More power for states could break federal deadlock

One of the lessons of the Ukraine affair is how difficult it is to put together a country composed of divergent groups.

For long periods, Russia dominated a country composed of both Ukrainians and Russians, and the current crisis is the result of the breakdown in Russian control in the face of Ukrainian opposition.

The result is likely to be a loose federal country with each group able to make its own decisions.  The eastern part of the country will lean toward Russia, and the rest will gravitate toward Europe.

All across Eastern Europe, countries have split into smaller states.  The Soviet Union composed of 15 “republics” yielded 15 separate countries.  For example, Estonia, Latvia, and Lithuania, once independent, recovered their freedom.

Czechoslovakia saw “the velvet revolution” result in a peaceful split between its two parts.  Yugoslavia totally splintered.

Even in Western Europe, Belgium, divided along language lines between French-speakers and Dutch-speakers, created a federation in which each side gained more independence.

In Great Britain, both Scotland and Wales have increased their autonomy and this fall, Scotland will vote on becoming a separate country, which would break a union with England dating from 1707.

Smaller countries not only allow people with similar backgrounds or interests to have their own government, but their reduced size makes it less likely they can drag others into a major war.

Of course, this is not a worldwide development.  China, the largest country, shows no sign of breaking up.  India, in second place, has large states with real power.

What about the United States?

This country has a balance between the states and the federal government, though Washington has gradually gained authority while states have less discretion than they did 200 years ago.

To some degree, that trend has been necessary to promote the growth of a strong national economy and to assure individual rights throughout the country.  But when Washington is divided by deep political differences, as we see now, the entire country suffers.

States have retained real powers.  They control education and compete with one another to attract industry and investment often through the use their tax laws and environmental requirements.

It’s tempting to think the political stalemate could be lessened if states were even more able to act.  That does not mean constitutional rights could be cut in some states or that interstate trade barriers could be built, but states seeking to innovate would not be limited by the need to find a national consensus.

Let’s take the example of health care.  The Affordable Care Act – Obamacare – turned out to be a complicated and controversial program, because Congress could not find a bipartisan compromise between a system run entirely by insurance companies and one run entirely by the government.

The result is a hybrid far less efficient and cost saving than had been the goal.  Could the states have done something different?

What if some states wanted to try the single payer system, while others wanted to stick with the traditional insurance model?  The federal government could have required that whatever the state system, it would cover virtually everybody.

A national system is not necessary to have successful program.  The Canadian single payer system was launched in a single province, Saskatchewan, which had fewer people than Maine.  When it worked there, it was extended to other provinces. 

States have been called “laboratories of democracy.”  The Supreme Court justice who came up with that phrase in 1932, explained, “a state may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country."

Maybe allowing states to play this kind of role, especially on controversial issues where federal action seems impossible, could be away around the prolonged deadlock in Washington.

States in a region could work together if they chose to do so.  The Constitution allows for interstate “compacts,” essentially treaties among the states.  Perhaps Congress could promote such accords, which it must approve.

Some states might choose to impose tougher environmental standards than the national minimum.  Or they could develop a regional energy policy in light of the failure of the federal government to come up with one.

Instead of a rush for federal tax cuts, there might be greater support for government funding if some of it were coming back to the states where the voters might exercise more control.

Maybe that kind of interstate competition would be healthy.  And maybe thinking regionally might get the engine of government working again.

“Rock star” economist attacks income gap

There’s a lot of talk these days about the income gap between the rich and the not-so-rich.  

At the top end, salaries and bonuses are measured in the tens of millions, while the minimum wage remains at $7.75 an hour, where it has been since 2000. 

Nowhere among advanced countries is the gap greater or growing faster than in the United States.  Reducing the gap is one reason for the drive to increase the minimum wage.

Some see a growing income gap as giving the wealthy economic and political power to dominate the lives of the rest of the population.  Such an outcome could undermine democracy and lead to bad decisions on matters ranging from the environment to health care, they say.

Along comes Thomas Piketty.  Chances are you have never heard of him, but he is one of the hottest thinkers around these days.  He’s a French economist with a rock star’s reputation.  He focuses on the increasing gap between the wealthiest and the poorest people.   

The income spread could be reduced by increasing pay at the bottom.  That could help, but Piketty’s best-selling book goes much further.

Because the wealthiest people receive incomes greater than they need for a good life, they save some of what they make.  Their savings go into investments producing even more wealth, gained without their having to put in any more work.

The rest of the people must live on their incomes, so have little or nothing to invest.  The result is their incomes grow slowly, dependent on pay raises and not much on income from investments.

After World War II, the gap between the wealthy and others declined in the United States, because of extremely high tax rates on those with high incomes.  They had less money available to make themselves wealthier.

But, since then, changes in tax rates have benefited the wealthiest people more than any other group.  While a considerable number of workers now mainly pay payroll taxes and little or no income tax, the amount of their tax relief is small compared to the cuts for the rich.

The top tax rate for the wealthy has fallen from 94 percent to 39.6 percent of their taxable income.

Piketty believes the income gap should be reduced and proposes two solutions.

You could reduce the gap between rich and poor, if you took away some of the wealth of the rich.  Piketty suggests a wealth tax, kicking in at about $1.4 million, should be levied.  By taking money away from the wealthy, you could reduce the gap and their clout.

What would be done with the revenues?  It could fund a higher minimum wage for the millions working for governments at all levels.  It could funnel more help to those at the bottom of the ladder. 

In short, Piketty’s wealth tax might lead to income redistribution.  In a country where virtually any government service may be branded as “socialist,” the American income gap is unlikely to be reduced by redistribution.

Money will not go from the investment accounts of the wealthiest into the paychecks of low-income workers.

The advocates of amassing great wealth say the wealthy will make investments in companies creating jobs for many others.  But those companies may create jobs in China or, through technology investment, reduce their need for labor.

Piketty’s alternative solution may be more practical.  He sees the wealthy also having more of a form of capital than the less fortunate – education.  In his ideal formula, higher taxes on wealth could fund greater access to education.

With more and better education, people could develop their own businesses or become qualified for new technological and higher paying jobs.  In other words, they would begin to have the kind of opportunities now more readily available to the rich and, in the process, reduce the income gap.

While the wealth tax idea is likely to go nowhere, at least in the United States, the proposal for improving education is both reasonable and possible.  And it pays off.  There’s plenty of proof that the better educated you are, the higher your income.

In some respects, this country is already moving on this point.  A high school education is no longer enough.  Community colleges are booming, because they produce graduates trained to meet the most current needs.  Maine’s are a great example of this.

With his wealth tax, Piketty may not understand how America works, but, with his emphasis on education, he does have a good idea about how to get America back to work.

“Who cares what the centrists think?” Politicians Should

Almost everybody who follows public affairs knows American government has been virtually immobilized by the deep division between conservative Republicans and liberal Democrats.

Conservatives believe the fault lies with the control over previous decades by big-spending Democrats.  Liberals believe the fault lies with obstructionist conservatives, who want to dismantle most government services.

These beliefs have deepened during the administrations of George W. Bush and Barack Obama, turning into self-fulfilling facts of political life.

Despite such attitudes, the supposed polarization has not prevented each side from gaining some of its major objectives.

Obama supporters point to health care reform.  Though many Republicans would like to repeal the Affordable Care Act, it has clearly begin to take root.  Repeal or even a broad revision is becoming increasingly unlikely as more people and insurers sign up.

Surveys show a majority want government action on climate change.  Recent Obama action to get the Environmental Protection Agency to limit emissions from coal-burning power plants is popular.

And, in the aftermath of the financial crisis, there have been some reforms intended to punish those responsible and make future collapse less likely.

On the other side, government spending has been reined in.  While it would be a good idea to have a federal budget, stopgap measures have provided some satisfaction to conservatives who believe government has been doing too much at too high a cost.

But there are some obvious problems that grow worse.

Congress formerly backed the president on foreign policy, because Americans believed we must present a single, unified position to the world.  Now, Republicans seek to dictate policy the minute a crisis emerges, and they second-guess each move by Obama on a daily basis.

No sooner did ISIS rebels challenge the Iraq government than some GOP leaders were calling for immediate military action.  The President was not given even a little room to consider an American response, before it became obvious that anything he proposed would be attacked.

While Obama does not project the kind of strong leadership style many Americans and even people elsewhere would like, he is entitled to a degree of deference he does not get.  The combination of his style and instant GOP opposition weakens the U.S. in the world.

Then, there is a policy failure on immigration reform.  Members of both parties accept the need to deal with the millions of illegal immigrants now in the country and new arrivals.

But House Republicans block the passage of any reform measures.  It’s obvious they believe a new immigration law would help the Democrats in the November elections.  So nothing happens.

It is possible the prolonged discussion about allowing the children of illegal immigrants now in the country to become citizens has served to encourage the new and sharply increased influx of Latino children now under way.  They have certainly been misled and given false hope.

And agreement on a badly needed comprehensive energy policy, dealing with both fossil fuels and renewable resources, is so remote it is not even discussed any longer.

Whether even more conservative and unyielding forces will gain power in the Republican Party is now an open question.  The elections this fall could provide a good indication of the answer.

Meanwhile, some liberals believe Obama can promote their agenda without GOP support.  That could turn out to be true only in the short run.

What about people in the middle?  The latest national NBC News-Wall Street Journal poll shows 39 percent consider themselves moderate, 36 percent conservative, and 22 percent liberal.  The rest don’t know.

The moderates say they want a government producing results based on compromises between the two sides.  That can yield more positive action, longer-lasting policies, and the image of a stronger country.

Liberal columnist Paul Krugman, who seems to think a well-deserved Nobel Prize in Economics makes him a sage on everything, writes: “Who cares what the centrists think?”  He is satisfied Obama is accomplishing some of his goals now and shrugs off the need for bipartisan policy mainly because he thinks the GOP makes it impossible.

Krugman fails to understand the purpose of a country governed on behalf of its people is action in line with popular sentiment.  It is not acceptable to sneer at those who want compromise.

Perhaps, as he believes, the conservatives will insist on their goals, even to the point of undermining government.  But the other side adopts the same tactics at its own risk, when it might win elections by pursuing bipartisan policies, however fruitless that effort in the short term.

Why did a crypto-Democrat endorse a GOP Senator?

In a politically unusual move, independent Sen. Angus King, who almost always lines up with the Democrats, endorsed Republican Sen. Susan Collins for re-election.

President George W. Bush labeled forecasting the political future based on today’s events as “punditry,” and King’s move was just the kind of tidbit pundits like.

While I make no claim to being a pundit, the endorsement stimulates some tantalizing speculation about Maine politics this year.  Not only is King-Collins worth a closer look, but so are other Maine campaigns.  But it’s little more than guesswork at this stage.

King endorsed Collins, providing her support she had not sought or almost certainly did not need.  He told Democratic candidate Shenna Bellows his endorsement was not “personal.”   Maybe not for Bellows, but quite personal for King.

An explanatory note for what follows.  The U.S. Senate is controlled by the majority party. The party “organizing” the Senate gets to name committee chairs and determine the flow of Senate business.

Right now, the Democrats control.  The sole GOP legislative power is to filibuster to prevent matters from coming to a vote.  And even that power has been cut, making it difficult to block most presidential nominations.

Independent King now backs Democratic control.  But the pundits say the GOP could well organize the Senate next year.  Does King’s endorsement mean he will change sides to keep prime committee slots?

He says that he will do what’s best for Maine.  Could anything be better to benefit his state than his keeping prime committee positions?

If the Democrats keep control, they may be less favorable to him simply because he endorsed a GOP senator.  No matter how much he tries to straddle the gap by pushing his independent status, he may find there’s a price to pay for such a strategy.

Collins looks sure to be re-elected.  Does the King endorsement hurt Bellows?

Like many endorsements, it may not matter much except to the person making the endorsement.  Already the underdog, one might wonder if Bellows is even discouraged.   

Why is she running in such a difficult race?

If she already recognizes how difficult it would be to win, perhaps gaining recognition and respectability will help her in another race for another office later on.  That’s what Collins did when she finished third in the governor’s race.

Is there anything Bellows can do this time around?  Instead of trying to defeat Collins on the issues, maybe she should find a single issue, keep hammering it, and become identified with it. 

The key issue could be that Collins, considered a moderate, helps give Senate control to the GOP and supports most filibusters, thus empowering fellow Republicans far more conservative than she is.

As for King’s endorsements, he’s not finished yet.  He seems likely to endorse Eliot Cutler, candidate for governor and like him an independent leaning toward the Democrats.

Cutler thought about running as an independent for the Senate seat King eventually won.  Instead, he endorsed King, who probably gained access to Cutler’s supporters list.  Repaying the favor, King would endorse Cutler and return to him an updated list.

Looking at the governor’s race itself, we are continually reminded that Paul LePage won only because the opposition vote was split between Cutler and the Democrat.  Supporters of either of them have almost certainly learned their lesson.

That means the anti-LePage voters will recall 2010 and begin to rally around either Democrat Mike Michaud or Cutler.  Once the flow starts toward one of them, it should keep on going. 

Which way?  Who knows, but having won repeatedly in the Second Congressional District, Michaud has political money in the bank.  Cutler will presumably press hard to win big in the seemingly more liberal First District.

The Second District race, to fill the seat left vacant by Michaud, has primary contests in both parties.  The candidates in each party probably wouldn’t differ much from one another if they got to the House of Representatives.

But in the GOP, candidate Bruce Poliquin is trying hard to show he is more conservative than Kevin Raye.  In the Democratic race, candidate Emily Cain is trying hard to show she is more liberal than Troy Jackson.

The outcome of those primaries and the ensuing general election may end up telling Mainers a lot about the political complexion of their state. 

One thing worth noting.  It’s at least theoretically possible that, when the electoral dust settles, women could hold three of Maine’s four federal offices.

 
Remember, though, this is all just guesswork, not punditry.