Saturday, April 16, 2011

How laws are passed

Late in my elementary school career, I remember, we had what amounted to a civics textbook. It included a complicated diagram describing how the U.S. Congress passed laws. First they were introduced in one chamber, let us say the House of Representatives. They were referred to a committee for hearings, and the committee called witnesses, questioned them, and wrote a report. The bill went to the floor for passage (I don't think the textbook mentioned the then-crucial role of the House Rules Committee), and if it passed, it went over to the Senate. Hearings took place there, too, and after another report, the bill reached the floor for debate, possible amendment, and passage. If the two versions now differed, the leaders of the two chambers appointed a conference committee to work the differences out--and if all went well, the bill then passed.

That system operated during the greatest era of American legislative history, from 1933 to sometime in the 1970s. I saw it in action in the summer of 1963 when I worked on Capitol Hill myself. That was a momentous year in American history, and I (and many other Senators) spent many hours in two hearings in particular. While the Senate Commerce Committee considered the public accomodations portion of the Civil Rights Bill, I saw testimony from George Wallace, from the commissioners of the major American sports leagues, from Mayor Ivan Allen of Atlanta (who, in an act of supreme political courage, supported the bill), and from an unreconstructed bigot invited to testify by Strom Thurmond who quoted data on the brain weights of various races. (Even Strom realized he had gone to far that time.) Later I heard testimony on the Test Ban Treaty, including opposition from the father of the H-Bomb, Edward Teller.

Times have changed.

Less than two weeks ago, Representative Paul Ryan, the new Republican star, introduced his plan to cut, in theory, $4 trillion from the federal budget over the next decade. (That is not, by the way, nearly as much as it sounds--$400 billion a year just happens to equal the permanent deficit that George W. Bush created with a combination of tax cuts and wars.) His plan, as everyone knows by now, would turn Medicaid into a block grant to the states and make Medicare a subsidy allowing seniors to buy private insurance plans. That last provision is so outrageously bad for America that it is hard to believe it was ever adopted. Medicare's administrative costs are notoriously much lower than those of private insurance. Nor does Medicare pay its executives multi-million dollar salaries or its shareholders handsome dividends. There is no way that private insurance is going to deliver care more cheaply than Medicare does. Ryan, of course, claimed that "competition" would lower costs, but he didn't mention that the health care industry is already exempt, disgracefully, from the antitrust laws. Ryan claims to be a devotee of the free market--perhaps he should try reading Adam Smith. "People of the same trade seldom meet together, even for merriment and diversion," Smith wrote more than two hundred years ago, "but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices." The Ryan budget would not just extend the Bush tax cuts: it would cut the top marginal rate further, down to 25%.

Yesterday, just ten days after Ryan unveiled the plan, the Republican House passed it unamended. There were no hearings, no expert testimony, and virtually no debate over an attempt to undo about 80 years of American public policy. The Tea Party Republicans are acting with the fervor of the French Jacobins in the Convention (1792-94). The Republicans in Congress now consist of those who belong to the Tea Party and those terrified of primary defeat by some one who does. They have no time for discussion, for evidence, or for rational thought. They have rammed the legislation through.

Of course, it is not going to pass--although the possibility of the Republicans securing full control of the government in less than two years cannot be ruled out. But they don't care about that either. Their vote was a sound bite, a video clip, nothing more. And that is what has happened to our political system. President Obama has at last found the courage to stand up for the America he grew up in; but his speech was in its own way a sound bite as well. If anyone wanted realistically to rewrite the diagram I read in elementary school about how legislation is made, they would do it with sound bites, clips from press conferences, brief debates, and signing ceremonies. Meanwhile, the actual details of legislation are written largely by lobbyists, or in think tanks. The Republicans at the Heritage Foundation and the American Enterprise Institute live in an echo chamber dominated by libertarian ideologies, and certainly can't be bothered to do a reality check on their free-market fantasies.

Now let me see if I can my own small bit to re-introduce facts into the discussion. The Ryan Plan is forcing everyone to look seriously at budget numbers, and on NPR the other day I heard Howard Dean boldly make the rather obvious statement that we would have to go back to the Clinton era tax rates not just for the wealthy, but for everyone. President Obama may indeed have to go that far in the end, as he most certainly should have last fall, because the Republican House will never pass a bill simply restoring the higher rates for the wealthy, and he will be forced to let all the Bush-era tax cuts expire. Here is a table showing the evolution of top marginal tax rates over the last 100 years.

[I wanted to put the table in the blog but I am running into a common malfunction with the blog editor and it is not adding images. If anyone knows the fix, please let me know.

The table illustrates the paradox of twentieth century history: the two world wars, catastrophic for western civilization, also gave the national government the resources to do a great deal of good. It also shows that it is possible without drastic consequences to raise the top rates in the midst of a depression even worse than this one. And look at the table, as well as the graph, to see the levels--equivalent to several million dollars at today's prices--at which income was capped during the 1950s. There were, of course, loopholes. Those who possessed a large fortune could invest it in municipal bonds tax free. But those rates corresponded with robust economic growth.

I return to the theme of last week's post. Emotion, not rationality, dominates our politics today. One of our parties has become entirely faith-based, abandoning any pretense of gathering evidence to support its propositions. The other is too beholden to corporate interests actually to put forward an alternative to social Darwinism as a world view. The Enlightenment dream, that knowledge alone would improve the world, has turned out to be false. Knowledge is not enough. But it can help.

7 comments:

Anonymous said...

Excellent article as usual. The term 'faith-based' is an interesting choice as your idealistic description of government being able to do 'good' sounds as much or more faith-based as those you deride as such. One could look at the result of this 'good' work as bombed out formerly prosperous inner-cities, ludicrous corrupt wars in the deserts of the middle-east, and bailouts of incompetent financial gamblers.

Gerald Meaders said...

Professor

Wonderful synoptic essay, on current events, legislation, with historical references and associations, and other things.

Thanks for publishing this.

Thanks especially for the capsule on medical insurance afoot.

Capitalism, and free trade, have been the siren songs of weak,overly 'liberal' systems,

some now, unfortunately, on the verge of collapse.

Would 'competition'(whatever that means here besides robbery) 'lower costs', with rampant monopolies, many of them 'converging' into 'natural' monopolies based on technological developments?

I doubt it.

All the best,
GM

Anonymous said...

Have you seen this paper by Ferguson?

http://ineteconomics.org/sites/inet.civicactions.net/files/BWpaper_Ferguson_040811.pdf

David Kaiser said...

Let's get our Fergusons straight! I was afraid the article was by Niall. Fortunately, I looked. You are right. It's a wonderful piece.

Gerald Meaders said...

Professor

I was also relieved that it wasn't 'Niall'...

but could not get to the article based on Anonymous' II's webpage reference, unfortunately.....

Maybe someone can amend it.

Many thanks,
GM

Anonymous said...

It would be rather useful if you would at least check and verify
the facts about people you write about! The AHIP's President name is
Karen Ignani.

I mean, at least you should be able
to get the name right!! It is NOT
that difficult!

David Kaiser said...

The anonymous gentleman who posted the comment above is, presumably, the same person who posts about 10 anonymous and abusive comments a week, all based on "conservative" talking points. As I warned months ago, such comments are routinely deleted. He is engaging in form of right-wing guerrilla warfare which is very popular on blogs and forums.

In this case I posted his contribution because he is wrong. Her name is Ignagni, not Ignani. Perhaps he wanted to see if I was dumb enough to change it just because he claimed I had made a mistake. I wasn't.