Romney Campaign Walks Back “Moderation”

Romney CaresThis is brilliant. While all the pundits can’t get enough of how Romney transformed himself, the Romney campaign is quietly going back on all of his “moderation.” You may recall that Romney claimed that his healthcare plan would cover people with pre-existing conditions. Obama countered that this wasn’t part of his plan—all he was doing was keeping the pre-ACA law that said as long as you keep continuous coverage, insurance companies cannot drop you. Romney claimed this wasn’t the truth and that his plan did cover the 89 million people with pre-existing conditions who couldn’t get coverage. This was part of Romney’s Santa Claus act where anything popular: it’s in there!

And then the debate ended and Romney’s people had to “clarify.” That’s Republican for “correct a lie.” Talking Points Memo reports that Romney’s top adviser Eric Fehrnstrom said:

With respect to pre-existing conditions, what Governor Romney has said is for those with continuous coverage, he would continue to make sure that they receive their coverage.

This is exactly what Obama said. Romney has no plan.

Will this matter? Probably not. Content doesn’t matter. Romney was aggressive and he “moderated” his position (In public anyway!) so he won. But despite all the claims to the contrary, Romney is the same as he ever was. And Obama lost the debate by allowing him to spout his endless parade of lies without counter.

Update (4 October 2012 9:13 am)

Josh Barro—who I’ve had no lack of bad things to say about—has an excellent discussion of the debate. He notes the main problem:

Obama needed to keep up that attack all night, and he could have. Whenever the president discussed an aspect of his policies that was popular, Romney said he supported that, too. Romney said he likes the good parts of Obamacare and the good parts of Dodd-Frank. Whenever Obama raised a negative aspect of Romney’s tax plan, Romney simply insisted that his plan just isn’t so.

In other words, Romney was shaking the etch-a-sketch. He was vulnerable to the critique that he is changing his views to match audience desires and therefore can’t be trusted. But Obama mostly failed to make that point.

…

There is one big silver lining for Obama: The debates usually don’t do a lot to change how people vote. When they do matter, as with Gerald Ford in 1976, it’s usually because of a major blunder, not a broadly weak performance. Obama did himself no favors tonight, but his weakness probably had little impact on the number of votes he will receive.

Update (4 October 2012 9:32 am)

Jonathan Chait discusses another of Romney’s lies: he won’t lower taxes on the rich.

None of these studies back up Romney’s claim that he won’t reduce taxes on the rich. They confirm that he will reduce taxes on the rich. They merely suggest that he could make up the revenue some other way than taxing the middle class or increasing the deficit—that the economic growth will help the tax cuts for the rich pay for themselves, or that some of the lost revenue can be made up for by cutting off subsidies for the uninsured. Romney flat-out misstated his position.

I haven’t see an explicit walk back from his campaign, but his plan has not changed. Chait goes on to make a very keen observation of why Obama did so poorly:

Romney won the debate in no small part because he adopted a policy of simply lying about his policies. Probably the best way to understand Obama’s listless performance is that he was prepared to debate the claims Romney has been making for the entire campaign, and Romney switched up and started making different and utterly bogus ones. Obama, perhaps, was not prepared for that, and he certainly didn’t think quickly enough on his feet to adjust to it.

Update (4 October 2012 10:54 am)

Think Progress has even more walks back from the Romney campaign:

From Michael Grunwald, author of The New New Deal: The Hidden History of Change in the Obama Era:

ICYMI: Romney campaign told me (after my tweet-rants) Mitt didn’t mean to say half the #stimulus-funded green firms failed. Probably <1% so far.

Grunwald estimates that less than 1 percent of green firms have gone bad in terms of dollar value.

Romney also singled out Tesla Motors, which designs and manufactures electric vehicles, and received a $465 million loan from the Department of Energy. Last night, he quipped, “I had a friend who said you don’t just pick the winners and losers, you pick the losers, all right?” But the company is not a loser. “Founder Elon Musk says it will accelerate its payment of the principal in the spring—and the Department of Energy isn’t complaining it’s not getting its money back.” Romney, unfortunately, has turned to rooting against an American company in his effort to unseat Obama.

Republicans hate America.

Update (4 October 2012 11:03 am)

More from Kevin Drum.

Right Wing Lies About Libyan Attack

Fox NewsIt’s hard to keep up on what’s happening in the conservative media echo chamber. Sure, I here this and that. I even occasionally read articles in the National Review, although these tend toward the most reasonable of the conservative commentators. I’ve only been vaguely aware of the push of Darrell Issa’s call for an investigation of the terrorist attacks on the embassy in Libya. It is all so exhausting. Don’t these people have real work to do? Is their entire reason for life to stand around waiting for a thread they can grab onto that will cause the entire administration to unravel?

Don’t answer that. I already know: their entire reason for life is exactly this. And although they were different people, this is what their doppelgangers did during the Clinton administration. It is pathetic. I guess the idea is that they aren’t going to do any work until they’re in power. Until then, they will only do things that might help them get into power. I really worry about this country.

The deceptions regarding this made up scandal are even bigger than I had though. Thankfully, Liberal Viewer does the dangerous work of actually watching Fox News. And as usual, he’s great. You really should subscribe to his channel.

New Romney Tax Plan: “Trust Me!” Pt. 2

Mitt RomneyI am so tired of Mitt Romney, but I’ve got to write about this. The Serious Set are all a titter about Romney’s announcement that he is going to cap deductions at $17,000. I don’t know exactly what this will do to middle class income taxes. But this is more or less the same old song: Romney wants to change federal income taxes such that the top 1% will save huge amounts of money. He would prefer to make the middle class pay for this, but it is politically untenable. So instead, he plans to make the upper class (minus the 1%) pay for it.

This is the main way that Romney has countered the Tax Policy Center study. The claim is, “We don’t have to raise taxes on the middle class; instead, we can decimate the well off making between $100,000 and $200,000.” I don’t cry a lot of tears for this group of people, but it is clearly wrong to screw them for the sake of the 1% who, to put it mildly, have done really well by the tax code.

But this fact doesn’t seem to bother Ezra Klein, who tweeted:

In general, I like the direction Romney is going here. Capping deductions seems more achievable than picking through them one by one.

But if you actually read Ezra Klein’s column on it, it is just a bunch of questions. And it ends in a way that—to me—is a big “Fuck you!” to the Romney campaign:

That’s a promising approach. The question now is whether we get more details from the Romney campaign, or whether they’re just trying to throw something out there so they have something vaguely plausible sounding to say when pressed for tax specifics during the first presidential debate. I asked the Romney campaign for more details and spokeswoman Andrea Saul sent this back:

Governor Romney’s tax reform plan will jumpstart economic growth, cut the tax burden on the middle-class, and lower tax rates across-the-board. He will pursue revenue and distributional-neutrality in reforming the tax code. There are a range of policy options, Gov. Romney referenced one illustrative example, to achieve these goals.

In other words, “I contacted the Romney campaign and they provided me with the usual bullshit: trust me!”

We get the same thing from Josh Barro. But more so. Barro is very impressed with Romney’s new direction. But when he gets down to the specifics, he’s even more skeptical. His point 6 is particularly telling:

Any plan that keeps Romney’s promises on cutting rates 20 percent and holding the middle class harmless has to sacrifice revenue neutrality, and I expect this plan will fall far short of raising the roughly $5 trillion over 10 years that is needed to offset Romney’s tax rate cuts.

In other words: it’s bullshit, but I’m a conservative so, “Yea!”

Note the timing of this announcement: just before the debate. This is so it will be out long enough to sound credible during the debate but not long enough for the Tax Policy Center to analyze it and show that it is just as bad as his previous proposals.

Update (3 October 2012 1:31 pm)

Over at WonkBlog, they are very interested in this topic—big surprise. Suzy Khimm has written an article, Who’s likely to be hit by Romney’s deduction cap? The rich and middle-class urbanites. It notes that 25% of the mortgage interest deduction goes to the 1%. This is shockingly high, but it doesn’t counter my point. What I’m talking about is that Romney will not get rid of the low “any investment is capital improvement” capital gains rate, nor will he even get rid of the “carried interest” loophole. This is what makes the income tax system so dysfunctional (even though it is payroll taxes that are the most unjust of the federal taxes).

In addition, Khimm talks to Roberton Williams, who is a senior fellow at the Tax Policy Center. She continues:

But Williams points out that a $17,000 itemized deduction cap is also likely to punish middle-class taxpayers who live in areas where home prices and/or state and local taxes tend to be high—namely, urban areas of California, the New York metro area, other parts of the Northeast, and the Washington, D.C. metro area. For example, the owner of a $450,000 house with a 4 percent interest rate on a 30-year mortgage would already be qualified for a $18,000 mortgage interest deduction, Williams points out.

I doubt Romney planned that, but it works out well for him: screw the people who won’t vote for Romney anyway.

Also at WonkBlog, Dylan Matthews writes, Mitt Romney wants to cap tax deductions. Here are five ways to do it. The problem with this is that it gives Romney credit and help that he doesn’t deserve. He’s not serious about this proposal. As his campaign has been very clear about, this is just an “illustrative example.” In other words: don’t worry your pretty little heads about it, when the time comes we’ll make something work.

Just for the record, I know how they will make it work. They will give those 20% tax breaks. And the debt will increase. But it won’t matter, because Republicans will be in the White House. The deficit only matters if a Democrat is in power.

Penis Sizes Shrinking!

Rush Limbaugh

I’ll just come right out and say it: it is hard to talk about penises without a lot of unintentional puns. See what I mean? And frankly, I don’t like the whole subject. I don’t like biology; I find it disgusting. But that doesn’t mean I don’t think about it all the time.

This morning, I wrote the following poem:

Every time I defecate
I think of Charles Darwin
I wonder how an enzyme
Went on to create Carmen.

Clearly, I am a weakling. Human biology makes me run and hide.

The Incredible Shrinking Penis

Luckily, we have strong men to look out for the health of the species. Jessica Valenti tells the story:

Rush Limbaugh is worried about penises. Specifically, he’s concerned that feminists (I’m sorry, “feminazis”) have contributed to decreasing penis size. Responding to an Italian study that reports penises are 10 percent smaller than they were fifty years ago, last week Limbaugh pointed to feminism, feminazis, and “chickification” as the cause.

Ladies, the cat is out of the bag. Our cover of fighting for equal social, political, and economic opportunities for women has been blown. The phallus has always been the centerpiece — and the target — of all feminist thought. The upside is that we can finally be open about our true agenda: A small dick on every man. (‘Cause who likes a big one, amirite?!)

Study Problems

Apparently, Limbaugh gets his science from ChaCha.com, in a little feature they call Weirdest Scientific Discoveries, but which I’m calling, “Shit they just made up because they were on deadline and most weird scientific discoveries do not involve penises.” They link to no paper, but they do claim, “Male genitalia are roughly 10 percent smaller today than they were 50 years ago.” [Emphasis in original!]

It makes me think. What if there really is such a study? Was it longitudinal? (I kill myself!) Did they really measure penises the same 50 years ago as they do now? Aren’t men more likely to allow their penises to be measured now? And maybe men are just fatter now and it only appears that their penises have shrunk. So many questions! So much conjecture! Ain’t science grand?

Regardless, Jessica Valenti has a theory about the winky shrinky: it’s all the tofu you girls are forcing us to eat. Could be. I’m sure Rush is on the case.

Afterword

To make up for this article, Julia Migenes as Carmen:

I feel better. But I can’t speak for my penis.

Update (1 October 2012 11:39—Yes, I need to fix my posting dates!)

File this under “Why the world is fucked up!” I just checked Julia Migenes on Twitter and she has only 14 followers. Of course, this may have something to do with the fact that she has never tweeted. But her picture is there, so it must be her. She has a nice website though.


Rush Limbaugh by DonkeyHotey under CC BY 2.0.

We’ve Been Sacrificing for Decades

Frank BruniSteve M at No More Mister Nice Blog writes Is Frank Bruni Now the Worst Op-Ed Columnist at the New York Times? He starts by noting that the competition is fierce: David Brooks, Ross Douthat, Tom Friedman. Frank Bruni has mostly been off my radar, but I do remember he’s annoyed me a few times recently.

Steve M’s problem is that Frank Bruni claims that what we really need to see in Wednesday’s debate is the two candidates talking about the need for sacrifice:

In a few days, as you may have heard, Barack Obama and Mitt Romney will go head-to-head in their first presidential debate. What I most want from it isn’t fireworks, though I’m as big a fan of political theater as the next hack. It’s a word, one that has gone sadly out of vogue over recent decades and been mostly absent from this campaign.

Sacrifice.

And I’m not holding my breath.

Steve M goes on the highlight the hypocrisy of this. As I’ve noted in the past, pundits like Bruni usually believe just what is best for themselves, so this comes as no surprise. Steve M also talks about Bruni’s false equivalence. Again: no surprise. Why would the New York Times make a columnist out of a restaurant critic unless he was also going to spout the nonsense of the elite? I recommend reading Steve M’s whole article.

I would just like to add a bit to the conversation. The poorer 90% of the country have not just sacrificed over the last 4 years. They’ve sacrificed over the last 35 years. These are the years during which productivity has gone way up while workers’ salaries have stagnated. Winner-Take-All Politics presents work by Richistan and Broadland that show that if productivity gains had been shared equally from 1979 through 2006, the bottom 90% would be making roughly $10,000 more per year while those in the top 1% would be making almost $700,000 less.

Note that this doesn’t assume that every person would get the same amount in extra money. It assumes that the people at the top would get their normal (for the post-WWII period) higher share of the rewards of productivity increases. So these numbers go to show just how distorted the economic system has been made through various governmental policies.

I bring this up, because I want people to understand that the suffering and sacrifice of the middle and lower classes have been going on for a long time. They aren’t the result of our current economic troubles, but rather our policies. And we need to do something about that.

Incoming: Romney Zingers

ZingersAccording to the New York Times, Romney has been memorizing “zingers” since August. They will be his secret weapon at the debates.

Is this absurd? I don’t know. Ezra Klein tweeted last night, “Who would bet a campaign on Mitt Romney’s sense of comic timing?” The obvious response is: Mitt Romney! This is not a guy who has shown himself to be shrewd in a political sense. His campaign up to now boils down to, “The economy is bad and it is Obama’s fault; look at my strong jaw—it tells you I am the one to fix the economy!” At this point, his campaign (along with most of the conservative establishment) seems to think the problem is that he is not likable enough. Therefore, like a mother might tell her unpopular son, “Tell some jokes. People like jokes.”

There’s a history of this. Remember the 1988 debate between George Bush Sr. and Michael Dukakis?

Dukakis: He wants to give the wealthiest taxpayers in this country a five-year, $40-billion tax break and he also wants to spend a lot of money on additional programs. If he keeps this up he’s going to be the Joe Isuzu of American politics.

Bush: Is this the time to unleash our one-liners? That answer was about as clear as Boston Harbor.

These guys kill me! Who would have thought two politicians could hire such good comedy writers? It’s just hilarious. Wait! I’ve got to wipe the tears from my eyes. Oh, baby!

There is something interesting in that transcript: Bush Sr. wanted to cut taxes on the rich. And then Bush Jr. did the same thing. And now Romney wants to do it. Now that’s funny! I’m sure that Romney will have similar zingers; things like: “I’m going to lower taxes across the board and it will be revenue neutral.” Brilliant! “I’m going to increase military spending and it will be revenue neutral.” Outstanding! “I’m going to raise taxes on those 47% moochers and pay off the debt.” Stop! Stop! You’re killing me!

Unfortunately, I think what the Romney campaign means things like this:

Obama: We need to preserve the mortgage interest deduction.

Romney: Your mama is so fat, when she sits around the house, she sits around the house!

Obama: I support reproductive rights.

Romney: Take Michelle Obama… Please!

Obama: I wouldn’t be a very good president if I didn’t care about 100% of the people, now would I?

Romney: Hair lip![1]

I fear the debate will not be so good.


[1] Some people don’t get this. But it’s brilliant. Really! It is based upon an old joke:

A boy lost his eye. He didn’t have enough money to get a glass eye, so he bought a cheap wooden eye. He was very insecure about this and so almost never went out in public.

Eventually, his best friend got him to come out to a dance. But the man just stood quietly against the wall the whole night. His friend went up to him and pointed to a girl. “Why don’t you ask her to dance?” his friend asked.

“No,” then boy said. “She’ll make fun of my wooden eye.”

“No she won’t,” his friend countered. “She has a hairlip herself.”

So reluctantly, the boy went up to to girl and asked her, “Would you like to dance?”

The girl was thrilled. “Would I?” she exclaimed.

“Hairlip!” the boy said angrily and walked away.

The Oogieloves in the Big Balloon Adventure

The Oogieloves in the Big Balloon AdventureHave you heard about The Oogieloves in the Big Balloon Adventure? It is a feature film produced for toddlers. But the reason people are talking about it is that after $20 million in production and $40 million in marketing, Oogieloves had the worst opening weekend in film history—making less than a half million dollars on over 2000 screens.

Grady Smith was on On the Media today. That’s how I learned about the film that opened at the end of August. He seems to be confused about the movie. On the one hand, as a writer for Entertainment Weekly, he’s only supposed to care about how much a film makes. On the other hand, a film with this kind of dismal performance has got to be “interesting.” We’re talking about Ed Wood territory here!

He even admits to this. In his second article about the film in Entertainment Weekly, he admitted that he hadn’t seen the film. “But I sort of want to. Somehow, the film earning that dubious distinction has unleashed an alarming obsession within me for all things Oogieloves in the last 24 hours.”

By the time he was interviewed by On the Media, he had seen the film:

It is so many levels higher on the demented scale than I could have imagined. There is this pillow that only speaks in his own pillow dialect, there are magical balloons, there is a vacuum cleaner named J. Edgar. It is so colorful and the songs are so weird and you are forced to say “Goofy Toofie, pick you your pants!” a myriad of times. I wasn’t ever expecting something that weird.

It is not clear whether he means this in a good or bad way. I suspect that he doesn’t even know. But this description made me think that I really wanted to see this film. It isn’t playing anywhere, but I did manage to find its trailer:

Typically, viewers of the trailer have overwhelmingly panning it. There are 10 likes and 98 dislikes. This doesn’t speak to the quality of the film or the trailer. Instead, it speaks to the fact that people know that this film is supposed to be bad. It’s the same with Ed Wood films.[1]

I would still like to see the film. What I see in the trailer is a very creative effort. I suspect that those toddlers who have been able to see it have enjoyed it. And I wouldn’t be at all surprised if it eventually did very well in the DVD market.


[1] I wrote about this in comments on The 3 (or 7) Houses of Parliament:

I don’t mean to be ragging on Ed Wood above. I think rather highly of him. His films were always interesting. Wood was the first reason (I’ve since developed more) that I hate Michael Medved. Certainly anyone can see that Plan 9 is a far better film than Robot Monster, which for all of its silliness is very hard to watch. Or “Manos”: The Hands of Fate.

Of course, my opinion is that anyone who can complete any film on a shoestring deserves respect. I see $100 million films all the time that show no more imagination or insight. Think: almost any Marvel movie.

Paul Krugman Cracks a Joke

On his blog today, Paul Krugman discusses three current Republican misconceptions. The first is how Romney is a bad candidate. Krugman notes that this may be true, but he’s not as bad as everyone else who ran. It is much the same argument that Saturday Night Live presented last week:

Interestingly, it isn’t just YouTube that deletes videos. This used to be an NBC-hosted video from Saturday Night Live but it doesn’t work anymore. What’s more, it throws up an alert box rather than failing gracefully. What a joke!

Krugman added his own joke. It’s an oldie, but it still makes me laugh:

The fact was that all the non-Mitts were awesomely terrible, indeed ludicrous. The only contender who even looked on paper like a real alternative, Rick Perry, turned out to have three major liabilities: he was inarticulate, he was slow on his feet, and I can’t remember the third (sorry, couldn’t help myself).

The second misconception is that Paul Ryan is doing an inexplicably bad job selling his budget “ideas.” Krugman notes that these ideas only ever appealed to Serious Centrists: people like Thomas Friedman who think that Serious Ideas must require a great deal of pain for the little people (that is, not themselves or any of their friends). “There was never any good reason to believe that voucherizing Medicare would be anything but desperately unpopular,” he writes.

And then Krugman brings up how Republicans are pinning their hopes on a repeat of the first presidential debate in 2004. I remember this one well. In fact, I recently mentioned it. But he reminds us that the issue in that debate was not that Kerry won but that Bush lost. I remember this clearly. Bush’s claim that the six-way talks with North Korea were the right way to go really stood out, because it was the only policy that he seemed to have a handle on. Krugman’s argument is that Romney may do okay, but it is extremely unlikely that Obama is going to come off as an idiot.

I agree on this point. However, that doesn’t mean that Romney won’t get some traction from the debate. My thinking is that the chattering classes are looking for any reason to give Romney a boost. This isn’t because they want him to win; they just think the race is boring and will be more so if Romney doesn’t start doing better. So I’m expecting a lot of headlines saying things like, “Romney Nails It!” Of course, Romney could be a disaster, in which case that will be, “Romney Nails Own Coffin.”

But the main thing is that Paul Krugman made a funny.

Ayn Rand and Indians

Ayn RandThe first year I was in graduate school up in Oregon, I drove back and forth to the Bay Area a large number of times. One of the things I remember was hearing conservative talk radio. It was surprising to me just how often people would mention John Galt.

For those of you who have not read the novels of Ayn Rand (I don’t recommend it), John Galt is the hero of Atlas Shrugged. He’s an unapologetic capitalist who is rich because he is morally superior to the little (read: poor) people. And because the society is not licking his boots enough, he’s going to take his toys and go home. It really is that ridiculous, but if you want to see the hero rape the heroine, you’ll have to read Rand’s other opus, The Fountainhead (’cause chicks just love that).

I bring this up, because Ayn Rand’s presence in conservative politics has grown from the freaks on the fringe to the mainstream of the Republican Party. Who is John Galt? Mitt Romney is John Galt! (Paul Ryan just thinks he’s John Galt.)

Because I was once forced to marry a woman who was an Ayn Rand fan, I’ve read pretty much everything she’s ever written—at least in book form. And I think people miss the true horror show that is Ayn Rand when they focus just on her pseudo-free market beliefs. As bad as these are, there are even worse things

Let’s Play “Ayn Rand and Indians”!

In her Address to West Point in 1974, Ayn Rand had the following to say about the theft of Native American lands:

They didn’t have any rights to the land, and there was no reason for anyone to grant them rights which they had not conceived and were not using… What was it that they were fighting for, when they opposed white men on this continent? For their wish to continue a primitive existence, their “right” to keep part of the earth untouched, unused and not even as property, but just keep everybody out so that you will live practically like an animal, or a few caves above it. Any white person who brings the element of civilization has the right to take over this continent.

Okay, okay: this is vile. And it is racist. But that’s not even what I want to talk about here. This undercuts Rand’s basic philosophy in two ways.

First, this goes against Rand’s often stated claim that she was against violence. She often talked about the need for a “revolution of thought.” But here she is making a clear “might makes right” argument. “We don’t like what you’re doing with the land so we’re taking it.” Second, she is claiming that some outside authority knows better than a land owner what his land should be used for. Her thinking could as easily be used to justify the Nazi confiscation of Jewish property. You are either for the rule of law or you are not. Rand was not.

The End of History

What most strikes me in the quote above are the scare quotes around the word “right.” This is necessary for her to make her argument: our rights are real and their “rights” are illusory. But what kind of future does that provide for her philosophy? After all, aren’t other people going to come who don’t accept our “right” to exploit the land as we do?

The subtext of this is that we have reached the end of history. No better system of government could possibly be created than the one that Rand now sees. And this goes to something I often talk about: the libertarian (or conservative, more generally) belief that their preferred system is “natural.” The truth is that it is not. Humans naturally exhibit individualistic and communal tendencies and these are constantly jockeying for prominence. But even if the cut throat libertarian ideal were natural, is that good? Murder is natural. Rape is natural. But I wouldn’t want to base a society on them.

Rand, however, does want to base a society on them. She explicitly put rape as a positive act in one novel and one play. And murder by other means (e.g. starving the “moochers”) is found throughout her writing. But as we see in the case of the Native Americans, she was also for murder in a more explicit way.

And now some horrible combination of Ayn Rand and Old Time Religion are the core of the Republican Party.

My Name is Alberto Asenjo…

Alberto Casillas AsenjoEverybody loves a Spanish badass!

Alberto Casillas Asenjo is the owner of the Prado Cafe in Madrid. During the clash between protesters and police, he stood defiantly in his doorway. Click on over, the video is great. What most strikes me is that he is clearly afraid. And yet, he stays. That’s true bravery.

Of course, I had hoped to hear, “Hello. My name is Alberto Asenjo. You killed my father. Prepare to die.”

It’s the Great Pumpkin, Angela Merkel!

Spanish ProtestsThere continue to be major protests in Spain—one on Tuesday resulted in clashes with the police, ending in at least 22 arrests and 28 injuries. The people are rightly unhappy about the recent austerity deal. It’s very simple. The Spanish government—like most governments—has debt. Because they don’t have their own currency, potential lenders are concerned that Spain will default on this debt. Thus, interest rates on Spanish government bonds are ridiculously high (almost 7% a couple of months ago). This problem could easily be solved by the European Central Bank (ECB) guaranteeing the Spanish debt. But the ECB will only do this (more or less) in return for $50 billion in austerity—budget cuts and tax increases.

Here’s the reason that the people are angry: Spanish unemployment is almost 25%. These austerity measures will only make things worse. How do we know this? The last three years in Ireland, Italy, Greece, Portugal, United Kingdom, and Spain. Oh, and the United States. And John Maynard Keynes. And the Great Depression. You get the idea.

Austerity from Without!

The German government and the ECB have been pushing an idea that was really stupid 3 years ago but now is just loony: if these troubled economies slash the size of their governments, businesses will magically have “confidence” and start hiring. Paul Krugman has come up with the idea that these people believe in the “Confidence Fairy.” It’s kind of like the Tooth Fairy, but without the evidence to support it. Think: the Great Pumpkin. The Confidence Fairy will rise up out of the periphery giving a booming economy to all good countries.

As with most of economics, there are lots of feedbacks in these policies. Spain has to borrow money to support its debt, but because it doesn’t have its own currency, lender fears of default push up interest rates, and this in turn requires more borrowing. Cutting government spending causes the economy to shrink, the smaller economy provides fewer tax revenues, and this in turn makes more spending cuts necessary. The only way this works is if the Confidence Fairy makes an appearance. But just like in every year’s rerun of It’s the Great Pumpkin, Charlie Brown, she never does.

Moral Hand-Wringing

Here in the United States, most of the coverage on this issue is from the German perspective. It is highly moralistic. It goes like this: GIPSI (Greece, Ireland, Portugal, Spain, and Italy) borrowed too much money during the good times and so now they need to tighten their belts and tough out the recession. (25% unemployment!) The problem is that this is all wrong.

Economics is not a morality play. It doesn’t matter if GIPSI behaved badly before; their bad situation now is hurting everyone. But the fact of the matter is that of those 5 countries, only Greece’s government acted badly. Spain (and others) had a budget surplus going into this recession.

What happened was that banks in Germany (primarily) thought that the EU’s shared currency meant that loans to GIPSI were as safe as loans to Germany or France. When the recession hit and these countries had trouble paying their loans, the German bankers freaked out. Now, we’re supposed to wag a finger in the faces of GIPSI: “You shouldn’t have taken out those loans!” But somehow everyone seems to forget that it is the bankers and not the borrowers who are supposed to police the loans.

Rick Santelli and Moral Outrage

We’ve seen this same kind of thinking here in America. Rick Santelli famously started the Tea Party movement with his rant about how good people like him were being forced to pay for the bad loans other people took out. Even apart from all we know about predatory lending, this is a ridiculous contention. Parents know that if they allow it, their children will eat cookies to the point of illness. Similarly, bankers know that people want to borrow more than they can afford. Or at least they should know this.

Whether it is the Tea Party or the German government, there is no place for moralizing when cleaning up an economic mess. But of course, this idea worked half way. There was no moralizing about saving the banks. In fact, after saving them, nothing was done to stop them having to be saved in the future. But when it came to saving homes and jobs, well, those people got what they deserved.

The people in Spain are fighting back. I wish them well.

¡Viva España!

Afterword

Democracy Now! has a good story about what’s going on in Spain from the people’s perspective. It contains some interesting reporting like the fact that after foreclosure and eviction, people are still held responsible for their loans. Wow.

Update (26 September 2012 9:24 pm)

If you look on Google News, you will see that almost all of the coverage of this story is about how it is affecting the stock market. Pathetic. The AP has a good piece, Spain counts cost of anti-austerity protest, that gives an overview of what is happening. Note: its claim that 26 of the injured were police is almost certainly propaganda. Of the 28 initially listed in the CNN report, only two were police.

Update (27 September 2012 7:01 pm)

Paul Krugman wrote about all this in today’s New York Times. It is worth reading the whole article, but I was struck by this:

Much commentary suggests that the citizens of Spain and Greece are just delaying the inevitable, protesting against sacrifices that must, in fact, be made. But the truth is that the protesters are right. More austerity serves no useful purpose; the truly irrational players here are the allegedly serious politicians and officials demanding ever more pain.

He concludes:

Beyond that, a significant part of public opinion in Europe’s core—above all, in Germany—is deeply committed to a false view of the situation. Talk to German officials and they will portray the euro crisis as a morality play, a tale of countries that lived high and now face the inevitable reckoning. Never mind the fact that this isn’t at all what happened—and the equally inconvenient fact that German banks played a large role in inflating Spain’s housing bubble. Sin and its consequences is their story, and they’re sticking to it.

Worse yet, this is also what many German voters believe, largely because it’s what politicians have told them. And fear of a backlash from voters who believe, wrongly, that they’re being put on the hook for the consequences of southern European irresponsibility leaves German politicians unwilling to approve essential emergency lending to Spain and other troubled nations unless the borrowers are punished first.

Of course, that’s not the way these demands are portrayed. But that’s what it really comes down to. And it’s long past time to put an end to this cruel nonsense.

If Germany really wants to save the euro, it should let the European Central Bank do what’s necessary to rescue the debtor nations—and it should do so without demanding more pointless pain.

You can see in these comments the danger of past German government demagoguery: now that the government may want to fix the situation, it feels constrained by the Frankenstein’s Monster that it’s created in the people.

A Feather in Scott Brown’s Cap

Racist Image of Elizabeth WarrenAfter seeing some of the debate Thursday night between Massachusetts Senator Scott Brown and Elizabeth Warren, I was angry. Brown said something that was so racist, I was stunned. He wasn’t claiming to have special insight into Warren’s family history when he claimed, “She checked the box claiming she’s a Native American, and clearly she’s not.” Instead, he was saying, “Clearly she’s white!”

This gave me an idea for a poster: a picture Elizabeth Warren in a Cherokee headdress with a caption that read, “Satisfied Scott?” I thought that got to the heart of Brown’s thinking. He seems to be saying that he knows what a Native American looks like because he’s seen lots of westerns.[1] But brilliant as I thought my poster idea was, I was afraid that people might take it the other way. They might think that I was implying, like Brown, that it was ridiculous to claim that Warren was part Native American.

So I did a Google image search of “Elizabeth Warren Indian.” And I found tons of images like the one on the left. None that I have found are making the point that I was trying to make. Instead, they are examples of what I was trying to spoof.

Yesterday, a Scott Brown staff member and other supporters were caught on video doing “tomahawk chops and war whoops” outside a Brown campaign event. Brown said that he didn’t condone these actions, but he said he wouldn’t apologize because it is Warren who should apologize for claiming to be 1/32 Native American.

This isn’t about the substance of Brown’s claim that Warren got an unfair advantage in her academic career by using this heritage. I don’t think anyone can take this seriously. Warren is a brilliant attorney and that’s why she has reached her position in academia and politics. But Brown can try to make that case.

What comes across is that Brown and his supporters are at best insensitive to our national history of genocide and theft from native peoples. It is horrible and it reeks of desperation.


[1] Strangely, he’s never seen movies like A Man Called Horse where the definition of a tribe member is a little more complicated than that.