The Atlantic's James Fallows talks about something that used to happen a lot less, mostly because there were still some public figures who took pride in their personal integrity. That's why someone like Peter Orszag can go to work for Citibank and not bat an eye -- because it's been so long since he's seen anyone ever raise the issue, it probably never even occurred to him just how slimy it is:

Last night, on the "Virtually Speaking" discussion about the media with Jay Rosen of NYU, we talked about the phenomenon of things that everyone in the press corp "knows" but that don't make their way into news stories or broadcasts. One such category involves things that everyone suspects but can't quite prove -- for instance, how involved Dick Cheney and Karl Rove were in the Valerie Plame case. Or, to make it bipartisan, about Bill Clinton's sexual behavior over the years. But another category, which I think is even more important, involves things that everyone "knows" but has stopped noticing. This is very similar to what is called "Village" behavior in the big time media.

An item in this second category has just come up: the decision of Peter Orszag, until recently the director of the Office of Management and Budget under Barack Obama, to join Citibank in a senior position. Exactly how much it will pay is not clear, but informed guesses are several million dollars per year. Citibank, of course, was one of the institutions most notably dependent on federal help to survive in these past two years.

Objectively this is both damaging and shocking.

- Damaging, in that it epitomizes and personalizes a criticism both left and right have had of the Obama Administration's "bailout" policy: that it's been too protective of the financial system's high-flying leaders, and too reluctant to hold any person or institution accountable. Of course there's a strong counter argument to be made, in the spirit of Obama's recent defense of his tax-cut compromise. (Roughly: that it would have been more satisfying to let Citi and others fail, but the results would have been much more damaging to the economy as a whole.) But it's a harder argument to make when one of your senior officials has moved straight to the (very generous) Citi payroll. Any competent Republican ad-maker is already collecting clips of Orszag for use in the next campaign.

- Shocking, in the structural rather than personal corruption that it illustrates. I believe Orszag (whom I do not know at all) to be a faultlessly honest man, by the letter of the law. I am sorry for his judgment in taking this job,* but I am implying nothing whatsoever "unethical" in a technical sense. But in the grander scheme, his move illustrates something that is just wrong. The idea that someone would help plan, advocate, and carry out an economic policy that played such a crucial role in the survival of a financial institution -- and then, less than two years after his Administration took office, would take a job that (a) exemplifies the growing disparities the Administration says it's trying to correct and (b) unavoidably will call on knowledge and contacts Orszag developed while in recent public service -- this says something bad about what is taken for granted in American public life.

When we notice similar patterns in other countries -- for instance, how many offspring and in-laws of senior Chinese Communist officials have become very, very rich -- we are quick to draw conclusions about structural injustices. Americans may not "notice" Orszag-like migrations, in the sense of devoting big news coverage to them. But these stories pile up in the background to create a broad American sense that politics is rigged, and opportunity too. Why do we wince a little bit when we now hear "Change you can believe in?" This is an illustration.

Former budget director Peter Orszag thinks the Bush tax cuts should be extended for two more years. I think he should pound sand.

Here's an excerpt (PDF) from President Obama's campaign literature in 2007-2008:

Restore Fiscal Discipline to Washington

[...]
Reverse Bush Tax Cuts for the Wealthy: Obama will protect tax cuts for poor and middle class families, but he will reverse most of the Bush tax cuts for the wealthiest taxpayers.

Nowhere in that literature does it say anything about extending tax cuts because Republicans aren't playing nice and are sticking their back ends in the President's face. Nowhere. Up till now, Obama has kept the majority of his campaign promises, even if they do not look exactly like we thought they should.

So along comes Peter Orszag, former White House budget director, with this little bomb:

In the face of the dueling deficits, the best approach is a compromise: extend the tax cuts for two years and then end them altogether. Ideally only the middle-class tax cuts would be continued for now. Getting a deal in Congress, though, may require keeping the high-income tax cuts, too. And that would still be worth it.

Not so much. This is the difference between how an accountant looks at things and how people look at them. I would gladly give up whatever piece of tax cuts would be coming to me to see the wealthy folks taxed at a reasonable rate.

Orszag can come up with all the reasonable arguments that accountants and economists make routinely, but nothing will change the fact that there was a promise made in 2007-2008. We all know Republicans won't make a whit of difference in the end anyway, since they have made it clear they won't play on any field at any time no matter how much is extended their way.

Higher taxes now would crimp consumer spending, further depressing the already inadequate demand for what firms are capable of producing at full tilt. And since financial markets don’t seem at the moment to view the budget deficit as a problem — take a look at the remarkably low 10-year Treasury bond yield — there is little reason not to extend the tax cuts temporarily.

Yes, there's a real big reason not to; namely, it would be a broken promise that would appear to me to be nothing more than giving into the schoolyard bullies. Perhaps we could hand over our lunch money, too, and while we're at it, would we also like to let them raise the Social Security retirement age to 75 and let oil companies sit at the right hand of the President?

This is not a cut-and-dried issue. This is emotional. From my perspective, what the Bush tax cuts got me was no economic growth for the last decade and multiple threats to my future security. I see absolutely no reason to budge on this. None.

Fortunately, Mr. Orszag is no longer the White House budget director. I hope that means he and the President don't see eye to eye on this particular question and he's looking for a pickup by one of those rich dudes who don't pay much in taxes.

Looks like President Obama is punting on a campaign promise until after the mid-term elections. If I was completely sure he'd back the repeal, I wouldn't care - but I'm never quite sure with him.

I'm really tired of gay issues being sent to the bottom of the agenda. How can we keep asking gay people to support the Democrats when they get so little in return?

President Obama has endorsed to a "don't ask, don't tell" compromise between lawmakers and the Defense Department, the White House announced Monday, an agreement that may sidestep a key obstacle to repealing the military's policy banning gays and lesbians from serving openly in the armed forces.

The compromise was finalized in meetings Monday at the White House and on Capitol Hill. Lawmakers will now, within days, take a series of votes on amendments that repeal the Clinton-era policy, with a provision ensuring that any change would not take effect until after the Pentagon completes a study about the impact on troops. That study is due to Congress on Dec. 1.

In a letter to lawmakers pushing for a legislative repeal, White House budget director Peter Orszag wrote Monday that Obama's administration "supports the proposed amendment."

"Such an approach recognizes the critical need to allow our military and their families the full opportunity to inform and shape the implementation process through a thorough understanding of their concerns, insights and suggestions," Orszag wrote.

While gay rights advocates hailed the move as a "dramatic breakthrough," it remained uncertain whether the deal would secure enough votes to pass both houses of Congress. Republicans have vowed to maintain "don't ask, don't tell," while conservative Democrats have said they would oppose a repeal unless military leaders made clear that they approved of such a change.

Even if the compromise language passes, a legislative repeal would go into effect only after Obama certifies that the change does not harm the nation's military readiness.

I continue to worry that at some point, Wall Street will convince the administration that it would be a great psychological ploy to cut off unemployment compensation to convince the market there's a recovery.

And if they do that, all hell will break loose:

March 16 (Bloomberg) -- U.S. employers won’t hire enough workers this year to lower the jobless rate much below the level of 9.7 percent reached in February, three Obama administration economic officials said today.

The proportion of Americans who can’t find work is likely to “remain elevated for an extended period,” Treasury Secretary Timothy F. Geithner, White House budget director Peter Orszag and Christina Romer, chairman of the Council of Economic Advisers, said in a joint statement. The officials said unemployment may even rise “slightly” over the next few months as discouraged workers start job-hunting again.

“We do not expect further declines in unemployment this year,” the officials said in testimony prepared for the House Appropriations Committee. They predicted the economy would add about 100,000 jobs a month on average -- not enough to bring the jobless rate down substantially.

Today’s projections are in line with the 10 percent average unemployment forecast for this year in last month’s budget plan. Christopher Rupkey, chief financial economist at Bank of Tokyo Mitsubishi UFJ Ltd. in New York, said the administration’s language risks damping expectations for a recovery.

“They need to work on the message, and right now the message is that there is not a lot to be hopeful about,” Rupkey said. “Warning about a slow jobless recovery can help make it a reality.”

The New York Times Sunday Magazine has a lengthy interview with Obama this morning, focused on the economy. This is from the discussion on health-care reform:

THE PRESIDENT: First of all, I do think consumers have gotten more active in their own treatments in a way that’s very useful. And I think that should continue to be encouraged, to the extent that we can provide consumers with more information about their own well-being — that, I think, can be helpful.

I have always said, though, that we should not overstate the degree to which consumers rather than doctors are going to be driving treatment, because, I just speak from my own experience, I’m a pretty-well-educated layperson when it comes to medical care; I know how to ask good questions of my doctor. But ultimately, he’s the guy with the medical degree. So, if he tells me, You know what, you’ve got such-and-such and you need to take such-and-such, I don’t go around arguing with him or go online to see if I can find a better opinion than his.

And so, in that sense, there’s always going to be an asymmetry of information between patient and provider. And part of what I think government can do effectively is to be an honest broker in assessing and evaluating treatment options. And certainly that’s true when it comes to Medicare and Medicaid, where the taxpayers are footing the bill and we have an obligation to get those costs under control.

Q. And right now we’re footing the bill for a lot of things that don’t make people healthier.

THE PRESIDENT: That don’t make people healthier. So when Peter Orszag and I talk about the importance of using comparative-effectiveness studies (9) as a way of reining in costs, that’s not an attempt to micromanage the doctor-patient relationship. It is an attempt to say to patients, you know what, we’ve looked at some objective studies out here, people who know about this stuff, concluding that the blue pill, which costs half as much as the red pill, is just as effective, and you might want to go ahead and get the blue one. And if a provider is pushing the red one on you, then you should at least ask some important questions.

It's a very enlightening interview; a few things came to mind after reading it, the first being that provider incompetence is exacerbated by our present system. Sometimes doctors screw up because they're trying to push so many people through their office in the shortest possible amount of time. Under a for-profit system driven by volume, that's the most lucrative strategy.

So unlike the president, even though I usually go to top-notch doctors at excellent teaching hospitals, I always question their judgment. Anyone who stops asking questions does so at their peril.

The other is (and you may not know this), there are some important differences between some brand name drugs and their generic equivalents, mostly as a result of a patient's personal chemistry. It's also an open secret that drugs, brand-name or not, only work on some people. This quote from a GlaxoSmithKline VP a few years ago created quite a stir at the time:

"The vast majority of drugs - more than 90 per cent - only work in 30 or 50 per cent of the people," Dr [Allen] Roses said. "I wouldn't say that most drugs don't work. I would say that most drugs work in 30 to 50 per cent of people. Drugs out there on the market work, but they don't work in everybody."

And this is one of the reasons why I believe that anything short of a public plan will not be truly cost-effective. As long as a health plan is predicated on making money for the insurance and pharmaceutical companies, consumers will be short-changed.

The truth may set you free, but not if you're a Republican and the subject is taxes. After all, 95% of American families as promised received a tax cut from the Obama stimulus package. And while three-quarters of Americans support President Obama's proposal to roll back the Bush tax cuts for those earning over $250,000 to their Clinton-era levels, it turns out that affluent voters, too, chose Barack Obama over John McCain. Making matters worse, a Gallup poll Monday revealed that Americans' "views of income taxes among most positive since 1956."

So as their furious followers head off to their April 15th orgy of tea-bagging, the leadership of the GOP and its amen corner in the right-wing media have instead turned to tall tales on taxes.

Here, then, are 10 Republican Tax Day lies:

1. President Obama will raise taxes on small businesses.
2. The estate tax devastates small businesses and family farms.
3. 40% of Americans pay no taxes.
4. Tax cuts always increase revenue.
5. The GOP is the party of fiscal discipline.
6. Ronald Reagan was the greatest tax cutter of all time.
7. FDR caused the Great Depression, or at least made it worse.
8. Obama's cap-and-trade plan will cost each American family $3,100 a year.
9. Obama's tax proposals will undermine charitable giving.
10. The rich pay too much in taxes already.

For the details behind each of the GOP's Tax Day deceits, continue reading.

Continue reading »

Talk about stating the obvious! Welcome to reality, guys:

President Obama ditched his bipartisan budget sales pitch Tuesday and went on the offense against his Republican critics. The move comes after the president felt substantial pushback from lawmakers in both parties who sharply attacked key elements in his $3.55 trillion proposal.

Sensing the lack of support, Obama has changed strategies and challenged members of Congress who have blasted his plan to come up with “constructive alternative solutions.” While the president said that he and Democrats are committed to a budget resolution that will put the nation on a path to prosperity, he decried opponents who have turned to “political tactics” and “point scoring” instead of “problem solving.”

[...] This time around, Obama appears to be employing a more partisan strategy. Obama’s top budget aide, Peter Orszag, went further in dismissing Republican critiques on Tuesday, saying that most reflected a viewpoint that “just empirically doesn’t work.”

Orszag, the Office of Management and Budget director, said some lawmakers’ suggestions during congressional hearings have been helpful, but input elsewhere hasn’t been.

“The chatter that fills the cable news networks I don’t think is intended to be constructive,” Orszag said at a lunch with reporters sponsored by The Christian Science Monitor.

[...] In response to GOP attacks, Obama and his allies are shifting into campaign mode. Obama is scheduled to push his budget plan during a rare sit-down interview Thursday on “The Tonight Show.” His presidential campaign manager, David Plouffe, sent an e-mail to his backers last weekend asking them to support the budget plan. And MoveOn.org, which galvanized liberals online to oppose President Bush’s agenda, has been asking its members to get behind Obama’s proposal.