Wednesday, November 27, 2013

How McDonald's and Wal-Mart Became Welfare Queens

How McDonald's and Wal-Mart Became Welfare Queens

Barry Ritholtz

It seems that welfare queens are back in the news these days. The old stereotype was an inner-city unwed mother -- that’s dog-whistle-speak for black -- having multiple babies to get ever bigger welfare checks (throw in a new Cadillac and the myth is complete). Regardless, welfare reform of the 1990s ended that narrative.

No, the new welfare queens are even bigger, richer and less deserving of taxpayer support. The two biggest welfare queens in America today are Wal-Mart and McDonald's.

This issue has become more known as we learn just how far some companies have gone in putting their employees on public assistance. According to one study, American fast food workers receive more than $7 billion dollars in public assistance. As it turns out, McDonald's has a “McResource” line that helps employees and their families enroll in various state and local assistance programs. It exploded into the public when a recording of the McResource line advocated that full-time employees sign up for food stamps and welfare.

Wal-Mart, the nation’s largest private sector employer, is also the biggest consumer of taxpayer supported aid. According to Florida Congressman Alan Grayson, in many states, Wal-Mart employees are the largest group of Medicaid recipients. They are also the single biggest group of food stamp recipients. Wal-mart’s "associates" are paid so little, according to Grayson, that they receive $1,000 on average in public assistance. These amount to massive taxpayer subsidies for private companies.

Why are profitable, dividend-paying firms receiving taxpayer subsidies? The short answer is, because they can. The longer answer is more complex and nuanced.

Both McDonald's and Wal-Mart are engaging in perfectly legal behavior. The system was set up long ago in ways that failed to imagine companies doing this. Yes, they are taking advantage of the taxpayer, but they are also operating within the law.

Which means it is time to change those outdated rules.

The simplest solution is to raise the minimum wage. If full-time employees are living below the poverty level -- especially those with children -- its no surprise they are going to need public assistance. Raising the minimum wage over a period of time will eliminate much of this corporate welfare. The costs will be slightly higher prices at fast food restaurants and low end retailers.

The next proposal is more severe: Charge back the amount of public assistance any employee receives to the company he or she works for. It would be separate from tax filings, and simply be a direct penalty charged to the firm. I doubt there is much political will for this proposal, but I can see some people -- especially on the Left -- supporting it.

The most radical idea is bit of pure fantasy: Guarantee every person in America a minimum salary. That is a proposal under discussion today in Switzerland. Its hard to even imagine such a concept gaining traction in the U.S. outside of the Great Depression era.

My politics are pretty middle-of-the-road, and I find myself offended by subsidizing profitable companies this way. As a taxpayer, there are much better things I would like to see my monies go towards. Some rule changes are needed to end this wasteful spending.

We should get corporate welfare queens off of the public teat. Regardless of your politics, it is an issue that politicians on both the Left and the Right can agree upon.

What a Higher Minimum Wage Does for Workers and the Economy


What a Higher Minimum Wage Does for Workers and the Economy

By Peter Coy, Susan Berfield
November 27, 2013 6:00 AM EST

Tom Wolfe himself couldn’t have imagined a better New York juxtaposition. Pizza, Pepsi, and hot chicken wings were out on the table one November evening at Strive New York, an agency in East Harlem that helps ex-convicts and other chronically unemployed people get and keep jobs. Luz Droz, 32, who has a 10-month-old son, explained that she was trying to turn things around after “a little situation in my life,” which turned out to be two prison sentences totaling eight years for dealing drugs and passing bad checks. She detests being on welfare but was turned down recently for a minimum-wage job at Burlington Coat Factory . “I thought I was going to get it,” she said. “Once I get a job, I’m off to the races.”

The same evening, one stop south on the 4 express subway line, waiters were serving hors d’oeuvres of tuna tartare and basil-slathered shrimp in the Upper East Side apartment of billionaire George Soros. The guest of honor was Soros’s fellow billionaire David Sainsbury, the former chairman of the family-founded British supermarket chain J Sainsbury. He has a new book, Progressive Capitalism. Sainsbury will probably never meet Luz Droz, but he, too, had minimum-wage employment on his mind. To compete with China, he said, “the West must race to the top” and not try to “screw down the wages.”

The down-on-her-luck mom who can’t land a job at minimum pay and the billionaire who can’t imagine paying so little are two voices in a global debate over not only the minimum wage, but also the bigger challenge of helping the least fortunate members of society. The federal minimum wage is $7.25 an hour. President Obama called for a $9 federal minimum by 2015 in his State of the Union address in February and then this fall endorsed a more ambitious bill, which is stuck in House and Senate committees, to raise it to $10.10 by 2015. California, New York, Connecticut, Rhode Island, and New Jersey voted to raise state minimums this year. Last August fast-food workers in almost 60 cities struck or walked out in a bid for starting pay of $15 an hour. In recent weeks two of the nation’s largest private employers, Wal-Mart Stores and McDonald’s, have taken heat for paying many of their workers so little that they need government benefits and charity to get by.

Raising the minimum wage is neither as wonderful as its advocates claim nor as dangerous as its detractors warn

Raising the minimum wage is neither as wonderful as its advocates claim nor as dangerous as its detractors warn. On the upside, it would increase pay for millions of Americans, not only those earning the minimum but also those at fixed increments above it. These are people who could really use a raise. Contrary to what generations of students were taught in freshman econ, new research finds that minimum-wage increases at the state level have caused little, if any, harm to employment. “Outside of the simple Econ 101-type environment, increasing workers’ pay can improve the functioning of the low-wage labor market,” Arindrajit Dube, a University of Massachusetts economist, testified before Congress in March.

On the downside, a higher wage floor would undoubtedly price some marginal workers out of the market. Interns, for example, aren’t allowed to work for less than the minimum while they learn the ropes. (They can be unpaid, but then they’re not allowed to do real work.) A higher minimum wage would do nothing for the unemployed, among whom are the poorest of the poor. For them, other solutions are needed. “The search for a silver bullet is a mistake. We need lots of bullets,” says Steven Pressman, an economist at New Jersey’s Monmouth University.

Raising the wage to catch up with inflation invariably polls well, because most Americans perceive it as a matter of justice. Their hearts go out to the likes of Shawndraka Mack, 40, who works full time at $7.60 an hour for a McDonald’s in Charleston, S.C. She and her disabled fiancé are raising two teenagers in the trailer home she inherited from her mother. “I love what I do,” she says, “but I don’t want to work for nothing.” Obama appealed to that sentiment in his State of the Union address when he said, “Tonight, let’s declare that in the wealthiest nation on earth, no one who works full time should have to live in poverty.” A Gallup poll in November found that 76 percent of Americans would vote for a $9 federal wage floor.

The public images of low-paying employers such as Wal-Mart and McDonald’s take a hit during the holidays, when Americans are seized by a spirit of charity. Stephen Colbert mocked Wal-Mart after employees at one of its stores started a Thanksgiving food drive for fellow workers. “Now, some critics out there say Wal-Mart isn’t doing enough, but they’re wrong,” Colbert said, “because Wal-Mart isn’t doing anything.”

Recognizing that they can’t get on the wrong side of their customers, many of whom have below-average incomes, Wal-Mart and McDonald’s are attempting to change the narrative. Both say they pay above the minimum to the vast majority of their employees. “Nationally, there has been an erosion of middle-class jobs, and we want to be part of the solution,” David Tovar, Wal-Mart’s vice president for communications, e-mailed journalists on Nov. 21. The same day in Chicago, McDonald’s chief executive officer, Don Thompson, pointed out at Bloomberg’s The Year Ahead: 2014 conference that 60 percent of the company’s franchisees started in hourly jobs.

Ultimately, the case for higher minimum pay should be evaluated on its economic merits. “Wages are a market price—determined by supply and demand, the same as the price of apples or coal,” one economist wrote in 1998. “The amorality of the market economy is part of its essence and cannot be legislated away.” (That economist—surprise—was Paul Krugman, who was skeptical about living-wage ordinances but today says a healthy jump in the minimum wage is justified on economic grounds.)

The latest support is based on the economic theory of “search frictions,” which won a Nobel Prize in 2010 for Peter Diamond, Dale Mortensen, and Christopher Pissarides. It’s the idea that employers and job seekers don’t find each other immediately. Fact: Some 3.9 million job openings went unfilled at the end of September, according to the Bureau of Labor Statistics. Raising the minimum wage makes workers less likely to quit, which reduces the number of openings at any given time, the theory goes. That boosts employment, offsetting layoffs of workers who are no longer worth their pay at the higher minimum. “There’s a widespread recognition that we need models with search frictions to really understand the labor market,” says Dube, the Massachusetts economist, who’s part of a new generation of scholars studying the minimum wage.

America’s minimum wage is 27 percent of the U.S. average pay, a lower ratio than that of any other member of the Organisation for Economic Co-operation and Development except Mexico. That doesn’t prove that the U.S. floor is too low—only that it can be higher without the sky falling. In Denmark, among the leading countries in income equality and national happiness, the minimum pay set by negotiations between employer groups and unions is the equivalent of about $20 an hour. Despite that, the World Bank has ranked Denmark as the easiest place in Europe to do business for three years running.

Still, raising the minimum wage is an inadequate response to the larger challenge of reducing poverty. “It’s just irrelevant to the real, first-order problems such families face,” writes John Cochrane, a University of Chicago economist. Brazil has a minimum wage, but it’s been far less effective in alleviating poverty than the renowned Bolsa Família program, which gives families cash payments as long as they get their children educated and vaccinated and meet other conditions, says Marcelo Côrtes Neri, president of the Institute of Applied Economic Research in Brasília.

The deeper problem for today’s poor is that many have lost any connection to the world of work

The deeper problem for today’s poor isn’t low pay. It’s that many have lost any connection to the world of work. In 1968, when the U.S. minimum wage hit its inflation-adjusted peak of $10.70 an hour, 81 percent of men aged 20 and older had jobs. Now 67 percent do. In October the unemployment rate for black teenagers was 36 percent. “Raising the minimum wage is a short-term fix,” contends Wal-Mart’s Tovar. The long-term solution, he says, involves “expanding education, training, and workforce development.”

The minimum wage can never be more than a piece of the social safety net. It’s attractive to liberals because it doesn’t require getting a tax increase through Congress: The cost to society shows up instead in the prices that employers raise to cover their higher costs. Because it’s only for workers, however, it can’t possibly fill the void of inadequate food stamps, welfare, and housing assistance.

In arguing for a higher minimum wage, Bloomberg View columnist Barry Ritholtz recently blasted Wal-Mart and McDonald’s as “welfare queens” because some of their employees, as a result of their meager pay, live partly on government benefits. (Families of McDonald’s workers have received an average $1.2 billion a year in benefits, according to an academic study funded by Fast Food Forward, which helped organize the summer strikes.)

True, those hidden subsidies to employers would shrink if the minimum wage rose, but it’s unreasonable to think they would disappear entirely. Britain’s New Poor Law of 1834 tried to end subsidies to employers by preventing recipients of relief from working for them. It locked them up instead in poorhouses of Dickensian cruelty. That’s hardly an example to follow. The other way out of inadvertently subsidizing private employers would be to cut off benefits to anyone who got a job. But that would penalize people who landed work or induce them to stay unemployed.

Although a favorite of liberals, the notion of raising the minimum wage is in some ways deeply conservative. It’s grounded in the traditional ethic that able-bodied people should support themselves by the sweat of their brows—and private employers, not the government, should be responsible for workers’ livelihoods. But what if technology throws some people out of work not temporarily, but permanently? What if many service positions follow manufacturing jobs into obsolescence? (There’s already a hamburger-making robot for sale.) If that happens, society will have to develop new ways to share its abundance with people whose services are no longer needed, speculates Brian Arthur, a nonresident professor at the Santa Fe Institute.

One up-and-coming solution is what advocates term unconditional basic income—an annual grant of fixed size that goes to every person in a country, rich or poor, regardless of whether they work or not. It’s a big step away from the minimum wage. Milton Friedman, the late libertarian economist, favored a variant—a payment that would phase out at higher incomes—to replace the intrusiveness of the welfare state.

Europe is headquarters for the unconditional basic income movement. This fall petitioners managed to get it on the national ballot in Switzerland. (The date hasn’t been set.) Giving people money unconditionally could start an epidemic of shirking work. But backers say most people would still want to work if they could, either to earn a standard of living above the spartan one guaranteed by the government, or to fulfill themselves, or both.

In the U.S., an increase in the minimum wage is far more likely than adoption of a universal basic income. A higher wage floor is right for low-skilled workers and harmless to the economy. But it’s only one piece of a very large economic puzzle.


Tuesday, May 22, 2012

HR 347-2, read and think

Here is HR 347-2 that is being suggested around that web that Obama is making free speech a felony.  Read the bill and make your own conclusion.

To me, it doesn't seem that much different then what is currently in place.

With three representatives voting no, the House passed the bill.  The Senate passed the law without a single no vote. 

For more opinons on the community, please visit The Responsible Community

HR 347-2

One Hundred Twelfth Congress of the United States of America

AT THE SECOND SESSION

Begun and held at the City of Washington on Tuesday,

the third day of January, two thousand and twelve

An Act

To correct and simplify the drafting of section 1752 (relating to restricted buildings

or grounds) of title 18, United States Code.

Be it enacted by the Senate and House of Representatives of

the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Federal Restricted Buildings

and Grounds Improvement Act of 2011’’.

SEC. 2. RESTRICTED BUILDING OR GROUNDS.

Section 1752 of title 18, United States Code, is amended to

read as follows:

‘‘§ 1752. Restricted building or grounds

‘‘(a) Whoever—

‘‘(1) knowingly enters or remains in any restricted building

or grounds without lawful authority to do so;

‘‘(2) knowingly, and with intent to impede or disrupt the

orderly conduct of Government business or official functions,

engages in disorderly or disruptive conduct in, or within such

proximity to, any restricted building or grounds when, or so

that, such conduct, in fact, impedes or disrupts the orderly

conduct of Government business or official functions;

‘‘(3) knowingly, and with the intent to impede or disrupt

the orderly conduct of Government business or official functions,

obstructs or impedes ingress or egress to or from any restricted

building or grounds; or

‘‘(4) knowingly engages in any act of physical violence

against any person or property in any restricted building or

grounds;

or attempts or conspires to do so, shall be punished as provided

in subsection (b).

‘‘(b) The punishment for a violation of subsection (a) is—

‘‘(1) a fine under this title or imprisonment for not more

than 10 years, or both, if—

‘‘(A) the person, during and in relation to the offense,

uses or carries a deadly or dangerous weapon or firearm;

or


‘‘(B) the offense results in significant bodily injury as

defined by section 2118(e)(3); and

‘‘(2) a fine under this title or imprisonment for not more

than one year, or both, in any other case.

‘‘(c) In this section—

H. R. 347—2

‘‘(1) the term ‘restricted buildings or grounds’ means any

posted, cordoned off, or otherwise restricted area—

‘‘(A) of the White House or its grounds, or the Vice

President’s official residence or its grounds;

‘‘(B) of a building or grounds where the President or

other person protected by the Secret Service is or will

be temporarily visiting; or

‘‘(C) of a building or grounds so restricted in conjunction

with an event designated as a special event of national

significance; and

‘‘(2) the term ‘other person protected by the Secret Service’

means any person whom the United States Secret Service is

authorized to protect under section 3056 of this title or by

Presidential memorandum, when such person has not declined

such protection.’’.

Speaker of the House of Representatives.

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Sunday, May 6, 2012

The debates in the several state conventions on the adoption of the Federal Constitution, Volume 4. 

The link is to James Madison's responses to the Allein and Sedition act.

PADILLA v. KENTUCKY ( No. 08-651 )

PADILLA v. KENTUCKY ( No. 08-651 )
253 S. W. 3d 482, reversed and remanded.


Scalia, J., dissenting

SUPREME COURT OF THE UNITED STATES

JOSE PADILLA, PETITIONER v. KENTUCKY

on writ of certiorari to the supreme court of kentucky

 [March 31, 2010]

Justice Scalia , with whom Justice Thomas joins, dissenting.

In the best of all possible worlds, criminal defendants contemplating a guilty plea ought to be advised of all serious collateral consequences of conviction, and surely ought not to be misadvised. The Constitution, however, is not an all-purpose tool for judicial construction of a perfect world; and when we ignore its text in order to make it that, we often find ourselves swinging a sledge where a tack hammer is needed.

The Sixth Amendment guarantees the accused a lawyer “for his defense” against a “criminal prosecutio[n]”—not for sound advice about the collateral consequences of conviction. For that reason, and for the practical reasons set forth in Part I of J ustice A lito ’s concurrence, I dissent from the Court’s conclusion that the Sixth Amendment requires counsel to provide accurate advice concerning the potential removal consequences of a guilty plea. For the same reasons, but unlike the concurrence, I do not believe that affirmative misadvice about those consequences renders an attorney’s assistance in defending against the prosecution constitutionally inadequate; or that the Sixth Amendment requires counsel to warn immigrant defendants that a conviction may render them removable. Statutory provisions can remedy these concerns in a more targeted fashion, and without producing permanent, and legislatively irreparable, overkill.

The Sixth Amendment as originally understood and ratified meant only that a defendant had a right to employ counsel, or to use volunteered services of counsel. See, United States v. Van Duzee , 140 U. S. 169, 173 (1891) ; W. Beaney, Right to Counsel in American Courts 21, 28–29 (1955). We have held, however, that the Sixth Amendment requires the provision of counsel to indigent defendants at government expense, Gideon v. Wainwright , 372 U. S. 335, 344–345 (1963) , and that the right to “the assistance of counsel” includes the right to effective assistance, Strickland v. Washington , 466 U. S. 668, 686 (1984) . Even assuming the validity of these holdings, I reject the significant further extension that the Court, and to a lesser extent the concurrence, would create. We have until today at least retained the Sixth Amendment ’s textual limitation to criminal prosecutions. “[W]e have held that ‘defence’ means defense at trial, not defense in relation to other objectives that may be important to the accused.” Rothgery v. Gillespie County, 554 U. S. ___, ___ (2008) (A lito , J., concurring) (slip op., at 4) (summarizing cases). We have limited the Sixth Amendment to legal advice directly related to defense against prosecution of the charged offense—advice at trial, of course, but also advice at postindictment interrogations and lineups, Massiah v. United States , 377 U. S. 201, 205–206 (1964) ; United States v. Wade , 388 U. S. 218, 236–238 (1967) , and in general advice at all phases of the prosecution where the defendant would be at a disadvantage when pitted alone against the legally trained agents of the state, see Moran v. Burbine , 475 U. S. 412, 430 (1986) . Not only have we not required advice of counsel regarding consequences collateral to prosecution, we have not even required counsel appointed to defend against one prosecution to be present when the defendant is interrogated in connection with another possible prosecution arising from the same event. Texas v. Cobb , 532 U. S. 162, 164 (2001) .

There is no basis in text or in principle to extend the constitutionally required advice regarding guilty pleas beyond those matters germane to the criminal prosecution at hand—to wit, the sentence that the plea will produce, the higher sentence that conviction after trial might entail, and the chances of such a conviction. Such matters fall within “the range of competence demanded of attorneys in criminal cases,” McMann v. Richardson , 397 U. S. 759, 771 (1970) . See id., at 769–770 (describing the matters counsel and client must consider in connection with a contemplated guilty plea). We have never held, as the logic of the Court’s opinion assumes, that once counsel is appointed all professional responsibilities of counsel—even those extending beyond defense against the prosecution—become constitutional commands. Cf. Cobb , supra , at 171, n. 2; Moran , supra , at 430. Because the subject of the misadvice here was not the prosecution for which Jose Padilla was entitled to effective assistance of counsel, the Sixth Amendment has no application.

Adding to counsel’s duties an obligation to advise about a conviction’s collateral consequences has no logical stopping-point. As the concurrence observes,

“[A] criminal convictio[n] can carry a wide variety of consequences other than conviction and sentencing, including civil commitment, civil forfeiture, the loss of the right to vote, disqualification from public benefits, ineligibility to possess firearms, dishonorable discharge from the Armed Forces, and loss of business or professional licenses. . . . All of those consequences are ‘serious,’ … .” Ante , at 2–3 ( Alito, J., concurring in judgment).

But it seems to me that the concurrence suffers from the same defect. The same indeterminacy, the same inability to know what areas of advice are relevant, attaches to misadvice. And the concurrence’s suggestion that counsel must warn defendants of potential removal consequences, see ante , at 14–15—what would come to be known as the “ Padilla warning”—cannot be limited to those consequences except by judicial caprice. It is difficult to believe that the warning requirement would not be extended, for example, to the risk of heightened sentences in later federal prosecutions pursuant to the Armed Career Criminal Act, 18 U. S. C. §924(e). We could expect years of elaboration upon these new issues in the lower courts, prompted by the defense bar’s devising of ever-expanding categories of plea-invalidating misadvice and failures to warn—not to mention innumerable evidentiary hearings to determine whether misadvice really occurred or whether the warning was really given.

The concurrence’s treatment of misadvice seems driven by concern about the voluntariness of Padilla’s guilty plea. See ante , at 12. But that concern properly relates to the Due Process Clauses of the Fifth and Fourteenth Amendment s, not to the Sixth Amendment . See McCarthy v. United States , 394 U. S. 459, 466 (1969) ; Brady v. United States , 397 U. S. 742, 748 (1970) . Padilla has not argued before us that his guilty plea was not knowing and voluntary. If that is, however, the true substance of his claim (and if he has properly preserved it) the state court can address it on remand. 1 But we should not smuggle the claim into the Sixth Amendment .

The Court’s holding prevents legislation that could solve the problems addressed by today’s opinions in a more precise and targeted fashion. If the subject had not been constitutionalized, legislation could specify which categories of misadvice about matters ancillary to the prosecution invalidate plea agreements, what collateral consequences counsel must bring to a defendant’s attention, and what warnings must be given. 2 Moreover, legislation could provide consequences for the misadvice, nonadvice, or failure to warn, other than nullification of a criminal conviction after the witnesses and evidence needed for retrial have disappeared. Federal immigration law might provide, for example, that the near-automatic removal which follows from certain criminal convictions will not apply where the conviction rested upon a guilty plea induced by counsel’s misadvice regarding removal consequences. Or legislation might put the government to a choice in such circumstances: Either retry the defendant or forgo the removal. But all that has been precluded in favor of today’s sledge hammer.

In sum, the Sixth Amendment guarantees adequate assistance of counsel in defending against a pending criminal prosecution. We should limit both the constitutional obligation to provide advice and the consequences of bad advice to that well defined area.

Notes

1 I do not mean to suggest that the Due Process Clause would surely provide relief. We have indicated that awareness of “direct consequences” suffices for the validity of a guilty plea. See Brady, 397 U. S., at 755 (internal quotation marks omitted). And the required colloquy between a federal district court and a defendant required by Federal Rule of Criminal Procedure 11(b) (formerly Rule 11(c)), which we have said approximates the due process requirements for a valid plea, see Libretti v. United States, 516 U. S. 29, 49–50 (1995) , does not mention collateral consequences. Whatever the outcome, however, the effect of misadvice regarding such consequences upon the validity of a guilty plea should be analyzed under the Due Process Clause.
2 As the Court’s opinion notes, ante, at 16–17, n. 15, many States—including Kentucky—already require that criminal defendants be warned of potential removal consequences.

-----

Friday, February 10, 2012

Obama reverses course after pressure from allies

Feb 10 (Reuters) - As soon as the news hit, the deluge began.
Catholics from across the country began calling the White House within hours of the Obama administration's announcement on Jan. 20 that religious institutions would be required to offer free birth control to employees as a health-care benefit.
But these calls weren't protests from conservative bishops or the rank-and-file in the pews. They were calls from a kitchen cabinet of informal political advisers that President Barack Obama had relied on for years -- allies who had worked with him on various social issues and in some cases, campaigned for him.
They had access, and they intended to use it to drive change in a policy they said they saw as a clumsy, provocative and an unnecessary infringement on religious liberty.
Among the many who called: Tim Roemer, a former Democratic congressman from Indiana; Stephen Schneck, a political scientist at the Catholic University of America; and Sister Simone Campbell, who runs a Catholic social-justice lobby in Washington.
They reached out to friends in the Obama campaign, in the office of Vice President Joe Biden, in the White House domestic policy shop and its office of faith-based initiatives, in the Department of Health and Human Services.
One even wrote a proposed speech for the president, in which Obama would admit he'd been wrong and offer a compromise.
"A daily dunning," is how Campbell described it.
UNCERTAIN FOOTING
From the start, Obama officials were receptive to calls for change, Campbell and others said. But they seemed uncertain about how to proceed, and the talks had little urgency.
People close to the White House said formulating the policy on contraceptive coverage had been a bruising fight, lasting for months last fall and into the winter, with deep divisions among senior staff - including its Catholics - about the wisdom of requiring Catholic colleges and hospitals to subsidize free birth control for their employees in the name of improving women's health care access.
The administration seemed prepared for a furious protest from the U.S. Conference of Catholic Bishops, a formidable adversary in the earlier debate over healthcare reform, people with knowledge of the internal debate said.
But officials appeared taken aback by the intensity of the pleas coming from close Obama allies, several of whom argued to anyone who would listen that the policy was not only morally wrong, but out of step with the president's values.
"This decision just seems not in keeping with the person he is," said Douglas Kmiec, a conservative legal scholar at Pepperdine University and an Obama supporter.
In their quest for a compromise, Kmiec and other allies of the president focused at first on what was dubbed the "Hawaii solution." Hawaii requires all health insurance plans to cover contraception. But it lets religious employers delete that benefit from their plans - so long as they agree to refer any worker seeking contraceptive coverage to a third party that can provide it at nominal cost.
The HAWAII SOLUTION
The Hawaii model excited several Catholic allies, who thought it would neatly solve the problem by ensuring that religious employers didn't have to pay for the birth control benefits themselves.
But as talk about a Hawaii solution intensified, Catholic bishops moved to quash it, arguing that referring women to low-cost contraception would be as immoral as distributing the drugs and devices first-hand.
"The church must have the freedom to refuse to cooperate in any way in making these 'services' available," Bishop William Lori, who heads a committee on religious liberty, wrote on the U.S. Conference of Catholic Bishops blog. "If we provide the means for another to act against the moral law, we ourselves become morally culpable as well."
That pronouncement came at the crest of a potent protest wave orchestrated by the bishops. Women's groups, meanwhile, had begun pushing back hard against suggestions of compromise.
Judy Waxman, a vice president of the National Women's Law Center, even said she would consider suing if the administration changed the policy in a way that required women to jump through any hoops to get their free contraception. "I see potential litigation in my future," she said before the compromise was reached.
Working frantically behind the scenes, Obama's loose-knit Catholic ally network continued to press its case. As noise on the issue grew, the allies said they began to gain traction with the White House. "As the momentum built, they realized, 'Uh oh, we've got trouble,' " said Campbell, the social-justice advocate.
Yet for days, a solution still seemed elusive. Several possible options would have required legislative approval, and given the divisions in Congress and heated election-year politics, Obama did not want to take that route, those familiar with the process said.
At the same time, said a senior Obama advisor, the president made clear he would not back down from his central point - that women employed by Catholic institutions should have the same right to free birth control, with no deductible and no co-pay, as woman employed by any other entity.
"It was hard figuring out the details of how this could work structurally," said John Gehring, who coordinates Catholic outreach for the group Faith in Public Life, a policy advocacy group generally aligned with Democratic policies.
As they struggled to find a solution, the would-be reformers found considerable support within the White House Office of Faith-Based and Neighborhood Partnership, where several staff members suggested they were not happy with the president's original policy. A key point person there: Joshua DuBois, the office head, who knew many of Obama's outside allies from the 2008 campaign and who reports to close Obama confidant Valerie Jarrett.
The faith office "was pressing very hard for a reasonable tweaking of the policy," Gehring said.
Those pushing for compromise also found a friend in Vice President Joe Biden, a fellow Catholic, who had argued from the beginning that religious employers should be exempt from the contraception mandate.
"He understands the Catholic community's views on these issues and is willing to speak up for them when appropriate," said James Salt, executive director of Catholics United, a group with a history of supporting liberal causes.
But though they were getting high-placed signals that a compromise could be worked out, no details emerged. As the days wore on and the political rhetoric grew louder, some Obama allies got discouraged. "The lines in the sand are being drawn sharper and deeper, so I'm not optimistic," Schneck, the political scientist, said earlier this week.
On Friday, Schneck said he realized why he had received so little concrete information about the working compromise. The administration had been so divided in its deliberations about the rule, he said, that "they needed to work this out inside their own walls first," before floating it to key interest groups.
"This was an internecine struggle," he said.
A senior U.S. official said that many of the reports about the internal White House deliberations have been "overdramatized." Officials declined to comment further on internal discussions.
Late Thursday evening, administration officials reached out to Schneck and other involved parties to let them know an announcement was imminent. "There was a tremendous sense of relief," Gehring said.
Before unveiling his compromise Friday morning, Obama called Archbishop Timothy Dolan, president of the U.S. Conference of Catholic Bishops; Cecile Richards, president of Planned Parenthood Federation of America; and Sister Carol Keehan, president of the Catholic Health Association of the United States.
Richards and Keehan welcomed the announcement. The Conference of Catholic Bishops has been more cautious, releasing a statement calling the new approach promising, but declining to endorse it fully.
The compromise allows religious employers to opt out of providing birth control coverage to employees. But in making that concession, Obama promised those employees that they could get free contraception all the same, courtesy of their health insurance providers.
Obama's Catholic allies said that approach hit all the right notes. "Very practical, very respectful, very common sense," Roemer said.
Sister Campbell wasn't so restrained: "This," she said, "is a glorious day."

Thursday, August 11, 2011

The Debt



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