Thursday, March 27th, 2014 by Daniel Horowitz and is filed under Blog, Economy
What happens when instead of fighting the premise of creating a permanent unemployment entitlement, many Republicans focus on offsetting the cost of the extension? We get the extension without any offsets!
Tomorrow, Senator Harry Reid plans to bring a bill to the floor that will extend unprecedented 73 weeks of UI benefits for five months retroactive to January 1. The bipartisan deal, which has the support of GOP Senators Dean Heller of Nevada, Lisa Murkowski of Alaska, Susan Collins of Maine, Rob Portman of Ohio and Mark Kirk of Illinois, will cost $10 billion just for the 5-month extension. We all know that they will continue to extend it when the deadline comes due in just five weeks.
The $10 billion cost would be “offset” by extending custom fees for another year in 2024 – 10 years from now. Additionally, the bill would “save money” by extending a “pension smoothing” provision for taxpayer-backed pension insurance for another few years.
Are you ready for the accounting gimmick of the month?
Most corporate pensions are insured by the taxpayer-funded Pension Benefit Guaranty Corporation (PBGC), which guarantees (up to a limit) the pension obligations promised to workers in the event that a company cannot meet them when they come due. As a condition for insuring the pensions, the PBGC requires companies to contribute specified minimum payments into the pension funds to ensure that they don’t fall behind on fulfilling their obligation and putting taxpayers at risk for bailing them out.
In plain English, “pension smoothing” allows companies to contribute less to pension funds in the short-term. Normally, their required minimum contribution depends on interest rates. When interest rates are lower, they are required to contribute more; otherwise the principle would compound too slowly for them to meet their overall obligation. With interest rates at historical lows, underfunding pensions would place taxpayers at risk to bail them out when they can’t compensate for the shortfall down the road. But like most Washington gimmicks, pension smoothing is designed to kick the can down the road.
So what does pension smoothing have to do with saving money for the federal budget and offsetting new expenditures?
Companies are able to claim tax deductions for every dollar they contribute to workers’ pension funds. By lowering the amount they are requirement to contribute, companies will deduct less from their corporate tax liability. Hence, this represents a notional tortured labyrinth to raise revenue down the road in order to pay for a definitive and immediate 5-month expenditure.
Perforce, not only is this a consummate Washington gimmick to obfuscate increased spending, it represents bad policy. When it becomes clear that pensions are underfunded 7-12 years from now, one of two things will happen. Most likely, companies will not have the money to fund the pensions, and taxpayers will have to bail them out. Alternatively, if they do come up with the money, companies will have to dump extra funds into the pensions, thereby securing a commensurate degree of excess tax deductions. Ultimately, the government will lose the same revenue they seek to gain in the short-term. Call it the rubber-band effect of pension smoothing.
This is what happens when Republicans give into the false premise of extending a bad policy.
It’s time for all Republicans to unite against any new extension. They should call out the Democrats for their ridiculous scheme of short-term extensions and challenge them to make it permanent law, which is what they are doing anyway. Instead, Republicans should support a true job plan that increases energy production, reduces corporate taxes, and expands energy production.
Tuesday, March 25th, 2014 by Daniel Horowitz and is filed under Blog
Many conservatives have expressed shock at the NRA political action committee for endorsing two liberal Republican incumbents – Rep. Mike Simpson (ID-2) and Senator Thad Cochran (MS-Senate). But to those who have followed the NRA over the years, this is just par for the course.
In 2010, I wrote a column at Red State exposing the fact that the NRA tried to keep Nancy Pelosi in power. At the time, Republicans needed to pick up 26 seats to flip the House, yet the NRA endorsed 53 Democrat incumbents, most of whom resided in the very seats Republicans needed to win back the chamber. Hence, if they had their way (and luckily, they were unsuccessful), Nancy Pelosi would still be speaker.
That’s some record of fighting for the Second Amendment.
This is not to say that the NRA as a broad organization doesn’t do any good work on a local level. It’s just that their federal government relations team and their political action committee are dedicated to growing their power before defending gun rights. If that means supporting bad legislation, obfuscating good legislation, or endorsing fake “pro-gun” Democrat and Republican incumbents, they won’t think twice before pulling the trigger. In fact, they will specifically gravitate to races where liberal Republicans are being challenged by conservatives who will be stronger on the Second Amendment.
In Cochran’s case, he voted for then-Senator Joe Biden’s massive gun control bill, which banned numerous firearms and created undue burdens and waiting periods on purchasers [Roll Call #125, July 11. 1991]. He also supported Barbara Boxer’s bill to prohibit the sale of all guns without Washington-approved safety devices [Roll Call #17, February 26, 2004].
Mike Simpson is the same sort of fair-weather friend to gun owners. In 1999, he supported mandatory trigger locks for new handgun purchases despite the protests of his constituents. He also voted for mandatory background checks imposed on Idaho gun shows. [RC #244, June 18, 1999]. Take a look at this article from The Hill on June 2, 1999 after Simpson’s constituents protested his vote:
When word got out last week that Rep. Mike Simpson (R-Idaho) supports the sale of trigger locks with handguns, fuming constituents deluged his four Idaho and Washington offices. “Well, they’re a little upset,” said Simpson, who spent much of his Memorial Day weekend explaining himself to constituents who grow fearful of anyone — particularly the federal government — coming near their guns. “They think it’s gun control,” he said. “They saw it as the camel’s nose under the tent. They expressed their concern that I’ve swallowed the line of the gun control advocates — that I’ve left the reservation, if you will… Simpson, who first voiced his views on the subject on a Boise radio show two weeks ago, said what he supports is not gun control, as people might think, but rather gun safety. His stance strays from the rest of the Idaho congressional delegation which vehemently opposes the mandatory sale of trigger locks with handguns. “I think it’s a commonsense move,” said Simpson. “I can separate the issue of gun control . . . from the issue of gun safety.”
Unfortunately, there have been very few votes on gun legislation in recent years, so these politicians have been able to use the element of time to heal the past wounds and create political amnesia.
Clearly, the NRA has its own agenda – one that is divorced from the community of gun owners in this country. Conservatives will have to look elsewhere for guidance on issues pertaining to the Second Amendment.
Tuesday, March 25th, 2014 by Madison Project Staff and is filed under Blog, Elections
Conservatives across the country are scrambling to take back the Republican party from the political class. However, there are so many inherent challenges in unseating entrenched establishment Republicans who enjoy superior resources and ubiquitous name ID. Yet, one of the most auspicious opportunities has gone undetected by many in the movement. There is a candidate who is committed to upending the political class and likely has the best chance to succeed of any challenger this cycle. His name is John Ratcliffe; he is running in northeast Texas (Fourth District ) and he deserves our support.
John Ratcliffe reminds us a lot of Congressman Jim Bridenstine (R-OK) in many ways. Bridesntine ran against an entrenched Republican on a platform challenging the establishment and pledging term limits. He did so without the support of most national conservative groups, yet he won decisively on election night. Ratcliffe has quietly run an effective campaign against Congressman Ralph Hall (R-TX), the oldest sitting member of Congress, and after less than three months he was able to draw the incumbent into a runoff. Now is the time for conservatives to act.
Congressman Hall is an honorable man and a veteran of World War II. But the contrast between the two candidates could not be any starker. Whereas Hall has turned his position into a career devoid of any desire to fight the status quo, Ratcliffe is picking the arduous path to a congressional seat precisely because he wants to send a message to career politicians.
John Ratcliffe served as a small-town mayor in Heath, Texas from 2004-2012. While every other municipality in Rockwall County raised taxes at least once during the recession years, Ratcliffe balanced the budget without ever raising taxes. During his tenure, the city of Heath’s financial rating was upgraded several times by all of the major credit rating groups to AA. As a popular figure who was urged to run again, Ratcliffe declined, even though there was no law limiting tenure in office.
Ratcliffe also has a wealth of experience in law enforcement and counter-terrorism; he served as Chief of Anti-Terrorism and National Security for Eastern District of Texas from 2004-2007 and was then appointed acting-U.S. Attorney for that same district. During his time as U.S. Attorney, Ratcliffe coordinated the arrest of 300 illegal immigrants in one day and prosecuted many of them for identity theft and Social Security fraud. John will fill the void within the party to fight against amnesty and for strong enforcement of our immigration laws.
John is a smart, articulate, and soft-spoken man who could have chosen an easy path to power. Congressman Hall has already pledged to retire after this next term. He could have gotten a head-start and worked within the system to take over from Hall in two years. Instead, he is challenging a long-serving and well-respected incumbent while pre-emptively pledging term limits. He understands that we cannot waste a solid conservative seat. Texas’ Fourth District should not be without a strong conservative voice in what is going to be the worst two years of the Obama administration.
Ratcliffe articulately sums up the problem with the status quo in the party by noting that too many incumbent Republicans are “conservative philosophically and operationally liberal,” seeking to be “tolerated by their conservative constituents instead of fighting for them.” Ratcliffe notes how hard it is to downsize bureaucracy from his experience trying to shrink a U.S. attorney’s office and a local government. That’s why he is leading by example with self-imposed term limits.
He is tired of the establishment Republicans taking conservative districts and acculturating them to dependency on the federal government. As such, he is committed to phasing out all federal subsidies of local enterprise – subsidies which inevitably come with strings attached. As a successful small-town mayor, Ratcliffe understands that local governments are hamstrung by federal control of functions that are inherently local in nature and will push to devolve those functions to the states.
Ratcliffe’s message is clearly resonating. After just three months of campaigning, he has held one of the longest serving members of Congress – who has never received less than 50% of the vote in any of the 18 counties in the district – to under 50% district-wide. John actually won two counties outright in the first round.
He is on the precipice of turning the tide for the May 27 runoff. If conservatives fail to join the fight we will waste this seat for another two years and run the risk of paving the road for an establishment candidate to replace him in 2016. Or we could rally behind John Ratcliffe and help change leadership immediately. The choice is clear.
Friday, March 21st, 2014 by Daniel Horowitz and is filed under Blog, Economy
Next week, Senate Democrats will restart their effort to create a de facto permanent unemployment entitlement for those out of work for up to 73 weeks. Unfortunately, instead of uprooting the entire premise of the Unemployment Insurance (UI) extension, many Senate Republicans are prepared to go along with this scheme as long as the 5 month cost is offset through some notional promises of more revenue in year 2024.
This represents a lost opportunity. The Democrat request for a UI extension in light of their Obamacare, Dodd-Frank, labor and environmental regulations on the economy is akin to someone injecting a painful disease into a patient while simultaneously demanding a constant flow of morphine. It’s time for Republicans to stand firm and pin the tail of long-term unemployment on the donkey. The message should be resoundingly clear: stop creating a permanent part-time economy with Obamacare and there won’t be a need to create dependency with fiscal morphine.
The Hill reports today on the findings of a Brookings Institute study detailing the state of the long-term unemployed:
A new study released Thursday finds that only about 11 percent of the long-term unemployed returned to full-time steady work a year later.
The study found that people out of work for at least six months are having an increasingly hard time reconnecting with the labor force.
It concludes that even if the unemployment rate returns to normal levels long-term unemployment will remain a problem in the economy and that “the long-term unemployed are an unlucky subset of the short-term unemployed.” […]
Between 2009 – 2013, the authors found that a sharp decline in job openings coupled with a decrease in labor force withdrawal rates accounts for the sharp rise in the number of long-term unemployed workers and the overall rise in the unemployment rate.
So what is the answer? What is the panacea? Do we subsidize even more individuals to stay unemployed or do we address the factors that have created the shortage of jobs?
That’s the choice Republicans need to communicate to the American people instead of getting mired in a dispute of which phony offsets to use in paying for the wrongheaded policy.
Republican leadership should block any UI bill unless Senator Harry Reid agrees to hold a debate on the real issues that cause unemployment. They should push full repeal of Obamacare, Dodd-Frank, and Obama’s new labor and environmental regulations. They should push Senator Ted Cruz’s new energy bill that will unshackle the private economy to create jobs. They should demand votes on lowering the corporate tax and repatriating foreign income – policies that Democrats claim to support.
Alternatively, they can agree to give amnesty to millions of illegal immigrants and double our record-high level of immigration and guest workers. After all, isn’t there a labor shortage in virtually every sector of the economy – both high-skilled and low-skilled?
Obamanomics provides Republicans with an opportunity to create a bold contrast. Will they actually bite?
Wednesday, March 19th, 2014 by Daniel Horowitz and is filed under Blog, Debt, Economy
Earlier this year, we were entreated to a vivid example of how neither party is committed to shrinking the federal government and bolstering private enterprise when they passed a five-year Farm/Food Stamp bill. CBO pegged the 10-year cost of the bill at $965 billion, up from $604 billion in 2008. Yet, the politicians sold it as an $8 billion cut because it fell short of the notional $973 billion baseline.
Aside for the raw cost of the bill, the structural changes on the agriculture side and the lack of reforms on the food stamp side actually made the bill even worse: At the time, we noted the following:
Moreover, any projected score on food stamp spending is meaningless. The food stamp program is part of mandatory spending, and given the fact that this bill fails to structurally reform the program on a large scale, the 10-year cost will continue to rise as more people are encouraged to join.
On the agriculture side, this bill is an even bigger joke. Drafters of the bill are boasting how they are abolishing $5 billion in direct subsidies. The problem is that this bill creates new subsidy programs, which will be even more expensive and market-distorting – and they will be permanent law, not subject to reauthorization.
The Agricultural Risk Coverage (ARC) would guarantee shallow loss off of record revenue farmers have been enjoying over the past few years. The shallow loss program would kick in when revenue dips below 86% of recent year amounts The Price Loss Coverage (PLC) would trigger subsidies when prices for certain commodities dip below target prices. For many crops, prices are already beginning to drop towards the cusp of those trigger levels. Hence, the cost of these programs will probably spike much higher than originally projected when CBO scored the bill with the higher prices.
Less than two months later, both predictions have come true. With regards to food stamp spending, the lack of structural reforms is precluding the actualization of even the notional baseline savings. Here is a report from NPR explaining why the “savings” from food stamp “reforms” never got off the ground:
The cuts were related to a program known as “heat and eat.” In the past, it had allowed the participating states to give low-income households as little as $1 a year in home heating aid so they’d qualify for more food stamps.
States said it made the program and got help to those who needed it. But the maneuver was called a loophole by both Republicans and Democrats. So last month, Congress agreed to raise the amount of utility assistance states would have to pay to trigger the provision — to more than $20 a year.
The idea was that many of the states that use “heat and eat” would decide it wasn’t worth their while. The expected result? Some 850,000 food stamp recipients would have their benefits cut an average $90 a month, which is where the savings would come in.
Turns out, Congress was wrong.
The “heat and eat” program covers 16 states, plus the District of Columbia. Six states — Pennsylvania, New York, Connecticut, Rhode Island, Oregon and Montana — have already declared that they will boost home energy benefits to avoid the food stamp cuts. Two other participants — Vermont and D.C. — are actively working to do the same thing.
With regards to the farm subsidies, Heritage Action has cited a new analysis from the University of Missouri’s Food and Agricultural Policy Research Institute confirming our worst suspicions – the new subsidy programs will cost more than the direct payments and more than CBO originally projected:
Despite the elimination of direct payments, the new farm bill is going to pay off better than the 2008 law for many growers and could be more costly to taxpayers than the Congressional Budget Office estimated, according to an analysis released Thursday that provides the first up-to-date look at the bill’s impact.
According to economists with the University of Missouri’s Food and Agricultural Policy Research Institute, the cost of the farm bill’s new Price Loss Coverage program will start at $2.1 billion for this year’s crops and increase to $3.4 billion by 2018.
CBO had estimated the PLC would cost roughly $1.6 billion to $1.7 billion a year through 2019. The CBO analysis was based off a forecast issued last year when market prices were higher. PLC will trigger payments when prices fall below fixed levels, or reference prices.
Every Republican running as a conservative this year must take notice. This is just one example of how the GOP establishment has no intention of fighting for limited government, and to the extent that they entice rank-and-file members into supporting shiny objects, there is always a catch.
Tuesday, March 18th, 2014 by Daniel Horowitz and is filed under Blog, Elections, Immigration, Issues, Obamacare
The defeat of former Senators Richard Lugar (R-IN) and Bob Bennett (R-UT) in their respective primaries in 2010 has engendered a new paradigm in GOP politics. No longer do liberal Republicans run honestly on their records in the primaries. That would create a recipe for instant defeat. Instead, they lie their way through the primaries, painting themselves as conservative heroes, and often tainting their conservative challengers as unreliable conservatives. Senator Orrin Hatch (R-UT) was the first to pioneer this strategy in 2012. Senator Mitch McConnell (R-KY) has followed this strategy to a tee. The two most recent examples are Reps. Mike Simpson (R-ID) and Renee Ellmers (R-NC).
Simpson is close to being unseated by Bryan Smith in Idaho’s Second District. In an act of desperation, he went up on broadcast television with an ad that touts his support for a balanced budget amendment, spending cuts, repealing TARP, and defunding Obamacare. Meanwhile, he tosses the meaningless, yet derogatory, label of “personal injury lawyer” at his opponent.
To anyone who knows Simpson’s record, this is possibly the most dishonest ad ever run during a campaign cycle. He obfuscates all of the consequential votes he’s taken that have actually been signed into law, such as massive spending increases, debt ceiling increases, and funding for Obamacare, and replaces them with vacuous show votes that he knew at-the-time would never pass. Most egregiously, he has the impertinence to say that he voted to repeal the Wall Street bailout while failing to mention that he voted for the original bailout that was signed into law!
Nobody who has followed Simpson’s career – supporter or opponent – believes he is a conservative. Even the American “Conservative” Union gave Simpson a failing grade of 46% last year. Yet, he has the superior firepower to completely lie to his constituents about his voting record while co-opting the conservative message – a message he has been repudiating for years.
Next up is Renee Ellmers running for reelection in North Carolina’s Second Congressional district. As we noted a few weeks ago, Ellmers is one of the most ardent supporters of leadership and a passionate supporter of amnesty and open borders. After a major dustup with Laura Ingraham over immigration, her liberal allies sense that she might be vulnerable to Frank Roche in the May 6 primary. Breitbart is reporting that FWD, which is funded by Mark Zuckerberg and run by McConnell acolytes, is up with ads promoting Ellmers as……tough on the border and against amnesty!
“Renee Ellmers is a conservative fighter for North Carolina,” a narrator reads in the television version of the ad, while pictures of Ellmers move across the screen. It continues:
“Ellmers voted for a Balanced Budget Amendment to cut the debt and stop the wasteful spending in Washington. She’s protecting Fort Bragg and Pope Airfield from massive defense cuts and working hard to secure the border and fix our broken immigration system once and for all. No amnesty, period.”
The ad then lists the D.C. phone number for Ellmers’ congressional office and advises viewers to “call Congresswoman Ellmers and tell her to keep fighting for conservative solutions.”
Folks, you can’t make this up!
One would think that with Ellmers proudly supporting “a pathway to citizenship for the undocumented” and with the polling for such a proposition supposedly skyrocketing to majority support, they would eagerly and honestly promote her real beliefs. Yet, they know that their views don’t sell at the ballot box, so they have to co-opt our views – even as they fight to the death against our solutions. That is why they are touting Ellmers as against amnesty and that is why Mike Simpson is running against TARP.
Undoubtedly, many establishment Republicans will win reelection. We cannot change the entire political class in one election cycle. However, not a single one will win reelection running on their true beliefs. They will overwhelm us with their liberal campaign cash, ironically, promoting positions that are antithetical to their actions in Washington.
This just goes to show that, despite their unlimited resources, the members of the political class are a bunch of cowards. They lack the courage to come out of the closet and propagate their big government views during the primaries.
Monday, March 17th, 2014 by Daniel Horowitz and is filed under Blog, Immigration
What happens when the opposition party is so committed to implementing amnesty – to the extent that they are willing to destroy their own base? The President will take the prerogative to implement amnesty on his own without fear of reprisal.
I never thought we’d live to see the day when the rule of law is suspended by administrative fiat to the point that Democrats openly tout their illegal plans:
Schumer, one of the leaders of the Senate’s Gang of Eight that pushed through a comprehensive immigration package last year, said it is clear where the issue of immigration reform is heading.
“They can either help pass comprehensive reform, which will greatly reduce the flow of illegal immigrants, grow our economy by bringing in needed workers in high-tech and agriculture areas, and provide a hard-earned path to eventual citizenship for the 11 million in the shadows,” he said in a Facebook post, “or they can sit idly by and watch the President greatly curtail deportations while 11 million continue to live in limbo here in America.”
Indeed, Obama has already ordered a review of deportations and has transferred DHS funding from a border fence to increased salaries for bureaucrats. This comes on the heels of the President’s pledge that Obamacare sign-ups will not be used to track down illegals for deportations.
What’s even more appalling than Democrats openly bragging about flaunting the law and vitiating our sovereignty is the complete callous disregard by Republicans.
What if citizens would stop paying taxes, or refuse to participate in Social Security? If the executive branch can countermand a law of Congress, why can’t the voters – those who grant Congress its authority – do the same?
The irony is that we are all compelled to obey laws that we don’t like, even those of dubious constitutional authority. Yet, the President is able to disobey one of the few core functions of the federal government while granting handouts to those who come and stay here illegally!
Senator Sessions has compiled a full list of actions this president has taken to violate laws passed by Congress and erase our borders while endangering our national security. Yet, instead of spending millions on ads educating the public about Obama’s malevolent and imperial actions, they are actually spending millions promoting Obama’s open borders agenda in an appallingly deceptive manner. Groups like FWD, run by McConnell allies, are running ads attacking House Republicans for not supporting amnesty.
Parting question: If Obama feels he can act unilaterally to alter America even before the midterm elections, what will stop him from pushing the envelope after November, when he officially becomes a lame duck?
Thursday, March 13th, 2014 by Daniel Horowitz and is filed under Blog, Elections, Press
Fort Worth, TX – The Madison Project PAC released the following statement in response to Congressman Mike Simpson’s (R-ID) appallingly dishonest TV ad:
“Simpson acts as if tossing around the vacuous stereotype of ‘personal injury lawyer’ against his opponent affords him the license to obfuscate his voting record and misleads the voters in Idaho,” said Daniel Horowitz of the Madison Project. “There aren’t enough shyster consultants in Washington who can produce honest ads to rehabilitate his liberal record. He dishonestly uses ceremonial votes that he knew would never be signed into law to obscure the consequential liberal votes he cast that were actually signed into law.”
Here are the facts:
Wall Street Bailout: Simpson has the unbridled temerity to suggest that he voted to repeal the Wall Street Bailout, while refusing to mention the fact that he voted for it in the first place [RC #681, Oct 3, 2008]. Although Simpson declines to cite the roll call vote to ‘repeal’ TARP, there was never a full repeal bill and it was never signed into law.
Balanced Budget: Simpson touts his vote for a Balanced Budget Amendment. That is lovely, but it is meaningless for him to support something that never had a chance to become law while supporting endless debt ceiling increases, which ensured that our budget would never balance. The examples of votes he’s taken to bust the budget are too numerous to list. A partial list can be viewed at SackSimpson.com.
Cut Spending: Simpson claims to have cut trillions in spending, but as a chief appropriator he has never met a spending bill he didn’t like. He even voted against the $100 billion in spending cuts promised by the GOP Pledge to America in 2011 [RC #103, Feb 18, 2011]. Mike Simpson was one of just three Republicans to vote against cutting off taxpayer funding for the radical liberal and corrupt ACORN [RC #397, June 2, 2011].
Obamacare: Simpson has the nerve to suggest that he voted to defund Obamacare, but he has always opposed the only consequential means of actually defunding the law, which is by objecting to any budget that contains funding. [RC# 550, Oct. 16, 2013]
The Madison Project endorsed Bryan Smith (R-ID) against Rep. Mike Simpson. To view our endorsement click here.
The Madison Project supports and raises money for conservative candidates that have demonstrated a commitment to full-spectrum conservatism. The Madison Project website can be found at http://madisonproject.com/
Thursday, March 13th, 2014 by Daniel Horowitz and is filed under Blog
Yesterday, the Senate Foreign Relations Committee passed a bill to authorize loan guarantees for Ukraine, similar to the bill that passed the House last week. The loan guarantee bill doesn’t directly increase spending; rather it adds Ukraine to the list of countries eligible for Economic Support Fund (ESF) grants. ESF grants have already been appropriated and are used as “walking around cash” for the State Department to send to allied countries in need of assistance (although the money often goes elsewhere). However, the bill does transfer extra funds into the Treasury in order to cover any potential default on the loan.
Let’s put aside judgment on the underlying bill for a moment; the more critical issue at hand is the International Monetary Fund (IMF) “reform” provision. Senate Democrats tacked on a provision that would weaken our sovereignty within the IMF, ostensibly increasing our quota and limiting our power. Here is how the Heritage Foundation describes the reform package:
“In 2010, the IMF board, with support from the Obama Administration, proposed a series of reforms that would increase the voting power of certain emerging-market nations and double the amount of member countries’ national “quota” contributions that are the primary source of funding for IMF loans.
The U.S. has the largest quota of any country in the world and also the largest single-nation voting share (16.75 percent). It has been the only country in the world with veto power at the IMF. Due to the constitutional role of Congress and U.S. veto power, this IMF reform package must therefore be approved by Congress before it can go into effect.
The reform package would change the rules for election of the IMF executive board, and the U.S. would lose the right it has heretofore enjoyed to appoint its own representative to the executive board—and that is where all the power is at the IMF.”
This “reform” package is similar to some of the treaties that are pushed through the United Nations by those in the world who want to attenuate our power. It would also cost us another $315 million.
GOP Senators Corker, McCain, Johnson, and Flake joined all the Democrats in supporting the bill. The other committee Republicans opposed it. Now everyone is wringing their hands over the impasse.
In comes Senator Mitch McConnell to cut a raw deal on a bill we don’t have to pass in the first place. The Hill has the details on the deal:
Republicans have long opposed the reforms, which they see as reducing U.S. influence in the IMF. They’ve sought to get a deal from the administration in which they’d agree to the reforms in exchange for the White House backing off on new regulations to govern 501(c)(4) tax-exempt groups that were at the center of the recent IRS targeting controversy.
The IRS rules, released after the tax agency acknowledged it improperly scrutinized conservative organizations, seek to clarify what would be considered political activity for tax-exempt groups.
The GOP offered a similar deal during a fight over an omnibus spending bill.
I’m hearing from a number of Senate sources that indeed it is Mitch McConnell who pitched this deal during the omnibus and is doing so now with the Ukraine bill. Politico also seems to confirm this through Senator Bob Corker. This is a quintessential McConnell backroom deal – to preemptively surrender on a definitive and immediate bad policy in exchange for mitigating a looming threat.
The IRS regulations have not yet been promulgated and they are illegitimate. We should not pay ransom on something Obama has no authority to do in the first place. We should fight the IRS regulations as part of a separate effort. If need be, we must use the power of the purse and fight them in appropriation bills for the IRS. Oh, I forgot, McConnell doesn’t believe in that.
Moreover, Obama has no leverage to pass the IMF bill. It cannot pass the House, and the Ukraine bill is not a must-pass bill. In fact, many conservatives would have rather we pass a bill eliminating the restrictions on exporting natural gas so that we can immediately lower the cost of energy in the world markets. The House should also attach a provision to pull out of New START. That would weaken Russia’s leverage and promote economic growth in one shot. That is the true conservative approach to peace through strength. But what can you expect from leadership?
Granting some loan guarantees to a weak country (that might use the money to pay off Russia anyway) is at best the most palatable option presented to House members by leadership and at worse, something to oppose. Even if you support the package, it is certainly not a hill to die on. We should not agree to weaken our power on a bill that was designed to project our power. If Obama insists on passing the IMF package, Senate Republicans should make it clear that we don’t care about passing a Ukraine bill while House Republicans should pass a bill dealing with energy exports.
However, from McConnell’s vantage point, this is a win-win scenario. He gets to evince power on the issue of campaign finance (which he likes solely because he is a campaign animal, not a believer in the Constitution), while empowering the world powers at the IMF. For McConnell, the IMF package in not a concession; it’s an ideal. In 1998, he sponsored and led the $18 billion IMF bailout package throughout the legislative process. Now he gets his IMF bailout and can claim credit for saving the Tea Party from the IRS – all in one backroom deal.
Who knows? This might even turn out to be “one of the Senate’s finest moments.”
Finally, does anyone think this behavior will change were McConnell to become Majority Leader? Obama will still be president in 2015 and will be as aggressive as ever. Now he knows how to pick McConnell’s lock. All he needs to do is threaten illegal action on one of McConnell’s white whale issues, and Mitch will oblige with a concession on legislation.
Does this man deserve a promotion?
Wednesday, March 12th, 2014 by Daniel Horowitz and is filed under Blog, Elections, Immigration, Obamacare
Republicans have held the Pinellas County-based 13th congressional district since 1971 when the late Rep. Bill Young was first elected to the House. However, with the death of Young creating an open seat, Democrats sensed an opportunity. Due to the changing demographics, President Obama carried this district by four points in 2012. Alex Sink had a good deal of name recognition left over from her 2010 bid for governor and was flush with campaign cash. Meanwhile, Republicans had to start from scratch with a competitive primary.
Despite being outspent 4 to 1 on a campaign level and being embroiled in intra-party friction with the national committees, Republican David Jolly held the seat last night. There is no lack of commentary and analysis attempting to read the electoral tea leaves and what this portends for November. But one factor that has clearly been overlooked is the issue of immigration.
There are obviously many variables that contribute to a victory or loss in a congressional election. In this case, Obamacare was probably the most prominent factor because it consumed the lion’s share of the dialogue on the campaign trail. However, we were told by the supercilious party elders that if we don’t embrace amnesty we will not win in competitive parts of the country. FL-13 has become the quintessential swing district, yet the Republican won, even though he drew a sharp contrast with the Democrat on the issue of immigration.
While Democrat Alex Sink candidly ran on the open borders agenda by disclosing that the motivation behind amnesty is so that we can all keep our housekeepers, Jolly categorically rejected amnesty. He ran an ad proclaiming that he is “in favor stronger borders. Not amnesty.” In a tight race, you don’t waste time or money on ads that don’t have a central issue at stake.
Again, Obamacare was clearly the biggest issue in the campaign. Furthermore, there is no telling how reliable Jolly will be after he is in Congress for a few months. But the notion that we must support amnesty to remain viable is clearly laid to waste by this victory in a Florida swing district.
Politico aptly notes that Jolly did not choose the squishy route in order to win a swing district:
Jolly, meanwhile, spent much of the race casting himself as a solid conservative, hammering home his opposition to Obamacare and tough-on-immigration views. Jolly allies believed that if they could limit Republican defections and take a chunk of independents, they could win.
Remember, Jolly contended with a moderate in the primary and attacked her from the right for being weak on Obamacare. She also supported amnesty and an array of liberal issues.
Consider this: if running as a conservative on the issues, including the issue of immigration, is a pathway to victory in an Obama +4 district, imagine the results in a district Romney carried by 10, 20, or 30 points.
But don’t expect the wizards of smart within the Republican Party establishment to ever consider that the reality of the immigration issue might be in conflict with their conventional wisdom. There is too much money invested in that fallacious premise.