Jobs

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President Obama has proposed a $266 billion jobs bill that contains tax credits for small businesses that hire more workers, an increase in the federal highway fund to patch our crumbling infrastructure, and a short-term extension on the federal unemployment benefits. It’s a boost to the economy, but it’s not nearly enough to put 15 million Americans back to work.

Last year Congress approved $787 billion stimulus package, mostly in tax cuts and aid for “shovel-ready” projects at the state and local level. For most of us $787 billion sounds like an awful lot of money, but when you look closely, it was far less than it appeared.

Much of the stimulus was spent to “patch” the alternative minimum tax ($70 billion), which Congress routinely spends every year with or without a recession. Another $100 billion was appropriated for infrastructure projects that will take a decade to complete.  More significantly, while the federal government was trying to expand the economy, state and local governments were forced to cut spending and raise taxes, fees, and tuition for public universities. In fiscal 2010, 48 state governments had budget deficits totaling $162 billion, and when you toss in the debt of municipalities, the total debt is well above $200 billion. According to the nonpartisan Congressional Budget Office when you net out the effect of state and local governments cutting programs and raising taxes, the real federal stimulus averaged only about $126 billion annually for 2009 and 2010. That’s less than 1% of our GDP.

What that means is that while the feds were trying to hire more road crews and contractors, states and municipalities were laying off cops and teachers. The feds were rowing in the direction of expanding the economy, while the states were rowing towards constricting the economy. Small wonder that 15 million Americans are still out of work, 25% of homes are worth less than the outstanding mortgage, and the number of bankruptcies, foreclosures, and failed banks are near record levels.

The President’s modest jobs bill is not going to work unless the federal government does something to relieve the burden on state and local government.

One way to give the economy a strong jolt would be for the federal government to open a line of credit to every state and locality. If the feds extended credit to state and local governments up to $1000 per resident at super-low interest for 30 years, why would any state or local politician refuse? We could strengthen our first-responders, improve our schools, lower tuition costs, and keep state and local taxes from rising. That would put more Americans to work, increase tax revenues, and eventually help to pay down the deficit.

I know what you’re thinking. The Republicans will accuse the Democrats of being tax-and-spend liberals. But if they do, the Republicans will be shouted down by the chorus of local and state government officials who do not want to be forced to make choices between raising taxes or cutting essential services.

We need jobs. But the President’s job bill will not succeed unless we have the federal, state and local governments all rowing in the same direction at once.

The election of the forty-first Republican and the first nudie model to the U.S. Senate has the pundits chattering. Scott Brown’s victory in the Massachusetts senate race is being read as a dark omen of what the Democrats will face in the mid-term election. Does Scott Brown’s election really signal the emergence of the Tea Party as a powerful new reactionary force on the American political scene? Does his election foretell the end of the Democratic majority? Is it a turning point in American politics?  

We can’t know for sure, but history is never so predetermined. It’s more than likely that the pundits are wrong. After all these are the same pundits who predicted last year that the Democratic majority would rule for a generation – before they predicted that Obama was unelectable and Hillary Clinton had the Democratic nomination sewn up.

Here’s another interpretation: Scott Brown defeated an indifferent Democratic politician who didn’t even bother to campaign. The handful of voters who showed up at a special election in the middle of winter were motivated by frustration and anger – not necessarily directed at President Obama – but at the local Democratic machine politicians who took them for granted and run Massachusetts like a one-party state.

The media’s penchant for reading too much into Scott Brown’s election is a common phenomenon. Looking backward we often attribute significance to events that might be merely random localized occurrences. On the other hand, sometimes random occurrences can alter the course of history. We learn in school that history is determined by great leaders, big ideas, or broad social movements. But sometimes, history is determined by accident.

The success of the American Revolution, for example, has been attributed to a wide-range of causes: the brilliant leadership of our founding fathers, the ideology of civic republicanism, and the social mobility of American colonists. But a more likely explanation is the particular timing of France’s intervention on the side of the colonies.

Why did Louis XVI agree to aid the American revolutionaries when they appeared to be losing? The conventional explanation is that Benjamin Franklin charmed the French monarchy into providing all of the arms, ammunition and supplies for the Continental Army. But, in reality, Franklin had nothing to do with it.

In January 1776, long before Franklin arrived in France, he sent an unknown Connecticut shopkeeper, Silas Deane, on a secret mission to persuade Louis XVI to arm the Americans. Deane had never left Connecticut in his life, could not speak a word of French, and knew nothing about diplomacy. But Franklin thought that Deane was such an improbable emissary that the British spies would never suspect him.

Deane succeeded with the help of two Frenchmen: the comic playwright Caron de Beaumarchais and the French ambassador to London Chevalier d’Eon. This improbable trio are the subject of my new book, UNLIKELY ALLIES: How a Merchant, a Playwright, and a Spy Saved the American Revolution.

Beaumarchais was one of the most interesting men of the nineteenth century. Though he is best remembered as the author of the original plays, “The Barber of Seville” and “The Marriage of Figaro,” he also invented the wristwatch, designed the modern harp, performed and taught music, built the Paris water system with the Perrier brothers, spied for the French King, and traded arms on the side. Deane and Beaumarchais together smuggled all of the arms, ammunition, uniforms, tents, blankets, and boots for an army of 30,000 men passed a swarm of British spies and through a British blockade to the Continental Army. The arms were sent before Franklin even set foot in France, and they arrived just in time to sway the outcome of the Battle of Saratoga, the turning point of the American Revolution.

None of this would have been possible without the leavening influence of the flamboyant Chevalier d’Eon. D’Eon was a decorated French war hero, an accomplished diplomat, and a brilliant spy, who was also blackmailing the French king. Louis XVI sent Beaumarchais on a secret mission to London to persuade d’Eon to surrender the incriminating documents. The dashing playwright ended up seducing d’Eon, who  admitted to Beaumarchais that he was in fact – a woman.

D’Eon’s decision to come out as a woman after forty years disguised as a male soldier, diplomat and spy set in motion a series of events that provided the catalyst that convinced Louis XVI to arm the Americans against the British. How and why that happened is the story of UNLIKELY ALLIES.

The point of my book is that history isn’t just hammered out by great leaders or great ideas or great social movements; the arc of history is just as often bent by random events, peripheral characters, and strange coincidents. History, like weather, is subject to the famous “butterfly effect.”

Scott Brown’s election is another chance occurrence. Perhaps he will change the trajectory of political history. But I doubt it. Right now, the forty-first Republican has nothing coherent to offer except his rigid opposition to health reform. Between now and the next election there will be many more butterflies that none of us can anticipate. We should be cautious about reading too much into a special election.

I’m not saying that Brown’s election is completely irrelevant. Maybe someday Brown will look no less significant in American history than that cross-dressing French spy who revealed herself. But for now all we can say for sure about Brown is that the senator has no clothes.

Cross-posted at http://www.acslaw.org/node/15336