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A More Productive Path than Self-Immolation

Wednesday, August 4th, 2010
Scott Winship


Scott Winship is research manager of the Pew Economic Mobility Project and a recent graduate of Harvard's doctoral program in social policy. The views he expresses do not represent those of Pew.

by Scott Winship

Everyone’s approvingly linking to this Edward Luce piece on “the crisis of middle-class America.” I want to set myself on fire.

Seriously, it’s discouraging to see so many people who should know better (because they’ve argued these points with me before) promoting this article.  I can’t think of another piece in the doomsday genre—and there are many—that gets it so consistently wrong. I’ll stipulate that none of the criticisms below are intended to minimize the struggles that many people are facing.  But it’s important to get this stuff right. Let me dive in, with Luce’s words in italics and my responses following:

Yet somehow things don’t feel so good any more. Last year the bank tried to repossess the Freemans’ home even though they were only three months in arrears.

The share of mortgages either in foreclosure or 3 or more months delinquent is 11.4 percent, which, because 30 percent of homeowners have paid off their mortgage, translates into 8 percent of homes. So the Freemans’ situation is typical of about one in twelve homeowners, or not quite 3 percent of households (since one-third rent).

Their son, Andy, was recently knocked off his mother’s health insurance and only painfully reinstated for a large fee.

Luce is arguing that there’s a new crisis facing the current generation. About 30 percent of those age 18 to 24 were uninsured in 2008 when the National Health Interview Survey contacted them.  I don’t have trends for that age group, but the share of Americans under age 65 without health insurance coverage was 14.7 percent in 2008, up from…14.5 percent in 1984.

And, much like the boarded-up houses that signal America’s epidemic of foreclosures, the drug dealings and shootings that were once remote from their neighbourhood are edging ever closer, a block at a time.

Well, the violent crime rate in 2008 was 19.3 per 1,000 people age 12 and up, down from 27.4 in 2000 and 45.2 in 1985.

Once upon a time this was called the American Dream. Nowadays it might be called America’s Fitful Reverie. Indeed, Mark spends large monthly sums renting a machine to treat his sleep apnea, which gives him insomnia. “If we lost our jobs, we would have about three weeks of savings to draw on before we hit the bone,” says Mark, who is sitting on his patio keeping an eye on the street and swigging from a bottle of Miller Lite. “We work day and night and try to save for our retirement. But we are never more than a pay check or two from the streets.”

The key question is, again, Is this worse than in the past? The risk of a large drop in household income has risen modestly, but people experiencing a drop end up much better off than in the past. For example, the risk of a 25 percent drop in income over 2 years has risen from 7 percent among married couples in the late 1960s to 14 percent in the mid-2000s (based on my computations from Panel Study of Income Dynamics data). But if you look at the average income of married-couple families after their 25 percent drop, it rose from $40,000 to $63,000 (in constant 2009 dollars).

Solid Democratic voters, the Freemans are evidently phlegmatic in their outlook. The visitor’s gaze is drawn to their fridge door, which is festooned with humorous magnets. One says: “I am sorry I missed Church, I was busy practicing witchcraft and becoming a lesbian.” Another says: “I would tell you to go to Hell but I work there and I don’t want to see you every day.” A third, “Jesus loves you but I think you’re an asshole.” Mark chuckles: “Laughter is the best medicine.”

Hmmm…just a typical American household…

The slow economic strangulation of the Freemans and millions of other middle-class Americans started long before the Great Recession, which merely exacerbated the “personal recession” that ordinary Americans had been suffering for years. Dubbed “median wage stagnation” by economists, the annual incomes of the bottom 90 per cent of US families have been essentially flat since 1973 – having risen by only 10 per cent in real terms over the past 37 years. That means most Americans have been treading water for more than a generation. Over the same period the incomes of the top 1 per cent have tripled. In 1973, chief executives were on average paid 26 times the median income. Now the multiple is above 300.

Adjusting for household size and using the PCE deflator to adjust for inflation, median household income in the Current Population Survey rose from $29,800 in 1973 to $40,500 in 2008 (in 2009 dollars, again based on my compuatations).  Factoring in employer and government noncash benefits would show even more impressive growth.

In the last expansion, which started in January 2002 and ended in December 2007, the median US household income dropped by $2,000 – the first ever instance where most Americans were worse off at the end of a cycle than at the start.

This is entirely a function of changes in the population composition (more Latinos) and in the share of employee compensation going to health insurance and retirement plans.

Worse is that the long era of stagnating incomes has been accompanied by something profoundly un-American: declining income mobility.

Nope. The evidence is ambiguous, but the best studies imply that intergenerational economic mobility hasn’t changed that much in the past few decades. Intra-generational earnings mobility has increased since the 1950s, though it has declined among men.

Alexis de Tocqueville, the great French chronicler of early America, was once misquoted as having said: “America is the best country in the world to be poor.” That is no longer the case. Nowadays in America, you have a smaller chance of swapping your lower income bracket for a higher one than in almost any other developed economy – even Britain on some measures. To invert the classic Horatio Alger stories, in today’s America if you are born in rags, you are likelier to stay in rags than in almost any corner of old Europe.

Tim Smeeding’s research based on the Luxembourg Income Study shows that in general Americans have higher incomes than their European counterparts as long as they are in the top 80 to 90 percent of the income distribution.  Below that, incomes are more comparable across countries, and the living standards of Americans look less impressive.  The US has comparable intergenerational earnings mobility to Europe, according to Markus Jantti’s research, except among men (but not women) who start out at the bottom.  In terms of occupational mobility, David Grusky’s research shows we’re as good or better as anywhere else, but this doesn’t translate into earnings mobility because we let people get rich or poor to a greater extent than other countries do. Jantti and Anders Bjorklund have estimated that Sweden would have the same mobility as the U.S. if the return to skill was as high there as it is here.  Finally, employer benefits further complicate how “bad” we look.

Combine those two deep-seated trends with a third – steeply rising inequality – and you get the slow-burning crisis of American capitalism. It is one thing to suffer grinding income stagnation. It is another to realise that you have a diminishing likelihood of escaping it – particularly when the fortunate few living across the proverbial tracks seem more pampered each time you catch a glimpse. “Who killed the ­American Dream?” say the banners at leftwing protest marches. “Take America back,” shout the rightwing Tea Party demonstrators.

The rise in income inequality is mostly about the top 5 percent of the top 1 percent pulling away from everyone else, and existing estimates overstate inequality and its growth by ignoring employer and government noncash benefits and possibly by ignoring different rates of inflation in different parts of the income distribution.

Unsurprisingly, a growing majority of Americans have been telling pollsters that they expect their children to be worse off than they are.

Totally wrong.  The key here is to only look at polling questions that ask people about their own kids, not kids in general.  Here are the relevant survey results I could find:

General Social Survey (1994)—45 percent said their children’s standard of living will be better (vs. 20 percent worse)
General Social Survey (1996)—47 percent
General Social Survey (1998)—55 percent
General Social Survey (2000)—59 percent
General Social Survey (2002)—61 percent said their children’s standard of living will be better (vs. 10% worse)
General Social Survey (2004)—53 percent
General Social Survey (2006)—57 percent
General Social Survey (2008)—53 percent
Economic Mobility Project (2009)—62 percent said their children’s standard of living will be better (vs. 10 percent worse)    (unlike GSS and PRC, asked only of those with kids under 18)
Pew Research Center (2010)—45 percent said their children’s standard of living will be better (vs. 26 percent worse)

BusinessWeek (1989)—59 percent said their children will have a better life than they had (and 25 percent said about as good)
BusinessWeek (1992)—34 percent said their children will have a better life than they had (and 33 percent said about as good)
BusinessWeek (1995)—46 percent said their children will have a better life than they have had (and 27 percent said about as good)
BusinessWeek (1996)—50 percent expected their children would have a better life than they have had (and 26 percent said about as good)
Harris Poll (2002)—41 percent expected children will have a better life than they have had (and 29 percent said about as good)

Harris Poll (1997)—48 percent felt good about their children’s future
Harris Poll (1998)—65 percent felt good about their children’s future (17 percent N.A.)
Harris Poll (1999)—60 percent felt good about their children’s future (15 percent N.A.)
Harris Poll (2000)—63 percent felt good about their children’s future (17 percent N.A.)
Harris Poll (2001)—56 percent felt good about their children’s future
Harris Poll (2002)—59 percent felt good about their children’s future
Harris Poll (2003)—59 percent felt good about their children’s future
Harris Poll (2004)—63 percent felt good about their children’s future

Pew Research Center (1997)—51 percent said their children will be better off than them when they grow up
Pew Research Center (1999)—67 percent said their children will be better off than them when they grow up

Bendixen & Schroth (1989)—68 percent said their children will be better off than they are
Princeton Religion Research Center (1997)—62 percent of men said their sons will have a better chance of succeeding than they did; 85 percent of women said their daughters will have a better chance
Angus Reid Group (1998)—78 percent said children will be better off than them
Washington Post/Kaiser Family Foundation/Harvard (2000)—46 percent said they were confident that life for their children will be better than it has been for them
Economic Mobility Project (2009)—43 percent said it would be easier for their children to move up the income ladder
Economic Mobility Project (2009)—45 percent said it would be easier for their children to attain the American Dream

Also, polls consistently show that Americans say they have higher living standards than their parents.

And although the golden years were driven by the rise of mass higher education, you did not need to have graduated from high school to make ends meet. Like her husband, Connie Freeman was raised in a “working-class” home in the Iron Range of northern Minnesota near the Canadian border. Her father, who left school aged 14 following the Great Depression of the 1930s, worked in the iron mines all his life. Towards the end of his working life he was earning $15 an hour – more than $40 in today’s prices.

Thirty years later, Connie, who is far better qualified than her father, having graduated from high school and done one year of further education, makes $17 an hour.

It’s not valid to compare her pay mid-career to her father’s at the end of his career—and also, how much work experience does she have relative to him?  Did she take time off to raise kids?

The pace of life has also changed: “We used to sit around the dinner table every evening when I was growing up,” says Connie, who speaks with prolonged vowels of the Midwest. “Nowadays that’s sooooo rare.”

Time-use surveys show that while parents spend more time working (because of mothers) than in the past, they do not spend less time with children.  They spend less time doing things by themselves.

Then there are those, such as Paul Krugman, The New York Times columnist and Nobel prize winner, who blame it on politics, notably the conservative backlash which began when Ronald Reagan came to power in 1980, and which sped up the decline of unions and reversed the most progressive features of the US tax system.

Fewer than a tenth of American private sector workers now belong to a union. People in Europe and Canada are subjected to the same forces of globalization and technology. But they belong to unions in larger numbers and their health care is publicly funded.

Though unionization has declined markedly in most of these countries, and their health care policies are increasingly becoming too costly.  Also, most of the decline in unionization in the U.S. occurred before Reagan took office.

More than half of household bankruptcies in the US are caused by a serious illness or accident.

This is bad Elizabeth Warren research—she counts a bankruptcy as being “caused” by illness or accident if one was reported, but the household could have been in serious debt before these occurred.  At any rate, bankruptcies are exceedingly rare (under 1 percent of households—see Figure 13).

Pride of place in Shareen Miller’s home goes to a grainy photograph of her chatting with Barack Obama at a White House ceremony last year to inaugurate a new law that mandates equal pay for women.

As an organizer for Virginia’s 8,000 personal care assistants – people who look after the old and disabled in their own homes – Shareen, 42, was invited along with several dozen others to witness the signing.

Ah…another representative household…

More and more young Americans are put off by the thought of long-term debt.

Evidence?

Had enough?  I have speculated that to the extent economic insecurity has increased, it reflects the impact of a negativistic media (amplified by gloom-and-doom liberalism).

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Pieces like Luce’s—and the blog posts it generates—affect consumer sentiment. Ben Bernanke and Tim Geithner aren’t the only people who can inadvertently talk down the economy.

This item is cross-posted at ScottWinshipWeb.

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Posted in A New Framework for Growth and Equity, Daily Fix | 1 Comment »

Wikileaks: Lack of Editorial Discretion

Tuesday, July 27th, 2010
Jim Arkedis


Jim Arkedis is the director of PPI's National Security Project.

by Jim Arkedis

Does the existence of a whistle-blower website like Wikileaks do more harm or good? Decisions about exposing information to the public depends on nuance and context, and it’s clear that in the wake of this case, Julian Assange, the site’s editor-in-chief and public face, has little appreciation for either.

Wikileaks is, in effect, a conduit for purported whistle-blowers, and describes itself as a “buttress against unaccountable and abusive power” and prides itself on “principled leaking.”

As a vehicle for whistle-blowing, the site has a responsibility to assert editorial discretion about the content it supplies, carefully weighing costs and benefits to the whistle-blowing party, those the information directly impacts and third parties. If Wikileaks is an open-repository for secret information without discretion and vetting, that’s a problem.

Prior to releasing the current military documents, the site should have exercised discretion with the following criteria in mind:

– Does the totality of the information indicate unequivocal, fact-based wrongdoing?
– Is this information new? Does it add to the public debate?
– Does its release endanger or save lives?
– Does its release cost or save public money?

By its own standard, Wikileaks, at best, punted. More likely, it outright failed and discredited itself.

Assange could not make a reliable judgment about the totality of the information he released because he could not have possibly known what exactly he was releasing. With Wikileaks staff reportedly of about five full-timers and a budget of $300,000, it’s difficult to imagine how the site could have shifted through so many documents and assembled a reasonable cost-benefit analysis, even with an “army” of hundreds of part-time volunteers. Rather, he essentially outsourced vetting to The New York Times, Guardian, Der Spiegel, and other websites that have cattle-called hungry readers to sift through the material. Ergo, Wikileaks likely had no idea if it was releasing ironclad evidence of wrongdoing.

Second, as I detailed yesterday, the information was clearly not “new.” It only served to amplify public debate. Further, the information’s release likely endangered American lives, and certainly jeopardized American sources in methods and consequently, its safety.

Finally, it’s unclear about saving public money, unless you argue that ending the war would do so. But that argument, much like the answers to all of the above, suggest that Assange and Wikileaks are motivated much more by activism than journalism. And that discredits any strain of legitimate public service the site hopes to render in the future.

From now on, Wikileaks would do well to know exactly what it’s releasing, know that it’s a new fact, and weigh the balance of lives, security and money.

Photo Credit: Joe-manna’s Photostream

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Georgia On the Mind

Friday, July 16th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

As alert readers know by now, Robert Bentley won the Republican gubernatorial runoff in Alabama, with Terri Sewell winning the 7th district Democratic congressional nomination (tantamount to election), and Martha Roby turning back viral ad icon Rick Barber for the Republican nomination in the 2nd congressional district. My write-up of the results can be found here.

The next big primary state is Georgia, where voters go to the polls next Tuesday, July 20. There are competitive primaries for governor in both parties; and competitive Republican primaries for Congress in no fewer than six districts, with two Democratic congressional primaries that have drawn some attention. Georgia has a 50 percent nomination requirement, which means many contests will go to a runoff on August 10. This is also a state with a history of substantial early voting, though as of last week, mail-in and in-person ballots were down from prior elections, perhaps indicating a low turnout.

The Republican gubernatorial race (incumbent Republican Gov. Sonny Perdue is term-limited) has heated up in the last week, with a bunch of polls, sharp exchanges between candidates, and interventions by national figures. For most of the cycle, the front-runner has been State Insurance Commissioner John Oxendine, though he’s been considered vulnerable because of long-pending ethics investigations of alleged illegal contributions to his campaign by insurance companies. Three other candidates—former Secretary of State Karen Handel, former congressman Nathan Deal (who has some ethics issues of his own, which appeared to speed his departure from Congress), and state senator Eric Johnson—have been jockeying for a runoff position opposite Oxendine, though at least two polls now show the front-runner slipping into third place. Handel, whose campaign message closely resembles that of South Carolina gubernatorial nominee Nikki Haley (a “conservative reformer” fighting the “corrupt good old boys”), has been the candidate on the move of late, and got priceless attention this week from a Facebook endorsement by Sarah Palin. Deal countered with an endorsement from Georgian Newt Gingrich. Both Oxendine and Deal have been pounding Handel for alleged heresy on abortion and gay rights. And meanwhile, Johnson has been heavily running television ads, and has moved up into the teens in at least one poll. In other words, just about anything could happen on Tuesday, though Handel looks almost sure to have a runoff spot.

In terms of issues, all the GOP candidates have been competing to show avid support for an Arizona-style illegal immigration crackdown (Deal’s made this a signature issue, while Handel has sported an endorsement from Arizona Gov. Jan Brewer), and two candidates, Oxendine and Handel, have proposed abolition of the state’s income tax, reflecting the wild popularity of national “Fair Tax” proposals among Georgia Republicans. And all the candidates are hard-core conservatives on cultural issues, though Handel got into a fight with Georgia Right-to-Life by opposing its proposal to restrict IV fertilization procedures.

On the Democratic side, the big question all along has been whether former Gov. Roy Barnes, who lost to Perdue in a big upset eight years ago, can win the primary without a runoff, as most recent polls have suggested he will. Barnes’ most prominent challenger, Attorney General Thurbert Baker, got off to a very late start in television advertising, and is now trying to attract enough support from his fellow African-Americans to deny Barnes the win (African-Americans typically cast close to half the votes in Democratic primaries in Georgia). Baker got a significant boost earlier this week with an endorsement from President Bill Clinton (Baker was a big Human Rights Campaign supporter in 2008), and has been promoting legalization of electronic bingo as a way to raise money for K-12 education. But Barnes has strong African-American support of his own; just today he was endorsed by Atlanta Mayor Kasim Reed. Other significant candidates who could soak up some votes include former Secretary of State David Poythress, who’s been running an under-the-radar web-focused campaign, and former state House Democratic leader Dubose Porter, whose wife, Carol, is the odds-on favorite to win the Democratic nomination for Lt. Governor.

On the congressional front, the state’s two white (and Blue Doggy) Democratic House members, Jim Marshall and John Barrow, are as usual considered vulnerable in November. Marshall, whose district went solidly for John McCain, has drawn a strong opponent in state representative Scott Austin, who should win the GOP nomination easily on Tuesday. Barrow, whose district is marginally Democratic even in presidential years, has for the second time drawn a primary challenge from former state representative Regina Thomas, whom he beat 3-1 in 2008. Thomas got some help from in-district anger at Barrow’s vote against health care reform, but his massive financial advantage should get him over the line. Meanwhile, Tea Party-backed candidate Ray McKinney is favored over former fire chief Carl Smith for the right to oppose Barrow, though that race could easily go to a runoff.

There are big and active Republican primaries in the districts of African-American congressmen David Scott and Hank Johnson (who also faces former Dekalb County executive Vernon Jones, something of a party renegade, in the primary but isn’t expected to lose), who has had recent health problems, but Republicans would have to get very lucky to become competitive in either place.

An open seat in the north metro Atlanta 7th district has spawned a mammoth eight-candidate Republican primary to succeed John Linder, with every single candidate endorsing Linder’s “Fair Tax” proposal. Former state representative Clay Cox and former Linder chief of staff Rob Woodall are the favorite to make a runoff, though Christian Right figure Jody Hice also has some support.

And up in the North Georgia 9th district, until recently represented by gubernatorial candidate Nathan Deal, the winner of last month’s special election, Tea Party favorite and former state representative Tom Graves, must face pretty much the same field of opponents in the primary, but is expected to win.

In non-Georgia political news, the big development was probably the implosion of the Colorado gubernatorial campaign of former congressman (and GOP front-runner) Scott McInnis, accused of plagiarizing portions of a think-tank paper for which he was grossly overpaid a few years ago. Colorado Republicans are in a quandary; the only other candidate on the primary ballot, Don Maes, has struggled to raise money, and has, ironically, also been cited for campaign finance violations. To hand-pick another viable candidate, party leaders would have to wait for the primary to occur and then beg the winner to step aside.

Ed Kilgore’s PPI Political Memo runs every Tuesday and Friday

Photo credit: Airno’s Photostream

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A Look at the Senate Races

Friday, July 2nd, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

It’s now just four months until Election Day, and for those who really like to think ahead, not much more than a year-and-a-half away from the next Iowa caucuses. (Speaking of the 2012 presidential nominating process, I’ve got an item posted at FiveThirtyEight about the maneuvering over the rules and calendar for that contest.)

My political memo on Tuesday focused mainly on an overview of House races, so today let’s take a closer look at the U.S. Senate. As noted on Tuesday, Nate Silver has slightly upgraded Democratic Senate prospects after the recent batch of primaries, and now thinks the probabilities come in at about 55 for what Democrats might have in the way of a Senate majority after November. Over at the (subscription-only) “Cook Political Report,” Jennifer Duffy, relying somewhat less than Silver on polling data, reaches similar conclusions about the overall landscape but with different takes on specific races. Duffy, for example, still has Arkansas in the toss-up category, while Silver says: “Our model now shows Blanche Lincoln’s chances to be close to zero (technically, about 0.3 percent, which rounds down to zero).” Conversely, the Cook Report shows the Connecticut race as “lean Dem” (having briefly rated it as a toss-up after the military record controversy hit Democrat Richard Blumenthal), while FiveThirtyEight rates it as “safe Dem.” It will be interesting to see if these and other forecasts begin to converge as we get closer to November.

It’s also worth remembering that the nominees haven’t been sorted out yet in several competitive or potentially competitive Senate races, notably Colorado, Arizona, Florida and Wisconsin.  And most interesting of all will be to see if some sort of intensified national wave begins to help Republican Senate candidates towards the home stretch, which could solidify the GOP’s shaky hold on seats in Ohio and Missouri (and perhaps Florida, where Marco Rubio consistently trails now-indie Charlie Crist), while making Democratic incumbents in Washington, California and Wisconsin a lot more vulnerable. To use historical analogies, we’ll find out if this Senate cycle is more like 1980 and 2008, when one party (Rs in 1980, Ds in 2008) got every break and won every close race, or like 1982, a recession-ridden year when the incumbent Republicans dodged a lot of bullets.

The polling world this week was roiled by a conflict between Daily Kos and the Research 2000 public opinion research firm, which has done regular polling for DKos for the last two years.  DKos proprietor Markos Moulitsas dismissed the firm recently, apparently unhappy with its accuracy as rated by FiveThirtyEight. But then an investigation of anomalies in R2K numbers convinced Markos that there might be fraud or at least book-cooking involved, and now the charges and counter-charges are flying and lawsuits are being filed. As the facts get sorted out, all sorts of political observers (including yours truly) are looking back at what they might have said or concluded based on R2K data. It is clear that if R2K gets out or is forced out of the state polling biz, the dominance of Rasmussen data, with its apparent pro-GOP “house effect,” could grow, though PPP seems to be expanding its state polling significantly.

Poll Watch

In polls this week that aren’t part of any overriding dispute, PPP takes a look at GOP statewide primaries in Wisconsin, and finds self-funder Ron Johnson with a big lead over hard-core ideologue David Westlake in the Senate race, and Milwaukee County Executive Scott Walker with an equally comfortable lead over former Rep. Mark Neumann in the gubernatorial race.  Meanwhile the increasingly visible Republican polling firm Magellan has Democratic former Gov. John Kitzhaber and Republican candidate Chris Dudley even in the Oregon gubernatorial race, and shows Republican former Gov. Bobby Ehrlich inching ahead of incumbent Democrat Martin O’Malley in Maryland.

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Posted in Daily Fix, Fixing Our Broken Politics, Political Memo | 2 Comments »

Recommendations on Curbing the National Deficit

Friday, July 2nd, 2010
Will Marshall


Will Marshall is the president of the Progressive Policy Institute.

by Will Marshall

The following is the is an excerpt from Will Marshall’s June 30 testimony before the National Commission on Fiscal Responsibility and Reform during the commission’s first public listening session:

Chairman Bowles, Chairman Simpson, and Members of the Commission, I appreciate the opportunity to appear before you to discuss ways to put America on a fiscally sustainable course.

Once unemployment rates start to fall, U.S. policy makers must be prepared to pivot sharply from fiscal stimulus to fiscal restraint. Otherwise, a large and growing federal debt will deplete our capital stock and thereby limit future economic growth. It will divert resources from productive investment to interest payments on the debt, half of which is already held by foreign lenders. And it will shake investor confidence, here and abroad, in the fundamental soundness of the U.S. economy, eventually driving interest rates up and the dollar down.

Despite these dire and entirely foreseeable consequences, too many federal policy makers remain in denial about the need for fiscal discipline. You have taken on what many consider a Mission Impossible: forging a bipartisan consensus on how to defuse the nation’s debt crisis. That’s put you in the crosshairs of extreme partisans of the left and right, who imagine this problem can be solved strictly at the other side’s expense. By refusing either to cut spending or raise taxes, the two have joined in a tacit conspiracy to bankrupt the country.

Common to both is the assumption that you can have fiscal responsibility, or you can have progressive government, but you can’t have both. We at the Progressive Policy Institute have always rejected this false choice. We believe that a progressive government can and must live within its means, and that if it instead chases the illusion of borrowed prosperity, it’s not really progressive.

To paraphrase Franklin Roosevelt, Americans know instinctively that borrowing routinely to consume more than you produce is both bad economics and bad morals. I don’t think it’s an accident that, as public worries about deficits have been mounting, public trust in government has been plummeting.

So there’s a lot riding on your ability to forge consensus behind a bold and balanced plan to restore fiscal responsibility. Let me offer some thoughts on what that plan should include from the perspective of a “progressive fiscal hawk.”

Read the entire testimony.

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Posted in Daily Fix, Fiscal Responsibility | No Comments »

A Lull in Primary Action

Friday, June 25th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

We’re entering a slow period in state primaries, with the only contests on tap for the next four weeks being a runoff in Alabama on July 13 and Georgia’s primary on July 20. The former event features a Republican gubernatorial runoff between long-time front-runner Bradley Byrne and surprise second-place finisher Robert Bentley, who had to get past an unsuccessful recount petition by Tim James. In Georgia, there are competitive gubernatorial primaries in both parties, though former Gov. Roy Barnes seems to have the Democratic race well in hand at this point; Republicans have a fractious multi-candidate field led for many months by state insurance commissioner John Oxendine (whose ethics record is so controversial that RedState blogger Erick Erickson’s said he’d vote for Barnes if Oxendine wins the nomination), with a runoff almost certain.  I’ll have more about both states when we get closer to the balloting.

As expected, the landslide victories on Tuesday of Asian-American Nikki Haley and African-American Tim Scott in South Carolina has spurred a lot of commentary about the GOP’s new diversity. (It hasn’t got much attention, BTW, but Haley’s Democratic opponent, Vincent Sheheen, is of Arab descent, reflecting the long-time presence of Lebanese in the Deep South). But outside South Carolina, an equally remarkable aspect of those victories has gone largely unremarked: both candidates were protégés of disgraced Republican governor Mark Sanford, who has now achieved the political equivalent of eternal life in the success of his young associates. It will also be interesting to see how well Scott (assuming he wins his heavily Republican district in November), a hard-core conservative ideologue, fits in with the Congressional Black Caucus.

Utah Republicans are recovering from a nomination cycle that involved the rejection of a long-time incumbent Senator, Bob Bennett, and then a savage primary between two very conservative candidates, with the winner, Mike Lee, being very much the vehicle for national groups determined to move the GOP to the right. To understand that these Men of Principle haven’t gotten rid of the hypocrisy of traditional politics, check out the web site of the losing candidate, Tim Bridgewater. At the top is a pre-primary jeremiad that includes this line: “My opponent, D.C.-based attorney Mike Lee, is spending $200,000 on TV and radio, spreading lies and distortions about my business background.” A bit later he accuses Lee of “a desperate lie.” But over to the left on the page is a new bulletin that, predictably, endorses that desperate liar for the general election.

Moving along, you can expect some serious political fallout around the country from the U.S. Senate’s apparent defeat of what some have called a second stimulus bill. Most of the attention in national media has been paid to the impact on people whose unemployment insurance eligibility is running out. But the bill also included $16 billion in assistance to state and local government to help forestall layoffs of teachers and other public employees. Whatever you think of that as economic policy, it’s clear the withdrawn funds will wreak havoc in those states where governors and legislators had counted on the help, including those where Republicans are nervous about the public reaction to teacher layoffs and higher public university tuition. It’s another example of how tough-sounding rhetoric on fiscal austerity and small government is more popular than the practical steps needed to reduce spending, particularly in a recession, since there’s no state budget category called “waste, fraud and abuse” that can painlessly absorb cuts.

Poll Watch

In polling news, Rasmussen has a bunch of new take-it-with-a-grain-of-salt polls.  In the Nevada Senate race, a post-primary survey has Republican Sharron Angle up over Harry Reid 48-41, though her favorable/unfavorable ratio is no better than the incumbent’s. In the first general-election poll of the Vermont governor’s race in a long while, Rasmussen shows Republican Lt. Gov. Brian Dubie leading all the Democratic candidates, though Secretary of State Deb Markowitz holds him to a 47-40 lead. And in Washington, the new poll shows Sen. Patti Murray (D) and Republican Dino Rossi in a 47-47 dead heat.

A new Magellan poll in Arizona has John McCain with a comfortable 52-29 lead over conservative challenger, J.D. Hayworth, who’s having a tough week.

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SC, Utah Runoffs Highlight Tuesday Primaries

Tuesday, June 22nd, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

It’s primary day in Utah, with statewide primary runoffs on tap in North and South Carolina.

Taking these states in reverse order: South Carolina is almost certain to produce the bulk of national political headlines tonight, with the made-for-TV saga of Republican gubernatorial candidate (and certain boffo winner tonight) Nikki Haley front-and-center. In case you have somehow missed it, Haley is the very, very conservative state legislator who began the campaign as the underfunded protégé of disgraced “conservative reformer” Mark Sanford, and then vaulted into contention just as one and then two South Carolina Republican political operatives went public with allegations that they’d had illicit sex with the candidate.

It’s sometimes difficult to separate cause and effect in political developments, but it’s reasonably clear that the poorly documented sexual allegations against Haley, compounded more recently by crude attacks on her ethnicity (she’s second-generation Indian-American) and religion (she’s an adult convert to evangelical Protestantism from her family’s Sikh tradition), have immeasurably helped her campaign while reducing her once-powerful gubernatorial rivals to bystanders if not presumed accomplices in smears against her. Haley nearly won the nomination without a runoff, and was also endorsed by third-place finisher Attorney General Henry McMaster. Her opponent, Rep. Gresham Barrett, won the dubious prize of an endorsement from last-place primary finisher Lt. Gov. Andre Bauer, and also managed to outspend Haley in the brief runoff campaign. But that matters little in a race driven by scandal-fed free media, and the only question is how high her margin will rise, and how well she wears on voters in a long general election campaign against Democrat Vincent Sheheen.

Those who want to boost the GOP as a party that presents diverse candidates proclaiming a single rigid conservative message will be hoping against hope that another South Carolina runoff, in the Low Country 1st congressional district, produces a win for state representative Tim Scott. Scott, who like Haley claims the “true conservative” mantle (and has both a Sarah Palin endorsement and Club for Growth backing), is African-American, and in a coincidence that could have been made in Hollywood, his runoff opponent is none other than Strom Thurmond’s son, Paul (a Charleston County council member).

Meanwhile, in upstate South Carolina, Republican Rep. Bob Inglis is expected to lose his House seat to Tea Party favorite Trey Gowdy; Inglis only won 28 percent of the vote in the primary to Gowdy’s 39 percent. Inglis got into trouble for voting for TARP and daring to criticize Glenn Beck.

In North Carolina, it’s anybody’s guess as to whether Elaine Marshall or Cal Cunningham will win the Democratic nomination to face Sen. Richard Burr. Marshall led the primary 37-26, narrowly missing the 40 percent threshold for winning the nomination outright. She also got an endorsement from third-place primary finisher Ken Lewis, which added to her strength among African-American leaders. But Cunningham, who was recruited into the race by the DCCC, has been the aggressor in the runoff, touting his electability.  The only public poll of the runoff, taken by PPP last month, showed the two dead even with a large undecided vote. I’d guess Marshall is still the favorite to win a very low-turnout runoff.

Aficionados of wild campaigns and wilder candidates may be disappointed tonight by the expected defeat of North Carolina Republican congressional candidate Tim D’Annunzio, who according to PPP is trailing Harold Johnson for the right to take on Democratic incumbent Larry Kissell.

With so much national attention on the Carolinas, the ideological drama going on in both parties in Utah may not receive due notice. As you may recall, Utah Republicans dumped Sen. Bob Bennett at a state convention last month as he trailed two challengers for the right to go to today’s primary. The survivors, entrepreneur Tim Bridgewater and former SCOTUS clerk Mike Lee, are both hard-core conservatives by most national standards. But Lee’s national supporters (including Jim DeMint and RedState’s Erick Erickson) are going after Bridgewater hammer-and-tong as little other than the ideological heir to Bennett (who, along with another defeated candidate, Eagle Forum activist Cherilyn Eagar, has endorsed Bridgewater). The one independent poll shows Bridgewater up by nine points, but Lee has released his own poll showing him up nine points.

Meanwhile, Utah’s sole Democratic congressman, Tim Matheson, is facing a serious primary challenge from the left, from retired teacher Claudia Wright. Wright has made Matheson’s opposition to health reform a major theme, and there’s also been talk of Republicans crossing over into the open Democratic primary to “take out” the incumbent (though as always, tactical voting is actually a pretty rare phenomenon). In a late poll, Matheson led Wright 52-33, but whatever vote Wright receives will be closely watched for national implications, given progressive grumbling about Blue Dogs like Matheson.

Photo credit: maryaustinphoto

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Haley Accuser Endorses…Haley; Tuesday Primaries in NC, Utah

Saturday, June 19th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

If you want a pretty good indication of the power of ideology in today’s Republican Party, check out the latest endorsement of front-runner Nikki Haley for the Republican gubernatorial nomination just before next Tuesday’s runoff:

So let’s get this straight … we know for a fact that S.C. Rep. Nikki Haley is lying through her teeth every time she denies our founding editor’s claim that she had an “inappropriate physical relationship” with him in the Spring of 2007. On top of that, we also know for a fact that her political career could very well go down in flames if (and more likely “when”) this ticking time bomb goes off …

And yet we’re endorsing her for the 2010 S.C. Republican gubernatorial nomination anyway?

Correct….

[T]he bottom line for S.C. taxpayers is that Haley would vote the right way on the S.C. Budget and Control Board, use her veto pen to reduce the size and scope of government and sign a universal parental choice bill which would (at long last) provide parents with real options and our flawed system with real, market-based accountability.

Yes, Haley has been endorsed by the web page of South Carolina blogger Will Folks, whose allegation of an affair with Haley turned the gubernatorial race upside down. Unless you buy the theory that Folks and Haley actually cooked up the whole J’accuse to preempt rumors about her sex life and make her a martyr, Folks’ endorsement looks like a powerful validator of the notion that being Right is more important than being right to today’s conservative activists.

There haven’t been any public polls on this race released since the June 8 primary, but a pre-primary poll by PPP that asked about a hypothetical Haley-Gresham Barrett runoff showed her up 51-35. This was before third-place finisher Henry McMaster endorsed Haley.

In North Carolina, where Democrats are having a Senate runoff on Tuesday, the only post-primary poll (again, by PPP) showed first-place primary finisher Elaine Marshall and DSCC favorite Cal Cunningham even at 36 percent with a large undecided vote. But that was more than a month ago, and given the likelihood of very low turnout, anything could happen. Marshall was endorsed by third-place finisher Ken Lewis, buttressing her advantage among African-Americans, and also by MoveOn.

And in Utah, whose primary is also on Tuesday, a poll taken for Mike Lee’s campaign showed him leading Tim Bridgewater in the Republican Senate race 39-30.  Bridgewater, a hard-core conservative but in better standing than Lee with the GOP establishment, has been endorsed by defeated incumbent Sen. Bob Bennett and also by fourth-place finisher Cherilyn Eager.

Poll Watch

In polling news, it’s a sign of the trouble that the long-time front-runner in the Florida Republican gubernatorial race, Bill McCollum, is experiencing with free-spending late-entering candidate Rick Scott that McCollum has released a poll showing them running dead even.

A new Sooner Poll of the Oklahoma Democratic gubernatorial race (the primary is on July 27) shows Attorney General Drew Edmondson holding just a one-point lead over Lt. Gov. Jari Askins.

Rasmussen has three new general-election gubernatorial polls out. In Texas, they show Rick Perry with a 48-40 lead over Bill White, although White has a somewhat better approval-disapproval ratio than the incumbent. In Tennessee, they show all three major Republican gubernatorial candidates with double-digit leads over Democrat Mike McWherter. And in Arkansas, Democratic incumbent Mike Beebe enjoys a 57-33 lead over Republican nominee Jim Keet, a slightly higher margin than he had in May.

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Alabama Primary Saga Continues

Tuesday, June 15th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

After the cornucopia of primaries on June 8, the electoral schedule is slowing down for a bit. The next votes are on June 22, with three statewide runoffs (South Carolina, North Carolina and South Dakota) and the Utah primary.

But perhaps the most interesting set of developments over the last few days involves Alabama’s Republican gubernatorial contest, where the extremely narrow margin between second-place finisher Robert Bentley and third-place finisher Tim James has created a legal and political mess.

Alabama is one of those states with a relatively decentralized election system, particularly for primaries. There’s no automatic recount system, and technically, no such thing as a statewide recount. So a candidate like James, who is looking for 167 votes to overtake Bentley, must pursue a recount county-by-county, through county party committees utilizing volunteers, all at his own expense.

As James was gearing up for that effort last week, along came Attorney General Troy King — a Republican who got trounced in his effort to get renominated on June 1 — with an opinion holding that no challenge to the primary results could be launched until a nomination had actually been made — i.e., after the runoff. This Catch-22 situation didn’t persuade James to abandon his recount effort, but it appears that if the recount does put him into the lead, the best party leaders could do for him is to schedule a runoff after the runoff — essentially a round-robin — where he’d face the winner of the contest between Bentley and first-place finisher Bradley Byrne. As Chuck Dean of the Birmingham News says:

That scenario is keeping Republican Party state Chairman Mike Hubbard from getting a good night’s sleep.

“It’s a potential mess,” said Hubbard. “All we can do at this point is follow what the attorney general says is the law and the rec­ommendations of the secre­tary of state and then see what we see. If the recount shows Bentley still in the lead, then I guess this is all over. If the recount shows James pulling ahead, then all I can say is, hold on.”

The only person enjoying this mess is probably Democratic gubernatorial nominee Ronnie Sparks.

In other runoff news, third-place finisher Henry McMaster has endorsed all-but-certain South Carolina Republican gubernatorial nominee Nikki Haley in her runoff against Rep. Gresham Barrett (R-SC).

Poll Watch

In polling news, Magellan Strategies has a new Louisiana survey out that illustrates the dominance of the oil and gas industries in that state’s economy, with respondents favoring an expansion of offshore drilling by a 72-15 margin.

PPP has released the first major survey of the Illinois Senate race since Rep. Mark Kirk’s (R-IL) issues with his military record emerged. It shows Democrat Alexi Giannoulias edging back ahead of Kirk by a 31-30 margin with a big undecided vote.

And a new Battleground poll for NPR, jointly conducted by the Democratic firm Greenberg Quinlan Rosner and the Republican firm Public Opinion Strategies, focuses on 70 competitive House districts, sixty of which are currently held by Democrats. It shows Republicans with an overall 49-41 lead in these districts, including a 47-42 lead in Democratic districts. As Stan Greenberg put it: “In a year where voters want change and in which Democrats are seen to be in power, this is a tough poll — about as tough as you [can] get.”

Photo Credit: StuSeeger

Ed Kilgore’s PPI Political Memo runs every Tuesday and Friday

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Money Talks in the Sunshine State

Friday, June 11th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

If you want to hear how loudly money can talk in politics, check out the new Quinnipiac survey in Florida. Two very rich men who leapt into statewide contests very late are doing very well.

One of them is Republican Rick Scott, a former for-profit hospital exec who was forced from his job amidst a massive fraud investigation, and then won fame by putting together national-level anti-health-reform ads. He leapt into the governor’s race very late, and now, after a $7 million barrage of ads that mostly express his support for Arizona’s immigration law, he’s leading conservative warhorse Bill McCollum — whose time finally seemed to have come this year after two unsuccessful U.S. Senate races — by a 44-31 margin.

Meanwhile, in the Democratic contest for the U.S. Senate, already roiled by the independent candidacy of Gov. Charlie Crist, billionaire real estate investor Jeff Greene, who got into the race right before the end of qualifying just over a month ago, has moved into a statistical tie with congressman Kendrick Meek. Advised by Democratic bad boys Joe Trippi and Doug Schoen, Greene is playing the outsider card as hard as he can.

Neither of these guys has held public office or has any deep roots in Florida. Both have been questioned about their business ethics. But they’ve got the loot, and while political history is littered with the wreckage of ego-driven campaigns by rich people, more than a few have succeeded. And if you are Bill McCollum or Kendrick Meek, who were both focused on the general election until their rich challengers came out of the woodwork, it’s got to feel like Sisyphus watching that rock roll back to the bottom of the hill.

This item is cross-posted at The Democratic Strategist.

Photo credit: turtlemom4bacon

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In Idaho, a Palin Pick Goes Down; Contentious Primaries May Be Hurting GOP

Friday, May 28th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

The country remains largely focused on the Gulf oil spill going into the Memorial Day weekend, but the large batch of upcoming primary elections will keep candidates on the campaign trail and on every available communications medium.

One notable primary, Idaho’s, was held since our last update, and in the GOP competition to take on Democratic Rep. Walt Minnick, front-runner and national Republican wunderkind Vaughn Ward was beaten by state Rep. Raul Labrador, despite late personal appearances with Ward by Sarah Palin. Ward damaged himself with several gaffes, including incidents of apparent plagiarism in his speeches and a boneheaded debate statement suggesting that Puerto Rico is a foreign country. Meanwhile, Labrador (who was actually born in Puerto Rico) benefited from Tea Party support.

Next Tuesday primaries will be held in Alabama, Mississippi (whose state elections are in off-years) and New Mexico. The marquee contests then are the Democratic and Republican gubernatorial primaries in Alabama. Among Democrats, long-time front-runner Rep. Artur Davis is trying to hold off a late upswing in support for state Agriculture Commissioner Ron Sparks. Davis, an African-American, has ceded endorsements by four major African-American groups in the state to Sparks, who is white. That, along with Davis’ vote against health reform in Congress, seems to be fueling Sparks’ campaign, and the competition is getting a bit nasty down the stretch, with Sparks accusing Davis of breaking campaign finance laws and Davis running an ad accusing Sparks of discrimination at his agency.

The Alabama Republican gubernatorial contest looks to be boiling down to a question of whether Judge Roy Moore or Tim James joins state community college chancellor Bradley Byrne in a runoff. Byrne has strong business support, and is the closest thing to a moderate (by Alabama GOP standards) in the race. Moore is, of course, a Christian Right icon, and James, the son of a former party-switching governor, has sought to horn in on Moore’s political turf, helped by his own substantial financial resources. Byrne and James have been accusing each other, somewhat implausibly, of secret ties to the Alabama Education Association. And Byrne has gone after James’ famous “English-only” viral ad for threatening the foreign investment on which Alabama disproportionately depends. Believe it or not, James has had to deal with a rumor that he’s said he would cut the salary of Alabama football coach Nick Saban.

Campaigns are approaching red-hot status in many of the June 8 primary states. The hottest, and certainly the strangest, has been in South Carolina, whose Republican gubernatorial campaign was roiled this week by a conservative blogger’s claim that he had an “inappropriate physical relationship” with front-running candidate state Rep. Nikki Haley. She’s denied it categorically, and the blogger and Haley’s campaign have engaged in a cat-and-mouse game where the former has slowly released highly circumstantial “evidence” based on text message and cell phones records, and the latter has challenged the former to come forward with real evidence or shut up. Haley seems to be winning the p.r. battle the state so far, and today, the saga could take a new turn as RedState blogger Erick Erickson, one of Haley’s legion of national conservative supporters, is promising to release evidence that the accuser was paid to make the allegations (possibly by someone connected with a rival campaign). Interestingly, the whole story broke as Haley surged into the lead in polls; her most likely runoff opponent is Attorney General Henry McMaster.

In California’s torrid Republican primaries, it’s becoming reasonably clear that Meg Whitman is finally putting away Steve Poizner in the governor’s race (though Poizner is now staking everything on attacking Whitman’s opposition to the Arizona immigration law), and Carly Fiorina seems to be suddenly pulling away from Tom Campbell and Chuck DeVore in the Senate race.

In Nevada, the Republican primary to choose an opponent for highly vulnerable Senate Majority Leader Harry Reid has turned into an unpredictable three-way fight, with long-time front-runner Sue (“Chickens for Checkups”) Lowden trying to hold off Tea Party favorite Sharron Angle, with Danny Tarkanian not far back.

But in both California and Nevada, there are growing signs that Republican primary infighting could damage the GOP in close general election battles. In CA, the vicious and incredibly expensive Whitman-Poizner contest has been accompanied by a steady rise in the polls by Democrat Jerry Brown. The focus on immigration in the GOP race probably won’t help the party’s already fragile relationship with Latino voters, either.

And in Nevada, Harry Reid, once left for dead by most observers, is creeping back into close contention with his potential GOP opponents, actually leading the rapidly surging Sharron Angle.

UPDATE: Another strange turn in the Nikki Haley saga in South Carolina, as RedState’s Erick Erickson finally released a post following up his promise yesterday that he had the goods on someone paying big money to blogger Will Folks to smear Haley, and would “name names.” In what was apparently an attempted send-up of Folks’ own methodology, Erickson offered no evidence of a payoff at all, but instead simply expressed his own weakly documented suspicions that Lt. Gov. Andre Bauer might have had something to do with it. Hilarious, eh?

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New Poll Shows Tradeoffs on Immigration

Thursday, May 27th, 2010
Ed Kilgore


Ed Kilgore is a PPI senior fellow, as well as managing editor of The Democratic Strategist, an online forum.

by Ed Kilgore

It’s been pretty obvious for a while that there’s a major split between Hispanics and non-Hispanics on the immigration policy furor sparked by Arizona’s new law authorizing state and local law enforcement agencies to enforce federal immigration laws.

A new MSNBC/NBC/Telemundo poll helps outline the political choices this situation poses for both parties.

To put it simply, white Americans tend to support the Arizona law while Hispanics tend to oppose it, by roughly even two-to-one margins. But the internals of the poll tell a more interesting story. The short-term advantage to Republicans of loudly backing the Arizona law is reinforced by the fact that many Democratic-leaning voters — notably suburban women and women over 50 — say they’d look favorably on candidates raising Arizona. And the long-term problem for Republicans is reinforced by the finding that hostility to the Arizona law — and to the GOP — is especially strong among younger Hispanics.

Complicating the picture further is the fact that a sizeable majority of all Americans (60-29) continue to support some sort of comprehensive immigration reform with provisions that include stronger border security and sanctions against both employers of undocumented workers and the workers themselves–short, however, of deportation. (This is what Democratic Strategist Co-Editor Ruy Teixeira has been pointing out). And big majorities want Congress to do something about the problem.

This last finding may tempt Democrats to move ahead with comprehensive reform in Congress, heightening Hispanic hostility to alternative approaches while convincing non-Hispanic voters that it’s possible to increase enforcement without deportation schemes or potential harrassment of citizens and legal immigrants. But as Jon Chait notes today, certain GOP obstruction of comprehensive immigration reform legislation might simply increase the frustration of both Hispanic and non-Hispanic voters about the status quo, while shifting attention away from Republican extremism on the subject. And as William Galston recently argued, highlighting this issue is a perilous strategy for Democrats, given the likely composition of the 2010 electorate.

There are big risks and big tradeoffs for both parties in making immigration a big issue in 2010. I doubt Republicans in most parts of the country are going to be able to keep themselves from expressing solidarity with Arizona and trying to make this a wedge issue. Democrats need to be more consciously strategic than that, which probably means a principled position that avoids the extremes of “amnesty” as well as deportation or ethnic profiling by law enforcement agencies — but that also makes Republicans play offense on immigration, and lets them become truly offensive.

This item is cross-posted at The Democratic Strategist.

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