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Republicans Change Rules; Democrats Change Stripes

This week President Obama will make another ‘State of the Union’ (SOTU) annual address to Congress.  In his SOTU addresses in recent years his comments were typically cautious, careful not to convey or promise too much in terms of new initiatives that would benefit those left behind in the so-called US economic recovery. Proposals for programs to help raise wages for American workers, help immigrants become citizens, save homeowners from foreclosures, ensure affordable education for students, shore up the USA’s collapsing pension system, and so on were considered too controversial.

As noted repeatedly by his White House spokespersons, anything more than minimalist proposals would only give an excuse for Republicans and conservatives in the US Congress to intensify their opposition; or would put Democrat Party members of Congress coming up for elections in conservative districts in a difficult position.

Since Republicans never agreed on anything whatsoever Obama proposed during his prior six years in office, it’s hard to see how Republican opposition could intensify further if Obama had proposed more aggressive action during those years.  And concern about saving a few Democrat politicians’ careers appears to have been a waste of political capital in any event, since they were all swept out of office last November 2014 anyway.

A short list of the token, minimalist initiatives that did flow from Obama’s prior 2010-2014 SOTU addresses included proposals for

*adjusting mortgage rates by a mere quarter percent or so and temporarily suspending some principal payments for homeowners ‘under water’ in their mortgages as a solution to the 14 million who were being foreclosed and losing their homes;

*immigration reform for 11 million that meant no amnesty, continued deportations, and citizenship maybe for a few, years down the road, after big financial penalties and payments;

*a token tweaking of interest rates on student college loans, with rates still charged by the federal government well above market averages, and continued payments of tens of billions of dollars a year from students to the federal government;

*a lot of ‘talk’ about inequality and raising wages but no ‘walk’;

*a return to a 1950s-like voluntary savings plan as a retirement crisis solution;

So Obama ‘low-balled’ it for six years, as they say. And he got what he asked for. Ask for nothing, and that’s just what you’ll get—nothing. That phrase might very well sum up Obama’s presidential legacy when it’s all over two years from now.

But not this year, not in his forthcoming 2015 SOTU address this week. No low-balling this time. This time will be different. This time we’ll hear echoes of what we haven’t heard, and what many naively expected to hear from him back in 2008.

Reports leaking in recent days about his forthcoming 2015 address suggest this week he’ll offer proposals that he should have raised six years ago. Now we’ll hear them because there’s no ‘chance in hell’ they’ll ever get passed the next two years with the Congress solidly Republican, and Obama knows it.  But the proposals will make for good campaign material for the Democrats in the next national election cycle, including presidential elections in 2016, which has already begun. And that’s what it’s all about.

With the lowest low voter turnout last November 2014 in over 70 years, at a mere 36%, Democrats are running scared. They’ve earned it.  Last November 2014 their major constituencies voted with their feet. Or perhaps we should say they conducted a sit-down strike, staying home, on their butts, and didn’t turn out to vote for Democrats. The Obama strategy of the past six years of ‘propose little and deliver less’ has cost him and the Democratic Party so far both houses of the US Congress. And polls show it may also cost them the presidency next time, since they’re already in a ‘come from behind’ position for the coming presidential race in 2016.

So the next two years Obama, and what remains of Congressional Democrats, will step up the rhetoric and ‘talk the talk’ after having refused to ‘walk the walk’, as they say, in the previous six years. They’ll put on their phony paper hats and march around holding their placards of progressivism, and start the process and cycle of fooling the people all over again (aka lying). It all starts in earnest with the upcoming SOTU address by the President this week.

What we may hear from Obama in his coming SOTU address are nice-sounding proposals for:

*paid sick leave for workers up to seven days a year

*paid family leave up to six weeks for federal workers with newborn children

*$900 a year lower mortgage insurance costs for 250,000 first time homebuyers

*a $60 billion program to provide free tuition for students at 2-year community colleges

*Infrastructure spending to provide millions of construction jobs

*Raising the federal minimum wage

*Higher capital gains and inheritance taxes for the richest 1% and tax cuts for the middle class

He’ll also make false claims about how the economy has finally fully recovered from the recession, trumpeting the creation of 6 million jobs since 2009.  But he won’t mention the fact that the labor force in the USA has shrunk by 5 million who have given up on getting jobs, or that the vast majority of jobs created have been underpaid and part time or temporary, or that the median working class family’s income has fallen every year since 2008 during the so-called ‘recovery’.

He’ll make threats to veto any Republican Congress legislation to approve the XL pipeline—but only because there’s already a massive glut of cheap oil in the USA and more oil from the tar sands/XL project would only lower oil company profits further. He’ll threaten to veto revisions to his Obamacare health program—after he’s already exempted millions of businesses from having to contribute to its costs.

As Obama and the Democratic Party desperately try to change their image, from partners with Corporate America to advocates for the working and middle classes once again before the next elections, the Republicans who now run Congress have already begun to change the rules of the legislative game in their favor.

While they publicly protest against Obama’s threats of ‘Executive Action’, they quietly engage in their own versions of ‘Legislative Action’, changing rules without passing bills, that amount to an intensifying campaign against the interests of working class Americans.

Here’s just a few of Republicans’ recent aggressive anti-worker initiatives working their way through Congress that may soon become law:

Redefining what is a full time worker, from present 30 hrs./week to 40 hrs.

This will impact 23 million workers who now work 30-39 hrs. a week and are considered full time employed.  By raising the definition of full time to 40 hrs., it will mean their employers will be able to exempt them from the Obamacare health coverage. Employers won’t have to pay a penalty if they refuse to help pay for their workers’ health insurance. That will save them potentially between $52 billion and $73 billion over the next decade. It will also mean hiring of even more part time/temp workers in the USA, with lower pay and no benefits, instead of full time workers.

Cut disability payments for 10.2 million workers now unable to work due to disability

This measure will slash benefits by 19% for the 10 million now receiving social security disability benefit payments. It will also force liberals in Congress to consider transferring funds from other social security programs—like retirement benefits and survivors benefits—if they want to avoid the disability program cuts.  That will accelerate the funding crisis in the general retirement fund of social security.  The plan is to use disability benefits as the ‘trojan horse’ to attack the entire social security program. As the new House of Representatives Chair of the Committee in charge of Social Security, Tom Price, recently put it: “Whether it’s means testing, whether it’s increasing the age of eligibility …. whether it’s providing much greater choices for individuals to voluntarily select the kind of manner in which they believe they ought to be able to invest their working dollars as they go through their lifetime. All those things ought to be on the table and discussed.”

Allow and encourage employers to cut their contributions to pension plans

Already passed as part of the recent Omnibus appropriations bill by Congress, employer are encouraged to start cutting pension benefits for 10 million workers covered under multi-employer pension (MEPs) union pension plans.

Rule changes to allow employers to pay ‘Comp-Time’ instead of overtime pay

By reducing hours worked per week to less than 40, should employers require work over 40 hours they would have to pay overtime at one and a half time regular pay.  In order to avoid having to pay overtime, Republicans propose employers give workers time off at regular pay for overtime hours worked. That saves them ‘one-half’ an hour pay. The proposal will result in tens of billions of dollars a year transferred from workers to companies.

Reverse and repeal Obama’s Immigration Executive Order

Instead of issuing an executive order last year to provide legalization for millions of undocumented workers in the USA, Obama merely issued an order to suspend deportations of workers—after having deported more than 2 million himself since 2009. Republicans will propose to restart the deportations, including children, pay contractors millions more for fences and drones, and allow instead tens of thousands more of skilled workers from Asia to take US tech jobs on H1-B visas that tech CEOs from Google, Microsoft and others are demanding.

End mandates that Employers provide health insurance for workers under Obamacare

Just as the health care law starts January 1, 2015 to require employers help pay for workers’ health insurance or else pay a penalty, the Republican Congress will pass legislation to exempt them altogether from doing so.  Republican strategy is to tie this provision to another bill that Obama strongly supports, so that he won’t veto it.

Continue to pick apart and end financial regulation of big banks

Republicans continue their step by step dismantling of Obama’s much-touted, but already ‘toothless tiger’ Dodd-Frank Banking Regulation Act passed in 2010.  With the help of Democrats in Congress, they have already gutted the Act last December in part. Now they have jointly agreed to postpone until 2019 another key provision to prevent banks from trading in highly toxic and unstable securitized financial instruments called ‘Collateralized Loan Obligations’—a kind of derivatives security that contributed to the 2008-09 banking crash.

‘Dynamic  Scoring’ to allow more corporate tax cuts

A recent rule change introduced by Republicans requires government agencies to false estimate economic growth from business tax cuts. This will add ‘on paper’ only estimates of US GDP growth from business tax cuts, giving further cover to pass more such tax cuts in the coming months.  ‘Dynamic  scoring’ is a phony technique to make it appear tax cuts create jobs, when all the real data of the past 15 years proves the contrary—business tax cuts destroy jobs.

So Obama will propose phony programs to shore up his and the Democratic Party’s shoddy image before the next elections, while Republicans will continue their very real aggressive attacks on US workers’ living standards.

As Republicans in Congress successfully change the rules, Obama and Democrats will try to change their stripes.  But as they say, you can’t change a Zebra’s stripes—they all run diagonally up to the right, and you can’t reverse them to appear they run up to the left.

As Obama attempts to change his appearance and Republicans continue to reveal their essence, both sides will work together cooperatively on the really big measures they have in mind—measures that will provide big benefits to their joint corporate campaign benefactors. These true focus measures of the coming months include:

*Approval of the $64 billion allotted for spending for new war with ISIS & Syria

*Big cuts in top corporate tax rates

*Passage of ‘fast track authority for the President to negotiate the TPP free trade deal

*New laws, under the cover of ensuring ‘cybersecurity’ to increase spying and surveillance of the American people by the NSA and other agencies.

These are the real issues in the coming year and session of Congress, that both Obama and Democrats and Republicans and their Teaparty faction in Congress are in total agreement on. These are the real priorities of Corporate America, and the two wings of their one party system are in agreement they will work closely together to deliver the goods.  After all, they have to fill their campaign coffers before the next election.

Jack Rasmus is the author of the forthcoming book, ‘Transitions to Global Depression’, Clarity Press, 2015; and Epic Recession: Prelude to Global Depression and Obama’s Economy, both by Pluto Press, 2010 and 2012.  His blog is jackrasmus.com and website www.kyklosproductions.com.

More articles by:

Jack Rasmus is author of the recently published book, ‘Central Bankers at the End of Their Ropes: Monetary Policy and the Coming Depression’, Clarity Press, August 2017. He blogs at jackrasmus.com and his twitter handle is @drjackrasmus. His website is http://kyklosproductions.com.

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