Feb 132013
 

Last night’s state of the union address cast a more aspirational than confrontational tone.  Both sides will find plenty to spin, but overall the speech will be forgettable.  It’s probably a wise move not to do much browbeating just days ahead of another manufactured crisis deadline.  That would be too few days for some congresscriters to get over sore feelings about perceived insults in order to come to a reasonable conclusion of the sequestration issue at the end of the month.

State of the Union Address

On to reaction to the meat of the speech.

“Corporate profits have skyrocketed to all-time highs, but for more than a decade, wages and incomes have barely budged. It is our generation’s task, then, to reignite the true engine of America’s economic growth: a rising, thriving middle class.”  Boehner did not clap for the middle class.

” Democrats, Republicans, business leaders, and economists have already said that these cuts — known here in Washington as “the sequester” — are a really bad idea.”  The problem is that some lunatics in Congress think that the types of ideas in a reasonable compromise are worse ideas — especially ones that make their least favorite president look good.  Those lunatics need to be run out of town, but it is hard to do because their districts are rigged.

“Yes, the biggest driver of our long-term debt is the rising cost of health care for an aging population. And those of us who care deeply about programs like Medicare must embrace the need for modest reforms. Otherwise, our retirement programs will crowd out the investments we need for our children and jeopardize the promise of a secure retirement for future generations.”   This is the opening the “entitlement” haters will use to sneak in some cuts to seniors’ benefits/services.  “Modest reforms” is very vague, and some will argue that it includes Romney/Ryan’s coupons.

“Most Americans — Democrats, Republicans and independents — understand that we can’t just cut our way to prosperity. They know that broad-based economic growth requires a balanced approach to deficit reduction, with spending cuts and revenue, and with everybody doing their fair share.”  He really needs to make a much stronger case for the “fair share” argument.  He needs to directly compare the impacts on the lives of those effected by the changes:  How harshly will spending cuts impact the lives of the direct and indirect beneficiaries, versus how closing tax loopholes (or raising taxes directly) will impact the lifestyle of the extremely wealthy (hint:  they’re still going to be millionaires).  One side definitely feels more of a burden than the other from the choice.  President Obama failed to make this clear.

 
“We’ll bring down costs by changing the way our government pays for Medicare, because our medical bills shouldn’t be based on the number of tests ordered or days spent in the hospital. They should be based on the quality of care that our seniors receive.”  Interesting.  Maybe they can create a system where the provider gets paid more for better outcomes.  It would incentivize them to be efficient and effective.  Could it drive the profit motive more towards prevention and cures than perpetual treatment?  Still we’d probably be better off cutting out the middle man completely like almost all other industrialized nations in the world.

 

“And I am open to additional reforms from both parties, so long as they don’t violate the guarantee of a secure retirement. Our government shouldn’t make promises we cannot keep, but we must keep the promises we’ve already made.”   He forgets that he’s dealing with people who don’t believe there is or should be a “guarantee of a secure retirement.”  They believe that we should never have made the promise in the first place.  These people don’t understand how the economy benefits from having all of us together, via the government, help relieve the younger generations of some of the burden of providing care for the elderly, and how facilitating retirement of tired old workers has helped open opportunity for younger (often more talented and innovative) younger workers.  

 Killing Social Security and Medicare will save their wealthy friends a couple of bucks (that they won’t even notice when tossed upon their piled millions) but the greater impact will be felt when the burden is shifted to the other classes again as multigenerational households become virtually mandatory, and the elderly cling tightly to the fewer and fewer good jobs left in America … and for the elderly without a helpful family:  cat food (Well, cat food might be relatively more expensive now than in the depression era.  How about ramen noodles?)

 

“To hit the rest of our deficit reduction target, we should do what leaders in both parties have already suggested and save hundreds of billions of dollars by getting rid of tax loopholes and deductions for the well-off and the well-connected. After all, why would we choose to make deeper cuts to education and Medicare just to protect special interest tax breaks? How is that fair? Why is it that deficit reduction is a big emergency, justifying making cuts in Social Security benefits, but not closing some loopholes? How does that promote growth?” 

Right there he knocks it out of the park.  This might be the highest point of the speech for him.  Now go out there and repeat this over and over for the next two weeks  … or further if, as expected, they just punt the sequester deadline ahead a couple of months again (after all, it’s much better to hang around DC fussing at each other in the spring/early summer than bleak, grey wintertime.)

“Now is our best chance for bipartisan, comprehensive tax reform that encourages job creation and helps bring down the deficit.”  That’s where I shout, “YOU LIE!!“   Has this guy been paying attention to how Congress has been behaving the last several years? 

 

“Let’s agree — let’s agree, right here, right now, to keep the people’s government open and pay our bills on time and always uphold the full faith and credit of the United States of America. “   I don’t think they agreed.  You can’t even get Boehner to clap for the middle class.  Nice try though.

” But let’s be clear: Deficit reduction alone is not an economic plan”  Yeah, I agree they seem to have it backwards.  They think that reducing the deficit/debt will get us out of this economic quagmire.  Actually the opposite was true.  The thriving economy during the ’90s reduced the deficit and actually produced a surplus (which was quickly blown this century by two wars and tax breaks for the wealthy who were doing just fine thank you, and didn’t really need government’s help or bribery, but I digress) because more people were working (bringing in more revenue) and less people needed help (which lowered spending on crisis-related programs).  Don’t fall for the whining about uncertainty.  The only thing certain in life is uncertainty.  It’s a cheap cop out; don’t buy it.

 

He continues the speech with some policy shout-outs:  languishing Jobs Act, energy independence (saluting “drill, baby, drill;” yes, frack you, America.), climate change, infrastructure investment (start with that ever-crumbling bridge to the 21st century), pre-school for all, redesigning high schools by partnering with colleges and employers, Violence Against women Act and Paycheck Fairness Act, raising the minimum wage, Afghanistan troop drawdown (with hat tip to continuing effort to fight overhyped al Qaeda), cybersecurity, voting process reform, and gun control.

This analysis is getting too long, so I’ll end it with these two nuggets from the speech.

“So, tonight, I propose a “Fix-It-First” program.”  Right-wing conspiracy theorists will see this as despot Obama’s implementation of his secret Nazi sterilization/eugenics scheme.

” In fact, working folks shouldn’t have to wait year after year for the minimum wage to go up, while CEO pay has never been higher. So here’s an idea that Governor Romney and I actually agreed on last year: Let’s tie the minimum wage to the cost of living, so that it finally becomes a wage you can live on.”  At this point, Boehner looks like he’s passing a kidney stone.  An indexed minimum wage is a just idea, but unlikely to get through these guys, but I’m sure President Obama likes getting credit for mentioning it.

Digg This Share