Inflation Not Issue With Democrats’ Job And Revenue Generating Proposals

The news has lately been filled with stories about price increases from gasoline to beef. But just as many stories have been reported that airlines are selling tickets galore and sales are percolating at stores. This morning the lead story above the fold in The Wall Street Journal was titled Shoppers Increase Spending, Despite Inflation.

U.S. consumers withstood rising inflation to power a burst of shopping ahead of the holiday season, with big retailers reporting higher sales and expectations for a solid finish to the year.

Sales at U.S. retail stores, online sellers, and restaurants rose in October by a seasonally adjusted 1.7% from the previous month, the Commerce Department said.

While it is possible to track the reasons for inflation since the pandemic, the supply chain disruptions, and the unemployment numbers or as it has also been termed the “mass resignations’, it must be noted why we must not throw away the chance to advance our society with policies that have been long sought. We need to understand that these proposed initiatives are not inflation-inducing.

When it comes to the Build Back Better legislation some partisans who desire to undermine President Biden rather than listen to the strong support from the public, as polls show, have used the fear of inflation as their rhetorical tool. But the facts and logic are not on their side.

This week at the signing of the massive and much-needed infrastructure bill Republican Senator Rob Portman spoke words that did not make as much news coverage as they warranted. His message was clear. Investing in jobs and revenue-generating ideas is a path towards a strong US economy.

“It represents a long-term investment in our nation’s hard infrastructure assets that will create hundreds of thousands of jobs, and make us more efficient, more productive and more competitive against other countries like China. Importantly, economists agree that by investing over time in hard assets, it adds to the supply side of the economy, and will be counter-inflationary at a time of rising inflation. And it does all of this without raising taxes on the American economy as we are coming out of the pandemic. In contrast, the partisan tax and spend Build Back Better plan will increase inflation through massive stimulus spending and hurt the economy through massive tax increases.

While it is easy to locate the latest screed from the likes of GOP Senators Ted Cruz or Ron Johnson it obviously makes far more sense to listen to the words of economists and learned individuals. Such as Mark Zandi who for years has been read and heard in this nation about economic matters. He is now the chief economist of Moody’s Analytics.

The hair-on-fire discourse over high inflation is understandable, but it’s overdone. … My inflation outlook could be Pollyannish, but only if inflation expectations — what investors, businesses, consumers and economists think inflation will be in the future — rise. If there is a widespread view that inflation will remain high, workers will demand higher wages to compensate and businesses will ante up, believing they can pass along their higher costs to their customers. This vicious wage-price spiral was behind the persistently high inflation we suffered 30 years ago. But there is no evidence that this is happening today.

All of this refutes the notion that the government spending and tax breaks to support the economy through the pandemic, including the American Rescue Plan this past March, are somehow behind the higher inflation. These factors certainly gave a boost to demand last spring, but that faded when the Delta variant gained momentum this fall. There is also no good way to connect the dots between the Build Back Better agenda, which is currently being debated in Congress, and higher inflation. The legislation provides support for public infrastructure and various social programs, and longer term, it is designed to lift the economy’s growth potential, which will ease inflationary pressures.

The fact is that inflation fears are being used by Republicans to confuse a certain segment of the nation and undermine the sitting president. They are not interested in, or understanding of the popular support for housing programs, climate-change policies, and a plethora of other matters contained in the Build Back Better legislation.

Fear may get them a headline now, but the nation is deserving of progress that history will long record.

And so it goes.

Compromise In Washington Makes Stronger Bridges, Better Roads, Ports Near You

We know what happens when partisan gridlock ties up the governing process making Washington mostly useful as the tool for nighttime comedy writers.

But what happened when 19 Republican Senators joined the majority, or when 13 House Republicans linked votes with their Democratic colleagues on the same congressional bill?

On Monday President Joe Biden signed a truly impressive legislative measure to address infrastructure concerns in the nation. The $1 trillion bipartisan infrastructure bill matters for more than just needed physical improvements. Let me explain.

As a result of Congress earlier this year, and correctly so, pumping over a trillion dollars into the economy due to the pandemic, it might seem massive funding amounts are commonplace in headlines. While that is true, the significance of the new legislation and the dollars pumped into states and communities should not be overlooked. The infrastructure projects will impact each and every American.

There is the essential $110 billion to be spent on roads, bridges, and other major transportation projects. With the President’s signature, $66 billion in freight and passenger rail will be updated. It will direct $39 billion into public transit systems, which will assist local urban centers, such as Madison and Sun Prairie.

This blog has commented on the absolute need for expanding broadband, especially following the educational debacle in some parts of the nation that occurred with long-distance education due to COVID. So I am very pleased with the $65 billion into expanding broadband.

The reason we can applaud these items listed here, and a plethora of others in the measure, is due to the ability of members from both parties to move forward with the primary reason they were sent to Washington. To do the work of the public.

Over the many years when voters were asked what angers them about government, the primary reason can be summed up that the failure to compromise and get bills passed that impacts ‘the folks back home’ is the one that most rankles. 

The all-out ultra-partisanship has been building for decades, and this one glimmer of bipartisanship being sealed into a final package will not allow for everyone to see the light. To feel the art of the possible.

But to not stop and recognize the positive impact of working together on this measure will only allow the continuing rancor that consumes Washington to have won another day.

I can just see some conservative candidates challenge Republican incumbents who stood up and decided that government should act for better roads and bridges. How dare a member of the GOP work with the majority party! We have come to a place in our tribal politics when infrastructure is now viewed, by some, as Red or Blue. It was not so long ago that infrastructure bills were just common-sense measures where every state and congressional district proved to be lifted up and improved.

Every district will win with this funding measure too, but many of the Congressional Republicans will carp for their partisan ends. That is a sad place where our nation has landed.

For the rest of us, therefore, it is important to grasp the value of compromise and bipartisanship. We can see the fruit of such work.

And in the future, we will feel it too as we ride on smoother roads and walk through improved airports.

And so it goes.

Means-Testing Child Tax Credit Should Be Avoided In Congressional Bill

The debate about means-testing for eligibility in government programs is back as Congress presses down to craft a Build Back Better bill that can pass by month’s end. In a never-ending series of demands from the likes of Senator Joe Manchin the troubling threshold of which person can be aided by government services, and who can not, is again up for discussion.

I recall when Wisconsin Governor Tommy Thompson was working on welfare reform. One of the salient points that Democrats in the legislature continuously made was if a person who was receiving benefits was cut off due to an income cap, that once it was reached the real possibility existed that the recipient would then fall backward and the cycle of problems would restart. The loss of that program, or the lack of it continuing, could be very important to the individual until a more solid footing is attained.

If I were to sum up my concern about the ongoing debate in the Senate about meana-testing it would come back to the one this state had in the late 1980s. Do we fashion a policy to work or one that is politically created for the ones who continually disdain allowing government to work?

I am sure data must exist showing to what degree the anxiety over receiving governmental programs is so high that a person never seeks it. I also suspect the means-testing argument is often a shame-inducing component for some to not be viewed as ‘poor’ or ‘needy’ and not then ask for assistance.

The use of political rhetoric, and the damage it has created on this issue can be summed up by knowing that public schools, which are championed as essential are not subjected to means-testing. The power base and political muscle from the unions are well known. As they should be.

But not for the social assistance programs that assist those who have no megaphones or powerful lobbyists.

It is that last point that needs to be considered when knowing how Manchin’s demand for means-testing the child tax credit—a credit that is a major legislative undertaking this year—points out the divide between the party’s ideals and the ones who discard them so readily. Data proves why the credit is needed, and how it can lift people out of poverty.

The reason we all can, and should, make the claim for strengthening the foundation of families is based on data. Researchers at Columbia University’s Center on Poverty and Social Policy are estimating that Biden’s new credit will cut childhood poverty by 45%. The IRS has estimated that 39 million families and 65 million children will benefit under this plan.

One would think that a senator from West Virginia would be more clued into poverty. And desirous of breaking that chain of generational lack of hope.

And so it goes.

Support Is Strong For Robust Spending Plans Of President Biden And Democrats

Watching the legislative process play out in the halls of Congress can be vexing for many Americans. This summer the much-needed infrastructure bill, and the meaty Build Back Better bill, aimed at addressing a plethora of national concerns, have made headlines.

And angst.

The political rhetoric has been heavy and the headlines at times can make it seem the bill is too massive to make it over the line so as to have a presidential signature. While it was inevitable the original $3.5 trillion proposal was to be trimmed in the budgeting process doesn’t mean the goals outlined by this White House misalign with the desires of the public.

I have been following the polling data from West Virginia where Democratic Senator Joe Manchin, who enjoys being a power player rather than a policy wonk, seems not to be squared with his own constituents. It is clear that when one starts to look at the various components of the large spending proposal put forth by President Biden there is strong support.

When the nonpartisan nonprofit WorkMoney surveyed more than 50,000 of its 2 million members nationwide, it found 81% of respondents said they supported this plan. That includes 90% of liberals who took the survey, 81% of moderates and 66% of conservatives.

Conservative backing appears even more robust in West Virginia, home of Manchin, a moderate Democrat who is one of the critical holdouts on the budget bill and whose efforts could derail the entire plan – or see large chunks of it scrapped as he balks at the budget’s price tag.

But according to the survey, 80% of more than 800 people surveyed in his home state believe he should vote to pass the bill. That includes 77% of conservatives who responded to the survey.

The colossal spin machine from right wing-media, which starts with Fox and Friends in the morning, continues on angry conservative talk radio all day, and then veers into the absurd with the Fox News’ talking heads at night would make it seem no one wants the spending for Biden’s programs.

But that is not true, as outlined in a Wall Street Journal story.

Several recent polls, bolstered by interviews with more than 50 Democratic voters across six swing states in recent weeks, indicate broad party support for legislation to expand social safety net programs and pass measures aimed at mitigating the effects of climate change.

Democratic leaders have proposed paying for well over a trillion dollars in expanded government services, in part, by higher taxes. Top Democrats acknowledge that would have been considered too liberal a few years ago but say that it now has broad party support. At least one Democrat in the Senate has voiced opposition to the idea.

Most of the Democratic voters interviewed said they believed that if their elected leaders didn’t act on the most ambitious legislation possible, the party risked losing congressional seats in next year’s midterm elections and the White House in 2024.

A CNN poll released last week found that 75% of Democrats preferred a bill that included all of the social safety net and climate-change provisions proposed by Mr. Biden. Another 20% of respondents backed a scaled-back bill that costs less. A Pew Research Center poll released in late September similarly found that among those who identify as Democrats or lean Democratic, 75% said they favored Mr. Biden’s initial $3.5 trillion package.

I will be the first to admit that messaging has been the weak link when it comes to the Biden White House and the needs that are addressed in this large budget bill. The public knows, however, there needs to be a transformational way we address climate change, pay for education, and update our transit systems.

The public may not speak about these matters in the phrasing found here but they are most aware of failing bridges, not enough cash to send their kids to college, and way too few daycare options for working mothers. This all may seem like a large partisan game to Republicans but to the people who deal with these and other problems each day around the nation, this bill is a hope for their future.

I support the bill and I will gladly pay for the means of making sure the nation can be lifted up with the programs which are contained in the final draft. A large portion of my fellow citizens agree. Polls underscore that fact.

We have put off for far too long the policy moves that must occur now.

And so it goes.

 

Lead Pipe Mediation In Reconciliation Bill Important, Arkansas And Wisconsin Children Prove Point

The reality of how numbers need to be squared and lowered so as to gain passage of a smaller reconciliation bill is prompting new scrutiny for policies that truly do require funding. One of the bottom lines in the congressional discussions must be lead pipe mediation.

Today I ran across a figure that underscores the contention among many that lead pipes must be remedied in this nation. Two-thirds of Arkansas children under age 6 had detectable lead levels in their blood. That was a finding in a new study from JAMA Pediatrics.

That is not acceptable. No way. No how.

While one can make a very strong argument showing that the Arkansas government has not acted with resolve to address this issue or tax their residents so as to have the funds to install new pipes it also goes without saying children should not be held hostage to conservative politicians.

The data shows that children from communities with pre-1950s housing or high poverty rates are most impacted. Science shows that a blood lead concentration as low as five micrograms per deciliter can affect the long-term cognitive development of children. That can then lead to lifelong learning disabilities and behavioral problems.

Those then are costs that are often left to governments to address, and taxpayers to fund.

So once again, it is imperative to address the problems on the front side as the preventive route is always cheaper and more appropriate than picking up the pieces later.

It has been troubling to see some members of Congress pretend that federal resolve must not be used to address issues such as lead pipe mediation. Senator Joe Manchin should be front and center as his poor state has an estimated 20,000 citizens who have lead service lines throughout West Virginia.

The Senate has passed–and correctly so– a much-needed bipartisan infrastructure package that would allocate $1.5 billion to replace lead service lines. Democrats hope to pass a budget reconciliation bill with even more funds to meet the need.

The problem is, of course not just in states with lower economic stats, but also in places Wisconsin.

The City of Racine had just under 11,000 lead pipe service lines delivering water to its nearly 80,000 residents in July, when the city announced it had received a $1.6 million grant through the state’s Safe Drinking Water Loans program.

2015 report by the Wisconsin Department of Health Services reported statewide tests on children showed the percentage with elevated blood lead levels was 4.6%. That same report found the percentage in the jurisdiction of the City of Racine Public Health Department was 9% for 1-year-olds and 10.2% for 2-year-olds.

Many will argue we can not do everything now that needs to be accomplished. That is true. But we can do what must be done to protect children who rely on adults to make sound decisions.

And so it goes.

The Trillion Dollar Coin? Thanks to Sen. Mitch McConnell and Conservatives….

I have been following the developments of the debt ceiling crisis and find the latest potential remedy something akin to a plot from a Robert Ludlum novel.

One ‘potential remedy’ to the dysfunctional political climate is to have the U.S. Mint strike a $1 trillion platinum coin. It would be minted within minutes at West Point and could be physically deposited at the New York Fed, that’s only a short helicopter ride away.

The Fed, once given the coin, would credit Treasury’s account with $1 trillion that would not count towards the national debt.

As I said, straight out of a Ludlum book.

The Washington Post writes this idea has been rejected.

As part of their internal review, White House officials have circulated internal memos with a range of untested theories should Congress fail to resolve the debt ceiling standoff, including the creation of a $1 trillion “coin” idea that has been popular among some liberals for years, the people said. But these options have been set aside as unworkable, the people said.

In the United States, Congress authorizes spending and sets taxing levels, and then separately sets a limit on how much the country can borrow. While Republicans like to spew over the debt ceiling matter, facts show Republican presidents have piled on more debt in the past 60 years than Democrats. They need to be responsible and increase the debt limit this week.

And the GOP should not think they are going to get some charm bracelet of goodies for simply doing their jobs! That behavior on the part of the conservatives will no longer be tolerated. Republicans need to get their hands dirty, too, and face up to the fiscal reality of the bills they have already passed. Like the moronic Trump tax bill that was an obscene giveaway to the wealthy.

Let us not mince words. A lack of increasing the debt limit would be a dramatic problem for the country! The international repercussions would send us into a recession.

So, would the government possibly consider the idea of a minted coin to stop the wreckage of the economy? Regardless of what has been stated thus far when the topic has been raised?

Paul Krugman wrote over the days in The New York Times his support for the idea.

Well, there’s a strange provision in U.S. law that empowers the Treasury secretary to mint and issue platinum coins in any quantity and denomination she chooses. Presumably the purpose of this provision was to allow the creation of coins celebrating people or events. But the language doesn’t say that. So on the face of it, Janet Yellen could mint a platinum coin with a face value of $1 trillion — no, it needn’t include $1 trillion worth of platinum — deposit it at the Federal Reserve and draw on that account to keep paying the government’s bills without borrowing.

Alternatively, Biden could simply declare that the 14th Amendment to the Constitution, which says that the validity of federal debt may not be questioned, renders the debt ceiling moot.

And there may be other tricks I don’t know about.

Would any of these approaches basically mean using silly gimmicks to avoid catastrophe? Possibly yes. But given the stakes, who cares if the approach sounds silly?

As for the thoughts of this blogger….well, the coin sounds supercharged with political and legal pitfalls. So perhaps we need to just pull the heads of the GOP from wherever and have them face facts.

Raising the debt limit has no direct impact on the size of the national debt. It has no impact either for more spending or freezing or restricting spending. The only thing that increasing the debt limit does is pay expenses previously authorized by presidents and Congress.

And so it goes.

List Of GOP Presidents And The Debt Ceiling Facts

Let’s be honest about what is happening in Washington regarding the debt ceiling.

Republican Senate Majority Leader Mitch McConnell and the entire GOP caucus are desiring to threaten the United States economy by not only refusing to increase the debt limit, but denying through a procedural method the Democrats from being able to vote for it.

The dangers of not increasing the debt limit have been written about often as of late. I have made it clear that the Republicans should not be able to hold the economy hostage during the increase process, so to extract something for just doing their jobs.

The absolute blarney that McConnell is spreading about why the Republicans are pouting in the sandbox makes us more aware of what he wishes the public not to know. Or recall.

The fact is that the majority of this country’s debt was incurred by Republican presidents. That is not my writing a partisan line, but rather one of those pesky facts Republicans wish to forget. The national debt is all those deficits accumulated, minus whatever we have paid off, regardless of which party the debt accumulated under. In other words, the GOP needs to act like adults.

Here then are the numbers…..the facts...from over the decades.

Lyndon Baines Johnson (D)
     Assumed office November 1963: $5 billion deficit
     Left office January 1969: $3 billion surplus
     Decreased deficit by $8 billion
Richard Nixon (R)
     Assumed office January 1969: $3 billion surplus
     Left office August 1974: $6 billion deficit
     Increased deficit by $9 billion
Gerald Ford (R)
     Assumed office August 1974: $6 billion deficit
     Left office January 1977: $54 billion deficit
     Increased deficit by $48 billion
Jimmy Carter (D)
     Assumed office January 1977: $54 billion deficit
     Left office January 1981: $79 billion deficit
     Increased deficit by $25 billion
Ronald Reagan (R)
     Assumed office January 1981: $79 billion deficit
     Left office January 1989: $153 billion deficit
     Increased deficit by $74 billion
George H.W Bush (R)
     Assumed office January 1989: $153 billion deficit
     Left office January 1993: $255 billion deficit
     Increased deficit by $102 billion
Bill Clinton (D)
     Assumed office January 1993: $255 billion deficit
     Left office January 2001: $128 billion surplus
     Decreased deficit by $383 billion
George W. Bush (R)
     Assumed office January 2001: $128 billion surplus
     Left office January 2009: $1.4 trillion deficit
     Increased deficit by $1.5 trillion
Barack Obama (D)
     Assumed office January 2009: $1.4 trillion deficit
     Left office January 2017: $665 billion deficit
     Decreased deficit by $735 billion
Donald Trump (R)
     Assumed office January 2017: $665 billion deficit
     Left office January 2020: $3.7 trillion deficit
     Increased deficit by $3 trillion

As the data proves from over the past nearly 60 years only Democratic President Jimmy Carter had a larger budget deficit in his last year in office than he inherited from his predecessor. Please note that all six Republican presidents had larger deficits in their last budgets than they were handed at the start of their term.

In other words, Republicans love to spend taxpayer money and then deny what they did in office in relation to spending. What is harmful at times like this, when debt ceiling action is required, is too many gullible voters have swallowed the GOP rhetoric that this is all somehow the fault of Democrats.

Such attempts from Republicans are simply factually wrong.

And so it goes.

Democrats Give Nation Lesson In Governing As Reconciliation Bill Makes Progress

There are probably a few Democrats on Capitol Hill singing a little ditty under their breath today as they move down hallways for another meeting on the reconciliation bill.

“I’ve got sunshine on a cloudy day”

The reason for a bounce in their step has to do with both Senator Joe Manchin and Congresswoman Pramila Jayapal doing what this blog recommended last week.

Act pragmatically.

Last week Manchin was stating his top line for the package was $1.5 trillion. But now he has compromised…this is how such large measures are constructed in Washington. He now states being agreeable to a higher amount. His range now is between $1.9 – $2.2 trillion.

On the House side Jayapal, the leader of the Congressional Progressive Caucus, suggested the party could unite behind a $2.5 trillion package. The most important part of this new development on both sides is the recognition that compromise is moving in both directions.

However, if one listens to the far-right talk shows or tune into FOX News during the angry prime time hours it would seem that compromise equals capitulation. 

It does not.

History shows that compromise is often needed in the most dire of times. Given the emotion and desires of various factions, compromise is always very difficult to achieve. That it is imperative at critical times to reach a deal should not be news to anyone. Yet sadly, compromise or even talk of it, (such as over the past two weeks) has led to some needlessly tense conversations and wounded relationships in D.C.

At times like this, I reflect on other moments in our national story where compromise was required to get the larger needs met.

As the Constitutional Convention was proceeding  Ben Franklin often looked at the president’s chair and saw the image of the sun that was painted upon it.  After the proceedings were complete he remarked to other colleagues that he had wondered if the sun was rising or setting on the chair, and felt with the completion of the work that it was indeed rising.

That is how I feel at this time, too. Though there is much work remaining until President Joe Biden signs the various legislation.

I just know that a significant and purposeful reconciliation bill will be drafted and passed in this Congress, along with the much-needed infrastructure bill. Democrats will also ensure that the debt ceiling is increased.

In achieving all these things the nation will have witnessed how governing happens even when all the parties are not initially aligned. Crafting a massive piece of legislation is always a process that is messy and makes some uncomfortable in Middle America. This civics lesson is as important to the needs of the nation right now as are the final bills.

Maybe even the Republicans will learn something.

And so it goes.