At the end of last week, Sen. Jim Bunning (R-KY) and the Senate Republican caucus decided to take a stand on government spending by demanding that Congress offset an important tax extenders bill. The bill, which, among other things, sought to extend eligibility for unemployment benefits, COBRA premium assistance, a Medicare doctors' fix, and highway funding, failed to pass because of the GOP's intransigence. While offsetting spending is a sensible policy, this was hardly the appropriate moment to make a point on the issue, as blockage of the extension bill will likely have serious consequences for both jobless Americans and our weak, recovering economy.

Created through the American Recovery and Reinvestment Act (ARRA), four tiers of federal unemployment benefits currently cushion out-of-work Americans that have exhausted their state unemployment insurance. The filing deadline for these federal benefits expired yesterday. It now seems that the Senate is going to try to pass a longer extension of eligibility for these benefits in a new jobs bill, but this, of course, will take time. While senators debate this next bill, some 400,000 jobless Americans will lose their unemployment insurance over the next two weeks, according to the Department of Labor.

Failure to pass the extension also forced the Department of Transportation to furlough nearly 2,000 federal inspectors today because the government ran out of money to pay them. As a result, a number of highway construction projects have gone on hiatus, stranding some 90,000 construction workers employed on those projects. Additionally, physicians that see patients on Medicare will, beginning today, see benefits reduced by 21 percent, and jobless Americans that rely on COBRA to provide their health care coverage will lose a 65 percent subsidy to help pay for the insurance.

Fallout within the wider economy from Sen. Bunning and the GOP's blockage of this extension could be serious. Just the loss of unemployment benefits to jobless Americans – who generate $1.90 in gross domestic product for every dollar of unemployment insurance spent – might send a significant shock through the nation's recovering economy. Add to that the loss of health coverage for the unemployed and the stalling of federal construction projects around the country and the effects multiply.

Standing on the floor of the Senate, Sen. Bunning tried to defend his actions by arguing that if senators couldn't find $10 billion to pay for the extension bill, "we will never pay for anything," and that the debt we currently face is "unsustainable." Neither of these statements hold up to scrutiny.

The Senate just instituted new pay-as-you-go (PAYGO) rules that, while not as robust as earlier statutory rules, require the upper chamber to offset future spending increases or tax cuts with corresponding spending cuts or revenue increases. Given Bunning's argument about offseting, one would assume that he was a supporter of PAYGO. One would be wrong, though. Bunning voted against the very law that he now vehemently supports. Moreover, what does the unsustainability of our long-term deficits have to do with a short-term $10 billion unemployment insurance extension? If Sen. Bunning is interested in finding a spending cause célèbre, he should look into decrying extension of the Bush Tax Cuts or Medicare Part D, which will add tens of trillions of dollars to our debt.

The bottom line is that the actions of Sen. Bunning, which the Senate GOP leadership have de facto supported and are continuing unabated, are indefensible. With unemployment benefits for millions of American workers hanging in the balance, this was hardly an appropriate moment to take a moral stand on federal spending.

Image by Flickr user Der Henk used under a Creative Commons license.

Yesterday morning, Rep. Jan Schakowsky (D-IL) and Sen. Bernie Sanders (I-VT) held a press conference to announce the reintroduction of legislation to phase out the government's use of private security contractors in war zones. The Stop Outsourcing Security Act, which Schakowsky and Sanders originally introduced in 2007, seeks to prevent contractors in war zones from performing "mission critical or emergency essential functions," including security, military and police training, interrogation, and intelligence.

During the press conference, Sanders explained the rationale for the bill thusly:

I believe that it is wrong and extremely dangerous for private companies to perform mission critical functions in the field of war. Private contractors do not operate within the traditional military chain of command. They are not subject to the same rigorous standards of vetting and training as are members of our armed forces. Most importantly, ... the function of a private corporation is to make as much money as possible, not to serve the best interests of the people of the United States or our policies.

Sen. Sanders hits the nail on the head. Time after time after time, private security contractors in Iraq and Afghanistan have shown their inability to perform mission critical functions up to the military's standards by engaging in questionable conduct that severely damages the image of the United States abroad. Just as appalling, the offenders, more often than not, escape without sufficient reprimand, if they receive punishment at all. These events, both the abhorrent conduct and the lack of consequences, are even more harmful in the context of a counterinsurgency effort wherein the military is trying to protect and win over a foreign populous.

Phasing out security contractors, though, will likely prove a difficult task, both legislatively and logistically. Legislatively, the government contracting industry, especially the defense contracting industry – within which most security contractors reside – is an exceptionally powerful lobbying force. Faced with essentially the demise of their industry, the security contracting community, represented by influential groups such as the Professional Services Council and the Orwellian-named International Peace Operations Association, will fight tooth and nail against this bill.

Logistically, the government employed, at last count, roughly 22,000 security contractors in Iraq and Afghanistan. That's a lot of personnel, and while the legislation grants the federal government until the end of the year to replace all security contractors and permits the president a temporary waiver for agencies that can't make the transition deadline, it would be difficult for the government to ramp up hiring to fill those positions that fast. Indeed, the Defense and State departments have gradually transitioned to the use of contractors mainly because they didn't have an adequate number of personnel to carry out their missions to begin with and they view security contractors as a cost-effective substitute.

Reintroduction of the outsourcing bill comes at a propitious moment for Schakowsky and Sanders, as the Senate Armed Services Committee held a hearing this morning to investigate charges of corruption against Blackwater/Xe, an infamous security contractor. Whether the increased attention to this issue will help boost the bill's chances of passage is debatable, but one would think that security contractors could create only so many high profile foreign policy headaches for the United States before Congress stepped in to cut them off. With that said, the first time Schakowsky and Sanders introduced their bill in 2007 they had the Nisour Square massacre providing impetus, but the bill never progressed beyond the committee level in either the House or Senate.

The use of contractors in war zones is nothing new. The United States has used contractors even before the inception of the country in the days of the American Revolution, but the unprecedented expansion of security contractors, both in their numbers and the roles that they play, is dangerous for the U.S. Even if the government finds it impossible to move beyond the use of security contractors in the wars in Iraq and Afghanistan, I believe it's important for Congress to at least set down a set of policies for future contingency operations.

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With the arrival of the one-year anniversary of the Recovery Act, experts and pundits alike are reviewing how the Obama administration's stimulus effort has stacked up thus far. Despite what some in Congress say and in contrast to how the public generally feels, it turns out the Recovery Act has worked pretty well and has been quite a successful piece of public policy.

One of the more convincing pieces on this issue was an article this morning in the New York Times by David Leonhardt, who laid out all the facts and effectively showed how the Recovery Act has created jobs and helped to turn the economy around. Leonhardt didn't use the administration's own data to make the point, rather he relied on outside evaluations from industry analysts from financial houses such as HIS Global Insight, Macroeconomic Advisers, and Moody's.

According to their estimates, the stimulus bill has saved or created between 1.6 million and 1.8 million jobs, and may save or create up to 2.5 million by the end. What's more, the Congressional Budget Office (CBO) – the non-partisan accounting wing of Congress – claims these estimates are conservative.

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Source: New York Times

That's not to say that the Recovery act has been flawless. Problems were both structural – too much money went to tax expenditures and not enough went to infrastructure projects – and operational – because some prime recipients falsely reported their congressional districts, it looked like the government was spending money in fictional places. But the stimulus has received much less in the way of celebration compared to detriment, and that's mostly because it's so hard to prove a negative.

It's easy for the White House to say, "Here's a job" to an unemployed worker, but it's a little more difficult for the administration to tell a worker going through hard economic times that they'd really be up the creek without a paddle if it hadn't been for the stimulus effort. Moreover, the Obama administration's optimistic analysis of the economy when assuming office really put the Recovery Act in a bind.

Detractors claim that the stimulus bill didn't work because unemployment went above 10 percent and the White House claimed it wouldn't go above eight. But the high unemployment figures aren't proof that the Recovery Act didn't work, they're proof that the economy was worse than originally thought, and the stimulus has kept the country from degrading into a scene out of Mad Max Beyond Thunderdome.

Of course, the economy isn't recovered yet, and, because the effects of the first stimulus bill will evaporate around the middle of this year, Congress needs to move on a second stimulus soon. The problem is that the conventional wisdom around Capitol Hill is that the country can't afford a second effort, and the Senate has already significantly pared down the House's fairly aggressive jobs bill passed in late December. With a new "jobless era" hanging over our heads, I would argue that the country can't afford not to have a second stimulus.

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It seems old Dick Patten at the American Family Business Institute (AFBI) is up to his old tricks again, trying to scare people about the estate tax with lies and distortions in an attempt to gin up support to kill the tax in Congress. This time, though, he's adopted pious language to spread the gospel of the "evils" of the tax among religious conservatives.

In a recent article, Rebecca Foerg-Spittel over at Campus Progress, a project of the Center for American Progress, details the interesting press conference Patten headed up last week at the offices of the conservative Family Research Council (FRC). During the event, according to Foerg-Spittel, Patten "weaved a strange and tenuous web among business, church, and social structure" in an attempt to portray the estate tax as a tool government uses "to take things away from 'us' (Read: evangelical Christian family business owners) – property, spirituality, and a way of life."

After quoting scripture to portray one's inheritance as a "sacred right," the AFBI executive director really goes out on a limb:

According to Patten, the original Hebrew word for inheritance refers to both spiritual and physical inheritance. Thus, when the government takes away from one’s physical inheritance, it takes away from a sort of spiritual inheritance as well.

And to drive home the point to his FRC audience, Patten claimed – I'm not kidding – "Sixty percent of family businesses are owned by evangelical Christians." Foerg-Spittel did a little fact checking and, big shock, couldn't find any published data to support Patten's claim.

Foerg-Spittel also amply dissects the anti-estate tax argument in her piece:

The right claims both that the tax is a needless attempt to prey on one’s lifelong earnings, and that it is particularly severe on small business, but given that the estate tax only kicks in for inheritances over $3.5 million, the right's argument that this is a populist cause becomes more tenuous.

She's absolutely right, in fact, Citizens for Tax Justice released its latest report in December detailing the effects of the estate tax and concluded that only 0.7 percent – less than one percent – of estates faced any estate tax liability in 2008. Because estate tax exemption levels increased from $2 million in 2008 to $3.5 million in 2009, the percentage of estates facing tax liability in 2009 will be even lower.

Patten may believe that he can incite a Third Great Awakening with his calls to defeat the "evil" estate tax, but his arguments are so hackneyed and boilerplate that they don't get past even a mild amount of scrutiny. Of course, that's never stopped him before.

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