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House Republicans

It's been good to hear that Barack Obama now feels less pressure to accept bad compromises following his successful re-election bid, but as we approach the coming 'fiscal cliff', my biggest concern is not the President's tendency to triangulate.

What worries me far more is the likelihood that Congressional Democrats will miss out on a golden opportunity to seriously damage the Republican brand in the next several weeks, which is the very thing they must do if they want to regain control of the House of Representatives in 2014.

It is something they will be able to do if they can find a way to get themselves all on the same page regarding THE BLAME THAT THE REPUBLICAN PARTY DESERVES FOR CREATING THE CURRENT GOVERNMENT DEBT CRISIS.

They need to direct the attention of the media to the irony that while the Republicans are sounding the alarm about government debt, calling it a crisis, it is they who created the problem to begin with, back when they irresponsibly reduced the tax obligations of America's millionaires and billionaires during the George Bush Administration.

Democratic leaders should not hesitate to announce to the press that they have one very simple message they want to deliver to the Republicans in the House:

"First undo what your party did to create this budget crisis.  Then, with your credibility at least partly restored, we can talk about your ideas on government spending."
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(Cross-posted at Nontrivial Pursuits)

I am reposting this because I am actually quite proud of the fact that I was able to write an I-P diary that (1) speaks positively about the Palestinians, (2) is sympathetic to the Jewish people's deepest aspirations, (3) is optimistic about the possibilities of a lasting peace, and it does so (4) without generating any HR's.  If you haven't read it, I encourage you to do so.

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Once again, we've watched as Israel launched itself into yet another of its periodic efforts to 'defend' itself by seeking to kill all of the Palestinians in Gaza who have either killed Israeli Jews with missile fire, or have helped the militants in their efforts to kill Jews, or have maybe been considering the possibility of killing Jews in the future, or who have simply been hanging out around the missile launchers.

These 'lashing out' responses to Palestinian attacks always provide Israel's civilian population with a certain amount of short-term 'satisfaction', satisfaction that will last for at least another six months or so.  But if the Israeli people took some time to think their situation through from a long-term perspective, it might occur to them that the 'gut instinct' response is actually a very stupid approach for them to embrace, as a people, from one generation to the next.

Over the long run, it just hasn't worked.  They've embraced the 'muscular' approach for over 60 years and that is how many years it has failed to bring about lasting peace and security.  Something else must be done to make the killing stop.  Something other than simply preparing for the next 'beatdown' that you fully expect to be delivering again sometime in the future.

One would think that the Israelis might have put some serious thought into imagining what a future Lasting Peace would look like.  (By a lasting peace, I am necessarily talking about one that even the hawks in Israel would find acceptable and worthy of trust.)

I suspect that if they were to ponder this question at length, it would occur to them that if they want to achieve a lasting peace, it is essential that they find a way to change the feelings that the Palestinians currently have toward the Israeli population in Palestine, from very negative to very positive.

Feelings of hatred, for example, would need to be replaced with feelings of gratitude and good will.  Appreciative smiles must replace the furtive looks that only barely hide feelings of fear and loathing.  If this does not happen, how will it ever be possible for the Israeli people to feel secure in their homes?

This is the supreme, ultimate key to constructing a peace agreement that could actually succeed in ending the conflict between Arab and Jew.  Any 'agreement' that Palestinian leaders could be coerced into accepting through muscular diplomacy and international pressure is guaranteed to fail if it does not replace the feelings of hatred that the Palestinians currently feel with feelings of gratitude.

Isn't that something that we can all agree on?

What, if anything, could be done to bring about such a wondrous change in the hearts of the Palestinian people?  That is THE key question that the Israeli people need to start asking themselves.

(continued...)

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(Cross posted at Nontrivial Pursuits)

There is one time when you can be absolutely certain someone is lying to you, and that is when their words are directly contradicted by their actions.

The Republicans have been blaming the Democrats for excessively high levels of government borrowing in recent years, but it was actually their own actions during the Bush Administration that were/are responsible for virtually all of the borrowing that they decry.

The single biggest reason why the federal government had to borrow hundreds of billions of dollars during Obama's first term was not because the Democrats had increased government spending dramatically---they did not---but was only because the Republicans under George Bush had reduced the tax 'burden' of America's wealthiest income-earners dramatically.

If the Republicans had not cut the tax rates of rich Americans a decade ago the total amount of revenues the federal government would have collected since that time would have been so substantial (one estimate: $5.9 trillion) that very little borrowing would have been necessary to cover the government's spending throughout Obama's first term.

The 'Debt Crisis' that Congressional Republicans complain about with such passion was created---without any doubts whatsoever---by the tax cut gift that The Republican politicians decided to give to themselves and their wealthy friends in 2001 and 2003.  It was the drop in revenues that this stupid move caused which forced the federal government to begin borrowing billions of dollars in order to pay it's bills.

(continued...)

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I am an observer who thinks Barack Obama will hit a home run against Mitt Romney tonight. Sure, Obama has the advantage of being the one who actually executed Osama Bin Laden for the Nine Eleven attacks, but it's more than that.

In a campaign that has become all about Image and Emotions, Barack will have numerous opportunities to express outrage at Romney's insinuations re: his character, his judgments, his patriotism, etc.  ("Governor Romney, how dare you...")

He should be prepared at a moment's notice to stop talking about the specifics of Foreign Policy issues and just focus the entire debate/campaign on Mitt Romney's character flaws and his staggering ignorance of the nuances of foreign relations.

Barack Obama will win this debate solidly---and the election as well---if he leaves the Swing Voters who watch it feeling fearful at the thought of Romney making decisions as Commander-in-Chief.

And here's the thing, Mr. President...you will need to model that fear, yourself, just the way the Republicans always do it.  Show them what they should be feeling.  They'll get it.

That is how you connect with the uninformed.

At those times when you are not speaking in a concerned voice about the scary implications of Romney-ism, you should be shaking your head and laughing, incredulously, at Romney's consistent foolishness in F-P matters.  (It would be funny if the stakes weren't so serious...)

The Swing Voters who will decide next month's winner are going to vote based on the emotions they feel when they think of each candidate after watching tonights debate.  It is the reason why Barack Obama must focus on two things during tonight's debate:

(More...)

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Crossposted at Nontrivial Pursuits

Last night, during a 60 Minutes interview, Mitt Romney was asked if he thought it was fair that he only paid a 14% tax rate on his $20 million income while a guy earning $50,000 paid taxes at a higher rate.

Romney replied,

Yeah, I think it's the right way to encourage economic growth, to get people to invest, to start businesses, to put people to work.
He was acknowledging the fact that most of his income was taxed at the lower 14% rate that is applied to income defined as capital gains.  Romney is just one of a long line of Wall Street apologists who has exploited the impreciseness of the word investment to champion tax policies that sound as though they are beneficial to the economy, but actually are not.

There is no better example of their talents at obfuscation than the famous Capital Gains Tax Rate, promoted by Republican Myth Makers for generations as a great way to stimulate “investment.”

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I appreciate all of the 'stiff upper lip' talk expressed by so many of you in these days following the Wisconsin debacle, but I'm afraid I can't join you this time.  I am now feeling quite totally despondent re: Progressive electoral prospects in the near future.

The Republican Party has always held a $$ spending advantage over Democrats, but now the lid has been completely blown off, two years after the Citizens United decision.  IMO, several factors are now working together to virtually guarantee a devastating defeat for the Democrats this fall...

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Rich vs. Poor

Barbara Ehrenreich's poignant Preying On The Poor provides us with an all-too-accurate picture of The Poor as chronic victims of a hard-hearted Business Class.  It is a sad reality that many of us are forced to experience on a daily basis.

The urge to Do Something about this atrocity is strongly felt by nearly every Democrat, but what is that 'something' that ought to be done?

I happen to be one of those 'economists' who believes that the best way to solve problems like this is through the marketplace.  Instead of passing innumerable acts of legislation to deal with specific examples of corporate meanness, I suggest that an effort be made to influence the marketplace in a way that would actually give economic power to The Poor.

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Economic Myths In Economic Textbooks

If you were to examine virtually any of the textbooks currently used to teach economics in college classrooms, you will find "Tax Cuts" listed under the heading of "Tools of Expansionary Fiscal Policy."

It is an unfortunate error of great significance, for it is at least partly responsible for the failed experiments with Austerity that we have witnessed in recent years on both sides of the Atlantic (at great human cost).

It is an error that seems almost inexplicable coming from professionals who are accustomed to thinking of themselves as 'scientists' devoted to the ideals of accuracy and precision.

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Economic Myths In Economic Textbooks

If you were to examine virtually any of the textbooks currently used to teach economics in college classrooms, you will find "Tax Cuts" listed under the heading of "Tools of Expansionary Fiscal Policy."

It is an unfortunate error of great significance, for it is at least partly responsible for the failed experiments with Austerity that we have witnessed in recent years on both sides of the Atlantic (at great human cost).

It is an error that seems almost inexplicable coming from professionals who are accustomed to thinking of themselves as 'scientists' devoted to the ideals of accuracy and precision.

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(Cross-posted at Nontrivial Pursuits)
                                    .
I am an 'economist' who happens to be a huge fan of Paul Krugman.  There is really no economist on the planet whom I hold in higher esteem.  But alas, my hero has come up short in his most recent blog entry in which he said this about Congress' 2008 bailout of institutions that were considered Too Big To Fail:

...there are in fact very good reasons to intervene to support banks during a financial crisis...the only feasible strategy is guarantees and a financial safety net plus regulation to limit the abuse of those guarantees. It’s imperfect; it faces the constant threat of regulatory capture; but it has worked in the past, and it’s the only game in town.
No, Paul, no. Arrrgh!  Bailing out privately-owned, for-profit banks when their gambling has---once again---gotten out of control is not the only game in town.  What you are telling the Occupiers of Wall Street is that the big banks they are standing in front of really were Too Big To Fail.

(continued)

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CNN is reporting that President Obama will be proposing a job creation package that may top $400 billion:

While some sources put the size of the package at roughly $300 billion, one Democrat familiar with the president's plan said Wednesday that the working figure was growing and could top $400 billion.
Sounds good, right?  Maybe even a little bit encouraging?  Forget about it.

By now we can already guess the ultimate outcome of this.  The Republicans in the House will agree with all the tax cut provisions but will insist that all those tax cuts be paid for with spending cuts.

The President, of course, will---after some days/weeks of arguing fruitlessly with the House Republicans---accept a smaller package that is paid for entirely by spending cuts, which will guarantee that no actual stimulus to the economy will occur.

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Thu Sep 01, 2011 at 12:20 AM PDT

Stupid Rich People (Part 2)

by James Kroeger

                                     Cross-posted at Nontrivial Pursuits

                                                .

Golden Bathroom

Yes, rich people---or rather, rich Republicans---are really quite stupid.

One would think that rich people---of all people---would have an advanced understanding of how markets work, but alas, they do not.  If rich people understood how markets work, they wouldn't get themselves all worked up about the idea of paying higher taxes.  They'd just pay them and be happy about it.

And they would not have wasted all the billions of $$ they have thrown at the Republican Party over the decades just to get their tax obligations reduced.

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