With a very narrow margin in the Senate, and with the tax reform bill being among the most unpopular (only 38% voter support across both parties according to recent polls) pieces of seminal legislation in American history, and with tons of local protests even in Republican states and districts, the GOP has one thing on its mind: push that vote through Congress before one more Democrat – Doug Jones – is seated in the Senate. Why? Because after almost a year of trying to kill the Affordable Care Act, the Republican Congress has not passed one single campaign-promised piece of major legislation. As flawed and raw as the tax bill is, there is pressure on the GOP to get something big done before the campaigns for the 2018 mid-terms turn into full sway. And right now, this bill is operating under a cloture exception (nuclear option) where the GOP can pass this bill with a simple majority.
Further, the US stock market is flying high based solely on the expectation of that lovely 21% permanent federal corporate tax rate (down from 35%). Everyone already knows that the fall in the unemployment rate is not because of lots of new, high-paying jobs… but because marginal jobs, the gig economy and the complete withdrawal from a job search of another swath of under-skilled blue collar workers in an increasingly automated economy, have skewed the statistics to “lookin’ good.” Ask young recent college grads, with massive student debt, if they agree.
So Donald Trump’s touting of a strong US economy is based pretty much on the strength of that stock market. Self-directed individual investors, mostly through their pension accounts, account for less than half the stock ownership in the United States, and most of that individual ownership is concentrated in the top 10% of our economic ladder. The rest of US ownership of stocks is with institutions. So if for any reason, that disastrous tax reform bill were to fail, share prices of US stocks will plunge, literally killing the only bona fide statistic that Trump can claim as an economic triumph for him and the GOP. A double whammy would result: Unable to pass a big bill and losing the one positive economic statistic they have.
Failure to deliver those tax cuts pretty much tells GOP donors they are riding the wrong horse. For the rest of US, being saddled with higher healthcare costs (because that tax reform act also dismantles the ACA healthcare mandate), paying off an extra trillion dollar plus deficit while facing GOP-promised cuts to Social Security and Medicare benefits, getting a very temporary tax cut for some individual taxpayers is hardly good news. Top CEOs have also pretty uniformly stated that their tax windfall is not sufficient justification for them to go on a hiring spree and create a ton of well-paid new jobs. They remain skeptical of the level of real consumer demand out there… whether there is enough discretionary income to justify such corporate expansion. In short, for most of us, the overwhelming balance of economic reality is negative if this becomes law. An expected recession following such tax legislation is yet another corporate America is unlikely to invest in “growth.”
But since there is reasonable uniformity, even among savvy GOP economists, that this tax reform act is unlikely to raise the overall economy – in fact if that extra money is used by corporate America to buy back their own stock or engage in a merger/acquisitions frenzy as expected, the net result will be massive new layoffs that always follow such efforts – why are they fighting so hard to pass it? One: it shows they can pass a major piece of legislation. Two: their corporate donors have built their entire business expectations on passage. Three: Under the new “kick the can down the road” Congressional mantra, they will deal with the negative issues later, hopefully after they score in the 2018 mid-terms by touting this as a “successful” GOP gift to America… until it fails.
Enter the unexpected victory of a Democrat, Doug Jones, in the ruby-red Alabama Senate special election. Backed by younger voters and a powerful African-American constituency, there is little doubt where Jones stands on that proposed “perhaps reconciled” tax reform legislation. If given the chance, he will vote, like every other Senate Democrat, against the bill. There are already a couple of teetering Republicans, from deficit hawks to Senators from states where their constituency has expressed strong negative feelings about the bill, and the GOP at least needs a 50-50 vote (tie-breaker to VP Mike Pence) to make that bill into law (Trump has indicated he will sign the bill the instant it is passed). If Doug Jones were seated in the Senate today, the Dems would have 49 votes to the GOP’s 51.
The Alabama election awaits a formal certification of Jones’ December 12th victory, ostensibly with a 1.5% margin. Military ballots need to be added to the mix, write-ins need to be verified, and the “final” result is not expected until the first week of January. GOP losing candidate, Roy Moore, has yet to concede, believing that God will deliver a recount and reversal of the election night results to him. If the official margin of victory for Jones falls to 0.5% or less, Alabama law mandates a recount. If the margin is higher, then any Alabama institution or individual with standing (that would include the Moore campaign) can demand a recount, which would be conducted at their expense. Even the Alabama Secretary of State has indicated that there is virtually no scenario he can envision that would hand that Senate seat to Roy Moore.
For the GOP, getting that clearly-flawed tax reform act through Congress needs to happen before Jones is seated, and that means a combination of rushing the bill through while also attempting to delay Jones’ taking his Senate seat. How have Republicans reacted in the recent past, when the roles were reversed and a Republican candidate was waiting in the wings to be seated in the US Senate?
Andy Kroll, writing for the December 13th Mother Jones, did a little historical research: “Look no further than Jay Sekulow, who now serves as one of President Donald Trump’s private attorneys. Writing a mere week after Massachusetts Republican Scott Brown’s stunning victory in the January 2010 special election to fill the late Ted Kennedy’s seat, Sekulow said it was ‘outrageous’ that Brown had not yet been seated and allowed to participate in the health care debate:
Here’s the troubling reality: It’s been nearly one week now since Scott Brown was elected to the U.S. Senate by the voters of Massachusetts. And, Senator-elect Brown has not yet been seated. He is not yet a member of the U.S. Senate and can’t participate on the work currently underway in the Senate itself.
In my view this is an unacceptable delay tactic on the part of the Senate leadership a tactic that disenfranchises the voters of Massachusetts who sent a strong message in the election of last week.
There’s absolutely no reason to wait to seat Senator-elect Brown and with each passing day he is prevented from participating in the legislative process. This delay tactic along with reports that top Democrats continue to plot passage of health care reform show that its business as usual in Washington ignoring the will of Massachusetts voters and moving forward with a disturbing health care plan that America simply does not want.”
History, demographics and simple Christian morality (support for obvious sexual predators is creating a pretty nasty and hypocritical connotation for the “evangelical” label these days) are not on the GOP side. Some of that negativity is also directed at Democrats, who have yet to articulate exactly what they stand for (versus against). We may be witnessing the last great stand for that Tea Party/evangelical movement within the GOP, an admission that Trump populism did not deliver, but like any cornered cat facing extinction, we are going to witness some nasty tactics and desperate efforts that could permanently destabilize our entire political system.
I’m Peter Dekom, and how do I express my “red alert for America” in any way that can make a difference?
Posts
No comments:
Post a Comment