Thursday, November 20, 2014

Obama's Executive Action on Immigration Offers More Evidence of A Weakened Presidency

As Obama is set to take unilateral action on immigration reform, I am reminded of an op-ed I wrote on the eve of his 2nd inaugural. Sadly, Obama's decision to "go it alone" is a common feature of contemporary presidents and by far a greater sign of presidential weakness than of gridlock.

Steve Schier and I cover the presidential power trap in great detail in our book, American Government and Popular Discontent.


"Faced with obstacles to successful leadership, recent presidents have come to rely more on their formal powers. The number of important executive orders has increased significantly since the 1960s, as have the issuance of presidential signing statements. Both are used by presidents in an attempt to shape and direct policy on their terms. Presidents have had to rely more on recess appointments as well, appointing individuals to important positions during a congressional recess (even a weekend recess) to avoid delays and obstruction often encountered in the Senate. Such power assertions typically elicit close media scrutiny and often further erode political capital.

Faced with the likelihood of legislative defeat in Congress, the president must rely on claims of unilateral power. But such claims are not without limit or cost and will likely further erode his political capital."

Full Op-Ed:

January 21, 2013|By Todd Eberly
As Barack Obama prepares to be sworn in for the second time as president of the United States, he faces the stark reality that little of what he hopes to accomplish in a second term will likely come to pass. Mr. Obama occupies an office that many assume to be all powerful, but like so many of his recent predecessors, the president knows better. He faces a political capital problem and a power trap.
In the post-1960s American political system, presidents have found the exercise of effective leadership a difficult task. To lead well, a president needs support — or at least permission — from federal courts and Congress; steady allegiance from public opinion and fellow partisans in the electorate; backing from powerful, entrenched interest groups; and accordance with contemporary public opinion about the proper size and scope of government. This is a long list of requirements. If presidents fail to satisfy these requirements, they face the prospect of inadequate political support or political capital to back their power assertions.
What was so crucial about the 1960s? We can trace so much of what defines contemporary politics to trends that emerged then. Americans' confidence in government began a precipitous decline as the tumult and tragedies of the 1960s gave way to the scandals and economic uncertainties of the 1970s. Long-standing party coalitions began to fray as the New Deal coalition, which had elected Franklin Roosevelt to four terms and made Democrats the indisputable majority party, faded into history. The election of Richard Nixon in 1968 marked the beginning of an unprecedented era of divided government. Finally, the two parties began ideologically divergent journeys that resulted in intense polarization in Congress, diminishing the possibility of bipartisan compromise. These changes, combined with the growing influence of money and interest groups and the steady "thickening" of the federal bureaucracy, introduced significant challenges to presidential leadership.
Political capital can best be understood as a combination of the president's party support in Congress, public approval of his job performance, and the president's electoral victory margin. The components of political capital are central to the fate of presidencies. It is difficult to claim warrants for leadership in an era when job approval, congressional support and partisan affiliation provide less backing for a president than in times past. In recent years, presidents' political capital has shrunk while their power assertions have grown, making the president a volatile player in the national political system.
Jimmy Carter and George H.W. Bush joined the small ranks of incumbents defeated while seeking a second term. Ronald Reagan was elected in two landslides, yet his most successful year for domestic policy was his first year in office. Bill Clinton was twice elected by a comfortable margin, but with less than majority support, and despite a strong economy during his second term, his greatest legislative successes came during his first year with the passage of a controversial but crucial budget bill, the Family and Medical Leave Act, and the North American Free Trade Agreement. George W. Bush won election in 2000 having lost the popular vote, and though his impact on national security policy after the Sept. 11 attacks was far reaching, his greatest domestic policy successes came during 2001. Ambitious plans for Social Security reform, following his narrow re-election in 2004, went nowhere.
Faced with obstacles to successful leadership, recent presidents have come to rely more on their formal powers. The number of important executive orders has increased significantly since the 1960s, as have the issuance of presidential signing statements. Both are used by presidents in an attempt to shape and direct policy on their terms. Presidents have had to rely more on recess appointments as well, appointing individuals to important positions during a congressional recess (even a weekend recess) to avoid delays and obstruction often encountered in the Senate. Such power assertions typically elicit close media scrutiny and often further erode political capital.
By mid-2011, Mr. Obama's job approval had slipped well below its initial levels, and Congress was proving increasingly intransigent. In the face of declining public support and rising congressional opposition, Mr. Obama, like his predecessors, looked to the energetic use of executive power. In 2012, the president relied on executive discretion and legal ambiguity to allow homeowners to more easily refinance federally backed mortgages, to help veterans find employment and to make it easier for college graduates to consolidate federal student loan debt. He issued several executive orders effecting change in the nation's enforcement of existing immigration laws. He used an executive order to authorize the Department of Education to grant states waivers from the requirements of the No Child Left Behind Act — though the enacting legislation makes no accommodation for such waivers. Contrary to the outcry from partisan opponents, Mr. Obama's actions were hardly unprecedented or imperial. Rather, they represented a rather typical power assertion from a contemporary president.
Many looked to the 2012 election as a means to break present trends. But Barack Obama's narrow re-election victory, coupled with the re-election of a somewhat-diminished Republican majority House and Democratic majority Senate, hardly signals a grand resurgence of his political capital. The president's recent issuance of multiple executive orders to deal with the issue of gun violence is further evidence of his power trap. Faced with the likelihood of legislative defeat in Congress, the president must rely on claims of unilateral power. But such claims are not without limit or cost and will likely further erode his political capital.
Only by solving the problem of political capital is a president likely to avoid a power trap. Presidents in recent years have been unable to prevent their political capital from eroding. When it did, their power assertions often got them into further political trouble. Through leveraging public support, presidents have at times been able to overcome contemporary leadership challenges by adopting as their own issues that the public already supports. Bill Clinton's centrist "triangulation" and George W. Bush's careful issue selection early in his presidency allowed them to secure important policy changes — in Mr. Clinton's case, welfare reform and budget balance, in Mr. Bush's tax cuts and education reform — that at the time received popular approval.
However, short-term legislative strategies may win policy success for a president but do not serve as an antidote to declining political capital over time, as the difficult final years of both the Bill Clinton and George W. Bush presidencies demonstrate. None of Barack Obama's recent predecessors solved the political capital problem or avoided the power trap. It is the central political challenge confronted by modern presidents and one that will likely weigh heavily on the current president's mind today as he takes his second oath of office.

Sunday, November 2, 2014

About the Hogan Poll Showing Him Ahead by 5 Points....

I have no idea how the MD gubernatorial race between Republican Larry Hogan and Anthony Brown will end, but the race appears to be very close. The Cook Political Report recently classified the contest as a tossup.  The Hogan camp caused a stir this past week by releasing an internal campaign poll that showed Hogan beating Brown 44-39%. Right away I was suspicious - a dead dog with a D after its name on the ballot would draw more than 39% in Maryland -right? So I contacted the Hogan campaign and convinced them to share all of the internals of the poll including questions asked and demographics of the sample and voting coalitions. Try as I might I could not find a flaw in the methodology or the questions. The sample size is a bit small so the error margin is a bit larger than usual. But if you consider the succession of polls from the Washington Post, to the Baltimore Sun, to Gonzales Research Marketing, and now to the Hogan poll there has been movement toward Hogan. Also, the three debates were good for Hogan. The first two were a tie, but Hogan won big in the third debate. Contrary to the dangerous candidate Brown accused Hogan of being, voters saw a candidate who was about as extreme as a vanilla milkshake.

The poll appeared to have a proper sample. It assumed an electorate that was 55% Democrats, 26% Republicans, and 19% Independents. Some have argued this is a bad sample as Democrats were 62% of the early voters and Independents were only 10% - wrong. Early voting attracts partisans eager to vote, but early voting is not a predictor of overall turnout.  In 2010, Democrats were 57% of the electorate and they have lost registration ground since then.

The Brown campaign has tried to downplay the poll, pointing to the 2 to 1 early vote Democratic turnout advantage last week. Problem is, that advantage was 3 to 1 in 2010. So Democrats are doing worse this election cycle than in 2012.  Of course in 2010 O'Malley crushed Ehrlich by a 14 point margin - so Democrats can lose some ground and still deliver for Brown. Then again, Ehrlich ran a horrible campaign in 2010 and surrendered votes a better GOP candidate would've won. This time around it's Brown who is running a bad campaign. As noted by Heather Mizeur, Brown's campaign has been relentlessly negative and, as described by the Baltimore Sun, "strikingly dishonest." Who knows how all of that will shake out.

The sample also assumed an electorate that would be 29% African American - essentially what it was in 2012. Based on weak primary turnout in PG County and Baltimore City, the final share may be lower than 29%. The poll found Hogan beating Brown 3 to 1 among white voters, but Hogan was only attracting 13% of the African American vote. Hogan was winning Independents by 2 to 1 and was receiving a 25% of the Democratic vote. The numbers all made sense. There were many undecideds and the poll pointed to a lot of unease with Brown.

And the most interesting aspect of the poll, to me, were the questions asking "How much have you seen, read, or heard recently about Anthony Brown/Larry Hogan and his campaign for Governor?" Then folks were asked "would you say you have a MUCH (more/less) favorable impression of him?" Now 2/3 of respondents said they learned some or a lot about Hogan during the campaign and by a 55-32% margin, what they learned made them feel more favorable toward him. But 3/4 indicated learning some or a lot about Brown and by 34-48% margin what the learned made them feel less favorable toward him.
It suggests Brown's negative campaign has backfired.

Is the poll a fluke? A bad sample? We'll find out Tuesday. But the findings certainly help to explain all of the high profile visitors like the Clintons and Obamas trying to rally support. The finding also help explain the recent mailing by the MD Democratic party that attempted to link the election to the incident in Ferguson, MO. The poll found Brown receiving 60% of the African-American vote. Hogan was at 13%. So 27% of African-Americans were undecided a week before an election where Brown could become the state's first African-American governor. You have wonder, if Brown can't count on the overwhelming support of the Democratic party's most loyal voters then how many other normally Democratic voters are equally ambivalent about him?

As a political scientist, I'm trained to predict the the future based observation of the past. As such, I have to believe that Brown is likely to win this race. Democrats have tremendous structural advantages in the state and come Tuesday we could see Hogan win by 3 or lose by 10. But it is becoming easier to see Hogan's path to victory. Though it's still hard to see how Hogan could be 5 points up in a state that has only elected two GOP governors in the last 45 years. It's hard as well to accept that Brown could be doing worse than Kathleen Kennedy Townsend. But this poll reveals real trouble for Brown. And he may well find himself the second MD heir apparent to have stumbled on his way to the coronation.

Tuesday will tell the tale.


Wednesday, October 29, 2014

Voters Deserve better than Dishonest Campaigns

Among the many election mailers that I received this week two stood out. One was a Republican financed mailer attacking District 29B Delegate John Bohanan (D) and the other was financed by state Democrats and attacked District 29C Delegate Tony O'Donnell (R). But these mailers did more than just attack Bohanan and O'Donnell, the mailers contained outright lies about both men. The anti-Bohanan mailer claimed that he had supported elimination of the death penalty and supported publicly financed needles for heroin addicts. The anti-O'Donnell mailer warned voters that he opposed replacing the Thomas Johnson bridge placing the safety of our families at risk.

Pretty damning stuff. Too bad none of it's true. Anyone who pays attention to Maryland politics knows that Bohanan vigorously opposed the state's recent repeal of the death penalty and when a bill was put forward to provide a publicly funded needle exchange statewide Bohanan voted against it. As for O'Donnell, anyone ho has had more than a passing conversation with O'Donnell knows that replacing the Thomas Johnson bridge is his top priority. So how could Democrats support their claim that he is against replacing it? Because O'Donnell voted against increasing the gas tax. O'Donnell didn't vote against replacing the bridge, he voted against a tax increase that may not have been necessary had Governor O'Malley not repeatedly raided the state's transportation trust fund.

John Bohanan and Tony O'Donnell may come from two different parties, but they share the same commitment to southern Maryland, and each has earned another term. The mailers weren't just misleading, they were dishonest. The voters of District 29B and 29C deserve better. And two men who have been tireless public servants, powerful voices for southern Maryland, and fierce advocates for their constituents, deserved better.


Monday, October 13, 2014

Second Brown/Hogan Debate Ends in Another Tie

The second Maryland gubernatorial debate is in the can (or on the web...) and, for me anyway, the results mirrored the first debate. Both Anthony Browne and Larry Hogan performed well, neither made any serious mistakes, and neither scored any major blows. It was a tie. The debate itself, however, came across as a disorganized mess. But more on that later.

Anthony Brown
After 8 years as Lt. Gov. Brown is having serious trouble sealing the deal with voters in a state that favors his party by a 2-to-1 margin. There are many causes for his problems. 1) The national and the Maryland economy remain weak. Recent reports show that middle class Americans have seen all the income gains made between the mid-1990s and 2009 disappear in the last 5 years. In Maryland, wages have stagnated, unemployment is higher than the national average, and a record number of people have simply dropped out of the labor force. Good luck being the quasi-incumbent running in the midst of all of that. 2) Martin O'Malley is unpopular. No doubt part of O'Malley's collapse is linked to the poor economy, but I think it's linked as well to a sense that at a time of need within the state O'Malley is touring Iowa and New Hampshire in hopes of being president. I think folks see in Brown another rising star of the Democratic party and wonder if he'll follow O'Malley's example and put national ambitions ahead of his state. And 3) even after 8 years, most folks don't know Anthony Brown. Brown jumped into the governors race before anyone else, but even as he was securing a running mate and endorsements he was not introducing himself to voters. His campaign was structured around the assumption that Brown would be the presumptive frontrunner in the primary and that the general election would be a mere formality. As such, his campaign has shielded him from the press and the public. He does not attend unscripted events and prefers to meet with friendly audiences. As to the press, he rarely does interviews and his campaign manager has had more to say about Brown's agenda than has Brown.

It has been clear for weeks that the general election will not be a cake walk. And yet, the Brown campaign refuses to change strategy. They need to get Brown out in public. They need him in front of cameras and talking with reporters. The Baltimore Sun poll found that Brown is supported by only 71% of Democrats and he's losing independent voters by double digits. Worse, fully 25% of Brown's supporters are open to changing their mind. Based on current polling, if only half that many do change their minds then Brown loses. Brown has been so committed to telling voters why they shouldn't vote for Hogan that he forget to tell them why they should vote for him. A better Maryland for more Marylanders is not a reason, it's barely even a bumper sticker. In the debate today, he repeatedly reminded voters that the election is about the future - but he offered little regarding what that future would involve.

Brown's best moment was his discussion of the MD gun control bill. His passion was clear and when he indicated that Hogan said one thing in public and another in private he was clearly trying to raise doubts in voters minds about Hogan's promises to not try to undo "settled law" regarding guns, abortion, or same sex marriage. His closing statement in which he linked his military service to his public service was strong as well.

Brown's worst moment was attempt to belittle Hogan's understanding of the complexities involved in managing a state by saying to Hogan that he was a "small" business owner. In prior debates, Brown has said small businesses are the backbone of the economy and that he supports small businesses, but I guess he just doesn't think small business owners are smart enough to govern? It was a mistake.

Brown's non-answer to the question about funding pre-k was a bad moment as well. He essentially said that if the gambling revenue isn't there then Maryland will do what it has always done to deal with shortfalls. He then paused and quickly added, "by not raising taxes..." Well Maryland did raise taxes to deal with prior shortfalls. We raised taxes, froze spending, raided trust funds, shift costs to counties, and skipped out on pension obligations. Hogan should've asked Brown which of those options he'd consider should the gambling money not materialize.

Larry Hogan
Hogan continues to stay focused on the economy. Some are suggesting that he needs to branch out, but that's only partially true. Hogan is a Republican running in a state where independent and unaffiliated voters will soon outnumber registered Republicans. His window of opportunity is narrow. A recent poll found that by a 48-44% margin, Marylanders believe the state is going in the wrong direction - a 4 point margin. In 2002, Bob Ehrlich defeated a woefully incompetent candidate, Kathleen Kennedy Townsend, by about 3 points. That margin is the best that Hogan or any other Republican can expect. Hogan needs to win the 48% who think Maryland is going the wrong way. Given that Democrats control every aspect of statewide governance, it's hard to imagine that many of the 48% blame Republicans for the state's problems. But Hogan is tainted as well by the national GOP and by the lingering remnants of the Tea Party. For many in Maryland, national Republicans are responsible for the government shutdowns and there is no doubt that the national GOP continues to oppose abortion rights and is the major roadblock to national gun control legislation. Though Hogan may not support the national party on any of those issues, the R after his name means that for many voters those issues hang around his neck. Hogan needs to do better than simply say, it's settled law. Shift the focus more to the people. Say that if elected he will serve the people and their agenda. They've spoken on same sex marriage, abortion, and in state tuition for undocumented kids. Sometimes the job of those we elect is to stop and listen to the people. Then he needs to turn that around and say that too often those in Annapolis have forgotten to listen -  they refused to hear the people on the sales tax, the gas tax, the rain tax. They failed to hear the people when they raided trust funds dedicated to the bay. That's what he needs to do.

Hogan's best moment was in his rebuttal to a question about the errors in his campaign's plan to save $1.7 billion in fraud, waste, and abuse. The report is full of errors and Hogan couldn't really defend it, but rather than focus on that, Brown pointed to his own plan that has identified $1.5 billion in savings. Hogan responded with the perfect question - if you know the state is wasting $1.5 billion per year why haven't you fixed it?

But next time, Hogan needs to go after Brown's plan. The $1.5 billion will never materialize. Consider two items from the plan. Brown's plan says that MD is spending $105 million each year on improper Medicaid payments. If true, the federal Center for Medicare and Medicaid Services (which covers half on MD's Medicaid costs) would likely demand an audit of those payments and demand that the state reimburse the federal government - so that's money lost. Brown's plan also calls for $30 million in savings by reducing chronic diseases among state employees. Folks, chronic diseases are the leading cost drivers in the health care system. If we could manage chronic diseases then our nation's long term spending problems (all linked to Medicare and Medicaid) would be solved. So the notion that MD will solve a problem among state employees what no nation has managed to control seems unlikely. It wouldn't hurt for Hogan to point to specific problems like those.

Hogan's worst moment? He was too thin skinned when Brown was linking him to the Ehrlich administration. I'm not sure why he was so defensive. His retort that it wasn't Ehrlich/Hogan but it is O'Malley/Brown was weakened by his defensive tone. Next time Brown says Marylanders don't want to return to the "dark days" Hogan should just say that during those dark days unemployment was lower and wages were actually growing.

Hogan's other bad moment was his weak answer on gun control. Suggesting that he opposed a bill because it didn't do enough is a bad answer and it undercuts his message that he's a pragmatist. You know who reject bills because they don't go far enough? Ideologues. They want all or nothing and usually get nothing. Hogan needs a better answer and Brown needs to keep hitting on that issue.

The Debate Itself
I got the feeling that the moderators decided that they would try to cover every topic that people felt had been ignored in the first debate - bad idea. Sometimes topics are ignored for a reason. Doug Gansler tried again and again to get traction on the failed health exchange website - it never connected with voters - move on. Perhaps the better and more relevant question would be how will the tens of thousands of folks newly enrolled in Medicaid (mostly adults) find a doctor in a program that mainly serves children? By the state's own admission there were too few doctors in about 40% of the state to meet the needs of Medicaid enrollees BEFORE the expansion (pages 9-10 of the linked report). After the expansion many Marylanders will find that their new insurance card will simply be a license to hunt for a doctor who will take it.

It was also unclear just what the rules were. Was it response, rebuttal, rebuttal response? That seemed to be the case, but at times it was clearly response, rebuttal, rebuttal response, rebuttal response response, and once there was a rebuttal response response response... Moderators need to enforce the rules and keep the debate moving. And what was with the climate change question - the moderator directed the candidates to give a one word answer if possible. Really?  I thought the reference to questions coming in via twitter and social media was distracting and time consuming. Who cares where the question came from? If it's a good question, just ask it quickly and let the candidates reply. And I thought it was odd how a moderator would sometimes prompt another moderator - "did you have a follow up that you wanted to ask regarding my question?" If a moderator has a follow up, he or she will ask it. The debate was as long as the prior debate, but it felt shorter and less substantive, and not because of the candidates. Moderators should keep the train running on time, ask questions, and otherwise blend into the background. I like and respect each of the moderators, but I think a three person panel, especially three people crammed around a little table, was just a bad idea.

So I end this review much as I did the first review - it was a tie. This is still Brown's race to lose (this is Maryland after all), but Hogan is a serious threat. I think turn-out will be awful and right now, Hogan is ahead among the voters who most reliably turn-out.

Tuesday, July 22, 2014

Is the Affordable Care Act on Life Support? Maybe.

Here's my quick take on this and why I think the Supreme Court will agree with DC Circuit Court of Appeals and strike a lethal blow to the Affordable Care Act. 

In short, section 1411 of the Affordable Care Act specifies that premium assistance can only be given to exchanges established by a State under section 1311. An exchange established by the Federal Secretary of Health and Human Services under section 1321 does not qualify according to the letter of the law. But when the IRS issued implementing regulations the agency interpreted "established by the State" to mean any exchange operating in the State.

That's the point of contention. Today, the DC court said the IRS overstepped its authority and violated the clear letter of the law. The 4th Circuit disagreed and said section 1401 is "ambiguous" and as such the IRS was free to interpret the true meaning and the courts should defer.

I really don't think that the 4th Circuit's "ambiguous" argument will pass muster in the Supreme Court. A 5 vote majority would likely decide that section 1411 was not ambiguous and not even in error as the wording is repeated in the Definitions section of the Affordable Care Act. So twice, Congress stipulated that subsidies were only available to those who enrolled in an exchange established by the State under section 1311.

If this is upheld by the Supreme Court then much of the Affordable Care Act and the attempt to reach near-universal coverage will essentially die. There are over two dozen states that never established exchanges and millions in those states would lose their subsidies and then their insurance. And there would be no bare bones, low cost alternatives available because of the minimum benefit standards established by the law.

It would be a nightmare, but a nightmare of Congress' making. All of the normal procedures for legislating were pushed aside in the push to enact the law after losing the filibuster-proof majority in the Senate. No amendments were allowed, no conference committee appointed, no opportunity to look for problematic language. I warned of this back in March of 2010 in a post titled "Why Process Matters" in which I wrote of the Affordable Care Act "It will face years of legal challenges and likely deeply entrenched public opposition. Worse, the manner in which the bill is being pushed may allow for errors or inconsistencies in the law that could weaken or undermine it in unanticipated ways. The normal process may cause delays and be fraught with obstacles, but it exists to protect the public and to promote sound legislation.

Suddenly the 2014 midterms take on a new meaning. If the Supreme Court does strike down the subsidies Obama may have to go to a GOP House and Senate to seek a legislative solution. I expect they extract a heavy price.

Below are key excerpts from the law with certain crucial sections highlighted.

The key comes down to the use of the word "State" in SEC. 1401. REFUNDABLE TAX CREDIT PROVIDING PREMIUM ASSISTANCE FOR COVERAGE UNDER A QUALIFIED HEALTH PLAN. Which explains, "Premium assistance amount.--The premium assistance amount determined under this subsection with respect to any coverage month is the amount equal to the lesser of-- `(A) the monthly premiums for such month for 1 or
                more qualified health plans offered in the individual
                market within a State which cover the taxpayer, the
                taxpayer's spouse, or any dependent (as defined in
                section 152) of the taxpayer and which were enrolled in
                through an EXCHANGE ESTABLISHED BY THE STATE under 1311

                of the Patient Protection and Affordable Care Act."

Section 1311 specifies all the ways in which a State can establish an exchange. At no point in Section 1311 is the Federal Exchange ever mentioned.

The Federal Exchange is first mentioned several sections later in SEC. 1321. STATE FLEXIBILITY IN OPERATION AND ENFORCEMENT OF EXCHANGES AND RELATED REQUIREMENTS.

Which reads:

Failure To Establish Exchange or Implement Requirements.--
            (1) In general.--If--
                    (A) a State is not an electing State under
                subsection (b); or
                    (B) the Secretary
                determines, on or before January 1, 2013, that an
                electing State--
                          (i) will not have any required Exchange
                      operational by January 1, 2014; or
                          (ii) has not taken the actions the Secretary
                      determines necessary to implement--
                                    (I) the other requirements set forth
                                in the standards under subsection (a);
                                    (II) the requirements set forth in
                                subtitles A and C and the amendments
                                made by such subtitles;
       THE SECRETARY SHALL (directly or through agreement with a not-
        for-profit entity) ESTABLISH and operate such Exchange within
        the State
and the Secretary shall take such actions as are
        necessary to implement such other requirement."

So there you have it. The law clearly says that subsidies are available to those enrolled in exchanges established by the State as the language regarding the federal exchange comes several sections later and refers to the Secretary establishing it...

The court is being presented with a case of the letter of the law v. the intent of the law. If a court thinks the letter is clear it will trump the intent.

Thursday, July 3, 2014

The Real Force Behind the Hobby Lobby Decison is the Religious Freedom Restoration Act - Not Five Justices

I've been reading the majority opinion in the Hobby Lobby case and it's just fascinating. But the press coverage and talking head rhetoric is so hyperbolic, discussion of the majority's reasoning are all but absent. I wanted to understand it. What I've learned is that many folks have no idea what the case was really about or what the court was being asked to decide. Folks clearly have no knowledge of the Religious Freedom Restoration Act which is the legislation at the heart of all of this.

I will not engage in any discussion of the impact of the ruling. And I'm certainly not saying it was a good decision or a bad decision. Please do not read anything into what I've written. As I said, I'm just exploring the logic behind the ruling.

First and foremost, a critical thing to understand at the outset is that sole proprietorships and general partnerships were already recognized as individuals and as individuals they could seek an exemption from contraceptive mandate under the Religious Freedom Restoration Act (RFRA) of 1993.  Non-profit religious organization were also able to request exemptions. I've heard a lot of people say variations of "employers shouldn't be making health care decisions for employees." But that was already happening and was specifically allowed. It is estimated that approximately 30% of employees work for employers exempted from the contraceptive mandate. In fact, a lower court Judge argued that so many employers have been exempted from the mandate that the Obama Administration could not claim there was a compelling state interest in imposing the mandate.

Many talking heads are saying that in the Hobby Lobby case the court "again" decided that corporations were people with rights. But that's incorrect. In the Hobby Lobby case the majority didn't grant the contraceptive exemption based on corporations being "persons" with religious freedom under the RFRA. In the Hobby Lobby case, the Supreme Court acknowledged that corporations are fictitious persons. But in a closely held corporation where 5 or fewer people own the majority of the company the court majority ruled that when government compels the corporation to do something it is really compelling those 5 people to do something - there is no diffuse ownership. In that case, the RFRA protections apply. So the Hobby Lobby decision basically said that in closely held corporations the fictitious person gives way to actual persons. Remember, it's already established and accepted that individuals, sole proprietorships, and general partnerships can seek exemptions based on religious beliefs under the Religious Freedom Restoration Act. It just wasn't settled whether for-profit corporations could. Alito essentially bypassed that issue by saying that we're really dealing with individuals.

From the ruling: "A corporation, being a fictitious construct with no real existence in the context of a closely-held corporation, is too slight and gossamer a thing to put any weight upon as far as distinguishing burdens placed on it and burdens placed on its owners."

In other words, if individuals, sole proprietors, or general partnerships can seek an exemption then the owners of a closely held corporation could as well as they are little different from general partnerships.  In a general partnership and a closely held corporation - you are essentially dealing with individuals.

Justice Alito wrote in his opinion that he can't imagine there are any large corporations (many people owning the majority of stock) that would be able demonstrate eligibility for a religious exemption. Ownership of large corporations is so widely diffused that there is really no way to demonstrate that the "owners" are being asked to violate their beliefs. Alito also said that this was a narrow ruling and it would not open the door for corporations to seek exemptions from other services like immunizations or blood transfusions.

Justice Ginsburg argued in her dissent that the ruling was actually quite broad and it opened the door to all sorts of religious exemption claims. She also argued that for-profit corporations cannot claim religious exemptions because they are first and foremost organized for competition  and customers in the commercial market place and not for the primary purpose of serving their religious beliefs or serving fellow adherents to their religion. Interestingly, Justices Breyer and Kagan did not sign on to Justice Ginsburg's dissent, specifically the part where Ginsburg addressed the corporation question.

So that's pretty much it. This case was never really about the right to access to contraceptives, that wasn't the issue before the court. The case revolved around the Religious Freedom Restoration Act and whether its protections applied to corporations like the Hobby Lobby. As Paul Horowitz wrote in today's New York Times,
"The decision in Hobby Lobby was no shock to anyone familiar with the heavy weight that the Religious Freedom Restoration Act places on religious accommodation. The fate of the case was sealed 21 years ago — not by a slim majority of the court, but by virtually every member of Congress. "

The RFRA already established that folks could claim a religious exemption. And roughly 30% of all employees in the US were already exempt from the mandate. The majority of the court determined that that the owners of closely held corporations have the same protections as similar non-incorporated employers.

The real issue here is not the ruling of 5 Justices, the real issue is a very broad piece of legislation enacted in 1993 - the Religious Freedom and Restoration Act.  In my book, American Government and Popular Discontent, I write that Congress has increasingly come to rely on broadly written legislation. They do so because specificity creates openings for dissent and division. As a result of broad and ambiguous laws it often falls on the courts to determine what the law actually means.

Many of the folks who voted for the Religious Freedom Restoration Act are still in Congress (There is even an e-mail in which Elena Kagan, while working for President Clinton 1999, celebrated the act). Some are now saying they never intended it to be so broadly applied. Sorry, but that just doesn't fly. When you vote for an ambiguous law, when you opt to skip specificity just to ensure passage and avoid controversy, you must accept some responsibility when a court is called upon to provide that specificity.

Friday, June 13, 2014

Despite Headline, Pew Poll Does Not Show a Polarized America

In my first book with Steven Schier, American Government and Popular Discontent, I wrote extensively about the ongoing claims that the American public is deeply polarized. I disputed arguments offered by political scientists like Alan Abramowitz, author of The Disappearing Center, and found support for the claims of mass moderation overshadowed by elite polarization offered by Morris Fiorina in Disconnect.
I am currently writing a new book on the impact of ideology and polarization on American politics and have been picking through a new survey from Pew. According to Pew the study finds "Republicans and Democrats are more divided along ideological lines – and partisan antipathy is deeper and more extensive – than at any point in the last two decades. These trends manifest themselves in myriad ways, both in politics and in everyday life."
But, despite the headlines, the study doesn't really show that America is polarized. Rather it shows that a decidedly small group of ideological activists on the left and right are incredibly polarized and have each laid claim to one of the two major parties.
Here are some quick reactions which I think undermine the premise of polarization. In reality, the Pew poll confirms that WE ARE NOT a deeply polarized nation coming apart at the seams. Rather a small group of committed ideologues are working hard to pull us apart.

1.) True ideologues have increased by 11 percentage points in 20 years from 10% in 1994 to their present level of 21% - that’s hardly earth shattering. The scary headline being that they've doubled in size but the calm down and breath take away is that they are but 1/5 of the electorate.

Growing Minority Holds Consistent Ideological Views

2). And it is among the most ideological voters that Pew finds people unhappy with family members marrying outside of the party and having few friends in the other party.
But among most of the rest (the majority), we don’t care who our family members marry, we don’t care about our friends’ partisanship, and we like compromise.

Guess Who’s Coming? Ideological Differences in Views of  Family Member Marrying Different Race, Gun Owner
3) It’s among the most ideological that compromise is dismissed as selling out. The rest of us like compromise.

Compromise in the Eye of the Beholder

4) On the issue of geographic polarization or Red State v Blue State, the study found that liberals like communities where everything is close together while conservative live wide open spaces - that puts a new spin on the big sort. Dear God! We're coming apart at the seams! 
So, are we moving so we can be around like minded people or is it really that liberals and conservatives like different physical environments?
5) Do we want to live near people with similar views? With the exception of the small subset of "True Conservatives," the vast majority of everyone else doesn't care.
Ideological “Silos”

6) With regard to the amenities provided by a community, liberals and conservatives largely agreed that they want to live near family, with good schools, and access to the great outdoors.
Where do they differ? Liberals care more about having access to museums... Can we as a nation ever get past this divide?
Liberals, Conservatives Agree on Importance of Living Near Family, Good Schools and the Outdoors
7) The study does confirm that the most ideological are the most likely to vote and the most like to contribute money - so a minority of ideologues dominates American politics.
Voting, Donations Linked to Negative Views of the Other Party
8) Those in the middle outnumber those on the wings. But they do not participate and do not make use of their numerical advantage. American politics is polarized not because the people are polarized, but because the vast and vital center has ceded all control to the small and malignant wings.

Wednesday, May 7, 2014

Very Quick Thoughts on MD Dem Gubernatorial Debate

And the winner is…. Doug Gansler.

Doug Gansler was the clear winner in the first televised Democratic gubernatorial debate - though that was not so evident during the opening minutes. Gansler’s opening statement seemed to be little more that boilerplate sloganeering and then he got off to a slow start on the first question concerning MD’s failed health exchange. Gansler needs to walk a fine line on the exchange - he can’t be seen as criticizing the Affordable Care Act, but he needs to criticize its failed implementation in MD. He found that fine line tonight. The 2014 midterms are shaping up to be bad news for Democrats nationally owing to ongoing unpopularity of health reform, Gansler essentially accused Brown of handing the GOP a path to victory by botching the implementation. On the second question, concerning marijuana legalization, Mizeur offered the best direct response, but it was Brown’s misstep that stood out. Brown’s pivot away from marijuana decriminalization and attempt to paint Gansler as hostile to the rights of racial minorities owing to his support of the death penalty came across as simultaneously low and an overreach. On the question of taxes, Brown promised a Blue Ribbon Panel and attacked Gansler’s support of a corporate tax rate cut. Gansler swung right back, reminding voters that the O’Malley/Brown team have presided over numerous tax increases and that leading Democrats in the state - including Steny Hoyer - support lowering the corporate tax rate.

Heather Mizeur started out strong, but them seemed to fade into the background - almost entirely because the moderator, David Gregory, did such a bad job moderating. Gregory turned the debate into the Gansler/Brown point/counterpoint show. I think being constantly excluded from exchanges threw Mizeur off of her game. Her strongest moment was the discussion of qualifications and her work to pass bipartisan family planning legislation. She helped her campaign, but the impact of the debate will be muted because of Gregory’s failure as a moderator. Mizeur very effectively reminded voters of the gender wage gap in America. Gregory seemed to think that since women earn on average 15% less than men that Mizeur should receive 15% less debate time than either Gansler or Brown. Let's close that gap next time.

Brown stumbled right out of the gate. He started with a very strong bit about his family biography that never really led into a policy discussion or governing philosophy. Most of the evening he seemed more interested in getting in clearly rehearsed attacks on Gansler (the death penalty, the beach party, the reprimand) than in discussing his plans for the state. In his closing statement he promised, “I have a plan,” and all I could think was, then why didn’t you discuss it? I think the worst moment of the debate was Brown's very clumsy pivot to the death penalty and racial bias in response to the marijuana legalization question. Was he really trying to insinuate that Gansler was hostile to issues of racial bias in the justice system? It was a bad moment in a bad night for Brown. But there were no lethal blows either received or self-inflicted.

In all, I see no game changing moment, though Gansler certainly helped his cause Brown's weak performance wasn't deadly and Mizeur was denied the breakout moment that she needs. Brown needs to do much better at the second debate. Mizeur needs to make sure no other moderator shuts her out the way Gregory did. Gansler needs to be ready for a much better prepared Brown.

Thursday, April 24, 2014

For Gansler and Brown it's All About Being Disliked Less

There is a great graphic included with the released of the new St. Mary's College Maryland Poll. It tracks candidate support from the first statewide poll taken in October of 2013 up though the college's just released poll.

Anthony Brown is the sitting, two-term LT. Governor. He has been running for this nomination for the past year. He has raked in the endorsement of every high profile Democrat in Maryland, multiple special interest groups, and Bill Clinton. And yet, his level of support has fallen by nearly 14 percentage points since October.

Doug Gansler is the sitting, two-term Attorney General. He scared away any competition in 2010 and was reelected with better than 90% of the vote. He's been running for the nomination since his first election as Attorney General (he often joked AG actually meant aspiring governor). He officially declared his candidacy back in September. Since then, his support has fallen by over 10 percentage points.

Heather Mizeur was a little known and very progressive delegate from Montgomery County when she announced that she was going to join the race as well. Few in the press took her seriously at the time, but she has run a clean and rather uplifting campaign. Her level of support has increased by 2.5 percentage points. Though she's still in the single digits, Mizeur is the only candidate gaining ground. She still has a lot of ground to make up, but it's a lot easier to gain on an opponent when that opponent is falling.

Meanwhile, "No Preference" has become a voter favorite. Mr. Preference was trailing LT. Gov. Brown by nearly 8 points in October, but has since surged 21 points to become the unmistakable leader in the race.

This is a sad state of affairs folks. We have two rather well known and established candidates in Brown and Gansler - and yet, the more they campaign and the more people learn about them the less people seem to like them.

Gansler has been hounding Brown on the failure of the MD health exchange, continually questioning his leadership skills and qualifications to office. Though the leadership in the Maryland General Assembly effectively whitewashed any meaningful investigation, it's clear the matter has harmed Brown. Brown often responds to Gansler's criticisms by dismissing the Attorney General as reckless and unprepared. Gansler has been dogged by early scandals concerning his treatment of state troopers assigned to drive him and owing to his presence at a graduation party where underage drinking was taking place. Many believe that at least one of those "scandals" was fed to the press by the Brown campaign and it's clear that they have harmed Gansler.

In recent days, Brown and Gansler have accelerated the war of words. The graphic above explains why. It's clear that voters don't like either man - so now, each is simply trying to become the one that voters dislike less. How inspiring. It's a sad state of affairs.

But Gansler and Brown had better watch out. They're each doing such an effective job convincing the public to reject the other that by Primary Day on June 24th they may just discover that they were so busy tearing each other down they didn't notice how effectively they were building Mizeur up.

* I would've offered a similar assessment of the GOP race, but there was no October poll of GOP voters.

Wednesday, April 23, 2014

New Poll Confirms No One Cares About the MD Gubernatorial Race

The inaugural Maryland Poll from St. Mary's College of Maryland surveyed the political landscape heading into the 2014 primary election and found that most Marylanders have absolutely no preference when it comes to the candidates for governor.

The poll is in line with prior polls for Gonzales Research, The Baltimore Sun, and The Washington Post. Much like those polls, the Maryland Poll finds a very unsettled race for the GOP nomination and a Democratic race where the favorite, the sitting two term lieutenant governor, is being beaten by "No Preference" by a 2 to 1 margin.

The 2014 primary is two months away and yet most voters appear to have no firm commitments to the candidates.

No firm commitments

Specifically, the poll finds Anthony Brown with 27% support, followed by Douglas Gansler at 11% and Heather Mizeur at 8%. But fully 54% expressed no preference.

In a three-way race, Brown is close to the 34% that would be sufficient to win a closely matched election. But much like the other candidates, he has been unable to expand his base of support even after a year of campaigning and advertising.

Gansler has been hammering away at Brown on the issue of Maryland's failed health exchange, but with 11% support the issue does not appear to be helping him.

Mizeur has been generating a lot of coverage and interest of late owing to her unapologetically progressive campaign. She has embraced a living wage, physician-assisted suicide, a moratorium on fracking, legalization of marijuana, and host of other progressive wish list items. Yet she's made no noticeable progress in winning over potential voters.

Brown's to lose 

The Democratic primary remains Brown's to lose and it's likely that the upcoming debates will present the final opportunities for either Gansler or Mizeur to change that reality.

Interestingly, Gansler seems to have shifted his strategy. Early on, he presented himself as a centrist, pro-business Democrat. Recently, he has de-emphasized those qualities and instead focused on more progressive policy issues. This was a mistake.

In a three way race with two candidates already chasing the progressive vote, the smart move is to target the voters that the other two are ignoring. Gansler needs to pivot back to the center. His only path to victory requires Brown and Mizeur to split the progressive vote while Gansler goes for the moderate and conservative Democrats still in the party.

GOP's disastrous situation 

On the Republican side the poll finds a disastrous situation for the state's permanent minority party.

More than two-thirds of Maryland Republican voters have no preference. Larry Hogan claims the support of 16%, followed by David Craig at 7.8%. Neither Ron George nor Charles Lollar were able to crack 4%.

Maryland is a very tough nut for Republicans to crack. Democrats enjoy a 2 to 1 voter registration advantage and Republicans are rarely ever able to overcome the Democrats' advantages in the state's population centers.

For a Republican to win, the nominee would need several things to break his or her way.

·       The Democratic party must be divided after the primary. That could certainly happen this year.

·       The Democratic electorate must lack passion for the party's nominee. That could certainly happen this year.

·       It must be a good year for Republicans nationally (like in 1994, 2002, or 2010). That could certainly happen this year.

Beyond those three ingredients, a Republican candidate also needs a unified and passionate Republican party and an electorate frustrated with the direction of the state. Neither of those two ingredients are present.

Not enough dissatisfaction

With regard to the direction of the state: Though the poll found a plurality of 46% agreeing that the state is going in the wrong direction, another 41% said it was going in the right direction. That margin is not sufficient for a Republican to overcome the Democrats' built in advantages.

Keep in mind, Bob Ehrlich had an approval rating above 50% when he lost the 2006 election by 6 percentage points.

A clear majority of poll respondents supported increasing the minimum wage and reported that the Affordable Care Act either helped their families or had no effect on them, a slim majority supported decriminalizing small amounts of marijuana, and pluralities supported affirmative action, the fracking moratorium and gun control.

In a particularly interesting finding, the survey asked respondents how they were registered and then later asked what party they consider themselves to be a member of. The voter registration numbers essentially match state records - 53% Democrat, 28% Republican, and 18.5% Independent or other.

When asked how they see themselves, the breakdown was 44% Democrat, 25% Republican, and 31% Independent or other. The breakdown shows that there is an opportunity for the GOP in the state, but only if the party can broaden its appeal and only if party activists accept that the party cannot win without attracting Independent voters.

No frontrunners in GOP

Several months ago, as I was arguing that David Craig represented the GOP's best chance at reclaiming the governor's mansion, many Republican activists challenged my assertion. Both privately and via social media these activists suggested a much stronger candidate existed and would soon enter the race and energize the party. They were referring to Larry Hogan.

Well, Hogan's in the race and he is the "frontrunner." But in a race where 64% of potential primary voters have no preference, there are no frontrunners. Hogan has not lit the fire that many were expecting.

Likewise, Craig has not run the experienced, well managed campaign that I was expecting. Craig sought to shore up the GOP base by taking a distinct right turn (thereby harming his ability to win in November) and Hogan has adopted a play it safe strategy by skipping forum after forum (thereby harming his credibility).

And no GOP candidate has any real success raising money. All four candidates combined could barely reach $1 million - meanwhile, Gansler and Brown are each sitting on multiple millions.

As things stand today, it's hard to see the GOP reclaiming the keys to Government House. 

*Though I am an Associate Professor at St. Mary's College, I had no involvement in the development, execution, or analysis of the poll results.

Saturday, March 8, 2014

In District Maryland's 29B, Voters Need to Re-Elect John Bohanan

I have never formally endorsed a candidate in any election - until now. I have decided to weigh in on the race for District 29B in St. Mary's county - my county. In recent editions of the Enterprise and the County Times (our local papers) several members of my community have written letters urging voters to “kick Del. John Bohanan to the curb” in November - a distinct possibility given the changing political composition of the county. The letter writers typically cherry pick one or two votes, out of the thousands that Bohanan has cast, and present them as proof that he does not represent the views of St. Mary’s county voters. The most commonly cited examples are his votes to legalize same sex marriage and his vote to approve the recent increase in the gas tax.
Del. Bohanan was narrowly reelected in 2010 and Republicans now outnumber Democrats in St. Mary’s county, but I believe that voters would be sorry if Bohanan were defeated. The simple truth is that Bohanan is the only member of the St. Mary’s delegation who has any real influence in Annapolis. He is the chair of the powerful Spending and Affordability committee and sits on the Appropriations committee. His seniority and committee assignments allow him to “deliver the goods” to St. Mary’s county. Were he to be defeated, he would be replaced by a freshman Republican. I don’t particularly care if I’m represented by a Republican or a Democrat, I just want a representative with integrity and the power to be a forceful representative of my community. Were a Republican, such as candidate Deb Rey, to replace Bohanan she would go to Annapolis as a member of a minority party that is outnumbered by a 2-to-1 margin in the Assembly. A party with virtually no influence in the General Assembly. She would have no seniority, no prime committee assignments, and no chance of ever chairing a committee - in other words she would have no leverage and little to no ability to ensure that St. Mary’s county had a voice that was heard in Annapolis. St. Mary’s county is one of the fastest growing counties in the state and we cannot afford to be voiceless.

Clearly, Del. Bohanan is not the only representative of St. Mary's County in Annapolis and this endorsement is not intended as a slight to Sen. Roy Dyson, Del. Johnny Wood (29A) or Del. Tony O'Donnell (29C). Rather I am making an endorsement based on the best interest of St. Mary's county. District 29 encompasses both St. Mary's and Calvert counties. To many, the counties may seem indistinguishable, but the reality is the two counties are different and may well have differing agendas. Sen. Dyson and Del. O'Donnell represent both counties, as such they must always balance the needs of the two counties. In an era of limited funds and competition for resources I see that as an important distinction. As to Del. Wood, he is retiring. His seat will be filled by a freshman member with little to no influence. This makes the reelection of John Bohanan that much more important. Were Bohanan to be defeated, then both of St. Mary's dedicated districts - 29A and 29B - would be represented by relatively weak members of the Assembly. To me, that's not acceptable.
Am I making this endorsement based solely on Del. Bohanan's power and influence? Of course not. Neither would matter if I didn't respect him and his judgment. Have I agreed with every vote that Del. Bohanan has cast? Of course not. And when I have disagreed, he has heard from me. But that’s the nature of our system of government, a system where we elect a person to speak on behalf of a community. It is not the job of those we elect to simply serve as a megaphone or as a mirror reflecting the views of the voters - if that were the case our founders would have simply opted for a direct democracy. Instead, they chose a system in which we elect representatives and they are expected to use their best judgment and to make decisions they believe represent what is best for a community - even when a majority of voters may disagree. Though I have disagreed with some of his votes, I have never doubted that Del. Bohanan was motivated by what he believed to be in the best interest of St. Mary’s county.
I supported his votes in favor of same sex marriage and increasing the gas tax - though both were unpopular in St. Mary's county. In the case of same sex marriage, Maryland overwhelmingly endorsed the law in a referendum in 2012 and voters, as well as state and federal courts, have been tearing down the discriminatory barriers faced by same sex couples in other states. As to the gas tax, typically I oppose most excise taxes as they tend to be regressive and have a disproportionate impact on poor and working class people. But Maryland is in desperate need of infrastructure improvements, and as a fast growing county, St. Mary's is in particular need. Those improvements will benefit everyone, but cannot happen without sufficient funds. Perhaps of greater import, in the months before MD increased the gas tax, the Virginia legislature approved a plan to spend $3.1 billion dollars upgrading the state's infrastructure in an effort to attract businesses and residents. Though VA eliminated the gas tax, they actually increased everyone's taxes by hiking the sales tax to pay for the plan. Maryland could not afford to stand idly by in the face of such state competition. In both of these cases, Bohanan knew two things, 1) that his votes would be opposed by a majority of his constituents, and 2) that even in the face of that opposition, they were the right votes to cast. That's political courage.
I vehemently opposed some of Bohanan's votes - his decision to support Governor O'Malley's gerrymandered monstrosity masquerading as a redistricting map was one. His recent vote to increase the state minimum wage - an increase that I believe will harm youth and unskilled workers, especially in Baltimore City, Western MD, and the counties on the lower Eastern Shore - is another. I could name more, but such disagreements do not negate all of the good he has done for St. Mary's county. And after all, his job is not to simply reflect the policy wishes of me or any other single voter, rather his job is to represent what he believes to be in the best interest of my community. Something he does quite effectively.
Voters will have a choice to make in 2014, they can vote to deprive St. Mary’s of any meaningful and dedicated voice in the General Assembly, or, they can reelect John Bohanan and ensure that the needs of our county are heard loud and clear. To me, that’s an easy choice to make.

Saturday, February 15, 2014

Though the Minimum Wage Needs a Boost, it is not a Living Wage

In prior posts, I've argued against proposals in Maryland to raise the minimum wage to $10.10 per hour on the grounds that it will do significant damage to the employment prospects of young and unskilled workers - and not provide much actual help to the working poor.

What I've not made clear is that I do not oppose raising the minimum wage. In fact, I think a review of the history of the wage suggests that it should be raised to approximately $8.40 an hour and then indexed to inflation thereafter. But the proposal to make the MD minimum $10.10 by 2016 simply goes too far and would likely have significant negative effects on youth and unskilled employment levels. Those advocating the $10.10 an hour wage like to claim that had the minimum wage in the late 1960s simply kept pace with inflation the wage today would be well be roughly$10.50 per hour. Unfortunately, those folks are being intentionally misleading.

In fact, a new Congressional Budget Office report puts the lie to most of the claims made in support of the $10.10 minimum wage. According to the report, such a wage hike would result in the loss of 500,000 jobs. Though the wage hike would theoretically inject $31 billion dollars into the economy, only 19% of that would benefit families living in poverty while 29% would benefit families earning three times the poverty level or more - this is because most of those earning the minimum wage are not in poor working families. But the $31 billion figure is actually meaningless. The CBO estimates that 93% of the $31 billion would be negated by lost income to businesses, lost income from the resultant job loss, and lost income due to higher prices caused by the wage hike. In Maryland, Martin O’Malley has argued that a $10.10 minimum wage would pump $456 million into the Maryland economy, but if the CBO estimates are accurate, that $456 million would actually be less than $30 million owing to job loss, higher prices and lost business income. As an alternative, the CBO considered a $9 minimum wage as well and noted far fewer negative effects.

Are Minimum Wage Earners Young and Childless or Working Parents?
The other justification for the $10.10 per hour proposal is that it would raise the income of a family of four, with a single parent working full time, to the poverty level.  But this a dubious goal. The average family size in American is 2.6, not 4. At a recent town hall meeting in southern Maryland Senator Ben Cardin offered some less than helpful statistics regarding those earning minimum wage. He said that roughly 2/3 are women and the average age of an earner is 35. His intent was clearly to create the impression that most minimum wage earners are single Moms. This is not the case. Roughly 1/3 of low income families are in house holds with a single adult.

As to the average age, the statistics shows why social scientists have three measures of central tendency, 1) the mean or simple average, 2) the median or value at which half the observations are above and half are below, and 3) the mode or the most frequently observed value.  Though most people are familiar with concept of an average, the measure can present a skewed picture. Imagine 10 people, 9 of them have $10 and one of them has $1,000. Calculating the average cash on hand is easy - $1,090/10=$109. Clearly that is not an accurate accounting of the group. The median and modal values would be $10 - more accurate.  So, back to minimum wage earners - consider the average age of 35 and a working life of 16-65 years of age. There are 19 measurable years between 16 and 35, but there are 30 measurable years between 35 and 65. Because our working life excludes our first 15 years of life, the simple average age of a minimum wage worker would skew "old." Consider how difficult it is to reconcile the average age with this fact: one-third of those earning the federal minimum wage are teens, and just over half of minimum wage earners are under the age of 25. If just over half are 25 of younger it suggests the median age is approximately 24 years old. And one final point, the vast majority of minimum wage earners are not the sole source of income for a family. So suddenly the image of minimum wage earners as single Moms disappears. It is true that about 1/4 of minimum wage earners fall into the category of parents with children - but it's inefficient and poor targeting to implement a 40% wage hike for the 75% of wage earners who are no parents supporting a family just to provide an income boost to 25% - and a recent piece in the Baltimore Sun demonstrated that as a result of the wage hike, many of those in that 25% would lose eligibility for social supports and wind up with less net income.

Would the Inflation Adjusted Wage Really Be over $10 per hour?
The following graph, courtesy of the unbiased folks at Pew, shows that the period from the late 1960s through at least 1981 were an unusually "generous" period for the minimum wage. But the period was far from the norm. If one were to select the late 1940s or the late 1950s as the basis for today's wage in would be far below $10.50, below $10.10, and below the current level of $7.25  - so claims of an inflation adjusted $10 minimum wage are simply disingenuous.  In the end, none of the main arguments for a $10 wage hold up to serious scrutiny.

Should the Wage Be Higher?
There is a case to be made that the inflation-adjusted average wage for the "generous" period should serve as a baseline for the wage moving forward. Without question, a concerted effort was made to increase the purchasing power of the minimum wage throughout the 1960s and 70s before a long slide began in the 1980s through until 2009. Boosting the wage to the 1960s and 70s level would yield a minimum wage for 2015 of approximately $8.40 per hour. If it were then indexed to inflation and automatically adjusted every year thereafter it would no longer go through long periods of decline followed by sudden increases. As result, it would provided some degree of predictability in the value of the wage to workers and the cost of labor to employers.

In a prior post I cited a New York study that estimated a 20% jump in job loss among the young and the unskilled as a result of a 30% hike in the state's minimum wage. Applying those findings to Baltimore City, where unemployment among those aged 16-24 is a devastating 31%, could lead to an unimaginable 37.5% unemployment rate. Beyond Baltimore City youth, the overall unemployment rates in Baltimore City, Washington county in western Maryland, and the counties of the lower Eastern Shore show that significant portions of the state simply could not absorb the job shock likely to be caused by a 40% wage hike.

The Governor and the folks at Raise the Wage estimate that over 500,000 workers would get a raise if the minimum were set at $10.10. With just under 3 million employed workers in the state that amounts to nearly 17%! That represents a significant new cost imposed upon businesses. How can anyone seriously think that employers will not respond by trimming hours, cutting positions, and refusing to hire the young and the less skilled?  How can anyone believe that the state's high unemployment counties will be made better off?

Senate President Mike Miller has been less than receptive to the idea of a $10.10 statewide minimum. He has raised the possibility of allowing counties to set their own wages. Though that is certainly preferable to a statewide minimum of $10.10 per hour, I think a wage of $8.40 per hour, adjusted for inflation thereafter, is the best option for the state (and the country). 

Wednesday, February 5, 2014

The Minimum Wage is a Poor Way to Support Working Families in Maryland

In a prior post, I argued against minimum and living wage schemes on the basis that they harm unskilled laborers and are far less effective than tax schemes like the Earned Income Tax Credit when it comes to targeting the working poor.  As Maryland lawmakers continue to consider a substantial hike in MD's minimum wage, I have been encouraged by the number of folks speaking against the perceived wisdom of such an increase.  Let me be clear, I do not oppose raising the minimum wage. In fact, I think a review of the history of the wage suggests that it should be raised to approximately $8.40 an hour and then indexed to inflation thereafter. But the proposal to make the MD minimum $10.10 by 2016 simply goes too far and would likely have significant negative effects on youth and unskilled employment levels.

In recent commentary, Barry Rascovar discussed the problems with a one-size-fits-all wage approach in a state with very different cost of living standards. Much like myself, Rascovar pointed to the better policy approach f increasing the Earned Income Tax Credit (a negative income tax that supplements the earnings of the working poor - especially those with children). Today, Howard Leathers, an associate professor in the Department of Agricultural and Resource Economics at the University of Maryland, published a piece in the Baltimore Sun in which he outlines the seemingly paradoxical reality that a substantial increase in the minimum wage would reduce net income for a working parent. In the example provided by Leathers, a 59% increase in the minimum wage would actually result in a 3% decline in net income for a working parent. How can that be? The answer is simple, with the higher wages, the low income working parent would pay higher taxes and lose eligibility for crucial social supports such as Food Stamps, subsidies for child care, and housing assistance.

Many may consider it a good thing for people to be more self reliant. In fact, decreased eligibility for social programs would result in less government spending for those programs - in theory. But consider the costs. The decreased government spending would be offset by higher spending by employers as a result of the higher hourly wage. Many of the businesses that pay minimum wage are small businesses with precious little profit margin. Faced with higher wage costs, those businesses would likely increase prices (if the market will allow) and customers would pay more for goods and services. Those businesses are likely as well to reduce their labor costs by reducing their workforce - meaning more unemployed individuals suddenly eligible for social support services. So we'd be left with some workers receiving a higher wage, but many being worse off due to lost benefits. And we'd have more people unemployed and drawing on the social services that the higher wages were supposedly replacing. It's a perverse form of income transfer as the low income workers who lose their jobs transfer their lost income to those who keep their jobs. Then, those who keep their jobs transfer their social service benefits to the newly unemployed.

And make no mistake, a minimum wage hike like that being proposed in Maryland will have a  negative impact on employment. Consider just two recent studies - in the first, professors from Texas A&M University determined "that the minimum wage reduces net job growth, primarily through its effect on job creation by expanding establishments. These effects are most pronounced for younger workers and in industries with a higher proportion of low-wage workers." In other words, businesses respond to higher wages by either not expanding or by hiring fewer employees when then do expand. The second study is the most compelling. Most studies of the employment effects of the minimum wage consider the impact of marginal increases in the wage - increases in the range of 10% or so. Maryland is considering a 40% increase in its minimum wage. Such dramatic increases are rare, and even more rarely studied. New York state implemented a 30% wage increase about 10 years ago and a recently published paper examined the impact of that increase. According to the authors - all college professors with expertise in the matter -  "the NYS minimum wage increase is associated with a 20.2% to 21.8% reduction in the employment of less-skilled, less-educated workers, with the largest effects on those aged 16 to 24."  Their results provide substantial evidence that state minimum wage increases can have significant adverse labor demand effects for low-skilled individuals.

To put the New York study into perspective, consider this - the unemployment rate in Baltimore City for those aged 16-24 is a devastating 31%. That is more than twice the statewide youth rate of 13.4% and nearly double the national rate of 16.1%. Imagine a 21% increase in youth unemployment in Baltimore City. Instead of a devastating 31% we'd see a catastrophic 37.5% rate. That is simply unacceptable - but the empirical data, and Governor O'Malley always claims to be driven by data and not ideology, suggests that a $10 minimum wage would only exacerbate an already out of control unemployment problem in Baltimore. Good luck finding anyone who would argue that a 40% increase in the minimum wage would improve the employment situation in Baltimore City.  The Governor and the folks at Raise the Wage estimate that over 500,000 workers would get a raise if the minimum were set at $10.10. With just under 3 million employed workers in the state that amounts to nearly 20%! That represents a significant cost imposed upon businesses - how can anyone seriously think that employers will not respond by trimming hours, cutting positions, and refusing to hire the young and the less skilled?

I'd like to address as well the issue of income inequality and effective means of targeting the needs of the working poor. Minimum wage laws are indiscriminate and incredibly inefficient policy tools. Is it really a problem if an 17 year old middle class kid living at home earns $7.25 an hour while working at a fast food restaurant? The obvious answer is "no." That kid is not supporting a family and is not trying to "live" on minimum wage. At present, one-third of those earning the federal minimum wage are teens, and just over half of minimum wage earners are under the age of 25. The vast majority of minimum wage earners are not the sole source of income for a family. But employers are not permitted to offer different wages to different employees doing the same job simply based on need (keep in mind, it was once common for employers to pay men more than women for doing the same job based on the notion that men had families to support - today we call such practices discriminatory). Using the minimum wage to target the needs of working families would require employers to pay substantially higher wages to all workers. So in order to provide a $10.10 wage to a working parent with two kids an employer would need to provide that same wage to an upper middle class kid working part time to earn pizza money. That is not sound policy.

I may not care if that middle class kid earns $7.25 an hour, but do I care if a mother or father working one full time or several part time jobs is unable to meet the basic needs of their family. As a policy person, and as someone who believes in "to each according to their need," the question must be - how can we best support that family? The answer is not some misguided one size fits all minimum wage that treats the 17 year old and the single parent as if they are the same. The answer is not a minimum wage hike that effectively lowers the net income of working parents while simultaneously increasing unemployment.

Social support programs such as Food Stamps, child care subsidies, and the earned income tax credit allow society to effectively target need without creating the negative effects of artificially inflated wages. And perhaps of even greater import, these social programs are more effective at addressing inequality. A higher minimum wage simply transfers income between low income workers - those that keep their jobs and those that lose their jobs. But social programs like those listed here effectively transfer income from the well-off who pay income taxes to the less well off who earn too little to pay income taxes.

Those advocating the $10.10 an hour wage like to claim that had the minimum wage in the late 1960ssimply kept pace with inflation the wage today would be well be roughly$10.50 per hour. Unfortunately, those folks are being intentionally misleading.

The following graph, courtesy of the unbiased folks at PEW, shows that the period from the late 1960s through at least 1981 were an unusually "generous" period for the minimum wage. But the period was far from the norm. If one were to select the late 1940s or the late 1950s as the basis for today's wage in would be far below $10.50, below $10.10, and below the current level of $7.25  - so claims of an inflation adjusted $10 minimum wage are simply disingenuous.  That said, there is a case to be made that the inflation-adjusted average wage for the "generous" period should serve as a baseline for the wage moving forward. Without question, a concerted effort was made to increase the purchasing power of the minimum wage throughout the 1960s and 70s before a long slide began in the 1980s through until 2009. Boosting the wage to the 1960s and 70s level would yield a minimum wage for 2015 of approximately $8.40 per hour. If it were then indexed to inflation and automatically adjusted every year it would no longer go throw long periods of decline followed by sudden increases - it would provided some degree of predictability in the value of the wage to workers and the cost to consumers.

The real choice facing lawmakers in Annapolis is not whether or not they should support working families, rather it is how best they can support those working families. I think a wage of $8.40 per hour, adjusted for inflation, is the best option for the state and the country.