Tuesday, August 30, 2011

Ron Johnson's 12-point Plan to Save the Economy Achieve Relevance

The Moonie Review gave Ron Johnson some real estate on its august pages to rap with the hoi polloi and the results are ... pretty much what we've come to expect from Johnson op-eds: unfocused, atonal dog whistles without much substance.

On the plus side, however, Johnson has finally come out with a list of projects that will define his tenure in the Senate. It's only been a year and a half since declared his candidacy, ten months since he won the election, and eight months since he took office, but he's finally got a plan!

It's as close to a checklist of goals as your going to find from Johnson. A diligent voter would cut out the article and tape it to his or her fridge, then, in 2016, go through the list to see what Johnson has accomplished during his term. (You can also bookmark this post, too!)

So, without further ado, here Ron Johnson's 12-point Plan to Save the Economy:
  • Repeal of Obamacare
  • Repeal of Dodd-Frank
  • Passage of S. 1438, the so-called "Regulation Moratorium and Job Preservation Act"
  • Passage of "Cut, Cap and Balance"
  • Tax Reform
  • Implementation of "zero-based" budgeting
  • Make all entitlements structurally solvent through FY 2089 by FY 2014 (i.e. passage of the Paul Ryan Budget)
  • Turn all mandatory budget spending into discretionary budget spending
  • Biennial budgets
  • Civil Service hiring freeze
  • Expand domestic oil drilling
  • Creation of Congressional "sunset" committees
Let's take a look at these points in greater detail. Here's the preamble:
As the former chief executive officer of a midsized manufacturing business, I do understand the value of the real job producers in America. I also understand how Mr. Obama’s policies affect their ability to expand their businesses and create new jobs. What we need to do to get our economy moving again is pretty obvious. Here’s a short outline of the necessary components of a solution:

Here’s a short outline of the necessary components of a solution:
 c Repeal Obamacare and Dodd-Frank: Neither of these laws fixed the problems they were designed to solve, and instead, they do far more harm than good.
Much of Obamacare has yet to be enacted and the Dodd-Frank legislation was intended to regulate the financial services sector, the kind people who got us in this economic mess in the first place. Repealing Dodd-Frank will not necessarily make manufacturers want to hire more laborers. It may motivate financial services firms to hire a few more traders and/or analysts, but a Dodd-Frank repeal is little more than a gift to bankers.

And not much of a gift at that. Dodd-Frank left the specifics of the enforcement agency it "created" for other law-makers to worry about, a situation that was illustrated rather well by this Daily Show sketch. Repeal Dodd-Frank is almost entirely empty rhetoric intended to appeal to Wall Street donors' wallets. It's not policy.

c Regulation moratorium: The $1.75-trillion-per-year regulatory burden is making the United States a very unattractive place for global business investment. Imposing a moratorium on new regulations is a necessary first step in reversing the damage. A bill I introduced last month would do just that.
This isn't going to happen. Johnson's bill is an entirely unserious legislative tantrum that, according to the Weekly Standard:
Johnson has just introduced the S. 1438, the Regulation Moratorium and Job Preservation Act. The bill calls for a moratorium on federal regulations until the unemployment rate hits 7.7 percent – which is just below what it was when President Obama was sworn into office.
You can imagine how much thought went into that nonsense. This is a snotty, deeply cynical bill that is little more than a flaming bag of dogshit left on the White House front porch. If this is the best Johnson can do, the next five years will be an unspeakable waste.
c Credible plan to control spending: The elements of the “Cut, Cap and Balance” plan had the support of 66 percent to 74 percent of the American people. Once consumers and investors are convinced we have spending under control, confidence will return to our economy.
This is more or less support for a piece of legislation that has little chance of passage with a Democrat in the White House, but the fascinating thing about this statement is that Johnson seems to believe that consumer confidence exists solely in an inverse ratio with government spending, which would be baffling to just about any economist.
c Tax reform: Our 70,000-page tax code costs taxpayers more than $300 billion in annual compliance costs to raise $2.2 trillion in revenue. It is riddled with special treatments that result in less efficient economic behavior. Reforms should make the system more streamlined in a way that promotes rather than harms economic growth.
Tax reform is something we can probably all agree on, the problem arises when we start to discuss the specifics. Republicans tend to want flatter and lower rates, I'd venture to say that Dems are more concerned with plugging loopholes. I'm not really sure which approach Johnson is advocated here. An example of a "special treatment" that results in less efficient economic behavior would have been nice.
c Budget reform: I will work with House members to pass legislation that will:
1. Replace “base-line” budgeting with “zero-based” budgeting.

2. Require Congress and the administration to make all entitlements structurally solvent for 75 years by fiscal 2014.

3. Require all spending to be authorized regularly by Congress. (Currently, 70 percent of the budget is on automatic pilot.)

4. Replace the annual budget process with a biennial budget process that authorizes spending in Year 1 and conducts spending oversight in Year 2.
#1 won't happen without a GOP takeover of Congress and the White House -- and even then it will be difficult for Republicans to resist the urge to spend money like they did in 2003-2006. Johnson's running out of time on #2. I don't know what kind of difference Johnson thinks #3 is going to make: does he really believe any elected official is going to vote against allocating that year's Social Security or Medicare funds, which is exactly what comprises the 70% on "automatic pilot" he wants Congress to vote on?

Which brings us to #4. In theory -- and I have to give the devil his due on this one -- biennial budgeting might not be such a bad idea. The problem with two-year federal budgets is that it makes government even less responsive to the unforeseeable needs of the people. To use a wildly hyperbolic analogy: Johnson's suggestion takes Stalin's five-year plans and turns them into two-year plans. There are a number of other issues that arise with two-yer budgets, but it might not be such a bad idea for certain aspects of the budget, like defense spending, perhaps. This way defense contractors would only have one chance every two years to win money for their extravagantly expensive weapon systems. On the other hand, firms like Oshkosh Corp. would lose out on contracts for MRAPs that have saved soldiers lives in Afghanistan and Iraq. So, you can see the dilemma here.

Before we move on, let take another look at #2. The only plan I've seen that claims to make all entitlements -- in other words, both Social Security and Medicare -- "solvent" in 75 years starting in 2014 is the Paul Ryan plan, which has been called a "75 year plan" by Eric Cantor, among other Republicans. So let's point out the obvious here: Johnson is backing Paul Ryan's plan in this editorial, he's just not calling it "the Ryan Plan" for obvious reasons.
c Civil service hiring freeze: Controlling the size of the federal work force would be a powerful tool in limiting the size, scope and cost of government.
Again, an easy thing to propose, but one that has limits. Right now there are 2 million federal civilian employees (sans military and post office employees). That's about the size of Wal-Mart's workforce. Now I'm not one of those lefty nutters who hates on Wal-Mart, but I do think the role of the federal government is far more complicated and important than Wal-Mart's in American society.

Besides, a freeze of hiring civil servants is usually circumvented by hiring subcontractors which can frequently be more expensive in the long run (depending on the task at hand).
c Energy security: The United States should protect our national security and help ensure price competition by fully utilizing our own natural energy resources.
Drill here, drill now! Again, another empty talking point. Opening up ANWR or the entire Gulf coast for drilling (which is currently outlawed by the state of Florida, by the way, not the federal gov't) will provide a few jobs to one industry and might lower gas prices for a short time, but it will doubtfully have an impact on the economy because American demand for oil out-strips any injection of supply our natural resources can possible introduce into the market.

c Congressional “sunset” committees: Both the House and Senate should have permanent committees whose only focus would be on the elimination of unneeded laws and regulations. More often than not, government has become part of the problem instead of the solution.
 Another committee ... that will do the trick. Either do the job yourself, or don't do it; but don't give the job to another group of 12 Senators who will just argue and bicker about Topic X when they could be doing something more important (or arguing and bickering about Topic Y). Committees are where solutions go to do die. No "chief executive officer of a midsized manufacturing business" would ever allocate important financial decisions to a committee when he can make the call himself.

So there you have it. These are the 12 things Ron Johnson wants to accomplish during his time in office.

One of the chief problems I have with this editorial is that it's written like the author was still running for office, not a sitting United States Senator. Senators write these types of op-ed pieces all the time, but their usually about one single issue, they usually describe the author's proposed solution and provide a primer on the rationale behind the fix. Johnson's piece is scatter-shot and doesn't even treat any of his proposed solutions in even superficial depth.

Any one of the Johnson 12 points would be a legislative accomplishment in and of itself. This plan feels like asking a five year old girl what she wants to be when she grows up and having her reply "I want to be a princess-veterinarian-astronaut-teacher-actress-scuba diver-singer-nurse!" Pick one and stick with it. It's going to take a ton of work and a pretty plan to make one of these things law. Maybe we'll see that plan in another 8-18 months.

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