As featured on p. 218 of "Bloggers on the Bus," under the name "a MyDD blogger."

Tuesday, March 17, 2009

The Sanford-ization of the Yacht Party

The federal stimulus package would offer two years' worth of money to cover expanded unemployment insurance for the states if they agree to change eligibility rules governing who can receive benefits. This is sound public policy to use federal money as a lever to make these changes, because America is a terrible place to lose your job under current law. Most people don't qualify for unemployment insurance, the benefit is stingy, and economic downturns become nightmares because of the lack of automatic stabilizers and a social safety net. So anything to encourage change to this system is positive. Not to mention the fact that giving money to people that will spend it has a high multiplier, making unemployment benefit expansion very good stimulus. Even extending the benefit by 20 weeks, which the Assembly proposed yesterday, is solid stimulus, and the money would come entirely from the federal government, making it essentially a free chance to boost the economy.

So of course, the Yacht Party wants to block it.

Republican lawmakers on Monday rejected the state's first federal stimulus-related bill to extend unemployment benefits by 20 weeks.

The bill, which fell short by one vote in the Assembly, would have pulled as much as $3 billion from the federal government. Lawmakers were expected to take up the bill again soon.

A second bill to ease eligibility was passed on a simple majority and will move along a slower legislative track.

Democrats accused Republicans of hampering California's economic recovery efforts by refusing to support a no-brainer bill to draw billions of dollars from the federal government.

"Talk about job killing," said Assemblywoman Mary Salas, D-Chula Vista. "Say no to this and you're really hurting the business community."

With respect to the "second bill," the Yacht Party argument is that expanding eligibility will eventually increase the tax burden on businesses to pay for the new eligibility expansion come 2012. But if no legislation passes by July 1, California will leave as much as $3.8 BILLION dollars on the table that could go to people who will jump-start consumer spending in their communities, saving jobs among small businesses in the retail sector. In other words, worrying about marginal tax increases in three years comes at the cost of losing jobs and destroying businesses right now.

This is what Governors throughout the South are doing, putting the interests of their ideology ahead of the public at large. It's the Sanford-ization of the Yacht Party. And sadly enough, they don't even have the courage of their convictions. The final vote on the bill was 53-9. 18 Yacht Party cowards took a walk rather than recording a vote against giving people an extension of unemployment benefits.

And to pick up a earlier argument, the reason this bill can be subject to a conservative veto, at least with expanding eligibility, is that it would raise business taxes eventually. This has nothing to do with any budget resolutions. So changing the two-thirds requirement on the budget without a concurrent repeal of two-thirds on taxes would leave you in the same position with respect to this bill. Furthermore, Yacht Party members will characterize a 2/3 change on the budget as a prelude to tax increases anyway.

Politicians in Sacramento have suggested watering down Proposition 13 by eliminating the two-thirds voting requirement for passing a budget bill. In fact, Assembly Speaker Karen Bass and Senate President Pro Tem Darrell Steinberg said this even as they passed the largest tax increases in California’s history.

Make no mistake about it: if we had weakened Prop 13 and made it easier to raise taxes this most recent budget would have hiked taxes higher on all Californians while preserving even more wasteful government spending.

This is gobbledygook logic, which combines Prop. 13 provisions on taxes with the 2/3 rule on the budget. But that would be the argument from the opposition. You can either point out that "no, we don't want to change the tax rule," adopting a purely defensive position, or you can argue "Yes, California is worth paying for, and denying poor people food or health care is abhorrent and we have to find solutions without putting the least of society at risk," adopting an offensive position.

The consequences of the former can be seen in this debate - leaving free money on the table because of the conservative veto.

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