Category Archives: U.S. Congress

Castro’s death moves Cuba farther into the market for Arkansas rice, ideas

Business, Business and economics, Politics, State government, U.S. Congress

By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

Fidel Castro is dead. How does that affect people in Arkansas? Maybe a lot, especially if they work in the rice industry or are elected to represent people who do.

Cuba’s 11 million people import 400,000 tons of rice each year, mostly from Vietnam, which means the rice arrives after a long boat ride from a country on the other side of the globe. Rep. Rick Crawford’s eastern Arkansas 1st District includes half of America’s rice acreage, so it’s understandable that his reaction to Castro’s death focused on the future, not the past.

“Fidel Castro’s death is an opportunity for America to end its ineffective policies so we can influence the future direction of that nation,” he tweeted, then added, “Through my own visits to Cuba I’ve seen people ready for change. With Fidel dead, America needs to help lead Cuba toward a better future.”

Crawford for some time has been an outspoken supporter of prying open Cuba’s markets, which have been largely closed since Oct. 19, 1960, because of the American trade embargo. He’s pushed legislation to allow Cubans to purchase agricultural products on credit rather than the currently required cash, of which Cubans don’t have much, so they could replace that Vietnamese rice with fresher, cheaper rice grown here.

Two other Arkansas officials who represent those same eastern Arkansas agricultural producers (and voters) took a similar forward-looking approach. Sen. John Boozman tweeted, “I hope the death of Fidel Castro marks a new beginning for an American-Cuban partnership and brings light to democracy in #Cuba.” Speaking to reporters, Gov. Asa Hutchinson called Castro’s death a “moment that I believe needs to be seized.”

President-elect Donald Trump said he would terminate the current opening with Cuba initiated by President Obama unless Cuba makes a better deal for its own people, for Cuban-Americans, and for the United States. That threat may have just been the country’s new dealmaker-in-chief doing what he does, which is start the negotiating process by taking a hard line and then moving away from it.

In response, the governor said Trump’s stance is “understandable,” but while change must be accompanied by enhanced freedom for Cubans, “I hope that we do not go back to the simple, straightforward, rigid embargo that we have tried for 50-plus years.”

Hutchinson and Boozman represent the state while Crawford represents his district, so their remarks were meant for those audiences. Sen. Tom Cotton has an additional audience – a national one. It includes many people who, like him, have argued that this thawing of relations between America and Cuba will only help the Castro regime. Cotton released a two-sentence comment focused on the past, except for one assertion of Castro’s future: “Fidel Castro created hell on earth for the Cuban people. He will now become intimately familiar with what he wrought.”

Count me with Crawford, Boozman and Hutchinson on this one. The American people are supposed to be practical-minded problem-solvers who, when something doesn’t work, try something else. We’re the country where Thomas Edison invented the light bulb through experimentation, failure and more experimentation. And yet when it comes to its Cuba policy, we’ve stubbornly tried the same thing for 56 years that clearly didn’t work. Only old age and death, not the American trade embargo, removed Castro from power. Now his brother, Raul, remains in charge. He’s 85, by the way.

Pry open the doors to Cuba, let in a little freedom, and see what happens. Arkansas rice will be more than just an item on the dinner table. It will be a taste of what a free market economy offers. As Cuba opens itself to visitors from Arkansas and elsewhere, it will not be able to choke off ideas that are contrary to its glorious revolution. Fifty-five years after the failed Bay of Pigs invasion, an army of businessmen, tourists and missionaries will descend on an island 90 miles from Florida, accomplishing what the embargo never could.

Somebody’s going to sell rice to the Cubans, and when they do they’ll also export their ideas and way of life. Currently, that exporter is Vietnam, another repressive communist regime. I think Arkansas offers a better deal.

The campaign that wasn’t

Elections, Politics, U.S. Congress

By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

This year’s U.S. Senate campaign would seem to fit neatly into a junior high textbook description of how the country’s two-plus party system operates. The incumbent, Sen. John Boozman, is a well-liked, mild-mannered Republican. He’s older and wiser and not one to rock the boat, which is a good or bad thing, depending on a voter’s perspective. He’s being challenged by a young, energetic Democrat, Conner Eldridge, who hasn’t previously run for elective office and has things he wants to do. Adding to the interest is the Libertarian candidate, Frank Gilbert, who makes an eloquent case for views not held by the majority of voters.

It’s not hard to imagine how that junior high textbook would describe such a campaign: as a contest of ideas where the candidates discuss the issues and the voters choose the best one.

Instead, it’s been the campaign that wasn’t. Most people’s attention, including mine, has been riveted on The Hillary and Donald Show at the top of the ticket. There have been times when I couldn’t take my eyes off that circus even when I wanted to.

Meanwhile, Arkansas is now such a red state that Boozman has been able to rely on his party label and the advantages of incumbency. Plus, maybe voters just think he has done a good enough job. You may not agree with him, but you can’t help but like him. So it’s no surprise that, in a recent Talk Business & Politics/Hendrix College poll, Boozman was leading his two opponents, 52-34-4.

With so much in his favor, Boozman adopted a simple strategy: Ignore Eldridge. Eldridge challenged him to a series of debates, but Boozman refused to take the bait, and, besides, it wouldn’t have made much of a difference. They debated once on AETN, and it didn’t fundamentally alter the race. Trying to break through, or at least get under Boozman’s skin, Eldridge drove a truck through the state with two lecterns to illustrate his charge that Boozman was avoiding him and debated Gilbert several times with an extra lectern supposedly meant for Boozman.

In other words, Boozman has behaved as anyone would behave with a big lead: by playing it safe and running out the clock. Eldridge has done what he could to change the game’s direction, but he never could raise the money to mount a challenge or gain momentum or just get some attention. Gilbert has shared his views with whoever would listen.

The campaign never could be about the issues, so then it became about non-issues. Eldridge has tried to make something of Boozman’s international travels, which would seem to be part of the job of being a senator, and has said Boozman hasn’t spent enough time in the district. He criticized Boozman for refusing to disavow Donald Trump, which wasn’t destined to have much success in a state where more Arkansans say they are voting for Trump than for Boozman. Boozman’s campaign, when it hasn’t pretended Eldridge doesn’t exist, ripped page one out of the GOP playbook and tied Eldridge to President Obama, who appointed Eldridge as a U.S. attorney. The issue has not been whether Eldridge had served well but that he had served, period.

Boozman is going to win. Regardless, a U.S. Senate campaign, especially one with three textbook candidates, ought to be a bigger deal to all of us than this, even when The Hillary and Donald Show is on.

A senator is an important official. There are only 100 of them, each state gets only two, they serve six years, and they aren’t term-limited. Sen. Dale Bumpers was in office 24 years – three times longer than any president except President Franklin Delano Roosevelt. And senators make important decisions, including ratifying treaties and confirming Supreme Court justices, according to the textbooks. A single senator taking advantage of the rules can just about grind Congress to a halt. But for all the reasons listed above, this year’s race just hasn’t reflected that importance.

The next Senate campaign in Arkansas is scheduled for 2020 – another presidential election year. It’s hard to imagine that one being as crazy as this one, but then, it was hard to imagine this one. Maybe that Senate race will get more attention. Sen. Tom Cotton, who arouses passion on both sides, will be on the ballot then – at least as a Senate candidate, and maybe more.

Related: How Conner Eldridge thinks he can win.
A husband first, and then a candidate.

Spend less to tax less

Politics, State government, U.S. Congress

Lt. Governor Tim Griffin says tightening state government's finances is the necessary first step to cutting taxes.
Lt. Governor Tim Griffin says tightening state government’s finances is the necessary first step to cutting taxes.
By Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

Lt. Governor Tim Griffin is pushing an idea: Cut spending first and then cut taxes. It’s so crazy it just might work, which is why he wants to try it in Arkansas and why, hopefully, someone will try it in Washington, D.C.

Griffin, who has announced he is running for re-election in 2018, points to the state’s ranking in the high 40s in many areas. Sitting across the table from me in a Little Rock coffee shop, he said the state can’t get to the top by tweaking. “Bold is the only option” he said.

A top priority would be the state’s income tax. It ranks in the middle of the country, according to the Tax Foundation, but the top rate, 6.9 percent, is tied for 14th highest and hits all filers with incomes of $35,099, which is not exactly Walton money.

Arkansas’ top rate is higher than all its surrounding states, including Texas, which has no income tax. Thus the state is at a competitive disadvantage, which is one reason Gov. Asa Hutchinson wants to cut income taxes next year, as was done in 2015. Hutchinson probably will propose relatively modest cuts. Griffin wants to go big.

The problem, Griffin says, is that elected officials who talk about tax cuts run into a brick wall erected by those who argue that the state won’t have enough revenues to meet critical needs. To get past that, the state must make reforms to meet those needs with fewer dollars.

The simplest way of looking at how the state spends money is its general revenue budget, which in fiscal year 2017 is $5.3 billion. Griffin says making government 10 percent more efficient, which is really doable, would free up $530 million – enough for a substantial income tax cut along with increased spending in other areas, such as highways.

Griffin is talking about not just cutting waste, fraud and abuse, but instead undertaking systemic reforms of state agencies, many of which he says were designed before the remote control was invented. He says if a boat is designed to require six rowers, it does no good to try to propel it with four. Instead, change the boat so it only needs four.

“Make smart government your focus. … If you just cut, you still have the same inefficient systems in place that require the inefficient resources,” he said.

Last year, Griffin undertook a review of the state’s massive Department of Human Services, which takes care of a lot of the state’s neediest residents and is a mess. Its new director, Cindy Gillespie, now is reorganizing it. Griffin wants to see the same effort undertaken across state government. He started by cutting one position from his three-person office.

Griffin says state government has a moral obligation to spend taxpayer dollars efficiently. He says Arkansas must be competitive with other states. And, it must prepare for the day when the debt-ridden federal government starts sending less money to Arkansas.

And that brings us to Washington, D.C., where Republicans adhere to two entrenched beliefs that are very different from what Griffin, a former Republican congressman, is describing. One, “starve the beast,” says government can be shrunk by depriving it of money through tax cuts. The other belief is that tax cuts generate so much economic growth that spending cuts aren’t really necessary. Donald Trump’s plan reflects that belief – tax cuts without spending cuts – which is why the Committee for a Responsible Federal Budget says it could add $11.5 trillion to the national debt.

Republicans in Washington over the past few decades have pledged allegiance to those two beliefs, enthusiastically cutting taxes without insisting on cutting government. Democrats shook hands on that bargain because they like to spend without taxing, too. The result has been the national debt ballooning from $1 trillion in 1981 to $19.4 trillion today. Unfortunately, money did not grow on trees, and the beast wasn’t starved because it could reach across the table into the future and steal food from the plates of our children and grandchildren.

All of this should make perfect sense to those of us who live on a budget. If you are struggling to make ends meet, you look for waste and inefficiency in your spending first, and certainly before you switch to a lower-paying job.

It makes sense in government, too, where being smart should be the focus, and where the state of Arkansas is a good place to start.

Related: If Trump or Clinton succeed? More debt.

Fiddling around, ignoring problems

Debt and deficits, Politics, U.S. Congress

Uncle Sam hangs on for webBy Steve Brawner
© 2016 by Steve Brawner Communications, Inc.

You know the story about Nero fiddling while Rome burned? It didn’t actually happen, but it illustrates a point about leaders crazily ignoring a problem.

These days, no illustration is needed. The government’s largest programs, Social Security and Medicare, are not burning up, but their problems are being ignored.

On Wednesday, the Social Security trustees and Medicare trustees each released their annual reports.

Social Security’s trustees wrote that the trust fund that supposedly finances the program – but actually has been raided to pay for other programs and then filled with IOUs – will be empty by 2034. That’s when today’s 49-year-olds (I’m 47) reach the normal retirement age. When that happens, benefits for all recipients, including 85-year-olds, theoretically would be cut 21 percent.

But of course that probably wouldn’t happen. The American people wouldn’t stand for it, and too many seniors vote. If tomorrow’s elected officials play the fiddle as well as today’s do (and they will probably be some of the same people), they’ll transfer money from the rest of the budget to Social Security and add to the national debt. As of June 21, that debt is $19,265,744,770,778.65, or more than $59,000 for every American.

Medicare’s due date is approaching faster. The trustees say the trust fund that pays for hospitals will be depleted by 2028, which is two years sooner than was projected last year. When the assets are depleted, revenues would cover 87 percent of the costs. Today, the program covers 55.3 million people.

All of this is occurring in the context of huge budget challenges. The government will already spend $534 billion more this year than it will collect, according to the Congressional Budget Office. Social Security, Medicare and interest on the debt already comprise 45 percent of the federal budget. Social Security and Medicare are growing, and the CBO says interest costs will rise from 6 percent of the budget this year to 13 percent by 2026.

In other words, if you neither touch Social Security and Medicare nor raise taxes, everything else, including defense, has to be cut quite a bit.

The American democratic experiment has faced bigger challenges than this one: creating a Constitution, ending slavery, reconstructing the union, winning World War II. Social Security and Medicare previously have faced insolvency, but at various times policymakers have figured out ways to push the due dates into the future. Social Security doesn’t require some Einsteinian policy fix – just spend less and/or collect more tax revenues. Medicare is harder because it’s based on paying into a health care system that keeps getting more costly, but it can be done.

Still, solving these problems is difficult because of changing demographics – we’re getting older and living longer – and because Americans now expect expensive government services for which they’re unwilling to pay the full cost. They believe the money can be found elsewhere, and some can be found, but not enough.

So elected officials not only must put down their fiddles, but they must also come down into the city and convince a majority of people to help put out a fire that, for now, is hard to see. All the while, they must overcome the many special interests who want to feed the fire.

Somebody must lead. Unfortunately, that probably won’t happen this election year. Sen. Bernie Sanders has led the Democratic Party, including President Obama and Hillary Clinton, to calling for increasing Social Security benefits. Clinton says she’ll pay for her increases by raising taxes on the wealthy – but remember, she gets a lot of money from wealthy people. The Republican nominee, Donald Trump, says there will be no need for changing the programs because America will be so rich because of his better trade deals and Mexico-built wall.

If it were up to me, we’d raise Social Security’s retirement age, reduce or end benefits for the wealthy, increase payments to older and infirm recipients, and increase the payroll tax. I’m not sure what to do about Medicare. I’d also cut other things and slowly pay back the money we’ve already spent.

But for now, I’ve lost that debate in every direction. Americans don’t want to cut spending, and they don’t want to raise any taxes.

So at this point, I really don’t care which direction we go. Just stop increasing the debt we’re passing on to my kids. They’re going to have enough on their hands taking care of me someday.

Related: Red ink rising.