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Myth McConnell

May 21, 2012

In the wake of the debt ceiling crisis he helped manufacture last summer, Senate Minority Leader Mitch McConnell boasted it was "a hostage that's worth ransoming" which "also is a new template" for the future. As it turns out, those threats were among the few true words McConnell has uttered. Because while he's promising once again to blackmail the White House over the debt ceiling, the Kentucky Republican claimed it's because "we'd like to do something about the nation's biggest problem, spending and debt, which of course is the reason for this economic malaise." Of course, as the data show, it's the very austerity policies here and in Europe which are costing jobs and hurting growth.
But Mitch McConnell's myth-making hardly ends there. On the economy, taxes, deficits, health care and so much else, virtually all of McConnell's talking points are tried - and untrue.

(Click a link to jump to the details for each below):

"Obama Made the Economy Worse"
For months, Mitch McConnell (for example, here, here and here) regurgitated the GOP talking point that President Obama "made the economy worse." Sadly for the trickle-down mythmakers of the Republican Party, the facts and the overwhelming consensus of economists - including John McCain's 2008 brain trust - prove otherwise. President Obama not only did not make the American economy worse; no thanks to obstructionist Republicans in Congress he saved the United States from "Great Depression 2.0" and put the nation on the path to recovery.
Start, for example, with the conclusions of the nonpartisan Congressional Budget Office (CBO). Despite Republican mythmaking that the American Recovery and Reinvestment Act (ARRA) "created zero jobs," in November the CBO reported that the stimulus added up to 2.4 million jobs and boosted GDP by as much as 1.9 points in the previous quarter. As The Hill explained, the CBO has found that "President Obama's 2009 stimulus package continues to benefit the struggling economy":

The agency said the measure raised gross domestic product by between 0.3 and 1.9 percent in the third quarter of 2011, which ended Sept. 30. The Commerce Department said Tuesday that GDP in that quarter was only 2 percent total...
By CBO's numbers, the $800 billion stimulus added up to 0.9 million jobs in 2009, 3.3 million jobs in 2010 and 2.6 million jobs in 2011.

Mark Zandi, an adviser to John McCain in 2008, was adamant on positive role of the stimulus. Federal intervention, he and Princeton economist Alan Blinder argued in August 2010, literally saved the United States from a second Great Depression. In "How the Great Recession Was Brought to an End," Blinder and Zandi's models confirmed the impact of the Obama recovery program and other federal interventions dating back to 2008, concluding that "laissez faire was not an option":

We find that its effects on real GDP, jobs, and inflation are huge, and probably averted what could have been called Great Depression 2.0. For example, we estimate that, without the government's response, GDP in 2010 would be about 11.5% lower, payroll employment would be less by some 8½ million jobs, and the nation would now be experiencing deflation.

"No Evidence Whatsoever That the Bush Tax Cuts Actually Diminished Revenue"
In his version of the Republican myth that "tax cuts pay for themselves," President Bush confidently proclaimed, "You cut taxes and the tax revenues increase." As it turned out, not so much.
After Ronald Reagan tripled the national debt with his supply-side tax cuts, George W. Bush doubled it again with his own. (Reagan's performance would have been much worse, had he not raised taxes 11 times to help make up the shocking shortfall.) As a share of American GDP, tax revenues peaked in 2000; that is, before the Bush tax cuts of 2001 and 2003. As the Center on Budget and Policy Priorities concluded, the Bush tax cuts accounted for half of the deficits during his tenure, and if made permanent, over the next decade would cost the U.S. Treasury more than Iraq, Afghanistan, the recession, TARP and the stimulus - combined.

Nevertheless, as the Republican Party waged its all-out attack in 2010 to preserve the Bush tax cuts for the wealthy, the GOP's number two man in the Senate provided the talking point to help sell the $70 billion annual giveaway to America's rich. "You should never," Arizona's Jon Kyl declared, "have to offset the cost of a deliberate decision to reduce tax rates on Americans." For his part, Senate Minority Leader Mitch McConnell rushed to defend Kyl's fuzzy math:

"There's no evidence whatsoever that the Bush tax cuts actually diminished revenue. They increased revenue because of the vibrancy of these tax cuts in the economy. So I think what Senator Kyl was expressing was the view of virtually every Republican on that subject."

That may have been a view universally shared by virtually every Republican, but it happens to be wrong.
"Punishing Job Creators"
For years, Senator McConnell has been among the legions of Republicans wrongly arguing that even the slightest increase in taxes for the wealthiest Americans is tantamount to "punishing job creators." As his colleague John Boehner put it:

"The top one percent of wage earners in the United forty percent of the income taxes...The people he's [President Obama] is talking about taxing are the very people that we expect to reinvest in our economy."

If so, those expectations were sadly unmet under George W. Bush. After all, the last time the top tax rate was 39.6 percent during the Clinton administration, the United States enjoyed rising incomes, 23 million new jobs and budget surpluses. Under Bush? Not so much.
On January 9, 2009, the Republican-friendly Wall Street Journal summed it up with an article titled simply, "Bush on Jobs: the Worst Track Record on Record." (The Journal's interactive table quantifies his staggering failure relative to every post-World War II president.) The meager one million jobs created under President Bush didn't merely pale in comparison to the 23 million produced during Bill Clinton's tenure. In September 2009, the Congressional Joint Economic Committee charted Bush's job creation disaster, the worst since Hoover.
That dismal performance prompted David Leonhardt of the New York Times to ask last fall, "Why should we believe that extending the Bush tax cuts will provide a big lift to growth?" His answer was unambiguous:

Those tax cuts passed in 2001 amid big promises about what they would do for the economy. What followed? The decade with the slowest average annual growth since World War II. Amazingly, that statement is true even if you forget about the Great Recession and simply look at 2001-7...
Is there good evidence the tax cuts persuaded more people to join the work force (because they would be able to keep more of their income)? Not really. The labor-force participation rate fell in the years after 2001 and has never again approached its record in the year 2000.
Is there evidence that the tax cuts led to a lot of entrepreneurship and innovation? Again, no. The rate at which start-up businesses created jobs fell during the past decade.

The data are clear: lower taxes for America's so called job-creators don't mean either faster economic growth or more jobs for Americans.

As Jared Bernstein aptly put it earlier this month:

"Tax cuts and job growth? They're just not that into each other."

"We Look a Lot Like Greece Already"
As their last round of hostage-taking of the debt heated up last summer, Republicans including Mitch McConnell warned, "We look a lot like Greece."
hile was quick to conclude that "whatever it 'looks like' through Sen. McConnell's eyes -- the fact is that the U.S. is not yet a fiscal wreck of Greek proportions," its analysis hardly does justice to the scale of the Republican myth-making. The Washington Monthly's Steve Benen summed it up quite succinctly:

New rule: every time a confused Republican lawmakers compare the United States' fiscal conditions to that of Greece, an angel loses its wings.
Look, the very idea is just crazy. The U.S. has extremely low interest rates and foreign investor are happy to loan us money; Greece has extremely high interest rates and no one is eager to loan the country money. The U.S. has our own currency; Greece has the Euro. We have a great credit rating (for now); Greece has an awful credit rating. We have a manageable debt; Greece has a debt crisis. We're a large country with an enormous economy; Greece is a small country with a small economy. We have one of the world's most stable systems of government (at least until six months ago); Greece's government structure is a little shaky.

For his part, Nobel Prize-winning economist and New York Times columnist Paul Krugman has been decrying the "Hellenization of economic discourse" for months. "Greece -- with a long history of fiscal irresponsibility, very high public debt, and a country without a currency -- doesn't bear much resemblance even to the other peripheral Europeans, let alone the United States."

Here's debt levels (if you ask me the IMF projections for Greece are too optimistic):
Plus there's the having your own currency thing, and the fact that the interest rate on US 10-year bonds is 3.11 percent, on Greek bonds 16.82 percent.
Otherwise we're exactly the same.

Public Sector Layoffs a "Local" Problem
Last fall, Minority Leader McConnell led the GOP opposition to President Obama's proposed $400 billion American Jobs Act. The loss of hundreds of thousands of police, firefighter, teacher and other public sector jobs, he insisted, was a "local" problem.
As it turns out, the 600,000 state and local government jobs already lost since December 2008 is very much a national issue. That "anti-stimulus," it turns out, has added a full point to America's unemployment rate.
Last month, the Economic Policy Institute noted that the private sector had gained 2.8 million jobs while federal, state and local governments shed 584,000 just since June 2009. EPI concluded that the public sector job losses constituted "an unprecedented drag on the recovery":

"The current recovery is the only one that has seen public-sector losses over its first 31 months."

Back in March, Paul Krugman expressed the same point, but with some inconvenient historical context for the Party of Reagan. "In fact, if it weren't for this destructive fiscal austerity," Krugman explained, "Our unemployment rate would almost certainly be lower now than it was at a comparable stage of the 'Morning in America' recovery during the Reagan era."

We're talking big numbers here. If government employment under Mr. Obama had grown at Reagan-era rates, 1.3 million more Americans would be working as schoolteachers, firefighters, police officers, etc., than are currently employed in such jobs.
And once you take the effects of public spending on private employment into account, a rough estimate is that the unemployment rate would be 1.5 percentage points lower than it is, or below 7 percent -- significantly better than the Reagan economy at this stage.

47 Million Uninsured Americans "Don't Go Without Health Care"
McConnell the "strict obstructionist" was naturally in the forefront of the all-out Republican effort to block health care reform at any cost. As he repeatedly put it in June 2009, "all of us want reform, but not reform that denies, delays, or rations health care." To prove his point, McConnell didn't merely trot out a Canadian patient who came to the U.S. for special treatment, but insisted to NBC's David Gregory that no American does without health care now.

GREGORY: Do you think it's a moral issue that 47 million Americans go without health insurance?
McCONNELL: Well, they don't go without health care. It's not the most efficient way to provide it. As we know, the doctors in the hospitals are sworn to provide health care. We all agree it is not the most efficient way to provide health care to find somebody only in the emergency room and then pass those costs on to those who are paying for insurance. So it is important, I think, to reduce the number of uninsured. The question is, what is the best way to do that?

That President George W. Bush, Tom Delay and Paul Broun among other Republicans also claimed "people have access to health care in America...after all, you just go to an emergency room" doesn't make it any more true. As the numbers show -- 50 million uninsured, another 25 million underinsured, 45,000 unnecessary deaths, one in five Americans "self-rationing" care and 62 percent of all personal bankruptcies being related to medical bills -- the crisis is far worse than the one Mitch McConnell pretends doesn't exist.
The Public Option "May Cost You Your Life"
While Mitch McConnell insisted that the lack of insurance doesn't prevent anyone from getting health care, in 2009 he suggested having coverage could prove fatal. Months before the passage of the Affordable Care Act without the so-called "public option," Minority Leader McConnell said it would be deadly.
That irresponsible fear-mongering came during an appearance on Dennis Miller's radio show in October 2009. Blasting the "opt-out" version of the public option then being considered in the Senate bill, the Senator from the state ranked 45th in health care performance insisted access to coverage could kill you:

MCCONNELL: Well, it doesn't make any difference frankly whether you opt-in or you opt-out, it's still a government plan. You know, Medicaid, the program for the poor now, states can opt-out of that, but none of them have. I think if you have any kind of government insurance program, you're going to be stuck with it and it will lead us in the direction of the European style, you know, sort of British-style, single payer, government run system. And those systems are known for delays, denial of care and, you know, if your particular malady doesn't fit the government regulation, you don't get the medication.
MILLER: Right.
MCCONNELL: And it may cost you your life. I mean, we don't want to go down that path.

As a Harvard Medical School study found, each year the path of no health insurance leads 45,000 Americans to the grave.
Democrats Are "Sticking It to Seniors with Cuts to Medicare"
For two years running, Mitch McConnell has been among the 40 GOP Senator voting for Paul Ryan's House budget plan to privatize and inevitably ration Medicare now used by 46 million American seniors. In the late 1990's, McConnell joined in Newt Gingrich's effort to slash almost 15 percent from the Medicare budget so that the program would "wither on the vine." But when the Affordable Care Act called for savings from the private Medicare Advantage program used by only 15 percent of elderly beneficiaries, it was Mitch McConnell who warned seniors about the mythical danger.
In July 2009, McConnell tried to scare America's 46 million Medicare beneficiaries by declaring, "The administration plans to use Medicare cuts to fund yet another new government program." Hoping to build on the momentum of the GOP's disgusting and demonstrably false "euthanasia" talking point, McConnell cautioned:

"Some in Congress seem to be in such a rush to pass just any reform, rather than the right reform, that they're looking everywhere for the money to pay for it -- even if it means sticking it to seniors with cuts to Medicare."

That salvo comes just two weeks after McConnell promised to defeat health care reform in the Senate, warning America's highest turnout voting block:

"They are going to pay for this plan by cutting Medicare, that is cutting seniors."

Those claims, the New York Times pointed out the day after the Republicans' overwhelming triumph in the 2010 midterms elections were misleading at best and false at worst. But, sadly, they worked.
And so it goes.
As Joshua Green documented last year in the Atlantic, "Mitch McConnell is a master manipulator and strategist" whose "relentless tactics have made his party victorious." But that doesn't make him a truth-teller, except on those rare occasions when he reveals his true motivations. During the debt ceiling stand-off last summer, McConnell briefly got weak in the knees at the prospect of U.S. sovereign default not because it would be a disaster for the nation, but because it could damage his Republican Party:

"I refuse to help Barack Obama get re-elected by marching Republicans into a position where we have co-ownership of a bad economy. ... If we go into default, he will say that Republicans are making the economy worse and try to convince the public -- maybe with some merit, if people stop getting their Social Security checks and military families start getting letters saying service people overseas don't get paid. It's an argument he could have a good chance of winning, and all of the sudden we have co-ownership of a bad economy," he said. "That is very bad positioning going into an election."

Especially an election which marks the culmination of Mitch McConnell's work over the past three and a half years:

"The single most important thing we want to achieve is for President Obama to be a one-term president."


Jon Perr
Jon Perr is a technology marketing consultant and product strategist who writes about American politics and public policy.

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