Friday, May 26, 2017

It’s All About Trump’s Contempt

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A man in Welch, W.Va., with groceries from a food bank that supports local families, many of them in the coal industry. Credit Spencer Platt/Getty Images
For journalists covering domestic policy, this past week poses some hard choices. Should we focus on the Trump budget’s fraudulence — not only does it invoke $2 trillion in phony savings, it counts them twice — or on its cruelty? Or should we talk instead about the Congressional Budget Office assessment of Trumpcare, which would be devastating for older, poorer and sicker Americans?
There is, however, a unifying theme to all these developments. And that theme is contempt — Donald Trump’s contempt for the voters who put him in office.
You may recall Trump’s remark during the campaign that “I could stand in the middle of Fifth Avenue and shoot somebody and I wouldn’t lose any voters.” Well, he hasn’t done that, at least so far. He is, however, betting that he can break every promise he made to the working-class voters who put him over the top, and still keep their support. Can he win that bet?
When it comes to phony budget math — remember his claims that he would pay off the national debt? — he probably can. We’re not talking about anything subtle here; we’re talking about a budget that promises to “abolish the death tax,” then counts $330 billion in estate tax receipts in its rosy forecast. But even I don’t expect to see this kind of fraud get much political traction.
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The bigger question is whether someone who ran as a populist, who promised not to cut Social Security or Medicaid, who assured voters that everyone would have health insurance, can keep his working-class support while pursuing an agenda so anti-populist it takes your breath away.
To make this concrete, let’s talk about West Virginia, which went Trump by more than 40 percentage points, topped only by Wyoming. What did West Virginians think they were voting for?
They are, after all, residents of a poor state that benefits immensely from federal programs: 29 percent of the population is on Medicaid, almost 19 percent on food stamps. The expansion of Medicaid under Obamacare is the main reason the percentage of West Virginians without health insurance has halved since 2013.
Beyond that, more than 4 percent of the population, the highest share in the nation, receives Social Security disability payments, partly because of the legacy of unhealthy working conditions, partly because a high fraction of the population consists of people who suffer from chronic diseases, like diabetics — whom Mick Mulvaney, Trump’s budget director, thinks we shouldn’t take care of because it’s their own fault for eating poorly.
And just to be clear, we’re talking about white people here: At 93 percent white, West Virginia is one of the most minority- and immigrant-free states in America.
So what did the state’s residents think they were voting for? Partly, presumably, they supported Trump because he promised — falsely, of course — that he could bring back the well-paying coal-mining jobs of yore.
But they also believed that he was a different kind of Republican. Maybe he would take benefits away from Those People, but he would protect the programs white working-class voters, in West Virginia and elsewhere, depend on.
What they got instead was the mother of all sucker punches.
Trumpcare, the budget office tells us, would cause 23 million people to lose health insurance, largely through cuts to Medicaid — remember, the program that benefits almost a third of West Virginians. It would also lead to soaring premiums — we’re talking increases on the order of 800 percent — for older Americans whose incomes are low but not low enough to qualify for Medicaid. That describes a lot of Trump voters. Then we need to add in the Trump budget, which calls for further drastic cuts in Medicaid, plus large cuts in food stamps and in disability payments.
What would happen to West Virginia if all these Trump policies went into effect? Basically, it would be apocalyptic: Hundreds of thousands would lose health insurance; medical debt and untreated conditions would surge; and there would be an explosion in extreme poverty, including a lot of outright hunger.
Oh, and it’s not just about crucial benefits, it’s also about jobs. Coal isn’t coming back; these days, West Virginia’s biggest source of employment is health care and social assistance. How many of those jobs would survive savage cuts in Medicaid and disability benefits?
Now, to be fair, the Trump budget would protect West Virginians from the ravages of the estate tax, which affects around 20 — that’s right, 20 — of the state’s residents each year.
So many of the people who voted for Donald Trump were the victims of an epic scam by a man who has built his life around scamming. In the case of West Virginians, this scam could end up pretty much destroying their state.
Will they ever realize this, and admit it to themselves? More important, will they be prepared to punish him the only way they can — by voting for Democrats?

McConnell May Have Been Right: It May Be Too Hard to Replace Obamacare

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Mitch McConnell, the Senate majority leader, can afford to lose only two Republicans if he is to get a health bill through the Senate Credit Doug Mills/The New York Times
WASHINGTON — Shortly after President Trump took office, Senator Mitch McConnell of Kentucky, the majority leader, met privately with his colleagues to discuss the Republican agenda. Repealing the Affordable Care Act was at the top, he said. But replacing it would be really hard.
Mr. McConnell was right.
The many meetings Republicans held to discuss a Senate health care bill have exposed deep fissures within the party that are almost as large as the differences between Republicans and Democrats. Elements of a bill that passed the House this month have divided Republicans.
Mr. McConnell faces an increasingly onerous math problem. He can afford to lose only two Republicans if he is to get a bill through the Senate, and that would require the help of Vice President Mike Pence, who would have to cast the tiebreaking vote. But at least three senators in the party are diametrically opposed to the views of at least another three, so the path to agreement is narrow.
Republicans are roughly split over whether the expansion of Medicaid under the Affordable Care Act should be rolled back or continued, at least in the short run. They disagree about how the federal government should grant states more control over setting insurance standards. They are also divided over a critical portion of the House bill, which would allow states to obtain waivers from two of the most important federal mandates: a requirement to provide a minimum set of health benefits and a prohibition against charging higher prices to people with pre-existing medical conditions.
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The challenges facing Senate Republicans are so great that overhauling the tax code is starting to look easier by comparison. “I allow that’s a possibility,” said Senator Pat Toomey, Republican of Pennsylvania, who is closely involved in negotiating both issues and favors a rollback of the Medicaid program.
This week, the normally circumspect Mr. McConnell conceded that it was going to be difficult to get the votes needed from Republicans to pass a health care bill. A Congressional Budget Office report on the House bill, forecasting an increase of 23 million Americans without insurance in a decade and significantly higher premiums for older and sick people, bolstered the resolve of Republican senators who have been skeptical of the House effort.
Most Republicans in Congress would like to keep their vow to repeal and replace the Affordable Care Act, but they face a more urgent challenge: to stabilize insurance markets that, in some states, are in danger of melting down next year.
Video

Fact Check: The Updated G.O.P. Health Care Bill

Does the health care bill passed by the House live up to Republicans’ promises? We checked the facts.
By DAVE HORN, NATALIE RENEAU and MARK SCHEFFLER on Publish Date May 25, 2017. Photo by Stephen Crowley/The New York Times. Watch in Times Video »
Every week brings word of insurers seeking big rate increases or announcing plans to pull out of another market in 2018. It is conceivable that the two parties could work together on short-term fixes outside the repeal process at some point.
“I don’t think we want the market to fail,” said Senator Orrin G. Hatch, Republican of Utah and chairman of the Finance Committee, which is responsible for tax legislation and much of the Affordable Care Act. “We don’t want premiums to be so high that people can’t afford them.”
Republicans could pass a repeal measure and return to the health care system that was largely in place before the Affordable Care Act became law. But Speaker Paul D. Ryan, among others, has repeatedly stated that his party has a plan to make the system better, which would require the replacement part of the repeal-replace equation.
With health care negotiations sputtering, many Republicans are quietly turning their attention to changes in the tax code as a possible path for legislative success. Generally, Republicans are more unified around the fundamentals of a tax overhaul than on the details of health policy. The White House team working on tax issues is far less ideological than the team directing health care efforts, and it has worked harder to build early momentum, Republicans aides say.
Though Republicans have been calling for a repeal of the health care law almost since President Barack Obama signed it in 2010, those calls have become more urgent as some of the insurance exchanges have struggled.
But with millions of Americans newly insured under the law, many governors, including some Republicans, are loath to roll it back, and many senators agree. Twenty Republican senators come from states that have expanded Medicaid under the Affordable Care Act.
The House bill, starting in 2020, would sharply reduce federal payments to states to cover those who became eligible for Medicaid as a result of the Affordable Care Act.
The law also has provisions to help drug addicts, and the opioid crisis sweeping many states with Republican senators has been a key motivator.
“The opioid issue definitely plays a role,” said Senator Susan Collins, Republican of Maine. “A lot of the young population that is being insured under Medicaid has problems with substance abuse or mental illness.”
While fixing the nation’s tax code has long been considered even harder than passing health care legislation on Capitol Hill, the opposite could end up being the case.
Treasury Secretary Steven Mnuchin and Gary D. Cohn, the director of the president’s National Economic Council, have held numerous meetings with lawmakers — including Democrats — on the matter and have attended several hearings against the backdrop of the contentious health care talks.
“Taxes has more consensus with Republicans and some Democrats,” said Senator Rob Portman, Republican of Ohio.
Republican senators have been watching closely as House Republicans have twisted themselves in knots over the tax “blueprint” that they released last summer. Many lobbyists and tax experts are hoping that the Senate emerges as a voice of reason.
Republican senators continued free-flowing conversations among themselves this week to analyze their options and search for consensus on a health care bill that they said would be significantly different from the one passed by the House.
Senator John Cornyn of Texas, the majority whip, and Senator Ron Johnson of Wisconsin said they expected staff experts to draft legislative language for Republicans to consider when the Senate returns from a weeklong recess on June 5.
“We’re talking about this nonstop between ourselves,” Mr. Johnson said of the Republicans. “It’s an appropriate time now to have leadership and committee staff, working with leadership and committee chairmen, sit down and draft a bill, a proposal, for discussion.”
If the Senate decided not to vote on a health care bill, it would be likely to enrage the White House, as it did when Mr. Ryan at first failed to produce a bill that could pass. However, Mr. Trump has considerably less leverage with Mr. McConnell than he did over House leaders, as Mr. McConnell and Republican senators are less susceptible to pressure from the White House.

Wednesday, May 24, 2017

Monday, May 22, 2017

Lack of Workers, Not Work, Weighs on the Nation’s Economy

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Juan Guerrero, right, and Joseph Waseme securing materials on a truck bed at a Roofers Supply lot in Salt Lake City. The company needs at least 15 more drivers to meet demand, but has had trouble finding workers. Credit Kim Raff for The New York Times
SALT LAKE CITY — Stephanie Pappas and her brothers built their roofing supply company in this fast-growing region by promising next-day delivery, but lately they’ve been forced to tell some customers that tomorrow is impossible.
Their company, Roofers Supply, employs 28 drivers across Utah, and Ms. Pappas said she would need at least 15 more to meet the exploding demand for shingles and tiles. The company has raised its starting wage by 10 percent since the beginning of the year to $17.50 an hour, but it’s not enough.
“We never want to have to say, ‘We can’t do it,’ but we need people,” Ms. Pappas said.
After eight years of steady growth, the main economic concern in Utah and a growing number of other states is no longer a lack of jobs, but a lack of workers. The unemployment rate here fell to 3.1 percent in March, among the lowest figures in the nation. Nearly a third of the 388 metropolitan areas tracked by the Bureau of Labor Statistics have an unemployment rate below 4 percent, well below the level that economists consider “full employment,” the normal churn of people quitting to find new jobs. The rate in some cities, like Ames, Iowa, and Boulder, Colo., is even lower, at 2 percent.
That’s good news for workers, who are reaping wage increases and moving to better jobs after years of stagnating pay that, for many, was stuck at a low level. Daniel Edlund, a 21-year-old call center worker in Provo, Utah, learned Monday that his hours were changing. On Wednesday, he had his first interview for a new job.
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“I’m trying to find a company that treats you well,” he said.
But labor shortages are weighing on overall economic growth, slowing the pace of expansion in northern Utah and other fast-growing regions even as unemployment remains stubbornly high in Rust Belt cities like Cleveland and in regions still recovering from the 2008 recession, like inland California.
To Todd Bingham, the president of the Utah Manufacturers Association, “3.1 percent unemployment is fabulous unless you’re looking to hire people.”
“Our companies are saying, ‘We could grow faster, we could produce more product, if we had the workers,’” he said. “Is it holding the economy back? I think it definitely is.”
President Trump continues to promise that he will accelerate job growth by cutting taxes and regulations. But the accumulating evidence that workers are getting harder to find, and that wages are rising more quickly, has convinced many economists that significantly faster growth is unlikely. The Federal Reserve has cited the trend as its reason for moving to wind down its own economic stimulus campaign. The Fed may raise interest rates again at its next meeting in June.
Qualtrics, which conducts online market research, is a prime example of the rapid growth of the Utah economy — and the sense that Utah is straining at the limits of its growth potential. Scott Smith started the company with his son, Ryan, and a college classmate in his Provo home in 2002. Qualtrics now employs 1,300 people, including about 800 in a new headquarters building opened in August at the mouth of Provo Canyon. And it is bringing workers to Utah as fast as it can.
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Griffin Miller, a Qualtrics employee, at the company’s new headquarters in Provo, Utah. Credit Kim Raff for The New York Times
Each Monday, the company ties red balloons to the desks of that week’s batch of new employees. Last week, there were several dozen of those balloons. The parking lot outside the new headquarters building is already overstuffed, including many cars that still have out-of-state plates.
Ryan Smith, now the chief executive, said Qualtrics had hired about three dozen graduates from the University of Michigan alone last year. The company estimates that new arrivals bought 100 homes in Provo last year.
Utah’s tech scene is growing alongside the company. More local university students are studying engineering; more start-ups are popping up in the region, which boosters would very much like everyone to call “Silicon Slopes.” But by the end of the year, Mr. Smith said, he expects the company will have more employees outside Utah than in its home state. It is growing where it finds workers.
Companies in Utah, as in the rest of the country, were slow to raise wages in recent years. At first there were plenty of available workers. But by the end of 2015, a report by Utah’s Department of Workforce Services concluded that inadequate wages had become a key reason companies were struggling to find employees.
“It was as if employers hadn’t adjusted their approach to the labor market” as the economy recovered, said Carrie Mayne, the department’s chief economist.
Now there are signs the logjam is breaking. Adam Himoff, the president of Xemplar Skilled Workforce Solutions, a recruiting firm hired by Roofers Supply to find drivers, said he had seen an increase this year in the willingness of clients to raise wages.
“Labor has become the constraint on their growth goals, and they’re recognizing that they’re going to have to increase wages to achieve what they want to achieve,” he said.
Ms. Mayne said the state also saw signs of what she described as a broad-based acceleration in wages in the most recent data, through the end of last year.
But the share of Utah adults who have withdrawn from the labor force remains higher than before the recession. Last year, 31.7 percent of adults in Utah were neither working nor looking for work, up from 28.2 percent in 2006. That is part of a broad national trend.
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Leo Tapia operating the milking machine at Gibson’s Green Acres Dairy in Ogden, Utah. In less lucrative industries such as agriculture, labor shortages may remain an intractable problem. Credit Kim Raff for The New York Times
And a 3.1 percent unemployment rate still means that about 50,000 people in Utah were trying to find jobs in March.
Some, like Monica Von Strahl, expect to find work quickly. Ms. Von Strahl, 44, moved to Utah from Oregon in April for family reasons. She left a job as a caregiver for adults with disabilities that paid $16 an hour; so far, the most she has been offered in Utah is $10 an hour. She plans to keep looking a little longer. (Scholars at M.I.T. estimate that a living wage in Utah for a single person is $10.71 an hour.)
But even in a red-hot market, some of the people who are looking for work struggle to find the right fit. Noel Nampijja, 42, left her job as a nurse’s aide two months ago because the work of moving patients was hurting her back. She just completed training as a phlebotomist, a medical assistant who draws blood.
“I’m hoping to find a job that won’t hurt as much,” she said.
In less lucrative industries, labor shortages may remain an intractable problem.
Ron Gibson, a fifth-generation dairy farmer, tends 1,500 cows on family land outside Ogden. Last month, he placed an ad in local papers seeking three workers at wages starting around $12 an hour. It did not draw any responses.
Mr. Gibson cannot afford to chase workers by raising wages. The price of milk, adjusted for inflation, is lower now than in the 1980s. Instead, he is producing less milk. Each cow is milked three times a day; only 15 percent get a fourth milking.
He also laughed at the idea that Americans might move from other states to milk cows in Utah. He relies primarily on immigrant labor, communicating with his two dozen workers in the Spanish he learned as a young Mormon missionary in Argentina. And since Mr. Trump’s election, he said, workers are harder to find.
“We are either going to import workers or we are going to import milk,” Mr. Gibson said.
The work “is dirty, stinky and hard,” he added. “It’s not what we teach our young people to do.”
But there is another solution on the horizon: automation. Last year, Mr. Gibson and his son visited a farm in upstate New York where robots milk cows. The cows learn to approach the machines when their udders are full.
Mr. Gibson is not yet ready to make the jump. Each machine costs half a million dollars, and the New York farmer spends about as much on mechanics as he spent on farmhands. But Mr. Gibson said he expected his children would use robots to milk cows.

White House Moves to Block Ethics Inquiry Into Ex-Lobbyists on Payroll

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Walter M. Shaub Jr., the head of the Office of Government Ethics, in January. The White House has challenged Mr. Shaub’s authority to demand information on former lobbyists now working for the government. Credit J. Scott Applewhite/Associated Press
The Trump administration, in a significant escalation of its clash with the government’s top ethics watchdog, has moved to block an effort to disclose any ethics waivers granted to former lobbyists who have work in the White House or federal agencies.
The latest conflict came in recent days when the White House, in a highly unusual move, sent a letter to Walter M. Shaub Jr., the head of the Office of Government Ethics, asking him to withdraw a request he had sent to every federal agency for copies of the waivers. In the letter, the administration challenged his legal authority to demand the information.
Dozens of former lobbyists and industry lawyers are working in the Trump administration, which has hired them at a much higher rate than the previous administration. Keeping the waivers confidential would make it impossible to know whether any such officials are violating federal ethics rules or have been given a pass to ignore them.
Mr. Shaub, who is in the final year of a five-year term after being appointed by President Barack Obama, said he had no intention of backing down. “It is an extraordinary thing,” Mr. Shaub said of the White House request. “I have never seen anything like it.”
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Marilyn L. Glynn, who served as general counsel and acting director of the agency during the George W. Bush administration, called the move by the Trump White House “unprecedented and extremely troubling.”
“It challenges the very authority of the director of the agency and his ability to carry out the functions of the office,” she said.
In a statement issued Sunday evening, the Office of Management and Budget rejected the criticism and instead blamed Mr. Shaub, saying his call for the information, issued in late April, was motivated by politics. The office said it remained committed to upholding ethical standards in the federal government.
“This request, in both its expansive scope and breathless timetable, demanded that we seek further legal guidance,” the statement said. “The very fact that this internal discussion was leaked implies that the data being sought is not being collected to satisfy our mutual high standard of ethics.”
President Trump signed an executive order in late January — echoing language first endorsed by Mr. Obama — that prohibited lobbyists and lawyers hired as political appointees from working for two years on “particular” government matters that involved their former clients. In the case of former lobbyists, they could not work on the same regulatory issues they had been involved in.
Both Mr. Trump and Mr. Obama reserved the right to issue waivers to this ban. Mr. Obama, unlike Mr. Trump, automatically made any such waivers public, offering detailed explanations. The exceptions were typically granted for people with special skills, or when the overlap between the new federal work and a prior job was minor.
Ms. Glynn, who worked in the office of government ethics for nearly two decades, said she had never heard of a move by any previous White House to block a request like Mr. Shaub’s. She recalled how the Bush White House had intervened with a federal agency during her tenure to get information that she needed.
Ethics watchdogs, as well as Democrats in Congress, have expressed concern at the number of former lobbyists taking high-ranking political jobs in the Trump administration. In many cases, they appear to be working on the exact topics they had previously handled on behalf of private-sector clients — including oil and gas companies and Wall Street banks — as recently as January.

Document

Letter to Office of Government Ethics

The White House, in an extremely unusual move, asked the Office of Government Ethics to hold off on its investigation into ethics waivers granted to ex-lobbyists and industry lawyers.
OPEN Document
Mr. Shaub, in an effort to find out just how widespread such waivers have become, asked every federal agency and the White House to give him a copy by June 1 of every waiver it had issued. He intends to make the documents public.
Federal law gives the Office of Government Ethics, which was created in the aftermath of the Watergate scandal, clear legal authority to issue such a “data request” to the ethics officers at federal agencies. This is the main power the office has to oversee compliance with federal ethics standards.
It is less clear whether it has the power to demand such information from the White House. Historically, there has been some debate over whether the White House is a “federal agency” or, as it calls itself, the “executive office of the president.” Such an office might not be subject to oversight.
The White House, however, tried on Wednesday to stop the process across the entire federal government, even before most agencies had responded to Mr. Shaub’s April 28 request.
“This data call appears to raise legal questions regarding the scope of O.G.E.’s authorities,” said the letter, which was sent to Mr. Shaub by Mick Mulvaney, the head of the Office of Management and Budget. It continued, “I therefore request that you stay the data call until these questions are resolved.”
The letter, which was obtained by The New York Times after a Freedom of Information request, created confusion among federal agency heads about whether they should honor the request from the ethics office.
Norman Eisen, the top White House ethics lawyer in the first years of the Obama administration, said he believed that the Trump administration was trying to intimidate federal ethics officers, who are career appointees, without actually ordering them to ignore the directive from the ethics chief.
“It is yet another demonstration of disrespect for the rule of law and for ethics and transparency coming from the White House,” Mr. Eisen said.
Mr. Shaub, in a conference call with federal government ethics officers on Thursday, told them that he had the clear authority to make such a request and that they were still obligated under federal law to provide the requested information, according to a federal official who participated in the call.
The Office of Government Ethics, however, does not have the power to take enforcement action directly against the agencies if they do not respond. Traditionally, if it has trouble getting the information it needs, it turns to the White House to get compliance, Ms. Glynn said.
“The agency is more or less dependent on the good graces of the party that is in power,” she said.
Tensions between Mr. Trump and Mr. Shaub first started to grow in late November, when the Office of Government Ethics sent out an unusual series of Twitter messages urging Mr. Trump to limit potential conflicts of interest by selling off his real estate assets. Mr. Shaub then gave a speech in January, after Mr. Trump announced that he would not take such a step, which was highly critical of the incoming president, provoking speculation that Mr. Shaub might be fired before his term ended.
“One of the things that make America truly great is its system for preventing public corruption,” Mr. Shaub said during that speech. “Our executive branch ethics program is considered the gold standard internationally and has served as a model for the world. But that program starts with the office of the president. The president-elect must show those in government — and those coming into government after his inauguration — that ethics matters.”

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