Master of the Senate, the third volume of Robert Caro’s biography of Lyndon Johnson, opens with a lengthy history of the world’s greatest deliberative body from America’s founding up to Johnson’s time. On page 44, describing the end of a lengthy period of Senatorial stagnation in the early 20th century, Caro writes about how leadership deliberated:
The “Senate Four” or the “Big Four,” as they were known, still met in summer at Aldrich’s great castle in Narragansett, near Newport – four aging men in stiff high white collars and dark suits (Aldrich, being at home, might occasionally unbend to wear a blazer) even on the hottest days, sitting on a colonnaded porch in rockers and wicker chairs deciding Republican policy – a policy that was still based on an unshaken belief in laissez-faire and the protective tariff.
Caro is a masterful biographer and a fine writer, but he is sometimes a little confused on economics. Protective tariffs are government interventions in the market, and therefore the precise opposite of laissez-faire. Then, as now, Republican leaders were much more pro-business than pro-market. This is an important distinction to make. Failing to make it can lead to egregious — and avoidable — errors.
The Senate just passed an $18 billion spending bill. Since the House already passed it, the legislation is now headed to President Obama’s desk to await his signature and become law.
The hope is that the spending will create jobs. If you’re reading this blog, then you probably know enough about economics to know that isn’t what will actually happen. Remember: anything that Washington giveth, it must first taketh away from somewhere else. It’s a zero-sum game. All those new jobs that politicians will be touting for the cameras will have come at the expense of other jobs elsewhere. On net, they’re not creating a thing.
Take the payroll tax break for small businesses that’s in the bill. Yes, those small businesses benefit. Maybe the money they save will even be used to hire more workers. That’s easy enough to see. But that money had to come from somewhere. That is harder to see. Too hard for the Senate to see, at the very least.
The reason is this: the government is foregoing some payroll tax revenue. But since it isn’t cutting spending to match, it has to borrow more. And there’s only so much investment capital to go around. Because Washington is borrowing more, less is left over for private investment opportunities. At the very least, companies will have to offer investors higher interest rates to lure them away from government bonds.
That makes getting loans more expensive. And when something gets more expensive, there tends to be less of it. Because of today’s bill, about $18 billion less capital will be available for the private sector to create jobs.
The legislation the Senate passed today is no jobs bill, at least on net. It is a spending bill. It doesn’t create jobs, it only redirects them.
Posted in Economics, Spending, Stimulus
Tagged barack obama, billions, creating jobs, Economics, jobs, jobs bill, jobs saved or created, obama, overspending, president barack obama, president obama, profligate spending, senate, spending, Stimulus, unemployment, us senate
If you’re gay, you can’t donate blood. It’s illegal. The ban was put in place in 1983, during the early days of the HIV/AIDS scare. It may have made some sense in those days, when HIV testing was less than trustworthy. But it sure doesn’t now, with modern screening technology.
Obviously, keeping HIV-positive blood out of circulation is a wise policy goal. But most gay people don’t have HIV/AIDS. Rather than screening donors for sexual preference, they should be screened for blood-borne diseases. Straight people already are. And it works quite well. Current policies are keeping healthy, willing donors out of the system.
The outdated ban could soon be coming to an end. Sen. John Kerry and 15 of his colleagues, usually more prone to passing regulations than repealing them, are urging the FDA to repeal this one. You can read their letter here.
The one disconcerting thing about the letter is that every single one of the signees is Democratic. Not one Republican joined in. That could be because Sen. Kerry and the others deliberately excluded them for political reasons. But the GOP is famously behind the curve on gay rights issues. So maybe Republicans were asked, and said no. I don’t know.
Republicans should send their own letter supporting Sen. Kerry’s position. Enlarging the pool of eligible blood donors is an unabashed good. It’s a classic gay rights issue. It’s also a health issue. Blood would be more readily available for patients who need it. Economists would add that increasing the supply of blood will lower its price – a good thing in this age of rapidly rising health care costs.
Posted in Economics, Health Care, Political Animals, Regulation of the Day
Tagged aids, blood donors, democrats, donating blood, fda, gay, gay rights, Health Care, hiv, hiv/aids, John Kerry, kerry, republicans, senate, Senator John Kerry
The House suspended votes for the rest of the week because of the impending snowstorm while the Senate may cancel votes on Wednesday.
The Republic is safe until at least Thursday.
Senator Tom Coburn offered several amendments to an appropriations bill yesterday. The most notable of these would have saved $454 million by cutting two dubious pork projects in Alaska. The fury Coburn aroused in his colleagues bordered on the absurd. Senator Patty Murray of Washington made threats to Coburn and anyone who voted with him. Senator Ted Stevens of Alaska actually threatened to resign on the Senate floor.
Keep in mind that, from the current $2.5 trillion federal budget, you need four decimal places before that $454 million even shows up.
The amendment failed by 15-82, a margin of 67 votes. The Senate can’t even bear to cut 0.02% of the federal budget without someone threatening to resign. Is it really that hard?
Grow up, children.
Excellent coverage of the whole fiasco is at The Club for Growth, The Daily Kos, and at National Journal.