Editorial Cartoon: Quicksand deficit


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Israel’s budget deficit soars


Israel’s budget deficit for 2012 was more than double the government target, coming in at 4.2 percent of Gross Domestic Product (GDP). In addition, debt is 74 percent of GDP, making economic growth in Israel difficult.

“I think the average Israeli should be very concerned,” Professor Omer Moav, an economist at the University of Warwick in London and Hebrew University, told The Media Line. “The deficit is about $10 billion, which means more than $5,000 per Israeli household. We will have to pay it back – we, our children and our grandchildren.”

The announcement of the deficit came just over a week before Israel’s national election and quickly became a campaign issue.

“Over and over again Netanyahu sets deficit targets that he is unable to meet,” sniped Labor party leader Shelly Yacimovich, who hopes to lead her party to the number two slot after Netanyahu. “In the meantime he is digging a deep hole that he plans to fill with the decreasing funds of the poor and middle class.”

Moav says that Israel’s cost of maintaining its debt is relatively high because Israel pays higher interest rates.

“Israel is a risk economy,” he said. “The political risks and security risks translate into higher interest rates.”

Israel also spends an estimated 6.5 percent of GDP on defense, one of the highest percentages in the Western world. Combine that with the fact that large sectors of Israel’s population – the ultra-Orthodox and the Arab citizens of Israel – have significantly lower employment rates. Those who do work often have low salaries and do not pay taxes, meaning that those who do pay taxes pay more.

Economists here say Israel must cut its spending and increase its tax collection to pare down the debt burden. They say that the Israeli economy is not yet in crisis but it is moving in that direction.

“We are losing our flexibility,” Eyal Kimhi, the Deputy Director of the Taub Center for Social Policy Studies in Israel and a professor at Hebrew University, told the Media Line. “Unemployment here is pretty good, and the economy is still growing although slowly. But Israel will have to increase spending to counter the slowdown and then the deficit will increase even more.”

As that happens, Kimhi says, Israel will find it harder to raise the credit to cover the deficit, and the country will have to spend even more on interest payments.

The 2013 budget will be the first item on the new government’s table after the elections. Current Prime Minister Benjamin Netanyahu is expected to form the next government with a series of coalition partners. The problem, many say, is that each partner comes with its own set of political and economic demands. Perhaps for this reason Netanyahu may prefer a coalition with centrist parties, rather than the ultra-Orthodox, who make financial demands that could increase the deficit even further.

Palestinian Authority blames Gaza for deficit mess


Paying for the upkeep of the Gaza Strip while its political rival actively blocks revenues flowing back is taking its toll on the deficit-racked Palestinian Authority.

The Western-backed PA, many of whose top leaders belong to the mainstream Fatah movement, says it has poured around $7 billion into the Gaza Strip since its rival Hamas seized control in 2007, but complains that the Islamist group is stymieing its efforts to balance its books.

A barrage of mutual accusations in recent weeks has driven Hamas and Fatah ever further apart as stalled efforts at reconciliation and economic stagnation have jangled nerves on both sides.

Crippling power cuts in the small coastal enclave have only added to the acrimony and lifted the lid on often opaque Palestinian funding.

The PA says it spends $120 million a month, or more than 40 percent of its whole budget, on salaries and services in Gaza despite being driven out in a brief civil war with Hamas five years ago, anxious to show the world that despite the political divisions, the Palestinians remain one people with a single administrative core.

The PA, which continues to exercise limited self-rule in the Israeli-occupied West Bank, has never recognized Hamas’s rule in the Gaza Strip and still pays wages to former PA personnel in the enclave.

Israel maintains a tight blockade on the Gaza Strip with the help of neighboring Egypt.

“In return Hamas does not pay for any of the needs of the people in Gaza. On the contrary, it sells the medicine that we send for free, and keeps the money,” said Ahmad Assaf, a Fatah spokesperson in the West Bank.

Hamas denies this and says the PA is just funneling foreign donations ear-marked for the Palestinian people.

“Vital sectors like education and health do not get support from them … except for bits and pieces that arrive as donations from some countries,” Hamas spokesperson Sami Abu Zuhri said.

The PA, which relies overwhelmingly on foreign donor aid, mostly from the European Union, the United States and Arab nations, is facing a projected $1.3 billion deficit in 2012.

Although most Western countries shun Hamas over its refusal both to renounce violence and recognize Israel, they let the PA use their aid cash to help the Palestinians in Gaza.

The EU says it contributed 837 million euros ($1.1 billion) to the PA since 2008, 34 percent of which went to the Gaza Strip to cover civil servants’ salaries and pensions.

“According to our information, the Hamas government only pays for the salaries of their employees and for their security apparatus,” said an EU official, who declined to be named.

“We are convinced that we must continue paying this money because we know that if we didn’t the Hamas government would do nothing,” Fatah’s Assaf said.

Hamas has tried to build up its own finances by attracting funds from its own foreign allies, such as Iran, while looking to impose a taxation code of its own on trade and business within Gaza.

But analysts say it too faces a budget crunch and is far from ready to take care of Gaza’s 1.7 million-strong population, some 70 percent of whom live below the poverty line, according to U.N. statistics.

“Hamas wants to portray itself as being independent financially from the PA,” said Naser Abdelkarim, a professor of economics at Birzeit University in the West Bank.

“But that’s a myth. If the PA stops transferring money to the Strip, the reality in Gaza would deteriorate instantly.”

Hamas agrees it wouldn’t pay all the PA salaries, but says that’s because most of the people concerned don’t do any work after Fatah instructed its civil servants not to cooperate.

Another crucial issue for the PA is the taxes it should be collecting from Gaza. It says Hamas and Gazan traders systematically under-report the value of their imports to the Israeli authorities, which collect custom dues on behalf of the PA, costing the PA $400 million in “tax leakage” since 2007.

Palestinian Authority Prime Minister Salam Fayyad said Gaza raised 2 percent of all Palestinian tax returns in 2011 against 28 percent in 2005.

Hamas’s economy minister, Ala al Rafati, admitted the group was withholding some $95 million in custom tax forms that the PA needs in order to collect revenues and would continue to do so until the PA agreed to wire the money straight back to Gaza.

“These invoices have not been sent to Ramallah since the split,” al Rafati told Reuters by telephone from Gaza.

Palestinians’ long-running hope of founding a state incorporating both the West Bank and Gaza, territories divided by Israel, has often papered over feuds between rival factions.

The arguments over finances have come out into the open partly because of a fuel crisis that has left much of the enclave without power for several hours each day since early February, sparked by Egypt’s decision to clamp down on the flow of fuel smuggled into Gaza via a network of tunnels.

Critics of Hamas say it is at fault for the emergency for relying so heavily on cheap, illicit fuel, rather than working with the PA to secure alternative supplies.

The PA says it pays more than $50 million a month to an Israeli energy company that feeds power into Gaza, but Hamas refuses to hand over money from electricity bills.

“We have repeatedly asked Hamas to transfer the money they collect so that we can continue to provide them with fuel. But nothing gets sent,” said Omar Kittaneh, the head of the PA Power Authority.

The PA admits that nothing is going to change fast. As with many of the issues that bedevil Palestinian politics, the two sides are stuck in a rut.

“Contributing a large part of the PA budget to the Gaza Strip has become the status quo and this will not change any time soon,” said PA spokesman Ghassan al Khatib.

Additional reporting by Nidal al-Mughrabi in Gaza; Editing by Crispian Balmer and Sonya Hepinstall

Obama pushes $447 billion jobs plan


U.S. President Barack Obama laid out a $447 billion jobs package of tax cuts and government spending on Thursday that will be critical to his re-election chances but he faces an uphill fight with Republicans.

With his poll numbers at new lows amid voter frustration with 9.1 percent unemployment, Obama said in a high-stakes address to Congress that the United States is in a “national crisis” and called for urgent action on sweeping proposals to revive the stalled economy and avert another recession.

“Those of us here tonight can’t solve all of our nation’s woes,” Obama said in a nationally televised prime-time speech. “But we can help. We can make a difference. There are steps we can take right now to improve people’s lives.”

Taking aim at Republicans who have consistently opposed his initiatives, Obama said it was time to “stop the political circus and actually do something to help the economy.”

Obama, who pushed through an $800 billion economic stimulus package in 2009, said his jobs plan would cut taxes for workers and businesses and put more construction workers and teachers on the job through infrastructure projects.

“It will provide a tax break for companies who hire new workers and it will cut payroll taxes in half for every working American and every small business,” he said.

Obama is seeking to seize the initiative in his bitter ideological battle with Republicans, ease mounting doubts about his economic leadership and turn around his presidency just 14 months before voters decide whether to give him a second term.

Obama wants Congress to pass his “American Jobs Act”—which administration officials said would cost $447 billion—by the end of this year and offset the cost with deficit cuts.

But a deal may be hard to achieve with politicians already focusing on the presidential and congressional elections in November 2012.

If Obama can push through his plan, it might provide an economic boost quickly enough for him to reap political benefits. If it stalls in a divided Congress, his strategy will be to blame Republicans for obstructing the economic recovery.

“RIGHT AWAY”

Obama said his proposed plan would “provide a jolt to an economy that has stalled and give companies confidence that if they invest and hire there will be customers for their products and services.”

“You should pass this jobs plan right away,” he said in a speech interrupted by applause from his fellow Democrats while Republicans sat mostly in silence.

Obama proposed extending unemployment insurance at a cost of $49 billion, modernizing schools for $30 billion and investing in transportation infrastructure projects for $50 billion.

But the bulk of his proposal was made up of $240 billion in tax relief by cutting payroll taxes for employees in half next year and trimming employer payroll taxes as well.

Obama also said he was seeking to broaden U.S. homeowners’ access to mortgage refinancing in a plan to help the ailing housing market and put money back in the pockets of borrowers needing help locking into record low interest rates.

How much of the jobs package is viable remains in question. Almost all of it ultimately depends on winning support from Republicans who control the House of Representatives.

Bipartisan cooperation could be hard to come by in Washington’s climate of political dysfunction where a bruising debt feud this summer brought the country to the brink of default and led to an unprecedented U.S. credit downgrade.

But Obama insisted that “everything in here is the kind of proposal that’s been supported by both Democrats and Republicans—including many who sit here tonight—and everything in this bill will be paid for. Everything.”

Republicans will still be resistant, not wanting to give Obama a helping hand before the election. But they will be under pressure to cede some ground to help boost the economy or risk a voter backlash in 2012.

Obama’s choice of a rare joint session of the House and Senate, a setting better known for the president’s annual State of the Union address, was intended to lend ceremonial pomp to a critical speech and push Republicans to cooperate.

But it also carried the risk of raising public expectations that will be hard to meet.

Obama’s speech has taken on new urgency after the latest Labor Department report showed zero employment growth in August, stoking fears of a slide back into recession.

The pressure on Obama to act is driven not just by a spate of dismal economic data but by his own increasingly grim approval ratings now languishing around 40 percent, the lowest since he took office in January 2009.

An NBC/Wall Street Journal poll showed Obama was no longer the favorite to win next year’s election.

Additional reporting by Laura MacInnis, Jeff Mason, Doina Chiacu, Tim Reid, Tom Ferraro, Alister Bull and David Lawder; writing by Matt Spetalnick, Editing by John O’Callaghan

Marty Kaplan: The Monsters Are Due on Maple Streets


The power has gone out in a typical American town.  Wait—it’s not just the electricity.  The phones don’t work, either.  Portable radios are dead.  Cars won’t start. 

But then lawn mowers and cars and lights inexplicably start and stop on their own. What’s going on?  A meteor?  Sunspots?  Or are there, as Tommy’s comic book suggests, aliens among us, preparing for a takeover? Suspicion poisons the air. Neighbor turns on neighbor. A scapegoat is blamed. A shot is fired.  Panic, madness, riot.

And while the humans behave monstrously, the real monsters watch from a nearby hilltop, working a little gizmo that messes with the power on Maple Street and marveling how easy it is to manipulate these earthlings into destroying themselves.

In what is arguably the best “Twilight Zone” episode ever, “” target=”_hplink”>declared their willingness to return to the table and negotiate a shared sacrifice. The monsters are on Wall Street, where state pension funds were sunk into toxic sub-prime mortgage-backed securities.  The monsters are on K Street, where lobbyists are fighting financial industry oversight. The monsters are the politicians who are using Wisconsin’s deficit as a pretext to ” target=”_hplink”>so be it” language of their leadership, you’d think that the federal deficit is caused by the very people who who’ve been suffering the most in this recession.

But the monsters aren’t low-income ” target=”_hplink”>health insurance to cover them; or ” target=”_hplink”>Pell Grants; or people who think their government’s job includes preventing their air and water from ” target=”_hplink”>billionaires who’ve benefited from a massive transfer of wealth from the middle to the top and whose political puppets protect them from paying their fair share of taxes.

They’re the corporations whose cash has convinced Congress to deregulate industry after industry, despite all evidence that it is the enforcement of rules – not the magic of the marketplace—that protects the public’s rights.

They’re the defense contractors and pork appropriators who’ve used the cover of “national security” to shield the Pentagon’s budget and its procurement process from the cuts and reforms that even Republicans like the Secretary of Defense are advocating.

They’re the front groups and propagandists, like FreedomWorks and Fox, who use class warfare and culture wars in order to turn Americans against their own economic interests.

They’re the Supreme Court justices whose Citizens United decision, overthrowing a century of settled law, has made our campaign finance system an open sewer, and whose indifference to ” target=”_hplink”>coming case promises to throw sick people back onto the tender mercies of insurers and to destroy our best hope to curb Medicare costs – further ballooning the deficit and providing cover for even more draconian cuts.

The game in Washington is to use the deficit as camouflage for destroying government’s capacity to promote the general welfare.  The game in Wisconsin and other states whose new Republican governors and legislative majorities are feeling their oats is to shelter the income of the wealthiest, and to balance the budget on the backs of the middle class. 

At the end of the episode, Rod Serling says this:  “The tools of conquest do not necessarily come with bombs and explosions and fallout. There are weapons that are simply thoughts, attitudes, prejudices to be found only in the minds of men.  For the record: Prejudices can kill, and suspicion can destroy, and a thoughtless frightened search for a scapegoat has a fallout all of its own—for the children, and the children yet unborn.  And the pity of it is that these things cannot be confined to the twilight zone.”

Sometimes it’s hard to watch the news and not think that things are surreal.  The other day, when what’s been happening in Madison reminded me of what happened on “Maple Street,” I suddenly realized the theme music that goes with it.

Marty Kaplan is the Norman Lear professor of ” target=”_hplink”>USC Annenberg School for Communication & Journalism.  Reach him at martyk@jewishjournal.com.

Fiscal conservative ISO tax and spend liberal


The chickens, having come home, roost


Budget Crisis Stirs Organizations’ Fears


The stakes for Jewish groups in the Capitol Hill budget crisis are increasing by the day as lawmakers and the administration try to figure out where to find hundreds of billions of dollars for Iraq, Afghanistan and New Orleans, without exploding an already huge federal deficit.

“Every year, they take a little more, and we have to do more with less,” said an official with one Jewish group. “The question isn’t whether there will be disruptive cuts this year; it’s how big and how disruptive the cuts will be, and how long we can go on, trying to pare back services.”

In recent weeks, congressional conservatives, rebelling against what they say is the Bush administration’s deficit disregard, have upped the ante in a budget “reconciliation” push that will preoccupy legislators for the next few weeks.

Republican leaders, who this summer called for $35 billion in cuts to “mandatory” programs such as Medicaid and food stamps, have added another $15 billion in cuts to their demands in the wake of Hurricanes Katrina and Rita. They are also calling for a 2 percent cut in appropriated spending, which covers everything from education to law enforcement. At the same time, they are continuing to insist on up to $70 billion in additional tax cuts, which they say are needed to spur the economy.

However, Democrats say new tax cuts will just increase the deficit and add to the pressure for cuts that could devastate critical health and social service programs.

In the wake of the Gulf Coast disaster, “this is the worst possible time to cut the safety net for people at the bottom, while cutting more taxes for people at the top, and at the same time adding at least $20 billion more to the deficit,” said Thomas Kahn, Democratic staff director for the House Budget Committee.

A number of religious and social action groups agree. Recently, the Coalition on Human Needs, citing the images of desperate poverty on the streets of New Orleans, distributed a letter calling on Congress to “not just delay such service cuts and tax cuts — it must abandon them.”

Several Jewish groups, including the Union for Reform Judaism, the Jewish Council for Public Affairs, the anti-hunger nonprofit Mazon and the National Council of Jewish Women, signed on.

The new budget pressure is coming mostly from the Republican Study Conference, a faction that has gained influence since the departure of Rep. Tom DeLay (R-Texas) as majority Leader. GOP discipline has broken down, congressional sources say, and the conference, which represents the most conservative members of the House, has gained power — with potentially big consequences for the budget.

“The right is under rebellion on both the deficit and the Miers nomination,” said Marshall Wittmann, a senior fellow with the Democratic Leadership Council, referring to the fierce reaction from some conservatives to the recent nomination of White House Counsel Harriet Miers to the Supreme Court. “They feel they’ve been ignored and abused by both the leadership and the White House; these proposed cuts are part of that new dynamic of pressure from the right.”

Jewish leaders say privately that the pressure is all the greater because Democrats — critical of the tax cuts and the growing deficit, but unwilling to cut defense spending or propose tax hikes — haven’t come up with viable alternatives.

The most Draconian cuts are unlikely this year, Wittmann said, because of resistance from Senate moderates and an outcry from governors — Democratic and Republican — about big, new Medicaid cuts. However, he warned that the budget crisis is real and getting worse.

“This is just the first act,” he said. “For Jewish groups, there should be caution and anxiety, but no panic.”

Jews Divided on Security Aid

One appropriation supported by some Jewish groups, but a source of anxiety to others, has cleared Congress.

Just before fall recess, lawmakers finished work on a Homeland Security appropriations bill that includes renewal of a $25 million fund to help vulnerable nonprofit organizations enhance security in the face of terrorist threats. That includes Jewish schools, community centers and synagogues, which is why the Orthodox Union and the United Jewish Communities worked hard for the groundbreaking appropriation last year.

However, other Jewish groups, including the Religious Action Center of Reform Judaism and the Anti-Defamation League (ADL), argue that the measure sets a dangerous precedent for giving taxpayer money to sectarian institutions. They also say the relatively small amount — the $25 million covers all vulnerable nonprofits, not just religious institutions — doesn’t justify the constitutional risk or the risk houses of worship will become involved in political squabbles over funding.

This year’s appropriation was changed somewhat. Now, money will be allocated by the Department of Homeland Security, not state and local officials. That came after concerns that politics played a role in the distribution of some of the money last year.

The Orthodox Union praised the congressional action, saying in a statement that “the American Jewish community deeply appreciates Congress’ recognition of the current security challenges confronting our community’s institutions, including synagogues and schools, alongside other nonprofits.”

Nathan Diament, the group’s Washington director, thanked key sponsors, including Sen. Arlen Specter (R-Pa.), Sen. Barbara Mikulski (D-Md.), Rep. Harold Rogers (R-Ky.) and Rep. Eric Cantor (R-Va.).

Pat Robertson “Helps” Miers

Conservatives are deserting President Bush on his nomination of White House Counsel Harriet Miers to the Supreme Court, but at least one leader of the Christian right is standing tall: the Rev. Pat Robertson, the television evangelist and former Republican presidential hopeful.

However, some of Robertson’s recent comments — like his suggestion this summer that the United States should assassinate Venezuelan President Hugo Chavez and his comments suggesting Hurricane Katrina was divine retribution for abortion — may cause the beleaguered president even more trouble.

Last week, Robertson, speaking on his popular “700 Club” television program, punctuated his strong support for Miers with a historical comparison. In warning Republicans not to reject Miers, he noted that many GOP lawmakers had voted for Justice Ruth Bader Ginsberg in 1993.

Robertson referred to Ginsberg’s former role as general counsel for the American Civil Liberties Union and said that “now they’re going to turn against a Christian who is a conservative picked by a conservative president and they’re going to vote against her for confirmation? Not on your sweet life if they want to stay in office.”

Robertson did not mention the fact that Ginsberg is Jewish, but some Jewish leaders saw ominous hints of an inappropriate religious test in his comments — especially since other supporters of the Miers nomination have been touting her evangelical Christianity in trying to put down the rebellion from some conservative quarters.

Abraham Foxman, national ADL director, warned against using religious identification and faith as a talking point in the confirmation debate.

“I think we’re crossing lines all over the place,” he said. “Now, religion comes up in all kinds of skirmishes. It’s dangerous; it bodes ill for a basic idea of the social contract that has worked so well for this country: advancement by merit, not faith.”

 

Jewish Groups Stay Silent on Tax Cuts


 

For many Jewish activists, the dilemma is excruciating: Congress and the administration are debating a revolution in American life, but Jewish organizations, with rare exceptions, have been struck dumb.

For a variety of reasons, including a lack of consensus within key organizations, most Jewish groups are sitting out the battle over the big tax cuts that are already dramatically reshaping federal spending policies and priorities.

Jewish groups haven’t abandoned the fight for social justice, and they will lobby hard to retain funding for specific social, health and education programs as Congress launches a new crusade against runaway deficits. But that may be a case of fighting yesterday’s battles, as the politicians try to change the ability of the government to raise money tomorrow.

The tax debate has been going on since President Bush launched his first term four years ago with a full-court press for big tax cuts, which he said were urgently needed to spur a sagging economy.

Those cuts were enacted, and according to most measures, the economy has improved. That suggests, the GOP says, the need to make the old cuts permanent and enact new ones.

Economists are divided on the impact of these tax cuts in spurring growth, but one fact is hard to dispute: The federal deficit has ballooned, from the 2000 surplus to the $400 billion-plus deficit projected for the current fiscal year. About half the current deficit is the result of tax cuts, many analysts say, with the other half stemming from the costs of fighting two wars and a global battle against terrorism.

The questions facing lawmakers are these: Will reducing taxes, especially during a time of war, spur the economy enough to offset the loss in revenue? Will more tax cuts be a prudent investment in the American future, or will they cripple the government’s ability to meet the needs of its most vulnerable citizens?

Many Jewish leaders are deeply worried about the answers. With deficit pressure mounting, they fear that “discretionary” spending — including most health, welfare, education and social services programs — will be sliced to the bone in the next few budget cycles.

But even draconian cuts in discretionary spending won’t solve the deficit problem. The only answer, some conservatives believe, is to break into entitlements like Social Security and cut programs and benefits currently deemed untouchable.

That, some Democrats charge and some Republican leaders admit, is the underlying goal of enacting big tax cuts, despite escalating military costs: to use the deficit emergency to force cuts in entitlements that have previously been protected, and perhaps even eliminate programs conservatives have long despised.

Partial privatization of Social Security, many critics believe, is less an effort to save the venerable system for new generations than a ruse intended to undermine the concept of Social Security as an entitlement, the first step to opening it up for big cuts.

Republicans say more tax cuts and partial Social Security privatization will produce big economic gains and open the door to the “ownership society” advocated by the president. Democrats say it’s all a scheme to force the biggest-ever rollback in government social and health programs.

The stakes are enormous, but most Jewish groups won’t be part of the debate. Many Jewish leaders say the reason is simple: a lack of consensus within their organizations about the right course for the economy and the nation.

That answer is true, to a point, but it also is meant to blur what some activists say is a growing gap between the Jewish rank and file and its communal leaders — generally more affluent and more conservative.

There is also a political calculation; some Jewish leaders are worried about opposing a grudge-holding administration (actually, all administrations hold political grudges) on its top domestic priority.

Then there’s the Israel factor. If Jewish leaders oppose the administration’s tax cuts, will the White House punish Israel? The fear is probably unjustified, but it’s one of the excuses being given for inaction.

Whatever the reasons, this deafening communal silence means that as fundamental changes to American society are being debated, the Jewish community will not have much of a voice.

Many Jewish activists are already planning intensive campaigns to protect key government spending programs that Jewish groups around the country depend on to provide vital health and social services.

But a handful of leaders, including Rabbi David Saperstein of the Religious Action Center of Reform Judaism, argue that the changes under way in Washington today are so sweeping, that those targeted efforts will prove ineffective unless the Jewish community also addresses the issue of the big tax cuts that will dominate the budget mix.

Fighting to save individual programs without talking about the tax question may be too little, too late as the real fight shifts from the question of who gets what to the question of how much is left to give, Saperstein said.

The Jewish community will not be united on the answers. But if it isn’t involved in the debate, it will be in no position to complain about the results.

 

Record Gridlock Good for Liberals


Stalemate has become standard operating procedure for Congress in recent years, but this year’s legislative gridlock could be headed for the record books. That’s a source of frustration for Jewish activists across the political spectrum — but also of guilty relief for some.

Important bills have little chance of moving forward in a session marred by election year politics and a new, venomous partisanship. But for liberal Jewish groups, the clogged congressional arteries also mean a partial respite from the conservative onslaught.

Still, no Jewish group takes any joy in a legislative tangle that blocks good legislation and bad and keeps Congress from dealing with a host of long-term problems that are just getting worse as lawmakers quibble.

The reasons for the current gridlock are many, but they can be boiled down to a few basic ones, starting with the rancorous, uncompromising mood of the congressional leadership. In the age of Michael Savage and Rush Limbaugh, you don’t debate and find the middle ground, you maul.

In the House, the GOP leadership has made almost no effort to reach across party lines to the Democrats. Things are hardly any better in the Senate, where the traditional collegiality is now just a memory.

One particularly graphic example: Senate Majority Leader Bill Frist (R-Tenn.) recently traveled to South Dakota to campaign against his Democratic counterpart, minority leader Tom Daschle, a spectacular breach of the etiquette of that body.

The Republicans have a solid enough majority in the House to pass most conservative legislation, but Senate rules that give added power to the minority are proving an insurmountable roadblock to congressional action.

But there are other reasons for the legislative gridlock, including the fact that in this election year, lawmakers are reluctant to confront problems that don’t conform to their simplistic campaign slogans.

The budget is a mess and everybody knows it is going to take Draconian action to deal with it — huge program cuts or tax increases — but that’s the last thing nervous partisans on both sides of the aisle want.

The Bush administration, preoccupied by the deteriorating situation in Iraq, has not aggressively pushed its domestic legislative agenda, adding to the congressional malaise.

While nobody cheers the results, this latest do-nothing Congress has a silver lining for liberal Jewish groups.

"A lot of things we expected would go through very quickly in this Congress have stalled," said an official with one group, "and given the current political climate, that may be the best we can hope for."

An example: the stalled effort to reauthorize the controversial 1996 welfare reform law. The original law included the first national "charitable choice" provisions, whic opened the door to government contracts for religious groups to provide social services; the reauthorization was expected to renew and expand those provisions.

But the bill was yanked when senators got hopelessly bogged down in debates over minimum-wage provisions, and nobody, apparently, thought it was worth trying to hammer out a compromise.

Overall, the president’s faith-based initiative is not likely to get much of a hearing in a Congress ideologically disposed to it, but not disposed to find the compromises it will take to enact the plan into law.

And some legislation is more useful stalled than passed.

A constitutional amendment barring gay marriage and an extension of the controversial Patriot Act are unlikely to move this year, in part because many Republican leaders expect to gain political mileage by blaming the Democrats for holding them back. Many Democrats are working to block those bills — and the Republicans aren’t trying very hard to get past those roadblocks.

But the gridlock is also sidelining measures these Jewish groups support, including an expanded hate crimes statute and the Workplace Religious Freedom Act (WRFA).

Jewish leaders are pushing legislation to provide $100 million in homeland security money to help nonprofit agencies, including synagogues and Jewish schools, protect themselves against terror attacks.

But congressional leaders are much more interested in playing partisan "gotcha" than in figuring out how to the provide the money.

And then there’s the budget time bomb.

Congress didn’t deal with the soaring deficit last year, when it failed to pass 11 of 13 appropriations bills, and it’s unlikely to do much better this year. Instead, most observers expect another big, pork-laden "continuing resolution" — Congress-talk for a gimmick to put off hard budget decisions.

That’s good news — sort of — for agencies that expect big cuts when Congress finally does start dealing with the runaway deficit. But in the end, putting off a serious budget reckoning will only compound the problem.

Jewish groups don’t have magic answers to the budget crisis, but almost all agree: the longer Congress fiddles while the budget burns, the worse will be the ultimate consequences.

And forget about meaningful Medicare, Medicaid and Social Security reform to keep the vital programs solvent when the Baby Boom generation hits the Golden Years.

Recent history suggests the "What, Me Worry" Congress will be overwhelmingly reelected on Nov. 2, but it sure won’t be because of its distinguished legislative record.

Vote Yes on 57, 58: They Will Ease Crisis


It certainly is an unusual situation, but we Republicans are encouraging you to vote to increase the debt of the state of California, and we are doing it with a straight face.

As you know, Proposition 57 is asking Californians to commit to a bond issue of $15 billion. This commitment will allow our state budget to be stabilized, so that we can begin the process of moving forward.

If you study the state budgets over the last few years as I have, you would see that we have had a deficit at the end of each year that keeps getting larger each and every year. Even when revenues were perceived to be at a peak, we were outspending those revenues. The state budget began each year in the hole that just got deeper as the months went by.

Now we have a twofold problem. We must deal with the backlog created from prior years and try to balance this year’s budget, where expenses still are outstripping revenues. Proposition 57 will allow us to focus on eliminating the current budget imbalance without the draconian past debt facing us.

As it is, we will face serious cuts in our state budget. The growth in expenditures will have to be eliminated and actual cuts in important programs will have to be made.

As much as some of us would like to effect the cuts now that are necessary to erase this debt, we have come to the conclusion that it would significantly harm our state’s economy. This would stifle the immediate economic growth we need to reach budget equilibrium.

This new debt is not going away. That is understood. We are going to have to pay it back over the next decade. It will be in a fashion that will allow our legislators to craft a budget that will not start wallowed in debt before the opening discussions begin. By our good fortune, this debt will be financed at today’s very low interest rates.

The question then becomes how do we prevent this disastrous situation from re-occurring. We must pass the companion proposition — No. 58. It specifically makes it illegal to create any future bonds to finance a budget deficit again. It requires the Legislature to balance the budget.

Proposition 58, in addition to requiring a balanced budget each year, establishes that there must be a budget reserve in case projected revenues fall short. This is an important part of the measure.

A year in advance, some very smart people sit down and project what the revenues are going to be for the next 12 months for the world’s sixth largest economy. As smart as they are, it is a Herculean task, where it is easy to be off a billion dollars or more. This reserve will recognize that projections are only projections, and we should provide a cushion for dealing with the inevitable changes.

These new budget requirements can only be deviated from when there is a fiscal emergency upon which both the governor and Legislature agree. Some would say that a balanced budget should be locked in stone.

Those feelings are certainly justified after the dismal performance of the last few years. Once we divorce ourselves from those feelings and look at the budgeting process on a long-term basis, it becomes easier to see that this is a necessary clause that allows our elected officials to act responsibly, when a true disaster happens. If, God forbid, another earthquake occurs matching the damage caused by the Northridge quake, we would all want our leaders in Sacramento to do what is necessary to return our lives to normal.

These are the reasons why a broad spectrum of the political and financial universe is supporting both Proposition 57 and 58. It is a reasoned plan of action.

There may be alternative plans that seem good, but this one is worked out and ready to go. Let’s give it a chance and make judgment about its success after we see the full effects.

There are many important votes to cast on March 2, but none is more important for the future stability of our state than to vote yes on Proposition 57 and 58.


Bruce L. Bialosky is the Southern California chairman of the Republican Jewish Coalition.