The New Normal

Too many Americans appear willing to accept the hand they're dealt. Most shockingly, many of our political, educational and civic leaders seem to have fallen into the same trap. "The New Normal," they call it. Like Death and Taxes. Etched in stone. Undefined, yet not re-definable. Inevitable.

Fortunately, there are those among us willing to demand a new deck of cards -- and a new dealer!

We've seen the rise of the Forces For Fairness in states like Wisconsin where there is no disguising the unsubtle, in-your-face, anti-democratic, vitriolic, bought-and-paid-for policies of Governor Scott Walker, the Brothers Fitzgerald, ALEC, the Koch Brothers and their yes men and women (even the few remaining Republican moderates - if they still can be called such - who should know better). In the Badger State, tens of thousands took to the streets of Madison and are now actively participating in recall efforts to change the equation and prevent Wisconsin from being turned into a place totally unrecognizable.

Nationally, I see a rising consciousness and an emerging consensus that congressional Republicans have one-upped their Gingrichian colleagues from the 1990s in overreaching on fiscal matters. Voters do not like the draconian cuts being pushed through by House Republicans, the intransigence and obstructionism practiced as a religion by Senate Republicans, the GOP's willingness to hold America's bond rating and our economic recovery hostage by refusing to raise the debt ceiling, and an adherence to a baseless and extremist anti-tax philosophy. In a recent CBS News poll, 71 percent of Americans are opposed to the way the Republicans are approaching the debt limit debate. As well they should be.

Americans are NOT opposed to raising taxes on the wealthy to address our national debt. A recent Reuters poll found that 52 percent of Americans believed that "a combination of spending cuts and tax increases was the best strategy to reduce deficits." Republicans are so constrained by anti-tax pledges that they even believe a repeal of ANY tax cut or the closing of ANY tax loophole (even those for corporate jet owners!) would result in Grover Norquist gagging them with a mouthful of tea bags and ordering them to a permanent political purgatory.

If more Democrats had shown the courage to stand up sooner and establish the terms of the debate, this emerging consensus could have been precipitated. The likes of Vermont's Bernie Sanders have had it right for some time in the call for "shared sacrifice." Others, including President Obama, appear to be catching up to the reality that was evident to Sanders and other Progressives: Congressional Republicans are economic extremists willing to drive the American economy into the ground in order to assuage the Anti-Tax God (don't let it go to your head, Mr. Norquist).

"The Rock and the Hard Place on the Deficit", an op-ed in last Sunday's New York Times, written by Christina Romer, is one of the best articles I've read that puts the substance of this issue into context. For the benefit of you non-Times subscribers, here are some key highlights:

The economic evidence doesn’t support the anti-tax view. Both tax increases and spending cuts will tend to slow the recovery in the near term, but spending cuts will likely slow it more. Over the longer term, sensible tax increases will probably do less damage to economic growth and productivity than cuts in government investment.
...

There is a basic reason why government spending changes probably have a larger short-term impact than tax changes. When a household’s tax bill rises by, say, $100, that household typically pays for part of that increase by reducing its savings. Its spending tends to fall by less than $100. But when the government cuts spending by $100, overall demand goes down by that full amount.

Wealthier households typically pay for more of a tax increase out of savings, and so they reduce their spending less than ordinary households. This implies that tax increases on wealthy households probably have less effect on the economy than those on the poor or the middle class.

All of this argues against any form of fiscal austerity just now. Even some deficit hawks warn that immediate tax increases or spending cuts could push the economy back into recession. Far better to pass a plan that phases in spending cuts or tax increases over time.

But if federal policy makers do decide to reduce the deficit immediately, reducing spending alone would probably be the most damaging to the recovery. Raising taxes for the wealthy would be least likely to reduce overall demand and raise unemployment.

The politics behind this issue is another matter. But it has huge implications for issues like education. Too many educational advocates, policy types, and yes, even elected leaders seem all too willing to accept "The New Normal" -- and even pontificate about it -- as opposed to fight for a new deal and attempt to redefine the debate. President Obama too often appears to allow congressional Republicans to define the terms of the conversation, such as tying long-term deficit reduction to the debt ceiling, as Robert Reich noted over Twitter yesterday.

There's a time and a place for acknowledging political realities and accepting half a loaf. The problem is we've entered the second coming of the Robber Barons where the rich are hoarding their loaves of bread and too many Americans aren't getting a chance to get their hands in the dough at all. Until we address the historic economic inequality in this country and put spending power back in the pockets of working families, there is a tremendous likelihood that the economy will never fully recover. Never. That requires us -- and our elected leaders -- to speak out and act.

The time is now. Reality is what we make it. More of us have got to be willing to step up and say, "Enough!" I've witnessed Democrats and independents get energized in Wisconsin. We need a similar dynamic to take hold nationally. My guess is that it will build in time. But will it be enough to change the equation?

The forces of fiscal lunacy had better listen to the American people now or my guess is that they'll be hearing from the silent majority of sensible Americans at the ballot boxes in 2012 -- and even sooner in states like Wisconsin. If the "Republican Revolution" in the 1990s is any signal, past is prologue.

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Fili-Bernie

I've officially given this blog over to Bernie Sanders. Well, not really. But I can't think of an issue more fundamental in defining who we are as Americans and more important to our nation's economic and educational future than what Bernie discussed in his old-school, non-filibuster filibuster on Friday. Economic justice -- along with sensible tax policy -- is something too few on Capitol Hill and too few Americans care to consider. But it's centrally related to the future educational outcomes of our people -- research shows that socioeconomic factors are more important even than teacher quality, a frequent topic of my posts and a central feature of my professional work.

I note that former Labor Secretary and current Berkeley professor Robert Reich, in his Twitter feed (@RBReich) today, backs up a point I made about these proposed tax cuts being a precursor to Republican efforts to launch an assault on domestic spending and entitlements -- using the federal budget deficit made so much worse by these tax cuts for millionaires and billionaires as their rationale.

I said: "I recognize that this issue isn't specifically about education, but it is inexorably linked. Given President Obama's apparent unwillingness to go to the mat for Democratic principles (and his own campaign pledge!), Republicans have succeeded in extending the Bush tax cuts for millionaires and billionaires -- not just for the first $250,000 or $1,000,000 of their income, but all of it up to infinity. The total cost of all the proposal's tax cuts is $900 billion. Republicans' likely next step is too take off their "tax cutter" hat and don their "deficit hawk" cap, saying that the federal government is living beyond its means, and will fire away at domestic spending. You don't think education will avoid being in their crosshairs at that time, do you? You know that this is more than simply a ploy to line the pockets of rich Americans, right? It's part of a plan to bleed government dry and then argue that government programs need to be reduced, eliminated or privatized."

Reich wrote: "$900 b tax cut w/ lion's share for rich explodes deficit and makes future domestic discretionary spending sitting duck for R cuts."

Yes, folks. This isn't just about tax cuts for the richest Americans. This is but a front in the war to reduce the size of government regardless of its collateral damage to Americans who need government the most.

Economic inequality is already at an all-time high in this country -- even higher than prior to the start of the Great Depression. Our educational system only has a finite amount of power to overcome such overwhelming inequities. If these forces are left unchecked, it may become an impossible job, especially as education programs themselves may fall victim to all-too-easily-predictable budget cuts.

The rich, on the the other hand, will continue to party like it's 1929. Only the party's even better this time 'round. So much for the national economy being a collective good.

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Bernie Sanders

Vermont's U.S. Senator Bernie Sanders is a hero for speaking truth to power, something he has been doing his entire life, regardless of whether it's been politically popular. He's one of the few public officials who has entered the U.S. Senate chamber and not become co-opted by it. Now, I may be biased as a former Vermonter who watched his rise from third-party also-ran to mayor of Burlington to U.S. congressman to U.S. senator. Bernie is genuine, he is forthright, perhaps a bit holier than thou at times. He is the real deal.

Check out his 13-minute speech on the floor of the U.S. Senate on November 30, 2010 providing a compelling and detailed analysis of historic economic inequality in America and the duplicity of Republicans talking woefully about the national debt and budget deficit one minute and pushing as their top priority tax breaks for millionaires and billionaires that would break the bank the next. Sanders is one of the few national leaders making any sense today and putting economic inequality and proposed tax breaks into historical context. It's probably because he is one of the few that actually cares.

On Saturday, we watched as Republicans voted in lockstep against two alternatives to extending the Bush-era tax cuts to all Americans regardless of income. One proposal would have extended tax cuts to all families first $250,000; another to all families' first million. Even millionaires and billionaires would have continued to enjoy lower taxes on some of their income. Alas, why should the rich settle for half a loaf?

Who else thinks that the current policy debate over tax policy in Washington is absolutely insane? Not enough of us. One who does is Noble Prize-winning economist Paul Krugman, who in the New York Times on December 3, 2010, laid much of the blame on President Obama:

It’s hard to escape the impression that Republicans have taken Mr. Obama’s measure — that they’re calling his bluff in the belief that he can be counted on to fold. And it’s also hard to escape the impression that they’re right.

Sad, but true.

I recognize that this issue isn't specifically about education, but it is inexorably linked. Given President Obama's apparent unwillingness to go to the mat for Democratic principles (and his own campaign pledge!), Republicans have succeeded in extending the Bush tax cuts for millionaires and billionaires -- not just for the first $250,000 or $1,000,000 of their income, but all of it up to infinity. The total cost of all the proposal's tax cuts is $900 billion. Republicans' likely next step is too take off their "tax cutter" hat and don their "deficit hawk" cap, saying that the federal government is living beyond its means, and will fire away at domestic spending. You don't think education will avoid being in their crosshairs at that time, do you? You know that this is more than simply a ploy to line the pockets of rich Americans, right? It's part of a plan to bleed government dry and then argue that government programs need to be reduced, eliminated or privatized. [UPDATE: The deal is a "budget buster." (The Atlantic)]

Now, there are would-be Democrats who are in denial and are not considering this likely outcome at all. Rather than reserving their scorn for Republican tax policy, they are attacking progressive Democrats and the likes of Bernie Sanders. Shame on them.

Over Thanksgiving weekend, the President suffered a split lip in a pick-up basketball game. How I wish he were as willing to put his body on the line for economic fairness as he was for a rebound!

I am encouraged that Senator Sanders has expressed a willingness to use the filibuster to put the breaks on extending tax cuts to the wealthiest Americans. God knows that Republicans have used the filibuster -- or the threat of one -- for dozens of nefarious purposes, including preventing extensions of unemployment insurance, regulation of Wall Street, and recently more rationale tax cut extension proposals. Imagine! A progressive willing to stand up for what's right and not "punt on third down," to use the words of New York Congressman Anthony Weiner.

At this time, I couldn't be more disappointed in President Obama. I have always been a political realist, voting for the "least bad" candidate when necessary, and a life-long Democrat. I honestly don't know what I might do in 2012. I literally couldn't sleep the other night, I was so angry. Maybe it's time to follow Robert Reich's lead and form a "Peoples' Party."

Rhetorically, President Obama is making the same mistake over and over again, putting bipartisanship ahead of smart public policy. I am not criticizing the President because I wrongly fancied him a liberal. Rolling back the Bush tax cuts for the wealthy was one of his chief campaign pledges for Chrissakes! I'm criticizing him on the substance of the issue, for walking away from a campaign promise (without fighting for it), and for making the same tactical mistake he made during the health care battle: working feverishly to assemble a bipartisan coalition for health care reform when there was no real willingness among Republicans to meet in the middle. In the current case, he horse-traded away a key campaign plank and agreed to an extension of the Bush tax cuts for two years plus deeper estate tax cuts, while only receiving a 13-month extension of unemployment benefits and one year of payroll tax cuts.

I'll give the New York Times the last word. In this morning's editorial, it writes:

President Obama’s deal with the Republicans to extend all the Bush-era income tax cuts is a win for the Republicans and their strategy of obstructionism and a disappointing retreat by the White House....

The Republicans gave up very little except for their unconscionable stance of holding up all other Congressional action until they ensured that the richest Americans keep their tax cuts.

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