From Obamacare to Ryancare to Don’t Care and maybe Trumpcare


March 15, 2017

From Obamacare to Ryancare to Don’t Care  and maybe Trumpcare

Twenty-Four Million Reasons the G.O.P. Health-Care Bill Is No Good

 By John Cassidy
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Is Ryancare the alternative to Obamacare?

For days, the political world had been waiting nervously for the Congressional Budget Office (CBO) ’s assessment of the House Republicans’ Trump-endorsed proposal to replace Obamacare. On Monday afternoon, when the numbers-heavy report finally appeared, one figure it contained dominated all the others: twenty-four million.

This was the C.B.O.’s estimate of how many fewer people would have health insurance if the Republican legislation—which is called the American Health Care Act—passes. In 2018, the first year that many of the bill’s changes would go into effect, fourteen million “more people would be uninsured under the legislation than under current law,” the report said. The difference “would rise to 21 million in 2020 and then to 24 million in 2026.”

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By anybody’s terms, twenty-four million is a lot of people. It is far larger than the fifteen million that two economists from the Brookings Institution had suggested last week that the C.B.O. might come up with. “To put the 24 million coverage loss in perspective, that reverses the entire coverage gain from the ACA,” one of the Brookings economists, Loren Adler, said Monday on Twitter.

As recently as January, Trump was promising that his Administration would provide “insurance for everybody.” Even for a President whose acquaintanceship with the truth is a casual one, explaining away the figures in the C.B.O. report could be tricky. It was not surprising, therefore, that the White House quickly dispatched Tom Price, the new Secretary of Health and Human Services, to rubbish the C.B.O. analysis. “We disagree strenuously” with the coverage estimates in the report, Price told reporters at the White House. Price insisted that the G.O.P. plan would “cover more individuals at a lower cost.”

Price didn’t provide any numbers to back up this claim. He hasn’t got any. (In fact, on Monday night, Politico reported that the White House’s own internal analysis of the health-care bill projected that twenty-six million fewer people would have coverage over the next decade.) The only thing that the Administration and its allies on Capitol Hill have to fall back on is the vague promise to follow up the A.H.C.A. with a second piece of legislation that would give insurers more freedom to offer cheaper, lower-quality plans, which, in turn, might persuade more young and healthy people to sign up. But that’s a pie-in-the-sky promise. Changing the rules for insurers would require sixty votes in the Senate, which the Republicans don’t have.

The C.B.O. analysis didn’t account for the possibility of insurers being able to offer cheap and lousy plans. The main thing driving its conclusions wasn’t changes to the individual market but the House Republicans’ reckless and deliberate assault on Medicaid, the federal program that provides health care for the poverty-stricken and the working poor. In estimating that twenty-four million people stand to lose their insurance coverage, the C.B.O. said that fourteen million of this total would be accounted for by reductions in Medicaid rolls.

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Any Hope for Trumpcare?

It is important to understand how this estimate was arrived at, and why it is reasonable. Under the Affordable Care Act, the federal government lifted the income threshold for Medicaid eligibility to nearly a hundred and forty per cent of the poverty line. At the same time, Washington also promised states, which administer Medicaid, that it would pay ninety per cent of any costs entailed in this expansion. Thirty-one states, including sixteen that now have Republican governors, took the feds up on this offer. The G.O.P. bill would end the Medicaid expansion in 2020—sooner, possibly, if the White House accedes to demands from ultra-conservative groups. The legislation would also change the way the rest of the Medicaid system is financed, shifting to a “block grant” model in which Washington would pay a fixed amount to the states for each recipient.

As a result of these changes, the C.B.O. report said that “some states would discontinue their expansion of eligibility, some states that would have expanded eligibility in the future would choose not to do so, and per-enrollee pending in the program would be capped.” The end result would be a big drop in enrollment and also a big drop in spending—eight hundred and eighty billion dollars over ten years. “By 2026, Medicaid spending would be about 25 percent less than what CBO projects under current law,” the report says.

The drop in spending on Medicaid helps explain why the C.B.O. estimated that the G.O.P. reform would reduce the deficit by three hundred and thirty-seven billion dollars—a fact that some Republicans seized upon. But why, you might ask, would the deficit be reduced by just three hundred and thirty-seven billion dollars over ten years when spending on Medicaid would fall by eight hundred and eighty billion dollars? The answer is that the bill would take most of the money that is saved from reducing Medicaid and hand it out to rich people in the form of tax cuts. The legislation would abolish the 3.8-per-cent Medicare tax on investment income and the 0.9-per-cent surtax on ordinary income that the A.C.A. applied to people who make more than two hundred and fifty thousand dollars a year. According to the C.B.O., getting rid of these taxes and some annual fees that the A.C.A. imposed on insurers would reduce revenues by five hundred and ninety-two billion dollars over ten years.

If the Republicans really wanted to fulfill Trump’s promise of insuring everybody—or, at least, preventing a big fall in insurance rates—they could have taken the five hundred and ninety-two billion dollars and used them to maintain the Medicaid expansion. Or to enlarge the new tax credits they want to offer for the purchase of individual insurance, which, in some cases, would be much smaller than the subsidies offered under Obamacare.

And I mean much smaller. In a table at the end of its report, the C.B.O. provided some “illustrative examples” of how different types of people might fare under the new system. Take a single sixty-four-year-old with an annual income of twenty-six thousand five hundred dollars. Under Obamacare, after receiving a generous federal subsidy, this person would pay seventeen hundred dollars in annual premiums. Under Trumpcare, or Ryancare, or whatever we want to call it, this person would pay fourteen thousand six hundred dollars. That’s an increase of twelve thousand nine hundred dollars!

To be sure, the way the new system would be set up, not everybody would be a loser. For example, a single forty-year-old with an annual income of sixty-eight thousand two hundred dollars could end up saving more than four thousand dollars a year, according to the C.B.O.’s figures. But, in general, people would pay more, at least in the early years after the measure goes into effect.

In the first few years, as some healthy young people drop their insurance plans because they are no longer mandated to purchase them, premiums would go up fifteen or twenty per cent, the report says. After 2020, average premiums could start dropping, and by 2026 the C.B.O. projects they would be ten per cent lower than under the current law. But that would mainly be because insurers would be offering cheaper, crappier plans to young people, and older people would be dropping insurance because they could no longer afford it. It will be interesting to see how Trump tries to sell that prospect to his supporters, many of whom are older and living on modest incomes.

John Cassidy has been a staff writer at The New Yorker since 1995. He also writes a column about politics, economics, and more for newyorker.com

When Facts don’t matter in America


March 13, 2017

When Facts don’t matter, Trump’s White House is the sole arbiter of truth.

by Paul Krugman@www.nytimes.com

Image result for Paul KrugmanDr. Paul Krugman-The Nobel Laureate in Economics

The U.S. economy added 10.3 million jobs during President Obama’s second term, or 214,000 a month. This brought the official unemployment rate below 5 percent, and a number of indicators suggested that by late last year we were fairly close to full employment. But Donald Trump insisted that the good news on jobs was “phony,” that America was actually suffering from mass unemployment.

Then came the first employment report of the Trump administration, which at 235,000 jobs added looked very much like a continuation of the previous trend. And the administration claimed credit: Job numbers, Mr. Trump’s press secretary declared, “may have been phony in the past, but it’s very real now.”

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Reporters laughed — and should be ashamed of themselves for doing so. For it really wasn’t a joke. America is now governed by a president and party that fundamentally don’t accept the idea that there are objective facts. Instead, they want everyone to accept that reality is whatever they say it is.

So we’re just supposed to believe the president if he says, falsely, that his inauguration crowd was the biggest ever; if he claims, ludicrously, that millions of votes were cast illegally for his opponent; if he insists, with no evidence, that his predecessor tapped his phones.

And it’s not just about serving one man’s vanity. If you want to see how this attitude can hurt millions of people, consider the state of play on health care reform.

Obamacare has led to a sharp decline in the number of Americans without health insurance. You can argue that the decline should have been even sharper, that there may be troubles ahead, or that we should have done better. But the reality of the law’s achievement shouldn’t be in question, and you should worry about the consequences of Trumpcare, which would drastically weaken key provisions.

Republicans, however, are in denial about recent gains. The president of the Heritage Foundation dismisses the positive effects of the Affordable Care Act as “fake news.” In Louisville over the weekend, Vice President Mike Pence declared that “Obamacare has failed the people of Kentucky” — this in a state where the percentage of people without insurance fell from 16.6 to 7 percent when the law went into effect. And as for the likely impacts of Trumpcare — well, they literally don’t want to know.

When Congress is considering major legislation, it normally waits for the Congressional Budget Office to “score” the proposal — to estimate its effects on revenues, outlays and other key targets. The budget office isn’t always right, but it has a very good track record compared with other forecasters; even more important, it has always been scrupulous about avoiding partisanship, and therefore acts as an important check on politically motivated wishful thinking.

But Republicans rammed Trumpcare through key committees, literally in the dead of night, without waiting for the C.B.O. score — and they have been pre-emptively denouncing the budget office, which is likely to find that the bill would cause millions to lose health coverage.

The truth is that while the office got some things wrong about health reform, on the whole it did pretty well at projecting the effects of a major new bill — and far better than the people now attacking it, who predicted disasters that never happened. And whatever criticisms one may have of its forthcoming score, it will surely be better than the ludicrous claim of Tom Price, the secretary of health and human services, that “nobody will be worse off financially” as a result of a plan that drastically cuts subsidies and raises premiums for millions of Americans.

But this isn’t really about whose analyses of health policy are most likely to get it right. It’s about Trump and company attacking the legitimacy of anyone who might question their assertions.

The C.B.O., in other words, is in the same position as the news media, which Mr. Trump has declared “enemies of the people” — not, whatever he may say, because they get things wrong, but because they dare to challenge him on anything.

“Enemy of the people” is, of course, a phrase historically associated with Stalin and other tyrants. This is no accident. Mr. Trump isn’t a dictator — not yet, anyway — but he clearly has totalitarian instincts.

And much, perhaps most, of his party is happy to go along, accepting even the most bizarre conspiracy theories. For example, a huge majority of Republicans believe Mr. Trump’s basically insane charges about being wiretapped by President Obama.

So don’t make the mistake of dismissing the assault on the Congressional Budget Office as some kind of technical dispute. It’s part of a much bigger struggle, in which what’s really at stake is whether ignorance is strength, whether the man in the White House is the sole arbiter of truth.

Healthcare Reform–Backing Paul Ryan’s handiwork


March 12, 2017

Healthcare ReformBacking Paul Ryan’s handiwork is a risky proposition for The White House and The Republicans

by John Cassidy*

http://www.newyorker.com/news/john-cassidy/exposed-donald-trumps-sham-populism?intcid=mod-lates

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Affordable Care Act- A Disaster or Trump’s Politics?

Kevin McCarthy, the Republican House Majority Leader, went on Sean Hannity’s show on Thursday night and tried to talk up the awful health-care bill that his party had just rushed through two committees. His message was aimed at the ultra-conservative groups, such as the Freedom Caucus and Heritage Action for America, that have come out strongly against the proposed legislation. McCarthy didn’t try to claim that the bill would make health care more affordable or widely available. Instead, he defended its conservative bona fides, twice pointing out that it would repeal all the taxes that were introduced under the Affordable Care Act—taxes that mainly hit the one per cent.

Hannity, who is one of President Trump’s biggest boosters, didn’t hide his loyalties or his concern about the political firestorm that the bill has set off. “This has to work: there is no option here,” he said at one point. Later, he warned, “As soon as it passes, you own it.”

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Message to Mr. Trump and the Republicans– It is not Obamacare, but Affordable Care Act

Intentionally or not, Hannity summed up the political dilemma facing Trump and his Administration. The White House has embraced Paul Ryan’s handiwork—the House Speaker is the bill’s top backer—and they are now trying together to persuade the full House and the Senate to vote for at least some version of it. But if the bill does pass and Trump signs it into law, what happens then? The health-care industry will be thrown into turmoil; many millions of Americans will lose their coverage; many others, including a lot of Trump voters (particularly elderly ones), will see their premiums rise sharply; and Trump will risk being just as closely associated with “Trumpcare” as Barack Obama was with Obamacare.

Two questions arise: Why did Ryan and his colleagues propose such a lemon? And why did Trump agree to throw his backing behind it?

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House Speaker Paul  Ryan–A Healthcare Reformer or just another Politician

The first question is easier to answer. For seven years, promising to get rid of Obamacare has been a rallying cry for Republicans on Capitol Hill—one supported by both Party leaders and activists, as well as by big donors, such as the Koch brothers. It was inevitable that, if the G.O.P. ever took power, it would move to fulfill this pledge, despite the human costs of doing so.

What wasn’t anticipated was that the Republican leadership would run into hostility from the right. But that, too, is explainable. After November’s election, Ryan and his colleagues were forced to face the reality that fully repealing the A.C.A. would require sixty votes in the Senate, which wasn’t achievable. Many of the things that ultra-conservatives see as shortcomings in the bill now being considered—such as the retention of rules dictating what sorts of policies insurers can offer—are in there to make sure that the Senate can pass the bill as part of the budget-reconciliation process, which requires just fifty-one votes. As McCarthy explained to Hannity, “The challenge is the process of how we have to do this.”

The more interesting question is why Trump would stake his credibility on such a deeply regressive, and potentially unpopular, proposal. During the campaign, he frequently promised to repeal Obamacare—but it wasn’t one of his main issues. Clamping down on immigration, embracing economic protectionism, rebuilding infrastructure, and blowing a raspberry at the Washington establishment were much more central to his platform.

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Early in the campaign, in fact, Trump praised socialized medicine, and promised to provide everybody with health care. “As far as single-payer, it works in Canada. It works incredibly well in Scotland,” he said in August, 2015, during the first Republican debate. A month later, he told “60 Minutes,” “I am going to take care of everybody. I don’t care if it costs me votes or not. Everybody’s going to be taken care of much better than they’re taken care of now.”

Part of what is going on is that Trump needs a quick legislative success. He is keenly aware that, by this stage in his Presidency, Obama had signed a number of important bills, including a big stimulus package. Trump also badly needs to change the subject from Russia. It might sound crazy to suggest that a President would embrace a bill that could do him great harm in the long term just for a few days’ respite, but these are crazy times. If nothing else, the political furor surrounding the House G.O.P. proposal has eclipsed the headlines about Trump claiming that Obama wiretapped him. For much of this week, Trump has ducked out of sight, letting Ryan and his bill take the spotlight.

That’s not the only way the Russian story may have played into this. As the pressure grows for a proper independent probe of Trump’s ties to Moscow, he must retain the support of the G.O.P. leadership, which has the power to block such an investigation. It has long been clear that the relationship between the Republican Party and Trump is based on a quid pro quo, at least tacitly: in return for dismissing concerns about his authoritarianism, self-dealing, and Russophilia, the Party gets to enact some of the soak-the-poor policies it has long been promoting. For a time, it seemed like Trump was the senior partner in this arrangement. But now Republicans like Ryan have more leverage, and Trump has more of an incentive to go along with them.>

Still, even if he had more leeway to speak out against the House G.O.P. bill, is there any reason to think he would? The thing always to remember about Trump—and this week has merely confirmed it—is that he is a sham populist. A sham authoritarian populist, even.

Going back to late-nineteenth-century Germany, many of the most successful authoritarian populists have expanded the social safety net. Otto von Bismarck, the first Chancellor, introduced health insurance, accident insurance, and old-age pensions. “The actual complaint of the worker is the insecurity of his existence,” he said in 1884. “He is unsure if he will always have work, he is unsure if he will always be healthy, and he can predict that he will reach old age and be unable to work.”

During the twentieth century, Argentina’s Juan Perón, Malaysia’s Tunku Abdul Rahman, and Singapore’s Lee Kuan Yew were among the authoritarian leaders who followed Bismarck’s example. Today, if you look at the election platform of Marine Le Pen, the leader of the French National Front, you see something similar. Like Trump, Le Pen is a nativist, a protectionist, and an Islamophobe. But she is not proposing to dismantle any of the many social benefits that the French state provides. Rather, she says she will expand child-support payments and reduce the retirement age to sixty.

Trump, on the other hand, has little to offer ordinary Americans except protectionist rhetoric and anti-immigrant measures. Before moving to gut Obamacare, he at least could have tried to bolster his populist credentials by passing a job-creating infrastructure bill or a middle-class tax cut. Instead, he’s staked his Presidency on a proposal that would hurt many of his supporters, slash Medicaid, undermine the finances of Medicare, and benefit the donor class. That’s not populism: it’s the reverse of it. And it might be a political disaster in the making.

*John Cassidy has been a staff writer at The New Yorker since 1995. He also writes a column about politics, economics, and more for newyorker.com.

Ready for Hillary–What’s her Agenda?


New York

June 23, 2016

What Is Hillary Clinton’s Agenda?

She’s had so much to say on so many issues that voters may not know what she wants to accomplish.

by Paul Starr

http://prospect.org/article/what-hillary-clinton%E2%80%99s-agenda

Hillary Clinton Button 302

It is misleading, some observers have rightly pointed out, to treat the 2016 election as a contest between two candidates who are equally serious about policy. Donald Trump has been on both sides of many issues, contradicting himself from one day to the next. On occasion, he has given a speech written by advisers on a subject like energy where he seemed as surprised by the text as the audience was.  He has a core of symbolically important positions on such issues as immigration, but otherwise his views are murky. Much of what he says about foreign or domestic problems is all impulse and no thought, so when his impulse momentarily changes, his positions change too.

For Hillary Clinton, however, substance actually does matter. Her seriousness defines her. We have not reached the stage of gender equality when a woman candidate for president could get away with being as subject to changing moods and personal pique as Trump is. While no one would know what to expect from a Trump presidency in major areas of policy, Clinton has laid out plans in virtually every domain. That plenitude of nuanced and multilayered policies is both an asset and a limitation. It is valuable in signaling to different groups where her commitments lie, and it will be an asset in governing if she is elected. But it is a limitation in a political campaign for reasons that have been especially clear this year.

Whether voters love or hate Trump, they can name a few big things he says he would do as president: build a wall on the Mexican border, round up and deport illegal immigrants, ban Muslims from coming to America, and redo trade deals. Similarly, Democratic primary voters this year were able to identify Bernie Sanders with a few major promises: break up the banks, make public college free, and pass what he calls “Medicare for all.”

Despite Clinton’s ample detail—her website covers more than 30 different issue areas, each with bullet points about specifics—voters would probably be hard-pressed to come up with three or four big ideas they identify with her. Although it is hardly a weakness of a presidential candidate to be prepared for the scope of the job, her campaign has not had a clarifying focus on a few big themes or proposals that instantly communicate what she wants to do.

P Photo/Kathy Willens, Pool

Clinton talks with a youngster at an early childhood education center in New York in 2015.

The strategy that Clinton has adopted thus far this year may be partly to blame. Seeking to rally diverse constituencies, she has framed her candidacy in broad, progressive terms, often saying she wants to break down “all the barriers” facing people—not just economic barriers, but also those based on race, gender, sexual orientation, and other sources of disadvantage. She also says she wants to build on Barack Obama’s presidency, and since Obama has previously supported much of what she favors, those ideas do not have her own stamp—at least not yet. In contrast to Sanders, she has repeatedly said she doesn’t want to make unrealistic promises, and against both Sanders and Trump, she has cast herself as the candidate of responsibility and refused to call for huge programs or huge tax cuts that would balloon the federal deficit. In another presidential year, she might get credit for good judgment; this year, she gets criticized for lacking imagination.

Perhaps concerned about the media seizing on whatever issue she leaves out, Clinton has resisted indicating which of her proposals would have priority. In a profile this spring in New York Magazine, Rebecca Traister reports Clinton saying she doesn’t accept the premise that as president she would have to choose which issues to advance first, assuming a two-year window of opportunity to move legislation through Congress. “I want to take everything I’ve said I’m going to work on and be as teed up as possible from the very beginning. I want to give [Congress] every opportunity to move forward on several fronts.”

Of course, advances along those fronts depend on the outcome of the congressional election. If Democrats win control of the Senate as well as the presidency, it would help Clinton with both judicial and executive nominations, but not necessarily with epochal legislation if Republicans still hold their House majority. In the less likely scenario in which Democrats also win back the House, the legislative logjam since 2011 could break open—especially if Senate Democrats eliminate the filibuster (as they did for appellate court nominations in 2013). Even if the odds of full control of Congress are low, Clinton ought to be “teed up” to take advantage of that possibility. Both Bill Clinton and Obama had a two-year window at the beginning of their presidencies, and most of the progressive legislation of recent decades was enacted during those intervals—the only four years of unified Democratic government in the past 36.

Even if the odds of full control of Congress are low, Clinton ought to be “teed up” to take advantage of that possibility.

Before getting ahead of herself, however, Clinton has to win the election, and it is first of all for that purpose that she needs to define her priorities more sharply. Unlike Trump, she’s not going to go to extremes to make her case. But voters should know what to expect from her, and she needs to find ways to convey ideas that will stand out in their minds.

Focusing Clinton’s Economic Agenda

The economy and jobs usually top the list of voter concerns, so let’s begin there. Although Clinton’s approach to economic issues isn’t embodied in one or two signature policies, her agenda does have a thematic unity, summed up in a phrase she often uses, “giving working families a raise.”

A higher minimum wage is an unambiguous expression of that theme. In the Democratic primaries, the clash between Clinton and Sanders over the size of a minimum-wage increase obscured their agreement on a big jump. Raising the federal minimum from $7.25 to $12—the level Clinton has endorsed—would be the single largest increase in the history of the minimum wage in either percentage or absolute terms. (She also supports efforts in states and municipalities to raise their minimum wages to $15.) Clinton should be able to draw a sharp contrast on the issue with Trump, who has said that wages in America are “too high,” though in his customary style, he has also casually suggested he could support a minimum-wage increase, as if a Republican Congress would send him one.

Several other elements fit into Clinton’s overall theme, each of which articulates to other elements in her campaign. Like Obama, who increased infrastructure spending as part of the economic-recovery program soon after taking office, Clinton says that during her first 100 days she will call upon Congress to boost investment in roads, bridges, and other public works more than at any time since the development of the interstate highway system in the 1950s. Closely related are policies to increase investment in clean energy, including measures aimed at installing half a billion solar panels and generating enough power from alternative sources to run all of America’s homes in four years. In line with the effort to give working families a raise, she’s pledged not to increase taxes for those making less than $250,000 a year, proposing instead to finance investments in infrastructure and other measures by closing “corporate tax loopholes” and making “the most fortunate pay their fair share.”

If Democrats win big in November, the outcome may be seen, above all, as a mandate on immigration reform. Here, supporters of fair immigration reform gather in front of the Supreme Court in Washington, Monday, April 18, 2016. 

Here it is worth taking a moment to consider Clinton’s revenue and tax-fairness proposals in light of what Obama has done. Although you might never know it from discussion among progressives, the Obama years have seen a major shift in tax burdens from lower- and middle-income people to the rich. In 2009, Congress enacted three tax-credit increases that were later made permanent (the Earned Income Tax Credit, the Child Tax Credit, and the American Opportunity Tax Credit). Together, these have cut taxes for 24 million working- and middle-class families by an average of about $1,000. The subsidies for health-insurance premiums in the Affordable Care Act (ACA) represent another substantial benefit for those with low to middle incomes. At the median income, the federal income tax rate is now 5.3 percent, which is lower than the average in any presidential administration since the 1950s, indeed, less than half the rate during Jimmy Carter’s presidency (1977–1980).

The flip side of the Obama record on taxes has been higher taxation of upper-income households. In 2010, congressional Democrats and the president prevented the extension of the tax cuts for the rich enacted under George W. Bush, increasing the top marginal income tax rate back to its level during the Clinton administration (39.6 percent) and reducing tax cuts on investment income and estates. When these changes went into effect in 2013, the top 0.1 percent paid $50 billion in taxes more than they would have paid under the previous rules. Partly as a result of a provision in the ACA, the tax rate on capital gains has gone from 15 percent to 23.8 percent.

Clinton’s proposals move in the same progressive direction, raising taxes on top incomes and providing relief to the less affluent. To pay for her new initiatives, she is calling for a 4 percent surtax on people with incomes over $5 million and a new minimum tax of 30 percent on those with pre-deduction incomes of more than $1 million. Several of her tax proposals are aimed at promoting long-term investment within the United States. These include increases in capital gains taxes for assets held for less than six years and other changes in tax policy to discourage high-frequency trading and shifts of corporations, jobs, and investment abroad. One little-discussed idea she has endorsed is a tax credit to encourage corporations to adopt employee profit-sharing plans. According to an analysis by the nonpartisan Tax Policy Center, Clinton’s tax proposals would generate about $1.1 trillion over a decade: “Nearly all of the tax increases would fall on the top 1 percent; the bottom 95 percent of taxpayers would see little or no change in their taxes.”

Besides paying for infrastructure investments, much of the tax revenue Clinton proposes to raise would go to purposes that bear out her theme of “giving working families a raise.

Besides paying for infrastructure investments, much of the tax revenue Clinton proposes to raise would go to purposes that bear out her theme of “giving working families a raise.” Clinton would use some of the revenue to finance her proposal for paid family leave. In the same vein, she is proposing to move toward universal pre-K by providing new funds to states that expand access to preschool for all four-year-olds. She has also discussed limiting families’ child-care costs to 10 percent of income, and although she hasn’t yet spelled out the details, that idea could involve refundable tax credits. The proposals add up to a clear message, if Clinton and the Democrats can communicate it: tax fairness on behalf of families who are struggling to make ends meet.

On taxes, the contrast with Trump could hardly be more dramatic. Trump’s tax plan calls for sharp cuts in federal income tax rates, including a reduction in the top rate from 39.6 percent to 25 percent. According to the Tax Policy Center, the top 1 percent would see their taxes fall on average by more than $275,000, while the top 0.1 percent would enjoy a windfall averaging over $1.3 million. For the lowest-income households, the tax cut would amount to $128; for middle-income households, $2,700. In addition, Trump would also completely eliminate federal estate taxes—which currently apply only to estates worth more than $5.45 million—and reduce taxes on business. The total loss in federal revenue, conservatively estimated by the Tax Policy Center at $9.5 trillion over ten years, would lead to severe cuts in federal programs or massive increases in deficits, or both. (The estimate of lost revenue is conservative because it doesn’t take into account rising interest costs from rising deficits.) Trump has ruled out cuts in Social Security and Medicare. On that assumption, other federal spending—defense, transportation, health, education, and so on—would have to be cut by about 80 percent to balance the budget. Since cuts of that magnitude aren’t feasible, the deficit would likely grow explosively.

In the contest over economic policy, Trump benefits from the undeserved impression that he has been a business genius and, more generally, from gendered expectations about the two candidates. In contrast to Clinton’s family-centered economics, Trump offers a seemingly more muscular, nationalist alternative. He promises to get factories humming by slapping tariffs on foreign imports, undoing environmental and other regulations, and boosting production of fossil fuels, including coal. Deporting the 11 million unauthorized immigrants fits with the same approach. It’s a turn-back-the-clock agenda that may appeal especially to white, industrial workers who have lost ground in recent decades, even though the job losses in manufacturing over the past half-century primarily stem from long-term technological change that, especially with advances in robotics, will almost certainly continue regardless of Trump’s policies. Rather than helping workers, Trump’s threatened tariffs could set off a trade war that would cost jobs in export-oriented industries, and the mass deportations he calls for would be not only inhumane but also economically devastating to the regions in the United States where immigrants account for much of the workforce and consumer demand.

Hillary Clinton and her daughter Chelsea Clinton speak at a “No Ceilings” event dealing with women’s issues at the Clinton Presidential Center in Little Rock, Arkansas, November 15, 2014. 

Clinton isn’t conceding ground to Trump on industrial jobs. She is proposing to devote $10 billion to regional alliances called “Make it in America Partnerships,” aimed at strengthening industrial competitiveness and building on the National Network for Manufacturing Innovation established under legislation that Ohio Senator Sherrod Brown sponsored in 2014. The clean-energy proposals also aim at fostering manufacturing jobs. Acknowledging that trade has had mixed effects on manufacturing, she says new trade agreements have to meet “a high bar” and has backed away from supporting the Trans-Pacific Partnership.

But whereas Trump wants to wall America off from outsiders and revert to an unrecoverable past, Clinton’s agenda is fundamentally modernizing. She calls for more investment in science and technology, urges increased assistance to students to make college debt-free, accepts the facts of climate change, and generally favors trade and openness to the world. As against Trump’s “America First” foreign policy, she is committed to upholding America’s international agreements and leadership role on a planet that has become more interconnected than ever. Her support for paid family leave, universal pre-K, and assistance with child-care costs reflects a commitment to bring national policy in line with the contemporary realities of family life.

Clinton properly frames those family-centered economic policies as a foundation of general prosperity. “The movement of women into the American workforce over the past 40 years was responsible for more than $3.5 trillion in economic growth,” she argued in a speech last July. But whereas “the United States used to rank seventh out of 24 advanced countries in women’s labor force participation,” America dropped to 19th by 2013, partly because other countries are “expanding family-friendly policies like paid leave and we are not.” High-quality, affordable child care, she said, “is not a luxury. It’s a growth strategy.”

Clinton’s challenge is to persuade voters that her vision of what she calls a “growth and fairness economy” is rooted in today’s America, and Trump’s is stuck in yesterday’s.

Clinton’s challenge is to persuade voters that her vision of what she calls a “growth and fairness economy” is rooted in today’s America, and Trump’s is stuck in yesterday’s. “When he says, ‘Let’s make America great again,’” Clinton declared on June 7, “that is code for ‘Let’s take America backward.’” She needs to press the case that Trump has lied about who would benefit from his tax plan and that the tough-guy image is fake—he has no practical way of making American industry great again, either by muscling other countries in trade or by deporting millions of immigrants. But while framing Trump’s notions as backward-looking bombast, Clinton also has to fill in what are still blanks in many voters’ minds about her own program, spelling out how she would “give working families a raise.” A historic increase in the minimum wage, a big infrastructure program, tax fairness, and new policies centered on families and children can provide the substance behind that theme.

A Referendum on America

The priorities that emerge from an election and shape a presidency often depend on the conflicts that the election itself highlights, based on the identities and personalities of the candidates as well as the issues they campaign on. The 2016 election has become a referendum on the kind of society that the American people want. Eight years ago, Barack Obama’s candidacy put to the test how far Americans had come in accepting African Americans as full and equal citizens. This year’s election is also about diversity, but the conflict now focuses on immigrants because of Trump and on women because of Clinton—and Clinton has every reason, and shows every sign, of using the stark challenge that Trump poses as a call to arms to voters and, if she wins, a mandate for action.

By nominating Trump, Republicans have raised the stakes on immigration. Under George W. Bush and again in the wake of the 2012 election, Democrats thought they could reach agreement with Republicans on legislation to provide a path to citizenship for long-settled, law-abiding unauthorized immigrants. That era appears to be gone now that the GOP has a nominee threatening mass deportations. If Democrats win big in November, I expect the outcome will be seen, above all, as providing a mandate on immigration reform. A decisive rejection of Trump will be a vote for an open, diverse society, and both Clinton and congressional Democrats will be emboldened to confirm that choice. But if Democrats fall short and immigration reform fails again, Clinton has committed to maintaining and expanding the administrative actions that Obama has taken in protecting Dreamers and others among the undocumented (actions, however, that are pending before the Supreme Court).

Immigration reform—together with racial-justice issues—will likely receive priority for another reason: the political debt that Democrats, and Clinton in particular, owe to the black, Latino, and Asian American communities.

Immigration reform—together with racial-justice issues—will likely receive priority for another reason: the political debt that Democrats, and Clinton in particular, owe to the black, Latino, and Asian American communities. Clinton would not be the presumptive Democratic nominee if she hadn’t won overwhelming majorities among minority voters in the primaries. One of the first speeches she gave in the campaign was about ending the era of mass incarceration; she was also early to focus on the drinking-water crisis in Flint, Michigan, as an issue of environmental justice. She cannot afford to forget those commitments. Four years from now, minority voters could again be crucial to her re-election.

Gender-related concerns were bound to arise in the first presidential election with a woman at the head of a major-party ticket. But Trump’s sexist comments about women, open talk about the size of his penis, and peacock-like demeanor have put the politics of gender into the spotlight in an unprecedented way. Clinton couldn’t have picked a better foil for making her case for women’s rights and a vision of prosperity with families and children at the center. Just as with immigration, Clinton will have the basis for claiming a mandate on those issues if she wins in November.

IF THE REPUBLICAN PARTY hadn’t turned as far right as it has in recent years, there might well have been possibilities for bipartisan cooperation on other major issues besides immigration. Two of these, climate change and health care, have now become long-term reform projects identified with the Democratic Party, begun in earnest under Obama and necessarily of high priority to a Democratic successor.

Trump again makes the stakes exceptionally clear. While some Republicans at least acknowledge global warming, Trump once tweeted that the very idea is a Chinese conspiracy to dismantle American manufacturing. In May, as part of his energy speech, which could have been summed up as “fossil fuels forever,” he pledged to “cancel the Paris climate agreement” and rescind environmental regulations that cut carbon emissions.

Picking up where Obama leaves off, Clinton has primarily focused on using authority under existing law to promote clean energy and reduce carbon pollution. The failure of Senate Democrats in 2010 to pass a cap-and-trade program approved by the House showed how difficult it is for Democrats, even with a Senate majority, to get representatives from coal-dependent states to vote for any bill moving the country toward energy alternatives. Besides defending Obama’s executive actions—in particular, the Clean Power Plan, which effectively bars new coal-fired power plants—Clinton is calling for higher fuel-efficiency standards, changes in leasing practices on federal lands, and stricter regulation of methane emissions (and therefore of fracking). Democratic control of Congress would be necessary for some measures Clinton is supporting, such as new investments in clean-energy infrastructure and an end to tax subsidies to the oil and gas industries.

AP Photo/Doug Mills
Clinton testifies on health-care reform in 1993. Improving the ACA would be a top priority now.

On health care, there was some confusion last fall about where Trump stood. While calling for the repeal of Obamacare, he suggested that he might deviate from Republican orthodoxy and propose a program for universal coverage. But by February he backtracked, issuing a plan that would not only end coverage for about 20 million people who have gained it through the ACA but also effectively nullify state regulation of health insurance. The plan would allow insurance to be sold across state lines, enabling insurers to locate in states with the weakest laws.

Health-care reform has been the national issue most closely identified with Clinton, dating back to her role as the public advocate for her husband’s plan in 1993. She has a grasp of health policy few other public figures can match, and while continuing to carry out the ACA, she may now also have the opportunity to fix problems with the law, especially if Democrats secure a congressional majority.

In their early going, major reforms often need reforming themselves. After enacting Social Security in 1935, Democrats controlled both Congress and the presidency for more than a decade, which enabled them to amend and consolidate the program. Likewise, after passing Medicare and Medicaid in 1965, they were also able soon afterward to adjust those programs in amendments. But immediately after passing the ACA, Democrats lost control of Congress, and although Republicans have been unable to repeal the law, they have blocked constructive changes. The ACA, many Democrats initially said, would be a foundation they could build on, but they haven’t had the chance due to the gridlock in Washington.

Several problems now stand out as legitimate sources of dissatisfaction with health-care reform: high levels of patient cost-sharing in plans available in the insurance marketplaces; continued difficulties among low-income families in affording premiums; narrow networks (that is, lack of choice of physicians and other providers); and lack of competition among insurers in some states and regions. To help make coverage more affordable, Clinton is proposing a tax credit of up to $5,000 per family to offset a portion of the out-of-pocket and premium costs that exceed 5 percent of family income—another example of giving working families a raise. She would require insurers to limit out-of-pocket prescription drug costs to $250 per month for patients with chronic or serious conditions. She wants to increase incentives for states to expand Medicaid. And, as she did in her 2008 presidential campaign, she is supporting the establishment of a “public option” as a competitive alternative to private plans in the insurance marketplaces.

Considering Clinton’s long personal involvement in health-care reform, the issue should be a top priority of hers

A public option could come in different forms. One possibility endorsed by Clinton is a Medicare buy-in for people when they reach age 50 or 55. This is not a new idea; Bill Clinton proposed it for 55- to 64-year-olds in the late 1990s and Al Gore supported it in his 2000 presidential campaign. The difficulty then was the likely cost resulting from “adverse selection”; the people most likely to enroll would have been those in poor health with high medical costs. Although this problem won’t have disappeared, it should be more manageable because of the subsidized plans already available in the insurance marketplaces. In fact, by taking 50- or 55- to 64-year-olds out of the general risk pool, a Medicare buy-in could result in lower premiums (and therefore lower federal tax subsidies) for everyone else in the insurance marketplaces. Letting Medicare compete for middle-aged enrollees in the insurance exchanges could be an incremental step toward a general public option. Short of congressional action on the Medicare buy-in or a general public option at the national level, Clinton has said she will use the flexibility already provided by the ACA to help states establish their own public options. Considering Clinton’s long personal involvement in health-care reform, the issue should be a top priority of hers.

TO THE SHORT LIST OF REFORM projects that will likely rank high on Clinton’s agenda, we can add one more—democracy itself. Recent decisions by the Supreme Court and policies adopted by Republicans at the state level have increased the political importance of voting and campaign-finance rules. Whereas Republican-controlled state governments have sought to make voting more difficult, Clinton wants to make it easier. She favors automatic voter registration for 18-year-olds and a new national standard for early voting (allowing voting to begin 20 days or more before an election). She’s endorsed a small-donor matching program as part of campaign-finance reform and wants to reverse the Supreme Court’s weakening of a key provision of the Voting Rights Act, as well as the Court’s Citizens United decision.

Although Clinton would not be able to bring about many of these changes on her own authority without a Democratic Congress, she could have an enormous influence on the democracy agenda through Supreme Court and other judicial appointments. Assuming the Senate does not confirm Judge Merrick Garland during the lame-duck session after the election, Clinton—or for that matter Trump—could make as many as four Supreme Court appointments. Those choices could be the most important decisions the next president makes.

Ultimately, many people who cast their ballots for Clinton may vote more against Trump than for her, in part because they know enough about Trump to fear him, although they may be less clear about what Clinton would do. But Clinton has the basis for a stronger, positive case. She wouldn’t just make political history by becoming America’s first woman president; her family-centered economics provides the substance to make her presidency a milestone in American social life. After the long rise of inequality, it would not be a little thing to increase the minimum wage by 65 percent or to enact paid family leave and support for child care and universal pre-K. Affirming America’s commitment to an open and diverse society through immigration reform would also be a big deal. So would pushing ahead on the great energy transition and universal health care, as well as a revitalized democracy. The battle during the primaries left some Democrats feeling that Clinton wasn’t reaching high enough. But if she can accomplish half of her agenda, they may feel very different.

A Toast to the Right to Development


New York

June 22, 2016

A Toast to the Right to Development

by Martin Khor

http://www.thestar.com.my

Many problems threatening the world can be addressed through the lens of the Right to Development – that should be celebrated on its 30th anniversary.

THE Declaration on the Right to Development is 30 years old. Adopted by the United Nations General Assembly in 1986, it has had an illustrious history, having great resonance among and giving a boost to people fighting for freedom and more participation in national affairs, as well as to developing nations striving for a fairer world economic order.

It has been invoked by the leaders and diplomats of developing countries on numerous occasions, when they try to convince their counterparts of the developed countries to show more empathy for the needs of the poorer countries.

It has a central place in the Rio Principles of the 1992 Earth Summit, and most recently it was mentioned in the 2015 Paris Agreement on climate change.

On this 30th anniversary, it is fitting to recall the important elements of this right to development. It is human and people-centred, an inalienable human right “to participate in, contribute to, and enjoy economic, social, cultural and political development, in which all human rights and fundamental freedoms can be fully realized.”

Politicians and policy makers should take human beings as the central focus of their development policies, and ensure they can actively participate in the process of development and development policy, as well as benefit from the fruits of development. (Article 2.3).

But the Declaration also places great importance on the international arena. States have the duty to cooperate with each other in ensuring development and eliminating obstacles to development (Article 3.3).

And effective international cooperation is essential in providing developing countries with appropriate means and facilities to foster their comprehensive development (Article 4.2).

The right to development recognises that there are national and international obstacles to the realisation of the right to development, and it calls for states to take steps to eliminate these obstacles.

It is useful to identify some present global problems and how they affect the right to development.

First, the global economy in crisis. The economic sluggishness in developed countries has had adverse impact on developing economies.

They are facing low commodity prices, and reduced export earnings. They face great fluctuations in the inflow and outflow of funds, due to absence of controls over speculative capital flows and fluctuations in the value of their currencies due to lack of a global mechanism to stabilise currencies.

Some countries are on the brink of another debt crisis. There is for them no international sovereign debt restructuring mechanism and countries that do their own debt workout may well become victims of vulture funds.

Second, the challenges of implementing appropriate development strategies.

There are challenges in developing countries to have policies right in agricultural production, ensuring adequate incomes for small farmers, and national food security.

Industrialisation involves the challenges of climbing the ladder, moving from labour-intensive low-cost industries to higher technology industries and overcoming the middle-income trap.

There are the challenges to providing social services like health care and education and water supply, lighting and transport as well as developing financial services and commerce.

This policy-making is even more difficult due to premature liberalisation, some of which is due to loan conditionality and to trade and investment agreements which also constrain policy space.

In particular, many investment agreements enable foreign investors to take advantage of imbalanced provisions and shortcomings in the arbitration system that cause countries to lose a lot in compensation and also have a chill effect on their right to regulate and to formulate policies. A review is needed.

Third, climate change is an outstanding example of an environmental constraint to development and the right to development. There is an imperative to cut global emissions as sharply and quickly as possible. But which countries and which groups within countries should cut emissions, and by how much?

The danger is that the burden will mainly be passed on to developing and poorer countries and to the poor and vulnerable in each country.

The Paris Agreement of December 2015 was a success in terms of reaching a multilateral deal.

But it is not ambitious enough to save humanity, and it also failed to deliver confidence that the promised transfers of finance and technology will take place. Much more has to be done and within a few years.

Fourth, the crisis of anti-microbial resistance brings dangers of a post-antibiotic age. Many diseases are becoming increasingly difficult to treat because bacteria have become more and more resistant to anti-microbials.

The World Health Organisation Director General has warned that every antibiotic ever developed is at risk of becoming useless and that we are entering a post-antibiotic era.

The World Health Assembly in 2015 adopted a global plan of action to address anti-microbial resistance but the challenge is in the implementation.

Developing countries require funds and technology such as microscopes and diagnostic tools; they also need to have access to existing and new antibiotics at affordable prices.

Fifth, the challenges of implementing the Sustainable Development Goals, which are closely linked to the right to development.

For example, Goal 3 is “to ensure healthy lives and promote well-being for all at all ages”. One of the targets is to achieve universal health coverage, that no one should be denied treatment because they cannot afford it. But unless there are sufficient funds, this will remain an unfulfilled noble target.

The treatment for HIV/AIDS became more widespread only when generics were made available at cheaper prices, and since then millions of lives have been saved.

Many of the new cancer drugs and the new “biologics” are priced above US$100,000 (RM408,850) for a year’s treatment. Unfortu­nately, due to global patent rules, most patients have no access to cheaper generics.

For the SDGs to succeed, finance and technology have to be transferred to developing countries and some international rules on trade and intellectual property have to be altered if they are found to be obstacles to the right to development.

All the above global challenges have to be diagnosed as to where they comprise obstacles to realising the right to development, and the obstacles should then be removed.

That is easier said than done. But the Declaration has thrown light on the way ahead.

Martin Khor (director@southcentre.org) is executive director of the South Centre. The views expressed here are entirely his own.