The 2012 election, Republican politics and conservative media.
On Friday Karl Rove’s Crossroads GPS announced a major advertising blitz. Over the next month, beginning Tuesday, it will spend $25 million on air time in the key swing states of Colorado, Florida, Iowa, Michigan, North Carolina, New Hampshire, Nevada, Ohio and Virginia.
It will all be spent on one ad that, while it may be effective, is in no way informative. The commercial attempts to tie together two GOP talking points that actually have little to do with one another: that President Obama has failed to create enough jobs and that he has created too much federal debt.
“America’s jobless rate is still too high,” intones the voice over. “Barack Obama’s got lots of excuses.” It then shows of a montage of clips of Obama mentioning various global economic conditions. It is not at all clear that Obama necessarily offered every one of these as an excuse for the unemployment rate, rather than merely relevant pieces of context to whatever he was discussing at the time. “But Obama never blames Washington spending and skyrocketing debt,” the ad continues.
There is no effort to explain why federal spending or an increase in the federal debt would lead to a higher unemployment rate. In fact, it is the opinion of most economists that deficit spending is the appropriate response to high unemployment, as it stimulates the economy. The long-term downside to more debt is higher interest rates and inflation. But interest rates and inflation remain low.
Moreover, the ad implies that the unemployment rate and the debt are Obama’s fault, when they are actually the handiwork of his predecessor, for whom Rove worked.
The debt is increasing for reasons that are largely beyond Obama’s control: the wars that Rove’s former boss George W. Bush left for Obama to clean up, the irresponsible tax cuts Bush signed and a decline in tax revenues from the economic contraction that Obama inherited from Bush.
The notion that less federal debt would cause the economy to grow is disproved by both historical and contemporary evidence. During the Great Depression the United States began to rebound in the mid-1930s, thanks to deficit spending. After President Franklin Roosevelt cut spending in 1937, the economy dipped again. Meanwhile, the United Kingdom is currently experimenting with austerity, and it has led to their economy recovering more slowly than ours.
This is not Rove’s only forthcoming effort to bombard viewers with illogical attacks on Obama’s record. American Crossroads, Rove’s other organization, will be airing a lot of commercials in the months leading up to the election. The Washington Post reports, “American Crossroads has reserved $40 million in air time for the final two months of the campaign. Florida is at the top with $10.2 million, followed by Ohio with $7 million, Virginia with $6.5 million, North Carolina with $4.2 million, Colorado with $3.5 million, Iowa with $3.2 million, New Hampshire with $2.7 million and Nevada with $2.2 million.” Obama and his allies are unlikely to be able to match this level of spending.
Liberals have been unable to keep up with the vast fundraising ability of right-wing Super PACs. Until now the balancing factor has been that Obama’s campaign has outspent Romney’s campaign, especially in swing states.
Even so, the president was already at a net disadvantage when you add in spending by outside groups. According to the Post, these are the cumulative ad spending numbers to date (this does not include the two new Crossroads plans, nor a bunch of smaller groups):
Obama campaign, $49.6 million
Romney campaign, $33.8 million
Restore Our Future (pro-Romney Super PAC), $29.7 million
American Crossroads/Crossroads GPS (Republican), $29.2 million
Americans for Prosperity (Republican), $14.9 million
Democratic National Committee, $6.3 million
Priorities USA Action (pro-Obama Super PAC), $6.1 million
American Future Fund (Republican), $5.3 million
The totals from the expenditures above are $79.1 million on Romney’s side and $62 million for Obama. In other words, the incumbent president—who also happens to be a very prodigious fundraiser—is being outspent, thanks to the unlimited contributions of billionaires and corporations. With the $65 million in forthcoming spending by Karl Rove’s groups, Obama will be at an even greater disadvantage.
On Monday the campaigns announced their fundraising totals for the month of June, and things are looking even worse for Democrats. Romney outraised Obama by a whopping $35 million in June, $106 million to $71 million. That’s the second straight month in which Romney has outraised Obama.
And that will all come on top of the barrage of negative ads from Republican groups. Despite the conventional wisdom that Obama would attack Romney to distract from the poor state of the economy, the Post finds that 100 percent of the ad spending from GOP-aligned groups Americans for Prosperity, the American Energy Alliance, American Crossroads and Crossroads GPS have been negative. 58 percent of Romney’s spending has been on negative ads, compared to only 44 percent of Obama’s.
If anyone can win this election on the strength of a barrage of misleading negative ads, it won’t be Obama, it will be his opponent.
It did not generate the outrage that his offensive statements often do, probably just because it happened the day before July 4, but last Tuesday Rush Limbaugh made an inadvertently revealing statement. “When women got the right to vote is when it all went downhill because that’s when votes started being cast with emotion and maternal instincts that government ought to reflect,” said Limbaugh.
Limbaugh was not summarizing some serious new political science research. He was merely making assertions based on his own sexist stereotypes and the fact that women vote more Democratic than men.
The notion that women are less capable of controlling their biological weaknesses for the good of their country is often heard from right-wing men. Newt Gingrich, who never served in the military, once said that women could not serve in combat because they would “get infections,” from living in ditches.
Limbaugh’s comment is also a reflection of Republican attitudes toward voting, and why they are so eager to trample voting rights. For another example, recall that Ann Coulter told the New York Observer in 2007, “If we took away women’s right to vote, we’d never have to worry about another Democrat president. It’s kind of a pipe dream, it’s a personal fantasy of mine.”
Limbaugh’s defense is that he was joking. But you never hear liberals joke that the world would be better if men or white people were not allowed to vote.
Republicans like Coulter and Limbaugh believe that groups who vote Democratic shouldn’t have the right to vote. The available mechanisms they are using, such as voter ID laws, target Democratic-leaning groups such as African-Americans, young people, city dwellers and poor people. According to the Philadelphia Inquirer, “More than 758,000 registered voters in Pennsylvania do not have photo identification cards from the state Transportation Department, putting their voting rights at risk in the November election.” That’s 9.2 percent of Pennsylvania’s 8.2 million voters.
If there were a mechanism for disenfranchising women, the GOP would be pushing it.
US Republican presidential candidate Mitt Romney gestures while speaking at an election rally in Sterling, Virginia, June 27, 2012. Reuters/Jason Reed
Mitt Romney has been very reluctant to release his tax returns. In all his previous campaigns he refused to release any of them. This time, under pressure, he has given us only the last two years.
But he must disclose more. If you want to know why, read Nicholas Shaxson’s piece in the new issue of Vanity Fair. In it, Shaxson raises important questions about some strange aspects of Romney’s financial history:
§ What is in Romney’s offshore accounts? He has sheltered much of his wealth in tax havens such as Bermuda, but he has not disclosed anything about those investments. For instance, Shaxson writes, “There is a Bermuda-based entity called Sankaty High Yield Asset Investors Ltd., which has been described in securities filings as ‘a Bermuda corporation wholly owned by W. Mitt Romney.’ He set it up in 1997, then transferred it to his wife’s newly created blind trust on January 1, 2003, the day before he was inaugurated as Massachusetts’s governor…. Romney failed to list this entity on several financial disclosures, even though such a closely held entity would not qualify as an ‘excepted investment fund’ that would not need to be on his disclosure forms. He finally included it on his 2010 tax return. Even after examining that return, we have no idea what is in this company, but it could be valuable, meaning that it is possible Romney’s wealth is even greater than previous estimates.”
§ Why is Romney still being paid by Bain Capital? He left the firm more than ten years ago. Given its varied investments, could the fact that he is still being paid by them create a conflict of interest in office? Shaxson writes, “Though he left the firm in 1999, Romney has continued to receive large payments from it—in early June he revealed more than $2 million in new Bain income. The firm today has at least 138 funds organized in the Cayman Islands, and Romney himself has personal interests in at least 12, worth as much as $30 million, hidden behind controversial confidentiality disclaimers.”
§ Why has Romney opened foreign bank accounts, such as a Swiss account with $3 million that appeared on his 2010 returns but not his 2011 returns? How much has kept in offshore accounts in the past? Was he betting against the strength of the US dollar? How might such financial interests affect his policies as president?
§ Are Romney’s blind trusts really blind? Their trustee is Bradford Malt, his personal lawyer. Malt invested $10 million of Romney’s money in the Solamere Founders Fund, co-founded by his son Tagg and Spencer Zwick, a Romney campaign fundraiser. Malt’s and Romney’s claims that this is coincidental and Romney knew nothing of it strains credulity. If Romney knows what his blind trusts invest in, how might his investments influence his political decisions?
§ How much has Romney invested with Elliot Associates? Shaxson reports, “Elliott buys up cheap debt, often at cents on the dollar, from lenders to deeply troubled nations such as Congo-Brazzaville, then attacks the debtor states with lawsuits to squeeze maximum repayment. Elliott is run by the secretive hedge-fund billionaire and G.O.P. super-donor Paul Singer, whom Fortune recently dubbed Mitt Romney’s ‘Hedge Fund Kingmaker.’ (Singer has given $1 million to Romney’s super-pac Restore Our Future.) It is hard to know the size of these investments. Romney’s financial disclosure form lists 25 of them in an open-ended category, ‘Over $1 million,’ including Solamere and Elliott, and they are not broken down further.”
§ How did Romney build a $102 million Individual Retirement Account (IRA)? Did he avoid paying taxes in doing so? During Romney’s fifteen years at Bain Capital taxpayers were allowed to put only $2,000 annually into IRAs and $30,000 into another fund. Romney won’t say how his account generated such astronomical returns. The only explanation anyone has come up with, offered by Wall Street Journal reporter Mark Maremont, is that Romney stuffed his account with deliberately undervalued shares of Bain stock. Incidentally, Bain is still contributing to Romney’s and his wife’s IRAs.
§ Did Bain serve as a tax haven for foreign criminals? As Shaxson explains, “Private equity is one channel for this secrecy-shrouded foreign money to enter the United States, and a filing for Mitt Romney’s first $37 million Bain Capital Fund, of 1984, provides a rare window into this. One foreign investor, of $2 million, was the newspaper tycoon, tax evader, and fraudster Robert Maxwell, who fell from his yacht, and drowned, off of the Canary Islands in 1991 in strange circumstances, after looting his company’s pension fund. The Bain filing also names Eduardo Poma, a member of one of the ‘14 families’ oligarchy that has controlled most of El Salvador’s wealth for decades; oddly, Poma is listed as sharing a Miami address with two anonymous companies that invested $1.5 million between them. The filings also show a Geneva-based trustee overseeing a trust that invested $2.5 million, a Bahamas corporation that put in $3 million, and three corporations in the tax haven of Panama, historically a favored destination for Latin-American dirty money—’one of the filthiest money-laundering sinks in the world,’ as a US Customs official once put it.”
Shaxson does not allege that Romney or Bain has ever broken the law. But the public has a right to know about the ethics and probity, not mere legality, of Romney’s personal and professional financial history. Romney has made business experience the central pitch of his candidacy, so how can he claim that how he manages his money is irrelevant?
Some Republicans knew that nominating a governor who had signed a healthcare reform law with an individual insurance mandate would be a problem. It would muddy their anti-Obamacare message, they warned, even if Mitt Romney could claim that he supports mandates only at the state level. Well, their fears were well-founded.
Consider the gaffe made by Eric Fehrnstrom, a top Romney campaign adviser, on MSNBC Monday morning. As I reported on Sunday night, Republicans and conservatives have tried to make the best of the Supreme Court’s decision to uphold the Affordable Care Act by saying that if it is justified under Congress’s taxing power, then it must be a tax increase, and a massive one at that.
But Romney, who signed a law that, just like the ACA, imposes a penalty on individuals who don’t buy insurance, does not like to admit that he raised taxes. (That’s why, as governor of Massachusetts, he mostly sought to increase revenue through new and higher user fees, including preposterously cruel ones, such as imposing a $10 fee for a certificate of blindness.)
These conflicting lines got crossed when Ferhnstrom said, “The governor disagreed with the ruling of the Court, he agreed with the dissent that was written by Justice Scalia, that very clearly said that the mandate was not a tax. The governor believes what we put in place in Massachusetts was a penalty and he disagrees with the Court’s ruling that the mandate was a tax.” This flies in the face of claims by Congressional Republicans and conservative talking heads such as Rush Limbaugh, who say that the ACA is a tax. Fehrnstrom is also contradicting his own candidate who admitted back in 2008 that the penalty for not buying insurance in Massachusetts is a kind of tax.
But Congressional Republican aides tell the Washington Post’s Greg Sargent that they can continue to make this argument even as the Romney campaign says the opposite. He writes:
You’d think the fact that the GOP presidential nominee’s campaign has now confirmed that Obamacare’s mandate is not a tax would undercut the use of this talking point by GOP Congressional officials, right?
You’d be wrong. One senior Congressional aide tells me that Republicans will continue to describe it in those terms. And a second senior GOP Congressional aide emails that there is no contradiction here.…
The Romney campaign and Republican Congressional officials alike both agree with Scalia’s argument that the mandate is not a tax in the sense that claiming it is a tax makes it Constitutional, even as Republican officials continue to argue that the mandate is a tax in the sense that SCOTUS said it was in the course of upholding the law.
It’s a clever argument, and a sort of technically consistent. But, as Sargent’s Post colleague Rachel Weiner points out, “That line of attack is more easily maintained by Republicans who never imposed any such mandate.” It’s irritating to see the GOP paying so little political penalty for their complete flip-flop on the individual mandate, but it’s satisfying to see that by nominating Romney they will at least tie themselves into knots over it.
No sooner had the Supreme Court upheld the constitutionality of the Affordable Care Act (ACA) than conservatives had invented a new falsehood—let’s call it the death panels of 2012—with which to smear it.
Since the law contains a penalty for free-riders who do not purchase health insurance, and since the Supreme Court upheld the ACA under the federal government’s taxing power, Republicans are determined to rebrand the entire law as a tax on all Americans.
Several Republican members of Congress and Congressional candidates started making bogus claims about the size of this supposed tax hike. Representative Connie Mack (R-FL), called it “the largest tax on the American people in history.” Conservative media, such as Fox News, instantly starting repeating this claim. Rush Limbaugh went even further, saying, “Obamacare is nothing more than the largest tax increase in the history of the world."
By Friday the new falsehood was so well-established among Republicans that it could be cited by Republican strategists as an objective circumstance in a Washington Post article. “This ruling is the kiss of death for the Democrat majority in the U.S. Senate as health care just became a tax increase on the middle class in one of the worst economies Americans have ever faced,” Republican strategist Chris LaCivita was quoted as saying in the Post.
The claim that the ACA will impose a large tax, much less the largest in American history, is simply false. The tax it will impose is a penalty paid by those who do not have insurance and refuse to purchase it. Another way of describing it would be a user fee for emergency room care by those who refuse to pay their fair share for a healthcare system they will surely want to use if they are shot or hit by a car.
The law, of course, will assist the poor in affording health insurance. So in addition to the majority of Americans who are already covered, most will buy it. The nonpartisan Congressional Budget Office (CBO) estimates only 4 million Americans will face the penalty.
According to Politifact, a nonpartisan, Pulitzer Prize–winning fact-checking organization, “Limbaugh, GOP have it wrong: Health care law is not the largest tax increase ever.” Politifact ran the numbers, and here is what they found:
In 2019, the CBO estimates, the government will see increased revenues of $104 billion. We then divided that number into the projected GDP for 2019, which according to the CBO economic forecast is $21.164 trillion. That would mean the tax increase provisions of the health care law would amount to .49 percent of total GDP.
Depending on your rounding, that would mean the tax increases resulting from the health care law would be about the size of tax increases proposed and passed in 1980 by President Jimmy Carter, in 1990 by President George H.W. Bush and in 1993 by President Bill Clinton.
The health care-related tax increases are smaller than the tax increase signed into law by President Ronald Reagan in 1982 and a temporary tax signed into law in 1968 by President Lyndon B. Johnson. And they are significantly smaller than two tax increases passed during World War II and a tax increase passed in 1961.
The tax increases in the health care legislation do reverse a trend of federal tax cuts and represent the first significant tax increases since 1993.
But they are not the largest in the history of the United States.
And—despite what Limbaugh said—that means they cannot be the largest ever in the history of world. Limbaugh’s inflated rhetoric takes a wrong claim and puts it into the realm of the ridiculous. We rate it Pants on Fire.
Politifact actually debunked this lie a year ago when Governor Rick Scott (R-FL) made a similar claim. But mere objective reality has never concerned Limbaugh before, so there is no reason to expect it will now.
US Republican presidential candidate Mitt Romney gives his reaction to the Supreme Court’s upholding key parts of President Barack Obama’s signature healthcare overhaul law on a rooftop overlooking the US Capitol in Washington June 28, 2012. Romney said on Thursday that the American people must defeat President Barack Obama in order to overturn his landmark healthcare overhaul. REUTERS/Jonathan Ernst
This may be the rare instance where what is good for the country is good for Mitt Romney. While good economic news tends to benefit President Obama and hurt Romney, good legal news could help them both. Mind you, if you actually believe what you say, then if you have been saying the Affordable Care Act is unconstitutional, you should be disappointed by its being upheld. But everyone knows that Romney doesn’t believe anything, and many Republicans don’t really believe the individual mandate is unconstitutional. From a purely political perspective, Romney and his party have a rallying cry for their base. They will argue that only electing a Republican president and Congress can undo the ACA, since the Supreme Court won’t.
“What the Court did not do on its last day in session I will do on my first day if elected president,” Romney pledged in a press conference in front of the Capitol. He asserted that Obamacare is “not good law and it’s not good policy.”
“The American people have a choice,” said Romney. “If we’re going to get rid of Obamacare, we’re going to have to replace President Obama.”
At least top Republicans seemed to mostly realize their case was no slam dunk and that they should focus on their policy objection rather than complaining that the Court ruled incorrectly. “The president’s health care law is hurting our economy by driving up health costs and making it harder for small businesses to hire,” said House Speaker John Boehner in a statement. “Today’s ruling underscores the urgency of repealing this harmful law in its entirety.”
Senate majority leader Mitch McConnell said:
Today’s decision makes one thing clear: Congress must act to repeal this misguided law. Obamacare has not only limited choices and increased health care costs for American families, it has made it harder for American businesses to hire. Today’s decision does nothing to diminish the fact that Obamacare’s mandates, tax hikes, and Medicare cuts should be repealed and replaced with common sense reforms that lower costs and that the American people actually want. It is my hope that with new leadership in the White House and Senate, we can enact these step-by-step solutions and prevent further damage from this terrible law.
RNC spokesman Sean Spicer told MSNBC, “In November the voters will have a chance to decide. Today we set up a stark contrast for this election. Mitt Romney has made it very clear that on Day One he will repeal Obamacare.”
Erik Erickson, who runs the influential Red State blog but is more of a partisan Republican actor than a member of the media, sounded similar notes:
First, John Roberts’ opinion seems to clearly suggest he wants to keep the Supreme Court out of political fights and was willing to destroy his reputation with conservatives to do it.
Second, this forces everyone to deal with the issue politically. The President and Democrats did, according to the Court, impose a tax increase. Because it is a taxation issue, the GOP now, should it take back the Senate, have even more grounds to deal with the matter under reconciliation, bypassing the 60 vote filibuster threshold.
It’s a big win for the President and a bad day for freedom. But we can deal with it. It is not the end of the world, the republic, or freedom. It just means we have to fight harder.
Social conservative groups focused on the actual substance of the ruling itself, and they were apoplectic. Family Research Council Legal Counsel Ken Klukowski made the following statement:
The Supreme Court has today given the federal government unlimited authority to use its tax power to require Americans to engage in specific commercial activity. The obvious implication is chilling: Uncle Sam can make you buy anything, at any price, for any reason. That’s why today, the American dream gave way to a real American nightmare. President Obama’s vow about ‘fundamentally transforming the United States of America ’ was fulfilled. The Supreme Court essentially said it cannot articulate any limiting principle on the power of the federal government.
By ruling that the law is constitutional, the Supreme Court gave the federal government the power to order private citizens to enter into contracts with private organizations and give those organizations their money. This ruling fundamentally transforms the federal government from one of limited and specified powers in the Constitution to an all-powerful central government with plenary power over every area and aspect of Americans’ lives from cradle to grave.
Concerned Women for America President and CEO Penny Nance said:
We are outraged to see the Supreme Court ignoring the constitutional limits the Founders put in place to constrain the federal government’s power over us. Shame on them!
With this decision they have given a blank check to the federal government, forever altering the constitutional concept of checks and balances that has been so crucial throughout our history.
The most extreme Tea Party senator, Rand Paul, inveighed against the ruling, even going so far as to challenge the Supreme Court’s authority. “Just because a couple people on the Supreme Court declare something to be ‘constitutional’ does not make it so,” he said. “The whole thing remains unconstitutional. While the court may have erroneously come to the conclusion that the law is allowable, it certainly does nothing to make this mandate or government takeover of our health care right.”
Conservative television talkers fell into line, as they always do. Neil Cavuto of Fox News characterized the Supreme Court’s ruling as declaring “the Band-Aid is fine.” He seems not to understand the difference between constitutionality and optimal policy. He asked his boss, News Corp CEO Rupert Murdoch, whether the ACA will raise the cost of health insurance. Murdoch asserted that “it’s been shown” to increase the cost of insurance, and that it will create “a culture of entitlement” that is currently undoing Europe. Although Murdoch is not an expert on health insurance, Fox acted as if his analysis of the bill’s policy implications was inherently valid.
Fox seemed not to understand the ruling very well: the chyron said “Supreme Court Upholds Individual Mandate to Become a Tax.” Eventually they corrected it to accurately read: “Supreme Court Upholds Health Care Law Under Tax Clause.” They also cited polls showing a majority of Americans think the mandate is a violation of their individual rights, as if a legislation’s constitutionality were determined by popular vote.
Fox News also devoted as much time to discussing the 7-2 vote overturning some of the state mandates in the law. Anchor Megyn Kelly said, without any evidence, that this was “an easier call” for the justices than ruling on the mandate, because of the wider margin. How she knows that John Roberts, Ruth Bader Ginsburg and Sonia Sotomayor were not just as certain that the mandate is constitutional, she does not say.
Former Senator Rick Santorum, the Republican presidential runner-up, seems to have been driven to insanity by the ruling. He issued a statement that was shocking in its hysteria:
I believe so strongly that if we do not defeat President Obama this November and elect more conservatives in the House and Senate, our country’s future prosperity is at risk. We saw the absolute disregard President Obama showed for the Supreme Court’s ruling on the Arizona immigration law, that I have no doubt that he sees today’s ruling in his favor as a mandate that he can now do whatever he chooses by any means possible.
President Obama believes he is above the law, entitled to abusing his power to get what he wants, and willing to violate the constitution and the oath he was sworn to uphold. He has proven to be a very dangerous person to have this kind of power, and if he is not stopped this November, I am fearful that the make-up of this country as established by our founders will never be the same.
On Twitter, low-brow conservatives did what they always do, and equated anything they do not like with slavery. “This is the greatest destruction of individual liberty since Dred Scott,” tweeted Ben Shapiro, a syndicated columnist and editor for Breitbart.com. “This is the end of America as we know it. No exaggeration.” Right, no exaggeration at all.
Fox contributor Sarah Palin offered a typically caustic tweet: “Obama lied to the American people. Again. He said it wasn’t a tax. Obama lies; freedom dies.”
More intellectually serious conservatives took a more nuanced view. Jonathan H. Adler (no relation) of National Review, saw a silver lining in the fact that Chief Justice John Roberts upheld only the individual mandate to buy health insurance under Constitution’s taxing power, not the Commerce Clause. He argues that if Democrats have to sell such policies as taxes on the front end, they will have a harder time doing so politically. He writes:
While Chief Justice Roberts concluded the mandate is a tax, he also rejected the Commerce Clause arguments in favor of the mandate. This is significant, because it will limit the ability of Congress to adopt additional mandates in the future. No one will be able to claim such requirements are not a tax, and this will make such requirements more difficult to enact.
Equally important, the majority narrowed the Medicaid provisions substantially in a way that limits Congress’s power to impose conditions on the receipt of federal spending. Specifically, the Court held that Congress may attach conditions on the receipt of new money—in this case the Medicaid expansion—but that Congress may not condition the receipt of funds for separate, pre-existing programs on compliance with the conditions for the new program.
There was no possible bad outcome for Romney. However the Supreme Court ruled, Romney and his party had already won. The entire Republican Party and conservative movement had united behind the notion that a policy, the individual mandate, that many of them had supported right up until President Obama embraced it, is an unconstitutional atrocity. By repeating the argument ad nauseam they managed to convince much of the public and several District and Appeals Court judges. If no one had bought their loony argument in the first place this wouldn’t have much traction. But Romney could rest easy in the assumption that a few radical right-wingers on the Court would offer a dissenting opinion and lend credibility to the assault on the last seventy years of American jurisprudence. “I agree with the dissent,” said Romney. Now he will try to achieve what they could not: depriving 50 million Americans of health insurance.
Mitt Romney’s challenge among young voters might seem so daunting that his party would just give up on trying to appeal to them. Romney is manifestly uncool, and he is challenging the coolest president in American history.
And so Romney and Republicans are not trying to make young people like them. But that does not mean they are ignoring the youth vote. On Monday the Romney campaign announced the formation of “Young Americans for Romney leadership team.”
Romney’s allies on the right are using a purely negative approach to youth-oriented messaging. They offer no positive agenda; they merely characterize Obama’s record in the most depressing terms possible. Karl Rove’s nominally independent conservative group has launched a youth outreach arm called Crossroads Generation. It has posted two misleading videos on its website.
The first beats up Obama over the rising cost of college, without noting that Obama’s measures to aid college students have actually made the net cost of college hold steady. It also leaves out the fact that Romney has not offered a college affordability plan.
The second, posted on Monday, called “60 Seconds on Health Care Reform and Young Americans,” offers a bizarre analysis. It acknowledges that that the provision in the Affordable Care Act allowing young people to stay on their parents’ insurance until the age of 27 is appealing. But it claims this doesn’t matter because “states already allow” them to. Some states do, and some don’t, but by this is an incredibly weak argument against guaranteeing the same rights to every young person in the country.
The ad then claims that even the Obama administration admits that young people will have to pay more than they need to for health insurance, because of the individual mandate.
This is a very strange way of looking at the insurance market. Currently, if you are young and you want health insurance but you make more than the federal poverty level, you have to buy subpar insurance for a high price because that is all the individual market offers. Under the ACA, you will be more likely to qualify for Medicaid, because the eligibility threshold is being raised, and quite likely to qualify for federal subsidies, which go up to 400 percent of the poverty line. Even if you make too much to qualify for either, you will be buying into a market that offers better insurance—thanks to new regulations—for a lower cost, thanks to the individual mandate forcing the young and healthy the market.
So collectively the young and healthy will be paying more to subsidize the sick or middle-aged. But one day the young and healthy will be older and sicker. In the meantime, they get health insurance. Granted, some young people may not want to pay anything for health insurance, but if you are a young person who did want health insurance, the ACA will make you pay less for it, not more.
Young people who choose not to get health insurance are simply free-riders mooching off society. If they get into a car accident, they go to the emergency room and the rest of us pick up the tab. So for the handful of young people who make more than 400 percent of the poverty line, don’t get employer-based health insurance and want to mooch off everyone else if they get sick, this will mean having to pay their fair share. Cry me a river.
The anti-Obamacare ad, of course, offers nothing in the way of a better alternative to providing insurance for the uninsured, solving the free rider problem or lowering costs.
Crossroads Generation maintains that they are offering a positive Republican vision to young people, but they continue to avoid offering any specifics. “We think that economic issues are going to be the decisive ones in this election, and that Republicans have an opportunity to make the case to young people that their policies would do better. Our goal is to be a part of the conversation so that young voters are hearing from both sides—both about why Obama's policies have been a letdown and how we think they can do better,” says Kristen Soltis, spokeswoman for the group. “It is critical for Republicans to persuade and to turn out young voters.”
The Romney campaign itself offers some vague hand-waving about how Romney’s intention to reduce the deficit and boost job growth will benefit young people. But he offers little to nothing in terms of a specific agenda on youth issues such as the affordability of higher education.
That’s because the Republican outreach to young people is best understood not as messaging but as part of their effort to select a more favorable electorate. As the 2010 midterms demonstrated, lower turnout among young voters and non-whites will favor Republicans. The Republican attack on voting rights is meant to reduce the number of young people and minorities who can vote.
But they are also hoping to simply make Obama so unappealing to those groups that they are less likely to show up at the polls in the first place. “If I were Romney, I’d just try to make young people discouraged [about either choice],” says one Republican consultant. That’s clearly the Republican approach.
If Mitt Romney is looking for a running mate to completely undermine his argument that his campaign represents the outsider-businessman, fiscally responsible alternative, he would be hard-pressed to find a better choice than Senator Rob Portman (R-OH). And yet the freshman senator and Washington insider is reportedly high on Romney’s vice-presidential short list. (This past weekend he was one of the chosen few attendees at Romney’s mysterious confab with big donors and nominal outside organizers such as Karl Rove.)
Portman’s pedigree is that of a generic establishment Republican career politician. Born in Cincinnati, Portman graduated from a private high school, Dartmouth and the University of Michigan Law School. After law school he moved to Washington, DC, where he worked for the paradigmatic lobbying firm Patton Boggs. Portman registered as a foreign agent, because he represented repressive foreign autocracies such as the Sultanate of Oman and the Republic of Haiti (ruled at the time by infamous dictator “Baby Doc” Duvalier). In 1989 Portman joined President George H.W. Bush’s administration as assistant White House counsel, later serving as White House director of legislative affairs.
In 1993 Portman entered a special Congressional election back in Ohio. Portman’s Congressional career was hardly that of a legislative powerhouse. His signature accomplishments include authoring laws to eliminate capital gains taxes on most home sales and drug prevention efforts.
While lobbying for dictators would usually be a prospective running mate’s biggest liability, it is not Portman’s. By far the biggest risk in choosing Portman would be his role in the failed policies of President George W. Bush’s administration. Portman served during Bush’s second term as US Trade Representative and then as director of the Office of Management and Budget.
The Bush administration’s record during Portman’s tenure is an objective failure in both areas. As Portman’s 2010 Democratic Senate opponent noted in an attack ad: “On [Portman’s] watch as Bush’s trade czar, our deficit with China exploded, sending 100,000 Ohio jobs overseas. As Bush’s budget chief, Portman oversaw a spending spree that doubled the deficit.” America’s trade deficit with China increased by about $228 billion, or by 21 percent, during Portman’s thirteen months as trade rep. This could be especially problematic for Romney, now that it has been revealed that Bain Capital invested in companies that moved jobs to China and India.
This is the political risk that picking Portman poses for Romney: while Romney proposes to return to George W. Bush’s policies, he doesn’t want to admit that this would result in the same outcome. So he might be wise to avoid picking anyone from the Bush administration as his running mate.
The fact that Portman managed to beat Fisher should not be taken as a guarantee that Portman’s record from the Bush years is not a liability or that he would carry Ohio for Romney. Fisher came out of a very divisive primary, and he was heavily outspent by Portman.
Luckily for Portman, Romney is running a risk-averse campaign. Romney’s bet is that reminding low-information swing voters every day that the economy is not as strong as they would like will drive them into the arms of any acceptable-seeming alternative. Two generic Republicans—older white men from the worlds of business and politics—is all the Romney campaign wants. If they choose Portman, they will get that at least.
Republican presidential candidate, former Massachusetts Governor Mitt Romney gestures during a campaign stop at Holland State Park on Tuesday, June 19, 2012, in Holland, Michigan. (AP Photo/Evan Vucci)
To look at Mitt Romney—the boxy power suits, the body toned by jogging—he is the financial industry personified. To listen to him, whether casually offering a $10,000 bet or flatly declaring, “corporations are people,” is to hear the unrestrained id of Wall Street. Remarkably, in the middle of a sluggish economy brought about by the irresponsibility of bankers gambling with other people’s money, Romney thinks this is his greatest asset.
Romney likes to contrast his own résumé with President Obama’s by saying, “To create jobs, it helps to have had one.” He means that a job is not really a job unless it is in the for-profit sector. Likewise, Romney asserts, “I’m a guy who has lived in the world of business. [If] you don’t balance your budget in business you go out of business. So I’ve lived balancing budgets.”
Even some of his erstwhile rivals say Romney’s experience in consulting and private equity qualifies him to be president. Former New York Mayor Rudy Giuliani, who harshly criticized Romney’s record when running against him in 2008, recently offered this endorsement of Romney on CNN: “Governor Romney has almost a perfect record for a person to be running right now, experience in government, experience in business, understands the economy.”
It is notable that in a country that idolizes successful business executives and fetishizes great wealth, there have been so few presidents from a business background. That’s because Romney’s pitch is actually quite unusual in American history and it grows out of the recent evolution of the modern GOP.
Back in the Gilded Age the great titans of industry were generally averse to running for office. The massive inequality of the era created resentment, and being fabulously wealthy was seen as a liability rather than an asset in a popular election. “It was something to run away from,” says David Nasaw, a history professor at CUNY and author of biographies of Andrew Carnegie and William Randolph Hearst. The robber barons generally controlled public policy by pulling strings from behind the scenes, serving as patrons and advisors. “They preferred to have friends in office,” says Richard White, a professor of American history at Stanford.
The one notable outpost of robber barons in public office was the US Senate. Prior to the ratification of the Seventeenth Amendment in 1913, senators were chosen by state legislatures. Consequently, the Senate was filled with businessmen who literally bought their seats through bribery, hence the body’s nickname “millionaires club” which persists to this day. (Tea Party activists have recently raised the idea of repealing the Seventeenth Amendment.)
These were not a particularly distinguished group of statesmen. Contra Romney’s rhetoric, businessmen do not always come to Washington merely to get government out of the way of self-sufficient businesses. Rather, they often came specifically to get laws passed that would favor their personal interests. Many of them hailed from extractive industries such as mineral mining, or mass agribusiness like cattle ranching, which needed cheap access to federal land. Others, most notably Leland Stanford of California, were railroad barons who sought federal subsidies. “To think of business and government as two separate worlds utterly misportrays reality. The two are intertwined,” says White. “Without government [robber barons] have no business.”
They often proved ineffective legislators even by their own corrupt standards. “[Robber barons] were often not men of great talent outside a narrow realm,” notes White. Take Stanford, who purchased his Senate seat in order to get the federal government to forgive a loan that was coming due for the Central Pacific railroad company. He failed to do so. “Stanford was a pretty poor senator,” says White. “He was more useful to the railroad industry when controlling the [California] legislature than when he was in the Senate.”
After they lost the ability to buy Senate seats outright, captains of industry generally contented themselves with high-ranking cabinet positions. The secretary of the treasury often comes from the private sector. The most powerful treasury secretary since Alexander Hamilton was Andrew Mellon, who served under three consecutive Republican presidents: Warren Harding, Calvin Coolidge and Herbert Hoover. (One contemporaneous joke meant to illustrate Mellon’s power was that the three presidents served under him.) Before coming to Washington, Mellon had expanded the business empire established by his father that included interests in banking, steel, aeronautics and oil.
Although the 1920s is generally remembered as an era of prosperity, it was one of growing inequality. Decisions by Mellon to loosen regulations or scale back their enforcement contributed to the crash of 1929. When the Great Depression hit, Mellon’s infamously cold-hearted anti-interventionist advice to Hoover—“Liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate”—proved disastrous. Romney has echoed those themes today, urging Washington to “Let Detroit Go Bankrupt” and let the real estate market “hit the bottom.”
More recent treasury secretaries from the financial industry have had blind spots similar to Mellon’s, whether due to ideology of conflicts of interest. William Simon, who was treasury secretary under Richard Nixon, came from Salomon Brothers and was a vociferous advocate of deregulation, as were Clinton’s first two Secretaries, Lloyd Bentsen and Robert Rubin, who had both been executives at financial firms. And, of course, Hank Paulson, who like Rubin came from Goldman Sachs, favored shoveling condition-free funds into Wall Street firms during the 2008 financial crisis. “Paulson made decisions because he had close ties to people on Wall Street, and those decisions were not always helpful,” says Jeff Madrick, author of The Age of Greed and a senior fellow at the Roosevelt Institute.
The only example in American history of business executives playing the role in national government that Romney promises to fill—disinterested bearer of managerial acumen—was the class of patrician “Wise Men” who served in post-war cabinets. Many of them were recruited to government from Wall Street or corporate law firms. Although these were not ideologues like Mellon or crony capitalists like Stanford, they were quite capable of making of devastating mistakes. “The ‘Whiz Kids’ come out of Ford, where Robert McNamara trained, presumably applying to foreign policy and war-making the lessons learned at Ford and other corporations,” says Steven Fraser, a professor of American studies at Columbia who has written several books about Wall Street. And you know how well that turned out in Vietnam.
But no sooner did McNamara’s Vietnam quagmire end than the Reagan Revolution created a new paradigm that is favorable to Romney: the assumption among Republicans that the private sector is always superior to the public sector.
The election of 2000 was the first time a Romney-esque figure, George W. Bush, a minor oilman and partial baseball team owner before serving as governor of Texas, became president. Bush, the first “MBA president” and his powerful Vice President Dick Cheney, who had been CEO of Halliburton, disproved the notion that businessmen are efficient managers or fiscally responsible in public office. The Bush-Cheney record—bungled occupations of Iraq and Afghanistan, the non-response to Hurricane Katrina, exploding national debt—and recent economic history should make Romney’s pitch a bad one for this election cycle.
And yet here is Romney, acting as if businessmen hawking deregulation and tax cuts are the solution to our economic and budgetary woes, not the cause of them. Romney treats the relevance of his business experience as so self-evident that he has not even bothered to come up with a real theory to justify it. When Time’s Mark Halperin recently asked Romney how exactly his business career would guide his actions as president, Romney offered only a restatement of his premise. He has even gone so far as to favorably mention a proposal to amend the Constitution to require three years of business experience to be president. “You see then he or she would understand that the policies they’re putting in place have to encourage small business, make it easier for business to grow,” he explained. This, of course, would have disqualified great wartime leaders such as Abraham Lincoln and Franklin Delano Roosevelt.
Even looking just at the historical economic record, Romney’s argument doesn’t stand up to scrutiny. The economy has not performed better under presidents who had business experience. All four of the modern presidents who had significant business experience—Herbert Hoover, Jimmy Carter and both George Bushes—presided over significant economic downturns. The first three were blamed for failing to take effective corrective action and consequently lost their bids for re-election. That may not always have been fair. The OPEC oil embargo may simply have been beyond Carter’s power to affect. But it is far from obvious how business experience gives a president the ability to lower oil prices, as Romney promises to do, when they are really set by global supply and global demand.
“What you get in the 1980s and ‘90s is the efflorescence of free market ideology,” says Fraser. “That’s when you get this claim, ‘I’ve been a mover and shaker for a decade: that qualifies me to be a statesman because that’s when the economy functions best, when you minimize the intrusion of government.” If you believe that, then no matter what happens it must be the fault of government, not industry.
The Obama campaign is combating that argument on several fronts, including Romney’s own record as governor. During his tenure, Massachusetts ranked forty-seventh among the states in job creation. He left office with a $1 billion deficit and the most debt per resident of any state in the country. And Romney’s approach to governance could hardly be described as pragmatic technocracy. Despite the importance of the biotech sector to Massachusetts’ economy, Romney vetoed a bill providing for embryonic stem cell research.
Obama is also going after Romney’s record at Bain Capital, noting that Bain was actually in the business of creating wealth, not jobs, and that it frequently laid off workers, shuttered factories and led businesses into bankruptcy. They are actually making an important point about Romney’s qualifications, not just stirring up populist anger at the natural result of free market capitalism: “business” is an awfully broad category. Different business jobs reward different skill sets, each of which may have its own applicability, or lack thereof, to a given public office. “There are all kinds of business, some relevant and some not,” says Madrick. “It’s hard to argue that running financial firms makes you a good manager.” As Paul Krugman recently demonstrated in his New York Times column, it is a myth that private equity managers such as Romney improved economic productivity. Economy-wide productivity stayed flat in the 1980s when the private equity industry burgeoned. Productivity took off in the 1990s (under career politician Bill Clinton) thanks to the digital technology revolution.
The business executive who has entered public office in recent years and can most plausibly claim to have brought his managerial innovations to government is New York City Mayor Michael Bloomberg. But, before Bloomberg made his vast fortune by inventing his news terminal, he was fired from the Salomon Brothers trading desk.
And then there are all the areas of governance in which—unlike economic growth or balanced budgets—what constitutes a good result, never mind the best way of reaching it, is a matter of opinion. How does familiarity with spreadsheets tell you what do about the unrest in Syria? Does having met a payroll make you better qualified to select Supreme Court justices? (George W. Bush’s initial selection of his under-qualified crony Harriet Miers suggests that it does not.)
Ultimately, governing is about policy choices, not creating wealth. Romney has embraced the economic platform of career politician Representative Paul Ryan (R-WI). That includes budget-busting tax cuts and unspecified spending cuts and tax reforms that are supposed to offset them. In other words, his business career notwithstanding, Romney’s economic policy would be indistinguishable from other far-right Republican ideologues.
In the 2008 campaign the same Rudy Giuliani who now highlights Romney’s economic management credentials mocked his record in Massachusetts. When recently asked about that by CNN’s Candy Crowley, Giuliani responded thusly: “[Massachusetts under Romney] had a growth of jobs of 40,000, we [New York City under Giuliani] had a growth of jobs of 500,000. So I was comparing what I thought was my far superior record to his.” In so doing, Giuliani completely undermined his own argument for Romney. Giuliani was a former prosecutor, not a private business manager. If he proved better at managing economic growth than Romney, what does that say about Romney’s central claim to the White House?
The Obama campaign has asked the Federal Election Commission to reclassify Crossroads GPS, a 501(c)4 organization founded by Karl Rove as a political action committee. In a letter sent on Tuesday, Obama for America lawyer Robert Bauer argues that Crossroads GPS has the election or defeat of federal candidates as a “major purpose” and it should therefore be treated as a political action committee under the tax code. If the FEC were to agree Crossroads GPS would have to disclose its donors.
Unfortunately, according to Rick Hasen, an election law expert at UC Irvine and editor of the Election Law Blog, the FEC is not going to rule on this before the election. “The FEC moves very slowly in the best of circumstances and we’re not in the best of circumstances,” says Hasen. “It takes years to investigate and adjudicate. It’s not designed to act in real time.” That means Crossroads GPS and other 501(c)4s could get away with running blatant electioneering ads and just face a penalty, usually a fine although criminal penalties are possible, after affecting the outcome of the election.
It may take years to resolve the issue because the FEC has an even partisan divide. If its ruling is deadlocked the complaint will probably end up in federal court. Last week the federal Fourth Circuit Court of Appeals upheld the FEC’s “major purpose” test. In Real Truth About Obama v. FEC, the Fourth Circuit upheld a lower-court ruling that the group, a Democratic-leaning organization that registered under section 527 of the tax code, was a political committee because it had helping Obama win (in 2008) as a major purpose. Hasen speculated at the time that under the standard in this case, Democrats or election reform groups would file complaints against Crossroads GPS.
There are plenty of good reasons to argue that Crossroads GPS is primarily about winning the White House and Senate for Republicans, not just enhancing social welfare or advocating public policy positions, as it claims to be. It makes television commercials that are filled with dishonest propaganda attacking Obama or Democratic Senate candidates. “I thought even before Real Truth About Obama that Crossroads GPS was acting like a political committee and should be classified by the FEC as a political committee,” says Hasen. “I think that argument is only strengthened.”
But Republicans argue that Crossroads GPS has not violated its status, noting that plenty of groups with a policy advocacy mission, on both the right and the left, engage in communications that could affect an election. “Crossroads GPS keeps within their policy agenda boundaries,” says Jon Henke, a Republican consultant. “In 2010, they had what they called the ‘7 in &rssquo;11’ plan. Now they have the ‘New Majority Agenda.’ The info is on their website, including bills they support and oppose. It's a lot more detailed than most 501(c)(4) organizations' policy agendas. And yes, it is aimed at policymakers who are up for election, when the public is paying the most attention to issue advocacy.”
The Democratic side has a set-up similar to American Crossroads and Crossroads GPS. The Super PAC supporting President Obama, Priorities USA Action, is affiliated with a 501(c)4 organization called Priorities USA. Henke argues that any ruling that Crossroads GPS is a political action committee would have to fall equally on Priorities USA. But Priorities USA has not yet run ads to anywhere near the extent that Crossroads GPS has, so it does not have the same track record to judge. Until it runs ads that could be fairly perceived as having a candidate’s election or defeat as a major purpose, it cannot be judged to have violated the law. Ultimately, though, if it runs similar ads and a ruling comes down after the fact finding Crossroads GPS in violation, this judgment could fall on a number of other groups, including Priorities USA.
Since Crossroads GPS won’t be ruled on until after the election, the Obama campaign is presumably just hoping to gain some political messaging advantage by raising awareness of the role of large undisclosed contributions in their opponents’ efforts. That may pump up the base a little, but is unlikely to have any effect on swing voters. “While I bet you could get polls to show that people dislike money in politics, I am very skeptical that votes actually change based on that,” says Henke. “ Lots of people who were already going to vote for Obama will say that is the most important thing to them, but how many likely Romney voters will vote for Obama because Crossroads GPS won't disclose its donors? Ballpark guess: 0, give or take a few.”
You can watch the commercials Crossroads GPS released in three states last week and determine for yourself whether it seems like they have an electoral outcome as a major purpose:
Correction: This article originally stated that Crossroads GPS has donated to American Crossroads, its affiliated Super PAC. I regret the error.