Friday, August 25, 2017

Trump continues campaigning; only Congress can save his presidency

The government seems to be operating without a president. Senate Majority Leader Mitch McConnell, a Republican like President Trump, questions if his presidency can be saved.
The 2016 campaign continues. Trump attacks Republicans, Democrats, and the media. He implies that he has no “moral” concern about Nazi and white supremacist demonstrators. If Democrats won’t support Americans paying for the border wall, not Mexico, he will shut down the government.
As president, he offers rhetoric, not substantive proposals. He attacks Congress, creating opponents whose support he needs. He has a freer hand in international affairs than on domestic policy, but often confuses and bewilders allies and adversaries. The generals running the government must correct his statements.
After his deeply divisive remarks on Charlottesville and his collapsing poll numbers, his scripted speech on Afghanistan, where he promised, “we will win,” may have been an attempt to appear more presidential. But he reverted to form with the Phoenix rally.
He appears to believe tax reform is his silver bullet. “This is our moment,” he says. He hopes to unite Republicans and Democrats, bring back the disaffected business community and send the stock market to new heights.
Called tax reform, it is mainly a tax cut for everybody, which should be widely popular. The prospect of tax reductions originally attracted business leaders and was the basis of the Trump bump in the stock market.
A couple of aspects of tax “reform” are certain. First, everybody, from the lowest income fifth to the wealthiest tenth, will have their income taxes reduced.
The wall-to-wall tax reduction is what Trump expects should produce sufficient congressional majorities. In theory, the GOP will get behind the cut, and Democrats could have a hard time opposing it.
Just who gets most of the tax cut may prove to be the problem with this theory. The Democrats favor a tax increase on those with incomes in the top one percent, but the Trump proposal is slated to give them the biggest reduction.
This is where the idea of tax reform departs from tax reduction. While there may be cuts for all, reform is meant to benefit the rich.
Some loopholes may be closed, but lower rates and eliminating the inheritance tax on people who leave more than about $10 million will be a boon to the most wealthy. The tax breaks for the wealthiest may be what limits Democratic support.
The second key aspect of the tax proposal is that the federal government will receive less revenue. That’s the GOP’s intention, and it means deep cuts in government services.
The federal budget has three parts. The largest is required support for programs like Social Security, Medicare and Medicaid. The remainder, about one-third of outlays, has been evenly split between defense and all non-defense spending. Trump wants to end equal treatment, boosting defense and slashing the rest.
While that may be conservative policy, it fails to take into account the people whose services will be cut. That was the lesson of “repeal and replace Obamacare.” So many people would have lost coverage that some legislators could not support outright repeal.
Much the same would be true with cuts on programs from agriculture to the arts, many created by members of Congress responding to their constituents. It may be difficult for them to sell tax cuts for the rich financed by reductions in services to voters.
As for the conduct of his presidency, it’s not clear that Trump grasps all of this. He has shown little interest in the substance of policies, and looks for political wins that he can claim for himself. He relishes the cheers of his dwindling core supporters more than the details of governing.
He congratulates himself for creating one million jobs in the first half of the year. That’s exactly the job growth under President Obama in the same period last year. Trump counts the gain for himself but not for the president whose legacy he would destroy.
Without tax reform success and governing as if the presidency is really a continuing political campaign, Trump could find it difficult to achieve success with any domestic policy proposals. A solution must be found elsewhere or government will remain stalled.
If a reluctant McConnell and House Speaker Ryan would compromise with Democrats, moderate, veto-proof bills could be passed. Trump could take the credit for them. As with the nearly unanimously passed bill keeping sanctions on Russia, a bipartisan approach could reduce the risks of a Trump foreign policy.
In short, Congress might be able to save the Trump presidency.

Friday, August 18, 2017

GOP conservatives forced to confront Trump’s “base”

The white nationalist rally in Charlottesville, Va. provides strong evidence of the widening division in American politics.
President Trump’s reaction shows a new stage in the rightward evolution of the Republican Party, one rejected by many GOP leaders.
He would not single out the far right demonstrators for responsibility, even after one of them had killed a woman. Two days later, he read a prepared statement criticizing white supremacists, only to revert to assigning equal blame to racists and their angry opponents.
The GOP has evolved from Lincoln’s war to defeat slave state rebellion to a party led by a president giving comfort to racism. After the Civil War, the GOP became the dominant party. Its platform favored business, while keeping government small and workers under control.
The Great Depression of 1929, the deepest economic crash, revealed the limits of Republican policy. With Franklin D. Roosevelt’s New Deal and a larger role for government, it lost its dominance.
Sen. Susan Collins remains loyal to many of the values of the traditional, pro-business Republican Party, while accepting the need for change. In her views, voters can see a mix of conservatism and practical concern for the less fortunate.
But the party came under the influence of leaders exploiting social issues and opposition to gun control. Under President Ronald Reagan, the party moved to the right. The 1994 congressional elections brought a disciplined and strongly conservative GOP to power in Congress.
The GOP has been tightening its grip on power through the successful use of tactics designed to suppress Democratic voting. Traditional Republicans have been increasingly challenged by strong conservatives, some of them participants in the Tea Party movement, and the elected face of the party became more conservative.
Social conservatives, most of whom would pare government back to little more than national defense, came to dominate the GOP. To them, Collins, though a lifelong party member, is seen as a Rino – a Republican in name only. They now own the brand name, not her,
Trump’s election represented the next step in the rightward evolution of the party. His anti-Mexican, anti-Muslim, anti-“politically correct” rhetoric made some on the far right, who had remained outside the world of politics, believe they now had a one of their own as president.
They suddenly feel free to express and act on their views. Believing them part of his political “base,” Trump seems reluctant to reject their overt and extreme racism. Hence, the Charlottesville rally and Trump’s reaction, applauded by right-wingers promoting white supremacy.
The reaction of elected Republican conservatives suggests that, while the party may have shifted to the right and chosen to emphasize wedge social issues, the party is not ready to embrace racist elements even for their votes.
Still, today’s Republican Party is deeply conservative on a broad range of issues. Because its electoral success appears to be based on a combination of traditional GOP support and the newly self-confident hard right, it is reluctant to compromise with Democrats.
The Democrats run the risk of insisting on a similar degree of strict adherence to a set of principles enforced by real party discipline.
Supporters of Sen. Bernie Sanders may legitimately feel their man would have won the presidential election if he had overcome the Clinton forces control of the Democratic Party. The party had not been neutral and had lost. Now, some Bernie activists want to purge the party’s traditional supporters, whom they see as discredited.
A key to the Democrats’ historic strength has been its openness to a wide range of views. Roosevelt transformed his party’s traditional reliance on the South into a broad coalition including northern liberals. Eventually that combination would break apart after southern conservatives moved to the GOP.

The 2018 congressional elections will be a test to see if conservative Republicanism, in which Trump welcomes extremists, will be sustained or rejected. But the Democrats must do more than merely stand by the pick up the pieces.

The 2020 presidential election may show if progressive Democrats accept the need for a “big umbrella” more than the creation of an uncompromising, ideologically pure party. It may also reveal if the GOP recovers its traditional conservatism or continues its drift to the hard right.

For many people, what is of greatest importance is not the triumph of a party or a political philosophy, no matter how correct it may seem, but whether the political divide has become impossible to close, making compromise impossible.

The survival of the American system of government, operating in a vast and diverse country, depends on compromise.

Friday, August 11, 2017

Electric bills hide costly government policies

Electric bills hide turmoil in the electric industry.
Some recent events illustrate the point. The Maine Legislature sustained Gov. LePage’s veto of solar power subsidies. Renewable subsidies are pushing up costs. New transmission lines are raising rates. Major Canadian hydro projects, hoping for U.S. markets, experience runaway costs
Policy decisions contribute to hidden increases in the price of power. In short, the electric bill pays for more than economical, reliable power.
Back in 1993, Congress remodeled the industry. Formerly, utilities owned both power generators and all the wires, used to serve captive customers. Then Congress ruled transmission lines had to carry any producers’ power, not just that from the line-owners.
In many states, including Maine, utilities were forced to sell off their generators, becoming solely wires companies. The risk of costly, faulty power supply decisions was moved from their customers to independent power suppliers.
The goal was competition among suppliers in a reasonably open market. That worked and the customer’s cost of power may have fallen by about one-third, particularly for those sticking with the standard or default offer.
That’s the good news. The not-so-good news was that the cost of wires just about doubled, allowing the traditional utilities to thrive with little risk.
Wires costs rose because utilities convinced regulators that their transmission lines were old and needed replacement, not always the case.
Siting of new generators also boosted costs. Traditionally, to keep transmission costs low, generators were located close to big markets. But such siting became increasingly difficult.
Some thought that cheap power could be imported from Canada, avoiding siting problems. But that power wouldn’t be any less costly than prices set in the U.S. market where it would be sold. And production costs in Canada are rising.
Public policy encourages renewable resources like hydro, solar and wind. Costly lines from new, distant generators to urban customers may be necessary. That could be the result of recent proposals to generate power in Maine for use in Massachusetts.
But government ordered regulators to go even further. Renewable power could be expensive to produce, slowing its development. Regulators were required to build subsidies into electric rates to allow renewables to appear to be competitive with traditional fuels like coal and oil.
Higher costs paid by today’s customers would supposedly produce cleaner and less costly power for tomorrow’s customers. That’s been promised for decades with dubious results.
Regulators forecast future electricity costs and then price renewables in line with their predictions. The problem is they usually get their forecasts wrong. For example, today’s natural gas prices are far below what they foresaw. Plus, there are new wires costs.
Customers pay a premium price to subsidize renewables without gaining an immediate economic benefit. That’s a real problem for Maine, the poorest state in New England and one struggling to attract new industry.
When the Legislature fell short of the votes to override Gov. LePage’s veto of solar subsidies, it aided customers. The veto may have slowed solar development from becoming competitive and improving the state’s energy mix, but it kept the subsidy’s direct and indirect effects out of current rates.
Renewables deserve public support, but why should today’s customers be forced to pay the subsidy? If regulators were limited to setting rates only for reliable service, legislators could set public policy and subsidize renewables with tax revenues, not rates. Trying to finance subsidies by taxes could reveal if voters favor such support.
By shifting subsidies into electric rates, government levies hidden taxes. It’s public policy without public responsibility. But it can hurt low-income customers and discourage some industries from locating in a high-cost market. On this one, LePage is correct.
Utilities will soon face paying the costs of underused utility lines, as more local resources are developed to serve local users. That’s called “distributed generation,” and it is likely the wave of the future. With improved batteries and other power storage, smaller local solar and wind mini-grids will be possible.
Utilities may stop growing, if new lines are not needed. While they will be allowed to cover their costs, their profits might suffer. They will expect customers to cover expected profits.
The solution could be to allow utilities to become developers of small-scale, renewable generators. Waning profits from big wires projects could be gradually offset by local power systems.
The cost of electricity reflects policy decisions about what resources we use, where they are located and what we pay for them. The monthly bill hides all that.
(Disclosure: I was Maine’s first Public Advocate and headed the state energy office.)

Friday, August 4, 2017

One party control is not working

Political battles in Washington reveal the sad state of governing.
Traditional pragmatism has been replaced by strict partisanship. Checks and balances are threatened.
Partisanship – “It’s my way or the highway” – has replaced the pragmatic style of government. Our tradition has been to find practical solutions to clear public needs.
Is there no role for partisanship, but always middle-of-the-road compromise?
As one of today’s popular sayings notes, “Elections have results.” Voters may give one side the controlling hand in government, so the views of that party have a right to dominate the results. But dominating to the exclusion of the other party doesn’t work.
Take the Affordable Care Act, a name not used by opponents who insist on calling it Obamacare. It was adopted by Congress when both houses were controlled by Democrats and Barack Obama was in the White House. Not a single Republicans voted for it.
Even worse, Senate Democrats used a legislative maneuver called “reconciliation” when they no longer had the 60 senators needed to block a filibuster. Reconciliation allowed them to dodge the filibuster that could kill the bill.
This year, congressional Republicans ran the Democratic tactics through the copier. They wanted to pass a “repeal and replace” bill through filibuster-proof reconciliation without a single Democratic vote.
The Democrats had adopted a health care policy extending coverage to millions of people, financed by tax increases on the wealthy. By excluding most GOP suggestions and hence their votes, the Dems paved the way for a later Republican attempt to cut the coverage and the taxes.
Because the Republicans had done a far better job in attacking the ACA than Obama did in selling it, the GOP could reasonably expect it would be easy to defeat. They failed to reckon with the millions of newly covered people who came to like the ACA.
The only likely solution will be to repair the inefficiencies of the ACA and keep its costs under control. Members of both parties have put forth good reform ideas. Right now, GOP congressional leadership still rules out cooperating with the Democrats. It’s a matter of partisanship over pragmatism.
The president and Congress have historically found ways of working together. In the case of health care, the White House might have taken the lead, laying out its proposals. Instead, President Trump, lacking a proposal of his own, has been willing to sign anything the GOP can pass and then claim victory.
Trump has little apparent regard for Congress and little understanding of the legislative system. On health care, he has attacked Republican members of Congress, whose support will be essential on other issues. Short on substance but strong on salesmanship, he is losing support of what is supposed to be his party.
This split could not be more obvious than in the nearly unanimous congressional vote to impose sanctions on Russia for its role in the 2016 elections, its takeover of Crimea and its support of Syria’s dictator.
Russia’s involvement in the elections was meant to help Trump in the hope he would allow it a freer hand in the world. He seemed eager to accommodate Russia’s President Putin, and contrary to sound evidence, questioned whether Russia had tried to influence the election.
While Trump may have worried about the effect of Russian involvement on the legitimacy of his victory, Congress focused on combating increased Russian aggressiveness. The new, veto-proof bill was aimed more at taming Trump than at punishing Russia.
The Russia confrontation between Congress and Trump illustrates another fundamental element of the political system, now under pressure. A central part of the American political experiment is the concept of checks and balances, allowing one part of the government to limit another.
That means the president is subject to congressional checks and does not have an unfettered right to set policy. He is commander-in-chief of the Armed Forces, not of the government or of the country.
Trump seems to think his electoral victory represented a mandate for the government to give him complete loyalty. In effect, he expects Congress to make good on his election promises. As president, he expects loyalty to flow toward him, though he owes none to Congress.
Like Trump, congressional Republicans promised to repeal the ACA. Their leaders insist that, above all, they must keep their promise even if that might cost them votes.
The run-up to the 2018 congressional elections and their outcome may reveal if most voters believe practical solutions of major issues are more important than keeping campaign promises.
Can practical solutions beat hard-line partisanship?