The “Candy Option”

#SameSameButDifferent | #WhatTheyVotedFor

“As full-blown tax reform looks more and more like an unreachable stretch, there’s increasing conversation on the Hill about what’s being called a “candy option”—all the goodies, with none of the pain.”

―Jonathan Swan

Three brief notes go here:

• A Senate aide is actually calling it, “the candy option”.

• Apparently, the reason for a candy option, in the first place, is that, “It’s something they can pass”, according to an unnamed Republican lobbyist.

• The Axios report includes a note that, “Both House and Senate leadership sources tell us they don’t think the ‘candy’ route is feasible”.

The Brownback Effect

This is the part where reality comes crashing down:

Lots of numbers in a new statewide survey of Kansas from Fort Hays State University, but here’s the stunner:

Only 18 percent of state residents said they were “very” or “somewhat satisfied” with GOP Gov. Sam Brownback.

Kansas, in case there’s any misunderstanding, is a heavily Republican state.

President Barack Obama, long a punching bag for Republicans, rated higher. Some 28 percent of respondents expressed satisfaction with the Democratic chief executive.

(Krase)

The whole thing with Kansas and Mr. Brownback really is a puzzle; it’s one thing to point out that he is wrecking the state’s finances to the point that schools can’t function, thus observing that there is a reason Kansans are annoyed with their governor. But there is also a twist, that Sunflower State voters already knew most of that when they re-elected Gov. Brownback last year.

Certainly, the numbers are remarkable; Mr. Brownback is so awful, in Kansans’ eyes, that President Obama now suffers less ill will in the Jayhawk Midway Wheat State. To the other, though, the notion of self-inflicted damage asserts itself. Kansans quite literally did this to themselves, and we might make that crass joke, “And we’re all just so proud of them for doing such a super job!” but in truth, no, nobody is proud. Nor is this merely a Kansas thing; the Brownback Way is merely a revival of the supply-side mysticism, the “voodoo” economics, of thirty years ago. And this Republicans would inflict on the nation.

Steve Benen recalls Mitch McConnell, who described the Brownback Way as, “exactly the sort of thing we want to do here, in Washington, but can’t, at least for now”:

“At least for now,” of course, refers to the fact that there’s a Democrat in the White House.

In other words, Kansas’ “experiment” – massive tax breaks, coupled with drastic cuts to public investments – is “exactly” the model Republicans want to impose on the nation. They’re just waiting for a far-right president to work with a far-right Congress, just like Kansas’ far-right governor worked with a far-right legislature.

It really is the strangest thing.

Then again, this is Kansas. They have their priorities.

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Image note: Kansas Gov. Sam Brownback (R) speaks at CPAC, 28 February 2015. (Detail of photo by Gage Skidmore)

Benen, Steve. “Obama tops Brownback in ruby-red Kansas”. msnbc. 26 October 2015.

Krase, Steve. “Gov. Sam Brownback in deep hole with Kansans”. The Kansas City Star. 24 October 2015.

A Presidential Retort

Last week, President Obama addressed the City Club of Cleveland; he also spoke his mind about a few things having to do with the way of things in Washington:

It’s important to note that at every step that we’ve taken over the past six years we were told our goals were misguided; they were too ambitious; that my administration’s policies would crush jobs and explode deficits, and destroy the economy forever. Remember that? Because sometimes we don’t do the instant replay, we don’t run the tape back, and then we end up having the same argument going forward.

One Republican in Congress warned our policies would diminish employment and diminish stock prices. Diminish stock prices. (Laughter.) The stock market has doubled since I came into office. Corporate profits are―corporate balance sheets are stronger than they have ever been―because of my terrible business policies. (Laughter.)

One Republican senator claimed we faced trillion-dollar deficits as far as the eye can see. Another predicted my reelection would spike gas prices to $6.60 a gallon. (Laughter.) I don’t know how he came up with that figure―$6.60. (Laughter.) My opponent in that last election pledged that he could bring down the unemployment rate to 6 percent by 2016―next year―at the end of next year. It’s 5.5 now. (Applause.)

And right here in Cleveland, the leader of the House Republicans―a good friend of mine―(laughter)―he captured his party’s economic theories by critiquing mine with a very simple question: Where are the jobs, he said. Where are the jobs? I’m sure there was a headline in The Plain Dealer or one of the papers―Where Are the Jobs?

Well, after 12 million new jobs, a stock market that has more than doubled, deficits that have been cut by two-thirds, health care inflation at the lowest rate in nearly 50 years, manufacturing coming back, auto industry coming back, clean energy doubled―I’ve come not only to answer that question, but I want to return to the debate that is central to this country, and the alternative economic theory that’s presented by the other side.

Because their theory does not change. It really doesn’t. It’s a theory that says, if we do little more than just cut taxes for those at the very top, if we strip out regulations and let special interests write their own rules, prosperity trickles down to the rest of us. And I take the opposite view. And I take it not for ideological reasons, but for historic reasons, because of the evidence.

Imagine that. Evidence.

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Obama, Barack. “Remarks by the President to the City Club of Cleveland”. The White House. 18 March 2015.

Brought to You by the Letter ‘A’

The life cycle of bad ideas is a curious thing.

No, wait, no it isn’t. Something about history repeating itself and not being smart enough to recognize the point goes here. At any rate, Simon Maloy tries to explain a thing or two about the latest revival of supply-side mysticism:

they love cutting taxes for rich people, and they’re also enthusiastic deficit scolds. There’s a seemingly irreconcilable tension in that worldview that arises from a straightforward assumption: cutting tax rates for the people who pay the largest share of taxes will result in the government taking in less revenue.

The way they get around this dilemma is through the magic of dynamic scoring. Basically, when they calculate the cost of a tax cut, they assume that cutting taxes will produce an explosion of economic growth that will actually result in higher tax revenues. Cutting taxes, therefore, won’t increase the deficit – it could actually lower it! This is, to put it mildly, a contentious idea. Dynamic scoring on its own isn’t a particularly controversial practice, but strong proponents of supply-side economics vigorously abuse it in order to make some ruinous economic proposals seem palatable.

One of the biggest adherents of dynamic scoring is Rep. Paul Ryan, the incoming chair of the House Ways and Means Committee. The most recent of his celebrated ultra-conservative budget proposals made enthusiastic use of dynamic scoring in order to achieve balance in 10 years while simultaneously slashing tax rates and boosting defense spending. When you just assume that lowering tax rates will supercharge economic growth, anything becomes possible.

This is hardly news: The presumed increased revenues resulting from tax cuts are simply presumptions.

Those who remember Voodoo Reaganomics occasionally scratch their heads and wonder, “What? We’re still having this discussion?” And those who remember the financial crisis that started with the Bear Stearns collapse in 2007 can always blame it on the president who was elected in 2008 and didn’t take office until 2009. The idea is simple enough, that if the government takes less money in taxes, that money will produce even more in taxes under lower rates by staying in the consumer and business economies. The result, of course, is a widening gap between rich and poor, a private business sector that has become so privileged it feels the products and services it offers in exchange for money are merely obstacles they must overcome in order to get what is rightly theirs—namely the money in your pocket—and a resounding, persistent failure to produce the promised returns. All of these, of course, are why Rep. Paul Ryan (R-WI01) calls “dynamic scoring” by another moniker, “reality-based scoring”.

You see, sometimes a joke is funny because it’s true. In the Republican Party, a fantasy is true because it sounds funny.

No, wait, that’s still not right.

The thing is that we have an ongoing supply-side experiment in progress, and that is called Kansas, where Gov. Sam Brownback and his supporters—self-described (ahem!) “Brownbackers”—have produced not the fantasy results but, rather about what you might expect. Fiscal affairs in Kansas government are a bit sensitive at the moment, but don’t worry, the fantasy math says things will work out okay in the end.

Strangely, Mr. Ryan, the GOP vice presidential nominee in 2012, is considered something of a budget wonk.

Perhaps they have the wrong vowel.

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Maloy, Simon. “Paul Ryan’s ‘reality’ problem: Why his justification of ruinous supply-side tax policies is warped “. Salon. 1 December 2014.