One Big Fat Serving Of Crow, Please

Our old friend Minnesota Republican Tom "Waitresses make $100k a year!" Emmer has apparently taken a lot of heat for his idiotic comments last weekend about how Minnesota should cut base wages on servers to $2.13 and credit them for tips, since apparently they make six figures a year.  This of course pissed off pretty much the entire state, and now Emmer is in full spin mode trying to get out of this hole he's in.  TPM's Eric Kleefeld:

Whatever the economic merits of the policy might be, what really got Emmer in trouble was this quote, the substance of which he attributed to a restaurateur who was hosting the event in question: "With the tips that they get to take home, there are some people earning over $100,000 a year. More than the very people providing the jobs and investing not only their life savings but their families' future." Emmer's claim that wait staff were making six-figure salaries did not play well in the media.

Emmer tried to backtrack by posting a statement on his website, declaring that his proposal would not actually affect workers' wages at all: "I want the wait staff at a restaurant to be successful and make as much as they can, and a recent study published in Applied Economics Letters shows that tip credits have essentially no negative impact on wages for tipped employees. So contrary to what some people are saying, I have no interest in 'cutting wages.'"

The Star Tribune published an editorial with the fitting title, "Tip to Emmer: Drop gratuity idea." Of his insistence that economic forces would result in workers' pay remaining the same, they said: "The result is a contradictory message with a cynical aftertaste. Emmer appears to be telling business owners that he wants to do them a favor at their workers' expense. Then he tells those same workers: Don't worry. Your employers will discover they can't really lower your pay, no matter what state law says."

Meanwhile, the restaurant owner involved said that he had received hateful phone calls over the matter. He also insisted that he never actually told Emmer that his staff members were making over $100,000, and that Emmer's quote itself was "manipulated." It should be noted that the Star Tribune's reporter stands by the quote, saying that it is in on tape -- and that Minnesota Public Radio separately reported Emmer saying the same thing.

In his press release announcing the listening session with servers, Emmer said: "This week we met with business owners and next week we will listen to the employees, especially servers concerned about the tip credit issue. I'm looking forward to a robust discussion."

Sure you are.   I wouldn't hold a luncheon at the robust discussion, otherwise you're going to get about half a pound of "free condiments" in your meal courtesy of the servers you think are overpaid.

Emmer made a classic mistake, like all Tea Party assholes who have no real clue how to make America better for anyone but asshole politicians, Republicans like Emmer don't have any actual ideas, only an increasingly large list of people who need to be blamed for destroying America.  The problem with this is that you constantly have to make the list larger in order to generate continual outrage.  Emmer in this case played the "I choose to redefine group X as the outsider who is ruining the country", in this case "servers".

And so with one fell swoop, the people who bring Emmer his food became The Other, defined out of the class of "Real Americans Like Us" and into "One Of Those People", people that have to be hated and shunned so that you feel okay in demanding they have their wages cut in order to help The Ultimate Group Of Real Americans, small business owners.  Now, demonizing American workers is fine in the Teabagger Handbook as long as the workers are A) government employees, B) union employees, or C) jobs that Americans believe are mostly filled by minorities.  Any combination of the two is gold, any one you can call all three on is diamond-encrusted platinum.  Inner-city school teachers?  History's greatest monsters, apparently.

But Emmer's problem is he started picking on a non-unionized private-sector job that's been experienced by quite a number of Americans of all walks of life at some point in their lives.  I've done it.  My family members have done it.  There's nothing wrong with working for tips as a server or delivery driver.  But...you don't make $100k a year doing this, even at the nicest of restaurants...even if you are the best waitress at the Hooters in the Mall of America.  Emmer, like all Teabaggers, is trying to distract hard working Americans from the fact that in Emmer's view, you should be hating people who live off the gratuity of others and don't really provide much of a service in return.

You know, politicians.  Now he's trying to plead stupid.

Only one problem, asshole.  There's video.



If you think Republicans like Emmer give a good goddamn about Americans who work for a living, you're out of your mind...and you deserve politicians who will cut your wages as soon as look at you.

You have a nice day next time you eat out there, Tom.

You Want Fiscal Responsibility? Let The Bush Tax Cuts Expire

As Zero Hedge regular madhedgefundtrader points out, all Obama has to do to fix the deficit is...nothing.

Out of a current projected budget deficit of $1.3 trillion, $700 billion, or 54% comes from the Bush era tax cuts, $320 billion (25%) from a tax revenue fall off caused by the Great Recession, $200 billion from the wars in Iran and Iraq (15%),  and $50 billion (4%) is generated by Obama’s recovery measures. The TARP and the bailout of Fannie Mae and Freddie Mac are so small, they don’t even register on the chart. All of the angst, complaining, moaning, blustering, and carping is about the 4%.

You often see this in politics, where the debate gets focused on where the problem isn’t, not where it is, and is a big reason why I’m not in that business. Markets have a fascinating way of seeing straight though this impenetrable fog. So while the noise out of Washington is trying to convince us that these deficits are ruinous, the ten year Treasury bond yields we saw yesterday at a stunning 2.97% are telling us that, in fact, they are no problem at all, and that the government can now borrow nearly infinite amounts of money at the lowest interest rates in history.

There are some other really interesting things that this chart and the bond market are telling us. The Bush tax cuts expire next year, and a recovering economy will bring a return of tax revenues, eliminating 79% of the deficit. The scheduled withdrawal from Iraq next year will cut another 7%. This assumes that Obama is unable to get a single additional piece of legislation through the congress, a distinct possibility if he loses control of congress in November.

This is the writing on the wall the bond market is attempting to focus our blinkered eyes on. If anyone else has another set of believable numbers that reaches a different conclusion, I am all ears. 

So sure, if Republicans are serious that we have to get rid of deficits, they they will let the Bush tax cuts expire.  And if Obama is serious about it, he won't lift his pen to sign any sort of extension on them.  Bam, we lose a huge chunk of deficit and get back on track.

What's that you say?  There's no way on God's green Earth that Obama will let this happen?  Why not?  According to Republicans, Obama's already doomed as a one term President anyway, and the Republicans will control Congress until the End of Time Itself.

What does he have to lose by letting Bush's tax cuts, the single largest contributor to our deficit, expire?

It's A Nuclear Melt-Up, Part 3

Today's lousy market news, the weekly ECRI Leading Indicators Index dropped to -8.3%.  Keep in mind that every time this Index has hit the negative double digits or below, we have had a recession follow 100% of the time.  At the worst parts of the most recent crisis, the index hit a low of -29.7 in December 2008.  It then rocketed upwards to +28.4% last October as stimulus was fed in to stoke the fires.  It has dropped like a rock in the last 3 months.  The odds of a second recession, or more accurately the second leg of the depression, are close to 100% now.

Naturally, stocks closed up for the day and 5%+ for the week on virtually no volume.  It's the eerie calm before the sky turns green and the F5 tornado drops out of the sky.

Assume the position, folks.

Perpetrating Acts of Actual Journalism

Dana Milbank's piece on the Arizona immigration debate (out early on the WaPo site)  is an important read.

Jan Brewer has lost her head.

The Arizona governor, seemingly determined to repel every last tourist dollar from her pariah state, has sounded a new alarm about border violence. "Our law enforcement agencies have found bodies in the desert either buried or just lying out there that have been beheaded," she announced on local television.

Ay, caramba! Those dark-skinned foreigners are now severing the heads of fair-haired Americans? Maybe they're also scalping them or shrinking them or putting them on a spike.

But those in fear of losing parts north of the neckline can relax. There's not a follicle of evidence to support Brewer's claim.

The Arizona Guardian Web site checked with medical examiners in Arizona's border counties and the coroners said they had never seen an immigration-related beheading. I called and e-mailed Brewer's press office requesting documentation of decapitation; no reply.

Brewer's mindlessness about headlessness is just one of the immigration falsehoods being spread by Arizona politicians. Border violence on the rise? Phoenix becoming the world's No. 2 kidnapping capital? Illegal immigrants responsible for most police killings? The majority of those crossing the border are drug mules? All wrong. 

If this sounds familiar to readers, that's the reason why this is an important story. I mentioned it last Friday when TPM's Rachel Slajda reported the story back on July 1.  As Dana does point out, this all happened back at the end of June.  Only now is the Village paying attention to the idea that Jan Brewer is lying her ass off in order to try to scare Arizonans into supporting her little "papers, please!" law.  Milbank does find the larger point, however:

This matters, because it means the entire premise of the Arizona immigration law is a fallacy. Arizona officials say they've had to step in because federal officials aren't doing enough to stem increasing border violence. The scary claims of violence, in turn, explain why the American public supports the Arizona crackdown.

Last year gave us death panels and granny killings, but compared with the nonsense justifying the immigration crackdown, the health-care debate was an evening at the Oxford Union Society. 

You think?  Only took you Village assholes what, a couple of months to figure out that this was all a plan to target all Latinos, to play the race card, to suppress the Latino vote in November and to fire up the GOP base with yet another scapegoat they can blame?

It's important that somebody up there has finally put two and two together.  Milbank of course dings John McCain for the same lies, but tosses blame for that back on Brewer (which explains a few things) but the fact of the matter is this should have been said back in May, and the people whose job it is to say it once again dropped the ball and even worse, advanced the lies both Brewer and McCain told without challenging them...until only now.

And there's a real problem with that.

A Little Story About Jack And Rand

Democrat Jack Conway and Republican Rand Paul went at it last night in Louisville in separate speeches at the Senate Candidate's Forum, and it was an interesting show to say the least.

In their first joint appearance of the general election campaign, Republican Rand Paul and Democrat Jack Conway took jabs at one another Thursday and sought to more sharply define their differences in the race for the U.S. Senate.

Speaking in Louisville before an overflow crowd of county officials, Paul, 47, a Bowling Green ophthalmologist, said Conway is "just too liberal" for most Kentuckians.



He linked Conway to President Barack Obama, who he said wants to raise taxes and expand government.
"He will have to distance himself from his president and his party if he wants to have any chance," Paul said of Conway.

Conway, 40, the state's attorney general, said voters shouldn't be scared by Paul's rhetoric. And he repeated a campaign pledge to take back for his party the seat of former Sen. Wendell Ford, now held by Republican Jim Bunning, who is not seeking a third term.


"I know people are pessimistic," Conway said. "I know people are angry. We need to get address our problems and get serious about solutions."


More than 300 county judge-executives, magistrates and commissioners filled the room for the forum -- held at the Downtown Marriott -- in which each candidate got 20 minutes to speak and five minutes to respond to his opponent's comments.


Officials who attended said afterwards they were impressed by the event.

Something you may or may not know about Kentucky politics, and that's "too liberal for Kentucky" is defined as anything to the left of, say, Mitch McConnell.  The state has long been happy with local Democrats like Gov. Steve Beshear, and national ones like Mitch and people go with that.

Keep in mind Jack Conway would be a moderate Republican in nearly any other state, too.  Liberal in Kentucky means "You believe in evolution".  If Conway keeps trying to swing to the right, he's going to lose to Rand Paul.

Rocks To The Left Of Him, Hard Places To The Right, Here He Is

President Obama is stuck in the middle with Eric Holder and the Justice Department.  On one hand he's stated flatly that he wants to see Congress repeal the Defense Of Marriage Act, and on the other hand, the Justice Department is obligated to defend the act in court.

It follows then that anyone who thought that the Obama DoJ woudn't appeal yesterday's decision to strike down part of DOMA as unconstitutional simply wasn't living in reality.

The gay rights law group that convinced a federal district court judge Thursday to strike down a federal ban on gay marriage has told the New York Times they "fully expect" the Justice Department to appeal the decision -- a move that could shatter Obama's image in the gay community and cost his party millions of dollars in donations from gay donors.

"Lawyers on various sides of the issue said it was a certainty that the government will appeal and likely that the cases will reach the Supreme Court," Politico added Friday.

Such an appeal would be filed by the Obama-appointed US Attorney Carmen Milagros Ortiz, who was confirmed last November by the Senate.

In an email Friday, a White House spokesperson told Raw Story, "This is a question for the Justice Department."

"The only comment I have is the Department is reviewing the decision," Tracy Schmaler, a Justice Department spokesperson, told Raw Story shortly after.

Evan Wolfson, director of the gay rights group Freedom to Marry, said he doesn't know what the Justice Department will do, but hopes that if they appeal, they will couch their filing carefully.

"I think we're going to have to see what the Justice Department decides," Wolfson said. "I do hope that, if there is an appeal, that at a minimum the administration will agree that the appellate court should apply a presumption of unconstitutionality -- which in legal terms is called heightened scrutiny -- to this law that they concede is discriminatory."

"My message [to Obama] would be: Do the right thing," Wolfson added. "You agree this law is discriminatory. A highly respected conservative Republican-appointed judge has now said it's unconstitutional. Stop enforcing this unfair and discriminatory law that harms families and helps no one."

And yes, Obama will take plenty of heat for this from the LGBT community and the people who support and agree with the view that DOMA is discriminatory garbage, because DOMA is discriminatory garbage.  However, Obama is President of the entire United States of America, so he's obligated to defend any law on the federal books impartially as the Chief Executive, and that means referring the law to the DoJ for an appeal.

Obama appeals, he's going to rightfully get excoriated by the LGBT community.  He does nothing, he's going to get it from the Republicans and the Village instead.  It's an ugly situation, but Obama put himself there by refusing to take a stand on this.  Now he can't play both sides of the fence as a pragmatist, and he's going to have to make a decision.

I'm absolutely sure he's going to proceed as if the decision has already been made for him and that he will direct the DoJ to appeal.  This matter will end up before the Supreme Court and soon.

Exciting New Horizons In Obama Derangement Syndrome

A new Democracy Corps poll finds 55% of likely American voters now believe Barack Obama is a socialist.

The poll (PDF) from Democracy Corps finds that 55 percent of likely voters believe that the word "socialist" describes the president either "well" or "very well."

Peyton Craighill, a senior associate at Greenberg Quinlan Rosner, a firm that does polling for Democracy Corps, attributed the surprising number to voters' impatience with the lagging economy.

"It probably has to do with the fact that people are very unhappy with the dire economy and the fact that the budget deficit is quite large," Craighill said. "People who don't like the man are going to use any label they can to ding him, even if they don't think he's a socialist in the vein of the Soviet Union or China."

June's poll was the first Democracy Corps survey to ask respondents if they consider the President to be a socialist, but Craighill said the monthly poll will continue to ask the question in the future. "It's something we want to track on future reporting for how this might relate to the Tea Party movement," he said. Craighill expects Democracy Corps to publish a report specific to the Tea Party movement in a few weeks.

Personally, I'm convinced of two things:

One, Americans wouldn't know an actual socialist from one of those styrofoam pool floats, they are calling him "socialist" because the word a lot of the people want to use to describe him is not polite to use in public.  It's a code phrase, like "young buck", "welfare queen", and John McCain's famous debate phrase "that one."  They know it.  You know it.  I know it.  Let's be honest here.

Two, I'm calling the over/under on that "report specific to the Tea Party movement" on what percentage of them say the word socialist describes Obama well or very well as 90%, proving point one as well as just how ignorant people are about political systems in general.

Obama Derangement Syndrome.  It's working all too well.  Perhaps the President should consider, you know, doing something about this 9.5% unemployment rate.  Like, now.

The Kroog Versus The After Action Report

Paul Krugman is getting mopey to the point of being emo (emo-conomist?) but I'm pretty much right there with him on this mess we're in.  It really is that grim.

How did things end up this way? We’ll never know whether the administration could have passed a bigger plan; we do know that it didn’t try.

He's got a point.  It is right to rail at the Republicans for opposing the stimulus at nearly every turn.  It is also right to rail at Obama for not having the political will to do what was necessary.  They got what stimulus they could, yes.  We should all be thanking them for that.  The sin was convincing themselves that the stimulus, as it was, was 100% adequate to tackle the problem  (this especially goes for the almost complete failure of the administration's mortgage relief program) and that they had slain the dragon.

Nothing could have been further from the truth.  Kroog continues:

Those concerns were what had me fairly frantic in early 2009: I was terribly afraid that the failure of an inadequate stimulus to bring unemployment down would end up being seen as a refutation of the whole idea of stimulus — which is exactly what happened. And by the way, the reason I was for temporary bank nationalization was that it would make it possible to recapitalize banks quickly, and get them lending, which would help make up for the weak stimulus; what happened instead, of course, was gradual recapitalization through profits, with banks not doing much lending along the way.

And here we are. From a strictly economic point of view, we could still fix this: a second big stimulus, plus much more aggressive Fed policy. But politically, we’re stuck: even if the Democrats hold the House in November, they won’t have the votes to do anything major.

I’d like to say something uplifting here; but right now I’m feeling pretty bleak.

Not going to happen.  If anything, we're about to take steps that will almost certainly require us to take even more drastic steps to fix it:  turning on Helicopter Ben's Printing Press at 110% speed.  Keep the phrase "gargantuan quantitative easing" in the back of your mind.

And yes, I'm talking about countering a deflationary death spiral with a hyper-inflationary orbital satellite cannon with a whole hell of a lot of zeroes after it.  Overdoing it on the austerity is going to cripple us.  Overdoing it on the stimulus is going to murder us.

As I said, inflation, major deflation, hyper-inflation.  We're smack in the middle of step two.

Wisconsin Knows How To Paaaaaaar-tay

Especially the Tea Party.  Meet Ernie Pagels, the most off the hizzook playa in the land!
Ernest J. Pagels Jr. is a long shot contender for the Wisconsin GOP Senate primary, vying for the opportunity to run against Sen. Russ Feingold (D) this September. And perhaps there’s a reason. Pagels recently ran an ad on a local Milwaukee television station outlining what he plans fight for as one of Wisconsin’s two U.S. senators:

PAGELS: Hi my name is Ernest J. Pagels Jr., I’m a born again Christian, a U.S. veteran and a very conservative Republican. I’m running for U.S. Senate from the state of Wisconsin and if elected I will initiate a bill to outlaw homosexuality, abortion, and all forms of pornography. I think these are three ills that are plaguing our nation and bringing it down. And if elected, I will also initiate a bill for a Constitutional amendment which prohibits Congress and the President from spending more money than they bring in. My name is Ernest J. Pagels, Jr. and I hope you vote for me on September 14.

No, seriously.  This guy right here.



Teapublicans. The Party of Hell No You Can't.

But hey, at least he's being honest about having no ideas on how to fix our economy and is running solely on a platform of ruining everyone else's day and being a bigoted asshole, right?

House Of Really, Really Nice Cards, But Cards Nonetheless

Guess which group of people is defaulting on their mortgages at a higher rate than anyone else, subprime, prime, or jumbo?  If you said "Well it has to be subprime, those people never should have gotten mortgages in the first place" then I have a tale to spin for you, friend.

No need for tears, but the well-off are losing their master suites and saying goodbye to their wine cellars.

The housing bust that began among the working class in remote subdivisions and quickly progressed to the suburban middle class is striking the upper class in privileged enclaves like this one in Silicon Valley.

Whether it is their residence, a second home or a house bought as an investment, the rich have stopped paying the mortgage at a rate that greatly exceeds the rest of the population.

More than one in seven homeowners with loans in excess of a million dollars are seriously delinquent, according to data compiled for The New York Times by the real estate analytics firm CoreLogic. 

By contrast, homeowners with less lavish housing are much more likely to keep writing checks to their lender. About one in 12 mortgages below the million-dollar mark is delinquent. 

Though it is hard to prove, the CoreLogic data suggest that many of the well-to-do are purposely dumping their financially draining properties, just as they would any sour investment.

“The rich are different: they are more ruthless,” said Sam Khater, CoreLogic’s senior economist. 

Just because you're wealthy doesn't mean you can't make a bad investment, and buying a million-dollar home at the market peak and then seeing that value drop to say, $600,000 in a couple of years is a really, really bad investment.  The difference is these are folks who often have other assets and can walk away from it and recover.  The folks who have 90% of their total wealth tied up in a home that has lost 30% of its market value since 2007, those are the ones in real trouble.

And it's not like enterprising souls can trade up to these cheaper McMansions because they can't sell their existing homes to free themselves up, and if they did, they'd take a similar percentage hit on the home their are trying to sell to trade up.

It's not poor minorities walking away from their homes here at nearly twice the national average, folks.

In The Miami Heat Of The Cleveland Night

Best and Worst post-LeBronathon analysis:  The Atlantic's Josh Green, who argues that his exit from Ohio on national TV just handed the Buckeye State over to the Tea Party.

I've spent the week traveling around Texas, particularly the Gulf area southeast of Houston, whose residents have been hit hard by the offshore drilling moratorium, the end of the Space Shuttle, and its successor program, Constellation. At the Fourth of July parade I attended in Friendswood, near the Johnson Space Center, the economic dislocation was palpable. Everybody worried that jobs were leaving and not coming back, so their kids would leave, too. NASA's decline in particular--Obama's space policy would end the agency's manned flights, a source of tremendous local pride--was upsetting to everyone, because the whole area was about to lose its identity.

There were four tents on the parade concourse with political themes: Republican, Democrat, Tea Party, and Glenn Beck's 9-12 outfit. The first two were nearly empty; the latter two were jammed with people, so I hung out there talking to them. They were angry about a lot of stuff, but the unifying theme was their feeling that they were on the losing end of things, and to hell with the system that had put them there.

Back to Ohio. The unemployment rate is well above the national average, nearly 11 percent. The state's manufacturing base has been decimated, and those jobs aren't coming back. And now, suddenly, the biggest star in the state -- an economic engine in his own right, and a guy who probably single-handedly made Cleveland a recognizable sports mecca all over the world -- has forsaken its residents. And not just forsaken them, but utterly humiliated them by forsaking them on a globally televised ESPN Special!

Would you be angry? I sure would be. And I'd be that much more amenable to the Tea Party message that everything is going to hell.

Yeah, let that sink in.  LeBron leaving Ohio for Florida is going to tip the state into the Red column?  Really?  Three thoughts on that.

1)  Polite response:  That seems like a rather pointed insult to the people of Ohio if you ask me.  There are real problems in not just Ohio's economy but all over the tri-state (also relative, that includes the Cincy IN-KY-OH tri-state, the Cleveland PA-WV-OH tri-state, and the Toledo IN-MI-OH tri-state areas) and people have bigger problems to worry about.

2)  Cynical response:  LeBron pantses Ohio on national TV, it's got to be Obama's fault, right?  That's a bit of a reach. Smacks of Obama Derangement Syndrome to me.  Quelle surprise to find this in The Atlantic.

3)  Really Somewhat Angry response:  So you're basically saying "Hey Ohio, this is the second really famous black man who screwed you over in the last 18 months", huh?  You, uh, really want to go down that particular road there, Josh?

At least he admits in the column that it's ridiculous to read too much into LeBron.  I agree.  Of course, it didn't actually stop Josh Green from going there, but there you are.

StupidiNews!

• Hundreds took to the streets of Oakland after yesterday's verdict of involuntary manslaughter in the trial of a white transit officer who killed an unarmed black man.
• The Obama administration has lost its appeal of the six month moratorium on offshore drilling in a 2-1 appelate court decision.
• Florida Gov. Charlie Crist wants to put a state constitutional ban on all offshore drilling on the ballot in November.
• After entering guilty pleas on being unregistered foreign agents, the deported Russian spy ring busted last month is being traded for four convicted US spies.
• LeBron James is headed for the Miami Heat rather than the Cleveland snow.