economic policy

Tim Phillips, President of Americans for Prosperity and Senator Jim Demint (R-SC) gave a great conference call Town Hall meeting last night.  Approximately 11,000 concerned Americans called in.  Both Mr. Phillips and Senator Demint gave short introductions, and then took questions from the callers.  Senator Demint answered the questions while running back into the Senate chamber every so often to vote, or introduce an amendment to strip the pork out.  This was an amazing, and encouraging example of fiscal conservative activism, and an inspiring leader.

Senator Demint made it clear that his first goal was to defeat the legislation.  However, realizing that with the help of some shaky Republicans like Senator Snowe from Maine, the legislation may pass.  Consequently, he is doing everything he can to minimize the damage that will be done by this bill.  When a caller asked the Senator if the economy was as bad as the news made it out to be, and did we really need a stimulus, he replied clearly that it would be better to do nothing than pass this bill.   This bill will add $10,000 of new debt to every family in America.  We just can't afford that.

You can learn more about the bill at http://nostimulus.com   While you are there, please sign the petition expressing your opposition to this bill.  This petition will be delivered to the floor of the Senate before the vote, which is expected Friday.  There are also buttons there for you to call media, and email elected officials.  Make no mistake, as Americans learn more about this plan, the support drops every day.  One recent poll has it at 30%.  Senators up for re-election may choke and not vote for this if we can show enough opposition.

You can also go to http://www.jimdemint.com and express support for a jobs plan that ensures that businesses will be profitable, and therefore hiring... and ensures that people will spend... all by reducing taxes and leaving the money where it will do the most good.  After all, it doesn't cost anything to not take money.

Did you know that we have achieved a level of indebtedness that makes China think twice before lending us money?  They are losing confidence in our ability to pay our debts.  What if this spending package doesn't work?  At some point, the tap gets turned off.  We need real solutions that rely on creativity and free enterprise that are sustainable and permanent.  Our current level of debt is so high that if we were to apply to the European Union for membership, we would be denied as a debtor nation.  They have standards.  I'm embarrassed.

Americans for Prosperity and Senator Demint are doing everything that I hoped a Republican grassroots coalition would do.  Let's make it work.  Please commit a little time to do the following.  It's important, and just might make the difference.

1 - Go to http://nostimulus.com and at least sign the petition.  If you have time, use the tools there to send an email to an elected official.  We don’t have time for letters to the editor, we need fast impact.

2 - This one is critical.  Call 202-224-3121.  When the Capitol switchboard answers, ask for your Senator.  Tell them that you want them to vote against this spending plan.  If you have time, call someone else's Senator as well.

3 - Ask someone else to make the same call.

4 - Go to http://www.jimdemint.com and give him a quick thank you for his efforts.  Check out his one page, zero cost stimulus package:

http://demint.senate.gov/public/_files/2009-02-02_DeMint_Jobs_Plan_Summa...

Please, make the phone call in item 3.  If we can jam the switchboard, the main stream media, heck even MSNBC will report it and then maybe they'll blink, and not pass the package.  Call 202-224-3121, ask for the Senator of your choice, and express your outrage.

Tonight was a very good night to be a Conservative activist.

Steve

Send this to everyone you can.

Steve Smith, nhrepublican@gmail.com , 603-826-5996 

While I'm still skeptical of any large strategic effect the #dontGo movement had, the energy issue overall, as well as McCain's selection of Gov. Sarah Palin, has spurred new policy messages on a wide range of economic, middle class issues. Two days ago, Congressman Eric Cantor (R-VA 7th District) spoke to the Conservative Bloggers' Briefing at the Heritage Foundation, introducing a "Middle Class Bill of Rights." The components are:

• Energy: As everybody knows by now, the rational approach is to have an "all of the above" strategy which includes production of non-renewable and renewable resources (including nuclear), as well as initiatives that increase conservation and efficiency. Cantor mentioned that the selection of Palin gives the GOP in the expertise edge of energy solutions.
• Health Care: Cantor explained that individuals worry more today than a generation ago about losing their jobs because of the subsequent loss in health care coverage. Consumer-based health care programs and the expansion of Health Savings Accounts (HSAs) are the way to proceed.
• Making Paychecks Go Further: Another way of saying "tax cuts." But Cantor also mentioned that French President Nicolas Sarkozy is proposing making overtime wages tax-exempt to fuel more productivity at the micro-level.
• Job Creation: Cantor correctly points out that the best stimulus for any economy is job creation. This means Congress has to start being concerned about competitiveness and corporate taxes. Back in January, Cantor introduced the "Middle Class Job Protection Act," which would, among other things, cut the corporate tax rate from 35% to 25%. While it is speculative to link corporate taxes to job loss/creation, the ultimate burden of corporate taxes does fall on individuals through lower wages, higher costs at goods and services, etc. (The Tax Foundation has started a campaign called CompeteUSA, showing that corporate taxes in America are increasingly out-of-line with the rest of the world.)

While I like the combination of issues and the focus on the middle class, I'm not so sure I like the branding. Middle Class Bill of Rights? I've never been a fan of economic "rights." But maybe it is this type of messaging that the Right needs for this and future elections cycles in order to successfully court the middle class. And now that McCain and Republicans are making headway on economic and energy issues, as Sean points out, Cantor is definitely headed in the right direction.

John McCain looks like he's closing the gap, or even taking the lead, in some national polls. RealClearPolitics now gives him a 274 to 264 edge in the electoral college without toss-up states. There are plenty of explanations for this, and they all might be valid: McCain starting to hit Obama hard, Obama's failure to come up with a coherent strategy in the midst of great tactics (something Soren points out), etc.

One of the new theories is Obama's failure to sell his economic message to voters. David Leonhardt of the New York Times Magazine released his Sunday story today on Obama's academic battle on economic policy:

"With Obama, there is vast disagreement about just how liberal he is, especially on the economy. My favorite example came in mid-June, shortly after Obama named Jason Furman, a protégé of Robert Rubin, the centrist former Treasury secretary, as his lead economic adviser. Labor leaders recoiled, and John Sweeney, the head of the A.F.L.-C.I.O., worried aloud about “corporate influence on the Democratic Party.” Then, the following week, Kimberley Strassel, a member of The Wall Street Journal editorial board, wrote a column titled, 'Farewell, New Democrats,' concluding that Obama’s economic policies amounted to the end of Clintonian centrism and a reversion to old liberal ways."

"Some of the confusion stems from Obama’s own strategy of presenting himself as a postpartisan figure. A few weeks ago, I joined him on a flight from Orlando to Chicago and began our conversation by asking about his economic approach. He started to answer, but then interrupted himself. 'My core economic theory is pragmatism,' he said, 'figuring out what works.'"

Pragmatism? Figuring out what works? Really? Fantastic! Not only is there a fight between the netroots and grassroots of the Left, there's a fundamental fight within the academic wing of the Left on the principles of free markets vs. the principles of European social democracies. They're obviously trying to merge the two in some sort of coherent fashion, but have failed miserably. So how can McCain take advantage of this and continue his surge in the polls?

I really hate the paradigm of the “hyphenated American”. And I really hate talking about race and politics in such limiting terms. And in an election year where we are debating whether or not a certain presidential candidate will take us into a “post-racial” era (as Matt Bai talks about in the next NYT Magazine), any discussion about how one tries to appeal to different ethnic communities seems to be both very silly and very relevant at the same time.

But Megan Shank of Newsweek wrote one of the first pieces of this cycle on the mystery of the Asian-American voter, and more importantly the mystery of the Asian-American non-voter; as Shank describes, “both naturalized and U.S.-born Asian Americans have lower rates of voter registration than do non-Asians.” As an "American citizen of Korean descent" (that’s my way of getting rid of the hyphen), I felt compelled this one time to respond and really start a discussion about what makes Asian-Americans tick.

Now, what I am about to opine on comes from a combination of life experience being raised by Korean immigrants, my limited experience of dealing with Asian communities around the nation, and maybe some bald assertions about what Asian-Americans care about.

(Sidenote on the title of Shank’s article: it’s “Crouching Voter, Hidden Direction.” Some might find that offensive. I find it hilarious.)

Shank starts out by describing the potential demographics:

“Their numbers might be small compared to other ethnic groups—only 5 percent of the total population—but they’ve been growing nine to 10 times faster than the general population, according to the U.S. Bureau of the Census. That could swing the ballot in key states, according to ‘Awakening the Sleeping Giants?,’ a recent report by researchers at UCLA.”

But it seems as though Shank assumes that larger and growing numbers will automatically lead into some sort of political power. Nothing could be further from the truth. First, the netroots of the Left and the extremist environmentalist movement have shown that a small group only needs very good organizational skills to make an impact. Furthermore, it seems that different ethnic groups have different senses of where “community” lies in their list of priorities. It is obvious that African-American and Latino-American citizens place community about as high they do family. From my experience, this is not true for Asian-Americans. The reason one probably does not see large organized political movements from Asian-Americans is that they place family as the highest priority, far above any other item. Pride in being Chinese, Korean, or Thai ranks far less than the pride in being part of your family. Succeed, and you bring blessings to your family; fail, and you bring shame.

At the heart of Barack Obama's economic proposals - those that he has promised to deliver if he becomes President - is the expiration of the Bush Tax Cuts. He promises to "restore fairness to the tax code", and provide middle class tax relief. While we can all applaud the objective of more tax relief, Obama plans on 'paying' for this by allowing the Bush Tax cuts to expire - a punitive measure against the 'rich'.

Republicans, now that Lincoln Chafee is out of the party, need a unified and strong message against such a stupid move. They were handed one earlier today in the form of an interview with the Nobel prize winning economist Robert Mundell in the Wall Street Journal: An Economist Who Matters.

Mundell, Professor of Economics at Columbia University in New York, has served as an adviser to the United Nations, the IMF, the World Bank, the European Commission, several governments in Latin America and Europe, the Federal Reserve Board, the US Treasury and the Government of Canada. He is considered to be the father of the euro - first proposing a common currency in Europe in the 70s - and won his Nobel Prize in Economic Science in 1999. His world-wide credentials are impeccable.

His interview with the Wall Street Journal's Kyle Wingfield this morning is fascinating. For our purposes, let's focus on what he views as the biggest threat to the world economy at the moment - allowing the Bush Tax Cuts to expire:

Back in America, there's an election going on. There's also been a spate of financial problems, not the least of which is a weak dollar. But Mr. Mundell says "the big issue economically . . . is what's going to happen to taxes."

Democratic nominee Barack Obama regularly professes disdain for the Bush tax cuts, suggesting that those growth-spurring measures may be scrapped. "If that happens," Mr. Mundell predicts, "the U.S. will go into a big recession, a nosedive."

One of the original "supply-side" economists, he has long preached the link between tax rates and economic growth. "It's a lethal thing to suddenly raise taxes," he explains. "This would be devastating to the world economy, to the United States, and it would be, I think, political suicide" in a general election.

..."the most important thing that could be done with respect to tax rates now is to make the Bush tax cuts permanent. Eliminating that uncertainty would be more important than pushing for a further cut – in the income tax rates, anyway."

To a media and a general public that views the bestowing of a Nobel Prize as the ultimate in credibility, this is pretty hard stuff. Are we to believe what Nobel winner Al Gore tells us, but ignore Nobel winner Mundell?

The interview is full of other interesting observations. Mundell feels that the optimum top tax rate in the United States should be 30%, and that the corporate tax rate should be 25%. He also believes that exchange rates should be fixed, much like they were fixed under Breton Woods until Nixon. He would like to see the EU and the Federal Reserve come to some sort of an agreement to keep the euro (whose idea he originated over three decades ago) between $0.90 and $1.30. Mundell also favors making the dollar the dominant currency against which all other currency would be fixed (he feels that the euro is vastly overvalued at present).

But it's his message on the expiration of the Bush Tax cuts which is most important to us, and to the nation. It's a message that all Republicans, and anyone else interested in our economy, should offer as a constant repeated message:

"The world's pre-eminent Nobel Prize winner in Economics has just told us that if we allow the Bush Tax cuts to expire, it will immediately plunge us into a deep recession - much worse that the situation we are currently slowly crawling out of - and will be disastrous to the world's economy for years to come. That world-wide economic disaster is precisely what Barack Obama has proposed."

Obama's populist message to tax the so-called rich and cut the taxes of the middle class relies solely on age-old class envy. But his dirty little secret is that he's smart enough to know that if the so-called 'rich' don't do well, the middle class doesn't get paid - and everyone suffers. The GOP must ask people to sit back and think for a moment. To go after the 'rich' in order to punish them, be it people who make $100K, $250K, or a million dollars a year, always hurts the people whose lives depend on those 'rich' people. Those other lives consist of the middle-class people that are directly employed by the 'rich', and middle-class people who are employed by the companies that the 'rich' buy goods or services from. And how about the elderly who rely on the income from retirement funds or stock sales to live, and to help their families? They would be hurt by Obama's so-called "fairness" as well.

Obama's populist claptrap is easy to poke holes it. But the press is going to protect him as much as they can. The GOP must have a unified, consistent, and loud message on issues like taxes. That is the only way that the Republicans are going to be heard above the media by the American people.