ECONOMY
Avoiding Neo-Hooverism

Recently, several media commentators as well as politicians have been championing what the Center for American Progress Action Fund's Matthew Yglesias dubbed "neo-Hooverism" -- the notion that the next president should significantly curb spending due to the financial crisis. While it was certainly a mistake for the Bush administration to amass such huge deficits, the severity of the current economic crisis calls for loosening of fiscal restraint. Nobel Prize-winning economist Paul Krugman explained, "[R]ight now, increased government spending is just what the doctor ordered, and concerns about the budget deficit should be put on hold." "[I]t is clear that additional federal supports are required to help jump start our economic recovery and lay the foundation for long-term growth," said Gov. Arnold Schwarzenegger (R-CA) yesterday. Sen. John McCain (R-AZ), however, is defying the advice of the economists, proposing a drastic reduction in government spending. "And I'll cut spending," he said. "I will keep [Americans] taxes low."

THE NEW HOOVERS: During the third presidential debate, McCain proclaimed that the public "wants a new direction. I can bring them in that direction by eliminating spending." McCain has advocated a freeze on all discretionary spending, a radical proposal that would in turn allow inflation to eat away at Head Start funding, Pell Grant funding, unemployment benefits, and food stamp programs, just to name a few. On Monday, McCain adviser Douglas Holtz-Eakin acknowledged that balancing the budget will be "harder" to do because of the economic downturn. Nevertheless, Gov. Sarah Palin (R-AK) still commits to a balanced budget by the end of the first term. Sens. Norm Coleman (R-MN) and Saxby Chambliss (R-GA) have also committed to aggressively pursuing a balanced budget during the economic crisis.

INVEST AT HOME: A consensus is emerging among economists that the recession has brought on the need for the next administration to, "initially, at least -- open its wallet, not tighten its belt." As Krugman noted, "There's a lot the federal government can do for the economy. It can provide extended benefits to the unemployed, which will both help distressed families cope and put money in the hands of people likely to spend it. It can provide emergency aid to state and local governments, so that they aren't forced into steep spending cuts that both degrade public services and destroy jobs." Even fiscal hawks recommend avoiding immediate deficit-reduction. "Right now would not be the time to balance the budget," said Maya MacGuineas, president of the conservative Committee for a Responsible Federal Budget. Robert Bixby of the Concord Coalition, a group that McCain said he goes to for economic advice, observed, "There is a real threat of a serious recession. ... So it's appropriate in those circumstances to loosen fiscal policy, so long as it is done on a targeted and temporary basis."

STIMULATE THE ECONOMY: As the Center for American Progress has outlined, a second stimulus package would stimulate the economy and stem the tide of job loss. The stimulus should jump-start a low-carbon economy, invest in infrastructure, expand unemployment insurance, increase energy assistance, and boost food stamp support. "America needs a job-creating recovery package to get our economy back on track and to restore consumer and investor confidence," said House Speaker Nancy Pelosi (D-CA), speaking in favor of a $150 billion stimulus. Fed Chairman Ben Bernanke also said this week that he supports a "significant" stimulus, saying that a "consideration of a fiscal package by the Congress at this juncture seems appropriate." The stimulus is a first step and should be proceded by a larger framework that includes housing stabilization, Green Recovery, infrastructure investment, and long-term growth. Data-driven discipline can help increase efficiency in government spending. McCain has derided the second stimulus as "wasteful spending" and "earmarked projects." Instead, he is offering an ineffective stimulus of his own: cutting the capital gains tax -- in essence, a tax cut for millionaires. The White House opposes extending jobless benefits and has hinted that it would oppose a second stimulus.

Under the Radar

IRAQ -- STATE DEPARTMENT CANCELS CONTRACT WITH PRIVATE INVESTIGATORS: The Washington Post reports today that the State Department "suddenly canceled a contract for eight private investigators to assist U.S. officials in Iraq in 'extremely complex and sensitive investigations.'" As ABC reported earlier this month, the private investigators were assigned to the "Force Investigation Unit (FIU) that investigates potential misuses of force against civilians by U.S. security contractors." FIU's use of the private contractors was an "apparent violation" of federal regulations. Sen. Russ Feingold (D-WI) wrote to Secretary of State Condoleezza Rice in September saying, "It is highly troubling that the Department is apparently outsourcing oversight of its security contractors. ... Criminal investigations are inherently governmental functions that, according to long-standing U.S. government policy, should not be outsourced." Last Friday, the State Department replied to Feingold, writing that "the use of contract security specialists/investigators in the FIU has been terminated." In a statement issued yesterday, however, the Department failed to acknowledge that the use of contractors had ever been improper, saying only that they "were no longer needed 'due to the improved security situation [and] the reduction in use-of-force incidents by private security contractors in Iraq.'"

SCIENCE -- ANTI-STEM CELL AD COMPARES RESEARCH TO TUSKEGEE STUDY: Opponents of Michigan's Proposal 2 -- a measure legalizing embryonic stem cell research that will appear on the Nov. 4 ballot -- have released a new ad that a Detroit Free Press writer calls "shameless fear-mongering." The ads, "running in heavy rotation on television in the Detroit area," falsely claim stem cell research would be unregulated and compares it to the infamous Tuskegee study in which hundreds of African-American men were denied treatment for syphilis. The ad, paid for by Michigan Citizens Against Unrestricted Science and Experimentation, cites the "ugly past" of "unrestricted science," and claims Proposal 2 would allow "unregulated scientific experimentation on live human embryos." "The point is clear: to frighten minority communities into voting against Prop 2 by drawing a false connection with past abuse," Free Press' Stephen Henderson writes. The ad cites an out-of-context Free Press quote, even though the paper issued a ringing endorsement of Proposal 2 earlier this month.

RADICAL RIGHT -- LIMBAUGH AND GIULIANI INDIRECTLY BLAME 9/11 ON PRESIDENT CLINTON: Discussing Sen. Joe Biden's (D-DE) recent comments that the world will "test the mettle" of Sen. Barack Obama (D-IL) with an international crisis if he is elected, right-wing talker Rush Limbaugh and Rudy Giuliani indirectly blamed the terrorist attacks of 9/11 on former President Bill Clinton on Monday. "Every time Clinton was tested, he failed, and that's why they tested Bush on 9/11," said Limbaugh. Giuliani agreed. The fact that Giuliani so easily agreed with Limbaugh is surprising, considering that in 2006 he said it was wrong to "cast blame on Clinton" for 9/11. "I don't think he deserves it," said Giuliani. Though Clinton has freely acknowledged that he "failed" to get Osama bin Laden, his administration aggressively pursued terrorism. For instance, a June 1995 Presidential Decision Directive issued by Clinton emphasized concern about terrorism "as a national security issue" for the first time, instead of just a matter of law enforcement. Clinton's directive declared that the United States saw "terrorism as a potential threat to national security as well as a criminal act and will apply all appropriate means to combat it." For the last three years of his presidency, Clinton "raised the issue of terrorism in virtually every important speech he gave." In his book, Against All Enemies, former counterterrorism czar Richard Clarke -- who served under Reagan, both Bushes, and Clinton -- described Clinton doing more right than he did wrong in combating terrorism, such as declaring "a war on terror before the term became fashionable."

Think Fast

Yesterday, Senate Democrats subpoenaed Attorney General Michael Mukasey for "testimony and documents about the Justice Department's legal advice to the White House on detention and interrogation policies since the 2001 terror attacks." The Justice Department "blasted the subpoena as a partisan move."

"More than 2 million children in the United States who have no health insurance of any kind have at least one parent who gets employer-provided medical coverage," according to a new report in the Journal of the American Medical Association. Typically, these parents have coverage through work, but "cannot afford the extra thousands of dollars that may be needed for a plan that also covers their children."

Contrary to convention wisdom, a new study finds that long wait times and overcrowding in the hospital emergency rooms are not caused by "uninsured people with minor ailments who want free treatment." The study's lead author, Dr. Manya Newton of the University of Michigan, said that the nation's 46 million uninsured "are actually underrepresented in the emergency department."

"In a sign of growing unease with the proposed security agreement between the United States and Iraq," the Iraqi cabinet said yesterday that it would demand changes to the deal because many senior Iraqi officials worry "that the agreement left too much leeway for the Americans to stay in Iraq beyond the scheduled deadline for withdrawal in 2011."

A state ballot measure to ban gay marriage in California -- Proposition 8 -- is gaining momentum, "with polls showing almost even odds of it passing after trailing by double digits a month ago." "Initial polling showed that a majority of Californians were likely to vote against Proposition 8," but now "the measure is favored 48% to 45% among likely voters questioned in an Oct. 17 poll by Survey USA."

And finally: South Park Republicans are more than just a political theory. New Nielsen data show that "South Park" is, in fact, the show that most engages Republicans, followed by "Cash Cab" on the Discovery Channel and "Damages" on FX. For Democrats, "The Colbert Report" was no. 1, beating out Discovery's "Deadliest Cash."

Good News

Election officials in states with early voting are reporting record turnout, indicating the possibility that "a record percentage of voters could participate in the presidential election."

State Watch

OHIO: State's election website hacked.

ENVIRONMENT: "More frequent and powerful hurricanes from the Atlantic Ocean and Gulf of Mexico since the mid-1990s have created one of the most dangerous and costliest storm eras in recorded history."

CIVIL RIGHTS: U.S. Census Bureau is working with Native Americans to make sure native populations are counted fully in 2010.

Blog Watch

THINK PROGRESS: Fox News' Bill O'Reilly: New York Times's ombudsman is "blatantly dishonest" for using "far left" Think Progress as "a primary source."

WONK ROOM: Minority groups such as Christians have suffered in Iraq.

YGLESIAS: In the annals of spin, Rep. Michele Bachmann (R-MN) introduces us to the subtleties of universal quantification.

WASHINGTON MONTHLY: More economic trouble ahead due to credit card debt.

Daily Grill

"Our enemies will test the new president early."
-- Sen. Joe Lieberman (I-CT), 06/29/08

VERSUS

"[I]t is not uniformly the case that the mettle of American presidents is tested."
-- Former New York City mayor Rudy Giuliani, 10/20/08