On TAP: Kuttner + Meyerson

Kuttner
June 22, 2018

Trump’s Full-Blown Trade War. It’s one thing for Trump to demonize Mexicans. Disgracefully, that’s popular with his base, and it also confuses some of the progressive community, because NAFTA really does need to be renegotiated. 

It’s quite something else to invite retaliation from China with a tit-for-tat tariff war that could be devastating for American farm exports (in mostly Republican states). The EU, likewise, has now decided to strike back with retaliatory tariffs, which will harm American exporters and of course workers, as well as splitting the Republican coalition.

The strong rate of GDP growth and low unemployment rate have done nothing for workers’ wages, which have actually declined slightly in the past 12 months. But at least the robust economy has given Trump some bragging rights. This success will be at serious risk in a full-blown trade war.

To be sure, the current trading system does not serve American workers. But neither do Trump’s bizarre, tweet-driven policy thunderbolts, raising tariffs and insulting allies helter-skelter.

In that respect, Trump has done a triple public service, however inadvertently. He has demonstrated that we need a different trade strategy for America—and that he is utterly incompetent to bring one about. And he has managed to divide his hard-core base from the Republican corporate and agricultural interests. 

Well done!

Meyerson
June 21, 2018

Will Another D.C. vs. Disdain Democratic Norms? When is a free and open election invalid? Apparently, when elected officials don’t like the result.

That’s the philosophy of Maine’s Trumpier-than-Trump Republican Governor Paul LePage, who has refused to expand Medicaid in his state despite the legally binding vote of Maine’s citizens, who passed a Medicaid-expansion initiative. LePage has been ordered by the courts to implement the expansion, but still refuses. Mercifully, LePage is termed out of office at year’s end.

Something like that could never happen in the nation’s most liberal jurisdiction, right? Well, maybe it could.

On Tuesday, voters in Washington, D.C., passed an initiative that would raise the minimum wage of tipped workers—currently, only $3.30—to the same level as the city’s non-tipped workers: $15, to be phased in over the next eight years. Unlike the Maine initiative, this one (Initiative 77 by name) was only advisory, but avowed liberals on the D.C. Council and the avowed liberal who’s the mayor wouldn’t thwart the decision of the city’ voters—or would they?

In fact, in the run-up to the election, both Mayor Muriel Bowser and ten of the 13 Council members came out against the initiative. I realize the dust is still settling from Tuesday’s vote, but so far, none of those ten has said that they’ll be bound by the voters’ decision or that they’ve reversed their position. One has even said that due to the relatively low voter turnout (17 percent of registered voters), the Council should feel free to ignorethe voters’ preferences.

The low turnout was chiefly the result of the fact that in the only race that people really focus on and that the media cover—that for mayor—Mayor Bowser drew no serous opponents whatever. Of course, by the logic that low turnouts invalidate results, Bowser’s re-election on Tuesday should also be tossed into the ashcan.

In opposing the initiative, council members aligned themselves with the local restaurant owners’ association and the National Restaurant Association, which in state after state is customarily the only organization that campaigns against minimum wage hikes not just for restaurant employees but for anyone. As the Prospect’sManuel Madrid has noted, the restaurants hired some dillies of right-wing consultants to run the No campaign.

The campaign the consultants ran was couched in the language of saving servers’ tips. Many servers in thriving restaurants opposed the measure, fearing that their tips would vanish in the wake of its passage. That hasn’t been the case in California, which enacted just such a measure—raising tipped workers’ hourly minimum to $15 over a long period of time—a number of years ago. In California, the amount servers make in tips remained essentially the same.

Nor were the tipped workers opposed to the measure a representative sample of the District’s tipped employees. Their ranks didn’t include the hair and nail salon workers, the valet parkers, the folks who deliver meals to your door, and the servers in less affluent neighborhoods. The net income of these workers—the $3.30 an hour plus generally modest tips tips—don’t add up to all that much, which is likely why they were strikingly absent from the servers’ rallies against the initiative.

But this merely addresses the manifest merits of the initiative. What’s now before the council and the mayor is a more fundamental question: Do they accede to the will of the electorate, or do they accept the premise that low turnouts negate election results—notwithstanding the fact that they themselves have often won and re-won offices in low-turnout elections. If that’s their argument for reversing the voters’ decision, the only way they could do that in good faith would be to simultaneously resign.

Their real reason for opposing the measure, of course, is that politicians frequent restaurants and hold events there, and restaurant owners routinely make contributions to their local elected officials. In the cosmic chain of campaign-finance abuses, the restaurant-owner-council-member link isn’t really one that should excite reformers all that much. And there’s no question that some restaurants that operate on the margins may have to make some changes if the ordinance is adopted—though they have fully eight years to adjust.          

But there are thousands of servers in restaurants that aren’t overflowing with affluent diners, or who work trimming hair and nails and delivering pizzas, who are the mayor and council’s constituents, too, even if they don’t make campaign contributions. For all their hard work, they are struggling to survive in this high-cost city. For reasons both moral and economic, the voters just decided to give them a raise. There’s already one government based in D.C. that pays scant attention to voters’ preferences and democratic norms, but that’s what we’ve come to expect from Trump-era Republicans. That’s no reason why the District’s elected (and Democratic) government should join them in disdaining democracy.

Kuttner
June 20, 2018

Trump’s Tax Fraud. For months, we’ve been warning that you would pay the cost of Trump’s $1.9 trillion tax cuts. Well, here it is, the six-month anniversary of passage of the Tax Act, and the Republicans on the House Budget Committee just unveiled their plan: finance their increased deficit and balance the budget by cutting Social Security, Medicare, and Medicaid! 

Here’s the good news. The Tax Act, which was going to be a big political winner for Republicans, is turning out to be a huge loser for them. Republican candidates are running from it. The more that voters learn about it, the less they like it.

Democrats, some of whom defected to support the Reagan and Bush tax cuts, were united in opposition to this one, and are united in their efforts to turn it into a political winner—and a teachable moment about the fraud of supply-side economics, besides.

For the first time in our nearly 30 years of publication, the Prospecthas decided to devote and entire issue to a single topic—the Tax Act, as emblem and substance of all that is corrupt, opportunistic, and fraudulent of this period of Republican rule.

The print issue will be out next week. In the meantime, you can view some of the key pieces at Prospect.org, including the lead pieces by public opinion analysts Stan Greenberg and Guy Molyneux on how to make the Tax Act a winning issue for progressives.

Meyerson
June 19, 2018

The Three Kinds of Republican Officials. As Republican senators’, representatives’, and executive branch officials’ responses (ranging from deficient to depraved) to the separation of families at our southern border makes clear, there are three kinds of Republicans currently in office: the Failures, the Cowards, and the Bigots. There are overlaps among these categories, of course, but they’re typologically useful nonetheless.

The Failures are the self-proclaimed moderates who occasionally try to do the right thing but back off if it threatens Republican unity. The prime examples here are the Republicans who signed or thought about signing the discharge petition that would have forced the Republican House leadership to hold a vote on legalizing the Dreamers. This had been the marquee cause of a number of these moderates from swing congressional districts, including Florida’s Carlos Curbelo and California’s Jeff Denham, David Valadao, and Steve Knight. They vowed they had the 25 GOP votes that, combined with the votes of all 193 House Democrats, would come to 218—the majority that would have forced Paul Ryan to hold that vote. But they couldn’t get the total number of Republican signatories past 23—two votes short of 218. If Curbelo, Denham, and Co. were truly serious about legalizing the Dreamers, they’d recognize that that won’t happen until the Democrats control Congress, and stand aside to allow their Democratic opponents to win their swing districts this November—since, by the metrics they set for themselves, they’ve failed abjectly and completely.

The Cowards also don’t want to upset Republican unity or offend the GOP base, but though they object to a particular policy, they even don’t go as far as the Failures in proposing a plausible remedy. Exhibit A in this category is Maine Senator Susan Collins, who this weekend described the policy of family separation as being “traumatizing to the children who are innocent victims, and … contrary to our values in this country.” But Collins went on to say she opposed her Democratic colleague Dianne Feinstein’s bill to ban the policy, calling it “not the answer” because it was too broad. Susan Collins and her ilk don’t dare to eat a peach, lest it offend her pro-Trump voters.

That leaves the Bigots, who are either fine with the policy or call it distasteful but blame it on the Democrats or the cycles of the moon. The higher you go in the administration, the more bigots keep popping up, until you reach the president himself, who has referred to immigrants as “animals.” This is the language of bigots—indeed, it’s a justification for and rhetorical prelude to violence against those the bigot deems to be enemies. That doesn’t make the bigots animals, however. This kind of fear and loathing is peculiar to humans and, apparently, to a growing share of Republican officials. And Republicans generally: In a CNN Poll released Monday afternoon, Americans disapproved of the policy of family separation by a 67 percent to 28 percent margin—but Republicans approvedof it by a 58 percent to 34 percent margin. In fairness, that may be what comes of watching Fox News and believing its Goebbelsesque lies.

Which brings me to my own immigration policy. Why don’t we deport Rupert Murdoch? Is there any other immigrant who’s done more to destroy the fabric of American society and life than Old Rupe? And separate him from his kids: They can’t do a worse job of directing Fox News than the old man, and might just do better. 

Kuttner
June 18, 2018

Feeling Optimistic … or Pessimistic?Let’s try pessimistic first. Mueller is dragging out his investigation while Trump’s allies tighten the noose around him. And his report will only be a report. The impeachment process is hopelessly political, in any case.

Meanwhile, Trump succeeded in making his Korea talks look like a kind of breakthrough. Even his tariffs are rallying his base. His approval ratings are up slightly. And his immigration policy may be deeply inhumane, but it plays well in parts of the country that feel inundated with immigrants. Here’s the definitive piecefor pessimists, courtesy of our friends at Vox.

Feeling sick? Here’s the optimistic antidote. Of course the impeachment process is ultimately political—that’s how the Founders intended it. Quite apart from Mueller, the are plenty of impeachable offenses already on the public record: obstructing justice by firing Comey and using foreign policy to enrich himself, to name just two.

Dems are on the march to take back Congress. And then the impeachment process becomes a dynamic thing. As the public focuses more and more on it, Republican senators may well decide it’s time to dump Trump well before the 2020 election.

And schisms in the Republican Party are widening almost daily, over trade, immigration, and Trump’s corrupt China policy.

I’m with the optimists.

Kuttner
June 15, 2018

Inscrutable China Policy. Trump’s decision to move ahead with tariffs on $50 billion worth of Chinese exports prompted an immediate retaliation by Beijing. It’s a classic case of Trump using the wrong strategy to pursue a long-overdue revision of U.S. coddling of Beijing’s predatory state capitalism.

As an unnamed senior administration official, almost surely chief trade negotiator Robert Lighthizer or White House trade strategist Peter Navarro, told The New York Times:

China has a history of using state subsidies to build up excess capacity in a variety of industries that then pushes down prices and drives free-market competitors in the United States out of business. The United States cannot afford to allow China to carry out the same practices in emerging industries, including robotics, new energy vehicles and information technology.

Exactly right. But the right way to compel China to alter its model or to face economic sanctions is to work with the world’s other major trading bloc, the European Union, in a common China strategy. Trump, however, keeps going out of his way to insult and alienate the EU. Hello?

The hardening of the U.S. line makes Trump’s decision to allow the Chinese tech company ZTE back into U.S. markets all the more bizarre, and makes it even more likely that Trump’s real motive in this one-off favor to Chinese dictator Xi Jinping was to thank Xi for investing in a Trump enterprise in Indonesia and granting lucrative favors to Trump’s daughter, Ivanka.

Trump, with his tiny attention span and his penchant for lashing out, can’t manage to maintain a consistent policy from one day to the next. We do need a revisionist China strategy, but Trump’s version is a perfect marriage of the inept and the corrupt. 

Meyerson
June 14, 2018

Howard Schultz—Scourge of the Homeless—is a Republican. On Tuesday, in one of the most raw and callous displays of the power that major corporations can wield over cities, the Seattle City Council voted to repeal a business tax it had passed just four weeks ago to generate the funds the city needs to deal with its epidemic of homelessness. Seattle ranks third among all U.S. cities in the size of its homeless population, even though it is just the 18th-largest city in the land. (LA and New York rank first and second in both overall population and homeless population.)

Seattle doesn’t have a lot of options to fund increases in its spending. Under Washington state law, it can’t levy an income tax (it tried; a court struck it down). So it tried to capture a share of the city’s great wealth by imposing a tax on corporations with at least $20 million in yearly revenues. Each of those companies would pay a $275 tax for every worker it employed locally. The city’s largest employer—Amazon—has 45,000 employees within the city limits, which means it would have had to fork over $12 million annually. As Amazon’s revenues last year came to $178 billion, the tax would have been the proverbial drop in the bucket.

But Jeff Bezos, a committed libertarian, was made of sterner stuff. Rather than accept the tax, he teamed up with Howard Schultz at Starbucks and a group of other local CEOs to launch an initiative campaign to repeal the tax, and an accompanying propaganda campaign to ensure they’d get that initiative passed. That was enough to persuade the Council, by a 7-to-2 vote, to repeal the tax on Tuesday.

Unlike Bezos, the above-mentioned Mr. Schultz is not a libertarian. Indeed, he resigned as CEO of Starbucks—the company he founded—last week, encouraging speculation that he’s planning to run for president as a Democrat. In the past few weeks, he’s clearly made moves to bolster his Democratic bona fides by closing down 8,000 Starbucks so that its employees could grapple with racism. Then again, he’s also been giving interviews in which he’s said that Democrats need to reduce the nation’s spending on “entitlements”—that is, on Social Security, Medicare, and Medicaid.

But it’s the timing of his resignation—coming a couple weeks after he directed Starbucks’s assets into the campaign to gather signatures for the tax repeal initiative, but one week before that campaign compelled the Council to reverse course—that looks most interesting to me. Maybe, just maybe, he realized that if Starbucks was about to take away the last available funds with which Seattle could build and find shelters for its homeless, it might be a good idea if he were no longer the company’s CEO.

America being a land of opportunity, everyone, Howard Schultz included, has the right to run for president. But I think he’s running in the wrong party. Billionaires who say we’re spending too much on Americans’ retirement security and who invest their company’s dollars in campaigns to block aid to the homeless have a clear political home and it’s not the Democrats. Howard, boychik—you’re a Republican. 

Kuttner
June 13, 2018

The Moment of Truth for Republicans. For more than a decade, Republicans have decided that destroying the Democrats and the competence of government is more important than defending American democracy. We saw that under President Obama, when Republicans pursued a strategy of blocking whatever Obama attempted, sight unseen, and refused to compromise on anything other than keeping the government open. The roots of that policy date back to then-House Speaker Newt Gingrich’s efforts to destroy Bill Clinton.

We also saw Republicans and their allies in the courts conniving in voter suppression and substituting money for speech, and blocking Obama’s judicial appointees to an unprecedented degree. That was bad enough.

Now, under Trump, Republican enabling of both autocracy and a sellout of the national interest has reached new lows. With a few heroic exceptions, most Republicans have concluded that standing idly by while Trump makes truly bizarre foreign policy decisions that weaken America’s influence with allies and help totalitarian adversaries such as China, Russia, and North Korea is an acceptable price to pay for staying in power. The fact that many of these policies are lubricated by Trump’s personal financial self-interest seems not to matter either.

If we lose our democracy, or if we narrowly miss losing it, or if the U.S. ends up sacrificing a great deal of global influence, history will blame the Republican Party. Trump is a lunatic and a megalomaniac. At least some Republicans know better, but most refuse to act on their knowledge.

Meyerson
June 12, 2018

California Republicans have just enough understanding of basic numbers—such as, percentage of registered California voters who are Democrats, 45; percentage of registered California voters who are Republicans, 25—to know they’re not about to win any statewide races this November. But in the wake of last week’s primary elections, in which one Democratic Orange County state senator was recalled after Republicans waged a campaign against him for voting for a gas tax increase during the most recent legislative session, they think they’ve found the formula to boosting their prospects in congressional and other races this November: Run against the gas tax increase.

The increase, strongly backed by Governor Jerry Brown and the required two-thirds of the legislature, would make $5 billion available each year for repairing and updating the state’s rickety infrastructure: roads and bridges, as well as building new intra- and intercity rail lines. It’s backed by both business and labor and by various enviros. Republicans look at this and remember the tax-slashing Proposition 13, which the state’s business, labor, and political establishments opposed 40 years ago. New Republican gubernatorial nominee John Cox, who would stand a better chance this November if he ran as a Trotskyist, has vowed to campaign largely on repealing the gas tax increase.

Can the Democrats overcome this? Are Republicans’ hopes well-founded? There are two recent precedents for Democrats prevailing over similar challenges. In 2008, promoted by then-LA Mayor Antonio Villaraigosa, LA County voters approved a half-cent sales tax increase for the next several years to fund the construction of a countywide rail system and a better bus system. Eight years later, they re-upped that commitment, making the sales tax increase permanent. 

Getting LA County—which is home to roughly a quarter of the state’s population—to "yes" required the campaign’s advocates, including Villaraigosa and a coalition called Move LA, to make clear to voters what specific rail and road construction would take place where, with what tangible benefits. It worked. Both the 2008 and the 2016 votes required a two-thirds majority to pass, and pass they did.

So California Democrats have two choices before them as they go into the November campaign. Do they refuse to defend the gas tax hike and let the Republicans make hay, or do they do what Villaraigosa, the LA establishment, and the LA left did when confronted with the opposition to the sales tax hike: Make a case for what badly needed improvements those additional revenues would create. To do that, they have to specify what roads will be improved, what rail lines built—that sort of thing. A debate on taxes that focuses only on the tax and not on what it enables is always one in which the tax will be voted down.

To be sure, the LA experience is hardly an exact parallel of the current situation. The sales tax came in smaller increments and was less visible, though for all I know it took more money from the average Californian than the higher tax at the pump does. And LA is more liberal, and home to a smaller share of Republicans, than the state at large.

But Californians in every part of the state know how bad their roads are and how hard it is to get around town. There’s a case to be made that can largely nullify the Republicans’ attacks. Democrats—and most particularly, Jerry Brown—need to realize that the only defense for their tax hike is an offense that spells out what it will accomplish.

Kuttner
June 11, 2018

Trump’s Korea Diplomacy: A Catastrophic Success? Basically, there are two possibilities for Donald Trump’s Singapore Summit with Kim Jong-Un. Either Trump gets annoyed at Little Rocket Man, and storms out. Or the two leaders pretend to have made real progress.

What is out of the question is genuine steps towards nuclear disarmament on the peninsula—first, because it’s not possible to get that done in a brief summit meeting, especially with a leader as cavalier about details as Trump; and secondly, because there is no good formula for getting what both sides profess to demand.

The grail for North Korea is ridding the entire peninsula of nuclear weapons and drastically cutting the U.S. troop presence in the South. In return, Kim has talked about dismantling his own arsenal. But of course the devil is in the details.

If Kim does agree to disarm—and that has to mean both weapons and delivery vehicles—in exchange for security guarantees, what on earth could those guarantees be? Remember, the United States is a great power that double-crossed both Libya’s Moammar Gadhafi and the Iranians, after making solemn arms-control deals. 

And what nations would be responsible for enforcing the guarantees? The always-trustworthy Chinese? Maybe Trump’s pal, Putin? Surely not the European Union.

What is more likely is the simulation of a deal, with a declaration of broad principles, details to come later. That would serve the interests of both Trump and Kim, who have in common that they are world-class cynics.

Trump could claim a diplomatic breakthrough, burnishing his stature as a dealmaker who succeeds by breaking conventions and norms. Kim could enhance his stature as the North Korean leader whom the mighty United States agreed to treat as an equal.

The only problem is that any such breakthrough would be fake news at best, and dangerous capitulation at worst. How fitting for the Trump era. 

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