Saturday was the Ames straw poll. Michele Bachmann won it. Tim Pawlenty didn't. That was to be expected, said Pawlenty's team. He had said he needed to finish sixth or better, and he in fact finished third.In the peculiar language of political expectations, that was something close to a win. "We are just beginning, and I'm looking forward to a great campaign," Pawlenty said that night. The next day, he dropped out of the race.
But here at Wonkbook, we like to look forward, not backward, and that means looking Westward to Rick Perry. The Texas governor unexpectedly racked up a respectable sixth in a straw poll he wasn't even competing in. He beat Mitt Romney by more than 100 votes. And he did all this while giving his announcement speech in South Carolina. As @NYCSouthpaw tweeted, "Rick Perry's straw came all the way from South Carolina to drink Mitt Romney's milkshake."
So who is Perry? That's what Wonkbook is about today, with a special section rounding up past profiles and current coverage of the governor. Scroll past the "Top Five" and you'll find it. The shorter version is that Perry is a credible incarnation of the conservative id. That sets him apart from Romney, who is not what conservatives see when they close their eyes and imagine themselves all grown up, and Bachmann, who is not particularly credible. Oh, and his state has weathered the recession between than just about any other large state, and he can say things like "over the last two years, 40 percent of the net new jobs created in the United States were created in Texas."
You can poke some pretty big holes in "the Texas miracle," which is in many ways a story of population growth and high oil prices rather than a story of economic policy, and some of the articles in our Perry round-up do exactly that. But let's not kid ourselves: The White House feels a chill go up its spine every time Perry utters that soundbite.
Perry's other strength in the primary -- though it might prove a weakness in the general -- is that he's quite a bit more ideological than your typical presidential candidate. In 2010, Perry published a manifesto titled "Fed Up." The book is essentially an extended argument on behalf of the primacy of the Tenth Amendment. In fact, it was also a business strategy on behalf of the Tenth Amendment. "To help bring the Tenth Amendment back to life in the twenty-first century," reads the introduction, "all of the author’s net proceeds from the sale of this book will be donated to the Foundation to support the work of the Center for Tenth Amendment Studies."
Somewhat unusually for a politician with national ambitions, Perry is willing to follow this thinking as far as it can logically take him. In a Fall 2010 interview with Newsweek's Andrew Romano, he argued that "whether it’s Social Security, whether it’s Medicaid, whether it’s Medicare," all the major government programs passed in the aftermath of the Great Depression need to be rethought and perhaps understood as flatly unconstitutional. Perry suggested devolving them to the states. Perry also sees the 17th Amendment, which empowered the people to directly elect their senators, as a misstep that unwisely weakened the role the states play in our political system and suggested he would support its repeal. In this light, Perry's widely covered musings about secession seem less like a joke and more like a trial balloon that simply didn't float anywhere.
If this is the sort of thinking that is likely to quicken the hearts of Republican primary voters, it's also the sort of thinking that will help David Axelrod sleep better at night. But either way, it makes Perry an interesting and unusual entrant into the race. So read on in Wonkbook for an introduction to the Texas governor. And check back to the blog throughout the day as Suzy Khimm, Brad Plumer, Sarah Kliff and Dylan Matthews will be contributing pieces examining Perry's budget, his economic record, his Medicaid proposals and his energy policy.
Finally, I'll be guesthosting the Martin Bashir show all week on MSNBC. It airs at 3PM Eastern, and if you're looking for yet more Perry coverage, I'll be joined today by the aforementioned Andrew Romano, alongside the Economist's Texas correspondent, Erica Grieder. Tune in!
Five in the morning
1) It looks like the 2012 primary is down to Romney, Bachmann, and Perry, report Dan Balz and Philip Rucker: "A Republican presidential campaign that has been slow to take shape suddenly snapped into focus Sunday, with an unlikely three-person top tier of former Massachusetts governor Mitt Romney, Rep. Michele Bachmann (Minn.) and the newest entry, Texas Gov. Rick Perry. After three eventful days -- beginning with Thursday’s lively debate in Ames, Iowa, and running through Perry’s formal declaration of his candidacy, Bachmann’s victory in the Ames Straw Poll and former Minnesota governor Tim Pawlenty’s decision to drop out of the race -- the Republican Party is now looking at a nomination battle that is far different from the one envisioned at the beginning of the year...Bachmann was not considered a potentially strong candidate when the year began, but her victory in Saturday’s straw poll cemented her status in the upper ranks of the GOP field."
@TheGarance tweets: "First impression on seeing Gov. Rick Perry speak for 1st time: Hard to see how he's not the GOP nominee."
2) Obama's policy team is split over additional stimulus, report Binyamin Appelbaum and Helene Cooper: "Mr. Obama’s senior adviser, David Plouffe, and his chief of staff, William M. Daley, want him to maintain a pragmatic strategy of appealing to independent voters by advocating ideas that can pass Congress, even if they may not have much economic impact. These include free trade agreements and improved patent protections for inventors. But others, including Gene Sperling, Mr. Obama’s chief economic adviser, say public anger over the debt ceiling debate has weakened Republicans and created an opening for bigger ideas like tax incentives for businesses that hire more workers, according to Congressional Democrats who share that view. Democrats are also pushing the White House to help homeowners facing foreclosure. Even if the ideas cannot pass Congress, they say, the president would gain a campaign issue by pushing for them."
@RBReich tweets: "So far, O's proposals for jump-starting the economy and jobs are policy miniatures, like Clinton's 1996 'v-chips' and 'school uniforms.'"
3) Many right-leaning policy voices think the economy needs more short-term stimulus, reports Jackie Calmes: "The boasts of Congressional Republicans about their cost-cutting victories are ringing hollow to some well-known economists, financial analysts and corporate leaders, including some Republicans, who are expressing increasing alarm over Washington’s new austerity and antitax orthodoxy...Among those calling for a mix of cuts and revenue are onetime standard-bearers of Republican economic philosophy like Martin Feldstein, an adviser to President Ronald Reagan, and Henry M. Paulson Jr., Treasury secretary to President George W. Bush, underscoring the deepening divide between party establishment figures and the Tea Party-inspired Republicans in Congress and running for the White House."
4) Jeremy Stein and Richard Clarida are likely to be Obama's new Fed picks, reports Neil Irwin: "President Obama is considering nominating two economists with backgrounds in finance — one of them a Republican — as Federal Reserve governors, according to a source familiar with the decision making. The White House is looking at Jeremy Stein, a Harvard economist, and Richard Clarida, of Columbia University and the bond investment firm Pimco, to fill two vacant slots on the seven-member Fed Board of Governors. Clarida served in George W. Bush’s Treasury Department as an assistant secretary. Stein did a brief stint at Treasury under Obama."
Read Dylan Matthews for a deeper look at Stein and Clarida: http://wapo.st/n8SCtw
5) Policymakers need to stop coddling the super-rich, writes Warren Buffett: "Since 1992, the I.R.S. has compiled data from the returns of the 400 Americans reporting the largest income...You can be sure that any payroll tax for the 400 was inconsequential compared to income. In fact, 88 of the 400 in 2008 reported no wages at all, though every one of them reported capital gains...I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get. But for those making more than $1 million -- there were 236,883 such households in 2009 -- I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more -- there were 8,274 in 2009 -- I would suggest an additional increase in rate."
Mancunian rock interlude: Wu Lyf play "Cave Song" live in Paris.
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Still to come: A primer on Rick Perry; Geithner and Bernanke are running out of options; an appeals court ruled that the individual mandate is unconstitutional; an infrastructure debate could be Congress' next major battle; Obama's behind on his Copenhagen obligations; and a baguette vending machine.
Getting to know Rick Perry
Read Perry's speech announcing his presidential campaign: "We have led Texas based on some just really pretty simple guiding principles. One is don’t spend all of the money. Two is keeping the taxes low and under control. Three is you have your regulatory climate fair and predictable. Four is reform the legal system so frivolous lawsuits don’t paralyze employers that are trying to create jobs...I was the first governor since World War II to cut general revenue spending in our state budget. We passed lawsuit reform, including just this last session a 'loser pays' law to stop the frivolous lawsuits that were happening...We’re dismayed at the injustice that nearly half of all Americans don’t even pay any income tax. And you know the liberals out there are saying that we need to pay more. We are indignant about leaders who do not listen and spend money faster than they can print it."
Watch the speech here: http://bit.ly/puDRyc
Perry sets up an interesting contrast for Obama, reports Alec MacGillis: "Texas Gov. Rick Perry’s entry into the presidential race puts into especially sharp focus the clash of visions between Republicans and President Obama over the proper role of government. In Perry and the state he has led for more than a decade, Republican voters are being offered the Platonic ideal of the GOP model for economic growth -- low taxes, scant regulation and limited public services. Texas has no income tax, ranks 46th overall for the taxes it collects per capita and has the strongest job growth in the country. The state has accounted for between 30 percent and half of the net new jobs in the country in the past two years, depending on who is counting. While Obama points to his universal health care law as a historic achievement, Texas is often cited as an example of the need for health-care reform."
He can't win, writes Kevin Drum: "Everyone looks good before they get into the race. Remember how great Tim Pawlenty was supposed to be? But just wait a few months for Perry to get beat up by his opponents, for the oppo research to kick in, for all the big profiles to start appearing, and for a gaffe or two to get some play...He's too dumb. Go ahead, call me an elitist. I'm keenly aware that Americans don't vote for presidents based on their SAT scores, but everything I've read about Perry suggests that he's a genuinely dim kind of guy...Policywise, he's too radical, even for Republicans. 'Social Security is a Ponzi scheme' goes over well with a certain segment of the tea party, but not with most of the country. Nor does most of the country want to get rid of Medicare and turn it over to the states...Despite conventional wisdom, about half of the GOP rank-and-file aren't tea party sympathizers."
Ross Douthat says nominating Perry would be like the Democrats nominating a Al Franken and Nancy Pelosi ticket: http://nyti.ms/qbqJyI
Oh yes he can, writes Erica Greider: "I see no evidence that Perry is as stupid as his critics suggest. Quite the contrary. I wouldn't seek his opinion about the new Derek Parfit but when it comes to politics, especially, he's pretty shrewd. To give one example, at the beginning of the 2010 election cycle, most pundits were expecting a serious primary contest between Perry and Kay Bailey Hutchison, the state's senior senator...Perry suggested that he wasn't even thinking much about the campaign, predicted that she didn't really want the job, and anticipated a blowout. He called it right...On the second point, that Perry is a far-right ideologue, I would again disagree. It's an comprehensible perception because he talks the talk, but his sizzle-to-steak ratio is rather high."
He allowed the execution of an innocent man, and blocked attempts to investigate it, reports David Grann: "Yesterday, the Republican governor of Texas, Rick Perry, abruptly dismissed the chairman and two members of the Texas Forensic Science Commission investigating the execution of Cameron Todd Willingham, which I wrote about last month in The New Yorker...Perry...had been governor at the time of Willingham’s execution. Before the execution, Willingham’s lawyer had asked Perry to grant a stay based on a report from Dr. Gerald Hurst, a leading fire expert, who had concluded that 'there is not a single item of physical evidence in this case which supports a finding of arson.' Willingham’s request, however, was denied...The ousted chairman, Sam Bassett, told the Houston Chronicle that he had heard from Perry’s staffers that they were 'concerned about the investigations we were conducting.'"
He intuitively gets the GOP electorate, writes Paul Burka: "TAR is one of the largest and most politically active trade associations in the Austin lobby and one of the biggest financial contributors. Its members are exactly the kind of folks a Republican candidate for governor would want in his corner...And Rick Perry has them in his corner. As I watched him speak I could appreciate the skills that he has acquired during what is now nine years in office, foremost among which is his ability to connect with his constituency. Early in his remarks, he began an anecdote by saying, 'I don’t know how many of you watch Fox News,' before adding, in a knowing tone, “but I suppose most of you do.” Later in the speech, he interrupted himself to urge the people in the audience to take out their cell phones. In an instant he transformed himself into the Aggie yell leader he once was. 'Put in that you’re fed up,' he prodded them. 'No, put in that you’re fired up. Then text it to 956-13. It comes directly to me.'"
Read the Texas Monthly's full Perry coverage: http://bit.ly/rjbQNk
He wants to dismantle Social Security and Medicare, reports Andrew Romano: "Perry hints that he would do more to limit the power of the federal government--or at least attempt to do more--than any president since Calvin Coolidge. His argument is basically that we should dismantle most of the last 75 years of national policy and relinquish even Washington’s least controversial responsibilities to the states. Perry believes, for example, that the national Social Security system, which he calls a 'failure' that 'we have been forced to accept for more than 70 years now,' should be scrapped and that each state should be allowed to create, or not create, its own pension system. 'I would suggest a legitimate conversation about let[ting] the states keep their money and implement the programs,' he says. Perry also includes Medicare in his list of programs 'the states could substantially better operate.'"
His fiscal record in Texas is extreme, writes Abby Rapoport: "Perry, along with the rest of the state, soon discovered that Texas’s budget gap--$27 billion short of what it would need to maintain its already lean services in the next biennium--was among the worst in the nation. Luckily, Texas did have a rainy day fund--over $9 billion saved up for 'economic stabilization.' Some lawmakers, including many Republicans in the state Senate, advocated using the fund to prevent or at least soften cuts to education and health care. But Perry, who had turned 'preserving the rainy day fund' into an applause line, stood firm in refusing to use it to plug holes in the budget for 2012-13. As a result, the budget cuts were draconian--initial proposals cut almost 20 percent from public schools and proposed 30 percent cuts to Medicaid providers. According to estimates from the nonpartisan state Legislative Budget Board, the initial proposal would have cost the state over 300,000 future jobs."
His "Texas miracle" comes with caveats, reports Laylan Copelin: "People moving to Texas accounted for almost half of the 4.2 million new Texans since 2000, a 20 percent increase that means more people are demanding more goods and services, a kind of self-generating economic engine. And that influx is not just people working in low-skilled jobs...Most people know of Texas' reputation for creating jobs -- the cornerstone of Perry's pitch that limited government, less regulation and low taxes are the tonic for what ails the nation. Yet almost half of the state's job growth the past two years was led by education, health care and government, the sectors of the economy that will now take a hit as federal stimulus money runs out and the Legislature's 8 percent cut in state spending translates into thousands of layoffs among state workers and teachers in the coming weeks."
The "miracle" is straight-up hogwash, writes Paul Krugman: "Does Texas job growth point the way to faster job growth in the nation as a whole? No. What Texas shows is that a state offering cheap labor and, less important, weak regulation can attract jobs from other states. I believe that the appropriate response to this insight is 'Well, duh.' The point is that arguing from this experience that depressing wages and dismantling regulation in America as a whole would create more jobs -- which is, whatever Mr. Perry may say, what Perrynomics amounts to in practice -- involves a fallacy of composition: every state can’t lure jobs away from every other state. In fact, at a national level lower wages would almost certainly lead to fewer jobs -- because they would leave working Americans even less able to cope with the overhang of debt left behind by the housing bubble, an overhang that is at the heart of our economic problem."
Both Tim Geithner and Ben Bernanke are left with few policy tools, report Zachary Goldfarb and Neil Irwin: "Geithner’s options are constrained by gridlock in Congress. Any fresh proposals to invigorate the economy would face Republican skepticism. And instead of devoting his full attention to the country’s flagging economic recovery and mounting threats from Europe, Geithner spent much of the last few months planning for the possibility Congress would not raise the federal debt limit, confronting the government with default...Bernanke, 57, meanwhile, has been pushing the Fed to take a series of steps over the past three years to spur economic growth. But he has exhausted the Fed’s usual tools -- for instance, lowering interest rates, which are now near zero -- and is facing new opposition from members of the Fed’s policymaking committee who are worried about the risk of inflation or new financial bubbles."
The supercommittee isn't all that diverse, reports Felicia Sonmez: "With House Minority Leader Nancy Pelosi’s (D-Calif.) announcement Thursday of her three appointees to the bipartisan debt
'supercommittee,' the panel’s 12-member roster is complete. It represents a broad range of ideological views, from House Republican Conference Chairman Jeb Hensarling (Tex.) on the right to Sen. John F. Kerry (D-Mass.) on the left. But the group’s membership is marked by a problem that has plagued Congress -- a lack of gender and racial diversity...Sen. Patty Murray (D-Wash.) is the only woman on the panel. House Democratic Caucus Vice Chairman Xavier Becerra (Calif.) is the group’s only Hispanic. And House Assistant Democratic Leader James E. Clyburn (S.C.) is the only African American. Neither Senate Minority Leader Mitch McConnell (R-Ky.) nor House Speaker John A. Boehner (R-Ohio) appointed any women or minorities."
World War II shows the effectiveness of both monetary and fiscal stimulus, writes Christina Romer: "Starting in the mid-1930s, Hitler’s aggression caused capital flight from Europe. People wanted to invest somewhere safer -- particularly in the United States. Under the gold standard of that time, the flight to safety caused large gold flows to America. The Treasury Department under President Franklin D. Roosevelt used that inflow to increase the money supply. The result was an aggressive monetary expansion that effectively ended deflation...The economy responded strongly...Military spending didn’t begin to rise substantially until late 1940. Once it did, fiscal policy had an expansionary impact...Taxes increased sharply, and the government took many actions to decrease private consumption, like instituting rationing and admonishing people to save. That output soared despite these factors suggests that increases in government spending had a powerful stimulative effect."
The corporate lobby's to blame for our economic mess, writes Steven Pearlstein: "Want to know who is to blame, Mr. Big Shot Chief Executive? Just look in the mirror because the culprit is staring you in the face. J’accuse, dude. J’accuse. You helped create the monsters that are rampaging through the political and economic countryside, wreaking havoc and sucking the lifeblood out of the global economy...Did you presume we wouldn’t notice that you’ve been missing in action? I can’t say I was surprised. If you’d insisted on trotting out those old canards again, blaming everything on high taxes, unions, regulatory uncertainty and the lack of free-trade treaties, you would have lost whatever shred of credibility you have left. My own bill of particulars begins right here in Washington, where over the past decade you financed and supported the growth of a radical right-wing cabal that has now taken over the Republican Party and repeatedly made a hostage of the U.S. government."
Oh, France interlude: A baguette vending machine.
An appeals court ruled the individual mandate unconstitutional, reports Sarah Kliff: "A three-judge panel of the federal appeals court based in Atlanta on Friday ruled the health-care overhaul law’s individual mandate is unconstitutional, in one of the largest legal challenges to the Obama administration’s signature achievement. This is the second federal appellate court to rule on the law; the first decision, by a Cincinnati-based court, upheld the measure. It is also the most high profile ruling, responding to a challenge to the law brought by 26 states. The law’s constitutionality is likely to be ultimately decided by the U.S. Supreme Court. In its 2-1 ruling, the panel of the Atlanta-based 11th Circuit Court of Appeals sided with a federal district court in Florida ruling that the individual mandate is not authorized under the Constitution’s Commerce clause, which allows the federal government to regulate interstate commerce."
Lobbyists are starting to target IPAB, reports N.C. Aizenman: "Even as congressional leaders launch the 'supercommittee' charged with making major inroads with the nation’s debt, Republicans and health industry lobbyists are waging a sustained campaign against a panel with notably similar goals and powers that is a centerpiece of the new health-care law. Known as the Independent Payment Advisory Board, or IPAB, it has been touted by President Obama as an essential tool for curbing Medicare spending over the long term. Comprising 15 health-care experts to be appointed by the president and confirmed by the Senate, the IPAB will have unparalleled authority to make cuts to the health insurance program for the elderly if yearly spending exceeds the law’s targets by as soon as 2015. Congress could overrule the panel, but only if it musters a super-majority in the Senate or comes up with an alternate plan that saves the same amount."
Tom Coburn's Medicare cuts would rely heavily on premium hikes, reports Walter Pincus: "Among his proposals: raising the entry age for Medicare; means-testing beneficiary payments; raising some premiums for all seniors; increasing funding for investigating fraud and abuse of both systems; and freezing for 10 years the Medicare reimbursement rates for doctors...His most controversial proposal is to raise Medicare Part B premiums for everyone by 2 percent for the next five years so that they cover 35 percent of the overall program. Coburn notes that when the measure was passed, premiums were to cover 50 percent of all costs, but they never rose above 25 percent. He projects the average cost for his increase would be $15 to $20 a month and implementation would save more than $241 billion over the next 10 years."
A fight over infrastructure funding could be Congress' next big skirmish, reports Josh Mitchell: "President Barack Obama is pressing Congress to create a new 'infrastructure bank' to finance highway and rail construction, create jobs and jump-start the stalled economy, but the proposal faces hurdles on Capitol Hill...The law authorizing the gasoline tax that provides the bulk of federal transportation money expires Sept. 30, and the tax, currently at 18.4 cents a gallon, isn't generating enough funds to keep pace with the nation's infrastructure needs anyway. But the White House, House Republicans and some Senate Democrats differ on the best way to encourage more private investment in public infrastructure. Those disagreements are likely to be swept into a broader debate over how to shrink the federal deficit that could stretch to the November 2012 elections."
A new immigration rule will make family reunification harder, reports Brian Knowlton: "A new U.S. visa rule, taking effect Monday, appears likely to substantially lengthen the amount of time that Americans living overseas must wait before bringing along their noncitizen spouses or children if they have to move home quickly for personal or professional reasons, immigration lawyers say. The U.S. immigration authorities say the new approach, which involves the processing of a visa document known as the I-130, allowing the entry of a citizen’s alien relative, will be more 'efficient and consistent and centralized'; most applicants abroad will now mail their applications to a central office in Chicago, as Americans in the United States with foreign-national relatives now do. The authorities predict a five-month maximum for processing there; applicants then have to apply to the U.S. State Department for the actual visa."
Legal momentum is shifting against gun rights advocates, reports Robert Barnes: "A funny thing has happened in the three years since gun-rights activists won their biggest victory at the Supreme Court. They’ve been on a losing streak in the lower courts. The activists found the holy grail in 2008 when the Supreme Court’s 5 to 4 decision in District of Columbia v. Heller said the Second Amendment guaranteed an individual right to own a firearm unconnected to military service...Even those challenging gun restrictions acknowledge that the courts have been unwilling to expand upon the basic right that most people agree Heller bestowed: the ability to keep a handgun in one’s home for self-defense purposes...As Maryland’s highest court, the Court of Appeals, put it: 'If the Supreme Court...meant its holding to extend beyond home possession, it will need to say so more plainly.'"
They're called illusions, Michael interlude: Magician Marco Tempest uses three iPods to talk about deception.
The administration is behind on its Copenhagen Agreement obligations on climate change, reports Juliet Eilperin: "President Obama spoke of lofty intentions to help the world reduce greenhouse gases when he addressed delegates to United Nations talks in Copenhagen in 2009...But the Obama administration is on track to fall more than $200 million short on its $1 billion pledge to help prevent the cutting and burning of tropical rain forests. Lawmakers have slashed requests on everything from promoting clean energy to helping developing nations cope with the effects of global warming. And although the United States is putting into place standards for autos and trucks that will drastically reduce emissions, its negotiators are fighting with European Union officials over their attempt to regulate U.S. airline carbon emissions."
The EPA is going forward with new ozone rules, reports Ryan Tracy: "The Environmental Protection Agency reiterated Friday that it is 'fully committed' to a health standard for smog pollution, the latest indication that the agency wants to move forward despite a lobbying blitz directed at the White House. The statement, issued along with a court filing Friday, came at a crucial time, with White House officials expected to meet next week with business trade groups to discuss the proposal. The EPA wants to revise a Bush-era standard for ozone, a primary ingredient in smog. Depending on how the administration sets the standard, hundreds of counties across the country would be required to reduce air pollution from factories within their borders. The EPA has sent its proposal to the White House, which is reviewing it before a final standard is announced."
Closing credits: Wonkbook is compiled and produced with help from Dylan Matthews and Michelle Williams.