Rich Lowry asks: “Where are the jobs?”

Rich Lowry is the fellow who wrote the piece for National Review entitled "We're Winning [in Iraq]," but he wrote it back in 2005 when the US was most certainly not winning.  Lowry writes a basically decent piece today that takes the Republican Party to task for forgetting about jobs. Lowry gives far too much credit to the Republican Party for being sincere in their desire to fix Medicare's long-range difficulties ("If political life were fair, they’d be rewarded for their farsightedness") but is absolutely correct is saying that:

If you are worried about the security of your job, if your personal income is stagnant, if the value of your home is still declining, and if you are paying more for food and fuel, the perilous state of a government program circa 2024 that you know, one way or the other, will never be permitted to go bankrupt is not a subject of proverbial kitchen-table conversation.

Unfortunately for the Republicans, Lowry is also correct when he says:

Retreat on Medicare isn’t an option now. Like Cortes in Mexico, Republicans have disabled their ships behind them.

I strongly endorse Lowry's prescription here:

Deficit reduction should only be an element of a program for renewing the economy, which directly impacts people’s lives and also makes controlling the debt marginally easier. By a rough back-of-the-envelope calculation, every 1 percent of economic growth above the assumptions of the Congressional Budget Office knocks $2 trillion from the debt over the next 10 years.

My only revision to Lowry's suggestion is that deficit reduction should be placed entirely on the back burner and that the government should concentrate entirely on economic growth. Any serious attempts to cut the budget should wait until the country is prosperous and citizens have plenty of jobs and our infrastructure is well on the way to getting fixed and America is well on the way to replacing fossil fuels with renewable energy. In other words, deficit reduction is not an "element" of economic recovery. Deficit reduction is a luxury we can't afford for the next half-decade, at least.

The real problem I have with Lowry's piece is in the next-to-last paragraph:

House Republicans just released a growth plan. Sen. Rob Portman of Ohio has been evangelizing for a growth agenda since his election last year. The elements are familiar — cutting taxes and reforming the tax code, reining in regulation, increasing energy production, passing free-trade agreements. It doesn’t have much chance of getting signed into law, but neither does Ryan’s Medicare plan.

This plan has the slight problem of having absolutely nothing to do with economic growth. G.W. Bush cut taxes back in 2001 and 2003 and growth has been anemic ever since. Not sure what "reforming the tax code" means, but it sounds like allowing the rich to keep even more of what they already have and preventing the government from making use of the money that's sitting around in money market accounts and not going to much use. "[I]ncreasing energy production" sounds good, but I suspect it's just code for "drill, baby, drill," i.e., let's use up our energy resources even faster without attempting to find  any replacement sources. Free-trade agreements simply allow corporations to outsource jobs to other countries and thus are in direct opposition to getting the economy at home moving. It means more pay for those who are already wealthy, but it's far from clear that the non-rich will benefit in any way. Please note that with the passage of NAFTA (Activated back in 1994), the share of income from the five quintiles was

Year	Share of aggregate income
	Lowest fifth	Second fifth	Third fifth	Fourth fifth	Highest fifth	Top 5 percent

1994 (24)

4.2

10.0

15.7

23.3

46.9

20.1

2001

4.2

9.7

15.4

22.9

47.7

21.0

2009 (36)

3.9

9.4

15.3

23.2

48.2

20.7

This is not simply the result of NAFTA, but of a whole series of political decisions to move money to the higher tax brackets and away from those who are making less to begin with.  No, Senator Portman doesn't want economic growth, he just wants to continue the movemen of money upwards and to use up natural resources to the long-range detriment of the entire planet.

Lowry's piece is essentially a good one, but his proposed plan for growth is a complete FAIL!

Ryan plan rebuked in special election

Kathleen Courtney Hochul, the Erie County clerk and longtime Democratic figure who defied political experts who had given her little chance of success, ground out a stunning and surprisingly comfortable victory Tuesday in the special election for the House seat in the predominantly Republican 26th Congressional District.

Hochul defeated Republican Jane L. Corwin, a Clarence assemblywoman, 47 percent to 43 percent, with 97 percent of election districts reporting, while the Tea Party’s Jack Davis mustered only 9 percent in his fourth try for the seat. Ian L. Murphy of the Green Party recorded 1 percent, while overall turnout was about 25 percent.

The results marked a stunning defeat for the GOP in a contest that garnered intense national attention as the first competitive race following the Republican takeover of the House in last November’s elections. And as a jubilant Hochul took the stage at her headquarters at the UAW Hall in Amherst at about 10:30 p.m., she reminded supporters about the core of her campaign — controversial proposals by the GOP to revamp Medicare.

This tells us two things. First, Rep. Paul Ryan’s (R-WI) plan to toss granny onto the tender mercies of the marketplace with nothing more than a voucher that she can purchase insurance with, a voucher that will decrease in value over time, was a really lousy idea that should never have been proposed. Second, for the zillionoth and 23^rd time, Howard Dean’s 50-State Strategy is confirmed. It always was the better way to go and it proved itself once again. Even though Hochel didn’t have any reasonable chance to win her contest just a few short months ago, the Republican overreach gave her an opening and, because she already had an organization on the ground and ready to go, she was ready to take advantage of the opportunity.

Democrats should work hard to exploit this victory. They should drop all talk of a “Grand Bargain” between themselves and Republicans (I’ve very strongly urged the progressive Senator Dick Durbin (D-IL) to simply drop his membership in the “Gang of Six” and to just toss all of those plans into the recycling bin) and should adopt Minority Leader Nancy Pelosi’s plan to simply stand behind Social Security, Medicare and Medicaid and to just plain support all three of them unconditionally. There’s absolutely no call for reducing the federal budget to where Republicans would like to take it.

Update: Rather jarring to see a word here that really doesn’t belong in President Obama’s message of congratulations: “Kathy and I both believe that we need to create jobs, grow our economy, and reduce the deficit in order to outcompete other nations and win the future.” (Emphasis added).

What in the heck does reducing the deficit have to do with anything?!?!?!? The deficit is a purely technical problem that nobody would ever notice or be aware of were it not for deficit scolds nagging the country about it all the time. Jobs and growing the economy are serious and meaningful issues that have a direct impact on people’s lives. Those first two goals are often in conflict with the goal of reducing the deficit.

There’s not the slightest question as to where Democrats should stand when it comes to a conflict between the two goals Democrats should stand firmly and forthrightly in favor of jobs and growth. The deficit should be handled, it’s not a good thing to have a big deficit, but that’s a very distant second priority.

Minority Leader Nancy Pelosi rips Republican budget

Ooh! That's gotta hurt! Pelosi points out, quite correctly, how the Republican budget both hurts seniors and benefits wealthy supporters.

Update: Derek Thompson from the Atlantic defends the media's overlooking job-creation as a deficit-reduction strategy by saying "Nobody's talking about it." well, perhaps Republicans aren't talking about it, but the blanket term "no one" obviously doesn't include Democrats, who have been talking about job creation quite a bit.

The effects of state taxes

At the same time that NPR concludes that “Y'know, raising state taxes on the rich does not cause them to flee to lower-tax states,” Texas decides, in the middle of a fiscal crisis, to do without $1.4 million annually by giving a tax break to people buying yachts!

Now, I can kind of understand Texas' decision on the grounds of economic stimulus, but this decision only applies to the ultra-wealthy. It means nothing to Joe or Jane regular-person. There are no stimulus measures that apply to non-millionaires. And yes, the NPR study appears to me to be entirely sensible. It concludes that wealthy people tend to have strong ties to the community as they tend to have established businesses with long-time customers and employees and tend to be involved in other community activities (The e-e-evil Koch brothers also give money to an impressive list of decent and worthwhile recipients), so no, wealthy people are not likely to up and leave because the state takes a bit more of their money than they did the year before.

Do state taxes affect whether or not they move into a state to begin with? Not really, as rich people move to where the customers are. If people are moving to California to take part in the Gold Rush, hey, someone's got to sell them the pans, picks and shovels they'll need to do their gold retrieval!

And what is the cause of Texas' fiscal crisis? As we're seeing with lots of other states (Specifically, California and the 1978 Proposition 13), the real problem is under-taxation. The wealthy aren't paying nearly enough to cover the state bills.