'''No bill' is better than a 'bad bill'''
on Friday, December 28 @ 08:30:37 EST


By A.F. Nariman
YellowTimes.ORG Columnist (United States)

(YellowTimes.ORG) – On Thursday, December 20, 2001, the House Republicans, in their second attempt at a Stimulus package, passed a revised bill largely along party lines on a 224-193 vote in the wee hours of the morning.

The debate started at 10 p.m. and ended at approximately 5 a.m. Never before has the same bill been passed twice by the same Congress in the same session. The House Republicans were shamed into passing a new Stimulus Bill as their previous tax giveaway was derided by one and all – conservatives and liberal commentators alike – from the Wall Street Journal to the New York Times.

House Ways and Means Chair Bill Thomas (R- CA) realized he had to get the monkey off his back. His outlandish first Stimulus Bill had caused the rift that had stalled the progress on the Stimulus Package. So the Republicans under the goading of President Bush put together a more centrist package, except they undercut a true deal by their handling of the extension of unemployment benefits and in particular of the health care benefits.

The Republicans wanted the 13-week extension of unemployment benefits to be given as a block grant to states (block grants give federal dollars to the states without specific directives that they must be used for a certain program). Thereby giving state governors, whose economies are already hurting, the discretion as to whether or not to use any or all of the federal dollars to pay the unemployment benefits for an additional 13-weeks.

But the deal breaker was the extension of health care benefits to the unemployed. The Democrats wanted to extend the medical benefits of the unemployed for an additional 13-weeks through the current system where the employers pay 75% of the cost of the COBRA insurance and the unemployed worker pays 25%. The Congress would pick up the tab, but the delivery system would stay the same. Instead, the Republicans decided in a cynical move to give the unemployed these benefits as a tax credit. This was a manner for the Republicans to look like they were being compassionate, while undercutting the unemployed.

There were some Republicans who truly believed that they were being more compassionate. Republican Nancy Johnson (R- CT) stated that the Democrats would only give health benefits to those currently covered under the COBRA system – those who were full-time employees, but that the Republican plan encompassed all unemployed – including part time workers.

However, Rep. Dingle bitingly repudiated the Republican measure on the House floor. He explained it would be difficult if not near impossible for an unemployed person to owe taxes, so the question of getting a tax credit for the unemployed would be a moot one. If the unemployed could not avail themselves of the tax credit, then in essence they would get no assistance in the Stimulus package for health coverage. Were the Republicans being wicked or just plain doggone dumb? I’ll let readers decide for themselves.

On Friday, December 21, the Congress departed for the Christmas Holidays. The parting thoughts were not of good cheer, but rather of finger pointing. The blame game inside the beltway had begun!

The Republicans clearly had Senator Tom Daschle in their crosshairs. Republican Congressmen and Conservative talk show hosts alike were suggesting this was a cynical move by the Democrats lead by Daschle to bolster his party’s opportunities in the 2002 Congressional elections, and his own bid for the presidency in 2004, by handing Bush a poor economy. Daschle was touted as a veritable George Mitchell. During the first Bush administration, Majority Leader Mitchell was also blamed by Republicans for having caused the George Herbert Walker Bush presidential ship to sink by forcing the elder Bush to renege on his loose lips campaign promise of “No new taxes.”

Conservative commentators and Republican Congressman alike blamed Daschle for blocking the New House Bill from coming up for a vote in the Senate. He was derided for showing partisanship by using a procedural maneuver requiring 60 votes for the Bill to come to the senate floor. That this derision was by the very same Republicans who used their own identical procedural maneuver to block a vote on the Senate floor of the Democrat’s bill that had passed the Senate bill on an 11-10 vote, should give us cause to pause and ponder. To wit, “It was Déjà vu all over again!”

Let me bring some Holiday cheer to the discourse. The cynical conservative pontificators are wrong. Dead wrong! Not that I am suggesting that Daschle is not eyeing a White House bid in 2004, nor a takeover of the House by Democrats in 2002. Rather, that the Democrats dissent was a principled one. As explained in my earlier article, “A Republican Trojan Horse Stimulus Package -- foiled by ‘Troy’ Daschle,” the Democrats have tenuously held to their newfound religion!

Since the 1993 Economic Recovery Package and the ensuing eight years of deficit reduction, the Democrats have had a love affair with “fiscal discipline.” They understand that long term economic growth and the ability to maintain the Social Security and Medicare programs is tied to having a fiscally sound budget. The Clinton budget after a decade of moving assiduously towards the black ink has reverted to the Bush budget swimming in a sea of red ink.

There are two ways to bust a budget – excess spending which Democrats have been blamed of in the past, and reduced revenues by big tax giveaways. Those who still tout that supply-side economics worked in the 1980’s need only to look at the facts -- a tripling of the national debt and deficits as far as the eye could see.

Only the Senate Democrats Stimulus package assiduously sticks to the principles agreed to by the White house and Senate and House Budget Committees when true bi-partisanship reigned supreme in the immediate aftermath of 9/11.

Their package is short term, paid for, and has no long-term negative effect on fiscal discipline. The Republicans House and Senate tax giveaways are a budget buster both short term and long term. The Democratic package at $75 billion comes closest to President Bush’s request of a $60 billion Stimulus Bill ($100 billion minus the $40 billion already allocated to New York, the Airlines bailout, and the “War on Terrorism”).

The Republican package at $110 billion in the first year balloons to over $200 billion in costs to the federal budget by 2005. This would get us further and further into debt with the baby boomers retirement around the corner and all the trust fund money being sucked up for these giveaways.

However, as explained above, the final deal breaker was over the extension of the medical benefits to the unemployed as a “tax credit.” The Democrats saw the new version of the Republican bill as a cynical attempt by the Republicans to put on a Santa Claus suit, while passing out lumps of coal.

The Democrats are not so diabolic as to hurt the unemployed workers in order to realize their political ambitions. They saw a Stimulus Bill that would not necessarily help the laid-off workers in the near term and hurt the fiscal discipline, in turn, damaging the country’s economic growth in the long term. They rightly decided that “no bill” was better than a “bad bill.”

A.F. Nariman encourages your comments:  anariman@YellowTimes.ORG

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