, the Ryan plan is inadequate and incomplete. Over the long run, it is incredible. It may be good politics. It is bad policy.

The Financial Times | Columnists
Paul Ryan’s plan for America is not credible
Martin Wolf
(h/t Mark Thoma)

Warren Mosler — Is the Ryan Budget the Next Bachmann Budget?

I already posted a link to this at Warren's, but for the record here is at The Huffington Post.

The Huffington Post
Is the Ryan Budget the Next Bachmann Budget?
Warren Mosler | Fixed income fund manager specializing in monetary policy; Founder, MMT

David Stockman disses the Ryan budget

In an op-ed piece for the New York Times Monday, David Stockman, who served as the Office of Budget and Management’s director under Ronald Reagan, slammed the vice-presidential candidate’s financial plan for lacking decisive policy measures.

“The Ryan Plan boils down to a fetish for cutting the top marginal income-tax rate for ‘job creators’ — i.e. the superwealthy — to 25 percent and paying for it with an as-yet-undisclosed plan to broaden the tax base,” Stockman wrote. “Of the $1 trillion in so-called tax expenditures that the plan would attack, the vast majority would come from slashing popular tax breaks for employer-provided health insurance, mortgage interest, 401(k) accounts, state and local taxes, charitable giving and the like, not to mention low rates on capital gains and dividends. The crony capitalists of K Street already own more than enough Republican votes to stop that train before it leaves the station.”

Raw Story
Reagan budget director attacks Paul Ryan’s economic policies
Arturo Garcia

Sam Stein — Mitt Romney: Paul Ryan Budget Is Not His, Candidate 'Putting Together His Own'

Within minutes of tapping Paul Ryan as his vice presidential nominee, presumptive Republican nominee Mitt Romney was distancing himself from the congressman's controversial budget, which includes steep cuts to government programs and changing Medicare into a voucher-like program.

The Romney campaign sent out talking points on Saturday that made the case that he was his own man on matters of Medicare and Social Security and that he wouldn't be tied to a document he insisted he'd sign into law and once called "marvelous."

The Huffington Post
Mitt Romney: Paul Ryan Budget Is Not His, Candidate 'Putting Together His Own'
Sam Stein

Most popular Twitter comment: Romney Ryan have best hair. Maybe voters won't notice the Ryan Plan for them.

Ryan Lizza — How Paul Ryan captured the G.O.P.

Interesting in-depth article about Paul Ryan, the Ryan Plan, and the future of the GOP.

The New Yorker
How Paul Ryan captured the G.O.P.
by Ryan Lizza