Hoping for a Ron Paul win in Iowa

The latest polling in Iowa suggests that Ron Paul is well-positioned to make some noise in the caucuses that are occurring next week. More importantly, the peculiarities of the process in Iowa, it seems likely that Paul will even outperform his improving poll numbers.

In Iowa, voters meet in 1,784 different locations across the state. They actually debate, in these small groups, why those in attendance should vote for their guy. The main advantage that Ron Paul possesses is a devoted following of Atlas Shrugged-wielding libertarians, as demonstrated by his frequently-successful "moneybomb" fundraisers and his legion of supporters on social media sites like Reddit. The ferocity of his support is extremely useful in any contest that is usually low-turnout, such as the caucuses in Iowa. More importantly, many Paul supporters have lived and breathed his ideas and philosophies since his 2008 campaign and are able to . In a setting where debate is allowed immediately prior to caucus-goers casting their votes, Paul-ites will disproportionately swing undecided and weakly-affiliated voters to their guy.


So I'm predicting a Ron Paul victory in Iowa. It will throw the Republican race WIDE open.

Looking at the primary calendar, a Ron Paul win in Iowa would be followed by New Hampshire, where a Mitt Romney victory is almost guaranteed. Next up are primaries in the South, in South Carolina and Florida, where Newt, from neighboring Georgia, has big leads. Then they move out west to Nevada, where Romney will likely win. After that comes Colorado and Arizona, where Newt's polled well. Then a likely Romney win in Michigan, where his father was a popular governor, takes us to Super Tuesday, where anything can happen as 11 states vote.

The only way the Republican race ends quickly is if Mitt Romney runs the table. Based on how the map looks now, it is unlikely that he will do so, ruining his inevitability/electability argument, which is his strongest pull with Republican voters. A Ron Paul win, coupled with early Gingrich wins in states he holds advantages, ensures a long contest.

Which would be great for the President. The longer the primaries go, the longer Obama's eventual opponent will have to cater to the Republican Party base. Unlike the 2008 Democratic contest, where Obama and Hillary Clinton got loads of free press taking not-over-the-top-liberal positions, the Republicans will be forced to take hard-right positions for months. Obama will have millions upon millions of dollars to run a general campaign from the beginning, claiming the center while Republicans fight with each other for the base.

Iowa up for grabs

(note: apologies for not posting for 2 weeks. Started my new job w/ Akron Children's)

We're now 12 days away from the Iowa caucuses. Here's a summary of all the polling in the state since April. The lead has gone from Romney, to Bachmann, to Perry, back to Romney for a couple days, then to Cain, then Gingrich, now Ron Paul.

The prospect of a Paul win has been scaring the hell out of the Republican establishment, with the Iowa governor advising voters in other states to ignore the result if Paul wins. And he very well might pull it off, given his current lead in the polls and the strength and dedication of his organization. A major factor that's been holding back his campaign is a lack of media coverage. A win in Iowa would change that.

But a win is far from a certainty. As we saw after Newt Gingrich's rise, the knives will come out against whoever the frontrunner is. And, at least among the Republican electorate, Paul is extremely vulnerable to attacks. While voters would respect his economic views, his non-interventionist foreign policy is diametrically opposed to the traditional Republican approach. The other candidates' campaigns, and their super-PAC, will likely spend much of the next 12 days exploiting this vulnerability.

So I don't have a fucking clue who's going to finish anywhere from 1st-6th; pretty sure Huntsman will be 7th, but that's it. I think it's unlikely that Bachmann, Perry or Santorum would win it all, but any of them could finish a strong 2nd. With Romney's big New Hampshire lead, the result there almost certainly won't be "news", so the Iowa winner will likely get an even bigger boost than normal.

While I still think Romney wins the nomination, the shape the race will take is very much up in the air.

"Freezing government spending" not an easy fix

Sen. Jim DeMint (R-SC) is on CNN right now. He advocated a budget plan which would not touch Social Security or Medicare and would not raise taxes. It would accomplish this by freezing federal spending at its current level for 10 years. A similar plan, called the Penny Plan, which would actually reduce spending by 1% each year for the next six, has been proposed by Rep. Connie Mack (R-FL) and supported by Sen. Rand Paul (R-KY).

Sounds easy, right? Just keep things where they are (or cut a penny), and presto, it's all fixed! No sweat.

This might indeed be a relatively easy, were the United States demographically-stable. Unfortunately, ours is an aging population. In the midst of either DeMint's or Mack's plan, millions of Baby Boomers will retire, further swelling the Medicare and Social Security rolls and of course leading to a huge increase in government spending. Were one of these "freeze" plans in place, there would have to be dramatic cuts in discretionary spending to stay under the caps these Republicans would impose.

Rep. Mack and Sen. DeMint are of course well within their rights to present these cuts. But it is dishonest to present these cuts as easy and painless.

As discussed in my very first post of this cycle, most voters are woefully ignorant about the federal budget. When people don't know anything, it's easy to say "let's just freeze spending" and have voters think "Yeah! The government spends too much already! It would be easy to just not grow for a few years". With our clueless electorate, it just might work.

Cain out; good news for Newt

Herman Cain suspended his campaign today. He said "suspended" so he can continue to raise money, but he's done. He says he will endorse a candidate "in the near future". Based on his recent appearance with Newt Gingrich at a "debate", as well as Newt's current status as frontrunner, makes Newt most likely to pick up a few more percentage points as a result of today's announcement.

He'll also become more likely to beat Romney. Cain being out of the running means the "anti-Romney" vote is split one fewer way, meaning Romney's amazingly-stable 20-25% in the polls less likely to hold up.

Bachmann finished?

Please for the love of God tell me that Michele Bachmann's support in the polls will vanish after today. She said that, in response to the British embassy in Iran being raided by "students" a few days ago, she would close our embassy in Iran. The only problem is that we haven't had an embassy in Iran since before I was born.

So seriously, fuck Michele Bachmann. This episode clearly demonstrates that she is willing to completely talk out of her ass on important matters. This wasn't a gaffe or a blunder. It was taking a policy position without having the slightest clue about the facts of the policy. It is indefensible, and it shows she has no place in public discourse.

Newt's K-Street history

While the Tea Party and the Occupy Wall Street movements disagree on many things, they both (early on, at least, in the case of the Tea Party) decried the rise of "crony capitalism". They recognized that the huge lobbying checks written to those in power cause huge, unfair distortions in the market, disproportionately helping the donors at the expense of the rest of us. The Tea Party in particular has been rabidly "anti-Washington". One would think that lobbyists and Washington insiders would be immensely unpopular with both crowds. The Tea Party's recent embrace of one Newton Leroy Gingrich demonstrates that this formerly-key principle of the movement has been abandoned, as Gingrich is entirely a creature of K Street, lobbying capital of the universe.

After Gingrich's resignation as Speaker, he spent the next decade making money off of his name and his connections in Washington. He set up numerous for-profit organizations to this end. These organizations are all located on K Street (as Rachel Maddow discussed yesterday; jump to 5:30 for the relevant section). He received at least $37 million just from health care organizations. While he never officially registered as a lobbyist, it's safe to assume that they weren't just paying him tens of millions for his perspective as a historian.

The Tea Party would lose all of its credibility if Newt, a literal creature of K Street, were to become the nominee. It would mark the completion of the Republican establishment's mission to subsume the Tea Party movement.

Romney will be the nominee

At tonight's CNBC debate, Rick Perry likely torpedoed both his own campaign and Herman Cain's. As a result, I will predict that by December 1 Newt Gingrich will be at least 2nd in the polls, if not 1st. More importantly, I would now project Mitt Romney to be the near-certain nominee.

Perry committed a huge blunder in the debate. He was attempting to discuss his plans to eliminate three cabinet departments, then couldn't name which three. He got Commerce and Education, but forgot the Energy Department.

If Romney, Gingrich, Huntsman, Santorum or Paul would have committed this mistake, it might not have been so bad for their chances. For Perry, however, the gaffe played into an already-established narrative that he's, to be blunt, too dumb to be President. This reinforcing nature of the gaffe is what makes it so fatal, just like Howard Dean's "I have a scream" moment killed him because it reinforced that he was unstable/angry or why Dan Quayle's "potatoe" gaffe defined his legacy.

It is, frankly, unacceptable for a Presidential candidate to not be able to rattle off every cabinet department, or at least the ones he plans to eliminate. Perry should have been able to catch himself, start a list of each department and arrive at the right one.

This gaffe will undoubtedly be run again and again on the news, and I think we can all predict with a fair degree of certainty what Saturday Night Live will open with this week. I predict that this will lead to a discussion of the intellectual requirements to be President, and that this (along with the sexual harassment stuff) will end Cain's reign at/near the top.

So why Gingrich? Truly, it's largely a process of elimination. Perry, Cain and Bachmann have already had their shot (and fail the intelligence test), Paul's too out there, Santorum and Huntsman too unknown, and Romney's Romney, so it's Gingrich's turn. He certainly meets the intelligence requirement. He's a true conservative, with 1994 Contract with America credentials. Perry and Cain are going down, and voters won't settle on Romney yet, so it's Newt's turn.

Does Newt have a chance of being the nominee? I truly doubt it. With the intensified attention that will come with improving in the polls, people will remember about his "right-wing social engineering" remark, his serial affairs, his ethics issues that led to reprimand by the House, etc. But for now, when poll respondents only remember the 1994 revolution and his recent debate performances, he'll have a rise.

But after his inevitable fall, we'll be left with Romney. I think Santorum's social stances are too extreme even for the modern Republican Party, and he's just not that likeable. Huntsman is too moderate/reasonable. So they're left with Romney. As previously discussed, I'm OK with that.

Perry's tax plan more viable than 9-9-9

The biggest non-sex-related* development in the Republican race in the last two debate-free weeks was Rick Perry's unveiling of his flat tax plan (.pdf). The main takeaway is that, like Herman Cain's 9-9-9 plan, it hugely decreases taxes on the wealthy. More importantly, in terms of politics, it represents a much more politically-feasible route to such giveaways than the Cain plan.

First, the numbers. Perry proposes to offer every taxpayer a choice between the current system and a flat tax of 20%. It also eliminates taxes on capital gains, the estate tax, increases personal exemptions to $12,500 per person in the household, and greatly reduces corporate taxes on profits earned overseas. It does not change the payroll tax.

Now, the math. So far as I can tell, the plan eliminates the Earned Income Tax Credit, which as previously discussed would be a disaster for the working poor. In a sane world, proposing to end an effective tool to help the poor which was instituted by Ronald Reagan would carry a political cost. In today's Republican Party, however, the problem is apparently the 47% of Americans who only pay sales, payroll, state/local and property taxes but don't pay federal income taxes, so screwing the poor is accepted party doctrine.

Where Perry's plan is politically superior to Cain's is its effects on the middle class. As previously discussed, Cain's plan would raise taxes on the average family of 4 by about $3,000 a year. For the vast majority (84%) of taxpayers, they could do the math and find that they would pay more under 9-9-9. Regardless of the arguments one might make for a tax proposal, if a vast majority of voters find it hurts them, it's probably not going to do very well at the end of the day.

Under Perry's plan, our family of 4 making $50,000 sees its federal income tax burden fall to $0, thanks to the increased personal exemption: $50,000 - 4 x $12,500 = 0 taxable income. Families making more than $50,000, their tax bill goes down under Perry's plan, except for a narrow band of people whose income is right around where the current income tax rate goes from 15% to 25%, which is $69,000 after deductions/exemptions. These people wouldn't actually see their taxes go up either, as they're allowed to choose to remain with the current plan.

For the rich, whose current income tax rate is 35%, 20% is a pretty great deal, particularly when they get to keep the mortgage interest deduction. The deduction actually phases out for incomes over $500,000, but the income tax rate savings more than make up for the phase-out. The wealthy also make a much larger percentage of their income from capital gains, the taxes on which drop from 15% to 0% under Perry's plan. They also no longer have to pay estate taxes, which only applies to estates of $5 million or more and currently tops out at 35%.

Cain's 9-9-9 plan at least attempts to be revenue-neutral (i.e., bring in as much money as the current code). Perry's plan would bring in much less revenue, exploding the deficit. Mainstream Republicans are under the impression that tax cuts for the rich are inherently revenue-neutral. They base this on the Laffer Curve, which states that there exists a level of taxation above which tax revenue will actually go down. While such a level exists, it's above the level of taxation where we currently are, so lowering tax rates will lower revenue, despite what Perry and others would have us believe.

Perry's plan would be terrible for the country, as the deficit would grow even more and force huge cuts in government programs. But, because taxes will go down on the middle class and way, way down for the rich, it is more politically palatable to voters, particularly those who put us at the wrong point on the Laffer Curve. By introducing the plan, Perry has positioned himself to potentially capitalize on an eventual Cain demise.

(*: I don't really care to comment on the particulars of the allegations against Cain. If you're interested in the story, www.politico.com has been the best source)

Maybe Herman Cain's just clueless

Herman Cain's been getting a lot of shit from me recently. I think it's mostly justified, as his policies would be terrible for the nation. But it's becoming increasingly clear the more I hear him in interviews and debates that the man just has no idea what he's talking about. A sampling;

-His previously-discussed ignorance of the Palestinian Right of Return, a fairly major element in the Israel-Palestine conflict.
-His ignorance of neoconservatism, the dominant foreign policy idea in the Republican Party in the past 15 years.
-His proud ignorance of details of foreign countries and foreign leaders; "Uzbeki-beki-beki-beki-stan-stan".
-Most damning are his fumbles of questions on abortion, a topic he should be strong on given the prominent role it played in his 2004 run for Senate. In an interview with John Stossel about 3 months ago, Cain gives completely contradictory answers in back to back sentences. The clip really is worth watching; it's just over a minute, and the other guest's response to Cain's literally-jaw-dropping answer is worth the price of admission.
-On Meet the Press, he said he did not support abortion under any circumstances but then said abortion in the case of a threat to the life of the mother would have to be made by the family. Not as self-contradictory as the Stossel interview, but not crystal clear either.
-He further muddied the waters on his abortion stance in an interview with Piers Morgan, where he again seemed to indicate it wasn't the government's role to make the choice on abortion.

What concerns me most about the repeated poor responses on abortion is that neither the candidate nor his team thought to tighten up the answers. After the Stossel interview months ago, an intelligent/savvy politician would have spent some time to figure out a way to clearly convey his stance on this issue, which is a particularly important one in Iowa and throughout a Republican primary.

Republican voters should be hopeful that Cain's campaign mirrors that of Ross Perot. By making tax reform a central issue in his campaign, he is influencing the debate, just like Perot did in '92 on deficit and spending issues. But should Cain's lead in the polls carry him to the nomination, I'm supremely confident of four more years for Obama, and likely big gains in Congress as well.

Herman Cain thinks he's helping poor people

Today's Herman Cain news is that he says "if you are at or below the poverty level, your plan isn't 9-9-9. It's 9-0-9." Then, being the fucking asshole that he is, he follows that up with "Say Amen, y'all", as if to put an exclamation point on the tremendous gift he's given the poor among us. The middle number is the income tax, so people in poverty are excused from that portion.

So, let's fire up the arithmetic machine and see what effect 9-9-9 would have on the average family of 4 living at the poverty line. For a family of four, the poverty line is at $22,050, so let's look at a family making $22,000 a year. Sneak preview, they will be $6,878* worse off should 9-9-9 (which is 9-0-9 for them) come to pass:

-McDonald's has to pay 7.65% in payroll taxes, so they have to spend $23,683 to hire a worker with a $22,000 salary, with the extra $1,683 going to Uncle Sam
-The family also must pay 7.65% in payroll taxes, so there goes another $1,683
-The standard deduction for a married couple is $11,400, dropping their taxable income to $10,600
-The personal exemption ($3,650 per family member) drops their taxable income to $0
-As you might expect, this drops their owed income tax to $0
-Not only do they not owe any income taxes, they get additional, refundable credits, including:

-Earned Income Tax Credit (.pdf, Page 46): For a family of 4 making $22,000, they would get a tax credit of $4,917. This credit is refundable (i.e., they get a check from the government for $4,917 every year
-Child Tax Credit: Under current law, after the stimulus peters out, our family would get a $1,417 refundable tax credit (it'd be $2,000 today)

So the family's total tax bill would be $1,683 in payroll taxes, plus $1,683 that their employer pays. They get a credit of $6,334. So their personal tax bill is currently a net credit of $4,651, or $2,968 when you include the employer's portion, which you should.

Now President Cain institutes 9-9-9 (or 9-0-9 for the poor). In the process, he completely eliminates the Earned Income Tax Credit and the Child Tax Credit. Here's the math:

-McDonald's is still willing to spend $23,683 to employ the family's breadwinner ($22,000 + employer's contribution toward Social Security and Medicare)
-Under Cain's plan, McDonald's has to pay a 9% tax on that money, reducing the gross pay of the family to $21,551, since 9% is more than 7.65%, with the other $2,132 going to Uncle Sam.
-The family will, according to the Consumer Expenditure Survey, be expected to spend even more than their income (i.e., go into debt) every year. Let's assume they just spend their income.
-If you were to spend $21,551 including a 9% sales tax, you'd spend $19,772 on stuff and $1,779 in taxes.

So our family pays $1,779 in direct taxes, or $3,910 if you include the employer's portion, which you should.

Herman Cain's 9-9-9 plan, even with the 9-0-9 change, changes the tax bill for a family in povery from a $2,968 credit to a $3,910 liability. This is $6,878 less that a family already IN POVERTY would have every year if Cain's plan becomes the law of the land.

Say Amen to that, you fucking asshole

(*an earlier version of these calculations used a wrong poverty threshold, which was taken from Herman Cain's website (.pdf, table 6). Serves me right for taking numbers from a source I spend the entire post attempting to rip to shreds.)