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Cracker Squire


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Location: Douglas, Coffee Co., The Other Georgia, United States

Sid in his law office where he sits when meeting with clients. Observant eyes will notice the statuette of one of Sid's favorite Democrats.

Monday, February 28, 2011

The Gang of 6 leads the way as the Pres. fails to offer leadership & GOP in House fritters away its energies on a tiny slice of the budget.

From an editorial in The Washington Post:

WHEN WE FIRST wrote in December to applaud the stop-the-dawdling debt reduction effort launched by Sens. Mark R. Warner (D-Va.) and Saxby Chambliss (R-Ga.), the bipartisan group seemed like a potentially useful adjunct to the momentum generated by President Obama's fiscal responsibility commission in the fall.

Now, with the president having failed to offer leadership and House Republicans frittering away their energies on a tiny slice of the budget, the Warner-Chambliss effort is looking like the only game in town. It has evolved into the newest Gang of Six, the two senators plus their Republican and Democratic colleagues who served on the commission and voted for its recommendations: Republicans Tom Coburn of Oklahoma and Mike Crapo of Idaho and Democrats Richard J. Durbin of Illinois and Kent Conrad of North Dakota. They should be doubly commended: first for doing the difficult work of translating lofty commission talk into concrete legislative action; second, for being willing, in a time of ideological rigidity, to accept that painful trade-offs will be essential to putting the country on a sustainable fiscal path.

This won't be easy, politically or substantively. Already, the Democrats have come under fire from Senate leaders for considering changes to Social Security benefits. Anti-tax purist Grover Norquist warned the Republican senators about being "implicated as parties to a bipartisan budget deal containing a net tax increase," in apparent violation of their no-new-taxes pledge. Exactly how to balance spending cuts with revenue increases will entail wrenching debate about the size and role of government. The question of how targets for specific cuts would be enforced is especially complex: Would programs for the poor be imperiled if enough is not cut or raised elsewhere? There's a risk that the painful choices needed to produce a package acceptable to a supermajority of senators would be treated as the opening bid for House Republicans to ratchet even further in the direction of cuts.

Nonetheless, at a time when everyone is happy to talk about the need for adult conversation, the Gang of Six is actually having one. They're debating numbers, deadlines, legislative methods. That's an important start. Maybe at some point Mr. Obama will decide to join in.

Governors Scramble to Rein In Medicaid - Medicaid funds nearly two-thirds of all nursing-home residents.

From The Wall Street Journal:

More than half the states want permission to remove hundreds of thousands of people from the Medicaid insurance program, a move that would represent a rare cut to a national social program.

The push sets up a showdown between states struggling with fiscal 2012 budgets and the Obama Administration, which says it may lack the authority to allow such cuts. That means Congress could be forced to settle the matter.

Nearly every state has nipped at parts of the program, which currently insures 53 million Americans. Arizona stopped covering certain organ transplants, Washington pared vision and dental services and South Carolina has eliminated coverage of circumcisions.

But governors say those aren't enough to control a program that swelled during the downturn and is now tied with education as their top expense.

Created in 1965, Medicaid was designed as a federal-state partnership to provide a health coverage for the poorest Americans, particularly those with children.

As of 2009, states on average cut off working parents earning more than $11,616 a year, according to the Kaiser Family Foundation, although in some states the income threshold is as high as $48,400.

About eight million Americans joined the Medicaid rolls between 2007 and 2010, many because they lost jobs. The federal government picks up 57% of states' Medicaid tab, on average. But in July, $26 billion in additional federal Medicaid funding will expire, leaving states to plug a big budget hole.

At issue is a provision in the health-overhaul law enacted in 2010 that says states can't limit Medicaid eligibility or else they'll lose federal funding.

As a result, every one of the country's 29 Republican governors has asked the federal government to waive the requirement, with New Jersey penciling a waiver into its budget. Some states with Democratic governors, including Washington, are also quietly pressing for the change.

"We're asking for cooperation…so that we can work our way through what is a very challenging time for us," Washington Gov. Christine Gregoire said at a meeting of the National Governors Association in Washington this weekend, where curbing Medicaid costs was a top issue.

The Obama administration Friday moved toward allowing a small cut in eligibility and greater cost-sharing for enrollees, but gave no sign it will allow larger reductions.

Health and Human Services Secretary Kathleen Sebelius told states earlier this month they should close their Medicaid budget gaps through other means, such as via higher copayments and by purchasing prescription drugs more efficiently.

"An eligibility cut or even a provider cut can potentially bring in some savings, but it's really not going to get where the big dollars are," said Cindy Mann, director of the federal Center for Medicaid and State Operations.

States disagree, contending federal rules hamper them from touching the real cost drivers of the program, such as long-term care. Medicaid funds nearly two-thirds of all nursing-home residents.

A bigger issue may be whether federal officials have the power to grant such waivers. Some governors say Ms. Sebelius has told them she's unable to grant states the flexibility to reduce their Medicaid rolls.

While the law gives the HHS secretary some flexibility for enforcement, officials say they still haven't determined whether she could waive this particular requirement. "We're still looking at our waiver authority and whether we think we have the legal authority," Ms. Mann said.

The last time there were big changes to the social safety net was in the mid-1990s, after an overhaul of welfare crafted by a Republican Congress and signed into law by President Bill Clinton, a Democrat.

Since then, federal social programs have tended to grow, not shrink, including a big expansion of drug benefits signed by President George W. Bush, a Republican.

In recent years, Medicaid has grown into one of largest payers in the health system, accounting for 17% of all hospital spending. Experts say the program's funding woes stem from the rising number of people with expensive chronic health conditions, coupled with the recession. As of 2008, 1% of all beneficiaries ate up 25% of the program's expenditures, HHS says.

In 2000, Medicaid spending was $187 billion. That figure rose to $346 billion in 2009, the latest full calendar year for which figures are available, according to the Centers for Medicare and Medicaid Services. Governors are also casting a worried eye to 2014, when the health-care overhaul will add millions more to Medicaid.

Governors say the fastest way to pull back their costs is to allow states to cut people and costly benefits. Since taking office last month, Maine Gov. Paul LePage, a Republican, has brought his state's Medicaid woes to President Barack Obama, Vice President Joe Biden and Ms. Sebelius.

Maine has among the country's most generous Medicaid standards. Around a quarter of the state's residents are in the program, which costs $2.6 billion a year.

To help cover a nearly $1 billion budget gap, Mr. LePage wants the Obama administration to let Maine drop its standard to match the federal ceiling—a move he says would save the state at least $70 million a year. He says the administration is so far refusing to grant the state an exemption.

The health law allows states that have budget deficits to eliminate certain higher-earning enrollees, though that provision applies only in a narrow amount of cases.

"We are being penalized for being overly generous," said Mr. LePage. "All we are asking for is latitude in how we work our own system."

The state of Washington wants flexibility in the rates its pays health-care providers that treat Medicaid patients, the services it offers and its eligibility requirements.

"In our state, the least attractive of those tools is to just cut people off the program," said Jonathan Seib, a health-policy adviser to Gov. Gregoire, who is chairwoman of the National Governors Association. "But it's an authority we'd like to have in order to manage our budget."

Delaware Gov. Jack Markell, a Democrat, may also pursue a waiver to reduce Medicaid eligibility. "We haven't ruled anything particular in or out yet," Mr. Markell said, adding that it has been difficult to rein in Medicaid costs and "the population that qualifies has increased significantly."

Some states have had to step back from planned Medicaid cuts after meeting political resistance. Washington halted a plan to cut adult prescription-drug coverage, and South Carolina reversed a decision to cut hospice care, both after an outcry from the health community.

In Mississippi, Republican Gov. Haley Barbour says he has reduced his state's Medicaid rolls 20% by simply requiring all recipients to apply annually in person to prove their eligibility. He believes he could make further advances by requiring annual physicals, a step he says the federal government doesn't allow.

"The administration is granting waivers out the yin yang to businesses and everyone else," he said. HHS has exempted more than 700 employers and others from providing richer insurance benefits mandated under the health law. "We'd like a little of that leeway, too."

Sunday, February 27, 2011

How Budget Battles Go Without the Earmarks

From The New York Times:

The fact that Congress remains a spending disagreement or two away from shutting down the government no doubt strikes some as remarkable. But there is another extraordinary aspect to the fiscal clash unfolding on Capitol Hill: earmarks have disappeared from the budgetary landscape.

It is still sinking in for both those who have lavished money on hometown projects and those who have spent years opposing earmarks that the pork-barrel spending that has driven so many appropriations measures through the House and Senate is, at least for now, at an end.

Even Speaker John A. Boehner of Ohio, who made battling earmarks a cornerstone of his Congressional career since his election in 1990, said he would not have predicted that Congress could kick the habit.

“Think of this fight we have had for 20 years,” Mr. Boehner said in a recent interview. “If somebody would have asked me, ‘Will you ever get there?’ I would have had my doubts.”

But through a confluence of events, Mr. Boehner and the rest of the anti-earmark crowd did get there; the impact of the decision by leaders of the House and the Senate to ban earmarks for at least the next two years is already being felt.

Lawmakers said the absence of earmarks . . . for a more freewheeling debate on the House floor during consideration of the Republican plan to slash $61 billion from this year’s budget since Democrats and Republicans were not caught up in protecting the special provisions they had worked so hard to tuck into the spending bill.

“This is a completely new experience, and a good one,” said Representative Jeff Flake, an Arizona Republican who had lost scores of attempts on the House floor to strip earmarks from spending bills.

While spending on earmarks is a tiny portion of the budget, critics like Mr. Flake and Mr. Boehner said they played an insidious role in pushing up federal spending through what is known in legislative terms as logrolling.

Top members of the Appropriations Committee might, for instance, grant a lawmaker’s request for a few million dollars for an important project back home. That lawmaker would then be obligated to support the entire multibillion-dollar bill despite possible reservations. Woe to the person who gets an earmark and then opposes the bill; chances for a future earmark would be somewhere between zero and none.

Logrolling was just one aspect of earmarks seized on by critics. The pursuit of such spending ended up in criminal charges in some cases as certain lawmakers and lobbyists crossed the line between arguing for an issue and conspiring to secure federal dollars. The burgeoning practice fueled an entire industry where lawmakers relied on lobbyists for campaign aid and lobbyists expected earmark help in return.

Given the hold that the push for earmarks had on both parties in Congress, it took powerful forces to lead to a ban. Mr. Boehner may have railed against them, but it took over-the-top examples like the Bridge to Nowhere in Alaska to focus public attention on the practice.

At the same time, the two parties found themselves in a bidding war over who was tougher on earmarks.

The wall finally tumbled down this year when Mr. Boehner, installed as the new speaker, pushed a ban in the House and had the clout to make it stick.

In the Senate, Mitch McConnell of Kentucky, a rabid earmarker, finally took the cure. Then, under pressure from the White House, Senate Democrats agreed to a ban, though Senator Harry Reid of Nevada, the majority leader, did so grudgingly, arguing that it was the job of Congress to direct federal spending.

Whether prohibition will last is anyone’s guess. But with Congress now so focused on cutting spending, it is doubtful that the days of unbridled earmarking will return anytime soon.

Saturday, February 26, 2011

Let's split some hairs here: Do tell - APS official believes she’s a scapegoat

Tamara Cotman is accused of urging APS principals to send "go to hell" memos to officials investigating cheating. She said she passed out the forms to help principals vent their frustrations.

From the AJC:

The high-level Atlanta Public Schools official accused of telling principals to send “go to hell” memos to state investigators thinks she has become a scapegoat in a systemwide cheating scandal.

“Absolutely, I really do,” Tamara Cotman, who was reassigned last week from a job supervising about two dozen schools, told Channel 2 Action News in an interview aired Friday.

The Atlanta Journal-Constitution reported on the episode Feb. 13. Cotman declined several requests for interviews from the AJC and had made no statements on the matter until she spoke with the television station, nearly two weeks after the allegation became public knowledge.

“I think the school system has been totally disingenuous with Ms. Cotman,” her lawyer, George Lawson, told the television station. “I think that they have run for the woods.”

Cotman said she met with state investigators for eight hours Thursday. In the interview, she sought to put a fine point on her actions in the Nov. 17 meeting with principals.

She said she did pass out blank “go to hell” sheets — but did not speak disparagingly of state investigators.

She said she was right to encourage principals to vent their frustrations — but did not single out the investigators for condemnation.

Indiana Gov. Mitch Daniels - The Governor Who Cut His State Down to Size

From The Wall Street Journal:

Pundits say he's too short, at 5-foot-7, and lacks the requisite pizzazz to be elected president.

Indiana Gov. Mitch Daniels believes he faces a taller challenge as he ponders a White House run: Could voters warm to his message that the country is doomed unless it slashes its debt and radically revamps the popular Social Security and Medicare programs?

In any other year, a campaign platform that gloomy would render a politician toxic. Today, with concerns over the nation's fiscal health on the rise, the Indiana Republican's wonkish bravado is making some think he is a good fit for the moment.

If the time is indeed right for Mr. Daniels's get-tough message, the angry budget standoffs in states such as Wisconsin, Ohio and New Jersey are also shining a new light on his credentials as a messenger. Mr. Daniels rescinded collective-bargaining rights for state employees six years ago—long before Wisconsin Gov. Scott Walker caused a firestorm by putting the same issue on the table.

Mr. Daniels also cut spending, trimmed the state work force to its smallest in decades, and turned a yawning deficit into a surplus, with only scattered outbursts of popular anger along the way.

He has emerged from all this with high marks from voters, and a profile that sets him apart from the other Republicans mulling a possible 2012 run.

The 61-year-old former adviser to Presidents Ronald Reagan and George W. Bush says he is still pondering whether "to jump off the highest cliff in politics" and make a run for the White House. He is a dark horse, tied for seventh among possible Republican candidates in a recent Gallup poll. If others "step out boldly" with plans to revamp the entitlement programs, he says, "I will probably be for them."

So far, he says, none has.

Harping on deficits and changes to entitlements, Mr. Daniels concedes, isn't usually a winning strategy. "It's hard to name anyone who has won on that theme," he says.

The Pew Research Center found this month that even at a time of rising concern over deficit spending, only 12% of Americans, and just a fifth of Republicans, favored cutting Social Security or Medicare.

Thursday, February 24, 2011

Arizona Lawmakers Push New Round of Immigration Restrictions

From The New York Times:

Arizona lawmakers are proposing a sweeping package of immigration restrictions that might make the controversial measures the state approved last year, which the Obama administration went to court to block, look mild.

Illegal immigrants would be barred from driving in the state, enrolling in school or receiving most public benefits. Their children would receive special birth certificates that would make clear that the state does not consider them Arizona citizens.

Some of the bills, like those restricting immigrants’ access to schooling and right to state citizenship, flout current federal law and are being put forward to draw legal challenges in hopes that the Supreme Court might rule in the state’s favor.

Wednesday, February 23, 2011

Reagan Firings Signaled End to Strike Era

From The Wall Street Journal:

President Ronald Reagan's showdown with the Professional Air Traffic Controllers Organization began a 30-year decline in the use of union strikes.

In August 1981, the union of government employees who guided plane travel called a strike for better pay and working conditions. Mr. Reagan, citing a federal law that prohibits strikes by government unions, ordered them back to work. More than 11,000 PATCO members defied the order. Mr. Reagan fired them.

The showdown in Mr. Reagan's first term had a big effect on unions and employers. In 1981, unions called 145 major strikes, according to the Labor Department. In 1982, there were 96 major strikes. Strikes continued to decline as globalization made it increasingly difficult for workers, particularly in manufacturing, to sustain lengthy walkouts. In 2010, there were 11 major strikes, up from five the year before.

It's Crunch Time for Organized Labor

From The Wall Street Journal:

Labor unions are facing the most direct challenge to their political and financial clout since Ronald Reagan broke the air-traffic controllers union 30 years ago.

Across the industrial Midwest, a union stronghold long vital to Democrats and key to President Barack Obama's re-election prospects, Republicans are trying to roll back the powers of not just public-employee unions but also the bargaining and dues-collecting power of groups that represent auto workers and carpenters.

Democratic members of Indiana's House of Representatives refused to show up for work Tuesday, in an effort to block debate on a Republican-backed "right to work" bill that would give employees the ability to opt out of paying union dues even in a union-represented shop. Such laws are in force in 22 states.

Democratic members of Wisconsin's Senate continued their boycott of the legislative session, effectively blocking action on proposals to curtail bargaining power for state public unions. Gov. Scott Walker said 1,500 state workers could lose their jobs by July if his proposal doesn't pass.

Republicans in Michigan, meanwhile, are working on a bill to make the home of General Motors Corp. and Ford Motor Co. a right-to-work state.

Lawmakers in those states and Ohio have sparked widespread protests with proposals to restrict longstanding collective-bargaining rights or to weaken the grip of private-sector unions that represent more than a million workers.

The actions follow elections last fall that put GOP governors and Republican majorities in charge of statehouses across the region. Several of the new governors ran campaigns promising to go after public union benefits and to weaken their bargaining powers.

Gov. Walker and other Republicans say they have no choice as states struggle to cover huge budget gaps. Gov. John Kasich, who is pushing a similar measure in Ohio over heated union opposition, says the moves are not an attack on unions, but an effort "to restore some balance."

"We have finally elected people who are doing what they said they would do," said U.S. Sen. Ron Johnson, the newly elected Republican from Wisconsin, who supports efforts to trim labor's powers. "I certainly hope that voters will stand by Gov. Walker when he makes these tough decisions."

Some Republicans and conservative groups also argue that pro-union laws and policies are putting states in the industrial Midwest at a disadvantage in competition for jobs with right-to-work states, where unions are weak and they cannot compel workers to join or pay dues.

"Being a right to work state would bring jobs to Indiana," said Republican State Rep. Jerry Torr, a sponsor of the right-to-work measure in Indiana.

Government figures show that inflation-adjusted per capita income in six right-to-work states increased at a 6.9% annual rate over the past 10 years. In contrast, incomes contracted at a 0.5% rate in six unionized upper-Midwest states over the same period, as many high-paying automotive and other manufacturing jobs disappeared and foreign auto makers concentrated nearly all of their new investment in right-to-work states.

Still, Wisconsin's unemployment rate in December 2010 was lower, at 7.5%, than the jobless rate in some right-to-work states such as Texas, at 8.3%, or Alabama, at 9.1%, according to Labor Department statistics.

Democrats and labor leaders are denouncing the legislative moves as an effort to dismantle the labor movement and deprive the Democratic Party of one of its largest sources of money. Unions spent about $400 million on ads and get-out-the-vote efforts to help elect Mr. Obama and other Democrats in 2008.

"Stripping away workers' rights is something we cannot as Democrats allow to happen," said Wisconsin Democratic Senate minority leader Mark Miller, who fled the state Thursday in his 2002 Chevy Prism.

AFL-CIO Chief Economist Ron Blackwell says unions are prepared to bargain over financial issues. But proposals to curb or end collective-bargaining rights "pose an existential threat to collective bargaining in the public sector," he said.

The Republican and Democratic parties have plunged into the Wisconsin fight. The Democratic National Committee has revved up its network of activists and helped bus protestors to Madison, as have conservative groups on the other side. Unions are funding advertisements opposing the Republican legislation.

President Barack Obama last week criticized Gov. Walker's proposal to curtail union bargaining rights. But the president's spokesman, Jay Carney, on Tuesday declined to comment further on the Wisconsin or Ohio situations. Mr. Obama visited Cleveland Tuesday to promote his jobs agenda with small business owners. Meanwhile, demonstrators converged in Columbus to protest a legislative proposal to strip most collective-bargaining rights from the state's 400,000 public employees.

Some Republican leaders in the region are expressing reluctance to support measures that would undermine private-sector unions' ability to collect dues. Indiana Gov. Mitch Daniels, a potential 2012 Republican presidential candidate, has said he preferred to avoid the distraction of a fight on the issue this session. Michigan's Republican Gov. Rick Snyder has distanced himself from a similar proposal.

Democrats say Republicans are over-reaching, and contend that the legislative battles have injected energy into their ranks that could undermine support for Republicans in key swing states like Wisconsin and Ohio.

Union leaders backed losing candidates across the upper Midwest in 2010, and have so far struggled to benefit from anxiety about job security and wages.

A Rasmussen poll released Monday found that 48% of likely voters supported Gov. Walker in the ongoing face-off in Wisconsin, while 38% sided with the unions. But a Gallup/USA Today poll conducted Monday found that 61% of Americans could oppose taking away collective-bargaining rights in their states.

Other polls have found an overall ambivalence about the role of public-sector unions. A Pew Research Center survey done just before the Wisconsin fight found that 48% of Americans held favorable views of public-sector unions, while just under half told an earlier Pew poll that they favored cutting public-sector pensions to help curb state budget deficits.

At the same time, the ranks of unionized government workers have continued to swell, along with the size of their pensions and benefits. Even while promising to go after the government unions, Mr. Walker last November got the support of more than a third of all union households in Wisconsin.

Labor experts say the Wisconsin fight could have an impact on unions at least as lasting as President Reagan's firing in 1981 of 11,000 striking air-traffic controllers. That move permanently weakened the threat of labor strikes by making it easier for private-sector employers to hire replacement workers.

In 1981, about one in five U.S. workers belonged to a union. By 2010, the share in a union had dropped to 11.9% overall. But more than half of those union members work in public sector jobs, where the unionization rate in 2010 was 36%, federal data show. In the private sector, unionization has fallen below 7%.

Despite slumping union membership over the years, Wisconsin holds a central place in the history of the U.S. labor movement—which is one reason the fight there has gotten so hot. It was the first state to pass an unemployment insurance law, in 1932, and the first, in 1959, to give workers the legal right to collectively bargain.

Tuesday, February 22, 2011

David Brooks: The process has to be balanced. It has to make everybody hurt.

David Brooks writes in The New York Times:

Over the past few weeks we’ve begun to see the new contours of American politics. The budget cutters have taken control of the agenda, while government’s defenders are waging tactical retreats. Given the scope of the fiscal problems, it could be like this for the next 10 or 20 years.

No place is hotter than Wisconsin. The leaders there have done everything possible to maximize conflict. Gov. Scott Walker, a Republican, demanded cuts only from people in the other party. The public sector unions and their allies immediately flew into a rage, comparing Walker to Hitler, Mussolini and Mubarak.

Walker’s critics are amusingly Orwellian. They liken the crowd in Madison to the ones in Tunisia and claim to be fighting for democracy. Whatever you might say about Walker, he and the Republican majorities in Wisconsin were elected, and they are doing exactly what they told voters they would do. It’s the Democratic minority that is thwarting the majority will by fleeing to Illinois. It’s the left that has suddenly embraced extralegal obstructionism.

Still, let’s try to put aside the hyperventilation. Everybody now seems to agree that Governor Walker was right to ask state workers to pay more for their benefits. Even if he gets everything he asks for, Wisconsin state workers would still be contributing less to their benefits than the average state worker nationwide and would be contributing far, far less than private sector workers.

The more difficult question is whether Walker was right to try to water down Wisconsin’s collective bargaining agreements. Even if you acknowledge the importance of unions in representing middle-class interests, there are strong arguments on Walker’s side. In Wisconsin and elsewhere, state-union relations are structurally out of whack.

That’s because public sector unions and private sector unions are very different creatures. Private sector unions push against the interests of shareholders and management; public sector unions push against the interests of taxpayers. Private sector union members know that their employers could go out of business, so they have an incentive to mitigate their demands; public sector union members work for state monopolies and have no such interest.

Private sector unions confront managers who have an incentive to push back against their demands. Public sector unions face managers who have an incentive to give into them for the sake of their own survival. Most important, public sector unions help choose those they negotiate with. Through gigantic campaign contributions and overall clout, they have enormous influence over who gets elected to bargain with them, especially in state and local races.

As a result of these imbalanced incentive structures, states with public sector unions tend to run into fiscal crises. They tend to have workplaces where personnel decisions are made on the basis of seniority, not merit. There is little relationship between excellence and reward, which leads to resentment among taxpayers who don’t have that luxury.

Yet I think Governor Walker made a strategic error in setting up this confrontation as he did. The debt problems before us are huge. Even in Wisconsin they cannot be addressed simply by taking on the public sector unions. Studies done in North Carolina and elsewhere suggest that collective bargaining only increases state worker salaries by about 5 percent or 6 percent. That’s not nearly enough to explain current deficits. There are many states without collective bargaining that still face gigantic debt crises.

Getting state and federal budgets under control will take decades. It will require varied, multipronged approaches, supported by broad and shifting coalitions. It’s really important that we establish an unwritten austerity constitution: a set of practices that will help us cut effectively now and in the future.

The foundation of this unwritten constitution has to be this principle: make everybody hurt. The cuts have to be spread more or less equitably among as many groups as possible. There will never be public acceptance if large sectors of society are excluded. Governor Walker’s program fails that test. It spares traditional Republican groups (even cops and firefighters). It is thus as unsustainable as the current tide of red ink.

Moreover, the constitution must emphasize transparent evaluation. Over the past weeks, Governor Walker increased expenditures to pump up small business job creation and cut them on teacher benefits. That might be the right choice, but if voters are going to go along with choices such as these, there is going to have to be a credible evaluation process to explain why some things are cut and some things aren’t.

So I’d invite Governor Walker and the debt fighters everywhere to think of themselves as founding fathers of austerity. They are not only balancing budgets, they are setting precedent for a process that will last decades. By their example, they have to create habits that diverse majorities can respect and embrace. The process has to be balanced. It has to make everybody hurt.

Monday, February 21, 2011

As Republicans See a Mandate on Budget Cuts, Others See Risk

From The New York Times:

In Congress and in statehouses, Republican lawmakers and governors are claiming a broad mandate from last year’s elections as they embark on an aggressive campaign of cutting government spending and taking on public unions. Their agenda echoes in its ambition what President Obama and Democrats tried after winning office in their own electoral wave in 2008.

In Washington, the House approved more than $60 billion in spending cuts before dawn on Saturday that would hit virtually every area of government, setting up a showdown with Senate Democrats and the White House.

In New Jersey, Gov. Chris Christie, who is embroiled in a political fight with the teachers’ union, is expected to call for drastic steps on Tuesday to close a roughly $10 billion budget gap.

And nowhere has a newly elected Republican flexed more muscle or drawn a more severe backlash than in Wisconsin, where Gov. Scott Walker is pushing to curtail collective bargaining rights for state employees. “For us, this is about balancing the budget,” Mr. Walker said on “Fox News Sunday.” “We’ve got a $3.6 billion budget deficit. We are broke. Just like nearly every other state across the country, we’re broke.”

But in the view of officials from both major political parties, Republicans may be risking the same kind of electoral backlash Democrats suffered after they were perceived as overreaching.

Public surveys suggest that most voters do not share the Republicans’ fervor for the deep cuts adopted by the House, or for drastically slashing the power of public-sector unions. And independent voters have historically been averse to displays of political partisanship that have been played out over the last week.

Mr. Walker’s plan includes banning unions from bargaining over issues other than wages, stopping the deduction of union dues from state paychecks and requiring annual elections for unions to stay in existence.

At the very least, the huge demonstrations in Wisconsin over Mr. Walker’s efforts suggest that the Republicans have succeeded in doing what Mr. Obama was unable to do last year: energize the Democratic base.

In addition, several Democrats pointed to Republican efforts to cut back abortion rights as another example of an issue that made them subject to the same criticism that Democrats faced: pursuing their party’s base agenda while ignoring the central concern of Americans, jobs.

In a New York Times/CBS News poll in January, 43 percent of respondents said job creation was the most important issue for Congress; 14 percent cited reducing the federal deficit.

Michael Dimock, the associate director of research for the Pew Research Center, said its polling had found that while voters were eager to reduce the deficit, they also supported increases in spending on Social Security and Medicare and believed that tax increases would be needed to balance the budget.

“The spending-deficit issue is the trickiest issue for Republicans,” Mr. Dimock said. “It’s clear that the public is with them in principle — smaller government doing less — but it’s unclear whether they’re with them in practice.”

Sunday, February 20, 2011

Deficits Reshape the Debate as Republicans Jockey for 2012

From The New York Times:

Gov. Mitch Daniels of Indiana described the nation’s fiscal condition in dark terms more often reserved for a terror threat, declaring, “We face an enemy lethal to liberty and even more implacable than those America has defeated before.”

Gov. Chris Christie of New Jersey argued that the country was headed toward financial ruin if leaders did not summon the courage to tackle the most politically charged aspects of the problem, saying: “You’re going to have to raise the retirement age for Social Security. Oh, I just said it, and I still am standing here. I did not vaporize into the carpet!”

Former Gov. Sarah Palin of Alaska said Republicans would be on the hook, along with Democrats, if runaway spending was not controlled in Washington, declaring, “Tone-deaf politicians are going to be fired, and they’re going to be replaced in the next election cycle.”

Budget deficits and the nation’s growing debt load have emerged in the last few weeks as the consuming issues in Washington and in state capitals, and they are now shaping the early stages of the race for the 2012 Republican presidential nomination. Not a single candidate has formally opened a campaign yet — and some of those delivering the toughest talk on the budget may never do so — but the subject is giving focus and energy to a contest that has so far been largely unformed.

The growing profile of the issue has given Republicans an opportunity to cast President Obama as a weak leader, unwilling or unable to confront the tough issues, and has added fuel to the conservative drive for smaller government.

But it has also highlighted divisions among Republicans about how aggressively to cut domestic spending; the wisdom of supporting specific steps to address long-term problems in Medicare, Medicaid and Social Security; and the proper balance between emphasizing fiscal issues and social ones like same-sex marriage.

And with the Republican-controlled House voting to cut deeply into this year’s federal budget and state capitals producing their own volatile showdowns, it has underscored the opportunity for potential candidates to seize on a fiscal-themed message to break out of the pack.

As a result, a presidential race that once seemed poised to be a straight referendum on Mr. Obama’s record — with a particular focus on the health care law, the unemployment rate and criticism over the expansion of government regulation — now seems likely to focus more at the outset on how aggressively the country should be reassessing the size and role of government and the future of the social welfare system.

Candidates in both parties have learned the hard way over the years about the risks of advocating changes to Medicare, Medicaid and Social Security, and it is not clear whether voter sentiment has changed enough to reward blunt talk this time around — or whether positions taken in a primary driven by conservative voters might be problematic for the eventual nominee in the general election.

But with the anger and energy that animated the Tea Party movement last year still coursing through politics, how Republicans navigate fiscal issues could be just as critical to their primary campaign as the Iraq war was to the Democratic nominating contest four years ago.

Saturday, February 19, 2011

A Watershed Moment for Public-Sector Unions: Could begin a decline in the power of public unions - both at the bargaining table & in politics.

From The New York Times:

In the half century since Wisconsin became the first state to give its public workers the right to bargain collectively, government employee unions have mushroomed in size and power — so much so that they now account for more than half of the nation’s union members.

But the legislative push by Wisconsin’s new governor, Scott Walker, a Republican, to slash the collective bargaining rights of his state’s public employees could prove a watershed for public-sector unions, perhaps signaling the beginning of a decline in their power — both at the bargaining table and in politics.

Three-fourths of the states allow collective bargaining by some or all of state or local government employees. And labor’s friends and foes alike agree that if the Wisconsin legislation passes, it will create momentum for similar bills in Ohio, Indiana and other states.

“These kinds of high-profile public-employee battles have enormous stakes,” said Benjamin Sachs, a professor of labor law at Harvard. “We’re still feeling the consequences of President Reagan confronting the union in the air controllers’ strike. For anyone interested in union rights, the fight in Wisconsin couldn’t be more important.”

From Florida to California, many political leaders are seeking to cut the wages and benefits of public-sector workers to help balance strained budgets.

But Mr. Walker is going far beyond that, seeking to definitively curb the power of government unions in his state. He sees public-employee unions as a bane to the taxpayer because they demand — and often win — generous health and pension plans that help push up taxes and drive budget deficits higher.

To end that cycle, he wants to restrict the unions to bargaining over just one topic, base wages, while eliminating their ability to deal over health care, working hours and vacations. Moreover, he wants to require unions to win an employee election every year to continue representing workers.

By flooding the State Capitol in Madison with more than 10,000 protesters, labor unions are doing their utmost to block Mr. Walker’s plans. They helped persuade Democratic state senators to slip out of the building this week to deny Republicans the quorum they needed to pass the legislation.

Democrats say the governor’s “budget repair bill” — strongly supported by the Republicans who control both legislative houses — is political payback, intended to cripple public-sector unions, which spent more than $200 million to back Democrats across the country in November’s elections.

Mr. Walker denies any such notion, saying he simply wants to curb union bargaining rights and bring public workers’ wages and benefits in line with the private sector. “It’s not about the unions,” he said this week. “It’s about balancing the budget.”

Christopher Policano, a spokesman for the American Federation of State, County and Municipal Employees, said his union was willing to negotiate concessions with Mr. Walker, “but he wants to throw out the bargaining table.”

Mr. Walker has repeatedly argued that most Wisconsin residents back his legislation. After visiting a factory this week, he said that private-sector workers often complain that public employees receive more generous health and pension benefits than they do.

There is no question that public-sector unions and the thousands of contracts they have negotiated over the years have improved wages and pensions of government workers and made government service more attractive. But union leaders are quick to point to studies showing that overall compensation for government employees is slightly lower than for private-sector employees of comparable age and education.

Also embedded in the Wisconsin debate — and reaching well beyond that state — is a more fundamental dispute over the role, even the legitimacy, of public-sector unions. Like Mr. Walker, Ohio’s new governor, John Kasich, and Indiana’s second-term governor, Mitch Daniels, both Republicans, see public-sector bargaining as something to be banned or severely restricted because of its effect on taxpayers and government budgets.

Some Republicans quote President Franklin D. Roosevelt, a Democrat, who bridled at public-sector unionism and once said, “The process of collective bargaining, as usually understood, cannot be transplanted in the public service.”

Republicans say the Democrats have embraced the government employees’ cause because weaker unions would reduce crucial political support for Democratic candidates. Republicans have often denounced what they say is a squalid deal in which public-sector unions spend generously to elect allies to office and then those allies lavish generous wages and benefits on union members.

Ever since Wisconsin gave its government employees the right to bargain in 1959, it has generally been Democrats who have extended that right in other states. In 1962, President John F. Kennedy gave most federal employees the right to unionize and bargain collectively.

The national importance of the Wisconsin fight is clear. President Obama weighed in on labor’s behalf on Wednesday, calling Mr. Walker’s proposals “an assault on unions.” And the House speaker, John A. Boehner, Republican of Ohio, praised Mr. Walker for “confronting problems that have been neglected for years at the expense of jobs and economic growth.”

Citing an anticipated budget deficit of $137 million this year and a $3.6 billion shortfall over the next two years, Mr. Walker argues that his measures to curb union power and bargaining are essential to help balance the budget. Union leaders say that several of Mr. Walker’s proposals — including the one that would require elections each year to determine whether a majority of public employees want to keep their union — are really intended to cripple unions, not balance the budget.

Other governors, Democrat and Republican, are also grappling with budget deficits. But many of those governors, like Jerry Brown of California and Andrew M. Cuomo in New York, both Democrats, and Rick Snyder of Michigan, a Republican, are not trying to strip bargaining rights. They are instead using public pressure and the threat of layoffs to persuade public-sector unions to make far-reaching concessions.

“Wisconsin has become ground zero for the process of pushing back against unions,” said Steve Meyer, a professor of labor history at the University of Wisconsin-Milwaukee. “People are waiting to see what happens here. That’s why the labor movement has become so deeply involved trying to stop this process.”

As happens so often in today’s increasingly partisan politics, the battle reflects how differently Republicans and Democrats view a particular subject — in this case, unions and their power. Many Republicans see public-sector unions as greedy, powerful special interests that are taking too many taxpayer dollars. Many Democrats see them as natural allies and a vital part of a labor movement that has helped build the nation’s middle class.

The furious demonstrators in Madison have shown that public-sector unions still wield real power. But if the Legislature enacts Mr. Walker’s bill, a tipping point might well be reached, with the power of public-sector unions tilting into decline.

Another Senate Democrat Won't Run

From The Wall Street Journal:

Sen. Jeff Bingaman, a New Mexico Democrat, announced Friday that he will not run for re-election next year, putting another seat in play as his party seeks to hold onto its Senate majority.

With his decision not to seek a sixth six-year term, the 67-year-old becomes the fourth senator aligned with Democrats not to run for re-election, joining Sens. Kent Conrad of North Dakota, Jim Webb of Virginia and Joe Lieberman, the Connecticut independent who caucuses with Democrats. Democrats currently wield a six-seat Senate majority, including Mr. Lieberman and Vermont independent Bernie Sanders.

To those progressives sending me nasty emails, know this: This is most unfortunate. - Talks to Cut Deficit Stumble In Heated White House Meeting

From The Wall Street Journal:

Top Senate Democrats tried to scotch efforts by Majority Whip Richard Durbin to include Social Security in comprehensive deficit-reduction negotiations, illustrating the challenge facing the bipartisan talks.

The discussion occurred during a closed-door White House meeting this week among negotiators including Democratic Senate Majority Leader Harry Reid of Nevada and Sen. Charles Schumer of New York, a key lieutenant.

President Barack Obama attended, although his contribution to the conversation couldn't be learned. Previously, the administration has offered general support for bipartisan debt-reduction talks.

The confrontation, as well as a flare-up on the right over taxes, illustrates the difficulty of reaching a deal on deficit-control legislation, and how fear of upsetting the party line on particular policies could trump the issue of controlling the debt.

Responding to public unease about the country's fiscal standing, six senators including Mr. Durbin are negotiating a deficit-reduction framework. They are betting that worries about federal red ink—expected to exceed $1.6 trillion this fiscal year—will put once-untouchable factors, such as entitlement spending and tax increases, into the mix.

One proposal, built off the presidential debt commission's recommendations, would establish caps on discretionary and entitlement spending. Lawmakers would then have to draft legislation to meet those caps or face automatic, across-the-board spending cuts if they fail.

On taxes, lawmakers would have two years to raise revenue by simplifying the tax code, killing deductions and credits and lowering overall rates. Under the deal being discussed, if Congress fails, provisions would kick in automatically to trim tax deductions.

If Democratic negotiators are forced to take Social Security out of the discussions, Republicans could counter by refusing to discuss tax changes that raise revenue. With only Medicare and Medicaid left, talks would likely collapse, said Erskine Bowles, a former Clinton White House chief of staff who co-led Mr. Obama's deficit commission last year. Limiting the scope of negotiations "is the exact wrong thing to do," Mr. Bowles said.

Sen. Tom Coburn (R., Okla.), one of those involved in the bipartisan talks said "purists on both sides" need to abandon their entrenched positions. For Republicans, that would mean ending or limiting hundreds of tax deductions and exemptions. For Democrats, the issue is Social Security. "For a deal to happen, Social Security needs to get fixed," Mr. Coburn said.

Sens. Reid and Schumer want any talk of changes to Social Security to be dealt with separately from the broader deficit-reduction talks. Mr. Schumer wants to protect the sizable number of incumbent Democrats facing elections in 2012 from having to make tough votes on the program.

Democratic interest groups have been gearing up for a fight on Social Security, and Messrs. Schumer and Reid don't want to get in the way. On Friday, Edward Coyle, executive director of the liberal Alliance for Retired Americans, accused House Republicans of threatening Social Security with the spending cuts they are pressing for the current fiscal year. But negotiators appear to be holding firm.

"If Sen. Schumer is serious about fighting to protect Social Security from harmful cuts, he can join the large group of Members already doing that," said a Senate official involved in the bipartisan negotiations. "But if he's trying to use Social Security as an excuse to do nothing to reduce the deficit, he's going to be pretty lonely."

A spokesman for Mr. Schumer, Brian Fallon, said the senator "believes it is vital to rein in the deficit, but Social Security is not the nub of the problem, and focusing on it distracts from any serious effort to bring the budget into balance."

The White House meeting Wednesday took place before The Wall Street Journal published an article Thursday detailing the Senate negotiations. The substance of the talks somewhat eased the concern of the Democratic leaders about Social Security, and gave Sen. Durbin some room to press forward, though without any commitment of support.

Aides familiar with the talks say Democratic leaders are willing to let them play out. A framework for deficit-cutting legislation could be circulated to a broader group of senators when they return early next month after a Presidents Day recess.

According to aides familiar with the bipartisan talks, Social Security is being treated gingerly. Under one proposal, lawmakers would be given two years to draft an overhaul to put the system on sounder financial footing. If that effort fails, Congress would be required to vote on the presidential debt commission's Social Security plan, which would raise the amount of income subject to Social Security taxes, gradually raise the retirement age and slow the annual growth of benefits.

Under the initial discussions, negotiators don't appear to be inclined to include penalties, should the Senate vote down any changes to Social Security.

For the first time since 1983, Social Security payouts exceeded Social Security taxes last year, according to the Social Security trustees report of 2010.

The government has borrowed billions of dollars from Social Security for decades, and the system owns enough federal bonds to keep it solvent until 2037, but as those bonds come due, the government will have to take money from the general Treasury to pay them off, adding another strain to the budget.

"We have a moral obligation to make sure Social Security will be solvent for the next 75 years," Mr. Bowles said, "and if we don't make these tough choices, it won't be."

Similar tensions are playing out on the right. Grover Norquist, president of Americans for Tax Reform, a conservative group, wrote to the three main Republican negotiators, Sens. Coburn, Saxby Chambliss of Georgia and Mike Crapo of Idaho, calling the putative deal a violation of the group's "no new taxes" pledge, which most Republican lawmakers have signed.

"There's no real bill to talk about with a tax increase," Mr. Norquist said of the deficit negotiations Friday.

The three senators fired back, saying their negotiations affirm "the oath we have taken to support and defend the Constitution of the United States against all enemies, foreign and domestic, of which our national debt may now be the greatest."

Friday, February 18, 2011

Sens. Chambliss and Warner discuss deficit working group on NewsHour with PBS's Judy Woodruff (2-17-11)

David Brooks: Tomorrow Never Comes

A Wednesday post entitled "Six senators—three Democrats and three Republicans—hope to finish converting the debt commission's recommendations into legislative language" reported the following:

Mr. Obama suggested that people pressing for answers on the big budget questions were impatient. "My goal is to actually solve the problem. It's not to get a good headline on the first day," he said. [Please! Spare us.]

The bracketed language [Please! Spare us] was my editorial comment asking the President to please spare us the baloney and his failure to get with the program that at one time he talked the talk but not walked the walk. As noted in earlier posts, he completely failed to take the initiative in his State of the Union address. Thus saying something that can justifiably be construed as being critical of others willing to tackle the deficit is most inappropriate.

Today David Brooks, one of the commentators that President Obama monitors, notes the same in his column in The New York Times entitled "Tomorrow Never Comes."

Jonathan Alter wrote a book about Barack Obama’s first year in office called “The Promise.” That’s a great title because it works on so many levels. For example, over the past four years, Obama’s career has been marked by a constant promise: He has continually said he is on the verge of doing something serious abut the national debt.

He started making the promise back when he was in the Senate. In “The Audacity of Hope,” published in 2006, he expressed alarm at the “mountain of debt” caused by $300 billion annual budget deficits. (They’re now $1.6 trillion.) During the presidential campaign, he pledged to put away childish things and tackle the tough budget issues.

During the transition, he said the time to act on the debt is now. “What we have done is kicked the can down the road,” he told The Washington Post. “We are now at the end of the road and are not in a position to kick it any further.” He said he would start a budget initiative in February 2009.

After the stimulus package passed, he and his aides said it would soon be time to turn to deficit issues. The same promise was made after health care reform. He made the pledge yet again at a press conference this week. Right now is not the time, the president always says, but tomorrow we will get serious.

But tomorrow never comes.

The biggest tease came last year when the president’s debt commission announced its report. That report produced a series of great conversations. But, yet again, words do not translate into action. The message of the president’s 2012 budget is: Not yet. We’ll get serious tomorrow.

The budget has some fine features. I’ll soon be writing a column about how many of its provisions are better than anything the Republican Party is proposing. But it is laughably inadequate compared with the fiscal problems before us.

In 2012, the only year this budget controls, the president would actually increase the deficit with more spending. Roughly two-thirds of the alleged savings would nominally kick in after 2016. The budget imagines that $328 billion in financing for transportation projects will magically appear. While ignoring tax reform, it lards up the tax code with another layer of special preferences. The Committee for a Responsible Federal Budget calculates that $780 billion of the proposed deficit cuts are politically dubious.

The budget gets a lot of little things right, but it squanders the opening created by the debt commission. It fails to touch the big programs or ask for any shared sacrifice from the American people.

Two explanations are commonly offered to explain why the White House decided to kick the can down the road. Some analysts say the Democrats are trying for a repeat of 1995: Do nothing on the deficit; goad the Republicans into announcing entitlement cutbacks and then savage them on the campaign trail for cutting off granny.

I don’t believe this is in the president’s head. It would be morally reprehensible to bankrupt the nation for the sake of a campaign theme. Obama is not that sort of person.

The other explanation is that Obama is following the model of the 1983 Social Security deal. Be patient, the president argued at his press conference this week. If I lead from the front my proposal will get stymied in the partisan circus. Better to lead from the back and have negotiations in private with Republican leaders. Then when the time is ripe, we’ll cut a deal outside the glare of the scream machine.

The president and his aides may really believe in this strategy, but it is wrong. This is not like fixing Social Security in the early 1980s. The current debt problem is of an entirely different scale. It requires a rewrite of the social contract, a new way to think about how the government pays for social insurance.

The president has enormous faith in getting smart people around the table and initiating technocratic reform. But you can’t renegotiate the social contract in private. You have to have public buy-in. You have to spend years out in public educating voters about the size of the problem and what will be required. You have to show voters what a solution looks like.

The New Deal wasn’t passed by a president who led quietly from the back. Neither was the Great Society or the Reagan Revolution. President Obama’s softly, softly approach is a rationalization, not a coherent strategy. It’s the latest version of Obama’s eternal promise: I’ll do it tomorrow.

So the mantle of leadership has passed to Capitol Hill. While Obama asked for patience yet again, Eric Cantor announced that Republicans will put entitlements on the table. It may be politically risky, but it looks more like leadership to me.

Latino Numbers Soar in Texas, Promising More Political Clout

From The Wall Street Journal:

Latinos accounted for 65% of Texas's population growth over the past decade, and for 95% of the increase among its rapidly expanding under-18 population, numbers likely to amplify the group's political clout for years to come in the second most-populous state.

Data released Thursday by the U.S. Census Bureau show that Texas, long associated with cowboys, cattle and the wide-open range, became more urban and more Latino from 2000-2010. Non-Hispanic whites ceased being the majority, shrinking to 45.3% of the population from 52.4%.

Overall, the minority population grew by 38% while the white population rose by 4%.

Thursday, February 17, 2011

Four States Get Waivers to Carry Out Health Law

From The New York Times:

The Obama administration said Wednesday that it had granted broad waivers to four states allowing health insurance companies to continue offering less generous benefits than they would otherwise be required to provide this year under the new federal health care law.

The states are Florida, New Jersey, Ohio and Tennessee, the administration told Congress.

Lawmakers said that many other states, insurers and employers needed similar exemptions from some of the law’s requirements and would seek waivers if they knew of the option.

To qualify for a waiver, a state, an employer or an insurer must show that compliance with the federal requirement would cause “a significant increase in premiums or a decrease in access to benefits

Deficit Plan Details Emerge - Bipartisan Senate Group Mulls Spending Caps That Could Trigger Tax Increases

From The Wall Street Journal:

A bipartisan group of senators is considering legislation that would trigger new taxes and budget cuts if Congress fails to meet a set of mandatory spending targets and other fiscal goals aimed at reducing federal deficits.

The plan would break the task of deficit reduction into four pieces: a tax code overhaul; discretionary spending cuts; changes to Medicare, Medicaid and other entitlements; and changes to Social Security, aides said. The Social Security system is on firmer financial footing than other major entitlement programs and raises political sensitivities that lawmakers want to deal with separately.

The proposal builds on the work of President Barack Obama's deficit commission, according to aides working on it.

The new budget the president sent to Congress on Monday envisions that spending on all the programs funded annually by Congress, including defense programs, will decline slightly over the next 10 years. Unless current trends are changed, spending on Social Security will rise 71%, spending on Medicare will rise 72% and spending on Medicaid will rise 115% over the same period, with the increases getting bigger after that.

A small group of House members, led by Reps. Frank Wolf (R., Va.), Jim Cooper (D., Tenn.), and Heath Shuler (D., N.C.), have been kept apprised of the effort. House Speaker John A. Boehner's staff has also been briefed, and Mr. Chambliss has kept an open channel to Mr. Boehner, a long-time personal friend.

"If the Senate effort gained momentum, John Boehner wouldn't be upset at all about getting thrown into this briar patch," said Ed Lorenzen, a staff member of the president's deficit commission, now with the Committee for a Responsible Federal Budget.

Sen. Charles E. Schumer (D., N.Y.) said Social Security should be removed from any deficit plan, according to an aide briefed on the meeting.

Republican aides said Wednesday that for the Senate effort to win GOP support in the House, President Obama would have to publicly embrace it.

But aides involved in the negotiations said it is not clear how firmly the administration will back the effort. Treasury Secretary Timothy Geithner is encouraging the talks, as is Bruce Reed, Vice President Joe Biden's chief of staff. But the White House has stayed away from any formal role.

Before details of the Senate plan emerged, New Jersey Gov. Chris Christie accused both the White House and Republicans in Congress of irresponsibility for failing to propose fixes for Social Security, Medicare and Medicaid.

"What game is being played here is irresponsible and it's dangerous," he told a packed house at the conservative American Enterprise Institute. "We are on the path to ruin."

Wednesday, February 16, 2011

Six senators—three Democrats and three Republicans—hope to finish converting the debt commission's recommendations into legislative language.

From The Wall Street Journal:

President Barack Obama defended his budget proposal Tuesday against criticism that it was too timid, as a bipartisan group of senators moved on their own to address the long-term spending issues the White House budget ducked.

Mr. Obama said he was confident the political parties would come together to find a bipartisan way to rein in the growth of Social Security and Medicare, and to overhaul the tax code.

But speaking at a news conference, he offered no details about what measures he could support, or about how talks between Republicans and Democrats might come about. He said he expected these matters to be addressed in the coming months.

The president called Medicare and Medicaid the biggest drivers of long-term deficit growth. And he said his bipartisan debt commission's plan "still provides a framework for discussion," even though his budget did not pick up most of its recommendations.

Meantime, the center of gravity for addressing long-term federal budget issues appeared to have moved to the Senate.

The effort is generating broad interest. Earlier this month, about 40 senators attended an 8:30 a.m. meeting on Capitol Hill to discuss comprehensive deficit-reduction legislation, building off the debt commission.

So far, White House officials have offered no assistance, Senate aides said Tuesday. "They're taking a step back and seeing how this shakes out," said one Democratic Senate aide.

Other senators leading the effort were Democrats Dick Durbin of Illinois and Kent Conrad of North Dakota, and Republicans Tom Coburn of Oklahoma, Mike Crapo of Idaho and Saxby Chambliss of Georgia.

Mr. Obama suggested that people pressing for answers on the big budget questions were impatient. "My goal is to actually solve the problem. It's not to get a good headline on the first day," he said. [Please! Spare us.]

Six senators—three Democrats and three Republicans—hope to finish converting the debt commission's recommendations into legislative language, according to Senate aides and a lawmaker involved with the process.

Sen. Mark Warner (D., Va.), one of the group's leaders, said in an interview a framework of the bill will be brought before a group of 25 senators after the Presidents Day recess to decide whether to bring it to the Senate floor for debate or break it into smaller pieces.

Tuesday, February 15, 2011

Rough news: Obama budget includes little for Savannah port

Story in the ajc. Just a flavor:

It was the president's plans for Port of Savannah funding that state officials were anticipating the most.

While disappointed, Deal and others pointed out that Obama's inclusion of $600,000 in funding was at least a sign the president supports the project.

“While we would’ve liked to see more, this shows the administration is still in support of the project,” said Republican Rep. Jack Kingston of Savannah.

Jim Galloway of the ajc's Political Insider asks "Did Port of Savannah just escape painful earmark status," and writes:

Now that Republicans have begun to digest the news about funding for the expansion of the Port of Savannah, a few are realizing that President Barack Obama may have just done Georgia a significant favor.

Not in the amount of funding allotted. No one can look at $600,000 and think it comes close to the $105 million needed.

But Obama just made the dredging of the Port of Savannah a line item in his budget. If that’s the case, it is no longer an earmark. And could free Georgia members of Congress from those no-earmark promises they made – if an agreement can be reached to address the dollar amount.

Remember that dinner-table joke featuring Winston Churchill and a stodgy dowager? Churchill asks her if she would sleep with him for five million pounds. Possibly, she responds.

How about five pounds? says Churchill. What kind of woman do you think I am? she declares.
Says Churchill: “Madam, we’ve already established that. Now we are haggling about the price.”

Georgia may now be now faced with the same situation – but in reverse. The Port of Savannah has just been established, in principle, as an Obama-sanctioned project. Now it may be a matter of haggling.

We were put on notice by the weak State of the Union address - Post Editorial: President Obama's budget kicks the hard choices further down the road

Today's editorial from The Washington Post:

THE PRESIDENT PUNTED. Having been given the chance, the cover and the push by the fiscal commission he created to take bold steps to raise revenue and curb entitlement spending, President Obama, in his fiscal 2012 budget proposal, chose instead to duck. To duck, and to mask some of the ducking with the sort of budgetary gimmicks he once derided. "The fiscal realities we face require hard choices," the president said in his budget message. "A decade of deficits, compounded by the effects of the recession and the steps we had to take to break it, as well as the chronic failure to confront difficult decisions, has put us on an unsustainable course." His budget would keep the country on that course.

Granted, the budget outlines cuts in discretionary spending, ranging from military procurement to heating assistance for the poor. A five-year freeze in nonsecurity discretionary spending - two years longer than the three-year freeze proposed in last year's budget - would save $400 billion during that period compared to what would have been spent otherwise to keep up with inflation.

But as Mr. Obama noted in his State of the Union address, discretionary spending represents a small slice of government outlays, so cuts in discretionary spending are simultaneously onerous and insufficient to reach fiscal balance. The administration proclaimed that its budget would save $1.1 trillion, two-thirds of it from spending cuts. It neglected to point out that, even if all those savings were implemented, the debt would increase by another $7.2 trillion over the decade. And that's accepting the administration's optimistic projections. From 2013 to 2016, the administration estimates the economy will grow at an average rate of nearly 3.9 percent per year, while the Congressional Budget Office projects a growth rate of just 3.4 percent. That could make an enormous difference in the amount of revenue generated and, consequently, the size of deficits. By 2021, the national debt will equal 77 percent of the total economy, even given the administration's rosy forecast - and, as the administration's chart reprinted here shows, the debt will then really explode.

Administration officials applauded themselves for having the discipline to offset the cost of two expensive items: avoiding punishing cuts in Medicare reimbursement rates for physicians and making sure the alternative minimum tax (AMT) does not hit a growing share of middle-class taxpayers. Not so fast. The patches are temporary - two years in the case of the so-called "doc fix," three years for the AMT. Meantime, the administration uses up a decade's worth of financing to pay for them - with no whisper of how to address the problems in the long term.

And that's not the only gimmickry. The budget assumes that the full cost of the doc fix will be paid for, and therefore not add to the deficit, but fails to explain how. It includes a $328 billion magic asterisk for transportation funding, identified only as "bipartisan financing for Transportation Trust Fund." Higher gasoline taxes? Don't ask. Meanwhile, the administration recommends paying for the AMT fix by reducing the value of charitable tax deductions for those in the two highest tax brackets. A smart idea, and one that the administration also proposed in its two previous budgets, originally as a way to pay for health-care reform. If it was a nonstarter then, what's the basis for thinking its prospects are better now?

The larger problem with the budget is the administration's refusal to confront the hard choices that Mr. Obama is so fond of saying must be faced. The president's debt commission concluded that more tax revenue will be needed in coming years to finance the costs of an aging society. Mr. Obama repeated his call to do away with the Bush tax cuts for upper-income taxpayers in two years - but maintained his tired and irrational insistence that the rest of the tax cuts, enacted in far different fiscal circumstances, be preserved.

If Oklahoma Republican Sen. Tom Coburn could sign on to a deficit-reduction plan that included raising tax revenue, is it too much to ask for such bravery from Mr. Obama? And if Illinois Democratic Sen. Richard Durbin could sign on to a plan that included raising the Social Security retirement age, is it too much to ask for more from Mr. Obama than an airy set of "principles for reform"? Sadly, the answer appears to be yes.

Monday, February 14, 2011

States Aim Ax at Health Cost of Retirement

From The New York Times:

Governors and mayors facing large deficits have set their sights on a relatively new target — the soaring expense of health benefits for millions of retired state and local workers.

As they contend with growing budget deficits and higher pension costs, some mayors are complaining that their outlays for retiree health benefits are rising by 20 percent a year — a result of the wave of retirements of baby boomers and longer life expectancies on top of the double-digit rate of health care inflation.

Over all, the Center for State and Local Government Excellence found that 68 percent of city and county officials surveyed said they were pushing to have retirees assume more of their health costs, while 39 percent said they had eliminated or planned to eliminate retiree health benefits for new hires.

Governors and mayors are also tackling the fast-rising health costs for the nation’s 19 million state and local workers, often focusing first on the government employees who pay nothing toward their health premiums for individual plans in 14 states. That is a benefit few private-sector workers have.

In Oregon, Gov. John Kitzhaber, a Democrat, is demanding that state employees start paying part of their premiums. Oregon is the only state in which state employees do not contribute to any of their premiums for either family or individual health plans.

In Jacksonville, Fla., Mayor John Peyton is insisting that police and firefighters begin paying 5 percent of the premiums toward their individual health plans, and the police union is balking.

“In this budget crisis, taxpayers are becoming more concerned about where their tax payments are going,” Mr. Peyton said. “And many see a huge disconnect between what private-sector workers are getting on benefits and what the public sector is getting.”

Sunday, February 13, 2011

Sen. Saxby Chambliss’ new role in the 2012 GOP race for president (as the ranking Republican member of the Senate Intelligence Committee)

Jim Galloway writes in the ajc's Political Insider:

The revolution in Egypt may have just revealed U.S. Sen. Saxby Chambliss’ new role in the coming GOP race for president.

On matters of foreign policy and national security, Chambliss could become the man who serves as a reality check for the likes of Newt Gingrich and Sarah Palin — reining in those who cast chunks of red meat over the line.

Last month, Chambliss was named the ranking Republican on the Senate Select Committee on Intelligence, responsible for oversight of the CIA and such. Should the GOP seize control of the Senate in ‘12, he could very well be the committee’s next chairman.

That makes Chambliss an official member of secret Washington, privy to the unspoken details behind every crisis of note. Much of his business will now be conducted over secure phones — which have just been installed in his office, the senator said last week during a visit to the state Capitol.

Chambliss isn’t known for speaking off the cuff. But now more than ever, what he says could have real impact on world events. And it will be assumed that he knows something we don’t.

Take, for instance, an Arab revolution that holds in its hands both Israel’s future and crucial U.S. access to the Suez Canal. During that chat at the state Capitol, Chambliss invited a few questions on Egypt.

Two Republican presidential presumptives had already weighed in. Palin, in a Christian Broadcasting Network interview, declared that “we should not stand” for a new Egyptian government that includes the Muslim Brotherhood.

Gingrich said that to encourage the inclusion of the Muslim Brotherhood in that country’s future political structure was “fundamentally wrong.” And he declared that the Obama administration’s handling of the Egyptian crisis was “the most amateurish foreign policy I have seen I think in my lifetime.”

Chambliss disagreed — with Gingrich, Palin and most of Fox News [with the exception of neoconservative Bill Kristol]. “I don’t know if we could say if the [Muslim Brotherhood] as a whole is made up of radical Islamicists. But that part of the world has a lot of extremists in it. And some of those extremists are members of the Muslim Brotherhood,” he said. “It is a concern, but it looks like they’re going to have to be part of the mix.”

As for Barack Obama, the Republican said he thought the president has handled the situation “pretty well.”

“It’s a very sensitive issue. You can’t get too far out. The last thing the United States needs to do is inject itself in telling the Egyptian people how to run their country,” Chambliss said. “We don’t even need to be perceived as doing that.”

Reminding voters (and candidates) of the limits of U.S. influence isn’t a happy task — especially at the outset of a presidential campaign. But it is a necessary one.

There are other downsides. While the position Chambliss has accepted offers the lure of being one of Washington’s true insiders, the post gives you very little to bring home to your constituents. Chambliss is giving up his ranking position on the Senate Agriculture Committee — which means he won’t be at the center of negotiations over the next farm bill.

“Most of this difficult work is done in a classified setting, which dictates that it cannot be shared with constituents or trumpeted for political gain,” said Senate Minority Leader Mitch McConnell, R-Ky., who offered the position to Chambliss.

But before Chambliss accepted it, he sought advice from former U.S. Sen. Sam Nunn — who indicated that Chambliss could be in for a rough ride from rank-and-file Republicans.

More than any other in the Senate, the Intelligence Committee requires the chairman — in this case Democrat Diane Feinstein of California — and the vice chairman to work closely together, Nunn said in a telephone interview.

“You’ve got to have someone who is willing to rise above partisanship,” he said.

“If handled correctly,” the former senator said, leadership of the Intelligence Committee can enhance one’s standing in the Senate tremendously. “And I think Saxby’s very capable of doing that,” Nunn said.

“But he’s not going to get back-home credit for it. And I think the people of Georgia ought to feel proud he’s being put in that position of trust,” Nunn said.

Chambliss is clearly pleased with his new status. While there have been whispers of primary opposition, Chambliss recently told a group of reporters that he was ready to run for re-election in 2014.

“Oh, yeah. I’m planning to run. My health is good. I’m beating this prostate cancer [diagnosed in 2004]. I’m cured. As long as I like what I’m doing, and my family’s still excited about coming to the White House now and then …” he trailed off.

Then there’s the new job. Decisions to be made about Guantanamo and the many fronts of the war on terror. “We truly are going to be at the point of the spear,” Chambliss said.

Saturday, February 12, 2011

Bring it on Brother Yarbrough, bring it on.

Dick Yarbrough writes:

State Rep. Rich Golick, R-Smyrna, is one of the more able members of the Georgia General Assembly, a serious young man not given to hyperbole. When he gets upset, it's noteworthy.

Golick went ballistic last week when the Mexican ambassador to the United States, Arturo Sarukhan, came to Atlanta specifically to criticize a couple of pieces of proposed legislation regarding the estimated 425,000 illegal immigrants in the state of Georgia. Golick is chairman of the House Judiciary (Non-Civil) Committee, in which one of the bills is being deliberated.

"The arrogance displayed by the Mexican government is absolutely breathtaking," he said. "The Mexican government has inappropriately injected itself into a debate where it has no role, and its suggestion that we are wrong to seek to enforce our laws is an insult to every law-abiding citizen of Georgia. We are a nation of laws, and we will not be influenced by the condescending comments of a foreign government. In fact, my sense is that the Mexican government's comments have only strengthened the resolve of those of us who believe in a culture of enforcement rather than a culture of excuses and entitlement."

Amen and amen.

The ambassador might be better served to get his own nation's laws enforced. A reported 35,000 people have been killed in Mexico's drug wars in the last four years, including 15,000 last year.

Wisconsin May Take an Ax to State Workers’ Benefits and Their Unions

From The New York Times:

Citing Wisconsin’s gaping budget shortfall for this year and even larger ones expected in the years ahead, Gov. Scott Walker proposed a sweeping plan on Friday to cut benefits for public employees in the state and to take away most of their unions’ ability to bargain.

The proposal by Mr. Walker, a Republican who was elected in November after pledging that he would get public workers’ compensation “into line” with everyone else’s, is expected to receive support next week in the State Legislature, where Republicans also won control of both chambers in the fall.

The prospect left union leaders, state and local employees and some Democrats stunned over the plan’s scope and what it might signal for public-sector unions in the state. Union leaders began planning rallies in Madison and contacting lawmakers, pressing them to reject the idea.

State leaders across the country have talked about solving budget woes with actions that in other climates might have been politically impossible: cutting the salaries and pensions of government workers and limiting the power of labor unions.

But the plan in Wisconsin, which faces a $137 million shortfall in the current budget and a gap in the billions for the coming cycle, is among the most far-reaching of such proposals to be delivered to lawmakers. Mr. Walker expects swift approval.

Among key provisions of Mr. Walker’s plan: limiting collective bargaining for most state and local government employees to the issue of wages (instead of an array of issues, like health coverage or vacations); requiring government workers to contribute 5.8 percent of their pay to their pensions, much more than now; and requiring state employees to pay at least 12.6 percent of health care premiums (most pay about 6 percent now).

This story about Egyptian President Mubarak illustrates the greatness of The Times.

Egyptian President Hosni Mubarak made a televised statement on Thursday night.

From The New York Times:

Hosni Mubarak’s legacy was supposed to be stability. During almost three decades in power, he rejected bold action in favor of caution. He took half-steps at economic liberalization, preserved the peace with Israel, gave his police force the power to arrest without charge and allowed only the veneer of democracy to take hold

But history upended Mr. Mubarak, and his fall came as suddenly and surprisingly as his unlikely elevation to the presidency 30 years ago. Mr. Mubarak’s Egypt rose up against him. The streets and squares filled with hundreds of thousands of protesters day and night until he could no longer deny the inescapable conclusion that in order to restore stability, he needed to go.

It was an unexpected epitaph for a military man who until recently was revered — and reviled — as Egypt’s modern-day pharaoh, serving longer than any contemporary Egyptian leader since Muhammad Ali, the founder of the modern state. “He’s the accident of history who brilliantly survived as the longest accidental ruler of Egypt,” said Emad Shahin, an Egyptian scholar at the University of Notre Dame who, like many other Egyptians living abroad, rushed to Tahrir Square in recent days to share in the moment.

In his final appearance on state television on Thursday, when he astounded most of his listeners by appearing to say he would remain in office, he was no longer the stocky, confident military man who was the only leader most Egyptians had ever really known. At 82, he was frail and thin, with dyed black hair and a sometimes poignant undercurrent of self-justification.

The Egyptian public, Egyptian political and military leaders, and American officials all expected him to say he was handing over power. But he apparently could not bring himself to say so, clinging to his vision of himself as a reluctant leader tapped by fate to lead a nation that could not survive without his guiding hand.

With his authority already belittled by the crowds in the streets, with the people no longer silenced by the fear his security apparatus had enforced, his words served only to demonstrate how out of touch he had become.

“I have given my life serving Egypt and the people,” he said, suggesting it was he who was tired of them, and not the other way around.

He failed this time using tactics that had so long sustained his rule: the ability to divide and conquer the masses, to anesthetize the population with promises, pay raises, subsidies and government reshuffling. He spoke of preserving his dignity, but that is exactly what the crowds in the street were fighting for, but for themselves.

During his tenure, Egypt’s population doubled, to more than 80 million. Life grew harder as the social contract between the state and citizens broke down. Satellite television and the Internet meant the state could no longer control what people knew, and so its narrative was often ignored or even mocked.

The gap between rich and poor became greater, and politics became less ideological and more about common demands: for freedom, democracy, social justice, rule of law and economic equality. Mr. Mubarak’s government struggled to prevent people’s economic dissatisfaction from becoming political, but in the end, that failed, too. As he feared, the Egyptian people blamed the entire system.

But perhaps most of all, Mr. Mubarak’s concept of stability — one that was embraced by Washington — in the end proved the ultimate destabilizer, experts in Egypt said. Facing a police state that choked off competing ideas and ideologies, preventing free elections and manipulating the state media, the public found the only way to achieve its goals was on the streets, occupying the symbolic heart of the nation, Tahrir Square, and refusing to go home.

Mr. Mubarak leaves office now with the country’s future more uncertain than at any time since assassins killed President Anwar el-Sadat, elevating Mr. Mubarak to the presidency.

“The idea of integration did not exist in Egypt under Mubarak,” said Amr El-Shobaki, a political analyst at the state-financed Ahram Center for Political and Strategic Studies, in an interview before the crisis. “When they see the opposition, they only think, ‘How do we eliminate them?’ We have a lot of issues in society, political and social, and we don’t have any legal body to express these demands or needs. This is our crisis.”

The people found a way, organized by social media and old-fashioned political mobilization, united by anger and hope.

If stability was to be the hallmark of his reign, that very goal proved to be at least part of his undoing. Stability to many Egyptians came to mean stagnation, as the economy grew and so did the number of people living in poverty. Where once the rich, poor and middle class lived in the same neighborhoods, the wealthy later retreated to walled compounds of grass yards and swimming pools, while Mr. Mubarak’s government struggled even to keep the streets clean of trash.

Nearly every step he took in his quest to preserve the status quo ended up diminishing the standing of the nation as a whole — a blow to a nation that once saw itself as the center of civilization and the Arab world, many political analysts and social commentators said.

Egyptians were shocked when their country did not receive even one vote to host the World Cup soccer tournament in 2000, and then were shocked again this year when Qatar, the tiny oil-and-gas-rich Persian Gulf nation, succeeded in winning the right to host the event in 2022.

“He used the security forces, every political device, and ‘crony capitalism’ to realize his ends, sacrificing the dynamism, autonomy and capabilities of Egyptians, particularly young people,” said Diane Singerman, a professor at American University and an expert on contemporary Egypt.

Mr. Mubarak was initially seen as the perfect antidote to what ailed his nation. He came to power in 1981, when Mr. Sadat was assassinated by Islamic radicals in the military. Mr. Mubarak, sitting next to him, was seared by the experience and pledged to assure security.

He came to power when Egypt was hugely in debt and unsure whether it could pay its bills. It was still ostracized by its Arab neighbors for making peace with Israel.

Mr. Mubarak’s role was to bring calm, stability and unity to his nation, and at first, he did. He was a taciturn military officer, offering a welcome contrast to his two predecessors, charismatic leaders who marked their place in history for bold if not always successful ideas. President Gamal Abdel Nasser promoted pan-Arabism, and Mr. Sadat made peace with Israel, a peace many Egyptians never fully accepted.

“This guy came to power and he kept the country together,” Abdel Moneim Said, the chairman of Al Ahram Newspaper and Publishing, said in an interview before the uprising. Mr. Mubarak also presented himself as a humble leader, tapped by fate to lead his nation. He was a former athlete, a squash player, a former military man and commander of the air force who, analysts and peers said, believed that long hours and hard work equaled good leadership.

He publicly rejected nepotism, though in later years he would maneuver to have his son succeed him. He publicly shunned corruption, although Egyptians became convinced that the powerful enriched themselves at the public’s expense.

His early successes were substantial, especially in the realm of foreign policy. He helped to bring Egypt back into the Arab fold, but also managed to serve as a strong voice for peace between Arab nations and Israel. In the mid-1990s, he was instrumental in helping to forge the agreements with Israel and the P.L.O. that were intended to foster a Palestinian state in the West Bank and Gaza.

Mr. Mubarak oversaw substantial improvements in Egypt’s infrastructure and helped, initially, to reschedule debt and stabilize the economy. He was also a friend of Washington, which gave annual military and economic aid of as much as $2 billion. In 1991, he helped to organize the coalition of Arab armies that agreed to join the United States in the first Persian Gulf war to push Saddam Hussein out of Kuwait.

Even during the years when Mr. Mubarak was unhappy with President George W. Bush for talking about human rights and democracy in Egypt, he was seen as an ally willing to help with many issues, including the effort to thwart Iran’s growing regional influence and to try to contain the militant group Hamas, which had seized control of the Gaza Strip. Egypt was a partner in carrying out the widely criticized policy of rendition, in which terrorism suspects were flown to third countries for harsh interrogation, even torture.

“He kept close to the United States, but independent of it,” said Mr. Said, who was a member of Mr. Mubarak’s ruling National Democratic Party. On the day before the Jan. 25 protest that ultimately pushed Mr. Mubarak out of office, Mr. Said said he thought such an outcome was out of the question.

But Mr. Mubarak’s approach never seemed to change with the times, experts said, and he ultimately became viewed as an isolated autocrat, who allowed, or promoted, corruption and cronyism. He preserved an emergency law that allowed the police to arrest without cause, restricted the right to assembly, and set up a military court.

The public anger grew, visible to many — but not to the president or his circle.

“The government does what it wants and they think nobody can do anything about it,” said Fahmy Howeidy, a social commentator, speaking before the uprising began. “But there is a difference between people swallowing this and the anger accumulating in the people. Civil society institutions are in a state of collapse and are extremely weakened. But the people are there and they are angry.”

Mr. Mubarak’s political organization, the ruling National Democratic Party, was less a party than a collection of interests. It grew to be widely despised, and during the recent tumult in the street the protesters set its headquarters on fire.

“If he left in 1993, he would have been a great president for sure,” said Mr. Shobaki of the Ahram Center. “If he left in the ’90s, it’s average. And starting in 2000, we start the real decline.”

Mr. Mubarak appointed a cabinet to put in place economic improvements, and made some cosmetic political changes. The first three times he ran for re-election, he ran unopposed, in what were called referendums. The fourth time, he allowed opposition
candidates, but won with millions of votes and suspicions of electoral manipulation. The nearest challenger, Ayman Nour, got about 600,000 votes, and was later jailed on what were widely seen as politically motivated charges.

During his three decades in power, Mr. Mubarak, his allies and his party never managed to define an idea for Egyptians to believe in. “The excesses of free markets without freedoms, the increased economic inequality in Egypt and crass inattention and suspicion of the needs and aspirations of the majority of Egyptians, finally rose up to pierce the monarchical, securitized state that he and his supporters had built,” said Mrs. Singerman, the American University professor.

During his tenure, Egyptians never lost their well-known sense of humor and their zest for satire. And it was not long after he took office that his hallmark, stability, was already mocked not as a legacy, but as a punch line.

The joke from the late 1980s went like this: Mr. Mubarak’s driver came to a fork in the road. He asked his driver which way President Nasser went and the response was, “Always left.” He asked about
President Sadat and the answer was, “Always right.”

“Signal left, then right, and park,” Mr. Mubarak told his driver.