History is Happening Now

Do the folks who write editorials for the Wall Street Journal ever talk to the folks who write articles for the Wall Street Journal?

Consider recent reporting/opining about Barack Obama’s $800-billion-plus economic stimulus bill. Here’s how Greg Hitt and Elizabeth Williamson describe it in their article from January 28, 2009:

The economic stimulus package proposed by Democratic House leaders totals $825 billion and includes three broad pieces: a $365.6 billion spending measure for such brick-and-mortar projects as highways and bridges; a $180 billion measure to boost jobless benefits and Medicaid, among other things; and a $275 billion tax-relief package, which includes a plan to give a $500 payroll tax holiday to all workers, a proposal from Mr. Obama’s presidential campaign.

If you pay attention to the arguments that the super-pundits of the right are making in their efforts to defeat this bill, you’d think it was different. Here’s an excerpt from a recent editorial in the Wall Street Journal:

In selling the plan, President Obama has said this bill will make “dramatic investments to revive our flagging economy.” Well, you be the judge. Some $30 billion, or less than 5% of the spending in the bill, is for fixing bridges or other highway projects. There’s another $40 billion for broadband and electric grid development, airports and clean water projects that are arguably worthwhile priorities.

Add the roughly $20 billion for business tax cuts, and by our estimate only $90 billion out of $825 billion, or about 12 cents of every $1, is for something that can plausibly be considered a growth stimulus. And even many of these projects aren’t likely to help the economy immediately. As Peter Orszag, the President’s new budget director, told Congress a year ago, “even those [public works] that are ‘on the shelf’ generally cannot be undertaken quickly enough to provide timely stimulus to the economy.”

So let’s try to understand. According to the Wall Street Journal’s editorial page, the following things can “plausibly be considered a growth stimulus”: fixing bridges or other highway projects, broadband and electric grid development, airports and clean water projects. Presumably, all these projects fall under the category of “a $365.6 billion spending measure for such brick-and-mortar projects as highways and bridges,” as reported in the news article. So if you subtract the $70 billion in construction projects mentioned in the editorial from the $365.6 billion in the news article, you get … $295 billion in “such brick-and-mortar projects as highways and bridges.”

Why can the $70 billion mentioned “plausibly be considered a growth stimulus” but the other $295 billion can’t? The editorial doesn’t say.

Also, the editorial refers to the $20 billion in business tax cuts as spending that “can plausibly be considered stimulus,” leaving out at least 90% of “a $275 billion tax-relief package, which includes a plan to give a $500 payroll tax holiday to all workers,” as reported in the article.

Why can $20 billion in business tax cuts “plausibly be considered stimulus,” but more than $250 billion in additional tax cuts cannot? Once again, the editorial doesn’t say. It’s as though the rest of the tax cuts in the bill don’t exist.

The editorial has this to say later on:

Here’s another lu-lu: Congress wants to spend $600 million more for the federal government to buy new cars. Uncle Sam already spends $3 billion a year on its fleet of 600,000 vehicles. Congress also wants to spend $7 billion for modernizing federal buildings and facilities. The Smithsonian is targeted to receive $150 million; we love the Smithsonian, too, but this is a job creator?

It doesn’t take a rocket scientist to understand how it might help the economy if the United States government pumped $600 million into the market for new cars at a time when the American auto industry is on the verge of collapse. And as for the $7 billion for “modernizing federal buildings and facilities,” it’s impossible to fathom how the Wall Street Journal could miss that this project supports jobs: It provides money to employ the people who will be modernizing federal buildings and facilities.

It’s interesting how the editorial uses different terms at different times in order to avoid acknowledging the incoherence of its arguments. For example, the editorial refers to some projects as “arguably worthwhile priorities,” as if the most important criteria we should use to evaluate spending items is whether the spending is “worthwhile.” Then, in the next paragraph, it refers to projects that “can plausibly be considered a growth stimulus,” as if the most important issue is not whether a project is “worthwhile,” but whether a project stimulates growth. Then, later on, the editorial asks if a particular project is a “job creator,” as if this is the most important issue.

What if the editorial were forced to be consistent — forced, in other words, to evaluate whether the modernization of federal buildings and facilities is “worthwhile” or “can plausibly be considered a growth stimulus”? I think the answers to these questions would obviously be yes, and the same goes for the plan to spend a measley $600 million on cars.

Here’s another paragraph from the editorial:

We’ve looked it over, and even we can’t quite believe it. There’s $1 billion for Amtrak, the federal railroad that hasn’t turned a profit in 40 years; $2 billion for child-care subsidies; $50 million for that great engine of job creation, the National Endowment for the Arts; $400 million for global-warming research and another $2.4 billion for carbon-capture demonstration projects. There’s even $650 million on top of the billions already doled out to pay for digital TV conversion coupons.

In discussing the $1 billion for Amtrak, they abandon altogether the idea that the spending should be “worthwhile” or “stimulus” or a “job creator,” and assert instead that Amtrak shouldn’t get the money because it hasn’t turned a profit in 40 years. Why is it relevant that Amtrak doesn’t turn a profit? The editorial doesn’t say. Then, it mysteriously mentions child-care subsidies and then refuses to make any argument about why it’s notable — an understandable omission, since these subsidies are worthwhile, they do create jobs, they can be considered stimulus, and child care workers generally turn a small profit.

And there’s this bit in the editorial:

Oh, and don’t forget education, which would get $66 billion more. That’s more than the entire Education Department spent a mere 10 years ago and is on top of the doubling under President Bush. Some $6 billion of this will subsidize university building projects. If you think the intention here is to help kids learn, the House declares on page 257 that “No recipient . . . shall use such funds to provide financial assistance to students to attend private elementary or secondary schools.” Horrors: Some money might go to nonunion teachers.

First of all, it’s fascinating to consider the Wall Street Journal’s argument: If you think the intention behind spending $66 billion on education is to help children learn, you’re wrong — and the reason you’re wrong is that the money won’t give students tuition to private schools. Consider how stupid or blinded by ideology you’d have to be to accept this argument as logical. Furthermore, the Wall Street Journal is now suggesting that this $66 billion should be evaluated based on whether it helps kids learn. What about “stimulus?” What about “job creation?” What about “worthwhile priorities?” Why can it “plausibly be considered a growth stimulus” to repair a road or a bridge, but not a school building?

The editorial also includes this:

Another “stimulus” secret is that some $252 billion is for income-transfer payments — that is, not investments that arguably help everyone, but cash or benefits to individuals for doing nothing at all. There’s $81 billion for Medicaid, $36 billion for expanded unemployment benefits, $20 billion for food stamps, and $83 billion for the earned income credit for people who don’t pay income tax. While some of that may be justified to help poorer Americans ride out the recession, they aren’t job creators.

So now the issue at hand is whether these expenditures “help everyone,” and whether these expenditures are “job creators.” Obviously, by definiton, jobless benefits are not going to be job creators — but isn’t it obvious that expanding benefits to the poor and unemployed will help the economy, as the poor and unemployed are the most likely to spend the money given to them, rather than saving or investing it? Can’t these programs “plausibly be considered growth stimulus?”

As for the idea that the spending should “help everyone,” it’s hard to see how federal money spent repairing a bridge on the west coast will help folks on the east coast, but these projects are apparently acceptable to the Wall Street Journal.

The editorial is so transparently disingenuous and manipulative that it’s hard to understand why such as editorial isn’t embarressing to the newspaper — but then, the Journal’s owner, Rupert Murdoch, probably figures that right-wingers aren’t looking for clarity and logic.

I’m predicting the final vote on Obama’s $800 billion-plus fiscal stimulus bill will be split along party lines, with only a few rogue Republicans in the House and Senate voting to support the bill.

In spite of Obama’s extraordinary efforts to work with the G.O.P. on this legislation, Republicans won’t support the bill for a variety of reasons. As Politico notes:

With most moderates having retired or been defeated, especially among House Republicans, there is little political danger in opposing nearly another trillion dollars in spending at a time when many conservative-leaning voters are weary of government intervention after months of bailouts.

In other words, the moderates — those Republicans who would have been most tempted to support the bill — were replaced with Democrats in the last election.

Furthermore, Republicans understand that in order for their party to return to power anytime soon, Obama must not go down in history as a phenomenally successful president; and this means they cannot hand Obama a massive political victory in the first weeks of his presidency. In his final column for the New York Times, Conservative columnist William Kristol correctly identifies the significance of Obama’s fortunes. He begins by acknowledging (proclaiming?) that a conservative era in American politics that began with Ronald Reagan has ended. Then, he considers whether the new era will be a liberal one:

The answer lies in the hands of one man: the 44th president. If Reagan’s policies had failed, or if he hadn’t been politically successful, the conservative ascendancy would have been nipped in the bud. So with President Obama today. Liberalism’s fate rests to an astonishing degree on his shoulders. If he governs successfully, we’re in a new political era. If not, the country will be open to new conservative alternatives.

I believe Kristol is right: If Obama is seen as a successful president, it will not only empower him to make significant progress in implementing his agenda throughout his eight years in office — it will also set the stage for Democratic dominance of American politics for a generation. Which is not what the uber-conservative Republicans want at all. So they can’t acknowledge that Obama’s plan is good for the country.

Finally, it seems that many conservatives honestly don’t think the stimulus bill will work. Consider the following reporting from Politico:

Obama’s soothing tones Tuesday couldn’t mask his disagreement with Republicans on the need for more tax cuts in the package. That was the first question he took in his meeting on the House side — and Obama brushed it away with a polite, but firm, no thanks.

“Feel free to whack me over the head because I probably will not compromise on that part,” Obama said of Republican opposition to the Democrats’ refundable tax credits, according to two sources in the room.

Finger-pointing aside, that partisan reality gets at why the relationship is fraying: irreconcilable differences.

“It lasted about two days,” quipped Sen. Jim Inhofe (R-Okla.), when asked if the honeymoon was over.

Why so soon?

Because, he said, conservatives are just “not receptive” to Obama’s agenda.

Yet even Inhofe, a true-believing conservative who represents a state in which Obama lost every county, is unwilling to take after his former colleague.

“He is very likable, he presented himself very well, and he seemed to want to be inclusive,” Inhofe said in a brief interview following Obama’s meeting. “But if the product is anything like we think it’s going to be, it’s not one that is going to be sellable to conservatives.”

In other words, a lot of Republicans will oppose the bill because it’s just not what conservatives want to do. That’s American democracy.

For all of these reasons, Republicans won’t give Obama the “bipartisan” support he is looking for. Nevertheless, the bill will pass — and then Obama’s political fortunes will rise or fall based on how effectively the bill turns our country’s economic frown upside-down. Of course, not long after the bill passes — maybe a few months later, maybe six months later — Republicans will argue that the bill was a dismal failure, and Democrats will argue that the bill was a smashing success. I believe this is basically the debate that will determine whether Congressional Democrats keep their majorities in Congress in 2010.

So lets hope the bill is a success, for the sake of the millions of Americans who will benefit from a strong economy, and for the sake of the millions of Americans who will benefit from another two years of Democratic governance.

So if Obama is doomed to fail in his efforts to win lots of yes votes from both parties on his stimulus bill, what is the point of all his extraordinary ”reaching out” to Republicans? All right, all right, perhaps calling it “extraordinary” is over-the-top. The media uses the word “rare.” As in:

Obama’s trip to Capitol Hill was rare for a sitting president, especially given his decision to meet only with the opposition. He met with Democratic lawmakers earlier this month.

                                                               -  The Washington Post

A week after being sworn into office, Mr. Obama returned to the Capitol for the first of what his advisers said would be frequent visits with members of Congress. Yet it was still a rare event for a president, particularly a Democratic one, to sit down with the entire Republican conference. …

It was far too early to say whether Mr. Obama’s visit to Capitol Hill would attract any more Republican votes for the economic recovery plan that is scheduled to be considered on Wednesday in the House. But officials from both sides said it was the beginning of a dialogue between Congressional Republicans and the White House that did not exist even when George W. Bush was in the Oval Office.

                                                                -  The New York Times

The rare trip by a president to Capitol Hill revealed the urgency in Congress and the White House over a cure for the souring economy

                                                                          –  The Wall Street Journal

So the Washington press corps seems to agree that Obama’s visit with Congressional Republicans was “rare.” It is also worth noting that his visit effectively compelled a number of Republicans to say nice things about him. Consider this from the L.A. Times:

Despite their opposition to the stimulus plan, many House Republicans came away from their meeting with Obama saying the president had impressively laid the groundwork for future cooperation.

“I thought it was a great gesture on his part and it begins a dialogue,” (Rep. Paul D. Ryan, R-Wis) said. “He did a good job starting us off, at least, beginning to talk to one another. And that will help him in the future.”

And this from the New York Times:

Representative John A. Boehner of Ohio, the House Republican leader, said after the meeting that significant philosophical differences remained between the president and the Republicans, but they also agreed on several fronts. The mere fact of the meeting, he said, was an early sign of a willingness by the White House to solicit input from all sides.

“We both share a sincere belief that we have to have a plan that works, that will revive our economy, create jobs and help preserve jobs in our country,” Mr. Boehner said. “I think our members enjoyed the conversation. I think the president enjoyed the conversation. I look forward to continuing to work with him to improve this package.”         

And this from Politico:

Rep. Shelley Moore Capito (R-W.Va.), one of the House Republicans on Obama’s target list, lavished praise on the president for coming to visit in an interview after the lunch. But she indicated she was still uncertain if she could reward his effort.

“Do we need a stimulus? I believe we do. But do we need to spend the amount that were spending? I’m not convinced of that.”

Rep. Judy Biggert (R-Ill.), asked if any of her colleagues were more inclined to support the stimulus measure after their back and forth with Obama, was more blunt: “I don’t think so.”

Of course, she didn’t want to place the blame at the president’s feet.

“It’s unfortunate that their leadership didn’t negotiate with us,” Biggert said. “The problem is that the process now is too far down the road.”

But, with a twinkle, she said, “he really cares about what he’s doing.”

Obama is “sincere.” He is “laying the groundwork for future cooperation.” He “did a good job” getting them to “talk to one another.” He has a “willingness” to “solicit input from all sides.” He “presented himself very well, and seemed to want to be inclusive.” He “really cares about what he’s doing.”

I don’t know what all this praise means, but it will be interesting to see how many of these same Republicans are willing to support nasty campaign ads against Obama in four years. It may be that Obama is actually setting a new tone in Washington — and setting a new precedent against with all future presidents will be judged in their treatment of members of Congress.

UPDATE: It appears the bill may win at least one Republican Senator’s vote, according to this report from a Politico article released tonight:

Rising above the fray Tuesday — but almost omnipresent — was Obama himself, meeting with rank-and-file House and Senate Republicans and making his case that the floor votes ahead are just the first steps in a larger action plan to address financial regulations, home foreclosures and banks teetering near insolvency.

“His presentation was a tour de force,” New Hampshire Sen. Judd Gregg told Politico. The top Republican on the Senate Budget Committee, Gregg has been an outspoken critic of the level of new spending in the administration’s plan but said: “I felt much better. … He’s clearly moving forward aggressively on all the different fronts. I was very impressed. If he puts it in the context of an integrated effort, I’d consider it.”

Now why didn’t George W. Bush meet with rank-and-file Democrats and impress them with his “tour de force” presentations about his overall strategy in the War on Terror?

I guess we’ll never know.