Talking Sides:
Two years ago President Barack Obama railed against a certain type of political action committee known as super PAC's as a "threat to our democracy". Today his reelection campaign confirmed that both administration and campaign officials will fundraise for Priorities USA Action, a super PAC backing the president.
In October of 2010, shortly before the shellacking his fellow Democrats took in the mid-term elections, Mr. Obama spoke at a rally in Philadelphia. He attacked these groups which the Supreme Court ruled could raise unlimited sums from corporations, unions and other groups, as well as individuals. He implied they all had sinister motives and told outright lies about foreign entities being involved in swaying US elections.
"You don’t know," he said. “It could be the oil industry, it could be the insurance industry, it could even be foreign-owned corporations. You don’t know because they don’t have to disclose. Now that’s not just a threat to Democrats, that’s a threat to our democracy."
During the same time, the Democratic National Committee produced an advertisement accusing the US Chamber of Commerce of using secret foreign funds to influence US elections; actions which would have violated existing law. When the president’s senior adviser David Axelrod was asked by CBS's Bob Sheiffer if he had any evidence that the claim was true his reply, "Well, do you have any evidence that it's not, Bob?" exposed the allegations as the desperate lies they were.
Evidently these threats to our democracy don't seem so threatening to our Campaigner-in-Chief anymore. Obama Campaign Manager Jim Messina sent out an e-mail to supporters saying that, "The campaign has decided to do what we can, consistent with the law, to support Priorities USA in its effort to counter the weight of the GOP super PACs." Mr. Messina added, "We will do so only in the knowledge and with the expectation that all of its donations will be fully disclosed as required by law to the Federal Election Commission."
Now that Obama & Company have acknowledged that super PAC's are legitimate groups of Americans legally participating in the political process subject to reasonable oversight, will he apologize for the wild and baseless accusations he and his cronies made against them when it suited his political purposes to do so? Somehow I doubt it.
Tuesday, February 7, 2012
Report: Father of man who killed sons in suicide house fire 'person of interest' in son's wife's disappearance
Fox News:
GRAHAM, Wash. – The father of a man who killed himself and his two young sons in a house fire Sunday has been named as a person of interest in the disappearance of his son's wife, KCPQ-TV reports.
Steven Powell is currently in jail and facing child porn and voyeurism charges. He claimed in previous television interviews that he and Susan Powell were falling in love and even implied a sexual relationship had occurred.
"Susan was very sexual with me," Steven Powell said in one interview at the time. "We interacted in a lot of sexual ways because Susan enjoys doing that."
Susan's father denied the allegations and said Steven Powell had been initiating unwanted sexual advances, and that his daughter had no interest in her father-in-law.
The elder Powell, 61, was arrested at his Washington state home and accused of secretly videotaping his daughter-in-law, other women, and young girls taking baths and sitting on the toilet in neighborhood homes last year.
The new report is another twist in the very public scandal that began when Susan Powell vanished in 2009. Josh Powell had been the only person of interest named in his wife's disappearance.
Steven Powell has been reportedly placed on suicide watch following his son's and grandson's deaths.
Authorities in Washington state said Monday evening that the Powell's sons suffered severe chopping injuries to their heads or necks as they died in a house fire set by their father Sunday.
Smoke inhalation was the primary cause of death for Josh Powell and his two young sons, the Pierce County Medical Examiner's Office said. But the boys also suffered "chop injuries" that contributed to their deaths.
A social worker brought the two boys to Josh Powell's home Sunday for what was to be a supervised visit, and Powell let his sons inside -- but then blocked the social worker from entering, authorities have said.
The social worker called her supervisors to report that she could smell gas. Moments later, the home burst into flames, igniting an inferno that neighbors said rattled their houses.
Investigators searched through the charred rubble of the home Monday and released new details about what they described as Powell's deliberation in killing himself and his children, who had been removed from his care -- a horrifying climax to a long, bizarre saga. They found the two 5-gallon gas cans inside.
"This was definitely a deliberate, planned-out event," Pierce County Sheriff's Detective Ed Troyer said.
Jeffrey Bassett, who represented Powell in the custody case, said he received an ominous email from his client just minutes before the fire.
"I'm sorry, goodbye," it read.
Authorities said Powell sent longer emails to some people, including his cousin and pastor, with instructions such as where to find his money and how to shut off his utilities. But none of the emails said anything about what happened to his wife.
The maternal grandparents of Josh Powell's two sons say the boys were playing happily Sunday and didn't want to visit their father.
Charles and Judy Cox tell KIRO-TV that the grandmother talked them into a supervised child custody visit with their father.
When the boys arrived at Powell's Washington state home, their father barred a social worker from entering and then lit the house on fire.
Charlie and Braden Powell shared a bedroom in the Cox's Puyallup home since last fall, when they were removed from their father's custody.
The Coxes are parents of Susan Powell, who has been missing since 2009. Josh Powell was a person of interest in her disappearance in Utah.
Investigators tried to fill in holes Monday in the case with an arson investigation at the home and autopsies on Josh Powell and his sons, said Troyer. Local detectives also are meeting with police from West Valley City, Utah, who have been looking for Susan Powell.
Steve Richards, assistant chief of Graham Fire and Rescue, said crews were assessing the remnants of the home to determine how the fire began and what types of accelerants might have been used. He said responders arrived on scene about three minutes after getting the call and found flames already through the roof.
"It was just devastation," he said.
Fire investigators were slowly moving around the home Monday morning, measuring areas both inside and out. All the bodies were found Sunday in one room in the middle of the home, Troyer said.
A candle light vigil was held Sunday night for the boys outside the 7-year-old's school in Puyallup.
The investigation will include a closer looks at Josh Powell's last movements and messages.
Chaplains have been working with the family of Susan Powell.
The Washington Department of Social and Health Services said the social worker who brought the boys to Josh Powell's home for what was to be a supervised visit is "suffering from grave emotional trauma as a result of the horrific event." The department will conduct a formal child fatality review.
She did all she could, Troyer said.
The social worker called her supervisors to report that she could smell gas. Moments later, the home burst into flames, igniting an inferno that neighbors said rattled their houses. Some sort of accelerant was used to make the house burn faster, Troyer said.
Susan Powell, a 28-year-old mother of two, was reported missing Dec. 7, 2009, after she failed to show up for her stockbroker job in Utah.
Authorities in the couple's hometown of West Valley City, about 10 miles outside Salt Lake City, quickly turned their attention to Josh Powell. He was a "person of interest" in the case, but had repeatedly denied any involvement in her disappearance.
"I would never even hurt her," a tearful, red-eyed Josh Powell told CBS' Early Show in August. "People who know me know that I could never hurt Susan."
About a month later, police spent 12 days in the remote central Utah desert looking for clues, and Josh Powell and his father quickly disappeared from the limelight. The search area around Topaz Mountain, a popular spot for rock and gem hunters, was about 30 miles south of where Josh told police he went camping with his two children in the hours before his wife's disappearance -- his steadfast alibi.
On Sunday, the lawyer for Susan Powell's parents, Chuck and Judy Cox, told the AP the children had started talking to their grandparents about things they remembered from the night their mother vanished.
"They were beginning to verbalize more," said attorney Steve Downing, whose clients had custody of the children. "The oldest boy talked about that they went camping and that Mommy was in the trunk. Mom and Dad got out of the car and Mom disappeared."
Police turned up no clues in their desert search.
GRAHAM, Wash. – The father of a man who killed himself and his two young sons in a house fire Sunday has been named as a person of interest in the disappearance of his son's wife, KCPQ-TV reports.
Steven Powell is currently in jail and facing child porn and voyeurism charges. He claimed in previous television interviews that he and Susan Powell were falling in love and even implied a sexual relationship had occurred.
"Susan was very sexual with me," Steven Powell said in one interview at the time. "We interacted in a lot of sexual ways because Susan enjoys doing that."
Susan's father denied the allegations and said Steven Powell had been initiating unwanted sexual advances, and that his daughter had no interest in her father-in-law.
The elder Powell, 61, was arrested at his Washington state home and accused of secretly videotaping his daughter-in-law, other women, and young girls taking baths and sitting on the toilet in neighborhood homes last year.
The new report is another twist in the very public scandal that began when Susan Powell vanished in 2009. Josh Powell had been the only person of interest named in his wife's disappearance.
Steven Powell has been reportedly placed on suicide watch following his son's and grandson's deaths.
Authorities in Washington state said Monday evening that the Powell's sons suffered severe chopping injuries to their heads or necks as they died in a house fire set by their father Sunday.
Smoke inhalation was the primary cause of death for Josh Powell and his two young sons, the Pierce County Medical Examiner's Office said. But the boys also suffered "chop injuries" that contributed to their deaths.
A social worker brought the two boys to Josh Powell's home Sunday for what was to be a supervised visit, and Powell let his sons inside -- but then blocked the social worker from entering, authorities have said.
The social worker called her supervisors to report that she could smell gas. Moments later, the home burst into flames, igniting an inferno that neighbors said rattled their houses.
Investigators searched through the charred rubble of the home Monday and released new details about what they described as Powell's deliberation in killing himself and his children, who had been removed from his care -- a horrifying climax to a long, bizarre saga. They found the two 5-gallon gas cans inside.
"This was definitely a deliberate, planned-out event," Pierce County Sheriff's Detective Ed Troyer said.
Jeffrey Bassett, who represented Powell in the custody case, said he received an ominous email from his client just minutes before the fire.
"I'm sorry, goodbye," it read.
Authorities said Powell sent longer emails to some people, including his cousin and pastor, with instructions such as where to find his money and how to shut off his utilities. But none of the emails said anything about what happened to his wife.
The maternal grandparents of Josh Powell's two sons say the boys were playing happily Sunday and didn't want to visit their father.
Charles and Judy Cox tell KIRO-TV that the grandmother talked them into a supervised child custody visit with their father.
When the boys arrived at Powell's Washington state home, their father barred a social worker from entering and then lit the house on fire.
Charlie and Braden Powell shared a bedroom in the Cox's Puyallup home since last fall, when they were removed from their father's custody.
The Coxes are parents of Susan Powell, who has been missing since 2009. Josh Powell was a person of interest in her disappearance in Utah.
Investigators tried to fill in holes Monday in the case with an arson investigation at the home and autopsies on Josh Powell and his sons, said Troyer. Local detectives also are meeting with police from West Valley City, Utah, who have been looking for Susan Powell.
Steve Richards, assistant chief of Graham Fire and Rescue, said crews were assessing the remnants of the home to determine how the fire began and what types of accelerants might have been used. He said responders arrived on scene about three minutes after getting the call and found flames already through the roof.
"It was just devastation," he said.
Fire investigators were slowly moving around the home Monday morning, measuring areas both inside and out. All the bodies were found Sunday in one room in the middle of the home, Troyer said.
A candle light vigil was held Sunday night for the boys outside the 7-year-old's school in Puyallup.
The investigation will include a closer looks at Josh Powell's last movements and messages.
Chaplains have been working with the family of Susan Powell.
The Washington Department of Social and Health Services said the social worker who brought the boys to Josh Powell's home for what was to be a supervised visit is "suffering from grave emotional trauma as a result of the horrific event." The department will conduct a formal child fatality review.
She did all she could, Troyer said.
The social worker called her supervisors to report that she could smell gas. Moments later, the home burst into flames, igniting an inferno that neighbors said rattled their houses. Some sort of accelerant was used to make the house burn faster, Troyer said.
Susan Powell, a 28-year-old mother of two, was reported missing Dec. 7, 2009, after she failed to show up for her stockbroker job in Utah.
Authorities in the couple's hometown of West Valley City, about 10 miles outside Salt Lake City, quickly turned their attention to Josh Powell. He was a "person of interest" in the case, but had repeatedly denied any involvement in her disappearance.
"I would never even hurt her," a tearful, red-eyed Josh Powell told CBS' Early Show in August. "People who know me know that I could never hurt Susan."
About a month later, police spent 12 days in the remote central Utah desert looking for clues, and Josh Powell and his father quickly disappeared from the limelight. The search area around Topaz Mountain, a popular spot for rock and gem hunters, was about 30 miles south of where Josh told police he went camping with his two children in the hours before his wife's disappearance -- his steadfast alibi.
On Sunday, the lawyer for Susan Powell's parents, Chuck and Judy Cox, told the AP the children had started talking to their grandparents about things they remembered from the night their mother vanished.
"They were beginning to verbalize more," said attorney Steve Downing, whose clients had custody of the children. "The oldest boy talked about that they went camping and that Mommy was in the trunk. Mom and Dad got out of the car and Mom disappeared."
Police turned up no clues in their desert search.
Revolving door between Wall Street, White House spins faster
US Treasury: Manhattan transfer
By Tom Braithwaite and Ajay Makan
Rapid staff turnover is raising fears that the department is precariously short of seasoned professionals
Financial Times:
Three years ago Wall Street employees flocked to Washington, attracted by the energising rhetoric of Barack Obama, the call of public service and the sudden dearth of jobs in the financial sector.
In the chaotic first days of the Obama administration, the best qualified were thrown into the Treasury department to deal with the financial crisis. Now many have left, returning to the private sector through the famous “revolving door” that separates prize jobs in government from those in business.
Last week alone, Lazard announced that Ron Bloom, one of its former bankers who later managed the government’s rescue of the US car sector, was returning to the firm as a senior adviser; and it emerged that Goldman Sachs was close to hiring Jake Siewert, a former top aide to Tim Geithner, the Treasury secretary.
The Treasury says the churn is a natural result of measures taken to fight the crisis, with staff hired specifically to deal with the emergency of 2008 and 2009 departing once the worst was over. But some insiders and several of the departed officials say it leaves the administration short of qualified personnel at the agency that – perhaps more than any other – stands on the front line in maintaining the stability of the global financial system.
“Especially in a crisis situation, continuity’s important,” says Sheila Bair. The former chairman of the Federal Deposit Insurance Corporation, the government guarantor of US bank accounts, worked with – and sometimes clashed with – the Geithner Treasury, and is herself a former official of the department during George W. Bush’s administration. “Some turnover is good: having the core of the career staff and some fresh perspective is a nice blend but I think you can carry that too far,” she says.
Certainly, there has been a dizzying traffic of officials at Hamilton Place, the department’s imposing headquarters next door to the White House, ever since Mr Geithner succeeded Hank Paulson as Treasury secretary in January 2009.
Data obtained by the Financial Times under the US Freedom of Information act show that 774 people left the Treasury between the start of the Obama administration in 2009 and August last year. Some 1,227 arrived. The period does not include the “transition”, when the bulk of ousted political appointments make way for the new president’s team. The departures represent more than one in three of the entire department; arrivals, more than one in two.
“The data do not suggest an atypical amount of turnover for Treasury staff,” says Neal Wolin, deputy Treasury secretary. “We hired a lot of staff in the midst of the financial crisis. Many came with term appointments. Their jobs were understood from the very beginning to be finite in tenure.”
Notably the Consumer Financial Protection Bureau, intended to crack down on the misselling of financial products, was created within the Treasury and then spun off as a separate agency, swelling the numbers of both arrivals and departures.
But some close to the Treasury say the turnover has made it hard to create consistency, and that there are relatively few seasoned professionals dealing with an economy that is still shaky.
A congressional aide who deals with the department regularly said the depth of experience has declined: “It’s absolutely stunning. You go over there and I feel old. There’s not a lot of separate and independent intellectual thought.”
One former senior official under Mr Geithner concurs: “My subjective experience was that there were large numbers of relatively young and not that experienced people – a lot of them refugees from Wall Street.”
The Treasury was a problem from the start, with the administration failing to fill crucial positions, partly because Republicans in the Senate were holding up confirmations of Mr Obama’s nominees. Paul Volcker, the former Federal Reserve chairman, went to Congress in February 2009 to call the gaps “shameful”. He added that the Treasury had already been “weakened” in recent years. “It deserves some attention and rebuilding and new strength,” he said. “You can’t be the leading economic power in the world with all the problems we have and have a weak Treasury.”
Following Mr Volcker’s comments, the department did fill many of the gaps – only for new ones to emerge. But it has made concrete achievements: it produced aggressive programmes with the Fed that stemmed financial panic; it drew up sweeping reforms of Wall Street that became the Dodd-Frank act; and it audaciously bankrupted and rebuilt General Motors and Chrysler.
On the negative side of the ledger, its efforts to kick life into the housing market have fallen flat. There is also debate about the department’s success in implementing those financial reforms, which have created new offices with sweeping power over the nation’s financial institutions.
. . .
Some of the turnover is not unique to the current Treasury but rather a function of the US political system, which another of the leavers compares unfavourably with both the UK Treasury and the Fed. “There is a significant structural difference in the US and the UK – primarily, the US has a much larger layer of politicals,” he says. “I think it’s a flawed system, having seen the way things work at the Fed, which is much more like the HM Treasury in [the UK, with its much smaller] number of political appointees.”
At its best, though, the US system brings advantages. In 2009, there was a host of talented individuals wanting to join the Treasury.
“It sounds sort of cheesy or melodramatic or whatever,” says Brian Osias, who worked on the bail-out and restructuring of GM and Chrysler while at the department, “but to me it was exactly what I hoped. Private sector folks with experiences that could be useful to the government and are not permanent skills that the government needs ... it was great way to deliver that and at the same time to have this public service opportunity.” Mr Osias has left the Treasury and moved with two other former officials to Oskie Capital, a hedge fund.
Sadiq Malik, who made the same move, speaks for many when he says his Treasury stint was satisfying but gruelling. “We were trying to do a business plan for GM, which meant we’d spend two days a week in Detroit. The only sleep you’d get would be maybe a couple of hours on the plane. Then we would spend two days in DC, then two days in New York. You really had seven days a week covered in three different cities. I slept under my desk a couple of times because I just didn’t have time to go home.”
The Oskie group is one of a number of clusters of people who moved together from the public to the private sector. According to an analysis of the data obtained from the Treasury, one of the biggest of those groups is now at Ernst & Young. The accountancy firm has built its Washington tax practice around Michael Mundaca, formerly the most senior tax official in the Obama administration, and Eric Solomon, the most senior tax official in the Bush administration, along with at least four other senior officials.
. . .
Today, among the senior ranks, the revolving door between the Treasury and Ernst & Young is more frequently used than the one between the department and Goldman Sachs – the most famous relationship between finance and politics of recent years. Goldman gave the government Mr Paulson, its CEO, and another senior banker, Mark Patterson, who became Mr Geithner’s chief of staff and now manages the bewildering array of departures and arrivals.
The connection with Goldman – which, through regulatory and congressional investigations, drew more unwanted attention after the crisis than any other – is not extinguished, however. Not only is the bank in discussions with Mr Siewer, the former Treasury official; the traffic runs both ways. In an appointment that largely escaped public attention, the Treasury last year hired Tim Bowler, a Goldman managing director, to work in its capital markets division on reforms such as the ban on proprietary trading, which is causing headaches at his old firm.
Other high-ranking lieutenants have also left, some for big private sector financial roles, raising questions about the ranks of talent that remain. “I look at the people who I thought were really smart and really accomplished during the time I was there – they are all gone,” says another former official. “And I don’t see them replaced by comparable people.” Mr Wolin counters: “This current team is the strongest I’ve seen. Anybody who suggests otherwise simply doesn’t know Treasury or the depth of our talent.”
Jeffrey Goldstein, who was in charge of financial regulation, has returned to his old employer, Hellman & Friedman, the private equity firm. HSBC, the UK-based bank under investigation by US authorities for alleged money laundering offences, has hired as general counsel Stuart Levey, who until last year ran the Treasury’s anti-terrorist finance division.
The Treasury notes that many senior officials, such as Mr Wolin, are still in place. But Mr Geithner’s closest advisers often hold vague and flexible titles such as “counsellor” – and of these many have gone. Lew Alexander has joined Nomura, the Japanese bank; Lee Sachs has set up BancAlliance, a lending platform for community banks; Jim Millstein, a former Lazard banker who led the restructuring of American insurer AIG, has established his own firm, taking a cluster of Treasury colleagues.
Even if the revolving door still exists, the Treasury says it is less damaging than in the past. “This president and this administration have – more than anybody before – put in place rules to make sure that people who leave don’t take advantage of their service in their future work,” says Mr Wolin.
For all the departures, there is one constant: Mr Geithner himself. The Treasury secretary survived a barrage of calls for his head in the first two years, gradually closing the gap between the confident and laconic private persona and his initially lightweight public image.
However, he has stayed this long only at the urging of the president, according to people close to him. Even if Mr Obama wins a second term, his Treasury secretary is likely finally to join the exodus.
.......................................................................
The firm that takes the US Treasury’s brightest from public to private sector
Cypress Advisory opened its door for business in 2005 with one clear aim: to operate at the “revolving door” between bright US Treasury officials looking to move into the private sector and clients in the financial services industry looking to hire top talent.
“We are the only firm, I think in the world, that has people who worked directly for the last four Treasury Secretaries,” says Damon Munchus, one of three members of Cypress’ 13 strong team to have joined from the Obama-era Treasury. “We know where to go, and who to see.”
The financial crisis and the resulting growth in regulation have provided fertile ground for Cypress’ combination of contacts on Capitol Hill and economic analysis. The Washington-based company has doubled in size since 2008, according to Patrick Cave, a former assistant secretary for financial institutions who left the Treasury to work for a lobbying firm, before setting up Cypress.
A third of revenue now comes from hedge funds. Cypress provides investment managers with individual political research, which they use to make investment decisions.
“We make a point of not doing written research,” Mr Cave says, “most of our research is communicated orally over the phone, or in discrete emails to select clients.”
When Treasury was stress testing US banks in 2009, Cypress used its network of contacts, to gather intelligence on possible outcomes. Hedge fund clients increased exposure to financial stocks, after Cypress correctly advised that the stress test results would provide a kick to bank share prices.
“We never asked anyone at the Federal Reserve what the results would be, but having worked in government, we had a view that the stress tests could not prove, and would not prove that the banking sector was unsound,” explains Mr Cave. “The view in the markets was that Fed would run stress tests, and let the chips fall where they may. We felt that was a fundamentally inaccurate view.”
Hedge funds are now focused on developments at Fannie Mae and Freddie Mac, as the Treasury grapples with how the government-run housing agencies will dispose of the inventory of foreclosed homes they have accrued during the crisis. Cypress hedge fund clients are planning dedicated funds to invest in the properties once sales begin, according to Mr Cave. Private equity clients are eyeing up service companies that chase up payments on delinquent mortgages, in anticipation of a surge in business. Foreign central banks that hold Fannie and Freddie debt are also now paying for advice on developments in Congress.
Copyright The Financial Times Limited 2012
By Tom Braithwaite and Ajay Makan
Rapid staff turnover is raising fears that the department is precariously short of seasoned professionals
Financial Times:
Three years ago Wall Street employees flocked to Washington, attracted by the energising rhetoric of Barack Obama, the call of public service and the sudden dearth of jobs in the financial sector.
In the chaotic first days of the Obama administration, the best qualified were thrown into the Treasury department to deal with the financial crisis. Now many have left, returning to the private sector through the famous “revolving door” that separates prize jobs in government from those in business.
Last week alone, Lazard announced that Ron Bloom, one of its former bankers who later managed the government’s rescue of the US car sector, was returning to the firm as a senior adviser; and it emerged that Goldman Sachs was close to hiring Jake Siewert, a former top aide to Tim Geithner, the Treasury secretary.
The Treasury says the churn is a natural result of measures taken to fight the crisis, with staff hired specifically to deal with the emergency of 2008 and 2009 departing once the worst was over. But some insiders and several of the departed officials say it leaves the administration short of qualified personnel at the agency that – perhaps more than any other – stands on the front line in maintaining the stability of the global financial system.
“Especially in a crisis situation, continuity’s important,” says Sheila Bair. The former chairman of the Federal Deposit Insurance Corporation, the government guarantor of US bank accounts, worked with – and sometimes clashed with – the Geithner Treasury, and is herself a former official of the department during George W. Bush’s administration. “Some turnover is good: having the core of the career staff and some fresh perspective is a nice blend but I think you can carry that too far,” she says.
Certainly, there has been a dizzying traffic of officials at Hamilton Place, the department’s imposing headquarters next door to the White House, ever since Mr Geithner succeeded Hank Paulson as Treasury secretary in January 2009.
Data obtained by the Financial Times under the US Freedom of Information act show that 774 people left the Treasury between the start of the Obama administration in 2009 and August last year. Some 1,227 arrived. The period does not include the “transition”, when the bulk of ousted political appointments make way for the new president’s team. The departures represent more than one in three of the entire department; arrivals, more than one in two.
“The data do not suggest an atypical amount of turnover for Treasury staff,” says Neal Wolin, deputy Treasury secretary. “We hired a lot of staff in the midst of the financial crisis. Many came with term appointments. Their jobs were understood from the very beginning to be finite in tenure.”
Notably the Consumer Financial Protection Bureau, intended to crack down on the misselling of financial products, was created within the Treasury and then spun off as a separate agency, swelling the numbers of both arrivals and departures.
But some close to the Treasury say the turnover has made it hard to create consistency, and that there are relatively few seasoned professionals dealing with an economy that is still shaky.
A congressional aide who deals with the department regularly said the depth of experience has declined: “It’s absolutely stunning. You go over there and I feel old. There’s not a lot of separate and independent intellectual thought.”
One former senior official under Mr Geithner concurs: “My subjective experience was that there were large numbers of relatively young and not that experienced people – a lot of them refugees from Wall Street.”
The Treasury was a problem from the start, with the administration failing to fill crucial positions, partly because Republicans in the Senate were holding up confirmations of Mr Obama’s nominees. Paul Volcker, the former Federal Reserve chairman, went to Congress in February 2009 to call the gaps “shameful”. He added that the Treasury had already been “weakened” in recent years. “It deserves some attention and rebuilding and new strength,” he said. “You can’t be the leading economic power in the world with all the problems we have and have a weak Treasury.”
Following Mr Volcker’s comments, the department did fill many of the gaps – only for new ones to emerge. But it has made concrete achievements: it produced aggressive programmes with the Fed that stemmed financial panic; it drew up sweeping reforms of Wall Street that became the Dodd-Frank act; and it audaciously bankrupted and rebuilt General Motors and Chrysler.
On the negative side of the ledger, its efforts to kick life into the housing market have fallen flat. There is also debate about the department’s success in implementing those financial reforms, which have created new offices with sweeping power over the nation’s financial institutions.
. . .
Some of the turnover is not unique to the current Treasury but rather a function of the US political system, which another of the leavers compares unfavourably with both the UK Treasury and the Fed. “There is a significant structural difference in the US and the UK – primarily, the US has a much larger layer of politicals,” he says. “I think it’s a flawed system, having seen the way things work at the Fed, which is much more like the HM Treasury in [the UK, with its much smaller] number of political appointees.”
At its best, though, the US system brings advantages. In 2009, there was a host of talented individuals wanting to join the Treasury.
“It sounds sort of cheesy or melodramatic or whatever,” says Brian Osias, who worked on the bail-out and restructuring of GM and Chrysler while at the department, “but to me it was exactly what I hoped. Private sector folks with experiences that could be useful to the government and are not permanent skills that the government needs ... it was great way to deliver that and at the same time to have this public service opportunity.” Mr Osias has left the Treasury and moved with two other former officials to Oskie Capital, a hedge fund.
Sadiq Malik, who made the same move, speaks for many when he says his Treasury stint was satisfying but gruelling. “We were trying to do a business plan for GM, which meant we’d spend two days a week in Detroit. The only sleep you’d get would be maybe a couple of hours on the plane. Then we would spend two days in DC, then two days in New York. You really had seven days a week covered in three different cities. I slept under my desk a couple of times because I just didn’t have time to go home.”
The Oskie group is one of a number of clusters of people who moved together from the public to the private sector. According to an analysis of the data obtained from the Treasury, one of the biggest of those groups is now at Ernst & Young. The accountancy firm has built its Washington tax practice around Michael Mundaca, formerly the most senior tax official in the Obama administration, and Eric Solomon, the most senior tax official in the Bush administration, along with at least four other senior officials.
. . .
Today, among the senior ranks, the revolving door between the Treasury and Ernst & Young is more frequently used than the one between the department and Goldman Sachs – the most famous relationship between finance and politics of recent years. Goldman gave the government Mr Paulson, its CEO, and another senior banker, Mark Patterson, who became Mr Geithner’s chief of staff and now manages the bewildering array of departures and arrivals.
The connection with Goldman – which, through regulatory and congressional investigations, drew more unwanted attention after the crisis than any other – is not extinguished, however. Not only is the bank in discussions with Mr Siewer, the former Treasury official; the traffic runs both ways. In an appointment that largely escaped public attention, the Treasury last year hired Tim Bowler, a Goldman managing director, to work in its capital markets division on reforms such as the ban on proprietary trading, which is causing headaches at his old firm.
Other high-ranking lieutenants have also left, some for big private sector financial roles, raising questions about the ranks of talent that remain. “I look at the people who I thought were really smart and really accomplished during the time I was there – they are all gone,” says another former official. “And I don’t see them replaced by comparable people.” Mr Wolin counters: “This current team is the strongest I’ve seen. Anybody who suggests otherwise simply doesn’t know Treasury or the depth of our talent.”
Jeffrey Goldstein, who was in charge of financial regulation, has returned to his old employer, Hellman & Friedman, the private equity firm. HSBC, the UK-based bank under investigation by US authorities for alleged money laundering offences, has hired as general counsel Stuart Levey, who until last year ran the Treasury’s anti-terrorist finance division.
The Treasury notes that many senior officials, such as Mr Wolin, are still in place. But Mr Geithner’s closest advisers often hold vague and flexible titles such as “counsellor” – and of these many have gone. Lew Alexander has joined Nomura, the Japanese bank; Lee Sachs has set up BancAlliance, a lending platform for community banks; Jim Millstein, a former Lazard banker who led the restructuring of American insurer AIG, has established his own firm, taking a cluster of Treasury colleagues.
Even if the revolving door still exists, the Treasury says it is less damaging than in the past. “This president and this administration have – more than anybody before – put in place rules to make sure that people who leave don’t take advantage of their service in their future work,” says Mr Wolin.
For all the departures, there is one constant: Mr Geithner himself. The Treasury secretary survived a barrage of calls for his head in the first two years, gradually closing the gap between the confident and laconic private persona and his initially lightweight public image.
However, he has stayed this long only at the urging of the president, according to people close to him. Even if Mr Obama wins a second term, his Treasury secretary is likely finally to join the exodus.
.......................................................................
The firm that takes the US Treasury’s brightest from public to private sector
Cypress Advisory opened its door for business in 2005 with one clear aim: to operate at the “revolving door” between bright US Treasury officials looking to move into the private sector and clients in the financial services industry looking to hire top talent.
“We are the only firm, I think in the world, that has people who worked directly for the last four Treasury Secretaries,” says Damon Munchus, one of three members of Cypress’ 13 strong team to have joined from the Obama-era Treasury. “We know where to go, and who to see.”
The financial crisis and the resulting growth in regulation have provided fertile ground for Cypress’ combination of contacts on Capitol Hill and economic analysis. The Washington-based company has doubled in size since 2008, according to Patrick Cave, a former assistant secretary for financial institutions who left the Treasury to work for a lobbying firm, before setting up Cypress.
A third of revenue now comes from hedge funds. Cypress provides investment managers with individual political research, which they use to make investment decisions.
“We make a point of not doing written research,” Mr Cave says, “most of our research is communicated orally over the phone, or in discrete emails to select clients.”
When Treasury was stress testing US banks in 2009, Cypress used its network of contacts, to gather intelligence on possible outcomes. Hedge fund clients increased exposure to financial stocks, after Cypress correctly advised that the stress test results would provide a kick to bank share prices.
“We never asked anyone at the Federal Reserve what the results would be, but having worked in government, we had a view that the stress tests could not prove, and would not prove that the banking sector was unsound,” explains Mr Cave. “The view in the markets was that Fed would run stress tests, and let the chips fall where they may. We felt that was a fundamentally inaccurate view.”
Hedge funds are now focused on developments at Fannie Mae and Freddie Mac, as the Treasury grapples with how the government-run housing agencies will dispose of the inventory of foreclosed homes they have accrued during the crisis. Cypress hedge fund clients are planning dedicated funds to invest in the properties once sales begin, according to Mr Cave. Private equity clients are eyeing up service companies that chase up payments on delinquent mortgages, in anticipation of a surge in business. Foreign central banks that hold Fannie and Freddie debt are also now paying for advice on developments in Congress.
Copyright The Financial Times Limited 2012
'Shoe-bomber' to be released on opening day of Olympics
The notorious terrorist who plotted a shoe-bomb attack on a plane is to be freed from jail just hours before the Olympic Games begin.
Saajid Badat's release will only add to security fears at the high-profile event in London, which opens on July 27.
The 32-year-old was jailed for 13 years in 2005 after conspiring with two other radical Muslims to blow up a passenger jet - but he will be released after serving just eight years and eight months.
Article continues
Saajid Badat's release will only add to security fears at the high-profile event in London, which opens on July 27.
The 32-year-old was jailed for 13 years in 2005 after conspiring with two other radical Muslims to blow up a passenger jet - but he will be released after serving just eight years and eight months.
Article continues
Libyan militia accused of torturing to death ambassador
One of Libya's many new militias has been accused of detaining and apparently torturing to death a former ambassador to France, the latest allegation of brutality to mar the victorious revolutionaries' reputation since the fall of Col Muammar Gaddafi. MORE HERE
Clint Eastwood ad wrong; U.S. taxpayers lost $1.3 billion on Chrysler bailout
NEW YORK (CNNMoney) -- U.S. taxpayers likely lost $1.3 billion in the government bailout of Chrysler, the Treasury Department announced Thursday.
The government recently sold its remaining 6% stake in the company to Italian automaker Fiat. It wrapped up the 2009 bailout that was part of the Troubled Asset Relief Program six years early.
Continue Reading
The government recently sold its remaining 6% stake in the company to Italian automaker Fiat. It wrapped up the 2009 bailout that was part of the Troubled Asset Relief Program six years early.
Continue Reading
Monday, February 6, 2012
Romney turns guns on Santorum
Hot Air:
Generally speaking, political campaigns don’t waste time or effort attacking competitors who pose no threat to their standing. The Mitt Romney campaign has mostly focused on Newt Gingrich for its attacks, which made sense in December and January, as Gingrich had the poll standing and the cash to pose a serious threat — a threat fulfilled in South Carolina. Now, however, the Romney campaign has a new target:
The campaign has sent out three press releases attacking the former Pennsylvania senator in the past 24 hours — and is trotting out lead-surrogate former Minnesota Gov. Tim Pawlenty to attack Santorum in a conference call this afternoon.
“Rick Santorum is a nice guy, but he is simply not ready to be President,” Pawlenty said in a statement released by the Romney campaign. Pawlenty also attacked Santorum for his record as “pork-barrel spender” who is not as conservative as he presents himself to be.
The new focus is a response to Santorum’s strong position leading up to Tuesday’s Minnesota caucus, leading Romney 29% to 27% in a Saturday poll by the Democrat-leaning Public Policy Polling.
Additionally, Santorum has been the only candidate who seems capable of tripping up the usually-unflappable Romney. In the two Florida debates, Santorum drew blood with attacks on the Massachusetts health care law Romney championed. The Romney campaign issued a separate list of Santorum’s “false attacks” on Romney’s signature legislative achievement in the Bay State.
As it happens, pork-barrel spending is one of the issues on which I disagree with Santorum, DADT being another. Santorum has defended the practice in general in the same way that Ron Paul defends it, which is to highlight spending authorizations as a Congressional responsibility, and one that is in theory more accountable than allowing executive-branch agencies to make those decisions. In theory, Santorum and Paul are correct. In practice, however, Congress has had very little transparency on earmarks until very recently, and they ended up mostly being used to flex their muscles in home districts in order to boost their advantage as incumbents. That has allowed a culture of corruption to flood Washington from both Republicans and Democrats alike, and Congressional reforms to the process have been halting and half-hearted at best.
That specific attack line indicates that Romney has begun to see Santorum as an increasing threat. Nate Silver agrees, to a point:
A contiguous block of eight swing states containing 95 electoral votes — Indiana, Iowa, Michigan, Missouri, Minnesota, Ohio, Pennsylvania and Wisconsin — determine the winners and losers in most presidential elections. When at least six or seven of these states are added to the state bases of the Democratic or Republican candidate, he or she is all but guaranteed a victory. (Barack Obama won seven of them in 2008). Only when they are about evenly divided, as in 2000 or 2004, do swing states in other parts of the country — like Nevada or New Hampshire or Florida — tend to make much difference.
Mr. Romney lost Iowa to Rick Santorum, albeit by about the narrowest possible margin. He will have two more opportunities to win a Midwestern state on Tuesday, when Minnesota has its caucuses and Missouri holds a primary. (The Missouri primary does not matter for delegate selection: the state will hold a separate caucus for that purpose in March.)
Mr. Romney could be vulnerable in both states. A survey released on Sunday by Public Policy Polling, which has had fairly accurate results so far in the primary season, had Minnesota as a toss-up between Mr. Romney and Mr. Santorum, with Newt Gingrich and Ron Paul not far behind.
And in Missouri, where Mr. Gingrich is not on the ballot for the “beauty contest” primary, it had Mr. Santorum ahead of Mr. Romney, 45 percent to 34 percent.
Imagine that Mr. Romney were to lose both states. That would make him zero for three in the nation’s most important swing region. It would raise questions about his performance in Ohio, probably the most important state to vote on “Super Tuesday,” March 6. Polling there also shows a competitive race.
If Romney loses both, he would still have not lost any delegates. None of the contests before Arizona this month produce delegate allocations except Nevada; they’re all non-binding. But it would raise questions about Romney’s ability to connect in “flyover country,” and would highlight Santorum’s ability to play in the Midwest.
Bill Kristol believes a Santorum-Romney fight would produce a more “serious and constructive” battle in the GOP primaries:
In Minnesota and Colorado, the caucus system will result in a proportional allocation of delegates among the various candidates. But with polling showing Santorum even with Romney in Minnesota and second to Romney in Colorado, a strong showing for Santorum would do the most to slow the Romney juggernaut. It would also of course help Santorum’s chances to replace Gingrich down the road as the alternative to Romney—an outcome that, I suspect, might well result in a better race for the nomination and a healthier situation for the ultimate Republican nominee.
A final point: vote. The Romney-Gingrich slugfest of negativity seems to have produced a low turnout in Florida and Nevada. But the choice before you remains no less important than it was before all the negative ads started airing. Indeed, you who will vote tomorrow have a chance to get us beyond the unseemly spectacle of the last couple of weeks. You can put Romney on a likely path to the nomination. Or you can create the possibility of a serious and constructive Romney vs. Santorum race.
Obviously, I agree with this assessment. Given the new focus on Santorum, it looks as though Team Romney now sees Santorum as a considerable threat. We’ll see how Santorum responds, but he’s been undaunted by all of the twists and turns so far.
Generally speaking, political campaigns don’t waste time or effort attacking competitors who pose no threat to their standing. The Mitt Romney campaign has mostly focused on Newt Gingrich for its attacks, which made sense in December and January, as Gingrich had the poll standing and the cash to pose a serious threat — a threat fulfilled in South Carolina. Now, however, the Romney campaign has a new target:
The campaign has sent out three press releases attacking the former Pennsylvania senator in the past 24 hours — and is trotting out lead-surrogate former Minnesota Gov. Tim Pawlenty to attack Santorum in a conference call this afternoon.
“Rick Santorum is a nice guy, but he is simply not ready to be President,” Pawlenty said in a statement released by the Romney campaign. Pawlenty also attacked Santorum for his record as “pork-barrel spender” who is not as conservative as he presents himself to be.
The new focus is a response to Santorum’s strong position leading up to Tuesday’s Minnesota caucus, leading Romney 29% to 27% in a Saturday poll by the Democrat-leaning Public Policy Polling.
Additionally, Santorum has been the only candidate who seems capable of tripping up the usually-unflappable Romney. In the two Florida debates, Santorum drew blood with attacks on the Massachusetts health care law Romney championed. The Romney campaign issued a separate list of Santorum’s “false attacks” on Romney’s signature legislative achievement in the Bay State.
As it happens, pork-barrel spending is one of the issues on which I disagree with Santorum, DADT being another. Santorum has defended the practice in general in the same way that Ron Paul defends it, which is to highlight spending authorizations as a Congressional responsibility, and one that is in theory more accountable than allowing executive-branch agencies to make those decisions. In theory, Santorum and Paul are correct. In practice, however, Congress has had very little transparency on earmarks until very recently, and they ended up mostly being used to flex their muscles in home districts in order to boost their advantage as incumbents. That has allowed a culture of corruption to flood Washington from both Republicans and Democrats alike, and Congressional reforms to the process have been halting and half-hearted at best.
That specific attack line indicates that Romney has begun to see Santorum as an increasing threat. Nate Silver agrees, to a point:
A contiguous block of eight swing states containing 95 electoral votes — Indiana, Iowa, Michigan, Missouri, Minnesota, Ohio, Pennsylvania and Wisconsin — determine the winners and losers in most presidential elections. When at least six or seven of these states are added to the state bases of the Democratic or Republican candidate, he or she is all but guaranteed a victory. (Barack Obama won seven of them in 2008). Only when they are about evenly divided, as in 2000 or 2004, do swing states in other parts of the country — like Nevada or New Hampshire or Florida — tend to make much difference.
Mr. Romney lost Iowa to Rick Santorum, albeit by about the narrowest possible margin. He will have two more opportunities to win a Midwestern state on Tuesday, when Minnesota has its caucuses and Missouri holds a primary. (The Missouri primary does not matter for delegate selection: the state will hold a separate caucus for that purpose in March.)
Mr. Romney could be vulnerable in both states. A survey released on Sunday by Public Policy Polling, which has had fairly accurate results so far in the primary season, had Minnesota as a toss-up between Mr. Romney and Mr. Santorum, with Newt Gingrich and Ron Paul not far behind.
And in Missouri, where Mr. Gingrich is not on the ballot for the “beauty contest” primary, it had Mr. Santorum ahead of Mr. Romney, 45 percent to 34 percent.
Imagine that Mr. Romney were to lose both states. That would make him zero for three in the nation’s most important swing region. It would raise questions about his performance in Ohio, probably the most important state to vote on “Super Tuesday,” March 6. Polling there also shows a competitive race.
If Romney loses both, he would still have not lost any delegates. None of the contests before Arizona this month produce delegate allocations except Nevada; they’re all non-binding. But it would raise questions about Romney’s ability to connect in “flyover country,” and would highlight Santorum’s ability to play in the Midwest.
Bill Kristol believes a Santorum-Romney fight would produce a more “serious and constructive” battle in the GOP primaries:
In Minnesota and Colorado, the caucus system will result in a proportional allocation of delegates among the various candidates. But with polling showing Santorum even with Romney in Minnesota and second to Romney in Colorado, a strong showing for Santorum would do the most to slow the Romney juggernaut. It would also of course help Santorum’s chances to replace Gingrich down the road as the alternative to Romney—an outcome that, I suspect, might well result in a better race for the nomination and a healthier situation for the ultimate Republican nominee.
A final point: vote. The Romney-Gingrich slugfest of negativity seems to have produced a low turnout in Florida and Nevada. But the choice before you remains no less important than it was before all the negative ads started airing. Indeed, you who will vote tomorrow have a chance to get us beyond the unseemly spectacle of the last couple of weeks. You can put Romney on a likely path to the nomination. Or you can create the possibility of a serious and constructive Romney vs. Santorum race.
Obviously, I agree with this assessment. Given the new focus on Santorum, it looks as though Team Romney now sees Santorum as a considerable threat. We’ll see how Santorum responds, but he’s been undaunted by all of the twists and turns so far.
Romney vs. Santorum?
Weekly Standard:
To the Republicans of the states of Missouri, Minnesota, and Colorado:
This is your moment to vote on a subject that speaks its own importance—who will be the 2012 Republican presidential nominee, the man (if I may quote myself!) “who will save us from the ghastly prospect of an Obama second term, and who will then have the task of beginning to put right our listing ship of state, setting our nation on a course to restored solvency, reinvigorated liberty, and renewed greatness.”
The voters of Iowa and New Hampshire winnowed the field down to four. The voters of South Carolina kept Newt Gingrich alive. The voters of Florida and Nevada reestablished Mitt Romney as the clear frontrunner. Now the race moves (back) to the Midwest.
Obviously, as you make your selection tomorrow, your main consideration must be who you think would be the best president of the United States. But you might also keep this in mind:
If Mitt Romney wins all three contests tomorrow, it's not the end of the race—but it might be the beginning of the end. Winning three out of five (the current situation) is good for a candidate; winning six out of eight is commanding. Are you convinced of the case for Romney? If so, vote for Mitt.
Ron Paul trails in polling in all three states. Those who are inclined to support him are perhaps more interested in Paul accumulating delegates (in Minnesota and Colorado) or in sending a message (in Missouri) than in anything else. But if you think it's in Paul's interest to keep the race alive, you might consider a tactical vote for the leading non-Romney alternative.
Who is . . . Rick Santorum. Gingrich isn't on the ballot in the Missouri “beauty contest” primary, and Paul trails badly. Missouri is pretty much a one-on-one match between Romney and Santorum. A Santorum victory would slow Romney's momentum—and would certainly give Santorum a boost—going forward.
In Minnesota and Colorado, the caucus system will result in a proportional allocation of delegates among the various candidates. But with polling showing Santorum even with Romney in Minnesota and second to Romney in Colorado, a strong showing for Santorum would do the most to slow the Romney juggernaut. It would also of course help Santorum's chances to replace Gingrich down the road as the alternative to Romney—an outcome that, I suspect, might well result in a better race for the nomination and a healthier situation for the ultimate Republican nominee.
A final point: vote. The Romney-Gingrich slugfest of negativity seems to have produced a low turnout in Florida and Nevada. But the choice before you remains no less important than it was before all the negative ads started airing. Indeed, you who will vote tomorrow have a chance to get us beyond the unseemly spectacle of the last couple of weeks. You can put Romney on a likely path to the nomination. Or you can create the possibility of a serious and constructive Romney vs. Santorum race.
To the Republicans of the states of Missouri, Minnesota, and Colorado:
This is your moment to vote on a subject that speaks its own importance—who will be the 2012 Republican presidential nominee, the man (if I may quote myself!) “who will save us from the ghastly prospect of an Obama second term, and who will then have the task of beginning to put right our listing ship of state, setting our nation on a course to restored solvency, reinvigorated liberty, and renewed greatness.”
The voters of Iowa and New Hampshire winnowed the field down to four. The voters of South Carolina kept Newt Gingrich alive. The voters of Florida and Nevada reestablished Mitt Romney as the clear frontrunner. Now the race moves (back) to the Midwest.
Obviously, as you make your selection tomorrow, your main consideration must be who you think would be the best president of the United States. But you might also keep this in mind:
If Mitt Romney wins all three contests tomorrow, it's not the end of the race—but it might be the beginning of the end. Winning three out of five (the current situation) is good for a candidate; winning six out of eight is commanding. Are you convinced of the case for Romney? If so, vote for Mitt.
Ron Paul trails in polling in all three states. Those who are inclined to support him are perhaps more interested in Paul accumulating delegates (in Minnesota and Colorado) or in sending a message (in Missouri) than in anything else. But if you think it's in Paul's interest to keep the race alive, you might consider a tactical vote for the leading non-Romney alternative.
Who is . . . Rick Santorum. Gingrich isn't on the ballot in the Missouri “beauty contest” primary, and Paul trails badly. Missouri is pretty much a one-on-one match between Romney and Santorum. A Santorum victory would slow Romney's momentum—and would certainly give Santorum a boost—going forward.
In Minnesota and Colorado, the caucus system will result in a proportional allocation of delegates among the various candidates. But with polling showing Santorum even with Romney in Minnesota and second to Romney in Colorado, a strong showing for Santorum would do the most to slow the Romney juggernaut. It would also of course help Santorum's chances to replace Gingrich down the road as the alternative to Romney—an outcome that, I suspect, might well result in a better race for the nomination and a healthier situation for the ultimate Republican nominee.
A final point: vote. The Romney-Gingrich slugfest of negativity seems to have produced a low turnout in Florida and Nevada. But the choice before you remains no less important than it was before all the negative ads started airing. Indeed, you who will vote tomorrow have a chance to get us beyond the unseemly spectacle of the last couple of weeks. You can put Romney on a likely path to the nomination. Or you can create the possibility of a serious and constructive Romney vs. Santorum race.
Ed Morrissey: My choice - Rick Santorum
Hot Air:
As I wrote earlier, decision time has come to Minnesota, where I live. Unfortunately, I can’t officially participate in that choice, since we have a caucus system rather than a primary — and one cannot cast an absentee vote in a caucus system. I checked twice with my BPOU officials (a BPOU is a “basic political organization unit,” akin to a precinct) and there is no provision for proxy voting. I will be in Washington DC for CPAC and some company meetings when the caucuses take place on Tuesday evening.
Very early in the process, I promised Hot Air readers that I would disclose my choice for President in the primaries when I had fully made up my mind. Just as I did four years ago, I didn’t fully make up my mind until shortly before the caucus. Last time I caucused for Romney; this time, if I had the opportunity, I would caucus for Rick Santorum.
Before I explain that decision, let’s be clear. I could cast a vote happily for Mitt Romney or Newt Gingrich in a general election. Both are massive improvements over the current incumbent, and both have admirable qualities that would reflect well on the GOP once in office — even if those admirable qualities aren’t always on display now. I will enthusiastically support any of those three men should they win the nomination. My focus will be on beating Barack Obama and promoting the conservative agenda, in that order, throughout 2012, and I also believe that any of those three could beat Obama in a general election campaign.
Why Santorum? In my estimation, Santorum is the last consistent conservative standing, and the only one both promoting the conservative agenda and campaigning as a conservative in the race. That doesn’t make Santorum perfect; he lacks the executive experience I’d like to see, and some of his positions in the past and present give me pause. However, compared to the heterodoxies of his competitors in the GOP race, Santorum has a superior record on promoting conservative policies and values.
Even more than that, though, Santorum has demonstrated a level of personal integrity in this race that outshines the rest of the field. Santorum has campaigned with blue-collar Reagan Democrats in mind, pushing for an economic plan that would revitalize manufacturing and small business. He could easily have tipped over into class-warfare populism while Gingrich and Romney bashed each other over their work at Bain and Freddie Mac in order to ingratiate himself with that sector by playing on latent envy. Instead, he defended capitalism and both of his competitors on the campaign trail more effectively than either could defend themselves. In contrast, Romney keeps demonstrating a lack of fluency in conservative politics and philosophy, while Gingrich has conducted a personal, angry campaign that threatens to reinforce every negative stereotype about conservatives, both at times putting themselves and their ambitions above the party they seek to lead.
In the general election, I want to beat Barack Obama and send him into a prosperous retirement with his family. In the primary, I want a party leader who demonstrates the kind of integrity and consistency that only Santorum has shown. He worked hard for my vote, and I only wish I could be in the state to cast it on Tuesday.
As I wrote earlier, decision time has come to Minnesota, where I live. Unfortunately, I can’t officially participate in that choice, since we have a caucus system rather than a primary — and one cannot cast an absentee vote in a caucus system. I checked twice with my BPOU officials (a BPOU is a “basic political organization unit,” akin to a precinct) and there is no provision for proxy voting. I will be in Washington DC for CPAC and some company meetings when the caucuses take place on Tuesday evening.
Very early in the process, I promised Hot Air readers that I would disclose my choice for President in the primaries when I had fully made up my mind. Just as I did four years ago, I didn’t fully make up my mind until shortly before the caucus. Last time I caucused for Romney; this time, if I had the opportunity, I would caucus for Rick Santorum.
Before I explain that decision, let’s be clear. I could cast a vote happily for Mitt Romney or Newt Gingrich in a general election. Both are massive improvements over the current incumbent, and both have admirable qualities that would reflect well on the GOP once in office — even if those admirable qualities aren’t always on display now. I will enthusiastically support any of those three men should they win the nomination. My focus will be on beating Barack Obama and promoting the conservative agenda, in that order, throughout 2012, and I also believe that any of those three could beat Obama in a general election campaign.
Why Santorum? In my estimation, Santorum is the last consistent conservative standing, and the only one both promoting the conservative agenda and campaigning as a conservative in the race. That doesn’t make Santorum perfect; he lacks the executive experience I’d like to see, and some of his positions in the past and present give me pause. However, compared to the heterodoxies of his competitors in the GOP race, Santorum has a superior record on promoting conservative policies and values.
Even more than that, though, Santorum has demonstrated a level of personal integrity in this race that outshines the rest of the field. Santorum has campaigned with blue-collar Reagan Democrats in mind, pushing for an economic plan that would revitalize manufacturing and small business. He could easily have tipped over into class-warfare populism while Gingrich and Romney bashed each other over their work at Bain and Freddie Mac in order to ingratiate himself with that sector by playing on latent envy. Instead, he defended capitalism and both of his competitors on the campaign trail more effectively than either could defend themselves. In contrast, Romney keeps demonstrating a lack of fluency in conservative politics and philosophy, while Gingrich has conducted a personal, angry campaign that threatens to reinforce every negative stereotype about conservatives, both at times putting themselves and their ambitions above the party they seek to lead.
In the general election, I want to beat Barack Obama and send him into a prosperous retirement with his family. In the primary, I want a party leader who demonstrates the kind of integrity and consistency that only Santorum has shown. He worked hard for my vote, and I only wish I could be in the state to cast it on Tuesday.
Santorum’s got game
Michelle Malkin:
Some GOP 2012 news you might have missed over Super Bowl weekend, via the Rick Santorum campaign:
Polls have provided empirical data to this trend in the key battleground states of Minnesota and Colorado, where Rick Santorum has emerged as the clear conservative alternative to moderate Mitt Romney.
Public Policy Polling
Minnesota:
Santorum: 29%
Romney: 27%
Gingrich: 22%
Colorado:
Romney: 40%
Santorum: 26%
Gingrich: 18%
Nationally, Rick Santorum is the only Republican contender to beat President Barack Obama head-to-head.
Rasmussen Reports Poll
General Election Match-Ups:
Santorum: 45%
Obama: 44%
Romney: 43%
Obama: 47%
Gingrich: 41%
Obama: 49%
And just as important as the General Election horserace is, Rick Santorum is proving to be the most popular and likeable Republican candidate for President – a key ingredient to winning not just elections, but the hearts and minds of voters. (Public Policy Polling)
The conventional wisdom tells us Mitt and Newt are the only choices in this race. But these most recent polls clearly suggest that Santorum, not Newt, is the strongest conservative alternative. I’ve carefully and candidly laid out the strengths, weaknesses, and best arguments for Santorum. I’m working in my home state of Colorado to spread the message. Ed Morrissey makes his case for Santorum to his fellow Minnesotans and the Right at Hot Air. David Limbaugh did last week. More support from the Right spotlighted here by Stacy McCain.
Is it a long shot? Yes. Is it doable? Yes. There are no inevitabilities in politics.
Santorum’s got game. Strong showings in Missouri, Minnesota, and Colorado could bring the fundraising boost he needs. You can help right now right here.
***
A reminder of the Romn-Obama twins:
The Fishwrap of Record is catching on:
Mr. Santorum is, in many ways, a more dangerous opponent for Mr. Romney than Mr. Gingrich at this point. He has run a more disciplined campaign than the former House speaker, has less personal baggage and is less disliked by party leaders.
Mr. Santorum can also make a credible claim to challenging Mr. Romney on electability. Mr. Santorum’s current unfavorable rating among all voters is 11 points lower than Mr. Romney’s, 36 percent versus 47 percent. Their favorable ratings are roughly equal: 30 percent for Mr. Santorum to 29 percent for Mr. Romney.
Mr. Santorum’s conservative positions on social issues might not make him an ideal fit with certain types of independent voters. States that are moderate to -liberal on social policy, like Virginia, New Hampshire, Nevada and Colorado, could be tougher for Republicans to win if Mr. Santorum is their nominee.
But those concerns might be outweighed if Mr. Santorum shows strength in the Midwest — and Mr. Romney shows weakness.
…With Mr. Santorum, however, you can at least draw up a coherent path to victory, one that runs through the Midwest. There is a Midwestern state left to vote at virtually every turn of the nomination calendar. After Michigan on Feb. 28 and Ohio on Super Tuesday comes Missouri (again) on March 17, when it holds its caucuses, then Illinois on March 20, Wisconsin on April 3 and Pennsylvania on April 24. (A big disadvantage for Mr. Santorum: He did not qualify for the ballot in Indiana, which votes on May 8.)
Mr. Santorum would eventually need to expand his coalition beyond the region — such as to the socially conservative states of the South. But victories for him in Minnesota or Missouri — especially if he wins both — would at once raise new concerns about Mr. Romney’s appeal to working-class voters and make Mr. Gingrich’s victory in South Carolina appear to be a one-off event that is quickly receding in the rear-view mirror.
Some GOP 2012 news you might have missed over Super Bowl weekend, via the Rick Santorum campaign:
Polls have provided empirical data to this trend in the key battleground states of Minnesota and Colorado, where Rick Santorum has emerged as the clear conservative alternative to moderate Mitt Romney.
Public Policy Polling
Minnesota:
Santorum: 29%
Romney: 27%
Gingrich: 22%
Colorado:
Romney: 40%
Santorum: 26%
Gingrich: 18%
Nationally, Rick Santorum is the only Republican contender to beat President Barack Obama head-to-head.
Rasmussen Reports Poll
General Election Match-Ups:
Santorum: 45%
Obama: 44%
Romney: 43%
Obama: 47%
Gingrich: 41%
Obama: 49%
And just as important as the General Election horserace is, Rick Santorum is proving to be the most popular and likeable Republican candidate for President – a key ingredient to winning not just elections, but the hearts and minds of voters. (Public Policy Polling)
The conventional wisdom tells us Mitt and Newt are the only choices in this race. But these most recent polls clearly suggest that Santorum, not Newt, is the strongest conservative alternative. I’ve carefully and candidly laid out the strengths, weaknesses, and best arguments for Santorum. I’m working in my home state of Colorado to spread the message. Ed Morrissey makes his case for Santorum to his fellow Minnesotans and the Right at Hot Air. David Limbaugh did last week. More support from the Right spotlighted here by Stacy McCain.
Is it a long shot? Yes. Is it doable? Yes. There are no inevitabilities in politics.
Santorum’s got game. Strong showings in Missouri, Minnesota, and Colorado could bring the fundraising boost he needs. You can help right now right here.
***
A reminder of the Romn-Obama twins:
The Fishwrap of Record is catching on:
Mr. Santorum is, in many ways, a more dangerous opponent for Mr. Romney than Mr. Gingrich at this point. He has run a more disciplined campaign than the former House speaker, has less personal baggage and is less disliked by party leaders.
Mr. Santorum can also make a credible claim to challenging Mr. Romney on electability. Mr. Santorum’s current unfavorable rating among all voters is 11 points lower than Mr. Romney’s, 36 percent versus 47 percent. Their favorable ratings are roughly equal: 30 percent for Mr. Santorum to 29 percent for Mr. Romney.
Mr. Santorum’s conservative positions on social issues might not make him an ideal fit with certain types of independent voters. States that are moderate to -liberal on social policy, like Virginia, New Hampshire, Nevada and Colorado, could be tougher for Republicans to win if Mr. Santorum is their nominee.
But those concerns might be outweighed if Mr. Santorum shows strength in the Midwest — and Mr. Romney shows weakness.
…With Mr. Santorum, however, you can at least draw up a coherent path to victory, one that runs through the Midwest. There is a Midwestern state left to vote at virtually every turn of the nomination calendar. After Michigan on Feb. 28 and Ohio on Super Tuesday comes Missouri (again) on March 17, when it holds its caucuses, then Illinois on March 20, Wisconsin on April 3 and Pennsylvania on April 24. (A big disadvantage for Mr. Santorum: He did not qualify for the ballot in Indiana, which votes on May 8.)
Mr. Santorum would eventually need to expand his coalition beyond the region — such as to the socially conservative states of the South. But victories for him in Minnesota or Missouri — especially if he wins both — would at once raise new concerns about Mr. Romney’s appeal to working-class voters and make Mr. Gingrich’s victory in South Carolina appear to be a one-off event that is quickly receding in the rear-view mirror.
One Year Later, Another Look at Obamanomics vs. Reaganomics
International Liberty:
February 2, 2012 by Dan Mitchell
On this day last year, I posted two charts that I developed using the Minneapolis Federal Reserve Bank’s interactive website.
Those two charts showed that the current recovery was very weak compared to the boom of the early 1980s.
But perhaps that was an unfair comparison. Maybe the Reagan recovery started strong and then hit a wall. Or maybe the Obama recovery was the economic equivalent of a late bloomer.
So let’s look at the same charts, but add an extra year of data. Does it make a difference?
Meh…not so much.
Let’s start with the GDP data. The comparison is striking. Under Reagan’s policies, the economy skyrocketed. Heck, the chart prepared by the Minneapolis Fed doesn’t even go high enough to show how well the economy performed during the 1980s.
Under Obama’s policies, by contrast, we’ve just barely gotten back to where we were when the recession began. Unlike past recessions, we haven’t enjoyed a strong bounce. And this means we haven’t recovered the output that was lost during the downturn.
This is a damning indictment of Obamanomics
Indeed, I made this point several months ago when analyzing some work by Nobel laureate Robert Lucas. And it’s been highlighted more recently by James Pethokoukis of the American Enterprise Institute and the news pages of the Wall Street Journal.
Unfortunately, the jobs chart is probably even more discouraging. As you can see, employment is still far below where it started.
This is in stark contrast to the jobs boom during the Reagan years.
So what does this mean? How do we measure the human cost of the foregone growth and jobs that haven’t been created?
Writing in today’s Wall Street Journal, former Senator Phil Gramm and budgetary expert Mike Solon compare the current recovery to the post-war average as well as to what happened under Reagan.
If in this “recovery” our economy had grown and generated jobs at the average rate achieved following the 10 previous postwar recessions, GDP per person would be $4,528 higher and 13.7 million more Americans would be working today. …President Ronald Reagan’s policies ignited a recovery so powerful that if it were being repeated today, real per capita GDP would be $5,694 higher than it is now—an extra $22,776 for a family of four. Some 16.9 million more Americans would have jobs.
By the way, the Gramm-Solon column also addresses the argument that this recovery is anemic because the downturn was caused by a financial crisis. That’s certainly a reasonable argument, but they point out that Reagan had to deal with the damage caused by high inflation, which certainly wreaked havoc with parts of the financial system. They also compare today’s weak recovery to the boom that followed the financial crisis of 1907.
But I want to make a different point. As I’ve written before, Obama is not responsible for the current downturn. Yes, he was a Senator and he was part of the bipartisan consensus for easy money, Fannie/Freddie subsidies, bailout-fueled moral hazard, and a playing field tilted in favor of debt, but his share of the blame wouldn’t even merit an asterisk.
My problem with Obama is that he hasn’t fixed any of the problems. Instead, he has kept in place all of the bad policies – and in some cases made them worse. Indeed, I challenge anyone to identify a meaningful difference between the economic policy of Obama and the economic policy of Bush.
Bush increased government spending. Obama has been increasing government spending.
Bush adopted Keynesian “stimulus” policies. Obama adopted Keynesian “stimulus” policies.
Bush bailed out politically connected companies. Obama has been bailing out politically connected companies.
Bush supported the Fed’s easy-money policy. Obama has been supporting the Fed’s easy-money policy.
Bush created a new healthcare entitlement. Obama created a new healthcare entitlement.
Bush imposed costly new regulations on the financial sector. Obama imposed costly new regulations on the financial sector.
I could continue, but you probably get the point. On economic issues, the only real difference is that Bush cut taxes and Obama is in favor of higher taxes. Though even that difference is somewhat overblown since Obama’s tax policies – up to this point – haven’t had a big impact on the overall tax burden (though that could change if his plans for higher tax rates ever go into effect).
This is why I always tell people not to pay attention to party labels. Bigger government doesn’t work, regardless of whether a politician is a Republican or Democrat. The problem isn’t Obamanomics, it’s Bushobamanomics. But since that’s a bit awkward, let’s just call it statism.
February 2, 2012 by Dan Mitchell
On this day last year, I posted two charts that I developed using the Minneapolis Federal Reserve Bank’s interactive website.
Those two charts showed that the current recovery was very weak compared to the boom of the early 1980s.
But perhaps that was an unfair comparison. Maybe the Reagan recovery started strong and then hit a wall. Or maybe the Obama recovery was the economic equivalent of a late bloomer.
So let’s look at the same charts, but add an extra year of data. Does it make a difference?
Let’s start with the GDP data. The comparison is striking. Under Reagan’s policies, the economy skyrocketed. Heck, the chart prepared by the Minneapolis Fed doesn’t even go high enough to show how well the economy performed during the 1980s.
Under Obama’s policies, by contrast, we’ve just barely gotten back to where we were when the recession began. Unlike past recessions, we haven’t enjoyed a strong bounce. And this means we haven’t recovered the output that was lost during the downturn.
This is a damning indictment of Obamanomics
Indeed, I made this point several months ago when analyzing some work by Nobel laureate Robert Lucas. And it’s been highlighted more recently by James Pethokoukis of the American Enterprise Institute and the news pages of the Wall Street Journal.
Unfortunately, the jobs chart is probably even more discouraging. As you can see, employment is still far below where it started.
This is in stark contrast to the jobs boom during the Reagan years.
So what does this mean? How do we measure the human cost of the foregone growth and jobs that haven’t been created?
Writing in today’s Wall Street Journal, former Senator Phil Gramm and budgetary expert Mike Solon compare the current recovery to the post-war average as well as to what happened under Reagan.
If in this “recovery” our economy had grown and generated jobs at the average rate achieved following the 10 previous postwar recessions, GDP per person would be $4,528 higher and 13.7 million more Americans would be working today. …President Ronald Reagan’s policies ignited a recovery so powerful that if it were being repeated today, real per capita GDP would be $5,694 higher than it is now—an extra $22,776 for a family of four. Some 16.9 million more Americans would have jobs.
By the way, the Gramm-Solon column also addresses the argument that this recovery is anemic because the downturn was caused by a financial crisis. That’s certainly a reasonable argument, but they point out that Reagan had to deal with the damage caused by high inflation, which certainly wreaked havoc with parts of the financial system. They also compare today’s weak recovery to the boom that followed the financial crisis of 1907.
But I want to make a different point. As I’ve written before, Obama is not responsible for the current downturn. Yes, he was a Senator and he was part of the bipartisan consensus for easy money, Fannie/Freddie subsidies, bailout-fueled moral hazard, and a playing field tilted in favor of debt, but his share of the blame wouldn’t even merit an asterisk.
My problem with Obama is that he hasn’t fixed any of the problems. Instead, he has kept in place all of the bad policies – and in some cases made them worse. Indeed, I challenge anyone to identify a meaningful difference between the economic policy of Obama and the economic policy of Bush.
Bush increased government spending. Obama has been increasing government spending.
Bush adopted Keynesian “stimulus” policies. Obama adopted Keynesian “stimulus” policies.
Bush bailed out politically connected companies. Obama has been bailing out politically connected companies.
Bush supported the Fed’s easy-money policy. Obama has been supporting the Fed’s easy-money policy.
Bush created a new healthcare entitlement. Obama created a new healthcare entitlement.
Bush imposed costly new regulations on the financial sector. Obama imposed costly new regulations on the financial sector.
I could continue, but you probably get the point. On economic issues, the only real difference is that Bush cut taxes and Obama is in favor of higher taxes. Though even that difference is somewhat overblown since Obama’s tax policies – up to this point – haven’t had a big impact on the overall tax burden (though that could change if his plans for higher tax rates ever go into effect).
This is why I always tell people not to pay attention to party labels. Bigger government doesn’t work, regardless of whether a politician is a Republican or Democrat. The problem isn’t Obamanomics, it’s Bushobamanomics. But since that’s a bit awkward, let’s just call it statism.
West Virginia Sheriff, Clerk Snared in Vote Fraud Investigation
stoptheaclu.com
-By Warner Todd Huston
A Lincoln County, West Virginia Sheriff and Clerk are to plead guilty to charges of vote fraud in the 2010 Democrat primary after the pair were arrested during an election fraud investigation conducted by state and federal authorities.
Sheriff Jerry Bowman and Clerk Donald Whitten were caught in a scheme to file fraudulent absentee ballots in an effort to get Whitten elected Circuit Clerk. Whitten will also plead guilty to lying to an FBI agent hired by WV Secretary of State Natalie Tennant to investigate the false absentee ballots.
Sheriff Bowman, who is at the tail end of a second term and is term-limited from running again, conspired with Whitten and a thus far unidentified candidate for county commissioner to help Whitten win a close election with the fraudulent absentee ballot scheme.
“The Candidates further agreed that they would complete absentee ballot applications for voters,” the agreement documents said. “The Candidates also agreed that on those applications they would state certain reasons that voters were legally eligible to vote absentee, regardless of whether those reasons were true.”
In 2004 several Lincoln and Logan County officials were convicted of vote fraud in a federal vote-buying case. Convicted included Lincoln County Circuit Clerk Greg Stowers and county Assessor Jerry Weaver. Amazingly, Weaver is now running for county sheriff.
But, remember… left-wingers and Democrats say there is no vote fraud in the USA.
-By Warner Todd Huston
A Lincoln County, West Virginia Sheriff and Clerk are to plead guilty to charges of vote fraud in the 2010 Democrat primary after the pair were arrested during an election fraud investigation conducted by state and federal authorities.
Sheriff Jerry Bowman and Clerk Donald Whitten were caught in a scheme to file fraudulent absentee ballots in an effort to get Whitten elected Circuit Clerk. Whitten will also plead guilty to lying to an FBI agent hired by WV Secretary of State Natalie Tennant to investigate the false absentee ballots.
Sheriff Bowman, who is at the tail end of a second term and is term-limited from running again, conspired with Whitten and a thus far unidentified candidate for county commissioner to help Whitten win a close election with the fraudulent absentee ballot scheme.
“The Candidates further agreed that they would complete absentee ballot applications for voters,” the agreement documents said. “The Candidates also agreed that on those applications they would state certain reasons that voters were legally eligible to vote absentee, regardless of whether those reasons were true.”
In 2004 several Lincoln and Logan County officials were convicted of vote fraud in a federal vote-buying case. Convicted included Lincoln County Circuit Clerk Greg Stowers and county Assessor Jerry Weaver. Amazingly, Weaver is now running for county sheriff.
But, remember… left-wingers and Democrats say there is no vote fraud in the USA.
A Tale of Two Republican Parties
Sultan Knish:
There are two Republican parties. One is fairly liberal, it is hostile to the left but it also believes in stealing their thunder by adopting moderate versions of their policies.
This Republican Party is strongly pro-business, but it believes that to succeed in a global economy the government must provide subsidies to businesses and individuals. It believes that immigration reform is needed, though its chosen candidates know to avoid using the word amnesty. It believes that national health care is inevitable and that the only way to avoid a government solution is through the individual mandate.
It is loosely conservative, but disinterested in social issues. It thinks that the left has gone too far in upending traditional values, but has no interested in combating it and finds those who do embarrassing . It adapts to changing mores with an uneasy smile and tries to pretend that it was with it all along. It has no strong religious feelings and it believes that all religious, including Islam, are basically the same.
It is strong on national defense spending, but mainly to maintain stability and national influence, not because it believes that we face any real threats. It believes that America has a responsibility to the rest of the world and that we are obligated to give back through the United Nations and other international organizations allowing us to spread our values of free enterprise and democracy to everyone.
It is a big believer in the American Dream of economic opportunity, but is unable to think of any other national virtues beyond that. It maintains a strongly Federalist legacy and while it agrees that the Federal government has overreached itself in interfering with the business of states, it has no real interest in rolling back its powers, only in making certain that they are used "wisely".
The only area where it actively rolls back the left's program is its deregulation of businesses, but even this is limited to spheres that are objectionable to specific industries which lobby for deregulation. Small businesses can expect much less help, unless they band together and forcefully make something into an issue.
It has no passion for anything beyond deregulating a few specific industries. It supports the right to bear arms, not because it passionately believes in it, but because the political costs of not doing so are too high. It opposes abortion for the same reason, though its opposition is mainly a formality. It believes that gay marriage is inevitable, but isn't willing to pick a fight with its base over it.
Its leaders and members consider themselves rationalists and believe in Global Warming because "the science says so." They sneer at those Republicans who deny what they think is the obvious. While they are skeptical of government solutions to Global Warming, they are prepared to accept an approach that does not cause too much harm to business and is routed through private companies.
It views what the Republican Party has become as an embarrassment and while it doles out red meat to the base when it has to, it despises them and constantly dreams of ways of getting rid of them. In its fondest daydreams, a graduated amnesty program for Mexican immigrants by a Republican president turns them all into legal citizens and Republican voters, allowing them to tell their guns n bibles base to kiss off.
It does not believe that Obama is bad, only inexperienced and misguided, but basically well-meaning and its lack of support for him is not due to a firm belief that his agenda is destructive, but to political calculations and the need to appease their base.
This Party is not particularly worried about the future of the United States except as a place to do business. And even then it will easily move operations offshore to Dubai or Singapore. Overall it is optimistic that things will go on as they have, with a gradual process of reform advanced by the left and moderated by the right in the political process resulting in a workable center.
Then there's the other Republican Party. This party is deeply worried about the future of the country, and not just as a place to do business. It is socially conservative, strong on national defense because it believes that we do face real threats and enemies, it is opposed to amnesty and very skeptical of Federal power.
This party is more new than it is old, it's a party that evolved in response to the transformation of the Democratic Party at the hands of the left. It is the base from which the Republican Party draws much of its support, particularly away from the Northeast, and it is struggling to force the party to match its deeds to its words.
It does not believe that most of the national debates are a tempest in a teacup that can be settled amicably behind closed doors. It is uninterested in bipartisan great compromisers, it seeks fighters who will stand up for its agenda. It is not interested in the progressive voyage to the national future that has been taken up by both parties, what it would like is independence from their reign of policy terror. It would like to roll back the progressive policymaking of both parties.
It is concerned for its ability to earn a living, for the values of its children and the basic freedoms that it can see being lost every day. It remembers a time when people had more freedom and less rules hanging over their heads. The tide of paperwork, the omnipresent regulatory state infuriate it and lead it to vote for people who claim to want Washington off their backs. But next year there are even more regulations and paperwork to deal with.
It is deeply worried about the Bill of Rights, its right to bear arms, its right to speak freely and to practice its beliefs without interference from the government. It is worried about them because it has already witnessed the dramatic erosion of its freedoms and it expects the process to continue.
It is unenthusiastic about deploying troops to maintain global hegemony or aid other nations, it is however vigorous about defending the country from enemy attack. Its members often have a tradition of military service and a skeptical view of how the politicians have used and abused the military for their own purposes.
Its skepticism of authority transcends government and extends to elites in science, academia and the entertainment industry. It recognizes the major gap between its values and theirs, and accordingly distrusts them. It is much less subject to being cowed by absolute truths presented by the elites and often seeks out alternative opinions.
What it wants most is independence from outside regulations that impinge on its way of life. It has little interest in positive rights and a defense of its rights by the government, what it would like is the ability to defend its own rights, to maintain a separation from the elites and its own property and family.
These two Republican parties have been on a collision course for some time now. The collision repeats itself in every election as it has throughout the 20th century. The Republican establishment has never really come to terms with its new core constituencies, the people resistant to the New Deal who were then joined by the people resistant to every other liberal big government innovation that came down the pike.
Between an establishment committed to moderate progressivism and a base that is unwilling to accept less freedoms and more regulation for their own good, is a massive divide. It is a cultural, economic, social and regional divide that needs to be talked about.
Too many establishment candidates have cakewalked into office by paying lip service to the concerns of the base without believing a word of it. Each time the process repeats itself, the collision becomes more explosive until something has to give.
Either the Republican establishment needs to step up to the plate and honestly repudiate its base or it needs to step aside and decide which it cares about more, deregulation or its version of the progressive agenda, because it cannot continue as a contradiction in terms without a meltdown. The current ugliness is a manifestation of that yawning gap between the two parties that cannot be bridged without an honest dialogue about the different values of those at the top and those at the bottom.
There are two Republican parties. One is fairly liberal, it is hostile to the left but it also believes in stealing their thunder by adopting moderate versions of their policies.
This Republican Party is strongly pro-business, but it believes that to succeed in a global economy the government must provide subsidies to businesses and individuals. It believes that immigration reform is needed, though its chosen candidates know to avoid using the word amnesty. It believes that national health care is inevitable and that the only way to avoid a government solution is through the individual mandate.
It is loosely conservative, but disinterested in social issues. It thinks that the left has gone too far in upending traditional values, but has no interested in combating it and finds those who do embarrassing . It adapts to changing mores with an uneasy smile and tries to pretend that it was with it all along. It has no strong religious feelings and it believes that all religious, including Islam, are basically the same.
It is strong on national defense spending, but mainly to maintain stability and national influence, not because it believes that we face any real threats. It believes that America has a responsibility to the rest of the world and that we are obligated to give back through the United Nations and other international organizations allowing us to spread our values of free enterprise and democracy to everyone.
It is a big believer in the American Dream of economic opportunity, but is unable to think of any other national virtues beyond that. It maintains a strongly Federalist legacy and while it agrees that the Federal government has overreached itself in interfering with the business of states, it has no real interest in rolling back its powers, only in making certain that they are used "wisely".
The only area where it actively rolls back the left's program is its deregulation of businesses, but even this is limited to spheres that are objectionable to specific industries which lobby for deregulation. Small businesses can expect much less help, unless they band together and forcefully make something into an issue.
It has no passion for anything beyond deregulating a few specific industries. It supports the right to bear arms, not because it passionately believes in it, but because the political costs of not doing so are too high. It opposes abortion for the same reason, though its opposition is mainly a formality. It believes that gay marriage is inevitable, but isn't willing to pick a fight with its base over it.
Its leaders and members consider themselves rationalists and believe in Global Warming because "the science says so." They sneer at those Republicans who deny what they think is the obvious. While they are skeptical of government solutions to Global Warming, they are prepared to accept an approach that does not cause too much harm to business and is routed through private companies.
It views what the Republican Party has become as an embarrassment and while it doles out red meat to the base when it has to, it despises them and constantly dreams of ways of getting rid of them. In its fondest daydreams, a graduated amnesty program for Mexican immigrants by a Republican president turns them all into legal citizens and Republican voters, allowing them to tell their guns n bibles base to kiss off.
It does not believe that Obama is bad, only inexperienced and misguided, but basically well-meaning and its lack of support for him is not due to a firm belief that his agenda is destructive, but to political calculations and the need to appease their base.
This Party is not particularly worried about the future of the United States except as a place to do business. And even then it will easily move operations offshore to Dubai or Singapore. Overall it is optimistic that things will go on as they have, with a gradual process of reform advanced by the left and moderated by the right in the political process resulting in a workable center.
Then there's the other Republican Party. This party is deeply worried about the future of the country, and not just as a place to do business. It is socially conservative, strong on national defense because it believes that we do face real threats and enemies, it is opposed to amnesty and very skeptical of Federal power.
This party is more new than it is old, it's a party that evolved in response to the transformation of the Democratic Party at the hands of the left. It is the base from which the Republican Party draws much of its support, particularly away from the Northeast, and it is struggling to force the party to match its deeds to its words.
It does not believe that most of the national debates are a tempest in a teacup that can be settled amicably behind closed doors. It is uninterested in bipartisan great compromisers, it seeks fighters who will stand up for its agenda. It is not interested in the progressive voyage to the national future that has been taken up by both parties, what it would like is independence from their reign of policy terror. It would like to roll back the progressive policymaking of both parties.
It is concerned for its ability to earn a living, for the values of its children and the basic freedoms that it can see being lost every day. It remembers a time when people had more freedom and less rules hanging over their heads. The tide of paperwork, the omnipresent regulatory state infuriate it and lead it to vote for people who claim to want Washington off their backs. But next year there are even more regulations and paperwork to deal with.
It is deeply worried about the Bill of Rights, its right to bear arms, its right to speak freely and to practice its beliefs without interference from the government. It is worried about them because it has already witnessed the dramatic erosion of its freedoms and it expects the process to continue.
It is unenthusiastic about deploying troops to maintain global hegemony or aid other nations, it is however vigorous about defending the country from enemy attack. Its members often have a tradition of military service and a skeptical view of how the politicians have used and abused the military for their own purposes.
Its skepticism of authority transcends government and extends to elites in science, academia and the entertainment industry. It recognizes the major gap between its values and theirs, and accordingly distrusts them. It is much less subject to being cowed by absolute truths presented by the elites and often seeks out alternative opinions.
What it wants most is independence from outside regulations that impinge on its way of life. It has little interest in positive rights and a defense of its rights by the government, what it would like is the ability to defend its own rights, to maintain a separation from the elites and its own property and family.
These two Republican parties have been on a collision course for some time now. The collision repeats itself in every election as it has throughout the 20th century. The Republican establishment has never really come to terms with its new core constituencies, the people resistant to the New Deal who were then joined by the people resistant to every other liberal big government innovation that came down the pike.
Between an establishment committed to moderate progressivism and a base that is unwilling to accept less freedoms and more regulation for their own good, is a massive divide. It is a cultural, economic, social and regional divide that needs to be talked about.
Too many establishment candidates have cakewalked into office by paying lip service to the concerns of the base without believing a word of it. Each time the process repeats itself, the collision becomes more explosive until something has to give.
Either the Republican establishment needs to step up to the plate and honestly repudiate its base or it needs to step aside and decide which it cares about more, deregulation or its version of the progressive agenda, because it cannot continue as a contradiction in terms without a meltdown. The current ugliness is a manifestation of that yawning gap between the two parties that cannot be bridged without an honest dialogue about the different values of those at the top and those at the bottom.
Are You ‘Them!’?
PJMedia:
Until the appearance of Barack Obama on the national scene, I knew of “them” only from an old sci-fi movie in which huge ants (“Them!”) ate people.
But there are new monsters in America, and I am starting to wonder whether I am to be considered among them: those of the uninvolved and uninformed lives, the bar-raisers, the downright mean ones, the never deserving of respect ones, the Vegas junketeers, the Super Bowl jet setters, the tuition stealers, the faux-Christians who do not pay higher taxes, the too much income makers, the tormenters of autistic children, the polluters, the enemies deserving of punishment, the targets to bring a gun against, the faces to get in front of, the limb-loppers, the tonsil pullers, the fat cats, the corporate jet owners, the one-percenters, the stupidly acting, the not paying their fair sharers, the discriminators on the “way you look”, the alligator raisers and moat builders, the vote deniers, the clingers, the typical something persons, the hunters of kids at ice cream parlors, the stereotypers and profilers, the cowards, the lazy and soft, the non-spreaders of money, the not my people people, the Tea party racists, the not been perfect and mistake makers, the disengaged and the dictating, the not the time to profiteers, the ones who did not know when to quit making money, and on and on.
My God, man, how did Barack Obama & Co. conjure up so many demons?
So Are You One of the Culpable?
This is proving to be a Manichean administration. It sees the world in terms dark and light, of us/them, and then must create the necessary binaries to divide and demonize—so strange given this was the narrative of the Obama campaign against Bush, not so strange given the Chicago origins
After three years, I realize that lots of us are on the downside of about every one of the president’s new Mason-Dixon lines. Yet I am not a one-percenter like Jon Corzine or Nancy Pelosi. I did not send my kids to private schools as did the Obamas in Chicago. I live in a racially mixed area, one of the poorest in the nation—unlike the mostly white mansion environs of John Kerry. My siblings’ families are racially mixed; I’ve never bought and sold real estate, or made much money on investments. I am certainly, then, no Rahm Emanuel, Jamie Gorelick, or Franklin Raines. I never had any developer give me a sweetheart deal to expand my backyard as did Barack Obama. I have never in my life used the term “typical black person” and would not dream of talking in terms of being a “wise white guy.” I have never been in a church where the pastor used the Lord’s name to amplify his cursing.
Sorry No Medeival Penance For Us?
Unlike Timothy Geithner, I have always paid my taxes as I should. And unlike Barbara Boxer, I for a number of years made a living driving a tractor and pruning. In other words, I should be sorta OK in the Obama’s us/them class divides. But I also have not purchased an exemption from the Obama adjudicators, and feel no guilt about anything. I did not vote for Barack Obama and I have a bad habit of criticizing much of what he wishes to do for America. Professing to being liberal and caring, after all, in this era, is more important than being so. So instead, like many of you, I am getting the feeling that Obama plans to run for reelection on the premise that millions of Americans like us have done or are doing something quite wrong to people more noble than ourselves, both here and abroad.
Punish Our Enemies?
In the last week, there was more talk on illegal immigration from open-borders activists, the Obama administration, and Mexico—all to the effect that the United States has to shape up, be more caring, and start granting amnesty (“comprehensive immigration reform”). But what are we missing? Did not over 11 million people enter the U.S. illegally, and without apparent care about the law? I would not drive into Mexico without legal identification, or sign affidavits that I knew were false, or abandon my car at the scene of an accident in Acapulco, or register for public assistance in Mexico City, but I am to expect others can do the reverse with impunity?
Does not the U.S. allow almost $50 billion to leave the country for Latin America in remittances? Are not American social services extended to illegal aliens at a time when states are near bankrupt? Are not nearly 50,000 illegal aliens housed in California prisons at a cost of at least $40,000 each per annum?
In other words, the United States seems to have been a generous host. Why then the unending anger and accusations, rather than frequent gratitude that one is living in Fresno rather than Oaxaca? Whether intended or not, the message is hourly becoming “you better let me come into your insensitive, illiberal, and uncaring country—or else!”
Rarely in the history of U.S. immigration have the representatives of want-to-be citizens been so angry at the majority of the country into which their constituents have decided to move. Only Orwell could explain why the Mexican government is suing the state of Arizona to force it to accept its own apparently unwanted Mexican nationals who have entered that state illegally: “You better let us export to you our own whom we cannot house or feed adequately (and often will not care to)—or else!”
What We Look Like Matters—Sometimes, Always, Never?
Then there was President Obama announcing his new African Americans for Obama website , where the president appeals directly to a constituency to support him on the basis of shared racial identity. I am afraid it was quite frank; mutatis mutandis the appeal would be sort of like a theoretical caricatured President Billy Bob Alabama creating a Europeanamericans.billybobalabama.com site with appeals to those who look him to give him money on that account.
Apparently the president is worried that a 96% majority of black voters might slip to near 92% in key states, given near-record levels of black unemployment during his administration.
But the problem is that there is a pattern here. This comes after the 2010 video appealing to past supporters to continue solidarity on the basis of race and gender, and all the other minority-targeted “punish our enemies” tropes. I think we got that message about March 2008: The more noble souls in our country are supposed to ensure that conservatives do not discriminate on the basis of what Americans “look like,” and so they will accomplish that precisely by appealing to voters en masse on the basis of what they look like. What a strange logic: blacks are to vote for Obama on the basis of being black, but others must vote for him on the basis of him not being black.
The More Noble Debtor
I try to pay my credit cards off each month; pay the mortgage regardless of the fluctuating value of my house; and am paying off each month my daughter’s student loans, the last of three in college. I understand that others are far worse off and so don’t mind government helping them. But in the last three years, somehow we have become a passive-voice society. The Obama administration believes that all sorts of sinister people tricked the unknowing into running up credit card debt, taking out student loans, and buying too expensive a house—and that we the taxpayers are uncaring unless we are willing to borrow more trillions to help relieve these debts.
In the last 36 months I have heard about all sorts of enemies and victims, but not a word from the president that he respects those who pay off mortgages even when equity falls, who do not charge things they cannot afford, and who try to pay their own children’s tuition without state grants and scholarships.
Why Are We Culpable?
I see no reason to apologize or bow abroad. I am all too aware that we helped save Muslims in Kosovo, Bosnia, Kuwait, Afghanistan, and Somalia and send them billions in aid to the West Bank, Egypt, and Jordan. I have no guilt about the Europeans. We have paid trillions in dollars for their defense, after saving them from Germany twice, and are far less protectionist in our trade policies than are they. Compared to the caste system in India, racialism in China and Japan, tribal chauvinism in the Arab World, and class distinctions in Europe, I find the U.S. pretty open and fair, meritocratic if you will.
Why, then, would I wish to kowtow to Saudi or Japanese royals, or to apologize in Turkey for past sins?
Post-American What?
Finally, I don’t buy into the president’s trendy “post-American world” fantasies. We are growing; Europe, Japan, China, and Russia are aging and shrinking. Is there a Facebook sprouting in Istanbul? Does Mumbai give us Wal-Mart? Does the world flock to Shanghai to learn brain surgery?
I am not worried that China’s one rusty carrier will match the power of about one-third of our eleven carrier groups. Fat flabby Americans still produce per capita three times as many goods and services as do three Chinese.
I’ve seen European and Arab universities; believe me they are no Caltech or Stanford. I’ve been in three hospitals abroad; the one in tiny Selma is to them as heaven is to hell. In most places abroad, I would not drink the water. I like American doctors; they don’t smoke as they treat you and don’t roll you into Dante’s Inferno on a gurney to rot. I don’t think they pulled out my tonsils years ago only to make a buck. My local Doc does not wish to lop off my leg.
Our gas and oil reserves grow; China’s and Japan’s shrink. If I move to China, as a Scandinavian-looking white guy I will never be accepted as fully Chinese; if a Chinese moves here, he’s liable to run a company. Barack Obama and most of us would never make it as a president or prime minister in Japan or South Korea, or for that matter France.
Mr. President, sermonize to others abroad, not to us at home, about judging people on the basis of “how they look.” In India or Brazil, Obama, as most of us, would be relegated to a caste. Yes, I am worried at the present desire to run up trillions of dollars in debt and redistribute income while ignoring the sources of traditional American material wealth. Yet I still see no reason to lead from behind. I accept no post-American anything—and am quite tired after three years of being lectured that I am supposed to.
Until the appearance of Barack Obama on the national scene, I knew of “them” only from an old sci-fi movie in which huge ants (“Them!”) ate people.
But there are new monsters in America, and I am starting to wonder whether I am to be considered among them: those of the uninvolved and uninformed lives, the bar-raisers, the downright mean ones, the never deserving of respect ones, the Vegas junketeers, the Super Bowl jet setters, the tuition stealers, the faux-Christians who do not pay higher taxes, the too much income makers, the tormenters of autistic children, the polluters, the enemies deserving of punishment, the targets to bring a gun against, the faces to get in front of, the limb-loppers, the tonsil pullers, the fat cats, the corporate jet owners, the one-percenters, the stupidly acting, the not paying their fair sharers, the discriminators on the “way you look”, the alligator raisers and moat builders, the vote deniers, the clingers, the typical something persons, the hunters of kids at ice cream parlors, the stereotypers and profilers, the cowards, the lazy and soft, the non-spreaders of money, the not my people people, the Tea party racists, the not been perfect and mistake makers, the disengaged and the dictating, the not the time to profiteers, the ones who did not know when to quit making money, and on and on.
My God, man, how did Barack Obama & Co. conjure up so many demons?
So Are You One of the Culpable?
This is proving to be a Manichean administration. It sees the world in terms dark and light, of us/them, and then must create the necessary binaries to divide and demonize—so strange given this was the narrative of the Obama campaign against Bush, not so strange given the Chicago origins
After three years, I realize that lots of us are on the downside of about every one of the president’s new Mason-Dixon lines. Yet I am not a one-percenter like Jon Corzine or Nancy Pelosi. I did not send my kids to private schools as did the Obamas in Chicago. I live in a racially mixed area, one of the poorest in the nation—unlike the mostly white mansion environs of John Kerry. My siblings’ families are racially mixed; I’ve never bought and sold real estate, or made much money on investments. I am certainly, then, no Rahm Emanuel, Jamie Gorelick, or Franklin Raines. I never had any developer give me a sweetheart deal to expand my backyard as did Barack Obama. I have never in my life used the term “typical black person” and would not dream of talking in terms of being a “wise white guy.” I have never been in a church where the pastor used the Lord’s name to amplify his cursing.
Sorry No Medeival Penance For Us?
Unlike Timothy Geithner, I have always paid my taxes as I should. And unlike Barbara Boxer, I for a number of years made a living driving a tractor and pruning. In other words, I should be sorta OK in the Obama’s us/them class divides. But I also have not purchased an exemption from the Obama adjudicators, and feel no guilt about anything. I did not vote for Barack Obama and I have a bad habit of criticizing much of what he wishes to do for America. Professing to being liberal and caring, after all, in this era, is more important than being so. So instead, like many of you, I am getting the feeling that Obama plans to run for reelection on the premise that millions of Americans like us have done or are doing something quite wrong to people more noble than ourselves, both here and abroad.
Punish Our Enemies?
In the last week, there was more talk on illegal immigration from open-borders activists, the Obama administration, and Mexico—all to the effect that the United States has to shape up, be more caring, and start granting amnesty (“comprehensive immigration reform”). But what are we missing? Did not over 11 million people enter the U.S. illegally, and without apparent care about the law? I would not drive into Mexico without legal identification, or sign affidavits that I knew were false, or abandon my car at the scene of an accident in Acapulco, or register for public assistance in Mexico City, but I am to expect others can do the reverse with impunity?
Does not the U.S. allow almost $50 billion to leave the country for Latin America in remittances? Are not American social services extended to illegal aliens at a time when states are near bankrupt? Are not nearly 50,000 illegal aliens housed in California prisons at a cost of at least $40,000 each per annum?
In other words, the United States seems to have been a generous host. Why then the unending anger and accusations, rather than frequent gratitude that one is living in Fresno rather than Oaxaca? Whether intended or not, the message is hourly becoming “you better let me come into your insensitive, illiberal, and uncaring country—or else!”
Rarely in the history of U.S. immigration have the representatives of want-to-be citizens been so angry at the majority of the country into which their constituents have decided to move. Only Orwell could explain why the Mexican government is suing the state of Arizona to force it to accept its own apparently unwanted Mexican nationals who have entered that state illegally: “You better let us export to you our own whom we cannot house or feed adequately (and often will not care to)—or else!”
What We Look Like Matters—Sometimes, Always, Never?
Then there was President Obama announcing his new African Americans for Obama website , where the president appeals directly to a constituency to support him on the basis of shared racial identity. I am afraid it was quite frank; mutatis mutandis the appeal would be sort of like a theoretical caricatured President Billy Bob Alabama creating a Europeanamericans.billybobalabama.com site with appeals to those who look him to give him money on that account.
Apparently the president is worried that a 96% majority of black voters might slip to near 92% in key states, given near-record levels of black unemployment during his administration.
But the problem is that there is a pattern here. This comes after the 2010 video appealing to past supporters to continue solidarity on the basis of race and gender, and all the other minority-targeted “punish our enemies” tropes. I think we got that message about March 2008: The more noble souls in our country are supposed to ensure that conservatives do not discriminate on the basis of what Americans “look like,” and so they will accomplish that precisely by appealing to voters en masse on the basis of what they look like. What a strange logic: blacks are to vote for Obama on the basis of being black, but others must vote for him on the basis of him not being black.
The More Noble Debtor
I try to pay my credit cards off each month; pay the mortgage regardless of the fluctuating value of my house; and am paying off each month my daughter’s student loans, the last of three in college. I understand that others are far worse off and so don’t mind government helping them. But in the last three years, somehow we have become a passive-voice society. The Obama administration believes that all sorts of sinister people tricked the unknowing into running up credit card debt, taking out student loans, and buying too expensive a house—and that we the taxpayers are uncaring unless we are willing to borrow more trillions to help relieve these debts.
In the last 36 months I have heard about all sorts of enemies and victims, but not a word from the president that he respects those who pay off mortgages even when equity falls, who do not charge things they cannot afford, and who try to pay their own children’s tuition without state grants and scholarships.
Why Are We Culpable?
I see no reason to apologize or bow abroad. I am all too aware that we helped save Muslims in Kosovo, Bosnia, Kuwait, Afghanistan, and Somalia and send them billions in aid to the West Bank, Egypt, and Jordan. I have no guilt about the Europeans. We have paid trillions in dollars for their defense, after saving them from Germany twice, and are far less protectionist in our trade policies than are they. Compared to the caste system in India, racialism in China and Japan, tribal chauvinism in the Arab World, and class distinctions in Europe, I find the U.S. pretty open and fair, meritocratic if you will.
Why, then, would I wish to kowtow to Saudi or Japanese royals, or to apologize in Turkey for past sins?
Post-American What?
Finally, I don’t buy into the president’s trendy “post-American world” fantasies. We are growing; Europe, Japan, China, and Russia are aging and shrinking. Is there a Facebook sprouting in Istanbul? Does Mumbai give us Wal-Mart? Does the world flock to Shanghai to learn brain surgery?
I am not worried that China’s one rusty carrier will match the power of about one-third of our eleven carrier groups. Fat flabby Americans still produce per capita three times as many goods and services as do three Chinese.
I’ve seen European and Arab universities; believe me they are no Caltech or Stanford. I’ve been in three hospitals abroad; the one in tiny Selma is to them as heaven is to hell. In most places abroad, I would not drink the water. I like American doctors; they don’t smoke as they treat you and don’t roll you into Dante’s Inferno on a gurney to rot. I don’t think they pulled out my tonsils years ago only to make a buck. My local Doc does not wish to lop off my leg.
Our gas and oil reserves grow; China’s and Japan’s shrink. If I move to China, as a Scandinavian-looking white guy I will never be accepted as fully Chinese; if a Chinese moves here, he’s liable to run a company. Barack Obama and most of us would never make it as a president or prime minister in Japan or South Korea, or for that matter France.
Mr. President, sermonize to others abroad, not to us at home, about judging people on the basis of “how they look.” In India or Brazil, Obama, as most of us, would be relegated to a caste. Yes, I am worried at the present desire to run up trillions of dollars in debt and redistribute income while ignoring the sources of traditional American material wealth. Yet I still see no reason to lead from behind. I accept no post-American anything—and am quite tired after three years of being lectured that I am supposed to.
The Court That Broke Jersey
City-Journal:
The state’s activist judiciary has forced taxpayers to finance unprecedented educational and housing regimes.
Squelching rumors this past fall of a presidential run, New Jersey governor Chris Christie observed that he had lots more to do to fix a “broken” state. He wasn’t kidding: though already the nation’s most heavily taxed state, New Jersey can balance its budget only by ignoring billions of dollars in employee pension liabilities and by slashing aid to struggling local governments. Christie has pushed through reforms that cut spending and cap property-tax increases. But he has only begun to grapple with an institution that bears much of the responsibility for the state’s fiscal woes: the New Jersey Supreme Court.
For half a century now, New Jersey has been home to the most activist state appellate court in America. Lauded by proponents of “living” constitutions who urge courts to make policy instead of interpret the law as written, the New Jersey Supreme Court has profoundly transformed the Garden State by seizing control of school funding, hijacking zoning powers from towns and cities to increase subsidized housing, and nullifying taxpayer protections in the state constitution. Its undemocratic actions have blown apart the state’s finances and led to ill-conceived and ineffective policies. If you want to understand what rule by liberal judges looks like on the state level, you need only look at New Jersey, which is teetering on bankruptcy though it remains one of America’s wealthiest states.
In January, Christie nominated two new members to the court, appointments that have the capacity to reshape the seven-member panel. But taming the court won’t be easy, even for the pugnacious Christie, whose initial efforts to reform it met ferocious resistance. “I don’t think the supreme court has any business being involved in setting the budget of the state government,” Christie complained last year. Yet it is involved, extensively—and that must change if Jersey taxpayers are ever to find relief.
New Jersey’s supreme court, charged with hearing cases brought to it from lower judicial levels, is the product of the state’s 1947 constitution, which replaced an unwieldy 16-member Court of Errors and Appeals with today’s seven-member body, appointed by the governor and confirmed by the state senate. A dean of New York University’s law school, Arthur Vanderbilt, served as the new court’s first chief justice. Vanderbilt is best remembered today for persuading President Dwight Eisenhower to appoint William Brennan, at the time also a Jersey justice, to the U.S. Supreme Court, whose liberal activist wing he led for more than three decades.
As chief justice for nine years, Vanderbilt helped forge the New Jersey Supreme Court’s expansive understanding of its role. For instance, he wrote the majority opinion in Winberry v. Salisbury, a decision that gave the court itself, not the legislature, the power to make rules for the state judiciary. That ruling set New Jersey’s judiciary apart from the court systems in most other states—as well as from the federal judiciary, which ultimately derives its authority from Congress. Some critics have even argued that Winberry violates the U.S. Constitution’s guarantee that every state must have a republican form of government. “Under the doctrine of Winberry v. Salisbury,” wrote New Jersey lawyer Anthony Kearns in a 1955 ABA Journal article, “we can only conclude that laws of practice and procedure are exclusively in the hands of men who are not elected.”
Since Winberry, the court has usurped the roles of the governor and the state legislature in many other areas, relying on questionable readings of the New Jersey Constitution to pursue its own views of justice. But nowhere has the court’s ambition had a bigger or more disastrous impact than in education policy, particularly with a series of decisions, collectively known as Abbott v. Burke, that have massively extended judicial control over the Jersey schools.
The Abbott cases initially resembled dozens of “fiscal-equity” lawsuits filed around the country beginning in the late 1960s. These suits challenged education funding levels for urban school districts, arguing that because schools were financed through local property taxes, wealthy districts received far more funding than less affluent ones did—especially as migration from troubled cities dragged down property values. This, the lawsuits contended, violated various provisions in state constitutions.
In 20 states, judges largely dismissed the suits as outside the scope of those constitutions. In 16 others, courts ordered states to come up with more equitable ways to finance the schools. This generally meant spending more money, often raised through sales and income taxes, in lower-income districts. New Jersey was one of the 16; in its case, the key constitutional phrase guaranteed state residents a “thorough and efficient system of free public schools.” At first, the New Jersey Supreme Court followed the path of other state courts and simply ordered extra spending in poor districts. But in 1976, when the state legislature didn’t comply, the court ordered the schools shut down until the legislature agreed to institute a tax to fund the new spending. The chief justice at the time was Richard Hughes, who had previously spent eight years as governor trying fruitlessly to get the state legislature to enact an income tax to boost education spending. “They didn’t want the income tax then? Well, they’ll want one now,” Hughes told the press. Years later, he admitted that he had wielded as much power as chief justice as he had in the governor’s seat.
But an advocacy group called the Education Law Center challenged the new spending. Merely giving urban schools new funding wasn’t enough to satisfy the “thorough and efficient” clause, the group argued; the state had to fund education in urban districts at a level that would enable them to compete with plush suburban districts. In 1985, the New Jersey Supremes agreed, and when James Florio took the governor’s office five years later, he complied by passing $2.8 billion in sales- and income-tax increases—the largest such hike in state history—to bring the city schools up to par. The court, still unsatisfied, quickly ruled that the state had to add yet more “supplemental” spending to poor districts to help offset the “additional disadvantages” that students in those areas faced. After the tax increase cost Florio reelection in 1993, his successor, Christine Todd Whitman, passed her own education financing formula, which sought to increase spending in urban districts to within $1,200 per pupil of what Jersey’s richest districts spent.
That was still not enough for the supreme court. In what became known as Abbott IV, the judges declared Whitman’s plan unconstitutional and ordered the state to fund poor districts generously enough that their per-pupil spending would be the same as in the state’s wealthiest districts—which were among the richest in the nation. The court also ruled that the state had to pay for a menu of new social programs for kids in poor districts (now called “Abbott districts”).
Over the next decade, as the plaintiffs returned to the New Jersey Supreme Court nearly a dozen times, the judges steadily transformed the nature of the case. No longer was it simply a matter of “fiscal equity”; rather, it morphed into what judicial analysts call an “adequacy” case, in which the court determines what constitutes an adequate education. Judges don’t merely determine levels of spending; they also initiate and monitor specific programs—policy details that, in most states, are left to elected officials. In short, the supreme court seized power in education policy.
It used that power in unthinking and expensive ways. For example, it ordered pre-K classes to be offered to all three- and four-year-olds in Abbott districts, even though the state constitution guarantees public education only for children “between the ages of five and eighteen.” Some studies have found no educational gain from such programs, while others suggest that only students in extremely expensive versions, with small student-to-teacher ratios, can make tiny gains, hard to replicate across entire school systems. “The evidence does not support instituting broad, full-scale programs,” conclude education scholars Eric Hanushek and Alfred Lindseth in their 2009 book Schoolhouses, Courthouses and Statehouses. The pre-K program would grow to cost New Jersey $500 million annually.
Meanwhile, the court ignored numerous examples of how some urban school districts were failing because they were run by corrupt, wasteful political machines whose main goals were patronage and power, not educational success. In 1986, the state described the Jersey City school system as “adrift, having a managerial structure which is a product of politics and patronage.” In 1994, after a long investigation, the state issued a damning report on the Newark school system, accusing it of being “at best flagrantly delinquent and at worst deceptive in discharging its obligations to the children.” At the time, the Newark system, thanks to the Abbott-mandated state aid, was spending $10,700 per pupil, significantly higher than the Jersey average of $8,571. In 2002, a similar state investigation into Camden schools found, as the Courier-Post of Cherry Hill summarized it, “a lack of planning, a chaotic budget process, too many employees in virtually every department and lack of spending controls.” At the same time, a state arbitrator working in another Abbott district, Asbury Park, wrote that “a crisis exists” because of “a pervasive feeling of educational corruption.”
The court’s typical solution to such corruption and waste was to spend more money. One striking episode took place a few years after the judges demanded virtually a top-to-bottom refurbishing of school buildings in Abbott districts. The state, determining that the cost of compliance would be an astonishing $6 billion, had floated a massive $8.6 billion bond offering, through a newly formed state construction authority, to pay for the work (and to finance some building in other districts). But it turned out that the authority could complete only half the job with the money. The reason, as investigations later revealed, was that the authority was riddled with patronage, waste, and inefficient management. The court’s response: ordering the state to borrow another $3.9 billion to finish the work.
The court also seemed oblivious to the fact that, no matter how much money the state spent, educational “adequacy” in the Abbott districts would remain a casualty of widespread family breakdown. In Newark and Camden, about 70 percent of children grow up in homes without fathers—which, research shows, frequently leads to dismal academic performance and high drop-out rates. “While many of the mothers and grandmothers were making a tremendous effort with their children, the consequences for most of the fatherless kids were devastating,” wrote Saul Cooperman, the state’s former education commissioner, in a 2002 op-ed. Assessing the likely effectiveness of the supreme court’s education mandates, Cooperman was blunt: “Until dramatically more fathers as well as mothers raise their children in our cities, we may be disappointed with the results.”
The New Jersey Supreme Court’s education mandates have produced some of the most extravagantly funded school districts in the nation. Since 1998, the state has sent more than $40 billion to Abbott districts, which receive the vast majority of their funding from outside their municipalities. The Newark School District’s current $809 million operating budget receives only $110 million of that total, about 14 percent, from local taxes; most of the rest comes from state aid, with some federal and private grants on top. In Asbury Park, local taxpayers contribute just $6.2 million of the system’s $62 million operating budget; the state provides $54 million. Local sources contribute $10.8 million—just 4 percent—of the Camden district’s $290 million budget, with the state on the hook for $267 million. And so on.
These court-ordered state contributions have blasted per-pupil spending into the stratosphere. The Asbury Park district leads the way, spending an astounding $29,797 per student, according to the latest U.S. Census figures. Camden spends $23,356 per pupil, while Newark spends $21,895 and Jersey City $20,366. (Official New Jersey Department of Education spending figures are slightly lower because the court requires the state to exclude certain aid in reporting its education spending.)
The spending has depended, of course, on a massive redistribution of wealth, which has left many towns big losers. In Jersey these days, as in most states, even non-needy school districts get some funding from the state. But of the state’s nearly 600 municipalities, 166 get back ten cents or less for their schools for every dollar in income taxes that their residents send to Trenton, according to data compiled by state senator Mike Doherty. In 2010, three affluent towns—Millburn, Livingston, and Bernards—each sent more than $100 million in income taxes to Trenton, yet Millburn and Livingston got back no money for their schools, and Bernards got just $850,000. Middle-class towns do little better. East Rutherford, where the average household income is $64,500 (about $4,000 below the state average), gets only five cents of education aid for every income-tax dollar that it sends to the state.
The tens of billions of dollars spent on Abbott districts have yielded almost no significant educational gains. Last June, the National Assessment of Educational Progress (NAEP), whose tests are considered the gold standard in education assessment, issued a study of Hispanic and white scores in math and reading. The study showed that the gap in combined scores between whites and Hispanics remained about the same in Jersey—where about half of all minority students live in Abbott districts—as it was nationally. Among black students, according to a similar NAEP study from 2009, the lack of progress was even more pronounced. In fourth grade, the reading gap between whites and blacks was virtually the same in Jersey as in the nation as a whole; but by eighth grade, Jersey’s black kids were 31 points behind their white counterparts, compared with a 25-point gap nationally. Several years ago, the head of the Education Law Center essentially admitted the stunning failure of all the court-ordered spending, arguing that student performance on tests shouldn’t be the criterion for judging the effectiveness of the court’s actions.
The very communities that the New Jersey Supreme Court set out to help have grown frustrated with its simplistic, money-solves-everything approach. Several years ago, the Black Ministers’ Council of New Jersey, exasperated with many urban school districts’ resistance to education reforms, endorsed school vouchers for inner-city students. “For the 26 years I have been in New Jersey, there have been a host of public school reform proposals, a multitude of major state supreme court rulings, and billions of dollars spent to achieve parity and improve test scores,” the Reverend Reginald T. Jackson, the group’s executive director, said. “Yet the fact remains that with few exceptions, urban schools and most minority students still do not meet minimum state standards or receive a quality education.”
New Jersey’s constitution says nothing about affordable housing, but that hasn’t stopped the New Jersey Supreme Court from imposing a costly housing regime every bit as ambitious as its dictates on the schools. The housing mess began back in the early 1970s, when the NAACP sued Mount Laurel, charging that the town’s zoning laws—which set minimum lot and dwelling sizes for new residential construction—were illegal because they excluded the development of high-density, low-income housing.
In its 1975 ruling on the case, the court argued that affordable housing was essential to the general welfare of the Jersey population and therefore a necessary concern of government. “There cannot be the slightest doubt that shelter, along with food, are the most basic human needs,” the judges observed. Further, the fact that residents of similar wealth chose to live near one another—something that residents in most of the United States and, indeed, in almost every industrialized country choose to do—was evidence that municipalities were conspiring to keep lower-income people out, the court said. Municipalities therefore had to alter their zoning laws to ensure that they had a “fair share” of affordable housing—and that included small towns like Mount Laurel, which at the time had only 11,000 residents.
A few years later, the supreme court issued Mount Laurel II, a ruling that not only reaffirmed the “fair share” principle but also required municipalities to use incentives—subsidies to developers and parcels of land specially set aside for the purpose—to guarantee that the housing got built. Then the court added a startling twist: a “builder’s remedy,” which empowered developers to sue towns to force them to comply with the affordable-housing decrees. A trial lawyer’s dream, the builder’s remedy swiftly became a nightmarish burden on communities. Within just two years of the decision, builders had launched housing lawsuits against 140 Jersey municipalities. Lawyers specializing in the housing cases helpfully created a website that listed towns for builders to sue. The lawsuits forced some municipalities to spend up to $1 million in legal fees trying to defend themselves.
An even worse consequence was the way the lawsuits transformed many towns forever—especially after further judicial rulings encouraged the construction not only of low-income units but of market-rate housing, too, some of the profits of which would be used to offset the costs of the subsidized housing. Quiet Jersey towns were remade into sprawling suburbs, whether residents wanted that or not. In West Windsor, a tiny township near Princeton, a lower court approved a massive 1,100-unit development after a builder sued under Mount Laurel II, increasing the number of residences in town by 15 percent. Builders used the courts to get a green light for a 450-unit development in Oakland, boosting the town’s residences by 10 percent. (A Jersey environmental group later singled out that development as the state’s worst example of suburban sprawl.) Yet more supreme court decisions ordered municipalities to increase their stock of affordable housing as employment grew, the idea being that people should live near their workplaces. This new construction sparked commercial development to serve the new residents, which generated even more housing requirements.
The court-driven frenzy of building has weighed heavily on towns and taxpayers. In 1991, the court ruled that towns couldn’t tax the subsidized housing units at the same rate as other residences in their communities; the towns then raised property taxes on existing residents to pay for the extra services necessitated by the new construction. After the population of rural Clinton, for example, sharply increased as a result of the court-ordered housing construction, property taxes there doubled.
Seeking to bring some certainty to the frenzy of housing lawsuits and zoning battles that the supreme court had unleashed, New Jersey created the Council on Affordable Housing (COAH) and told it to figure out how much affordable housing the state needed and what each locality’s “fair share” was. In 2002, COAH estimated that the court’s mandate had resulted in the construction of 45,000 units of affordable housing across the state. Not enough, the council concluded: 118,000 was the target number. COAH then set about determining every town’s “fair share” of that load, a task that has proved nearly as controversial as the builder’s remedy and has provoked more suits and countersuits. The estimated cost in new taxes to complete COAH’s affordable-housing goals: $10 billion. Small wonder that towns continue to contest the mandates.
The New Jersey Supreme Court hasn’t satisfied itself with imposing unbearable costs on Garden State taxpayers. It has also allowed Trenton to ignore restrictions that the state’s constitution places on borrowing and spending—essentially nullifying these protections against profligate government. In 1991, a Wisconsin Law Review article concluded that no other state court had gone as far in ignoring such protections. “The response of the New Jersey courts to that state’s constitutional debt limitations is easy to summarize: the New Jersey Supreme Court has effectively read the limitations out of the constitution,” the authors noted.
That tradition has continued into the new millennium. When the court ordered the state to spend all those billions to upgrade Abbott school facilities, the state didn’t get taxpayer approval to establish the independent authority that borrowed the money. A group headed by Bogota mayor Steven Lonegan sued, claiming that the move violated the state constitution’s requirement that voters sign off on government debt. The court ruled against the group in 2002, accepting the argument that the construction bonds weren’t covered by the constitutional requirement because they, unlike most state bonds, were guaranteed not by taxpayers but by the state legislature. Of course, that distinction is a fiction, since the legislature gets most of its money from those very taxpayers.
Two years later, Governor James McGreevey and the Democratic majority in the legislature decided to borrow nearly $2 billion to close the state’s budget deficit and finance a staggering 17 percent spending increase. Lonegan and Republican legislators sued to stop the debt raid, pointing out that the state constitution unambiguously banned government borrowing to pay for everyday operating expenses. The court acknowledged that the plan was unconstitutional—but then let it go forward because it didn’t want a “disruption” in state government.
The supreme court’s spending mandates have left taxpayers in Jersey groaning under the nation’s highest tax burden: more than 12 percent of income produced there goes to state and local taxes, according to the Washington-based Tax Foundation. Residents’ income taxes pay for court-ordered spending in far-off urban school systems, as well as for a state government that, thanks to the court, is untrammeled by constitutional limits on spending. Meanwhile, the property taxes that residents pay to finance their own school systems and local government must rise to pay for the court’s local housing schemes.
Jerseyites have slowly come to understand the price that they’ve paid for America’s most activist court. A 2009 survey by the Polling Company, Inc. found that only 28 percent of the state’s voters gave the court a favorable rating. “If the members of the Supreme Court want to legislate, then they have the right, like every other citizen, to run for the Legislature,” state senator Doherty wrote in an op-ed for Newark’s Star-Ledger last May. “In doing so, they can place their agenda before the voters and the voters will decide. That’s democracy. What we have now is judicial tyranny.”
In at least two ways, the New Jersey Supreme Court will complicate Governor Christie’s battle to fix the state’s out-of-control spending habits. For one thing, the court probably will block some of the reforms that Christie wants—such as a revamped distribution of state education aid in which every school district would get the same dollar amount per pupil, a change that would fund essential services in poorer districts without bankrupting middle-income taxpayers. Christie also wants an affordable-housing regime that concentrates building in areas of the state with the preexisting infrastructure—mass transit, for example—that can support the new housing, another reform that the court is likely to stymie.
Second, the court will make it harder for Republicans, who tend to support Christie’s fiscal reforms, to win control of Jersey’s legislature. That’s because legislative redistricting in the state, which takes place every ten years, is handled by a bipartisan commission of Republicans and Democrats who are frequently deadlocked. The chief justice of the New Jersey Supreme Court gets to select a person to break the deadlock, and in 2001 and 2011, he selected a Rutgers University professor who sided with the Democrats. As the New York Times observed, redistricting ten years ago was crucial to the Democrats’ seizing control of the state legislature, while last year’s redistricting helped them maintain legislative control despite Christie’s personal popularity.
The obvious solution is to reform the court itself, but that won’t be easy, as Christie has already learned. Judges serve an initial seven-year term and then routinely get reappointed for a term that lasts until the mandatory retirement age of 70. In 2010, Christie tried to shake up the court by not reappointing Justice John E. Wallace, Jr., whose initial seven years had run out. The state senate, under Democratic control, refused even to consider voting on the replacement suggested by the governor—well-regarded lawyer Anne Patterson—and left a vacancy in the court. The press, meanwhile, claimed that Christie was trying to politicize the judiciary: the New York Times denounced his decision not to reappoint Wallace as a “national disgrace,” while the Philadelphia Inquirer called it an “error in judgment” and the Star-Ledger claimed that Christie had “cast a shadow” on the court. Only later, when another justice, Roberto Rivera-Soto, stepped down, did the senate confirm Patterson.
This year, Wallace and another justice will turn 70, giving Christie two more appointments. In January, Christie nominated to the court Bruce Harris, a Republican African-American mayor of Chatham Borough, an affluent suburban town, and a former lawyer at the same firm where Patterson served. Christie also tapped Phil Kwon, a Korean immigrant who worked under the governor when he was the U.S. attorney for New Jersey. Neither nominee has served on the bench previously, so they have no record of decisions, but Christie said that he was intent on appointing judges who would interpret the law, not legislate from the bench. He’ll still have to take into consideration a Democrat-controlled legislature that’s often happy to dodge responsibility for heavy spending by letting the court mandate it.
One thing is clear: somehow, New Jersey needs to rein in its judiciary if it hopes to get its house in order. The state will never be able to solve its fiscal problems until its highest court sticks to interpreting the law, not inventing it.
Steven Malanga is the senior editor of City Journal and a senior fellow at the Manhattan Institute.
The state’s activist judiciary has forced taxpayers to finance unprecedented educational and housing regimes.
Squelching rumors this past fall of a presidential run, New Jersey governor Chris Christie observed that he had lots more to do to fix a “broken” state. He wasn’t kidding: though already the nation’s most heavily taxed state, New Jersey can balance its budget only by ignoring billions of dollars in employee pension liabilities and by slashing aid to struggling local governments. Christie has pushed through reforms that cut spending and cap property-tax increases. But he has only begun to grapple with an institution that bears much of the responsibility for the state’s fiscal woes: the New Jersey Supreme Court.
For half a century now, New Jersey has been home to the most activist state appellate court in America. Lauded by proponents of “living” constitutions who urge courts to make policy instead of interpret the law as written, the New Jersey Supreme Court has profoundly transformed the Garden State by seizing control of school funding, hijacking zoning powers from towns and cities to increase subsidized housing, and nullifying taxpayer protections in the state constitution. Its undemocratic actions have blown apart the state’s finances and led to ill-conceived and ineffective policies. If you want to understand what rule by liberal judges looks like on the state level, you need only look at New Jersey, which is teetering on bankruptcy though it remains one of America’s wealthiest states.
In January, Christie nominated two new members to the court, appointments that have the capacity to reshape the seven-member panel. But taming the court won’t be easy, even for the pugnacious Christie, whose initial efforts to reform it met ferocious resistance. “I don’t think the supreme court has any business being involved in setting the budget of the state government,” Christie complained last year. Yet it is involved, extensively—and that must change if Jersey taxpayers are ever to find relief.
New Jersey’s supreme court, charged with hearing cases brought to it from lower judicial levels, is the product of the state’s 1947 constitution, which replaced an unwieldy 16-member Court of Errors and Appeals with today’s seven-member body, appointed by the governor and confirmed by the state senate. A dean of New York University’s law school, Arthur Vanderbilt, served as the new court’s first chief justice. Vanderbilt is best remembered today for persuading President Dwight Eisenhower to appoint William Brennan, at the time also a Jersey justice, to the U.S. Supreme Court, whose liberal activist wing he led for more than three decades.
As chief justice for nine years, Vanderbilt helped forge the New Jersey Supreme Court’s expansive understanding of its role. For instance, he wrote the majority opinion in Winberry v. Salisbury, a decision that gave the court itself, not the legislature, the power to make rules for the state judiciary. That ruling set New Jersey’s judiciary apart from the court systems in most other states—as well as from the federal judiciary, which ultimately derives its authority from Congress. Some critics have even argued that Winberry violates the U.S. Constitution’s guarantee that every state must have a republican form of government. “Under the doctrine of Winberry v. Salisbury,” wrote New Jersey lawyer Anthony Kearns in a 1955 ABA Journal article, “we can only conclude that laws of practice and procedure are exclusively in the hands of men who are not elected.”
Since Winberry, the court has usurped the roles of the governor and the state legislature in many other areas, relying on questionable readings of the New Jersey Constitution to pursue its own views of justice. But nowhere has the court’s ambition had a bigger or more disastrous impact than in education policy, particularly with a series of decisions, collectively known as Abbott v. Burke, that have massively extended judicial control over the Jersey schools.
The Abbott cases initially resembled dozens of “fiscal-equity” lawsuits filed around the country beginning in the late 1960s. These suits challenged education funding levels for urban school districts, arguing that because schools were financed through local property taxes, wealthy districts received far more funding than less affluent ones did—especially as migration from troubled cities dragged down property values. This, the lawsuits contended, violated various provisions in state constitutions.
In 20 states, judges largely dismissed the suits as outside the scope of those constitutions. In 16 others, courts ordered states to come up with more equitable ways to finance the schools. This generally meant spending more money, often raised through sales and income taxes, in lower-income districts. New Jersey was one of the 16; in its case, the key constitutional phrase guaranteed state residents a “thorough and efficient system of free public schools.” At first, the New Jersey Supreme Court followed the path of other state courts and simply ordered extra spending in poor districts. But in 1976, when the state legislature didn’t comply, the court ordered the schools shut down until the legislature agreed to institute a tax to fund the new spending. The chief justice at the time was Richard Hughes, who had previously spent eight years as governor trying fruitlessly to get the state legislature to enact an income tax to boost education spending. “They didn’t want the income tax then? Well, they’ll want one now,” Hughes told the press. Years later, he admitted that he had wielded as much power as chief justice as he had in the governor’s seat.
But an advocacy group called the Education Law Center challenged the new spending. Merely giving urban schools new funding wasn’t enough to satisfy the “thorough and efficient” clause, the group argued; the state had to fund education in urban districts at a level that would enable them to compete with plush suburban districts. In 1985, the New Jersey Supremes agreed, and when James Florio took the governor’s office five years later, he complied by passing $2.8 billion in sales- and income-tax increases—the largest such hike in state history—to bring the city schools up to par. The court, still unsatisfied, quickly ruled that the state had to add yet more “supplemental” spending to poor districts to help offset the “additional disadvantages” that students in those areas faced. After the tax increase cost Florio reelection in 1993, his successor, Christine Todd Whitman, passed her own education financing formula, which sought to increase spending in urban districts to within $1,200 per pupil of what Jersey’s richest districts spent.
That was still not enough for the supreme court. In what became known as Abbott IV, the judges declared Whitman’s plan unconstitutional and ordered the state to fund poor districts generously enough that their per-pupil spending would be the same as in the state’s wealthiest districts—which were among the richest in the nation. The court also ruled that the state had to pay for a menu of new social programs for kids in poor districts (now called “Abbott districts”).
Over the next decade, as the plaintiffs returned to the New Jersey Supreme Court nearly a dozen times, the judges steadily transformed the nature of the case. No longer was it simply a matter of “fiscal equity”; rather, it morphed into what judicial analysts call an “adequacy” case, in which the court determines what constitutes an adequate education. Judges don’t merely determine levels of spending; they also initiate and monitor specific programs—policy details that, in most states, are left to elected officials. In short, the supreme court seized power in education policy.
It used that power in unthinking and expensive ways. For example, it ordered pre-K classes to be offered to all three- and four-year-olds in Abbott districts, even though the state constitution guarantees public education only for children “between the ages of five and eighteen.” Some studies have found no educational gain from such programs, while others suggest that only students in extremely expensive versions, with small student-to-teacher ratios, can make tiny gains, hard to replicate across entire school systems. “The evidence does not support instituting broad, full-scale programs,” conclude education scholars Eric Hanushek and Alfred Lindseth in their 2009 book Schoolhouses, Courthouses and Statehouses. The pre-K program would grow to cost New Jersey $500 million annually.
Meanwhile, the court ignored numerous examples of how some urban school districts were failing because they were run by corrupt, wasteful political machines whose main goals were patronage and power, not educational success. In 1986, the state described the Jersey City school system as “adrift, having a managerial structure which is a product of politics and patronage.” In 1994, after a long investigation, the state issued a damning report on the Newark school system, accusing it of being “at best flagrantly delinquent and at worst deceptive in discharging its obligations to the children.” At the time, the Newark system, thanks to the Abbott-mandated state aid, was spending $10,700 per pupil, significantly higher than the Jersey average of $8,571. In 2002, a similar state investigation into Camden schools found, as the Courier-Post of Cherry Hill summarized it, “a lack of planning, a chaotic budget process, too many employees in virtually every department and lack of spending controls.” At the same time, a state arbitrator working in another Abbott district, Asbury Park, wrote that “a crisis exists” because of “a pervasive feeling of educational corruption.”
The court’s typical solution to such corruption and waste was to spend more money. One striking episode took place a few years after the judges demanded virtually a top-to-bottom refurbishing of school buildings in Abbott districts. The state, determining that the cost of compliance would be an astonishing $6 billion, had floated a massive $8.6 billion bond offering, through a newly formed state construction authority, to pay for the work (and to finance some building in other districts). But it turned out that the authority could complete only half the job with the money. The reason, as investigations later revealed, was that the authority was riddled with patronage, waste, and inefficient management. The court’s response: ordering the state to borrow another $3.9 billion to finish the work.
The court also seemed oblivious to the fact that, no matter how much money the state spent, educational “adequacy” in the Abbott districts would remain a casualty of widespread family breakdown. In Newark and Camden, about 70 percent of children grow up in homes without fathers—which, research shows, frequently leads to dismal academic performance and high drop-out rates. “While many of the mothers and grandmothers were making a tremendous effort with their children, the consequences for most of the fatherless kids were devastating,” wrote Saul Cooperman, the state’s former education commissioner, in a 2002 op-ed. Assessing the likely effectiveness of the supreme court’s education mandates, Cooperman was blunt: “Until dramatically more fathers as well as mothers raise their children in our cities, we may be disappointed with the results.”
The New Jersey Supreme Court’s education mandates have produced some of the most extravagantly funded school districts in the nation. Since 1998, the state has sent more than $40 billion to Abbott districts, which receive the vast majority of their funding from outside their municipalities. The Newark School District’s current $809 million operating budget receives only $110 million of that total, about 14 percent, from local taxes; most of the rest comes from state aid, with some federal and private grants on top. In Asbury Park, local taxpayers contribute just $6.2 million of the system’s $62 million operating budget; the state provides $54 million. Local sources contribute $10.8 million—just 4 percent—of the Camden district’s $290 million budget, with the state on the hook for $267 million. And so on.
These court-ordered state contributions have blasted per-pupil spending into the stratosphere. The Asbury Park district leads the way, spending an astounding $29,797 per student, according to the latest U.S. Census figures. Camden spends $23,356 per pupil, while Newark spends $21,895 and Jersey City $20,366. (Official New Jersey Department of Education spending figures are slightly lower because the court requires the state to exclude certain aid in reporting its education spending.)
The spending has depended, of course, on a massive redistribution of wealth, which has left many towns big losers. In Jersey these days, as in most states, even non-needy school districts get some funding from the state. But of the state’s nearly 600 municipalities, 166 get back ten cents or less for their schools for every dollar in income taxes that their residents send to Trenton, according to data compiled by state senator Mike Doherty. In 2010, three affluent towns—Millburn, Livingston, and Bernards—each sent more than $100 million in income taxes to Trenton, yet Millburn and Livingston got back no money for their schools, and Bernards got just $850,000. Middle-class towns do little better. East Rutherford, where the average household income is $64,500 (about $4,000 below the state average), gets only five cents of education aid for every income-tax dollar that it sends to the state.
The tens of billions of dollars spent on Abbott districts have yielded almost no significant educational gains. Last June, the National Assessment of Educational Progress (NAEP), whose tests are considered the gold standard in education assessment, issued a study of Hispanic and white scores in math and reading. The study showed that the gap in combined scores between whites and Hispanics remained about the same in Jersey—where about half of all minority students live in Abbott districts—as it was nationally. Among black students, according to a similar NAEP study from 2009, the lack of progress was even more pronounced. In fourth grade, the reading gap between whites and blacks was virtually the same in Jersey as in the nation as a whole; but by eighth grade, Jersey’s black kids were 31 points behind their white counterparts, compared with a 25-point gap nationally. Several years ago, the head of the Education Law Center essentially admitted the stunning failure of all the court-ordered spending, arguing that student performance on tests shouldn’t be the criterion for judging the effectiveness of the court’s actions.
The very communities that the New Jersey Supreme Court set out to help have grown frustrated with its simplistic, money-solves-everything approach. Several years ago, the Black Ministers’ Council of New Jersey, exasperated with many urban school districts’ resistance to education reforms, endorsed school vouchers for inner-city students. “For the 26 years I have been in New Jersey, there have been a host of public school reform proposals, a multitude of major state supreme court rulings, and billions of dollars spent to achieve parity and improve test scores,” the Reverend Reginald T. Jackson, the group’s executive director, said. “Yet the fact remains that with few exceptions, urban schools and most minority students still do not meet minimum state standards or receive a quality education.”
New Jersey’s constitution says nothing about affordable housing, but that hasn’t stopped the New Jersey Supreme Court from imposing a costly housing regime every bit as ambitious as its dictates on the schools. The housing mess began back in the early 1970s, when the NAACP sued Mount Laurel, charging that the town’s zoning laws—which set minimum lot and dwelling sizes for new residential construction—were illegal because they excluded the development of high-density, low-income housing.
In its 1975 ruling on the case, the court argued that affordable housing was essential to the general welfare of the Jersey population and therefore a necessary concern of government. “There cannot be the slightest doubt that shelter, along with food, are the most basic human needs,” the judges observed. Further, the fact that residents of similar wealth chose to live near one another—something that residents in most of the United States and, indeed, in almost every industrialized country choose to do—was evidence that municipalities were conspiring to keep lower-income people out, the court said. Municipalities therefore had to alter their zoning laws to ensure that they had a “fair share” of affordable housing—and that included small towns like Mount Laurel, which at the time had only 11,000 residents.
A few years later, the supreme court issued Mount Laurel II, a ruling that not only reaffirmed the “fair share” principle but also required municipalities to use incentives—subsidies to developers and parcels of land specially set aside for the purpose—to guarantee that the housing got built. Then the court added a startling twist: a “builder’s remedy,” which empowered developers to sue towns to force them to comply with the affordable-housing decrees. A trial lawyer’s dream, the builder’s remedy swiftly became a nightmarish burden on communities. Within just two years of the decision, builders had launched housing lawsuits against 140 Jersey municipalities. Lawyers specializing in the housing cases helpfully created a website that listed towns for builders to sue. The lawsuits forced some municipalities to spend up to $1 million in legal fees trying to defend themselves.
An even worse consequence was the way the lawsuits transformed many towns forever—especially after further judicial rulings encouraged the construction not only of low-income units but of market-rate housing, too, some of the profits of which would be used to offset the costs of the subsidized housing. Quiet Jersey towns were remade into sprawling suburbs, whether residents wanted that or not. In West Windsor, a tiny township near Princeton, a lower court approved a massive 1,100-unit development after a builder sued under Mount Laurel II, increasing the number of residences in town by 15 percent. Builders used the courts to get a green light for a 450-unit development in Oakland, boosting the town’s residences by 10 percent. (A Jersey environmental group later singled out that development as the state’s worst example of suburban sprawl.) Yet more supreme court decisions ordered municipalities to increase their stock of affordable housing as employment grew, the idea being that people should live near their workplaces. This new construction sparked commercial development to serve the new residents, which generated even more housing requirements.
The court-driven frenzy of building has weighed heavily on towns and taxpayers. In 1991, the court ruled that towns couldn’t tax the subsidized housing units at the same rate as other residences in their communities; the towns then raised property taxes on existing residents to pay for the extra services necessitated by the new construction. After the population of rural Clinton, for example, sharply increased as a result of the court-ordered housing construction, property taxes there doubled.
Seeking to bring some certainty to the frenzy of housing lawsuits and zoning battles that the supreme court had unleashed, New Jersey created the Council on Affordable Housing (COAH) and told it to figure out how much affordable housing the state needed and what each locality’s “fair share” was. In 2002, COAH estimated that the court’s mandate had resulted in the construction of 45,000 units of affordable housing across the state. Not enough, the council concluded: 118,000 was the target number. COAH then set about determining every town’s “fair share” of that load, a task that has proved nearly as controversial as the builder’s remedy and has provoked more suits and countersuits. The estimated cost in new taxes to complete COAH’s affordable-housing goals: $10 billion. Small wonder that towns continue to contest the mandates.
The New Jersey Supreme Court hasn’t satisfied itself with imposing unbearable costs on Garden State taxpayers. It has also allowed Trenton to ignore restrictions that the state’s constitution places on borrowing and spending—essentially nullifying these protections against profligate government. In 1991, a Wisconsin Law Review article concluded that no other state court had gone as far in ignoring such protections. “The response of the New Jersey courts to that state’s constitutional debt limitations is easy to summarize: the New Jersey Supreme Court has effectively read the limitations out of the constitution,” the authors noted.
That tradition has continued into the new millennium. When the court ordered the state to spend all those billions to upgrade Abbott school facilities, the state didn’t get taxpayer approval to establish the independent authority that borrowed the money. A group headed by Bogota mayor Steven Lonegan sued, claiming that the move violated the state constitution’s requirement that voters sign off on government debt. The court ruled against the group in 2002, accepting the argument that the construction bonds weren’t covered by the constitutional requirement because they, unlike most state bonds, were guaranteed not by taxpayers but by the state legislature. Of course, that distinction is a fiction, since the legislature gets most of its money from those very taxpayers.
Two years later, Governor James McGreevey and the Democratic majority in the legislature decided to borrow nearly $2 billion to close the state’s budget deficit and finance a staggering 17 percent spending increase. Lonegan and Republican legislators sued to stop the debt raid, pointing out that the state constitution unambiguously banned government borrowing to pay for everyday operating expenses. The court acknowledged that the plan was unconstitutional—but then let it go forward because it didn’t want a “disruption” in state government.
The supreme court’s spending mandates have left taxpayers in Jersey groaning under the nation’s highest tax burden: more than 12 percent of income produced there goes to state and local taxes, according to the Washington-based Tax Foundation. Residents’ income taxes pay for court-ordered spending in far-off urban school systems, as well as for a state government that, thanks to the court, is untrammeled by constitutional limits on spending. Meanwhile, the property taxes that residents pay to finance their own school systems and local government must rise to pay for the court’s local housing schemes.
Jerseyites have slowly come to understand the price that they’ve paid for America’s most activist court. A 2009 survey by the Polling Company, Inc. found that only 28 percent of the state’s voters gave the court a favorable rating. “If the members of the Supreme Court want to legislate, then they have the right, like every other citizen, to run for the Legislature,” state senator Doherty wrote in an op-ed for Newark’s Star-Ledger last May. “In doing so, they can place their agenda before the voters and the voters will decide. That’s democracy. What we have now is judicial tyranny.”
In at least two ways, the New Jersey Supreme Court will complicate Governor Christie’s battle to fix the state’s out-of-control spending habits. For one thing, the court probably will block some of the reforms that Christie wants—such as a revamped distribution of state education aid in which every school district would get the same dollar amount per pupil, a change that would fund essential services in poorer districts without bankrupting middle-income taxpayers. Christie also wants an affordable-housing regime that concentrates building in areas of the state with the preexisting infrastructure—mass transit, for example—that can support the new housing, another reform that the court is likely to stymie.
Second, the court will make it harder for Republicans, who tend to support Christie’s fiscal reforms, to win control of Jersey’s legislature. That’s because legislative redistricting in the state, which takes place every ten years, is handled by a bipartisan commission of Republicans and Democrats who are frequently deadlocked. The chief justice of the New Jersey Supreme Court gets to select a person to break the deadlock, and in 2001 and 2011, he selected a Rutgers University professor who sided with the Democrats. As the New York Times observed, redistricting ten years ago was crucial to the Democrats’ seizing control of the state legislature, while last year’s redistricting helped them maintain legislative control despite Christie’s personal popularity.
The obvious solution is to reform the court itself, but that won’t be easy, as Christie has already learned. Judges serve an initial seven-year term and then routinely get reappointed for a term that lasts until the mandatory retirement age of 70. In 2010, Christie tried to shake up the court by not reappointing Justice John E. Wallace, Jr., whose initial seven years had run out. The state senate, under Democratic control, refused even to consider voting on the replacement suggested by the governor—well-regarded lawyer Anne Patterson—and left a vacancy in the court. The press, meanwhile, claimed that Christie was trying to politicize the judiciary: the New York Times denounced his decision not to reappoint Wallace as a “national disgrace,” while the Philadelphia Inquirer called it an “error in judgment” and the Star-Ledger claimed that Christie had “cast a shadow” on the court. Only later, when another justice, Roberto Rivera-Soto, stepped down, did the senate confirm Patterson.
This year, Wallace and another justice will turn 70, giving Christie two more appointments. In January, Christie nominated to the court Bruce Harris, a Republican African-American mayor of Chatham Borough, an affluent suburban town, and a former lawyer at the same firm where Patterson served. Christie also tapped Phil Kwon, a Korean immigrant who worked under the governor when he was the U.S. attorney for New Jersey. Neither nominee has served on the bench previously, so they have no record of decisions, but Christie said that he was intent on appointing judges who would interpret the law, not legislate from the bench. He’ll still have to take into consideration a Democrat-controlled legislature that’s often happy to dodge responsibility for heavy spending by letting the court mandate it.
One thing is clear: somehow, New Jersey needs to rein in its judiciary if it hopes to get its house in order. The state will never be able to solve its fiscal problems until its highest court sticks to interpreting the law, not inventing it.
Steven Malanga is the senior editor of City Journal and a senior fellow at the Manhattan Institute.
Planned Parenthood Reaches Out to Small Children
What’s next for the lavishly taxpayer-subsidized baby-killing degenerates of Planned Parenthood, after corrupting the Girl Scouts? Maybe they will move into children’s cartoons. This bizarre and sadistic video they made in 2005 to promote abortion gives them a head start:
This is what Saturday morning cartoons will soon look like if liberals keep winning the Culture War.
h/t Moonbattery
This is what Saturday morning cartoons will soon look like if liberals keep winning the Culture War.
h/t Moonbattery
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