Friday, March 31, 2017

Note To Readers

I've been blogging daily for more than a year now but it's time for a short break. The next week will have lighter blogging and more photos from a couple of trips around the country I've taken lately. But I imagine that the black hole that is the Trump administration and its GOP cohorts in Congress will not allow me to reach total escape velocity so I'm sure you will be hearing from me occasionally.

In the meantime, you can still follow stories and snark that appeals to me on twitter at m2c4@tidalsoundings or click the follow button on the right.


Three Separate Threads Of The Russia Investigation That Threaten Trump

Things move so fast with Trump administration disasters these days it is really hard to keep up. Sometimes, I'll be halfway through a post and it will be meaningless because of some huge new development that had just broken.

But I do want to try to take a quick overview of where we stand with the Trump-Russia connections and the ongoing cover-up, because there can be no doubt that's what it is at this point.

Right now there are really three threads to the story. The first is more historical and goes back to the early 2000s when Trump started to rely on money from Russia and the former Soviet Republics to rebuild his business after yet another bankruptcy. Maddow and others have shown clear evidence of oligarchs significantly overpaying for Trump properties and TPM has detailed other rather shady business deals Trump has been associated with. Whether there is enough evidence there to eventually implicate Trump in abetting money laundering is unknown as is whether there is a real will to investigate that far in the past.

The second thread is the collusion between the Trump campaign and Russia in influencing the election. And the number of contacts between the Trump campaign and Russian officials or state actors makes the case for this simply compelling. Roger Stone, Carter Page, Michael Flynn, Paul Manafort, and Jeff Sessions are meeting with or "talking" to Russian officials on a pretty regular basis when you combine them all together. Stone seems to think that he is legally OK with being in contact with Guccifer 2.0 and promoting WikiLeaks's upcoming material as long as he didn't ask them to do anything. And he may be correct. But I'm not sure that a lot of Americans would be happy with the idea that he was promoting the attempts of a foreign government to interefere in our election.

Based on his interview with Chris Hayes, I can't imagine who would trust Carter Page to do anything, but he managed to kind of hang on in the campaign far longer than he was seemingly worth. Why that might be and whether he was a conduit to the Russians in still anyone's guess. And, while we all may wonder about what Jeff Sessions talked about with the Russian ambassador in his Senate office, I doubt he was stupid enough to be colluding with them himself. He may have been dropping hints about certain quid-pro-quos but probably in diplomatic language that Kislyak understood but legally protected himself.

Michael Flynn had gone totally dark for a few weeks and he post-registered as a foreign agent, getting on the right side of the law, admittedly belatedly. Then the story came out that Flynn had essentially conspired to kidnap Gulen and spirit him out of the country to Turkey. It also looks like Flynn lied to the FBI. I took his disappearance and those stories as a sign that he had already made a deal with the FBI, but his lawyer's letter yesterday essentially begging anyone to give him immunity sank that theory. The problem for Flynn is that the only guy higher up that he can implicate is Trump and he either is unwilling to do that yet or he doesn't really have anything to bring Trump down. He may be willing to implicate Manafort in collusion but, at this point, Manafort is in so much trouble the neither the FBI nor the committees need Flynn yet. Of course, Trump is tweeting that Flynn should testify in return for immunity, possible sending a strong signal to Sessions in the Justice Department and again tainting the investigation.

Manafort has clearly been laundering money for Russian oligarchs for years. In addition, many of the techniques that the Russians used in this campaign were also used by Manafort when he worked for the Russians in Ukraine. While the selection of Manafort as campaign manager initially seemed unfathomable to Washington insiders, it seems pretty clear that Manafort and Trump matched up quite easily due to their familiarity with using oligarchs' money, either legally or illegally. If anyone was driving the collusion with the Russians, it was Manafort. Once that ball got rolling, the campaign kept it going after he "left". Right now, it looks like Manafort is the one in the most serious legal jeopardy and he may well be the key to the whole collusion story. Whether he will flip or not may take a while to find out.

Mark Warner took an interesting path with some of his questioning in the Senate hearing yesterday, implying that the Russians were able to target their active measures down to the precinct level. That kind of detail would almost definitely have to come from either a party organization or a campaign. The question that Warner leaves hanging out there is whether that data came from the DNC hacks or was somehow provided by the Trump campaign. If it was the Trump campaign, you would have to assume Manafort and perhaps even Trump authorized it.

Whether Trump knowingly colluded with the Russians or merely regurgitated talking points provided by Manafort from the Russians and their propaganda outlets will probably be hard to prove without explicit testimony from someone like Manafort. But as Clint Watts so aptly put it yesterday, Trump was clearly enabling Russia's active measures, knowingly or not. Says Watts, "[P]art of the reason active measures have worked in this U.S. election is because the Commander-in-Chief [Trump] has used Russian active measures at times, against his opponents." I'm sure there is a pretty lengthy list of Russian propaganda items that went straight back out through the mouth of Trump. That list may have already been compiled (send me the link if you know it), but it would look pretty damning when presented as evidence of Trump as an abettor of Russia's active measures. And, of course, there is always the unknown of Trump's taxes hanging out there. Who knows what they may show if he is ever forced to turn them over?

In addition, there may also be others that haven't been directly linked to the Russians, such as Bannon. Breitbart was continually recycling Russian active measures and false stories. How much Bannon was driving that coverage, if at all, is another open question. In addition, Bannon's position on the National Security Council brings into question whether he was the driver behind the whole Nunes debacle.

The final thread is the ongoing cover-up. The members of the Trump team, from Flynn to Manafort to Sessions, have continually lied about their contacts with the Russians. The White House has continually come close, if not crossed the line, into obstruction of justice. It enlisted the Republican heads of the House and Senate Intelligence Committees to debunk the collusion stories early on. And now, in order to prove Trump's tweet that Obama wiretapped him, the White House attempted to use normal intelligence intercepts as evidence supporting that claim, laundering them through the House Intelligence Committee in the person of Devin Nunes.

The staffers who "found" this information now face questions about why they were looking at raw intelligence and whether they handled that material correctly. And, as Barton Gellman surmises, their "research" may have been attempts to use NSA resources to "spy" on the ongoing FBI investigation. Regarding the staffers in question, one has close ties to Nunes and the other was specially protected by Bannon and Trump. Eventually, these staffers will be required to explain why and how they did what they did. Trump had predicted that information supporting his wiretap claim would be forthcoming and, lo and behold, a week later, Nunes announces his important new information. If this is proven to be just a scam by the White House, which all the evidence supports, it once again skates close, if not over, the line of obstruction of justice. And this time it is clear that Trump was aware what was going to happen. As the mantra always goes, it's the cover-up, not the crime.

Any one of these three prongs, so to speak, could wound the President mortally. The shocking thing is how much information has already come out about each of these three pieces. And we are only 70 days into the Trump administration. The Palmer Report is already reporting a source that says the President is considering resigning. With his approval numbers in the 30s and low 40s and a GOP in Congress that has no fear of him anymore, Trump must be wondering how long before the GOP wants to shove him aside, especially if his approval ratings with Republicans also begins to nosedive.

If it becomes clear that the any or all of these investigations are closing in on Trump or that the GOP is looking to throw him overboard, it will be a true test for Trump and his family. The Trump brand means everything to him and his family. Will the threat of impeachment so damage the brand it will be hard to move on? On the other hand, Trump hates to lose. Would he resign under pressure but continue to maintain his innocence and how would that effect the brand? Or will he fight to the bitter end? One thing we can say for sure is that it is going to be a  long year.

Education Dept. Prepares To Renege On 10 Year Old Promise To Student Borrowers

I think we've all gotten used to businesses reneging on their pension commitments to retired workers, promises that were made decades ago to keep wages down in exchange for a more comfortable retirement. And that propensity for defaulting on past promises has begun to bleed over to the states, with Puerto Rico's teachers' pension plan being an extreme example. But it is hard to believe that the federal government is now reneging on a promise made to college graduates a mere decade after those promises were made and after years of compliance by those seeking the federal benefit.

The story revolves around a federal program that promised to pay off student loans if the participants worked in a public service job for 10 years. The program called FedLoan would certify that the public service organizations these recent graduates were working in qualified for the federal benefit. The program encouraged, but did not require, participants to re-certify their organization every year. According to the NY Times report on this scandal, "The program generally covers people with federal student loans who work for 10 years at a government or nonprofit organization, a diverse group that includes public school employees, museum workers, doctors at public hospitals and firefighters." The program began in 2007 as part of a bipartisan bill focused on student loans and education financing.

Some years into the program, participants discovered that the public service work they were doing no longer qualified for the program. One example was a man who was working at the non-profit Vietnam Veterans of America. He did annually re-certify but in 2012 he was suddenly told that he no longer qualified, even though he was working for the same organization that had been previously certified. Worse, he was told that the decision was retroactive.

What became clear from examples like this is that the FedLoan program may have certified the organization involved but the final decision actually rested with the Education Department. According to the Education Department, a FedLoan letter "does not reflect a final agency action on the borrower’s qualifications. As the Times notes, "The idea that approvals can be reversed at any time, with no explanation, is chilling for borrowers." Needles to say, the American Bar Association is suing, claiming the Education Department is acting "arbitrarily and capriciously" in its determinations of who qualifies for the FedLoan program.

What's truly frightening is that there are hundreds of thousands of people enrolled in the FedLoan program and a large majority of them have never sought annual re-certification for the organizations they work in. October of this year is when the first of these participants will complete their 10 year commitment, thinking that the remainder of their student loans would be forgiven. Many of them may find out that the Education Department has ruled that they do not qualify and still owe thousands of dollars. Of course, many of those borrowers might have switched out of the nom-profit sector into higher paying jobs if they had known they were no longer eligible. Expect the lawsuits over this issue to balloon. This fall might present some interesting times for Betsy Devos.




Robots, The Industrial Midwest, Trump's Lies, And Democrats

Earlier this week, I wrote about the enormous impact that robots were already having, and will have, on jobs and that Trump's focus on trade was badly misguided. Trade's impact is largely over. The effect of robotics and artificial intelligence is yet to come. But that doesn't mean Democrats are absolved from presenting their own solutions to the coming onslaught of robots and AI, with a report showing that over one-third of jobs in the country may be replaced by technology in the next 15 years. If you want to see a populist wave, imagine were that to happen.

Democrats ignore this issue at their own peril. Take a look at this map the National Bureau of Economic Research put together that looks at where those 670,000 jobs were lost that were replaced by robots:

The problems that Hillary Clinton had in Pennsylvania, Michigan, and Wisconsin seem pretty easy to understand when you look at this map. And Donald Trump had a strategy to capitalize on these disenfranchised voters. Of course, that strategy was to lie to them and say he could bring those jobs back. He can't and those jobs are gone forever. But the voters believed him because that's basically the only hope they had left.

And Trump will continue to mislead these voters with his PR stunts that get a lot of attention but don't actually improve the real job market. From his announcement with Sony during the transition to this week's announcement with Ford, Trump claims he is creating jobs when the companies and Trump are essentially engaged in a mutual public relations exercise. These announcements are good for Trump and for the individual firms. The fact that most, if not all, of these job and investment announcements are essentially re-releases of previously planned actions during the Obama administration does not show up on most voters' radar. They only hear the big announcement from Trump, not realizing that is really just fiction.

But that does not mean the strategy for Trump is not working. Take a look at this graph about people's feeling about Trump's effort to improve business conditions:


Trump is truly off the charts when compared with any other President, even going back to St. Ronnie Reagan. The facts may be that these jobs were all previously announced and Trump has done nothing to create them, but it sure looks like the people in those industrial blue states are buying Trump's PR. Yes, the effect may wear off in a couple of years when people see that none of the jobs have really returned. Until then, however, Trump and Trumpism will have the other hand.

Of course, there is a reason that no one, Democrats, Republicans, or even Trump has come up with a real plan to deal with the crisis in those industrial states is because no one has a clue how to do it. And, as a country, we really haven't even focused on how to rebuild communities devastated originally by trade and now by technology. I see that here in my state of Connecticut where cities like Waterbury and Bridgeport, which lost their manufacturing base way back in the 1970s, have yet to fully recover.

Right now, the Democrats main economic plan for these distressed areas is a large investment in new and rebuilt infrastructure. But that is merely a short-term solution. Progressives need to start the conversation about a universal basic income, just like was done with increasing Social Security. But that is a longer term solution. If the number of displaced jobs that this report out lines is anywhere near correct, then government make-work jobs like beautification and support for the arts may be necessary. As Keynes noted, when unemployment is rampant, simply paying someone to dig a whole and fill it up again will boost the economy and those government efforts would be far more useful than that. A real industrial policy that targets specific areas and industries, like building solar panels, might also help. Another strategy, again certainly impossible under this administration, would be to encourage immigration and provide extra assistance for those new immigrants to get established in distressed areas. While this may cause an initial backlash, it is at least a start on future growth. Encouraging movement within the country to these areas would also help. This means more than just business tax credits. Those are useless if you can't get people to actually move into these cities and rebuild the tax base. There are a lot of other ideas already out there that will have to wait for another post.

Whatever the answer will be, it will take an enormous investment from the federal government. Cities can't do it because they've lost their tax base already. States can't do it for similar reasons and are budget-constrained. Only the Federal government has the resources and borrowing power to attack this issue. Eventually Trump's lies will wear thin in the distressed areas of the Midwest and elsewhere. Democrats better have a plan when that happens.

Thursday, March 30, 2017

WaPo's Congressional Reporter Does Not Understand Importance Of Merrick Garland

Paul Kane over at the Washington Post wrote one of the most disingenuous articles I have seen in a while with his analysis of what might happen with the Neil Gorsuch confirmation.

Kane highlights Democrat Senator Tom Carper and Republican Senator Roger Wicker who both believe that Democrats will filibuster the Gorsuch nomination and McConnell and the Republicans will then unilaterally change the rules and allow his confirmation by just a majority vote, invoking the "nuclear option". According to Kane, "The purpose of the [60 vote] rule is to promote bipartisanship and consensus, which in turn creates legitimacy and buy-in for policy and governance. If the filibuster goes away, so does yet another layer of collegiality in Congress — and another way to shore up Washington’s credibility...And once both sides are guilty of breaching that standard on nominations, it would seem to be only a matter of time before a future majority obliterates filibusters on other legislation." Kane believes that this would be a negative for the country, with some degree of justification.

Kane details how we got to this point, starting with Harry Reid's decision to change Senate rules with just a simple majority in 2013, rather than a vote of two-thirds of the body. Reid's rule change required just a majority vote for judicial nominees but left the filibuster in place for the Supreme Court. Kane seems to think this was a critical turning point and, again, you can't necessarily disagree with that.

But Kane never mentions that Reid was responding to Republicans' unprecedented obstruction of Obama's judicial nominations. I'll offer up just one example of that obstruction that is extreme but also typical. GOP Senator Thom Tillis put a hold on a seat on the Federal District Court for Eastern District of North Carolina for the entirety of Obama's term. In fact the seat remained unfilled for over a decade. In addition, the GOP refused to move forward on any of Obama's three nominees for the DC Court of Appeals which would have swung that court to liberals. And Republicans specifically did not block these nominees because of their qualifications. The DC Court is probably the most powerful and important court in the country, with the exception of the Supreme Court. Kane, however, neglects to mention any of this history, painting Reid's action as a purely partisan move.

Kane continues his analysis by claiming that Democrats' objections to Gorsuch, who he says "[i]n another time...might have been considered the consensus candidate", by saying "there is a sense of raw politics in Democrats’ growing opposition to Gorsuch, because liberal anti-Trump activists are pushing Democrats to oppose every Trump move...[S]ome Democrats think the bigger political penalty would be to disappoint their base by allowing an easy confirmation this time."

I think now might be a good time to mention that Kane has not yet mentioned Merrick Garland once in the article to this point. In fact, you have to get down to paragraph 17, after he has declared that Democrats are engaging in "raw politics" over Gorsuch that he brings up what happened to Merrick Garland. Worse, Kane refuses to categorize the treatment of Garland at all, unlike his comment on partisan nature of Democrats. Instead he quotes Tom Carper saying, "I have a very hard time getting over what was done to Merrick Garland, a very hard time..That’s a wrong that should be righted, we have a chance to do that, and it won’t be by confirming Judge Gorsuch the first time through." And he simply leaves the issue there.

Kane finishes his piece with these lines. "That [negotiating to let Gorsuch be confirmed in return for allowing a future filibuster] would set the filibuster in motion. And almost like Cold War generals mapping out war games, Republicans say they would be compelled to respond in kind. Otherwise Democrats would have set a new precedent for blocking a Supreme Court nominee." This is just a straight out fabrication. Filibustering Supreme Court nominees has always been an option and there is precedent for its use. Simply negotiating to allow a future filibuster is NOT setting a new precedent. What would be setting a new precedent is for Republicans to vote to use the "nuclear option" in order to get Gorsuch, a Supreme Court nominee, confirmed.

Paul Kane is the Washington Post's senior congressional correspondent. It is shocking and remarkable that he does not seem to understand the centrality of Merrick Garland to the opposition to Neil Gorsuch. For the first time in 40 years, Democrats had a chance to finally tilt the balance of the Court to liberals and that chance was stolen by Republicans. There is no other word for it. And despite the comments of people like Kane and Susan Collins, who says, "it is not fair to Judge Gorsuch to deny him a straight up-or-down vote based on what happened with Merrick Garland", Democrats can and will never forget.

With the advent of Citizens United, there are now hundreds of media sources that are virtual propaganda machines. Just look at the nexus of the Mercers and Breitbart or the whole Murdoch media empire. And with big data and sophisticated targeting, Russians and other propagandists can target certain users for more easily than in the past. At some point, the powerful mainstream media outlets like the Washington Post and the New York Times are going to have decide whether they want to defend our country and that means defending "truth". It also means not publishing deliberately misleading stories like the one Paul Kane just wrote.

Nunes Fiasco Obviously Coordinated By Trump

Despite the mainstream media's reluctance to reach any conclusions, let's just say what they and everyone else now knows. Trump obviously ordered and coordinated the whole Devin Nunes fiasco. The New York Times report that two White House officials, Michael Ellis and Ezra Cohen-Watnick, were the sources and enablers that Nunes used to get access to the information on incidental surveillance collection that in some way exonerated Trump's claim of Obama's wiretapping just confirms what everyone already suspected.

Cohen is a lawyer who works on national security in the White House and Watnick is senior director for intelligence for the National Security Council and has access to virtually all intelligence. Watnick was originally brought in by Michael Flynn and Flynn's replacement, H.R. McMaster, wanted to oust him when he took over because he was supposedly in over his head. But Watnick's job was saved by Bannon and Trump. Cohen worked for Nunes on the House Intelligence Committee up until just a few weeks to go. Apparently the information was so important that Nunes had to rush and brief the President on what his own National Security Council already knew.

Earlier this week, Sean Spicer insisted to the press that "it made no sense" for anyone in the White House to be the source of Nunes' information. That would normally be true unless, of course, the White House was trying to hide the fact it was the source. You might remember that, in his interview with Tucker Carlson, Trump claimed that the administration would be "submitting things before the committee very soon," an apparent reference to the House Intelligence Committee investigation headed by Nunes. Then, when Nunes made his subsequent announcement, Trump commented that he "felt somewhat vindicated" in his claim that Obama "wiretapped" him.

I know that we have no concrete evidence that Trump specifically coordinated this fiasco and I can understand the media's reluctance to say so. But it really is the only plausible explanation left. And the ridiculous reason for this whole charade is so that Trump would not have to apologize for his original and baseless tweet. And it has once again proved that Spicer and the administration are congenital liars who have no care or shame when they are caught out. On the other hand, this disaster has also had the additional benefit of postponing damaging testimony from Sally Yates, but that will only be temporary.


Report That Comey Wanted To Go Public in June On Russian Hacking Raises More Questions

Lost in the today's revelation about the White House being the source of the information that Devin Nunes felt was so important he had to rush back to the White House to brief the President on what the White House officials could have given Trump directly was a report that James Comey wanted to go public with an op-ed piece that would outline the Russian attempts to influence the election last summer.

Comey apparently had a draft of the piece that he discussed in a meeting with Attorney General Loretta Lynch, NSA Susan Rice, DHS Secretary Jeh Johnson, Secretary of State John Kerry, and others in June of July of last summer.  But those administration officials apparently felt that an op-ed from a single source would not be the powerful message they felt was needed and wanted time to bring other agencies on board before releasing any statement on the issue. That combined statement from multiple agencies subsequently came out on October 7th.

I've heard commentators today say that this report shows that Comey will be fair and always seeks transparency. That seems to be a pretty kind reading of the situation. If, as it appears, Comey did not write the op-ed based on instructions from the Obama administration, then why did he have the unprecedented press conference in July about Hillary Clinton's emails which was in violation of DOJ policies. I guess is it is possible that Loretta Lynch or the DOJ authorized that press conference but I doubt it. In addition, Comey definitely violated DOJ instructions and the wishes of his superiors with his letter about the Abedin emails that he had no idea were relevant or not. And, more importantly, Comey specifically refused to sign on to the October 7th statement. That hardly makes sense if he was really willing to write an op-ed about Russian hacking in June or July. And if he was so interested in transparency why did he continually refuse to comment on the FBI investigation of Russian hacking and possible collusion by the Trump campaign and transition.

This report looks suspiciously like a leak designed to make Comey look good, especially when the source denigrates the Obama administration for "doing nothing" when in fact they did release a strong statement in early October. In fact, this report just makes Comey look worse. If this report is true, rather than enhancing Comey's "reputation" for transparency, it actually raises even more questions and concerns about his actions with regard to both Clinton's emails and the Russian interference in our election.


Wednesday, March 29, 2017

Robots, Not Trade, Is The New Danger For Jobs

Yesterday, I wrote about the PwC report that showed that 38% of jobs in the US were in danger of being replaced by robots and artificial intelligence in the next 15 years. Today, in the NY Times, there are two articles showing that transition has already begun. Yet the Trump administration does not even see this issue is being on its radar. That does not bode well for our future.

The first story comes from Treasury Secretary Steven Mnuchin's own industry, the financial industry. Computerized, high-speed stack trading has been a feature on Wall Street for years and, according to some analyses, has created imbalances in the markets that favor the big Wall Street firms over the smaller investor. And now Blackrock, the largest fund companies in the world, has finally decided to hand over some of its actively manage mutual funds to the machines, replacing the human fund managers in the process. Part of this change is driven by the move toward index funds rather than a pool of specific stocks in managing portfolios. In layman's terms, that means buying an exchange traded fund that represents the full S&P 500 stocks instead of just picking 10 S&P 500 stocks for your portfolio. This move to using computerized fund management will end up costing the jobs of at least 36 people associated with the funds that are being automated. In addition, because computers are now managing these funds, as opposed to individuals, Blackrock will be able to cut the fees on these funds as well.

Next, an article in the Upshot section details a new study that outlines the job losses and wage effects that robots are having on the work force. A new paper by two economists out of MIT and Boston University actually contradicts a prior theoretical study that the two did on the effect of robots on the work force. In their theoretical study released last year, the two concluded that robots would actually create new and better jobs so that their impact on human employment would be largely muted. This study actually looked at real world data and came to a far different conclusion, document large negative effects on workers. In general, one robot for every on thousand workers reduced employment by 3 workers and lowered wages by 0.25%. But in certain specific areas of the country, that one additional robot displaces over 6 jobs and decrease wages by 0.7%. In manufacturing, which has been the industry with the earliest adoption of robots, the study estimates that robots have eliminated 670,000 between 1990 and 2007. With the onset of the financial crisis and the drive to cut costs, along with the advances in robotics, that number has probably grown substantially in the last 10 years.

There is no doubt that in the 1990s and early 2000s offshoring and the entrance of China into the WTO led to significant job losses here in the United States. But the effects of those changes, while devastating to certain areas of the country and sectors of our economy, has largely diminished. The more recent job losses have more and more to do with automation and robots and it will only get worse with the improvements in artificial intelligence.

Like the trade issue before this, robots and artificial intelligence may actually help grow the economy, but there will be clear winners and losers. The largest problem with our reaction to job losses caused by offshoring and world trade is that we did nothing to force the winners to help decrease the negative effects on the losers. That, of course, is an anathema to the Republican party because it implies "redistribution".

Steve Mnuchin, when asked about the employment effects of robots and AI, said, "[I]t's not even on our radar screen....50-100 more years...I'm not worried at all." And the Trump administration in general seems more intent on fighting a war on trade and offshoring that was lost about a decade ago and is over. Like generals over the ages, this administration is preparing to fight the last war. And by not being properly focused on the coming massive disruptions in employment and ideologically opposed to taking the steps to ameliorate that situation, our country seems ready to repeat the same mistakes we've made before.


Russian Connections Driven By Trump's Grifter Campaign

In retrospect, it seems pretty clear that the Trump campaign was simply a grift machine for everyone involved and that no one in the campaign actually had any belief that Trump would actually win the election. The whole campaign was just an opportunity to sell access and set everyone up to bank even more money on the chicken circuit, by selling more access, and in punditry after the election. And part of the reason they were all grifters is that Trump was not going to pay them anyway, as this was a marketing exercise for Trump and he did not need to pay campaign staff for that. And the Russians and others were only too willing to take advantage of that.

Michael Flynn was working as an agent for Turkey from August until election day, receiving $600,000 for his work. Part of that work included writing an op-ed piece that appeared on election day recommending the US extradite Fethullah Gulen, Turkish President Erdogan's arch enemy, back to Turkey. In addition, Flynn also "brainstormed" in a meeting with Turkish official, former CIA director James Woolsey, and others about the possibility of essentially kidnapping Gulen and "whisking" him back to Turkey.

Paul Manafort, who never saw some dirty oligarch's money that he wouldn't prostitute himself for or launder, had to be getting paid by someone, probably Russia or Russian interests, during the campaign, especially as he was the guy who drove the change in the GOP platform position on Ukraine.

Corey Lewandowski turned his failed position as campaign manager into a punditry gig at CNN.

Bannon and Conway were essentially paid by the Mercer family to take the job with Trump and they clearly knew where their bread was buttered.

Most of the others were either hangers on who hoped for a better job after the election or simply true believers.

Trump himself apparently merely intended to use the primaries as a platform promoting his brand, simply shooting to come in second. Winning the primary gave him an even bigger platform and enhanced his ability to get "investments" from Russia and China after the election. He was determined to spend as little as possible of his own money on the campaign and used his own businesses to pay for as much as he could.

This is why a thorough investigation of the Trump campaign will show that members of the campaign were getting paid by multiple sources, not just Russian connections. Because that was really the whole point of the campaign.

Astronomy Adventure - Craters And An Open Cluster

As Charles Pierce would say, it's always a good day for astrophotography. Here is a photo of what I believe is the crater Encke on the lower right with the peak rising in the middle of the crater and the crater Kepler in the middle right on the terminator. You can sense how steep Kepler's walls are as almost the entire crater is lost in shadow as compared to Encke.


And here is a bonus picture of the open cluster Messier 35 in the constellation Gemini. Tracking was a little bit off, but you can get a sense of just how magnificent this cluster is. Under dark skies, it is a naked eye object that was originally "discovered" around 1750. The cluster is reasonably close to us at just under 3,000 light years away.



Photo details:


Scope: Starblast 4.5
Moon Photo:
   Camera: iPhone 6 using NightCapPro with low ISO boost on
   Magnification: ~140x;
   Exposure: 1/50 sec?
M35 Photo:
   Camera: iPhone 6 using NightCapPro with high ISO boost on
   Magnification: ~25x;
   Exposure: 15 secs.

Tuesday, March 28, 2017

Some Silver Linings In The Clouds Of Climate Change

I don't write about climate change as much as I should and, to be honest, that's primarily because it is frankly just too depressing. From record low sea ice in both the Arctic and Antarctic, the loss of habitat that is driving beautiful creatures to extinction to the poisoning of our environment, heck the bumblebee was just put on the endangered list, to the criminal greed of the fossil fuel industry, it is often just too much to bear.

Many times, another new story about the greed-driven exploitation of our natural resources causes me to think of Jared Diamond's book, "Collapse", and the story of Easter Island. While other theories for the collapse of the society on Easter Island are also valid, Diamond's conclusion was that is was driven primarily by deforestation. There are no trees on the island today and I often wonder who were the ones who cut the last tree down and what could have possibly driven them to do so. And then you look at society today and realize that groupthink and the problems of people's everyday lives creates this space where it is viewed as either someone else's problem or, because we can't fix it ourselves, we simply have faith that it will all be taken care of sometime in the future.

With Trump rolling back the Clean Power Act today and the future of the Paris Agreement under threat and the continued prevalence of climate change denial within the totality of the Republican party, it is a pretty grim time. But there are some silver linings in the clouds surrounding us.

For the third year in a row, global carbon emissions remained flat. It remains to be seen whether this indicates we have finally reached a peak in carbon emissions or whether this is just a temporary plateau before it starts increasing again. But it is a very hopeful sign. Carbon emissions decreased in China and the US, while remaining flat in Europe. Those are the three top emitters in the world. Of course, in order to escape the worst of the global warming forecasts, which now seems likely to understate the damage to occur, carbon emission will have to begin to decrease. But you've got to start somewhere.

Today's executive order on repealing Obama's climate actions are not good news and will likely create more global warming. But, as is typical of Trump, the rhetoric in the order will not match the changes that actually occur. In fact, as Nancy Letourneau points out, his chances of rewriting Obama's rules on curbing carbon emissions are actually quite slim.

The real target of Trump's executive order is coal country and the order makes it seem like it will roll back the requirement that existing power plants limit greenhouse gas emissions. The existing rule spelled doom for coal-fired plants and made it prohibitive to build new ones. So Trump's order is intended to give those coal-fired plants new life. Except it's not going to happen. The first hurdle that Trump will have to clear is that the rules themselves are caught up in existing litigation. The EPA would have to get permission from the DC Court of Appeals to revisit the rules at all. Assuming that permission is granted, however, means the EPA would then have to justify why the original rules would need to be changed. The Obama rules were based on an Endangerment Finding that said that "that carbon dioxide and other greenhouse gases constitute a threat to human health and welfare." Changing or revoking that endangerment finding not only flies in the face of accepted science but would also trigger enormous lawsuits and years of litigation on its own. Without changing that finding, which Trump's executive order significantly does not instruct the EPA to do, any changes or new rules that the EPA would write would have to use the Endangerment Finding as its basis. If those rules actually ended up increasing carbon emissions, it would also set off a wave of lawsuits. And all these problems are compounded by the fact that new rules themselves normally take years to craft and become regulations and, since the administration does not seem inclined to fully staffing any agency, it becomes that much harder when the EPA is understaffed.

In addition, Trump's executive order today did not put in motion any process for the US to pull out of the Paris Climate Accords. That is important, but the danger is that any indication that the US will not be serious about meeting the 2025 goals for carbon emissions might quickly prompt others to start ignoring the agreement as well.

On March 3rd, California ISO, the largest electricity grid operator in the state reported that nearly half of its electricity generation at midday was coming from solar. In a few years, it is possible that solar and wind will actually be creating excess generation during daylight hours. By that time, hopefully, storage technology will have improved to the point where that excess can be used in the nighttime hours, limiting the costly ramp up of coal and gas-fired plants in the late afternoon and further reducing emissions and costs.

In Europe, countries continue to make big advances in renewable energy. In the Netherlands, all the electric trains in the country now run 100% on electricity provided by wind power. And in Norway, electric cars accounted for nearly 29% of all vehicles sold in the country last year and the government hopes to see that figure climb to 50% by the end of this year. Electric vehicles account for around 20% of all vehicles in the country now. Norway offers significant benefits for buying an electric car, including sales tax relief, free passage on toll roads and ferries, use of bus lanes, and waiving high-density traffic fees.

There is plenty of bad news about climate change, the thawing tundra, the changes in the jet stream, the shrinking sea ice, the Trump administration, but there are some bright spots here and there as well that we can not and should not ignore.


Trump Administration Oblivious To Massive Job Losses From Robots And AI

The other day I wrote that Treasury Secretary Steve Mnuchin seemed just a wee bit out of touch with reality, especially when it came to focusing, or rather ignoring, the impact that technology and artificial intelligence (AI) has today and will have in the near future on employment. In an interview was asked about the impact of AI and his response should frighten almost all workers around the country. Said Mnuchin, ""[I]t's not even on our radar screen....50-100 more years...I'm not worried at all."

PriceWaterhouse Coopers release a study last week recently that estimated 38% of jobs in the US are at risk of being replaced by the oncoming robot and AI revolution in the next decade and a half. 38%, think about that. And that's within the next 15 years, not the 50 or 100 as Mnuchin imagines. According to the report, "The likelihood of automation appears highest in sectors such as transport, manufacturing, and wholesale and retail, and lower in education, health and social work...Male workers could be at greater potential risk of job automation than women, but education is the key differentiating factor for individual workers."

The report makes clear that additional jobs will be created that offset some, if not all, of these job losses. But those new jobs will be more specialized and require specific skills. This will then further exacerbate income inequality, as lower skilled workers shed jobs and the new jobs created require higher skilled workers with theoretically higher pay.

All this screams to start putting together massive job retraining programs, something sorely lacking in the US. What job retraining programs we do have are often privatized rip-offs that get students into debt with the unfulfilled promise of a job that never materializes, kind of like Trump University. What we really need is real job retraining that targets specific industry needs. But I think we all know even that will not be enough. Which is why ideas like universal basic income or massive government employment programs are constantly being floated.

Of course, nothing will happen to address these oncoming problems under this administration. As Mnuchin makes clear, they don't even see the problem. In this area, as in climate change and others, the Trump administration looks more and more like Nero who simply fiddled as Rome burned.

Monday, March 27, 2017

This Time, Calls For Bipartisanship Should Be Met With Some "Tough Love"

In the aftermath of the failure of Trumpcare, Republicans are now calling on Democrats to work with them on a bipartisan solution to address the weaknesses that currently exist in Obamacare. Trump virtually begged the Democrats to come to the table in his speech immediately after Trumpcare. And Republicans Charlie Dent, Peter King, Senator Bob Corker, and Reince Priebus have all spoken out in favor of trying to reach some bipartisan solution in the last two days.

And some of the ideas being floated seem eminently reasonable. Kevin Drum offers up a hybrid solution of Trumpcare and Obamacare. His plan reduces ACA subsidies by one-third but then adds in the Trumpcare tax credits but at a flat $500 per person and not scaled by age. He adds a compromise on the age-based ratio of rates at 4:1, from the current 3:1 and the Trumpcare 5:1 ratio. Lastly, the GOP would drop the court case against the insurance cost-sharing funding, ensuring its continuation.

Steven Waldman offers up a compromise leveraging off a proposed by Christopher Ruddy, owner of Newsmax, of all people. Ruddy's solution relies on Medicaid becoming "the country’s blanket insurer for the uninsured." Ruddy prefers to use Medicaid rather then Medicare primarily because it has proven more effective than even Medicare in keeping costs down. Waldman uses this idea as his launching point, allowing anyone to buy into Medicaid with premiums tied to income. He then adds allowing all veterans and their immediate family to buy into VA health care. The last prong, to use the GOP terminology, of Waldman's plan is adopting the Democratic policy of allowing Medicare buy-in at age 55.

There are plenty of other solutions out there, even I've offered up some. And I'm sure many of them are great ideas that would greatly improve the ACA. But frankly every one of these, even my own, just sticks in my craw. Once again, Democrats are being asked to be the adult in the room and just "do the right thing". Republicans spent seven long years lying about the ACA, railing about its impending collapse, and making no effort to improve Obamacare. And now, having failed spectacularly to not only repeal the ACA but also destroy Medicaid at the same time, all in pursuit of massive tax cuts for the wealthy overlords, and without any input from Democrats, Republicans want to talk about a bipartisan solution. Obama and the Democrats spent months trying to build bipartisan consensus for the ACA. In the end, Republicans would not provide a single vote. And yet, even to this today, the GOP claims that Democrats simply rammed Obamacare through without any input from Republicans. That's just pure BS.

And it's not just Obamacare. Republican Senator Jeff Flake wrote an editorial in the Arizona Republic the other day in praise of Neil Gorsuch and imploring Democrats to vote for his confirmation. In that piece, Flake had the nerve to say this, "Even President Obama's two Supreme Court nominees were recognized for their ability to do the job and confirmed without incident. Unfortunately, it appears that Judge Gorsuch will not be afforded the same courtesy and respect. Senate Democrats' decision to filibuster Judge Gorsuch is a sad commentary on this institution and reflects the breakdown in comity that once characterized this body." Notice the elephant in the room that's missing from that analysis. That's right, Obama's third Supreme Court nominee, Merrick Garland, who never was given a vote or a hearing and whom some GOP Senators refused even to meet with.

I'm sorry, Democrats can not be expected to always be the adult in the room every single time that children in the Republican party act out. Bill Clinton raised the country from the recession left by G.H.W. Bush and the policies of the Reagan administration with virtually no Republican support. He left behind a budget surplus. Republicans stole the 2000 election, allowing G.W. Bush to take that hard-earned surplus and give it all and more to his wealthy cronies. Bush engaged in two massively expensive wars in both life and money and his policies created the greatest financial crisis since the 1930s. Again, with no Republican help, Obama helped us dig out of the financial morass and also provided the greatest extension of healthcare since LBJ in the 1960s. With James Comey's and the Russians' help, Republicans then stole the 2016 election and proceeded to try to undo the healthcare gains that Obama and LBJ created. And every step of that journey, when the GOP fails spectacularly or the Democrats get screwed, Democrats are called on to come up with the bipartisan solution, to be the adult, to let bygones be bygones.

Republicans had a mantra of "tough love" for decades and it is high time for them to experience exactly what that means. If they want a bipartisan solution on the ACA, then first they need to go out and repudiate almost everything they've said about it for the last seven years, to admit to their supporters that they lied to them about Obamacare. If they don't want Democrats to filibuster Neil Gorsuch, then admit that they are stealing this Supreme Court seat.

The GOP will never do this because they have gotten away with destroying the norms of our democracy and lying to the American public for decades. It has actually worked wonders for the party as they now control Congress and the White House. This time, however, they will finally have to answer for what they do. And when the GOP and the media comes running to the Democrats to be the adults again for the good of the country, as is happening now with Obamacare, Democrats should simply declare it is time for some "tough love".

Rant over.

Trump Quietly Getting US Deeper Into Foreign Entanglements

While we've all been focusing our full attention on fighting the repeal of the ACA and the resulting spectacular failure of Trumpcare, the Trump administration has quietly been expanding our military efforts in the Mideast.

Senator Chris Murphy detailed the increased US military presence in Syria and rightly worries that this will once again get us drawn into another quagmire from which it will be difficult to extricate ourselves. In a letter to the Huffington Post, Murphy states, "Without any official notification, Trump sent 500 new American troops into Syria, ostensibly to take part in the upcoming assault on the ISIS stronghold of Raqqa. News reports suggest this deployment may just be the tip of the iceberg, with some saying that the plan is for hundreds more American troops to be added to the fight in the coming weeks. No one actually knows how many troops are inside Syria now, because the administration has largely tried to keep the build-up a secret."

Raqqa is the last stronghold of ISIS and its defeat there would reduce its control of significant land area to almost nothing. Having American troops be part of that defeat of ISIS and occupy Raqqa, the self-declared capital of the ISIS "caliphate", would be a public relations win that Trump will certainly exploit, which may well be part of the rationale for the US buildup.

The escalation of US forces in Syria raises two important questions - what is the mission and exit strategy and do we have a political strategy in addition to a military one.  Murphy worries the Trump administration has neither.  "The public explanation of the military escalation has been to prepare for the assault on Raqqa. Taking Raqqa is a necessary and long-desired objective. The problem lies in making U.S. troops an indispensible part of the invasion force, which likely will require us to stay and become an indispensible part of the occupation force as well. This is what happened in Iraq and Afghanistan, and I see no reason why we wouldn’t face the same trap in Syria...Many Syria experts agree that once Raqqa is taken from ISIS, the fighting is just beginning. The contest then begins between the various proxy forces (Saudi, Iranian, Russian, Turkish, Kurdish) over who ultimately controls the city. Will U.S. forces leave at that point, or does Trump’s plan envision that we will stay to mediate future control of large portions of the battlespace?" 

Regarding the second issue of political strategy, Murphy is even more concerned. In a meeting with Secretary of State Rex Tillerson, Tillerson admitted that military strategy is far ahead of the political strategy when it comes to the aftermath  in Raqqa. And the military strategy borders almost on fantasy. Says Murphy, Tillerson's admission is "a dramatic understatement. Unless a secret plan exists that Trump is keeping from U.S. senators and his own secretary of state, there is absolutely no plan for who controls post-ISIS Raqqa, or post-Assad Syria...U.S. military leaders want to rely on Kurdish and Arab fighters to retake Raqqa, but hope that the Kurds will then abandon the city after they lose hundreds or thousands of their soldiers in the assault. Even if this fantasy were to become reality, it would come at a price -- the Kurds would expect something in return for their effort...To add complications, the Russian and Iranian-backed forces, sitting just outside Raqqa today, are not going to allow for a U.S.-backed Arab or Arab/Kurdish government to be peacefully installed inside the city. They will want a piece of the action, and we have no credible plan to accommodate them today." According to Murphy, this is a recipe for disaster and we appeared to have learned nothing from the debacles in Iraq and Afghanistan and seem prepared to repeat the same mistakes again.

In fact, the situation in Syria combines all of the impossible elements of Iraq and Afghanistan but now includes the presence of the Russians. There is a terrorist organization combined with an insurgency, combined with the normal Shia-Sunni conflict with their associated state proxies, the conflict with the Kurds and Turkey, and the presence of Russia who has always considered Syria its bulwark in the Mideast and which Putin is clearly intent on not losing. Diving into this situation without a clear understanding of the dangers, options, and path forward will simply end in disaster.

Then today, Secretary of Defense Mattis has asked the White House to lift the restrictions that the Obama administration had put in place on military assistance in the civil war in Yemen. Right now, US activities in Yemen are limited to counter-intelligence operations like the botched raid back in early February. Yemen is engaged in a brutal civil war that has once again devolved into a proxy war between Sunni and Shia powers. The Shiite Houthi rebels in Yemen are being backed by Iran while the government is backed by Sunni Saudi Arabia and the United Arab Emirates. The Saudis are actually fully engaged with Saudi forces continually bombing Houthi areas, with limited effectiveness and large civilian casualties. Apparently all that sophisticated weaponry the US has sold Saudi Arabia over the years has been largely wasted simply because the Saudis are incapable of using it effectively. The strategic US interests in Yemen are the terrorist threat posed by Al-Qaeda in the Arabian Peninsula (AQAP), which is admittedly serious, and the simple fact that the country is positioned to control access to the Red Sea and therefore the Suez Canal. But once again getting in the middle of a Sunni-Shia proxy war without a clear plan could end up in a quagmire.

Finally, in the wake of the botched Yemen raid and the killing of hundreds of civilians in a bombing raid in Mosul, it is clear that the Obama era policies on trying to restrict collateral damage have been loosened and the US military is becoming much more aggressive. Iraqi commanders have reported that the US has responded much more frequently to their calls for air strikes even when civilian populations may be endangered. According to the Times, "Another Iraqi special forces officer, who spoke on the condition of anonymity because of the sensitivity of the subject, said that there had been a noticeable relaxing of the coalition’s rules of engagement since President Trump took office."

Trump has surrounded himself with generals but has virtually no experienced diplomats in the administration at all. Tillerson has clearly been frozen out of the decision making process in the White House and has been totally ineffectual as Secretary of State. Nikki Haley at the UN has no experience other than governor of South Carolina. Even Dan Coats, the current DNI, only served on the Senate Intelligence and Armed Services committees, not on the Foreign Relations committee. The overwhelming advice the President is getting from within his administration comes with a military slant. And with Trump having alienated many of our allies, the US may be acting on its own far more than in the past. That does not mean the Mattis and McMaster are unaware of the dangers of moving forward militarily without a political strategy. The question is whether those concerns ever get through to Trump and get acted on. So far, it seem that the answer is no.

Trump And The Decline Of American Education

Donald Trump has already done plenty to contribute to the "dumbing down" of America with his constant lies and obfuscations. But he is doing more lasting damage as well, from grade schools to graduate schools.

In Las Cruces, New Mexico, an ICE raid prompted a startling 60% rise in absentee rates at local schools, with over 2,000 students not showing for classes in the area. The ICE raid occurred on February 15th and the increase in absences began the very next day. Some elementary schools in the area showed absentee increases of 150%. After a letter from the schools district's superintendent to all families saying that further ICE raids were not expected, absentee rates returned to somewhat normal levels around a week later.

In 2011, the Obama administration instructed ICE to avoid schools, churches, and hospitals for enforcement purposes. But, under Trump, it is unclear whether that policy remains in place as ICE has violated the policy in a number of instances. Certainly, undocumented immigrants have no faith that ICE will follow the rule so every raid creates large repercussions in the community.

It seems pretty obvious that driving these children, who are not necessarily undocumented themselves but may have a parent who is, away from school will not help their education. It certainly creates a perpetual sense of fear in both parents and children that is not healthy.

In Toronto, schools have decided to cease field trips to the United States for fear that some students will be turned away at the border under the Trump administration's extreme vetting program. A similar issue of foreign students not coming to the US is now creating real problems for American colleges and universities. Foreign students create some $32 billion in revenue for these institutions and support some 400,000 jobs in the education industry.  But a recent survey showed that 40% of colleges and universities have seen drops in applications from foreign students.  As a counterpoint, universities in Toronto have seen an 80% rise in applications from the US and a 25% rise in foreign students overall.

Foreign students for the most part represent the best and the brightest from around the world. When they come here for an education, many end up staying and becoming productive members of our society and economy. So we are losing more than just revenue and jobs for colleges and universities. More than half of the billion dollar startups in this country were created by immigrants to the US. And the foreign students who return to their home country carry some of America's values back with them.

Trump's extreme immigration policies are already adversely effecting American education and the future prosperity of the country. And the scary thing is, the impact of Betsy DeVos on education has yet to be felt.

Sunday, March 26, 2017

Conundrum For Schumer, Democrats In April's Budget Battle

Donald Trump and the Republicans may want to move on to "tax reform", which will end up being the usual GOP unfunded tax cuts, but they will have one important hurdle to get over before they even get around to that. In late April, the continuing budget resolution that was put in place last fall will expire and that will provide Democrats with an opportunity to extort some concessions out of Republicans in order to avoid a government shutdown, as the GOP has done to Democrats over the last few years.

The continuing resolution is just another example of the failures of the Republican-controlled government to even provide the basics of governing. One of the primary responsibilities of Congress, if not THE primary responsibility, is to simply pass a budget to fund the government. Republicans have simply been unable to do that, simply relying on continuing resolutions that continue to fund the government at existing levels.

But continuing resolutions rely on 60 votes to pass in the Senate. In December of last year, when the GOP offered a continuing resolution to fund the government at 2016 levels until April of this year, Democrats flirted with the idea of not providing the votes to get to 60. Joe Manchin, in particular, along with Sherrod Brown, wanted to get a yearlong extension to the miners' insurance program instead of just through April as the continuing resolution provided. There were not even enough votes among Democrats to make that threat feasible but it did allow those two coal state Democratic Senators to highlight their support of miners. In the end, Democrats provided the votes to pass the continuing resolution and not shut down the government.

But that was in December when Democrats were still in shock over losing the election to Donald Trump and having to confront the fact that the GOP now controlled Congress and the White House. It was also a time when Senate Minority Leader Schumer was probing for ways to possibly work with Trump that Democrats could support, such as an infrastructure program. Things look a bit different these days. Democrats are coming off a huge victory with the defeat of Trumpcare, Trump has an abysmally low approval rating bouncing between the high 30s and low 40s, and the Republicans in Congress are in seeming disarray. In addition, Trump is further weakened by the expanding investigation into whether his campaign colluded with the Russians to damage Hillary Clinton. And the Democratic base is energized, not demoralized.

The recent history of government shutdowns has shown it to be an action that is always opposed by a strong majority of the American public. The Republican controlled Congress shut down the government in 1995 and 1996 while Democrat Bill Clinton was President. The GOP eventually caved in both instances and got blamed for the shutdown. The shutdown actually increased the strength of Clinton's support, leading to the ouster of the architect of that strategy, Newt Gingrich, as Speaker of the House. The strategy was employed again in 2013 when the Republican controlled House continued to send budgets to the Senate, controlled by the Democrats, that stripped out funding for the Affordable Care Act (ACA). Each time the Senate stripped out the language regarding the ACA and sent it back to the House. Once again, the prolonged shutdown got blamed on Republicans and they were eventually forced to back down, although it did not seem to hurt them in the 2014 elections less than a year later.

Like last December, Democrats will seek to receive some concessions from Republicans in order to keep the government funded through another continuing resolution. There is no way the GOP is going to have a budget in place in the next month so that will be the only mechanism for keeping the government running. The question is will the Democrats really be willing to shut the government down if they do not receive those concessions or will they cave like they did in December.

If Democrats do go ahead with that threat, it would be the first time, at least in the recent hyper-partisan era, that the government has shut down with one party controlling both Congress and the White House. That presents an interesting question on who would bear the brunt of the blame should that happen. The President has the bully pulpit and can make life difficult for Democrats but it is also possible that the public, ignorant of the arcane rules in the Senate, will just see this as another example of the Republicans not being able to govern even when they control Congress and the White House. The judgement of how the shutdown plays out with public opinion may be just as crucial, and potentially deadly, for Schumer as it was for Gingrich.

The other issue is what concessions should the Democrats realistically be demanding to get by agreeing to the continuing resolution. Should they throw the ball back in Trump's court on Obamacare by demanding tweaks to shore up the exchanges and cut premiums and deductibles, since he claims the ACA is imploding, or does that open up the danger of the GOP taking another crack at total repeal? Should they try to derail the moves on tax reform, meaning unfunded tax cuts, by getting Trump to agree on an infrastructure plan? Should they try to swap guarantees on some new discretionary spending in return for an increase in the military budget? Should they just play small ball and try to ask for specific measures to help red state Democratic Senators, like they did in December? Or should they just go along with the continuing resolution and hope the GOP continues to self-destruct on tax reform and the budget? Whatever position Democrats take, it comes with the risk that public opinion will turn against them and they will be forced to back down. Taking hardline issues on health care and infrastructure and then having to cave will make it harder to deal with both those issues if and when they do come up again and caving, after holding out for those core issues, will demoralize the base. It is an enormous conundrum for Democrats and Schumer and the decision could have a lasting impact that would effect the 2018 election.

I know I wouldn't want to be in Schumer's shoes having to make this decision. What do you think?

Update: Reader pasuburbdem1 over at DKos has come up with the best idea yet! In return for agreeing to the continuing resolution, Democrats should demand that Trump release his tax returns for the last ten years. Imagine Trump letting the government shut down because he refuses to do what every other presidential candidate, much less President, has done for the last 30 years. I think it's a brilliant idea!

Trump Tax Reform Really Means Tax Cuts But Needed ACA Repeal First

Well, that didn't take long. After praising the effort of Paul Ryan and blaming Democrats for the failure of Trumpcare on Friday, Trump recommended that everyone listen to Jeanine Pirro's show on Fox last night. Pirro then went on to put the entire blame for the Trumpcare failure on Ryan, calling on him to resign.

Pirro blistered Ryan, saying,  "Paul Ryan needs to step down. The reason? He failed to deliver the votes on his health care bill ... The one that he had seven years to work on ... The one that had to be pulled to prevent the embarrassment of not having enough votes to pass." Pirro also went on to vigorously defend Trump for this enormous failure. Said Pirro, "I want to be clear. This is not on President Trump. No one expected a business man to completely understand the nuances, the complicated ins and outs of Washington and its legislative process." Actually, we do expect our President to understand the ins and outs of the legislative process. After all, that's his freaking job. And, if he doesn't understand how complicated it can be, maybe he should spend more than three weeks trying to get it done. But we all know Trump is incapable of that type of focus and intellectual curiosity.

One of the themes of those disappointed Republicans is that Ryan made a huge error by convincing Trump to lead off the legislative agenda with healthcare reform. That blithely ignores the fact that Republicans have been campaigning on repealing Obamacare for the last seven years and Trump continually said that it would be the first thing he would do when he got in office. The cries of betrayal would have been loud and long from the GOP base. More importantly, Trump is President and he has the ability to control the agenda, especially when Republicans control Congress.

But that criticism of Ryan also ignores the fact that the real goal of the Republican agenda is tax cuts, as it has always been. And the repeal of Obamacare was how the GOP was going to get a majority of those tax cuts. Trumpcare would have lowered baseline spending by over $1 trillion over ten years and about $600-$700 million of that went to tax cuts, all of which went to the top 2%. For the GOP, that would have been a great start.

But now that Trumpcare has failed, because of some of those arcane rules that Trump does not understand, especially in the Senate, it will be more difficult to get huge tax cuts out of real tax reform that Trump has promised. That's because tax changes are required not to increase the deficit over a ten year window in order to avoid a filibuster in the Senate. Ryan's plan, which leveraged off of Trump's campaign promises, hoped to bank that lower baseline spending number and tax cuts by repealing Obamacare. In fact, the lower baseline spending number was an important impetus for doing Obamacare repeal first, along with its obvious political benefits, or so the thinking went. Then Ryan would make good on Trump's pledge to impose tariffs on Mexico and other countries with a complicated border adjustment tax. The tax would actually be paid by American businesses and citizens but it was designed be sold as a tax on cheap imports and a benefit to exports. That tax would actually create an additional $1 trillion in revenue which could then be used to reduce the corporate tax rate and add further individual tax cuts while still remaining revenue neutral and avoiding a Democratic filibuster. In addition, the GOP could get further tax reductions by having the CBO provide "dynamic scoring" of revenue "created" by the tax bill. "Dynamic scoring" is essentially the myth that lower tax rates will induce greater economic activity and actually increase tax revenue. It has never been shown to work in practice, as Kansans can ably attest, and was rightly called out by George H. W. Bush as "voodoo economics". But its has been a GOP mantra for the last 30 years, despite no evidence supporting it.

These were the three legs that supported the GOP tax cut plans and everyone in the GOP knew it. And the beauty of this plan from the Republicans' perspective is that it would require the Democrats to control Congress and the Presidency in order to roll back these tax cuts in the future. The first problem that it encountered was that certain powerful business interests hated the border adjustment tax. There were clear winners and losers with that tax and the losers were not only not happy but also powerful, such as retailers like WalMart. In mid-February, Trump seemed to back off the border adjustment tax and many GOP Senators expressed their opposition as well. That was the first leg of the tax cut plan to fall. Now, with the failure of Trumpcare, a second leg has fallen as well. Without the spending cuts from Obamacare repeal and its associated tax cuts and the extra revenue from the border adjustment tax, there is not a lot of room for additional tax cuts through a supposedly neutral tax reform. The only leg left is the controversial dynamic scoring option which will not produce too much either.

That leaves just two options to pushing tax cuts through Congress. First would be to pass a budget that dramatically cuts spending, freeing up money for tax cuts. But the budget is likely to be even more contentious than health care, even within the GOP caucus. It would once again pit the moderates in the party against the more radical fringe like the Freedom Caucus. Republicans controlled Congress last year and were unable to produce a budget on their own even then. Budget issues are further complicated by Trump's desire to increase military spending, while at the same time being required to adhere to budget sequestration rules included in the Budget Control Act. Sequestration puts caps on defense and non-defense spending and the law prohibits breaking through the defense cap and then trying to offset that with cuts in non-defense spending, and vice versa. To break sequestration, the Senate would need the 60 votes to break a filibuster which is not going to happen in the current environment. So there is no real way to get the spending cuts needed for tax cuts through the budget process, especially if you want to increase military spending.

The only option remaining for Republicans to get tax cuts enacted is to repeat what they did in the Bush administration. The GOP pushed through massive tax cuts but made sure they sunset in the 10th year and thereby avoided the filibuster and could pass with just 51 votes. That path is still open to them now but it may be more difficult getting it through the fiscal conservatives in the party, as it will clearly increase the deficit in the short term. In addition, rather than requiring the Democrats to control Congress and the Presidency, these cuts will end after 10 years without the Democrats even having to take a vote, just like the Bush tax cuts did. Trump and the Republicans may describe this effort as tax reform, which has always implied revenue neutrality beyond a 10 year window, but it will clearly not be tax reform. It will be another tax cut. And there are indications that this is the Republican strategy. Yesterday, Vice President Mike Pence, in what sounded like his first campaign speech for the potential 2020 nomination, stated that Trump and the GOP will enact the biggest tax cut since Ronald Reagan. And today, Mark Meadows, the embattled head of the Freedom Caucus, who the Wall Street Journal and others on the right have clearly blamed for the Trumpcare failure, has said today that tax reform does not necessarily have to be revenue neutral. That essentially admits that it will not be tax reform but tax cuts inside the ten year window. That it certainly an interesting position for the fiscal conservatives in the Freedom Caucus, who are constantly demanding a balanced budget, to take.

One thing that Republicans can always agree on is tax cuts. And I'm pretty sure that they will get them one way or another, most likely by sunsetting them in ten years. But they also agreed that Obamacare had to be repealed and that proved too difficult for them. Tax cuts under the guise of tax reform may also prove pretty difficult as well. That is especially true now that the Republican party is almost in open war. The tax-cutting right like the Wall Street Journal is blaming the Freedom Caucus while Trump is blaming Ryan and avoiding any blame himself. It will not make for a happy and unified party as they tackle the rest of their agenda.


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