Neil deMause

The June issue of Extra! is out, and with it my article on how coverage of state budget battles back in the spring swept under the rug the question of how much of the budget crises were caused by past tax cuts for the rich:

When protests against attempts to roll back state workers’ benefits swept across the nation in February and March, local and national media coverage largely portrayed it as the inevitable collision of generous worker benefits and tight economic times.

The Columbus Dispatch (2/20/11), for example, reported that “the protests at the Ohio and Wisconsin capitols portend what lies ahead as governors in both parties move to cut worker benefits or jobs to balance their books.” The Dispatch called employee pension and healthcare benefits “a long-term threat to state budgets,” citing economists with both the right-wing Heritage Foundation and the right-wing American Enterprise Institute as saying that worker pensions are “squeezing” state budgets…

This story is subscribers-only for now, so you’ll need to sign up (only $15 for a year’s digital subscription!) if you want to read it. Or wait a couple of months until it shows up for free on FAIR’s website, but where’s the fun in that?

If you’ve been wondering where my non-baseball writing has gone to recently, I have a bunch of stuff in the pipeline that’s going to start showing up in print (and in pixels) in coming weeks. And the first of these is now out, a profile of Brooklyn developer Bruce Ratner for the Jewish Daily Forward, on the occasion of his firm’s reported ties to a state senator accused of bribe-taking:

When federal prosecutors charged New York State Senator Carl Kruger with taking more than $1 million in bribes in March, few were surprised to see seven others indicted with him. The colorful Kruger, who represents the heavily Jewish Brooklyn neighborhoods of Brighton Beach, Gravesend and Sheepshead Bay, has long attracted media attention for high-profile deal-making among a wide network of politicians and lobbyists… [read more]

A multi-year campaign to require that all employees in New York City receive paid sick time (which I first wrote about last fall) was quashed in October by city council speaker Christine Quinn. What happened, and what does it mean for worker rights and the city economy?

Last winter, it seemed all but inevitable that New York City would become the latest city to pass a law mandating that all city businesses provide paid sick leave to their employees.

A coalition of worker-rights groups, including Make the Road New York, the Working Families Party and the legal advocates A Better Balance had lined up to push for the legislation; a veto-proof majority of 37 city councilmembers had not just endorsed but co-sponsored a bill that would require at least five days of annual leave for all workers. And with the nation in the grip of swine-flu panic, visions of restaurant cooks showing up sick for work had even some small business owners admitting that some kind of sick-leave law was probably inevitable… [read more]

As part of City Limits’ series on what New York is getting itself in for with its next governor, I look at Carl Paladino and Andrew Cuomo’s job-development plans (but mostly Cuomo’s, because Paladino had to leave the story early to go to the bathroom):

If the seven-member comedy act that was the October 18 gubernatorial debate can be said to have had a serious message, it was likely this: It’s the jobs, stupid. Amid the prostitution jokes, one of the most pressing questions of the night was how New York’s next governor plans to address an economic future that looks, by anyone’s reckoning, bleak.

Neither Andrew Cuomo nor Carl Paladino returned multiple requests for comment, but both have issued statements or proposals that provide insight into their plans… [read more]

I’m not sure exactly why NPR.org is running content from National Review Online, but if they’re all as unintentionally funny as this one, I’m all in favor of it.

In today’s story, Michael Tanner of the arch-libertarian Cato Institute (one of the Koch brothers family of thinktanks) sets out to explain why the Obama administration is at fault for keeping Americans in poverty. Argument #1:

For example, few things are as important in helping people escape poverty as education. High school dropouts are more than twice as likely to end up in poverty as those who complete at least a high school education. They are less likely to find jobs, and if they do their wages will be low. In inflation-adjusted terms, wages for high school dropouts have declined by more than 23 percent in the past 40 years.

An excellent point, and one I’ve made myself in the past. So is Tanner going to argue in favor of allowing people to go to college while receiving welfare benefits, thus allowing them to pull themselves up by their libertarian-friendly bootstraps?

Not exactly:

Yet Obama and the Democrats, in thrall to the teachers’ unions, steadfastly resist proposals to give parents more control over their children’s education. Washington, D.C., has a public-school system that, despite spending more per child than almost any other system in the nation, still has a dropout rate of more than 50 percent. Yet one of the first actions of the president and congressional Democrats was to kill the Opportunity Scholarship Program, which offered vouchers to permit poor children to opt out of the city’s rotten public schools.

That’s right: The reason poor people are poor is because they don’t have enough charter schools. And never mind that charter schools aren’t any better on average than traditional public schools (or, for that matter, that D.C.’s school system is run by one of the nation’s loudest charter advocates, soon-to-be-replaced “Waiting for ‘Superman’” star Michelle Rhee).

On to argument #2:

And, of course, nothing is more important in fighting poverty than jobs. Yet the Obama administration is overtly hostile to the entrepreneurs and job creators in our economy. The wealthy are demonized rhetorically. Every other day seems to bring a new proposal to raise their taxes. Just look at the barrage of political commercials and presidential speeches that sneeringly denounce the Bush “tax cuts for the rich.” But, as former Texas senator Phil Gramm once noted, “No one ever got a job from a poor man.”

Phil Gramm has a Ph.D. in economics, which just makes that quip all the sadder: Anyone who runs or works for a business that sells products to the masses — which is to say, most people who are not economics professors — has “gotten a job from a poor man” in the very real sense that without the spending of the non-capital-owning classes, their company would be out of business. (You may have personal experience with this of late.) And it’s more than a rhetorical point: Economists consistently score tax cuts for corporations and the wealthy as lousy economic stimulus measures in terms of how much bang you get for your federal buck. (This is known around my household as the “you can only buy so many yachts” principle.) The best alternative? Giving money to those damn poor people, who you can at least count on going out and spending it.

There’s more, but it involves privatizing Social Security as a way for poor people to reap the riches to be made by playing the stock market, and I’m laughing too hard already. So kudos to NPR for its new humor column; I just hope no overly gullible readers take it seriously.

For anyone wondering whether Obama’s reported plan to give lots of investment tax breaks to businesses is really that bright an idea, Robert Reich today gives a resounding “no way, no how“:

The economy needs two whopping corporate tax cuts right now as much as someone with a serious heart condition needs Botox.

The reason businesses aren’t investing in new plant and equipment has nothing to do with the cost of capital. It’s because they don’t need the additional capacity. There isn’t enough demand for their goods and services to justify it. Consumers aren’t buying because they’re trying to come out from under a huge debt load, including mortgage debt; they have to start saving because their nest eggs are worth substantially less; and they’ve lost or are worried about losing jobs and pay.

For those who’ve followed the world of corporate subsidies, this should be a familiar refrain: It’s the but-for question, stupid! When considering whether to subsidize economic development of any kind, the first question needs to be: Would the development happen anyway without the subsidy? Obama’s investment tax credit fails this first test, says Reich: Businesses will take the credit for investments they’d make anyway, but nobody’s going to build a factory to build crap they can’t sell just because they can get a tax credit for it.

So what we’re likely to see if this passes is the government handing out lots of money for spending that would have happened anyway, but not much else. At best, it might get some companies to shift some spending from early 2012 to late 2011 to take advantage of the tax credit, much like everyone rushed to buy houses back in April to get in under the gun for the homebuyers tax credit. And we see how well that worked out.

It always feels icky to hand out tax breaks to big businesses when tons of regular folks are losing their jobs and their homes. In this case, it’s not just ick-worthy, but lousy economics, too.

Stephen Goldsmith, the former Indianapolis mayor who started work June 1 as Mayor Bloomberg’s new deputy mayor for operations, has been hailed as a visionary. Just not by the people who actually experienced his Indianapolis reforms.

When Mayor Bloomberg tapped former Indianapolis mayor Stephen Goldsmith in April to replace longtime aide Ed Skyler as the city’s new deputy mayor for operations, all the talk was about the new hire’s credentials as an innovator at remaking government through privatization. The Times called Goldsmith, a former two-term mayor of Indianapolis who officially started work at City Hall on June 1, “a national leader in the movement to introduce corporate-style accountability and cost-cutting into government bureaucracy.” Bloomberg enthused about his new hire, “Lots of people talk about reinventing government; I think it’s fair to say Steve has actually done that.”

According to some of those who saw Goldsmith’s work firsthand in Indianapolis, however, his record is mixed. The Indianapolis miracle, say many community and labor leaders, was less an indicator of the magic of privatization than of its limits. … [read more]

New York’s new public advocate, former city councilmember (and Hillary Clinton campaign director) Bill de Blasio, has been mostly talk since his election last fall — but for city’s “ombudsman,” speaking loudly might be the most effective tool of all. (And no, I’m not exactly sure what the headline means, though I hope it involves Mike Bloomberg as Simon Bar Sinister.)

When the New York Times delivered its all-important endorsement to then-City Councilman Bill de Blasio in last year’s race for public advocate, the paper noted that the winner’s chief task would be “demonstrating whether this position truly serves New Yorkers.”

If the subtext wasn’t clear then, it was brought into sharp focus when the mayor’s charter revision commission announced that its agenda for this year would include the possible elimination of the public advocate position… [read more]

When Mayor Bloomberg threatened to cut all kinds of services back in January, turns out he wasn’t kidding:

The big headline from Mayor Bloomberg’s announcement yesterday of his final city budget plan was that 6,414 city school jobs would be eliminated in response to an anticipated $493 million in reduced state education funding to New York City. But buried in the 4,024-page budget itself are dozens more cuts that would affect scores of city services, from libraries to summer youth jobs… [read more]

Mayoral press release subject line opening of the day:

MAYOR BLOOMBERG, SIGOURNEY WEAVER AND OTHER OFFICIALS…