Bush / GOP

Who's In Charge?

Another crisis has emerged on top of the unraveled financial system, hyper-volatile stock markets, and accelerating economic downturn: There’s no one at the helm of the economy or the piecemeal bailout and the other schemes devised to make it right. President George W. Bush is nearly absent and his credibility is exhausted. The Treasury Secretary’s authority is only slightly less damaged, and he cannot commit the nation to new policies. And now the Congress has left the city to campaign. The two presidential candidates, including whichever one becomes the next president, cannot assert any authority even if either of them wanted to. There’s no Congress around to pass on what Obama and McCain might call for. Further, President Bush couldn’t respond to an Obama recommendation without undermining his party’s candidate, nor respond to a McCain proposal without reinforcing the Democrats’ case that the two are in joined at the brain.

So, the economic crisis has continued to worsen. The problems in housing, finance and now the overall economy aren’t on recess, nor will they hold their fire until the next president is inaugurated. In fact, more economic and political problems will emerge. For example, last week, three of the nine banks slated to get the first bags of cheap, federal bailout money reported very respectable third-quarter profits. Wells Fargo, State Street Bank, and J.P. Morgan-Chase together earned profits of $2.6 billion for the quarter, even as they agreed to accept $25 billion each in cheap, new capital from American taxpayers.

Of course they agreed: The money will cost them 5 percent or half of what Warren Buffet received for his $5 billion capital investment in Goldman Sachs last month, so now they can expand their businesses at a cut rate. The CEO of J.P. Morgan-Chase called his $25 billion injection a “growth opportunity.” By what methods of accounting do they need emergency government assistance? And where are the deciders in the administration? The Treasury spokesperson said, ‘We are not here to make money off these companies,’ a view which almost certainly would draw sharp attacks from most members of Congress if they were here, as well both campaigns and most Americans. In fact, if interest rates rise before the banks pay back the government’s gifted capital, these loans to healthy, profitable banks will actually cost taxpayers plenty, since every cent of their $75 billion will be borrowed, and the recipients are paying below-market rates.

Presumably, the Treasury has criteria for extending these bailout loans, but since there is no transparency and, with Congress gone, no one to call for it, we cannot know what or whose criteria they are. But what could those criteria be, if sound, profitable banks qualify for emergency capital infusions? With a sinking economy and millions of Americans facing unemployment and home foreclosures, is it the first priority of those in charge to finance new growth opportunities for profitable banks? Is that the government’s reward for their managing to avoid bankruptcy? In fact, it looks like one of the final acts of an administration that now has injected a big dose of Asian-style “crony capitalism” between the most senior officials of the White House and the Treasury, and Wall Street.

This is happening, in part, because in the midst of genuine economic crisis, the United States is nearly leaderless. British Prime Minister Gordon Brown and other European leaders last week called for a ‘Bretton Woods II’ summit to redesign the global financial architecture, and last weekend President Bush called for his own summit. The Brits and Bush both want everyone to meet within a few weeks to begin the figure out how the International Monetary Fund, World Bank and the Bank of International Settlements should operate in this new era and, presumably, to discuss new terms for overseeing capital flow among countries. Who would speak for the United States? It’s likely that Barack Obama will be president-elect by the time they meet, but he still won’t be president and therefore unable to exercise presidential authority. The man who will still be president, George W. Bush, will also be utterly without domestic support or credibility in economic matters, with no means of selling a new international package to the American people or Congress. These kinds of issues come up during any presidential transition; but they’re especially worrisome this time, because we find ourselves in the middle of a cascading economic crisis that will not wait until next January.

Senators Obama and McCain need to prepare now. Both candidates should convene a group of trusted economic advisors to review the current options for dealing with the deteriorating housing market, the instability in our financial system, and the real economy’s accelerating problems, without reference to the campaigns. This group should report its findings and recommendations to the president-elect on November 5, and he should present his recommendations to a lame-duck Congress that same week. Campaign operatives may assume we have until January, but the man who becomes president-elect must know that he will have to take action as soon as the votes are counted.

NDN: Week in Review

There's always a lot happening here at NDN, so in case you missed anything, here's what we've been up to in the last week:

A Stimulus for the Long Run - Post-election, Congress will head back to Washington to consider another stimulus package. NDN Globalization Initiative Chair Dr. Robert Shapiro and Green Project Director Michael Moynihan have been weighing in on the need to create a package that jumpstarts the economy now and helps ensure future prosperity by working to create a low-carbon economy. In a recent essay, Shapiro argued for a “Stimulus for the Long Run” that invests in clean infrastructure, worker training, and technology. In a separate memo, Moynihan also made the case for Accelerating the Development of a 21st Century Economy: Investing in Clean Infrastructure. The bottom line: Congress has a limited amount of money to spend on a stimulus.

Election Forum with Joe Trippi and Simon Rosenberg - Yesterday, NDN hosted a special lunchtime Election Forum with NDN President Simon Rosenberg and Internet pioneer, top political strategist and New Politics Institute fellow Joe Trippi. Joe and Simon looked at this remarkable election cycle and also beyond November 4 to the next Administration. For more information and photos from the event, please click here.

NDN Countdown to Election 2008 - With less than a week to go before Election Day, the NDN team continued to weigh in on issues ranging from swinging poll numbers to donation-fueled shopping sprees to early voting. With the media reporting U.S. Sen. Barack Obama with anywhere from a double-digit to a single-digit lead over U.S. Sen. John McCain, Simon asked, "Is McCain Playing to Win?"

Simon's essay echoes what he and the NDN team have been saying for several weeks: we may see an uptick in McCain's numbers as the race enters the final days, but that's because the Arizona senator is gaining ground he already should have held. It's not a sign of McCain's strength; rather, it's a sign of his weakness and disappointing campaign that many in the GOP base are only now coming home. For more on the final days of the campaign, check out this report from yesterday's Newsday, which quotes Simon.

Simon also predicted that increasingly, we will start to hear quiet talk of realignment, blowout, rout, coattails and a new political era. If the trends continue, we are headed toward a true blowout with the top of the Democratic ticket getting its highest vote share since 1964, Democrats having more ideological control of Washington since the mid 1960s and Democrats having the makings of a new very 21st century majority coalition they could ride for the next 30-40 years of politics.

And the other big news last week? What about Gov. Sarah Palin slapping her hockey Mom image right out of the rink by spending $150,000 on designer clothes and make up? Chalk it up the Republicans’ being completely out of touch with the economic struggles of everyday people. Melissa also took a look at an interview Palin did with James Dobson, the immensley popular leader of “Focus on the Family.” While Palin has apologized for some of her more divisive rhetoric as of late, she played to Dobson’s audience in this interview, even seeming to contradict McCain's more moderate stances on several issues, including stem cell research, choice and gay marriage. Is Palin thinking conservative base in 2012?

Back to the here-and-now, Andres Ramirez, Vice President of Hispanic Programs, spent the week focusing on the subject of early voting. With one in three registered voters expected to cast their ballots before November 4, Andres wrote about the record-breaking numbers of early voters, how many of those voters are experiencing very long waits to vote and efforts to prevent people from voting or purge newly registered voters from the rolls.

Keep People in Their Homes - For more than a month, NDN has been arguing that any government response to the financial crisis must include a central provision to keep people in their homes. Momentum to do just that grew last week, as FDIC Chairman Sheila Bair testified before Congress and presented a proposal to keep people in their homes, and the New York Times editorialized on the issue. The Washington Post reported that Bair’s proposal received a warm reception from lawmakers, a welcome sign that the federal government will soon provide necessary leadership in this effort. For more on NDN’s Keep People in Their Homes effort, click here.

Other NDN Thinking - There are no lack of victims from the meltdown of the financial markets and the oncoming economic recession. Will moving toward a low-carbon future, a top priority for NDN, be one of them? Our answer is “no.” Jake Berliner argued that Energy Reform Can Be an Economic Boon. Green Project Director Moynihan further buttressed Jake’s arguments in his essay, Climate Change: Next Steps in a Troubled Economy. Zuraya Tapia-Alfaro looked at Barack Obama’s latest Spanish-language ad about restoring the “American Dream,” following other Spanish-language TV and radio ads on education, health care, taxes, and more. She also wrote about immigration in the presidential race and how the next president can discuss immigration reform using an economic narrative during this time of economic crisis.

New Tools Feature: Go Mobile - In last week's New Tools Feature, TXT 2 GOTV, I highlighted a new study that shows the great bang-for-the-buck efficacy of text-based get-out-the-vote campaigns, which, on average, cost only $1.56 per vote. To learn more about using SMS messaging effectively, be sure to read our New Politics Institute's New Tools paper, Go Mobile Now. While texting has already had a real, measurable effect in this election cycle, and will be critical to getting out key voting blocs next Tuesday, the true potential of mobile-powered politics has yet to be tapped.

NDN Breaking Through - The new VIBE Magazine hit shelves last week. For the first time in its 15-year history, VIBE endorsed a candidate this month. Simon is quoted in the cover story, "The Tipping Point," about race in American politics and the historic implications of the rise of U.S. Sen. Barack Obama.

Simon also provided analysis of the election in the Independent, Reuters (and subsequently on Michael Moore's blog), and in two featured posts on the Huffington Post (here and here). His election commentary also aired on radio stations across the country, and he was featured on WAMU's "Power Breakfast": you can listen to the segment here:

Finally, Rob was quoted in a big story in the New York Times and the International Herald-Tribune about the Treasury backing the consolidation of banks, and Michael had a featured post about dealing with climate change in a troubled economy in the Huffington Post's Green section.

Rooting for the Winner

Obama WinningThe press is pulling for a close election, and doing their best to report it as one, but all the indicators point to Obama continuing to widen his lead. With everyone expecting McCain to make a run, why isn't it happening?

My feeling is that it has to do with one of America's most cherished traditions: Love for winning.  Though most Americans might have favored John Kerry's policies in 2004, or Al Gore's experience in 2000, George Bush knew how to talk like a winner.  He looked like a winner.  He was confident and sure of himself. The same was true of Bill Clinton, and people gravitated toward him.

Since the conventions, McCain has looked increasingly like a guy who's about to lose an election.  He's nervous, he stumbles in his speeches, he looks awkward on stage, and his campaign is all over the place.  Obama, by contrast, looks ever more presidential. In the debates he was calm, cool, well-spoken and connectable.  He's acting like a winner, and everybody wants to be on the winning team.

This has created a positive feedback loop for Obama: The further ahead he gets, the more he looks like a president, and the more confident people become in his abilities.  I still think it's reasonable to expect McCain to pick up a few points in the polls, but most of America is now expecting-- and looking forward to-- a President Obama.

Palin to Appear on Spanish-language TV

As promised, Palin did give an interview to Jorge Ramos, of Univision, which will be aired on the network's Sunday morning political show, Al Punto, this weekend.  Here's a sneak peek of the interview: she talks about Hugo Chavez, Colin Powell's endorsement of Barack Obama, and Immigration.  On immigration, Gov. Palin accepts that it's impossible to deport all the undocumented, and she emphasized Sen. McCain's view of "enforcement first" as the appropriate path to follow.  When asked if she'd stop the immigration raids, Gov. Palin said she couldn't say that she would, but rather would need to take a case by case approach. 

Joe Garcia v. Mario Diaz Balart on "Al Punto"

Yesterday on "Al Punto", Univision's Sunday morning political show, challenger Joe Garcia (D) and incumbent Mario Diaz-Balart (R), had an animated debate on issues ranging from the economic rescue package and Iraq, to Cuba policy and the Colombia FTA. Both are running for the seat in the U.S. House of Representatives representing Florida's 25th district, which encompasses the western portion of Miami-Dade County, including the Everglades National Park. This heated race is a perfect example of what's happening throughout the U.S. - as the country becomes less hard-line Republican or Democrat, more and more "stronghold" districts and states shift into "tossup" territory. Southern Florida, previously considered a solid Cuban-American and Republican area, is changing due to changes in demographics and largely in response to the way the economic crisis has affected this state in particular. Joe Garcia painted Diaz-Balart's vote against the first economic rescue bill as "too little too late" after having had a history of voting with President Bush on all the bills that led to this current economic downturn, siding with "special interests". And Mario Diaz-Balart attempted to paint Joe was a well-versed man with no specific solutions...sound familiar? Yes, much like the Presidential race. On the issues:

On the economy: Mario voted against the rescue bill because he didn't want to give the banks a "blank check", to which Joe responded that he already had - voting to give banks the blank checks through deregulation and by allowing bills to pass that increased credit card interest rates up to 29%. Joe pointed out that while the rescue bill needed safeguards to keep people in their homes, the danger lay in doing nothing, and that he would have voted for the bill to take action to save people in this crisis.

On healthcare: Mario is against nationalized healthcare and proposed to leave insurance decisions in the hands of individuals. His proposal would be to allow for inter-state competition of health care plans. Joe on the other hand, supports Sen. Obama's plan to create a national system of health care. Unlike Mr. Diaz-Balart, Mr. Garcia pointed out the lack of health care in the Hispanic community in particular, and the importance of lowering costs and increasing competition.

On Cuba: Both candidates are firmly against participating in any diplomatic meeting with the Castro brothers, however, Mr. Garcia is for lifting the travel ban on families, and decreasing the restrictions on remittances to Cuba. Mr. Diaz-Balart is firmly against holding talks or contact with Cuba and against fully lifting the travel ban.

On Colombia: Both candidates are for the passage of the FTA. Mr. Diaz Balart noted that President Uribe has been incredibly successful at decreasing the murders of labor leaders and improving security in the country.

Weekly Update: The Economy and Immigration Reform

Given the current state of the U.S. economy, it surprises me that not more is said about immigration on all the major news networks. I see a silver lining during this economic crisis for immigration reform, thinking back to a story in the CQ by Karoun Demirjian, "Immigration: The Jobs Factor." While some might feel that opposition to comprehensive immigration reform (CIR) might become more intense during an economic crisis, there is reason to believe that opposition could actually lose momentum. Politically, the economic crisis might actually provide some cover for CIR negotiations, and Members of Congress might have more leeway to discuss the issue thanks to the focus on the economy.

Additionally, immigration has been an issue of top concern among Hispanics. What I hear from many Hispanic voters who call in to Spanish language radio or tv shows and in my community is that they are skeptical as to whether either candidate will deliver on CIR. Unlike McCain, who has abandoned the Hispanic community on immigration, Obama has been able to make it clear to Hispanics that he is committed to passing CIR, which has largely led to his over 30 point lead among this demographic. However, were he to win this election, I think he would just as easily lose this demographic if he did not deliver on this promise. It's also important to remember that members of Congress up for reelection in 2010 have much more to lose by putting off immigration reform. Polling indicates that voters place the blame of the broken immigration system on Congress by an overwhelming majority. Therefore, taking on the issue would change the perception of a do-nothing Congress.

Tthe mantra that emerged out of the failure of last summer's congressional immigration plan - "secure the borders first" - is losing its momentum. With the current economic crisis leading to the number of undocumented immigrants declining, it's becoming clear that the "magnet" of undocumented immigration is being eliminated. Which gives those of us for CIR an opening to discuss, what comes next?

The next President will have to recognize the challenges ahead:

1) Building a large enough coalition in Congress.
Even with the expected Democratic gains in both chambers, he will have to work with Members from the anti-immigrant House Immigration Reform Caucus, which backs enforcement-only, as well as with Members of the Congressional Hispanic Caucus and the "Blue Dog" Caucus.

2) Growing administrative challenges. As stated by Marshall Fitz, Director of the American Immigration Lawyers Association, "It's not clear how much change Sen. McCain could make within DHS, because certainly he would be in a very politically compromised position, given where his party is on these issues." But that's not to say Sen. Obama will have complete flexibility in regards to halting or limiting enforcement measures.

3) The next White House will inherit a badly overburdened immigration court system.

4) Reform costs money. At a time when federal revenue will be contracting on a significant scale. That makes it, in turn, all the more incumbent on either McCain or Obama to forge a renewed political consensus behind such a plan.

Given the candidates' current proposals on immigration, only Sen. Barack Obama would be able to utilize the economic and policy landscape to build new coalitions in Congress and improve the White House Executive management of immigration policies. Sen.McCain has proven that he is unwilling to act in ways contrary to his party, which remains vocally anti-immigrant. So what could a new president do? - He should be proactive, not reactive on this issue:

1) The slowing economy helps prove that the it's not "enforcement only" that has led to a decrease in illegal immigration, "it's the economy stupid!", thus relieving some pressure from this explosive issue, which allows CIR proponents to argue that now is the time to act to take control of the system - before the situation becomes more critical.

2) Develop an economic narrative, and revive the strong coalition of business, community, religious, and academic groups to advocate in Congress. As noted in the piece, businesses have suffered under the "enforcement only" strategy:

As small-business credit seizes up and unemployment increases, going after businesses providing jobs....is not playing well among most constituencies, apart from hard-line immigration opponents. Indeed, lobbyists and managers in other potentially vulnerable companies - such as high-tech concerns and seasonal industries - are already contending that they need access to specialized non-U.S. workers now more than ever.

I would add that under the current administration it's the unscrupulous employers who have been provided "amnesty". Passage of CIR under a new administration would call for interior enforcement as well as border enforcement, while at the same time providing adequate protection to workers and families. Not just immigrant workers would benefit from wage and labor safeguards under CIR - all businesses and workers would benefit.

Others argue that the undocumented drive wages down - the next president should make those individuals understand that by bringing the undocumented out of the shadows we will push wages up, and by making sure they become full-fledged members of our society and economy at a time of economic downturn, we will add revenue to our tax base and to our communities. As illegal aliens become documented, they will earn more and spend more.

We found an interesting piece of information during NDN's latest poll on immigration: There is a positive view of immigrants among the general population, which is conducive to passing immigration reform - 68-69 percent of voters in four battleground states believe that illegal immigrants come to this country to "get a job and a better life", as opposed to the 10-12 percent who believe they come to "take advantage" of our public programs, and 60 percent believe that immigrants take "jobs no one else wants" as opposed to "taking American jobs." And yet, when they are asked whether undocumented immigrants help or hurt the economy, 40-47 percent believe they "hurt the economy by driving wages down." In Nevada, where immigrants comprise a significant percentage of major sectors like construction and services, 47 percent of those polled believe they hurt the economy, while 39 believe they help.

However, Hispanics "get" the economic argument. Among Hispanic voters polled in Nevada for example, 64 percent believe illegal immigrants help the economy, while only 22 percent think that they push wages down.

During such a dramatic economic downturn, CIR will help improve the rights and wages of all workers. Legalization of the undocumented will push wages up and to add to our tax base and it will help businesses by providing a more secure labor force and larger consumer base, which provides common ground with which to join different Congressional and other factions on the side of CIR.

3) Look to the future. Immigration reform would require funding; the next President will have to make Congress and the American people understand that this is an investment in the country's future. While the decrease in illegal immigration might make reform seem less urgent, there is an urgency to reform our broken immigration system, including the visa and temporary worker systems, and deal with future flow. The next president needs to make this clear at a time of economic crisis:

"People see those visas, incorrectly, as enabling immigrant workers to compete with American workers. We'd like to see an administration move forward. Congress is always reactive, instead of looking down the pike, and looking at the demographics of our country. When the economy comes back, we're going to need these workers even more."

4) Modify and deal with backlogs and enforcement measures through executive branch appointments and administrative rulings. The next president will have this ability, which is another reason why there is so much at stake for immigration reform in this election.

5) Work with other countries. As stated in the Democratic Party Platform on immigration, it will be necessary for the next president to work with immigrant-sending nations in order to address the conditions that cause immigration in the first place.

In conclusion, immigration Reform can be repackaged as an item in a broader economic agenda that helps relieve some of the downward pressure on U.S. wages and benefits. Today, undocumenteds account for 5% of the total workforce in the United States. Bringing them all the minimum wage, the ability to join a labor union and other protections guaranteed to all American workers will help remove some of the downward pressure on the low end of the income scale, making CIR a strong companion to the Democratic Caucus's successful effort to raise the minimum wage early in the 110th Congress.

More Powell

After his Meet the Press Interview this morning, General Powell did an informal presser, where he repeated some of what he said earlier, but also added some additional observations.  I saw it live on CNN and found it very powerful.  You can watch it here on Daily Kos.

$1 Trillion Deficit Projected Next Year

At this point there is almost nothing that Bush touched that he didn't break:

Congressional leaders and both presidential candidates are proposing billions of dollars in tax breaks and other measures to stoke economic growth, a surge in spending that could send the federal deficit soaring toward $1 trillion this year, creating the deepest well of red ink since the end of World War II.

The government already has embarked on an unprecedented spending spree to halt the implosion of the U.S. financial system and is borrowing money at levels that some economists fear could undermine the nation's economic security for years to come. Congress could consider additional spending as soon as next month, potentially digging the nation's hole even deeper.

"We're going to make Ronald Reagan look like a piker in terms of deficit creation, I think," said Rudolph Penner, a senior fellow at the Urban Institute who served as director of the Congressional Budget Office during the Reagan administration.

The numbers are adding up fast. Since President Bush signed an economic stimulus package in February, authorizing billions of dollars in rebates for American taxpayers, the government has pledged as much as $1.5 trillion to prop up the teetering economy. It has approved new mortgages for struggling homeowners, salvage operations for faltering financial institutions and a historic $700 billion bailout plan to pump money into banks paralyzed by the financial crisis.

The Treasury Department so far has borrowed nearly $500 billion from pension plans, foreign governments and other investors to replenish the coffers of the Federal Reserve. Since the end of August, the national debt has jumped from $9.6 trillion to $10.3 trillion, with borrowing for the bank bailout yet to come.

Meanwhile, the budget deficit -- the annual difference between government spending and tax collections -- has risen rapidly. It jumped from $162 billion last year to $455 billion in the fiscal year that ended in September, largely because of the cost of the stimulus package, as well as slowing tax revenues and rising expenses in Iraq and Afghanistan.

The budget picture looking forward is even bleaker. While the deficit is projected to be about $550 billion for the fiscal year that began Oct. 1, budget analysts have yet to figure in the effects of a recession, which could easily tack on another $100 billion. They also have not included the first $250 billion being spent on the bailout plan, which the White House budget office said this week must be added, even though much if not all of the money is eventually expected to be returned to the Treasury.

And with options for a second round of stimulus spending starting at $52 billion -- the size of the package proposed earlier this week by Republican presidential candidate John McCain -- it's not hard to imagine the deficit rising to $1 trillion. That would approach 7 percent of the economy, a yawning budget hole not seen since 1946.

Some economists say that prospect should dampen talk of further spending. Others say it's better to spend the money now in an effort to protect jobs and smooth over the harshest effects of a recession than to lose the money later through sharply lower tax collections and higher unemployment payments. Economists advising House Democrats are urging a spending package of as much as $300 billion, arguing that the economy could shrink by about that much over the next year.

Read the rest of the story from the Washington Post here.

Hispanics Hand it to Obama

Obama's most important lead after last night's debate may have come among Hispanic voters, who favored him by a 50-36 percent margin according to the national Politico/InsiderAdvantage survey of undecided debate-watchers. The candidates were evenly matched among white voters, with McCain holding a 49-46 percent advantage - equal to the three point margin of error. African Americans picked Obama as the winner by 88-10 percent. You can trace Hispanics' support of the presidential candidates through Gallup's weekly poll - the poll shows Obama with a consistent comfortable margin of at least 20-25 points ahead of McCain. The latest Gallup poll shows Obama ahead by a 60-31 percent advantage.

Why the Plumber Story Doesn't Hold Water

As Melissa just pointed out, the star of last night's debate was Joe the Plumber (who does not hold a plumbing license, makes less than $250,000 a year and has not paid his taxes anyway, rendering the whole argument utterly moot). US Sen. John McCain brought Joe up in order to paint US Sen. Barack Obama's tax plan as class warfare - he accused Obama of wanting to take Joe the Plumber's wealth and spread it around (although in liberally-biased "reality," it turns out that Joe would actually receive a tax cut under Obama's plan), and repeatedly asked why Obama would want to raise taxes on anyone in these difficult times. McCain even asserted that there could be no possible justification for Obama's tax plan.

Really, Senator McCain? How's this for a start; Obama's tax plan does nothing more than to partially (and not even completely) reverse Bush's tax policy. Under the Bush tax cuts, which Senator McCain supports and wants to extend, the bottom 20% of earners got 1% of the tax cuts, while the top 1% got a whopping 33%. The top 5% got almost 50% of the tax cuts.

This isn't just a problem of fairness, as Joe Biden argued in the vice-presidential debate (although this question of fairness in our tax structure certainly merits a more sustained philosophical discussion). It also happens to be bad economics; because lower and middle-income people have a higher marginal propensity to consume, more of the money that goes to them in tax cuts goes back into our economy, resulting in a larger multiplier effect and a greater increase in aggregate demand. This, of course, is simple common sense; give tax breaks to the people that actually NEED them, not the top 1% who are already making an average of $13+ millon a year.

The growing inequality in our country is making our economy increasingly unstable and our current form of government untenable and unsustainable. But don't just take my word for it: ask the most recent winner of the Nobel Prize for Economics, Paul Krugman. In a fantastic piece from 2003 in the New York Times Magazine entitled "The Tax-Cut Con", Mr. Krugman laid out a prescient analysis of where the Bush economic policies would lead us. It turned out that he was right, yet Senator McCain continues to espouse the same flawed and discredited economic arguments. It is high time that progressives pushed back, hard. At the end of this must-read article, Krugman says this:

The astonishing political success of the antitax crusade has, more or less deliberately, set the United States up for a fiscal crisis. How we respond to that crisis will determine what kind of country we become.

If Grover Norquist is right -- and he has been right about a lot -- the coming crisis will allow conservatives to move the nation a long way back toward the kind of limited government we had before Franklin Roosevelt. Lack of revenue, he says, will make it possible for conservative politicians -- in the name of fiscal necessity -- to dismantle immensely popular government programs that would otherwise have been untouchable.

In Norquist's vision, America a couple of decades from now will be a place in which elderly people make up a disproportionate share of the poor, as they did before Social Security. It will also be a country in which even middle-class elderly Americans are, in many cases, unable to afford expensive medical procedures or prescription drugs and in which poor Americans generally go without even basic health care. And it may well be a place in which only those who can afford expensive private schools can give their children a decent education.

But as Governor Riley of Alabama reminds us, that's a choice, not a necessity. The tax-cut crusade has created a situation in which something must give. But what gives -- whether we decide that the New Deal and the Great Society must go or that taxes aren't such a bad thing after all -- is up to us. The American people must decide what kind of a country we want to be.

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