Will Republicans Stop Reforms By Not Funding Them? Probably.

One of the little details lost among the health care reform, financial reform and every other reform since President Obama took office was when those so-called reforms were going to take effect.  It turns out that little detail might just come back and bite Obama and the Democrats in the butt.

None of the reforms were scheduled to take effect right away.  That’s because they had to be funded by Congress to take effect.  And since the Congressional Democratic leadership and President Obama’s staff couldn’t take the time to organize themselves and get their business done as quickly as possible, there wasn’t enough time left in this session to pass the 2011 fiscal year budget.  Even though the fiscal year started on October 1st (yes, 2.5 months ago).  So what Congress has done instead is pass funding through continuing resolutions.

Unfortunately, they mean what they sound like: they continue current funding.  They don’t allocate new funding.  They don’t change funding levels for anything.  They continue funding.  The latest continuing resolution that passed Congress today funds the government through March 2011.  That’s after Republican Teabaggers take control of the House of Representatives, where all spending bills must originate.  There will be fewer Democratic Senators in March 2011 than there are now.  The President has displayed an obsessive desire to negotiate with right-wing extremists and beat up on his base.  Guess what’s going to happen the next time the budget comes up for debate and votes?

I’m betting Republican Teabaggers take the budget and de-fund all of President Obama’s and the Democrats’ absurdly over-negotiated reforms. Furthermore, I’m betting President Obama doesn’t fight the Republican Teabaggers on not funding his “victories”.  He’s shown himself to care more that nobody is fighting than in passing good policies.  Too few Democrats realized this political weakness prior to putting him into office.  Now they have no choice.  Democrats got frustrated in 2009 and 2010 when Obama didn’t push for the most he could get even when perfect situations screamed for him to do so.  Just wait until he rolls over on issue after issue as Republican Teabaggers warm up their “spending is too high” talking points and begin investigating his administration for every silly, petty thing Teabaggers can dream up.

Which leads me again to address all the incrementalists that told liberal activists that we had to take what we could get and not expect a centimeter more: if your so-called reforms aren’t funded, what good are they?  How much time, energy and money was wasted moving a pathetic distance toward solving some of this nation’s crises but won’t be enacted because of your overwhelming pragmatism?

How willing will Democrats be to donate to President Obama’s re-election campaign when these things happen?  How many doors will they knock on?  How many phone calls will they make?  When the reforms go down in flames and unemployment stays high (because Obama never seriously addressed the Great Recession), will there be a 2012 “enthusiasm gap” that outshines the 2010 version?  Only time will tell.

Financial “Reform”: Just Like Health Insurance “Reform”

Democrats are on pace to waste on of the largest one-party majorities in history.  Given the size of the caucus in each chamber of Congress, most Americans assumed that something would be done to address the multiple crises this country faces.  You do know what happens when people assume things, don’t you?  It turns out that old adage was true.  Great and needed reforms have not been the products of this Congress.  Edge-nibbling and incrementalism have been the products instead.

Financial industry reform was supposed to be the next great thing that Congress took up.  It’s desperately needed: thanks to a bunch of billionaires, Wall St. has turned into America’s largest set of casinos.  Unlike the ones found in Las Vegas, these casinos are unregulated and have a more direct impact on Americans’ lives.  Witness the 2008-2010 Great Depression redux if you want an idea of how out of control these banksters have gotten.

I recommend reading a short piece by Les Leopold.  He starts out with (emphasis mine):

Wake up Congress! The financial reform bill you just passed won’t protect us from economic chaos. Why? Because it fails to burst the mother of all bubbles — Wall Street itself.

Despite that simple fact, Americans will start being subjected to pandering politicians selling their “look what we accomplished” bs.  How many will be reelected?  Or, how many will fall to the wave that I see building during this year’s election cycle: Americans want tangible solutions passed.  Politicians might get away for a short while telling us how awesome they are.  What happens when the economy crashes again?  What happens when people realize how little health care insurance legislation accomplishes for them and how much it accomplishes for the failed system?

After a short discussion, Les offers up 5 necessary reforms:

1. Break up the top twenty banks that are too big too fail.

2. Institute a financial transaction tax.

3. Pass a windfall profit tax of 75 percent on Wall Street bonuses and hedge fund income.

4. Raise the marginal tax rate on those earning $3 million or more per year to 70 percent.

5. Ban the sale of complex derivatives to all public entities and pension funds and ban public and pension investments in hedge funds.

To do any of these, however, would require elected officials that have not been thoroughly bought off by the financial industry.  That’s one reason we’re in the mess we’re in.

Those large majorities I started out with won’t last forever.  Congress members are going to want to travel back to their districts and states in a couple of months – which means the time for actual work to get done is quickly dwindling.  What will happen next year when there are even fewer Democrats?  How long will it take to get a meaningful number of solid progressives in place to exert influence?