On Negotiation...

A term being thrown around the political arena a lot lately is the term "negotiate". The problem is that there isn't much actual negotiating going on. Rather, what we have been seeing is a whole lot of extortion and grandstanding. Republicans have shut down the government rather than negotiate. Obama (mistakenly, in my opinion) has said he is refusing to negotiate. And now our nation is stuck in the mud.

"Negotiating" with someone implies trying to reach agreement by mutual give-and-take. If you aren't offering anything of value to the other party, or if what you are "offering" is the lack of destruction of their or jointly-owned property, you are not negotiating. Indeed, the latter case is clearly extortion. Unfortunately, this is precisely what Republicans are doing today. Their "negotiations" have been nothing but constantly shifting their demands, while steadfastly refusing to offer anything in return. Repeal ACA? No? Ok, how about a delay. Or a repeal of some of the taxes? Or automatic spending cuts every time we refuse to sign a budget? And what are we offering in return that Democrats would want? Nothing, other than abiding by previously agreed-upon budgets and not defaulting on the debt!

Obama is infinitely better, but I think he has muffed the messaging. He should be very clear that he is (and has been) willing to negotiate and make major deals, under two conditions

1: That the government is running under the agreed-upon budgets with no immediate threat of shutdown, and that the debt ceiling is removed as an issue

2: That Republicans meet half way, and make concessions on taxes, military spending, and other Republican priorities

For the last five years, it has been Republicans who have refused to negotiate, balking at anything that even smells of a tax increase. Given our ultra-low tax rates (third lowest of the 34 OECD nations), there is no solution to our long-term problems that does not involve more revenue. Until Republicans realize this, and move beyond the childish extortion tactics they are currently engaged in, there will be no major progress politically. Republicans need to look back at the Ronald Reagan who actually existed and emulate him - a man who met Democrats in the middle, accepted a dozen tax increases, and made the nation a better place.

Red Up, Blue All The Way Down

This is an updated version of a post I originally wrote in March.

I've produced four different graphs below, all showing the same data but with slightly different adjustments. All data is calendar years, not fiscal years. Amazingly, the increase in our debt in Q3 of 2013 was less than $9 billion, in part due to the Treasury's efforts to avoid hitting the debt ceiling. The four graphs are:

1: Quarterly deficits vs GDP
2: Quarterly deficits, nominal
3: Quarterly deficits, inflation adjusted
4: Quarterly deficits, inflation adjusted per citizen

It's a lot of data, but the trend is rather obvious - vote Republican if you love exploding deficits, and Democratic if you love balanced budgets. This general trend holds true not only for the years on the graph, but all the way back to the post-war era. The last Republican president to oversee a reduction in the deficit was Eisenhower. The last Democratic president to oversee an indisputable rise in the deficit was FDR, and I think he deserves a pass due to WWII. Carter is the odd man out here. The deficit was largely unchanged during his term in office and whether it was a slight increase or a slight decrease depends on your measure. Also note that our projected deficit going forward is consistent with it approximately halving from its current level by the time Obama leaves office.

So when members of one particular party gripe about "fiscal responsibility", just show them these graphs, and remind them of how they have less than zero credibility on the matter.

Similar data can be found at AngryBearBlog here.