Lying Ryan

What the hell is wrong with Paul Ryan? He recently tried to blame President Obama for a GM plant closing in Janesville, Wisconsin, as if Republican obstructionism had no role. Worse, Ryan, Romney, and nearly everyone in their party said at the time that Obama was wrong to intervene to save GM. This was shortly after the Janesville plant closed. Romney also made it clear that government should let GM go bankrupt.

Ryan blamed the lost jobs at Janesville, which is in his congressional district, on Obama. Did Obama not intervene? Did GM not survive? Ryan wants you to ignore the fact that GM is still in business, meaning many plants are up, operating, and profitable, but attacks Obama for not saving that one plant that happens to be in Ryan's district.

Ryan wants it both ways. Government should not intervene in commerce; the free market has the solution. Yet he chides Obama because workers in Ryan's district lost their jobs precisely because, he says, Obama did not act to save that specific plant. I thought you guys loved the Randian free market rough and tumble; you know, creative destruction and all that? And is there any one out there who doesn't acknowledge that GM had no choice but to shed manufacturing output?

The final irony to this is that GM closed the plant in 2008, under George W. Bush. Ryan is so determined to score cheap political points that he got his story completely screwed up.

A more complete chronology, complete with video, can be found here.

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There is a small addendum to the Janesville plant story: it made SUVs. People are moving away from them for very rational reasons. Ryan and others want to blame the plant closing on Obama because of high gas prices, overlooking the fact that gas prices have been affecting sales of SUVs for years. They're also ignoring the intense market competition within the segment. This crap about high prices makes Americans look stupid; we have the lowest gas prices in the industrialized world. The real motivator in politics is that so many of us are addicted to the idea of perpetually cheap gas. We want a world where gas is so cheap we can drive gas-guzzling behemoths with impunity. The trend towards smaller, more fuel efficient cars, towards hybrids and, gasp, electric ones, towards the legitimacy of downsizing and public transportation, is inevitable.

Factor in global warming, pollution, and the growing role of solar and wind power. All of this has been embraced by liberals here as well as significant majorities in other countries, many of which have become demonstrably more fuel-efficient than the US, and environmentally cleaner to boot.

And it bugs the shit out of Republicans.

GM Finally in the Black

I see that General Motors has posted an impressive $4.7 billion in profits for 2010. This was the first profitable year since 2004 and the highest profits in more than a decade. Not bad for a company that was comatose and out of options when Obama chose to act. You will recall that Republicans, more ideological than practical, said that government could not possibly help the situation and demanded that it be dismantled and left to die. They must have forgotten that Chrysler received government aid during Reagan's tenure.

You can see the full story at The New York Times, and The New Republic.

Yet another huge company going under, with thousands of lost jobs? Precisely what Republicans want to see happen on a Democrat's watch. Ain't gonna happen.

And now how about some ovedue credit to the Obama administration, which has so far proved its Republican naysayers wrong? That won't happen either.

They Will Never Be Satisfied

President Obama continues to get very little credit for what his administration has accomplished. He has lost some support with progressives because he has yet to make good on issues that matter to them, including DADT, overturning heavy-handed Bush-era policies such as indefinite detentions, Guantanomo, domestic wire-tapping, and that little thing called the (two) wars. Jobs continue to concern us all. And Wall Street reform, so proudly hailed by the White House, will do little to curtail the dysfunctional personalities that flock to finance, where greed, aggressiveness, and a sociopathic disregard for the welfare of others are so obscenely rewarded.

And yes, Obama, and numerous other Dems crapped out on health care reform. Although Fox News won't mention it, public support for a public option was very high during the negotiations. Support dropped only when it became clear that we were geting the shitty version, the one that allowed the insurance companies to continue to rip us off.  More than a few progressives now believe the White House never was committed to a public option. So there are reasons why many progressives, myself included, are ambivalent about his tenure so far.

Conservatives have no excuses for their animosity, other than to admit their addiction to partisan politics leaves them no choice but to continually confirm they are intellectual prostitutes.  And confirm they do: They look especially ridiculous as they howl that Obama has shackeled business, that the mini-reforms on Wall Street will destroy wealth, or that our deficits keep spiraling out of control.

The President deserves some perspective in light of the steaming pile that Bush handed him in January of 2009, coupled with the abject refusal of Republicans to offer anything other than exactly the policies that got us here.  Deregulate Wall Street? Tax cuts for millionaires? Attack the deficit by hobbling social security? That's why they are intellectual prostitutes.

Have a look at the chart below. It shows some data you will never hear from Mitch McConnell.

Right, five straight quarters of growth. The White House had the economy expanding after only six months. Don't think Obama was the reason? You can sure as hell bet the Bush or McCain White House would have stepped up to take credit. As it is, many in the media act as if the recession began when Obama took office and that eight years of Bush mismanagement never happened.

Now watch the video of Chris Hays sitting in for Rachel Maddow. Record profits for corporate America, rising stock prices, out-sized bonuses. They even got their auto industry back. It's all there.




This is a big fat Happy Thanksgiving for corporate America. Instead they whine. 

Updates on GM

GM has gone public again, and with significant investor interest. Many in the media seem to have forgotten how close to disaster GM came, and how dramatic the fallout would have been, at GM as well as its massive supply chain. 

There is a excellent write-up by "thebigotbasher" on GM's coming out party at The Conservative Lie. Give it a read. I'll just amplify here that Republicans are pretty miserable shits for trying to talk down GM's prospects. It seems clear they do not want to see GM succeed, at least for the next two years, because that success story will be forever linked to President Obama. They have been howling about Obama's heavy socialist hand on GM for months. They, of course, are suggesting that government do nothing, and let the magical free market pass its verdict on GM, and Chrysler as well. They do this because GM's failure will be forever linked to Obama. Dick Cheney, who is so often wrong, was not wrong in 2008 when he urged Republicans to get behind a bailout. He knew, and publicly stated, that if GM went under with Bush in the White House, the Republican Party would be seen as the party of Hoover.

Speaking of (mostly)Republican disparagements on GM, Jay Bookman suggests conservatives might want to issue a recall of their past public statements. He has an excellent compendium of quotes from critics who were convinced that govenment aid to GM was complete heresy. Here are just a few:

       

    “Every dollar spent with GM is a dollar spent against free enterprise.” -talk-show host Hugh Hewitt

    “Now the government has forced taxpayers to buy these failing companies without any plausible plan for profitability. Does anyone think the same government that plans to double the national debt in five years will turn GM around in the same time?”– U.S. Sen. Jim DeMint, R-S.C

    “I see no hope whatsoever for the situation. I think the $50 billion might as well be kissed goodbye. I would expect that this is just the beginning.”– conservative policy consultant Wendell Cox

You might think Republicans would have a bit more confidence. When Chrysler needed government support in the 1980s, far-left socialist Ronald Reagan was there. Chrysler recovered, paid back its loans, and was viable for a generation.

There is so much more on this, including the caveat that it remains to be seen how GM will ultimately turn out, but I got to get out of here for now. 

Gotta get a bird.

Some Good News, But Mostly Bad

I am not happy about Tuesday's election results, with a few major exceptions, but I am going to hold off on diving into the mess, especially since so many others will do so in the next few days. I'll let the dust settle a bit, and see where we can go from here. 

However, I do want to share with you some commentary from Robert Parry. I have a similar take: I am reminded of, and strangely comforted by, the studies that show that so many American voters do not know what they are talking about and voting on. There is a swath of ignorance in this country that is both astonishing and depressing.  And more on that later as well.  

As Robert Parry has put it:

"This Republican strategy that Reagan popularized in the early 1980s has – over the past three decades – returned the United States to a second Gilded Age of extreme wealth at the top, a shrinking middle class, growing desperation among the working classes, rampant stock speculation, and a bubble-and-bust economy.

Yet amazingly, millions of Americans went to the polls on Tuesday and voted for this approach. In Rust Belt states – such as Ohio and Pennsylvania – which have substantial interest in manufacturing jobs related to the auto industry, voters punished Democrats who saved General Motors and Chrysler, and favored Republicans who would have blocked the bailout.

Voters also sent the conflicting message that they wanted the federal government to focus on 'jobs, jobs, jobs' but also cut the deficit. They then empowered Republicans whose major idea for job creation is to slash taxes for the richest top two percent of Americans, an approach that has been ineffective in job creation but is expected to add about $700 billion in red ink over the next decade."

We political scientists have a technical term to describe this behavior: "fucking idiots."

On the other hand, I was extremely pleased that Colleen Hanabusa emerged victorious in her effort to take back Hawaii's first congressional district. In a race that the media frequently called "hotly contested," or somesuch, Colleen won 53% of the vote (to Djou's 47%). Still, only 55.7% of registered voters went to the trouble to vote.

Another plus was that Democrat Neil Abercrombie easily defeated Republican Duke Aiona in the race for Governor. And when you include the clear victories by Senator Dan Inouye and Representative Mazie Hirono, it was a Democratic sweep for Hawaii's congressional delegation.

Colleen's victory celebration was packed and festive. I am honored to have been able to contribute in some small way.

Why Don't Corporations Demand a Public Option?

I have often wondered why corporations have not supported a public option for health care or preferably a single payer plan. Our auto makers have longed complained about costly health care as a major reason for their relatively high overhead compared to foreign competitors.  And one of the reasons GM and Chysler were willing to build factories in Canada was government run health care.

One would think corporations would love to get out from under any costly program; after all, they have a long history of privatizing benefits and socializing costs. Why would health insurance be any different?

The Institute for Southern Studies (ISS) has offered some tentative possibilities.  One of these is that executives are reluctant to ruffle business relations for fear of encouraging expropriators. As David Himmelstein, one of the founders of Physicians for a National Health Program, says, "If you can take away someone else's business--the insurance companies' business--you can take away mine."

Moreover, says the ISS, corporations prefer some level of insecurity for their workers. The knowledge that coverage can be lost leads to a more compliant work force.

The problem with these hypotheses is that they don't explain why there is not a more heated public debate, not on the merits of health care reform, but on how non-insurance corporations would benefit from a government role and why they don't make the case. Certain executives may not want single payer for whatever reason, but why are they not at least compelled to defend their decision? Why have Democrats who support health care reform not made a better case to corporate America? Never mind the humanitarian or fairness arguments; most corporations don't give a shit about that. They do care about saving money. 

Some Credit is Due, Part II

On August 2nd I posted an article called “A Little Credit, Please.” I made the case that the Obama Administration's decision to support US automakers was proving to be a good idea, not only because the automakers were turning profits, but also because thousands of jobs were saved at the auto plants and at numerous suppliers as well.

Now Jared Bernstein, chief economic advisor to Vice President Biden, has further made the case that the administration did the right thing. In a recent article, Bernstein also emphasizes that thousands of jobs still exist at Chrysler and at its lengthy supply chain. He notes that there are three jobs in the supply chain, at companies producing a huge array of components, for every job at a Chrysler assembly plant. And these companies, and their workers, are in business because Chrysler, along with GM, are in business.

As Bernstein writes, “In the year before we took office, the auto industry shed 431,300 jobs. But in the 13 months since GM and Chrysler emerged from bankruptcy, auto industry employment has increased by 76,300, a huge reversal -- one we'd never have seen had we listened to those urging us to walk away. Of those 76,300 new jobs, close to 40,000 come from the suppliers. That's the fastest year over year growth that they've seen in a decade."

Good job, especially in a recession. One of the biggest obstacles to job creation in this country is the emasculated manufacturing sector. That sector was about to get a whole lot weaker since many, especially the President's Republican opponents, were ready to let the automakers fail --on Obama's watch, of course.

If GM and/or Chrysler, and much of their supply chain, had gone under, with their thousands of employees out of a job, on unemployment, the whole works, do you think Republicans would have made a campaign issue out of it?

They would have loved to, but it ain't gonna happen.

A Little Credit, Please

I see that Jed Lewison over at DailyKos has raised a point shared by quite a few of us. The mainstream media does not have much to say about American automakers' return to profitability and shows reluctance to give much credit to the crucial role played by the Obama administration. As Lewison posted on Friday:

“President Obama is in Motor City today to focus attention on what he feels is an untold success story: the improving fortunes of American automakers thanks to the administration's decision to use TARP funds to bailout General Motors and Chrysler. Since the administration took action, the auto industry has added 55,000 jobs -- the best growth since 1999.”

Detroit's rescue plan cost $60 billion, an amount that is dwarfed by any number of other spending priorities. That amount would not last long in Afghanistan. And it is a tiny fraction of the amount the feds threw at the big banks.

The critics are silent on the number of people employed by the automakers. This means not just the new jobs, but more importantly, the far greater number of jobs that were not lost because Detroit is still in business. Those workers are collecting paychecks, not unemployment. They are paying taxes on that income, a far higher share than most on Wall Street pay.

A relatively high portion of those paychecks goes to main street America. This is an economic reality that Washington's village people ignore. The guy or gal working assembly at one of the myriad Chevy or Chrysler plants receives a paycheck which is then usually deposited in a local bank or credit union, which then loans overwhelmingly to others in that same community. Much of the multiplier effect takes place within the community.

The auto industry also employs many other companies indirectly; e.g., the huge number of component suppliers. These manufacturers are filling orders and maintaining their own employment precisely because Detroit is still in business. Their workers also are paying taxes on their earned income, and they also have multiplier effects that benefit their own communities. It should be obvious that if the automakers went under, many of their component suppliers would have gone under as well.

Those who criticize the White House plan are missing the primary lesson. This is not, and should not be, the subject of an ideological purity test. It was more about doing what you can with what you've got. The benefits to the economy as a whole are direct and profound, for the government's role has returned both GM and Chrysler to profitability, and it has kept many thousands of employees working and not on unemployment.

$60 billion was a bargain.