“The Biden administration, perhaps worried about the political toll that rising food prices could extract in next year’s midterms, announced plans earlier this month to offer up to $500 million in loan guarantees to beef producers. That’s on top of $500 million approved as part of the $1.9 trillion American Rescue Plan that was supposed to “expand processing capacity and increase competition in meat and poultry” industries, according to the U.S. Department of Agriculture.
The second prong of the White House’s plans seems to involve shaming meat-processing companies. “Just four large conglomerates control the majority of the market for each of these three products (beef, pork, and poultry), and the data show that these companies have been raising prices while generating record profits during the pandemic,” Brian Deese, director of the White House’s National Economic Council, said during a press briefing last Friday, the Detroit Free Press reports.
Taken together, the White House’s approach to high meat prices can be summarized as an argument for greater government subsidies based on the idea that stimulating more competition in the meat-packing industry will expand supply and reduce bottlenecks.
But, as David Frum details in The Atlantic today, there are some good reasons to be skeptical of this argument. For starters, it takes about $200 million (and several months, if not longer) to build a single new meat-processing plant. That means the Biden administration’s new loan programs will not purchase much additional capacity, and whatever gains are made will not happen immediately. Even if the plan is successful, smaller producers will likely need ongoing support beyond the initial loans—if there was a market for more, smaller meat processors, the private sector would be investing in them already.
“There’s a real risk,” writes Frum, “that the initial commitment of $500 million in aid and loan guarantees to small packers will expand into continuing intervention in the marketplace to keep smaller competitors in business in the face of the higher efficiency and lower prices of the big packers.””
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“Offering $500 million in loan guarantees to anyone who wants to build a new meat-processing plant isn’t going to address the supply chain problems at the existing plants or end the Western drought.
Higher prices, while politically difficult for the Biden administration, will send signals up the supply chain that result in more workers being hired and more cows being raised.”
“The federal government hasn’t fully paid for its normal, run-of-the-mill spending in a single year since 2001. If you believe the projections of the Congressional Budget Office (CBO), there is not a single year in the next 30 (the longest length of time for which the office projects spending and revenue) in which the budget will balance. Despite that, lawmakers from both parties continue to peddle this line whenever they want to make big policy changes. Democrats promised that Obamacare would be revenue-neutral. It hasn’t been. Republicans promised the Trump tax cuts would pay for themselves. They didn’t.
Now it’s the Democrats’ turn to play this game, and President Joe Biden has dutifully stepped up to the plate. Speaking Friday about the combination infrastructure package and budget reconciliation bills that the House may vote on sometime this week, the president declared that anyone worried about the latter legislation’s $3.5 trillion price tag should calm down.
“We talk about price tags. It is zero price tag on the debt,” Biden said. “We are going to pay for everything we spend.””
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“Democrats are proposing to pay for their $3.5 trillion reconciliation package with about $2.3 trillion of tax increases and $700 billion in savings from changing how Medicare and Medicaid purchase pharmaceutical drugs. The rest is written off as being paid for with future economic growth—the idea being that increases in government spending will cause more hiring and greater economic activity, which will cause future tax collections to be higher than projected.
It’s a little bit like saying that your drinking habit can pay for itself, as Reason’s Peter Suderman has explained.
The math doesn’t add up. In order to achieve the amount of “dynamic scoring” necessary to offset that last $600 billion or so of new spending, the reconciliation bill would have to boost America’s economic output by about 3.5 percent by 2031. That’s far in excess of what every independent assessment of the package says it will do. In fact, at least one assessment of the package says the bill’s tax increases and borrowing will more than cancel out the benefits of heightened spending, dragging growth lower.
The debate over those projections is pretty esoteric. But regardless of which forecast you believe, there’s no getting around the fact that some of the lawmakers now championing the magic of “dynamic scoring” used to be quite skeptical of it. Democrats on the House Ways and Means Committee—the very committee that put together the details of the reconciliation bill over the past few weeks—blasted Republicans for relying on “dynamic scoring” to make it look like the Trump tax cuts would balance over the long-term. In the Senate, meanwhile, Budget Committee Chairman Bernie Sanders (I–Vt.) used to call dynamic scoring a “gimmick” meant to “conceal” the real cost of legislation. Now, he’s fine with using it because Republicans did it first.
If hypocrisy could be taxed, maybe we’d be able to balance the budget.”
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“That isn’t the only dubious assumption behind Biden’s promise that everything will be fully paid for. It doesn’t fully account for the long-term budget impact of the newly expanded child tax credit, which allows Congress to claim $700 billion in “savings” that are unlikely to materialize. The reconciliation bill also calls for boosting IRS enforcement in the hopes of generating $239 billion in revenue from taxes that are currently going uncollected. That is likely an overestimation, as the CBO says the provisions would generate no more than $120 billion from increased tax compliance.”
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“If the bill is truly paid for, Democrats in Congress should prove as much by asking the CBO and the Joint Committee on Taxation to provide a detailed analysis of the “dynamic scoring” promises contained in the reconciliation bill. Without that, argues Chris Edwards, director of tax policy studies at the libertarian Cato Institute, Democrats’ claims that higher spending will generate sufficient economic growth have no hard backup.
“There is no magic money tree in Washington,” Edwards says. “Rather, taxpayers will ultimately pay for the spending through current tax increases, debt and future tax increases, and inflation.””
“A key climate policy designed to phase out fossil fuels will likely be cut from Democrats’ upcoming reconciliation package due to opposition from Sen. Joe Manchin (D-WV), who has reportedly refused to back the measure as negotiations over the budget bill continue.
According to the New York Times’s Coral Davenport, who first reported the news on Friday, Manchin, who chairs the Senate Energy and Natural Resources Committee, will not support the sweeping clean electricity program widely seen as the centerpiece of the bill’s climate plan.
The $150 billion program — officially known as the Clean Electricity Performance Program, or CEPP — would reward energy suppliers who switch from fossil fuels like coal and natural gas to clean power sources like solar, wind, and nuclear power, which already make up about 40 percent of the industry, and fine those who do not.
Experts believe the program is the most effective way to slash US carbon emissions significantly enough to prevent the global temperature from rising by 1.5 degrees Celsius, a threshold which would have drastic consequences for the planet if exceeded.”
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“Manchin’s home state of West Virginia is one of the largest producers of coal in the US, and Manchin himself benefits financially from the coal industry.
Manchin’s spokesperson, Sam Runyon, told the New York Times that Manchin opposed the CEPP because he couldn’t support “using taxpayer dollars to pay private companies to do things they’re already doing.””
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“Manchin is correct in saying that some companies are indeed changing over to sustainable electricity production; currently, almost 40 percent of electricity generated in the US comes from a clean energy source, either nuclear or renewable. But corporations are ultimately concerned about their bottom line, and the carrot-and-stick approach of the proposed clean electricity program incorporates that reality by incentivizing companies to make the drastic changes necessary to address climate change — and penalizing them if they don’t.
The other reason a clean electricity program could prove key to addressing climate change is that it creates a national standard, as opposed to the patchwork of municipal and state legislation and individual efforts currently in place. Among other impacts, the program would help bring lagging areas up to speed with the ambitious targets set by the Biden administration, which call for 80 percent of the nation’s electricity to come from renewable sources by 2030, and 100 percent by 2035.”
“In the wake of the 9/11 attacks, the United States invaded and occupied two countries, bombed four others, helped create 21 million refugees and cause over 800,000 deaths, and spent over $6 trillion on combat and anti-terrorism measures. Republican and Democratic presidents and congressional leaders authorized sweeping new initiatives that effectively put all American citizens under surveillance.
Even as the United States has left Afghanistan, ending our longest war, many of the programs and mindsets born out of events 20 years ago are still firmly in place. In Reign of Terror, national security reporter Spencer Ackerman argues that the war on terror also profoundly destabilized American politics and helped to produce the Donald Trump presidency by stoking fears of a racialized Other. “The longer America viewed itself as under siege,” he writes, “the easier it became to see enemies everywhere.””
“One of Sessions’ final moves in office was to sharply limit when the Justice Department could enter into consent decrees. Vanita Gupta, who ran the Civil Rights Division during the Obama administration, called that policy “a slap in the face to the dedicated career staff of the department who work tirelessly to enforce our nation’s civil rights laws.” The Biden administration rolled back Sessions’ directive, and Gupta is now back at the Justice Department as an associate attorney general.
Sessions was correct that consent decrees should be used judiciously. Justice Department investigations and settlements are a heavy-handed imposition of federal authority. But they can also provide recourse for citizens who have been betrayed by rotten police departments and indifferent local governments.”
“Already grappling with coronavirus, a political crisis stemming from President Jovenel Moïse’s assassination last month and resulting gang violence, Haiti was hit with a two-punch 7.2-magnitude earthquake and tropical depression this week, leaving almost 2,000 dead and thousands more injured or missing.
Thousands are without shelter because some 83,000 homes have been destroyed. International aid has been slow to arrive, delayed by Tropical Storm Grace’s heavy rains, and some Haitians are frustrated that their own government hasn’t done enough to help.
Also of little help has been the United States, one of the contributors to Haiti’s political and economic troubles, which has the ability to aid Haitians attempting to flee the country due to its three most recent crises, but has instead prevented them from accessing the protection to which many of them are entitled.
The Biden administration has sent a search and rescue team to the island and is transporting medical personnel to the most hard-hit areas and carrying out evacuations. It is also distributing much-needed supplies, such as food, hygiene kits, and tents.
But the administration is still turning away Haitians who have chosen to flee in light of recent events. Thousands of Haitians are still stuck in Mexico on account of US policies, which currently allow asylum seekers and other migrants to be turned away on the basis of pandemic-related border restrictions, known as the Title 42 policy.
Many more Haitians may seek entry: Though it’s hard to estimate how many, the Darién Gap, a treacherous stretch of jungle and swamp on the border of Panama and Colombia that has functioned as a migrant corridor, has seen more crossings this year — at least 46,000 — than it has in the previous three years combined, and most of those attempting to navigate it are Haitians and Cubans.
The Biden administration has allowed more than 100,000 Haitians who arrived in the US before July 29, 2021, to apply for Temporary Protected Status (TPS), which is typically offered to citizens of countries suffering from natural disasters or armed conflict. Those people are able to live and work in the US free of fear of deportation.
But that doesn’t help those who might be continuing to leave the country due to the political fallout from Moïse’s July 7 assassination, or now, in the aftermath of Saturday’s earthquake. What’s more, Haitians who have been prohibited from entering the US under Title 42, for which experts say there is no public health justification, appear indefinitely trapped in Mexico. And the US has continued to carry out deportation flights of Haitians despite the turmoil.
At the same time, the Biden administration has discouraged Haitians, as well as Cubans fleeing their communist regime’s recent crackdown on anti-government protesters, from trying to reach the US by boat. Officials have made clear that those who try will be intercepted by the US Coast Guard and will not be permitted to enter the US. Instead, they will either be repatriated back to Haiti or, if they can demonstrate the need for humanitarian protection, resettled in another country.”
“The Biden administration is racing to rebuild senior agency roles depleted by the previous president, hiring at the fastest rate in decades, a POLITICO analysis found.
In the first three months of 2021, the Biden administration hired more than twice as many senior government executives than Donald Trump did in the same timeframe, a staffing spree aimed at rebuilding agencies rocked by turmoil during Trump’s war on the so-called “deep state.””
“American companies were glad to see Biden review Trump’s trade policies toward China, but eight months later, they have seen little change on tariffs or other issues bedeviling their business in the world’s second-largest economy.”
“Multiple investigations, including by United Nations officials, have determined the Rohingya were victims of genocide or that there was strong evidence of it. Dozens of countries, led by The Gambia, have pushed a lawsuit at the International Court of Justice accusing Myanmar of genocide.”