Wisconsin Just Showed Us. You can call a do over on your reactionary votes from 2010. Hate your representative? Completely upset with the jobs crisis, now projected to continue ad infinitum?
Have a recall!
In the largest clustered recall ever, six Wisconsin State Senate Republicans faced a recall election and special interest money poured into the State:
Spending on the nine elections had reached $33 million, most of it from outside special interest groups. Interest group spending has far eclipsed the Wisconsin record of about $20 million set in 2008 elections that covered half the state Senate and all Assembly members.
The fight is over Governor Walker's war against organized labor in Wisconsin, along with his Tea party cohorts. His anti-labor legislation prompted a massive recall effort of State Senators who helped Walker push through his anti-labor agenda. The voter turnout is hitting Presidential election levels.
Democrats needed to win 3 of the 6 races to regain control of the Wisconsin State Senate. They Came Up One Short. There is round two of this battle, with two Democratic State Senators suffering through a recall election on August 16th.
Here are the 6 Republican State Senators who were up for recall, with the Democratic opposition and the election results:
- SD-02: Robert Cowles (R) vs. Nancy Nusbaum (D) - Winner: Republican
- SD-08: Alberta Darling (R) vs. Sandy Pasch (D) - Winner: Republican
- SD-10: Sheila Harsdorf (R) vs. Shelly Moore (D) - Winner: Republican
- SD-14: Luther Olsen (R) vs. Fred Clark (D)- Winner: Republican
- SD-18: Randy Hopper (R) vs. Jessica King (D) - Winner: Democrat
- SD-32: Dan Kapanke (R) vs. Jennifer Shilling (D) - Winner: Democrat
Totaling over $33 million, money from labor unions, the Koch Brothers and corporate interests poured into the State. Koch fired off $1.5 million in one shot, with $400,000 going to one Republican on the recall list. Koch made a one time $150k ad buy additionally.
According to the Washington Post the $33 million was evenly distributed between Democrats and Republicans. Salon has additional breakdowns of the money.
A coalition of labor unions acting under the title "We are Wisconsin" has reportedly spent $8.8 million on Democratic recall efforts and, as such, is the biggest spender on the left. The Greater Wisconsin Committee, a liberal advocacy organization, has donated $1.5 million. Neil Sroka, press secretary of the Progressive Change Campaign Committee, told ABC News that his group "have joined up with another liberal activist group, Democracy for America, to spend $2 million in the state -- $1.5 million on television ads and $500,000 on grassroots work."
Literally the recall was Wisconsin's own mini economic stimulus for the duration of the fight.
Mother Jones reports there is additional undisclosed funds which went to the GOP side. There are also tales of election tampering pouring in.
This is for a State Senate seat mind you, where a national Senate campaign is about $6 million. Why this is so important is it's an early indicator of what will happen for Election 2012. These results also have strong implications for Wisconsin Tea Party Congressman Ryan. Ryan proposed cutting Medicare benefits through a voucher system and under the guise of budget cuts. Ryan, as are all Congress representatives, are up for re-election in 2012. The public reaction to Ryan's agenda was outright condemnation.
Another reason this recall is so important is it's big corporate money versus grassroots and organized labor. Can you really buy an election always, every time?
The answer seems so, if one reads the polls which show most side with organized labor. Yet when it comes to actual elections, once again, labor loses.
Comments
money in the kettle
Awww what a shame. The left is name calling the right for having millions of outsider money shipped in while it tried to downplay their own donors. And of course, all their donors were clean and reverent on the books. That's okay though, everyone is entitled to their political opinions. That's like the Waukesha county non-story. Only losers of elections care about their legitimacy until they are exposed. This goes for MSNBC, Fox and CNN.
I guess the unions weren't hurting after all to bus in all those people and pay for Al Sharpton and the like to speak. Not much difference from the Tea Party, are they?
Read harder next time.
Robert points out how both left and right (so called) spent money in the New Whirl Odor of mass spending on shiny media things.
It doesn't appear to have done a goddamn thing. It canceled out each other, to stay in the same place as before.
I'm an expatriate Cheezer and former educator there. The problem in Wisconsin was that the Democrats at both the national and state levels are too caught up in their power games to have made much of a connection with Wisconsinites at the local/community level, and built trust.
Look at how the party treated Russ Feingold all his career; he was just too independent for them. In fact he represented a wide variety of Wisconsinites pretty well, and could have won if Democrats had bothered to vote in the population centers last November.
The "tea party" Republicans, independents, and disaffected Dems motivated their base with a bunch of (frankly silly) memes about Outsiders being more qualified. That, on top of the infusion of $37 million in corporate bling to get Scott Walker elected, worked.
But it probably wouldn't have if Milwaukee County and Dane County (Madison's) hadn't had THE LOWEST VOTER TURNOUT IN AGES…while the rest of the state turned out voters in record numbers.
And consider this: all those youngsters who coursed to the polls to vote for Candidate Obama didn't turn up in November of 2010. Either they were lazy and unmotivated...or they managed to see through his street-mime magic act (nothing passing as real things; political infotainment).
This isn't about politics and it surely isn't about party politics, because there is just one party, the Money Party. It represents those who via numbers games skim the butter that the productive members of society churn, and leave them the whey.
And both of those parties believe in the mass media more than anything else.
Sidebar: some of my old Farm Labor Democrat buddies from the Green Bus (Wellstone) years think that the Democratic party gave the November 2010 elections in Wisconsin a bit of a miss, to engineer a spectacular loss, to spur (in their minds) a spectacular comeback.
I can't say that that's true, though it's a better conspiracy theory than most. But it does attest to a remarkable belief in the conspiratorial might of a party that, in my view, more likely has become so weak and appeasement oriented, so lazy and immersed in Baby Boomer ways of thinking, that it's flailing. (The Republicans are in about the same situation.)
Anyone else see Matt Miller's piece in WaPo today? I don't normally go near the Newspapers of Record; a friend sent me the link.
http://www.washingtonpost.com/opinions/why-im-mad-at-obama/2011/08/10/gI...
A gift for naming
Very good ... "Animist Drive-by" and "New Whirl Odor"!
Yes, they do believe in mass media more than anything else, because it continues to pay off for them. The one thing that George Orwell did not foresee is the system whereby the State doesn't need a spy-eye in every living room as long as they have a "look here for eye-candy, illusions and (self-destructive) delusions" screen in every room.
More and more, I don't divide people according to 'left' or 'right' or 'liberal' or 'conservative'. I know two kinds of people: those who still pay attention to it (corporate news media, including NPR and PBS) regularly ... and those who almost don't watch it at all. These two groups live in different worlds.
The problem is that those who have tuned out, mostly do not vote. Many are convinced that the count is corrupted anyway.
" ... the rest of the state turned out voters in record numbers."
Did they? Or did their voting and vote-counting computers count differently?
Just asking. I don't know the answer.
tax Derivatives
Making Bush tax rates permanent will require bipartisan support. Re
publicans will insist on adherence to the Norguist no tax rate increase pledge. Democrats will require increased revenues to replace the loss which will come with no change in existing tax law. There is a $600 trillion market which will accommodate both conditions.
Derivatives.
The $600 trillion market for Derivatives is 40 times the value of the US stockmarket - yet most Americans have never heard of it. A tiny 0.5% transfer fee when these billion dollar contracts trade would raise $4 trillion over 10 years - enough to cover the Bush tax rates (which are scheduled to bring in an additional $3.8 trillion) at current levels. Something both sides can agree to and still declare victory.
No change from current income tax brackets. No cuts to Medicare or Social Security.
Whoever announces this solution first will reap a publicity windfall which will improve their standing in the polls and bring in substantial campaign contributions. It is a race to be the leader who puts this idea into the public domain and champion a position both sides can support.
See www.howtopayoffthenationaldebt.wordpress.com for details.
tax derivatives, comment
Here we have promoted transactional taxes, tobin taxes, VAT, pretty much anything that taxes those HFTs and taxing derivatives seems like a no brainer. One problem, many of them should be banned, out of existence. CDSes for example, mathematically, it doesn't work, the relationship has to be 1 to 1. In other words, you cannot have someone buy into a CDS who doesn't have a stake in the underlying asset, i.e. Soros is right (not that I agree with what he thinks most of the time).
Promoting taxes that generally shape behavior that the U.S. wants economically, we're all for here on this site and love people to talk about them since most of the public has no clue about taxes generally.
WOULD require bipartisan support, if ...
Remarks by Jim Kainz and Robert Oak as to educating the public are well taken, and I voted for both comments.
HOWEVER, it isn't as though there's nothing available in the way of easily readable analysis, in terms anyone can understand! See, David Cay Johnston's Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich - and Cheat Everybody Else. The situation is known, and everyone should call their congress-crittur and let them know that we know that they know ... and we don't appreciate that loopholes are treated like sacred cows, while our intelligence is insulted by Congress.
"Making Bush tax rates permanent will require bipartisan support." -- Jim Kainz
WRONG VERB! We need to know the truth:
"Making Bush tax rates permanent
willwould require bipartisan support, assuming bipartisan support were a possibility."The sentence should be constructed according to the old saw: "Beggars would fly, assuming that wishes were horses."
It's been obvious since December 2010 that there's no chance whatsoever to put an end to the Bush tax cuts until, at the earliest, 2013. That's just reality ... as opposed to political fiction.
Jim Kainz is apparently speculating on developments in the context of the up-or-down votes that will be required when the SuperCongress comes up with a plan to gut U.S. social safety nets over the coming decade. (If the proposals are rejected, pre-arranged spending cuts are to be automatically triggered by the terms of enacted legislation.)
(BTW: I agree with Ron Paul that the Super Congress concept, like all 'fast-track' legislation, is a disaster for democracy and of questionable constitutionality. I often find myself agreeing with Paul on principles; however, I disagree with Ron Paul on many issues, including his vote against raising the debt limit.)
If anyone expects that Bush tax cuts will not be continued in the Super Congress recommendations, they'd best be thinking in terms of a veto from Obama of the legislation as enacted by Congress! Even then, after the December 2010 legislation, I'm not sure that Obama could prevent continuation of the Bush tax cuts by a veto of the up-coming legislation.
Clearly, if Obama were thinking to step up to the plate on behalf of his core constituency (voters represented by the Black Congressional Caucus), he should have vetoed the legislation in December 2010, but he was advocating it at that time!
I don't want to be thought to be an apologist for Obama, and I am not saying that Obama will veto the up-coming Super Congress legislation or even that a veto would prevent continuation of tax loopholes, but it is what it is! We might as well think in terms of a veto by Obama as think in terms of even minimal Republican support for a bipartisan compromise representing the best interests of American working families.
On examination, Kainz's underlying premise is false that there is even a remote possibility of any meaningful bipartisan compromise to eliminate loopholes in the IRC. Kainz's conclusions are, therefore, just plain nonsense. (Would you make your investment moves based on such fiction?)
Examine it:
Republicans on the Super Congress committee will vote in lockstep and need only one Democratic vote. Max Baucus will be only too happy to oblige. In the former (Democrat-controlled) congress Baucus led Obama's December "tax cuts for the middle class (including the super-rich and MNCs)" alternative to simply letting the cuts expire on December 31, 2010! The earlier Obama proposals and the December thing were two different animals entirely.
Let me be perfectly clear: if Congress had done nothing in the lame duck session, the Bush tax cuts for the rich would have expired on December 31, 2010!
Baucus acted aggressively to prevent the expiration of the cuts! Further, Baucus will not have to run again until 2014, by which time he will have acquired assets and MNC connections making it totally painless for him or his ego to step down rather than run!
Republicans in House and Senate will lockstep vote Yea on the Super Congress recommendation, and enough Democrats will go along in the Senate to send the bill to the President. At that point, Obama will get a final chance, that he is very unlikely to take, to show a determination to at least try to represent his most central core constituency - the African-American vote - as we seriously advance into 2012 presidential election mode.
How many Republicans in Congress support eliminating loopholes in the IRC? Maybe Chuck Grassley. If you know of any others please name them and indicate evidential basis therefor. Yes, there are many Democrats who are part of the Money Party and will not support eliminating loopholes, but not all. Virtually all the Republicans are locked into their rhetoric, dependent on RNC support, or outright bought by MNC and other large contributors to campaign funds and who knows what is hidden?
Kainz's premise is faulty in assuming that Republicans in Congress, with probably fewer than ten exceptions, have any interest whatsoever in eliminating loopholes in the IRC.
Again, I don't want to be seen as an apologist for Obama, and Obama likely will not exercise veto power. However, on a preponderance standard, it's clear that the problem with cutting loopholes in the budget 'negotiations' was that Boehner and friends equated elimination of loopholes to "raising taxes"! This flowed from the Norquist position that their criterion for "tax increase" was "increased revenue."
There is little or no doubt that the TP/GOP demand was to cut spending (except no substantial cuts to the military budget while also retaining the 'off budget' war fiction) and reduce revenue (rejecting any kind of revenue increase by way of elimination of loopholes or otherwise).
You can try to argue around this reality, and it's probably never confronted on FOX News, but it's pretty clear on the preponderance standard. See, e.g., Examiner.com as excerpted below --
On the other hand, congressional Democrat leaders cannot be held blameless for letting a precious opportunity go in 2010! Obama right up to the November election (going back at least to August) was supporting a sane compromise that would have been welcomed by Warren Buffet!
All the Democrats needed to do was (1) Nancy Pelosi let the legislation go to the floor for a vote, and, (2) Harry Reid rule it to go direct to vote up-or-down in the Senate, no cloture rule need apply, no messing around with reconciliation by a chosen few appointed to a back-room senate-house joint committee. Reid always says, "We didn't have the votes." Okay, in that case, let that lack of votes be on the record! Can you rob American working people, but be too delicate to embarrass a Senate colleague in an election year?
In other words, the Democrats needed nothing but to recognize that an election was coming in November and they were staring down the jaws of defeat! All they had to do was SOMETHING OUTSIDE THE BOX! All they needed to do was decide that they had to do SOMETHING for the all the working families of America, even if it would make them look good!
Democrat leaders in 2010 had that choice! Yes, it would have been spun by the GOP spin-machine as a terrible example of Communism at work, but whatever the Democrats do is always spun that way. Meanwhile, it would have been seen by all sane folk as a COMPROMISE appealing to swing voters, appealing to the idea of fiscal integrity! What is wrong with Democrat leaders in Congress? Could it be the exact same thing that is wrong with Republican leaders in Congress?
See, NYT article 'Analysis Looks at Effect of Letting Tax Cuts Lapse for Rich' (August 11, 2010), as follows --
Also see, NYT's Economic Scene by David Leonhardt (2 November 2010), '5 Options for Congress to Cut Taxes' --
What was the Democrats problem? As pointed out by Leonhardt, proposals to enact sane tax legislation were supported by the Financial Times ... and if that isn't enough, rolling back the Bush tax cuts has been advocated by Alan Greenspan since July 2010 and since. Cheeeesh!
Also see, PoliticalProf's 'A Thought On The Bush Tax Cuts' (3 August 2011).
a slightly more realistic delusion
I am still saying "Let's give the Tea Party a chance!" If they can stand up and lead some real opposition to the FTAs, which are all about tax loopholes ... okay, then we are seeing something worthy. The votes won't mean anything unless the progressive Democrats get some opposition to the FTAs going too, but we have seen some across-the-aisle opposition to politics-as-usual with TPers joining progressive-populist Democrats already. So it's possible.
On the issue of eliminating some tax loopholes, when so far that's been a dead letter with TP congress critturs, I could argue the possibility of it like this:
Boehner and the TP had 'no choice' but to insist that even the elimination of well-known loopholes could not be considered in any negotiations because they and their supporters were heavily influenced by personal stakes in the bull market in gold. Now that gold is riding high again, things have changed. Boehner and the TP perhaps are going to begin to consider the possibility that sometime in the next two or three months might be a good time to cash out their gold.
That's probably delusional, of course, but it's the only way that I can see to justify any positive (non-zero) expectation that the current Congress will make any progress whatsoever toward reforming loopholes in the IRC. (Specifically, I am referring to loopholes identified by David Cay Johnston, e.g., in his book Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich - and Cheat Everybody Else. )
The rationale for adamant opposition to cutting loopholes in the context of the budget 'negotiations' was that such a move would have been tantamount to increasing revenue, which by TP 'logic', equates to "raising taxes"
But suppose there's more to a book than its cover ... suppose that some politicians actually sometimes mix private financial and public economic decisions.
Suppose that you were offered an opportunity to transform much of your huge gold amount into cash at a time when equity markets are low ,,, maybe you can even finagle some margin ... tax benefits galore ...
1. Period of Rising Uncertainty (May-August, 2011)
Immediately after Boehner walked out of negotiations on the budget, July 22, having earlier made his nod to the TP by way of Rush Limbaugh, July 21, what happened? Surprise! Gold markets quickly reacted, beginning with a nibble on July 22.
A great opportunity was thus created for anyone who might have 'guessed' or 'predicted' the event -- that opportunity being specifically presented by the timing of Boehner's surprise walk-out on a late Friday.
At closing of APMEX on Monday, July 25, gold was at an all-time high of $1615.40. During the previous week, gold fell for three straight days (July 19-21) to $1587. After Thursday's indications from Boehner, and more so since the interestingly timed walkout on July 22, gold rose continuously until August 11, when it declined after CME's increase in margin required for gold buyers. Previous to the CME move, platinum was trading at less than gold, and even professional goldbugs were advising moving from bullion into gold miners. (That is, professionals were taking note of a bubble in the gold market, although not abandoning an overall bullish position.)
Based on analysis of log-linear oscillations in the gold price dynamics for 2003–2010, Askar Akayev's research group forecast a collapse in gold prices in May-July 2011. As of week beginning Monday, July 18, that collapse had not yet occurred, and question is moot as to whether the three-day decline July 19-21 could have led to something like that, absent the Boehner/TP shenanigans.
By way of background, Akayev, president of Kyrghyzstan 1990-2005, has been described as a 'prodemocratic physicist'. The Kumtor Gold Mine in Kyrshyzstan produced more than 5.8 million ounces of gold from its opening in 1997 through the end of 2006;
2. Period of the Gold King (August-September, 2011 .... or longer?)
Ron Paul has suggested a target for gold of $5000. Is that realistic for 2011? Probably not. It's neither more nor less than the goldbug philosphy echoed by a politician. (If gold goes that high this year, that will mean that currency is giving way not to gold but to guns and ammo.)
3. Period of the Gold King giving way to the Blue-Red-White alliance (October-November, 2011)
(Order of colors indicates relative value of chips -- blue, red, and white -- the colors also being the national colors of the USA, because the dollar rises when gold falls, but in that context the order is changed to Red, White, Blue.)
In this period, it may be that insiders will be preparing to cash out their gold to buy into equities. What? Have they no principles?
Could they do that? Well, if the market were seen as reacting to the good news of enactment of the recommendations of the Super Congress ... sure, they could. Or not. Who knows?
If that's what happens, then the insiders might allow something to pass through the Super Congress to be rubber-stamped by the lesser congress, (the congress authorized by the Constitution), that would actually tend to stabilize the NYSE (potentially bad news for brokers)-- something like not exactly tax increases, but anyway revenue increases. Something that would tend to move the dollar upwards, that is, gold downwards. It is possible, after all, to make money by shorting a commodity or currency (whatever you like to consider gold to be).
Of course, I don't know that this will happen. It doesn't pay me to make such predictions.
I'm just saying this is a slightly more realistic delusion than the delusion that Republicans will want to cooperate with Democrats to eliminate some egregious tax loopholes just because it's the right thing to do by American working families.
4. The final period of 2011 will be the Holidays. It is then that I shall reflect. Am I becoming too cynical in my old age?
King Gold continues high ride
How's this for reality-based economics? Here's why it's relevant here at EP: the global gold market is as much about mass (herd) psychology as it is about either fundamental or technical analysis of commodity markets. (See, e..g., Mackay's Extraordinary Popular Delusions and the Madness of Crowds.)
I continue my analysis of gold in the current global situation, namely that gold will continue to ride high for another month or so, but that there will be a moderating realism probably about the same time as Obama signs off on Super Congress legislation.
However, there's one item about November that may be significant.
Image above is from video "11-11-11, Astrology and Prophecy" at YouTube --
November 11, 2011
I can't explain it except astronomically or biblically, but something big may hit on or about November 11, 2011, although by numerological analysis it could hit the 5th, 14th or 23rd as well. Not concerning gold exactly, but something else, something that will deliver a shock around the world -- not necessarily bad and maybe even benign (especially if what happens is nothing).
We don't have to go to interpretations of the Book of Revelations to understand this point. Whether a US citizen is bullish on gold, up to and including the $5000 or the $10,000 'target', seems to directly correlate with a negative emotional response to, e.g., the word 'Obama'. I think pictures could be even better than the name in print or spoken, but I feel confident that such a correlation could be shown using standard psychological experimentation methodology. Of course, there is a fundamentals aspect to gold that cannot be denied, but does that really justify rationally holding onto gold until it hits $10,000 ... or even thinking in such terms? I mean, if it's going to get that bad, that fast, criminalization and even confiscation of gold becomes as likely as anything else! (Much more likely than criminalization and confiscation of personal firearms, IMO.)
If nothing much happens in November, then gold will likely go back to its former status as a commodity, neither more nor less, and the great bull market in gold will be forgotten for 2012 except in news roundups of 2011. Much depends on capacity of producers, but there's no more reason to be concerned about the exhaustion of gold than there is to be concerned about the exhaustion of oil or high grade ("steel") coal, and many others.
Of course, gold will continue as a hedge against inflation, but not the only such hedge.