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It's even worse than it looks: a conversation with Tom Mann and Norm Ornstein
Policy Talks @ the Ford School
Tuesday, November 27, 2012
4:00 PM
-
5:30 PMMichigan Union
530 S. State StreetBallroom
Ann Arbor, MI 48109
Free and open to the public.
Book sales and signing immediately following.
Continue the conversation on Twitter: #policytalks
Thomas Mann (MA '68, PhD '77) and Norman Ornstein (PhD '74) will discuss their most recent book, the New York Times bestseller, It's Even Worse than It Looks: How the American Constitutional System Collided with the New Politics of Extremism. The book takes a comprehensive approach to understanding the current dysfunction in Congress, and provides pragmatic recommendations to remedy it.
From the speakers' bios:
Thomas Mann is the W. Averell Harriman Chair and senior fellow in Governance Studies at The Brookings Institution. He lectures frequently in the United States and abroad on American politics and public policy and is also a regular contributor to newspaper stories and television and radio programs on politics and governance.
Norman Ornstein is a resident scholar at the American Enterprise Institute and weekly columnist at Roll Call. Ornstein led a working group of scholars and practitioners that helped shape the law, known as McCain-Feingold, that reformed the campaign financing system. Mann and Ornstein are co-directors of the AEI-Brookings Election Reform Project.
From the publisher:
Acrimony and hyperpartisanship have seeped into every part of the political process. Congress is deadlocked and its approval ratings are at record lows. America's two main political parties have given up their traditions of compromise, endangering our very system of constitutional democracy. And one of these parties has taken on the role of insurgent outlier; the Republicans have become ideologically extreme, scornful of compromise, and ardently opposed to the established social and economic policy regime.
In It's Even Worse Than It Looks, congressional scholars Thomas Mann and Norman Ornstein identify two overriding problems that have led Congress—and the United States—to the brink of institutional collapse. The first is the serious mismatch between our political parties, which have become as vehemently adversarial as parliamentary parties, and a governing system that, unlike a parliamentary democracy, makes it extremely difficult for majorities to act. Second, while both parties participate in tribal warfare, both sides are not equally culpable. The political system faces what the authors call "asymmetric polarization," with the Republican Party implacably refusing to allow anything that might help the Democrats politically, no matter the cost.
With dysfunction rooted in long-term political trends, a coarsened political culture and a new partisan media, the authors conclude that there is no "silver bullet" reform that can solve everything. But they offer a panoply of useful ideas and reforms, endorsing some solutions, like greater public participation and institutional restructuring of the House and Senate, while debunking others, like independent or third-party candidates. Above all, they call on the media as well as the public at large to focus on the true causes of dysfunction rather than just throwing the bums out every election cycle. Until voters learn to act strategically to reward problem solving and punish obstruction, American democracy will remain in serious danger.
Book sales and signing immediately following.
Continue the conversation on Twitter: #policytalks
Thomas Mann (MA '68, PhD '77) and Norman Ornstein (PhD '74) will discuss their most recent book, the New York Times bestseller, It's Even Worse than It Looks: How the American Constitutional System Collided with the New Politics of Extremism. The book takes a comprehensive approach to understanding the current dysfunction in Congress, and provides pragmatic recommendations to remedy it.
From the speakers' bios:
Thomas Mann is the W. Averell Harriman Chair and senior fellow in Governance Studies at The Brookings Institution. He lectures frequently in the United States and abroad on American politics and public policy and is also a regular contributor to newspaper stories and television and radio programs on politics and governance.
Norman Ornstein is a resident scholar at the American Enterprise Institute and weekly columnist at Roll Call. Ornstein led a working group of scholars and practitioners that helped shape the law, known as McCain-Feingold, that reformed the campaign financing system. Mann and Ornstein are co-directors of the AEI-Brookings Election Reform Project.
From the publisher:
Acrimony and hyperpartisanship have seeped into every part of the political process. Congress is deadlocked and its approval ratings are at record lows. America's two main political parties have given up their traditions of compromise, endangering our very system of constitutional democracy. And one of these parties has taken on the role of insurgent outlier; the Republicans have become ideologically extreme, scornful of compromise, and ardently opposed to the established social and economic policy regime.
In It's Even Worse Than It Looks, congressional scholars Thomas Mann and Norman Ornstein identify two overriding problems that have led Congress—and the United States—to the brink of institutional collapse. The first is the serious mismatch between our political parties, which have become as vehemently adversarial as parliamentary parties, and a governing system that, unlike a parliamentary democracy, makes it extremely difficult for majorities to act. Second, while both parties participate in tribal warfare, both sides are not equally culpable. The political system faces what the authors call "asymmetric polarization," with the Republican Party implacably refusing to allow anything that might help the Democrats politically, no matter the cost.
With dysfunction rooted in long-term political trends, a coarsened political culture and a new partisan media, the authors conclude that there is no "silver bullet" reform that can solve everything. But they offer a panoply of useful ideas and reforms, endorsing some solutions, like greater public participation and institutional restructuring of the House and Senate, while debunking others, like independent or third-party candidates. Above all, they call on the media as well as the public at large to focus on the true causes of dysfunction rather than just throwing the bums out every election cycle. Until voters learn to act strategically to reward problem solving and punish obstruction, American democracy will remain in serious danger.
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Hello everybody and good afternoon. I'm Susan Collins for Joan and Sanford Weill Dean of the Gerald R. Ford's School of Public Policy and I'm delighted to see all of you with us this afternoon. I'm on behalf of the Ford's School community, it is my great pleasure to welcome you all here for another in our series of distinguished lectures, the Policy Talks at the Ford School. We are particularly honored today to have two very distinguished graduates of the University of Michigan, Thomas Mann and Norman Ornstein. Norm Ornstein is a resident scholar at the American Enterprise Institute and the weekly columnist at Roll Call. Tom Mann is a W. Averell Harriman Chair and Senior Fellow in Governance Studies at The Brookings Institution. And I must say that during my own days at Brookings, Tom was a very special colleague and it is a real pleasure to be able to be hosting him this afternoon. Well, separately and together, Tom Mann and Norm Ornstein have for decades produced ground breaking work on the United States Congress on elections and on the American political landscape. They've built a rock solid perspective for nonpartisan analysis and for collaborating across different ideological perspectives. In a very special edition of the magazine, Foreign Policy magazine that actually just hit the newsstands today and I suspect that they know about this but perhaps they don't. They are among the 100 foreign policy leaders and they ranked in at number 46 jointly and so, particularly--
[Applause]
I want you to congratulate them on that. Well their latest book is The New York Times bestseller " It's Even Worse Than It Looks: How the American Constitutional System Collided With the New Politics of Extremism." And in it, Mann and Ornstein explore some of the most critical issues that face our country, namely the hyper partisanship that we have all been reading about and so many of us have had great concerns that seems to continue on and on. The gridlock that's so and thoroughly disenchants so many and so much of the American public with Congress and with so many of the important policy issued of today that seemed to be making very little headway. Well today, we'll hear their thoughts about both the origin of the dysfunction and potential solutions, some of which are very much in the hands of voters and all of us. And in particular, I prodded them to suggest how policy school and policy students might make some in rows in that agenda. Well, at the Ford School, we're very proud of the reputation that our name sake, President Gerald R. Ford had for working across the isle. And in their book, they refer to President Ford as among the group of Republican leaders who were and I quote, pragmatic institutional figures who found ways to work within the system and focused on solving problems. Well that's a model that our faculty and our students really do take very seriously and so much of what we do and so we couldn't be more proud today to be hosting this conversation with experts on that very important set of topics. Tom and Norm had been very generous with their time, they've already met a number of our undergraduates and our faculty as well as delivering their public address today. And they've graciously agreed to take questions and so, you should have received if you were interested a note card when you came in today. Around 4:45, our staff will be coming down the isles to pick up your questions and a member of faculty, Professor Ann Lin as well as two of our graduates students Claire Hutchinson and Kelvin Vuong will be selecting questions and then posing at the end of our session today to both Tom and Norm. And so with that, it is my honor and great pleasure to welcome back to the University of Michigan and to the Ford School, our distinguished speaker today.
[ Applause ]
Thanks so much Susan. For both of us, it's thrilled to be back in Ann Arbor. Many of our friends and mentors and some of our former employees now back as graduates students are here and we're delighted to be associated with Susan and with the Ford School. I actually got to know Gerry Ford much better after he was out of government. Every year, AEI with which I am identified would hold a world forum in Beaver Creek Colorado in which Present Ford would preside. And so every year, I'd spend 3 or 4 days together with him and it was remarkable to watch him well up into his 80's. I think even more informed and lucid than when he had been in government talking to everybody and then you could see all the qualities that made him a role model really for public service. Thank you for mentioning the 100 global leaders at foreign policy that's the good news, the bad news is that Dick and Liz Cheney ended up ahead of us. [Laughter] Don't ask me how. And for mentioning the book which by the way makes a great holiday gift as we enter the holiday season. The timing is good. We are three weeks after the election. We've actually had some other seminal events in between. Just last week we had the 40th anniversary of Sesame Street, and I called up Big Bird, and congratulated him. He said it was big day but no, we are near as big as November the 6th. He had suffered a near death experience going into the election. There is other good news. As of today, Florida has finished counting its votes. [Laughter] And the interestingly, this morning in attic, they found 586 votes for Al Gore. [Laughter] Little too late. The election of course came as a shock to a number of people including of course Mitt Romney himself, Dick Morris, and Karl Rove. I actually saw Karl two days after the election in Erie, Pennsylvania where I followed the amount of platform and commiserated with him, but I said there is some good news to immerge out of this. I've investigated it, it turns out that depression is fully covered under Obama care. [Laughter] So, he will be okay. Of course, he got it all wrong as did Romney's own pollsters and Dick Morris and many others. But, you know, we can't vote too much, the fact is all of us who get involved in public commentary and many of us an academia make predictions. And we aren't always right, and I told Karl that I'd actually--I had a confession to make, I'd been wrong on the vice presidential choice for Mitt Romney. I did not pick Paul Ryan, I was confident in believing that Romney would--would pick Newt Gingrich as his running mate, I thought you got the perfect balance ticket of a Mormon and polygamous. [Laughter] And I was wrong. So, I was wrong about the marijuana initiatives as well, I predicted that they would fail. I figured though that on Wednesday after the election in Colorado and Washington, large numbers of people would wake up and say, "Hey dude, was that election thing like yesterday?" But, it turned out they actually did show up at the poles. We're happy to be here on a beautiful sunny, yet crisp, we've been doing a lot of traveling. Actually, I came just a couple of days ago from Los Angeles where it was 82 and foggy just like Clint Eastwood. [Laughter] And of course as we think back through the sweep of the last year, the highlights of the campaign, Clint Eastwood's appearance of the Republican Convention in Tampa was one of them, the Tampa Convention, of course dominated by the weather, was hurricane Isaac, the weather threats were so severe that Donald Trump cancelled his Bollywood splash in appearance of the convention, nobody every talks about the good things that can come with hurricanes. But my favorite moment at the convention was when I saw reporter interviewing Herman Cain about the weather and ask if he remembered Katrina, and he said, "I don't know her, I've never met her, there's no proof anywhere." [Laughter] There was some overreaction to the threat of the weather, I thought it was a bit much when I saw Rick Santorum at the Tampa zoo gathering up to of every creature, I thought that was maybe a little bit overboard. From there, I went to Charlotte for the Democratic convention. My highlight there actually was picking up campaign buttons, I like when I go to these things, the buttons, you know, they are really interesting and come collectors items, and I scored unusual button there, it had a big picture of Jenna Jameson on it. Now, I know nobody here knows Jenna Jameson is, all right, well obviously one person does. [Laughter] She is the most successfully porn star in America and she had endorsed Mitt Romney saying, "I'm rich so I'm going to vote for Mitt Romney." And the button had a big porn stars for Romney. And I look at the button and I though the Democrats are loosing the porn star vote, this never would have happen under Bill Clinton. [Laughter] So, but I got the button.
[ Applause ]
Susan, thank you so much for your hospitality, you and the Ford School. Feel converse, it just does my heart so much good to see you out there and to think back to my days, our days as graduate students here. It's wonderful to look around the room and see many friends. Many of whom I've already chatted with before we began. Michigan is a great and beautiful university and I think I can speak for Norm in saying how grateful both of us are for it having given us an opportunity to build very unusual but fascinating and rewarding careers, largely in Washington but with the opportunities like this to travel around. Now, this past year has been as fascinating and rewarding as any in our long careers and I'd like to talk to you a little bit about why that is so when might have thought given the obvious dysfunction of American politics the almost disdain and discourage man about Americans and looking at our system that this would, you know, this would hardly be the kind of topic that would engage us in a way that has proven as interesting and rewarding as it has but appearances can be deceiving. Take the election that just ended a couple of weeks ago, you could say 6 billion dollars. The pain of having to listen to all that punditry out of which we manage to garner so little to help us think about our choices on election day or in early voting, all the noise, the sound and fury, and we seem to have ended up where we began. If I'm not mistaken, a 112 Congress the worst Congress ever wrote my colleague or at least his editor and title of his piece as I recall have Barrack Obama Democrat as President, the Democrats controls the Senate and the Republicans in the House.
[ Applause ]
Hello. My name is Claire Hutchinson and on behalf of the students of the Ford School, I'd like to say thanks again for coming today, really enjoyed your talked. So we have quite a few questions from the audience, and the first one is what do you think is the most effective way to fix our problem of Congressional gridlock right now? And we have three kind of suggestions from the audience. One was filibuster reform, the reform of the apportionment of Congressional districts, and the third was the introduction of a strong third party.
We address all of this. You know, half of our book is actually what to do about this. Well, recognizing that there is no panacea, there is no magic bullet. Part of it is it's a cultural problem as much as it is a structural one and changing culture is much harder. There is also a section called bromides to avoid, and we were quite harsh in the book about the third party movement, the Americans Elect movement. Our system is not setup structurally easily to have a third party. It's a very high hurdle to overcome and the idea which I think has been common especially over the last year or so and it was picked up on by major thought leaders and pundits like Tom Friedman was the yearning for somebody riding in on the white horse to change everything. But it's a nightmare if you think about what happens if there's a third party candidate who pulls a plurality of electoral votes or wins at least enough to send it to the house where you'd select the president from the top three by state, what the state having one vote and the third party candidate would have not a single person who would be an adherent there much less the governing difficulties it would follow. We need to look to our parties and what we basically say is we don't want to see a Republican Party disappear we wanted to back as a vibrant important competitive party, but one that is a conservative not a radical party and is a problem solving party. So, that's the first one, redistricting--we thought long and hard for redistricting reform, it's also no panacea. For some of the reasons that Tom mentioned about the way we are sorting ourselves out in the districts, but also once again the culture. It wasn't redistricting that had Bob Benenett one of the five most conservative members of the Senate from Utah unable to win even the ability to run for his own party's nomination because he had work with a Democrat, Ron Wyden to try and find bipartisan health policy. It wasn't redistricting that got Arlan Specter to leave the Republican Party because he couldn't win a statewide nomination in the party that he had been a part of for many decades. So, it's deeper than that. We do believe that some of the ways out of this that were external to the Congress or the politics in Washington, and I would just say first among them we want to make voting easier and we want to win large the electorate. It is not healthy to have a political system where a tiny share of the electorate dominates the process especially the primary and caucus process in choosing the candidates where in framing the choices that we have and I won't spend time going over the things that we would do there, but we can talk about it later if we want to. And on the filibuster, it's been used in ways that it unprecedented in history. It had been a pure weapon of obstruction and it's been a partisan weapon which is not the way it worked in the past. Civil rights issues, it wasn't a partisan issue, it was faction basically, it was conservative Southern Democrats who filibustered civil rights, and voting rights issues and it was a bipartisan majority that overcame them ultimately. This is unusual and different. And reformers called for even though the rule hasn't change since 1975, the practice has in the last 5 or 6 years. But once again, it's no panacea and particularly, if you have the House of Representatives controlled by Republicans, if you made it much easier in the Senate for them to pass legislation, that's not going to solve the problems right now and the way you go about it becomes important as well. But we've been working hand in glove with many Senators, now mostly democrats, we hope that this could be done with some bipartisan support to return the filibuster to what it was originally or at least over many decades use as which is a very rare way for a minority that felt deeply and intensely about an issue of great national significance to bring things to a whole for a while and to focus attention on it. We've gone away from that, there are ways to deal with it. But whether what they're talking about now works problematic.
My name is Kelvin Vuong and I'm the master of public policy candidate at the Fourth School, the next question from our audience, do lobbyist and lobby groups contribute to our current dividing Congress, and how has there role change with regards to this in the past 10 to 20 years?
Lobbyist are source of our problems and absolutely essential participants in the Democratic process, the right to petition government for the redress of grievances is a constitutional right. The fact is without lobbying public policy would be dumber than it often is. When policy makers, legislators desperately need relevant information of problems, and how policies would respond to the particular conditions that that exist out there. But we have this dilemma of the intertwining of interest representation and campaign fundraising. It's so close and its members who are more likely to importune lobbyist to come to their fundraiser and get their pack to make a contribution, they are usually the drivers of this system. You can set up rules dealing with the conflicts of interest. Obviously, there are laws against bribery and extortion. But as Bob Kaiser said, they're so damn much money. And now, to be competitive for subcommittee or committee chairmanship, the important area one has to be known is a good party fund raiser. There's enormous redistribution of resources, so even the many safe members feel obliged to raise a lot of money. And so, they--because the party expects it to then redirect it to competitive suit, so members go looking for money from the people they see and we have no rule as some states too prohibiting fund raising while the legislature is in session, and there are perfectly legal ways of contributing and bundling money and engaging in a whole host of other activities. It's now becoming further complicated since the citizen's united decision with the proliferation of allegedly independent spending only committees which can raise unlimited sums from any source and spend it in campaigns asking their 501c4 affiliates. And there, the problem is more pernicious. I mean if you're a member of Congress from a, you know, a reasonably safe seat, you won with 58 percent of the vote, 60 percent.
All right, the next question is very relevant to a lot of the things that people are thinking of this week up to the end of the year. What are the prospects of the Congress in the Obama administration to be able to come together on a bipartisan agreement on new legislation to avoid the fiscal cliff?
It was interesting to see some of the dynamic of that election and Republicans being stunned by the defeat. It was a particularly interesting phenomenon. I think if they have been realistic, you know, one of the real losers on this campaign was Romney's pollster Neil Newhouse who has become famous. He was a good pollster but he's becomes famous for saying, "This campaign will not be bound by fact checkers." But he also was one of those who told Romney go and ride up until the middle of election that they were going to win and win easily. And if you go and thinking gee, you know, we could win but we may very well lose and it might not even be that close we might lose. You're going to have a different attitude. If you really think you're going to win and win big, and you lose big, it disorients you, it makes you rethink a lot of your own suppositions. And the very direct strategy that we've talked about of using obstruction to try and bring down Obama and then bring on a new team that could implement a revolution went out the window. And that combine with that final week in the Cristie Obama dynamic changed a lot of thinking and changed people on the Republican side in Congress and they're thinking gee, you know, maybe we better get this one out of the way then we'll get immigration out of the way. And then maybe we can find a different stabilization in where we are and where we're going. So, I think the sentiment to do something in this area now is fairly great. But I'll take you back to what we were talking about earlier. The pathologies are still there. And for John Boehner who'd like to cut a deal just to see what it'd like to cut a deal a year ago but couldn't get pass his own leadership team, Eric Cantor and Kevin McCarthy would be among them. Much less the outside force is like Grover Norquist now we may not have quite the same problem with these other leaders. But the fact is if you're going to come up with a deal and we know what the deal is and we know that this is a deal that whatever the ideological gulf every group that has span the spectrum comes up with the same template, 4 trillion dollars over ten years, roughly a third from revenues and then everything else gets a haircut here and there. But to get there means that you're going to be taking on the club for growth and your members are not worried so much about the broader public backlash as they are about what happens in their primaries coming forward. Lift your head out of that foxhole, it gets shut off. So, it's still very difficult to do. The substantive difficulties are enormous as well. You've got to decide how much money you're going to raise out of that 4 trillion. And then how you're going to raise it but in a way that hits the rich significantly more heavily maybe not just by raising rates and that's not easy to do. You got two weeks to come up with the dollar amount and the formula even if you don't have all the specifics and then move some of those pieces around. The way you do it is you pass a new budget with reconciliation instructions so that the committees have to do all that fill in the details a few months down the road. And then you've got to decide if that dollar amount and the formula is enough that you can do commensurate things on the side of entitlements, Medicare, but also possibly social security, and how you're going to deal with the sequestration by coming up with an equivalent amount and cuts in discretionary spending, domestic and defense, but without the mindless across-the-board nature and also without taking it--having it take effect immediately facing it in so that you can have an economy that keeps moving, and you got to deal with the debt limit because otherwise you could do all these and then have another crisis two months down the road. If you have infinitely good will, that's tough to do but it's not there. And now you have the complication of the filibuster where Republicans in the Senate are ready to go to war, go to the mattresses as it were if it's--if their changes made without their participation. So, I think the incentive to come up with a deal is enormous. The business community is involved for the first time. Tom mentioned the business community. They've been a part of the tribal politics and part of them still are, the Chamber of Commerce frankly is still a wholly on subsidiary of the Republican Party. But other business leaders are involved now. The markets are waiting for reaction. But I will be stunned if we have a resolution of this wrapped up with a bow before Christmas, and it's going to be some heavy issues and difficult waters before we get there. And don't be surprised if we end up with something. It can do what happened with TARP, if you recall at a much worst time, we are really just about to go over the edge. And remember that the TARP built put forward by President Bush and his treasury secretary supported by the two presidential candidates and every Congressional leader and every outside figure of substance failed in the House because the House Republicans voted no. Then the Dow drops 750 points. Back then that was a big deal. And they came back and passed it. It would be surprising to me if we didn't have at least one of those setbacks where you get an adverse reaction before they come back to the table and get it done. By the way in this, I would just end by saying it's not just the problem on the Republican side. Every second term president faces enormous challenges from his own base. They think now he is one re-election, he doesn't have to worry about that anymore, we can get everything we want. And they're already hardening positions. This has to be a deal where everybody gives something painful and any deal that gets through the House is probably going to have equal numbers of Democrats and Republicans, getting the Democrats maybe just as difficult as getting Republicans before we're done.
Let me just add a word to that because it's so visible and so important. I mean sort of ironic that it's so important. For the last few years, the sky has been falling we were told because of our runaway deficits and debt, right? Set that aside, never mind. Now the sky is falling because we are cutting deficits too much and too quickly. Well, let me try to get my bearings here and see what the problem is there is some truth to both of those but the exaggeration of each is sort of problematic as well and we need to sort of keep, sort of keep that in mind. Listen, Obama would like nothing better than putting this issue off to the side. That is dealing with it now that it last us for decade and then we get to the real drivers of our fiscal problems, healthcare cause. He would love it because he could move on to things that he thinks are important including research and development, and immigration, and energy policy, and on and on. They are very exciting and interesting things to do instead of this, so I think he'll probably bend over backwards even taking some heat from his party to get something done. But don't ignore the possibility that in the end, it's not an even balance of Democrats and Republicans that the Republicans as a party state dug in but a substantial enough number of them break off to build a cross party, if not bipartisan collision. I don't know how it's going to happen, I know it's going to be difficult, it's going to take longer, it's going to be messy and we're going to have another explanation of how the sky is falling before we get it done.
Okay, changing back towards cycle of political parties. This party polarization in Congress just reflect fundamental differences and beliefs about federal versus state power and is it possible that federal gridlock will create more empowered states with very different policy choices from the state to state?
Well that's a very interesting question. It probably came out of Barry's course on federalism. [Laughter] It's a fascinating question. You know, there's something nice and wanting to believe that the polarization in Congress leading to inaction will see a transfer of authority to state governments where all those state legislatures are operating so wonderfully. The partisan polarization has hit the states certainly in legislative politics. We've seen it in governorships. I guess the only place I see really pragmatic problem solving is in metropolitan areas, you know, in the cities and the broader areas where you actually get business people and universities, labor, and government set various levels working together. I mean they have to trade agenda, they have a genuine economic development agenda. Things are low enough, close enough to the ground that you can't live on ideology. You've got to begin to deal with real practical problems. So, I actually and there's then the case that, you know, we have this interest incession running around. Texas is the hot bed, I want you to know they took an informal vote in Washington and everyone was waiting goodbye to them, you know, inviting them to leave. But listen, there is such variation among states that it's hard, there are clear limits to the degree to which power can be devolved. So I'm skeptical and my ray of hope is with the metropolitan governance.
Let me just add couple of points. One is there are stark ideological differences here but they're not as stark as they seem. There's a lot of talk in the republican side about the Tenth Amendment and the importance of federalism except when Oregon voted in a referendum to have an assisted suicide law, you had and enormous move to try and block it and repeal it. It's we are for the states doing what they want unless they do something we really don't want. And you see the same thing with tort reform. It's--we need a federal step here because we don't like what the states are doing. So, there's--it's not quite us diverse ideologically. The other side of it is that we are going to see vast differences with the states but the states are going to have a tough time of it. They would have had in frankly and much tougher time of it if Mitt Romney had won and the Ryan Budget had been implemented. Cutting Medicare by--Medicaid by 25 to 39 percent and saying now the states can do whatever they want and there'll be magical formulas where they can provide those benefits was nonsense. And the idea now even that states are going to reject as the Supreme Court has allowed them to do, the expansion of Medicaid as part of the Affordable Care Act which means that all of those people who--some of whom are on Medicaid, others who would have gone on who will be uninsured and will be going to emergency rooms into public and community hospitals which will have to pay for them. They're not going to be terribly happy with their states and if we cut back on the loop holes and exemptions in the tax code, the mortgage--excuse me, the municipal bond deduction, if that goes away then states are going to immediately have much higher burrowing cost, 2 percent or more cut a way on the sate local tax deduction, and they're going to have a hard to time raising revenues. It's going to be tough for those states. Some of the states however are going in a very different path and some of that is being governed by the Koch brothers and the Post-Citizens United money. Koch brothers bought Kansas for about 3 million dollars several weeks ago, it was cheap. Because basically they went into Republican primaries and knocked out all the moderate Republicans to elect people who would work with Governor Brownback to turn it into and experiment. And what you're going to see in Kansas is an experiment of whether or more radical set of policies can work. They're doing the same thing and moving in the same direction in Arkansas. And we're going to see some states where you're going to have that federalism of 50 laboratories and we'll see how it works and that may govern in different ways. But otherwise, I think ultimately, many of these governors who've taken more radical postures can't move in that direction if they want to do anything for their states. Because those realities that Tom said will intrude.
This our last question for the day and I think it safe to say that it's the most popular one, we had five from the audience and one on Twitter on this specific topic. So why the Republicans show such loyalty to Grover Norquist No-Tax Pledge, is there a loyalty to cause of polarization or is it just a symptom of it?
I thought it would be boxers or briefs. [Laughter] I'm wrong again. We can both answer that. You know, we did in keen of this book a long piece on the Washington Post Outlook section in which we pointed to a couple of people who have significant responsibility for this tribal dysfunction. One was Newt Gingrich and the other was Grover Norquist. And you can blame Grover only so much. You know, you can't force people to sign pledges or to abide by pledges. But coming up with the idea of a pledge mobilizing people behind it, making it very difficult if you didn't sign it and some of you may remember vaguely even Bob Dole in an early bid for the presidency in a New Hampshire debate being ask about signing a pledge and sort of dancing around it, and being vilified because of basically money was for raising taxes. And that led to a stampede of people willing to sign the pledge and Norquist who got plenty of money from big outside groups who build his own close relationships with Jack Abramoff among others and has prospered with his group but he's used it for enormous leverage as well can't be counted out even now. Even as you get people getting a little distance from him but watch carefully what they're saying as they get there distance from him. Some I think very courageously Saxby Chambliss of Georgia who are already as people lining up to run against to them in a primary. Taking it on when he's up in two years, there's a profile encourage really. But they're all saying, you know, we'll for revenues but they're going from revenues the same way that Mitt Romney he said he would go for revenues. We don't need to, we can't raise rates. We can get it through economic growth by closing some of the loop holes. So, we have yet to see how much they're going to violate that particular pledge and whether he will be discredited enough that he becomes a kind of footnote in history. But it's a key point and it's a key point as well because the Republican Party now in some ways has defined itself through we are the party that wants to cut taxes, under any circumstances we want to cut taxes. And if that gets out to a public amplified by the media into an almost religious belief, that is the one thing to do and if you violate it, you are basically committing apostasy. Overcoming that is enormously difficult, the failure to overcome, it means you can effectively participate in the bargaining table to govern them.
Grover is a entrepreneurial policy and political activist, he really has build something of--that's lasted low these many years. He's a very unassuming, you know, unimpressive person. He's not a party boss but he's clever and he convinces a meeting, a regular meeting of conservative groups who talked together. And these include the groups that raise and spend money independently and in Republican primaries. It's the club for gross that are, that will threaten and if necessary, deliver on their promise to oppose incumbents who violate their pledge to never raise tax rates and never by eliminating deductions or loop holes raise any new net revenue.
I want to add one more thing. We point out in the book, you know, the part of the course in culture that we have where, you know, saying outrageous things brings no sense of approbation or shame. A comment made by Steve Schwartzman who is a billionaire and one of the founders of the Blackstone Group and when the idea of changing the tax rate for carried interest that the hedge funds use up to the same level as other income came up, he lightened it that moved to Hitler invading Poland which is just, you know, over the line and beyond the pale and all the rest of it. But it's a reflection or something else here which is the inequality that we have now which is sharper than we have ever had before. And that group that's not the one percent but the one-tenth of one percent. That includes business leaders now who make 10 to 50 times as much CEOs as their predecessors did 20 years ago. And for whom, you know, the realities of capitalism don't apply. It's not if you succeed, you'll be rewarded, if you fail, you'll be punished. If you succeed, you'll be rewarded, if you fail, you get a golden parachute and you might get even more coming out of it. And the same with people who basically churn money and don't produce anything but can make fortunes has warped I think the sensibilities of the country. And one of the test I think for the Republican Party now and it was interesting to hear Billy Crystal say, you know, why are we tying ourselves to these multimillionaires is to get back to a notion of capitalism, that is a much better notion where you get rewarded for the success and punish for failure and not tie yourselves to a group of people but unfortunately in the Post-Citizens United world, a group of people who even more leverage than they had before, and change the dialogue. If they can do that then they've got a chance I think even with the demographic challenges facing them that this selection made so clear of becoming competitive again. And if they can't then we're still going to see wild distortions in our politics and policy arena but it's not going to be a very pretty picture for them over the long run or for us frankly.
[Applause]
I want you to congratulate them on that. Well their latest book is The New York Times bestseller " It's Even Worse Than It Looks: How the American Constitutional System Collided With the New Politics of Extremism." And in it, Mann and Ornstein explore some of the most critical issues that face our country, namely the hyper partisanship that we have all been reading about and so many of us have had great concerns that seems to continue on and on. The gridlock that's so and thoroughly disenchants so many and so much of the American public with Congress and with so many of the important policy issued of today that seemed to be making very little headway. Well today, we'll hear their thoughts about both the origin of the dysfunction and potential solutions, some of which are very much in the hands of voters and all of us. And in particular, I prodded them to suggest how policy school and policy students might make some in rows in that agenda. Well, at the Ford School, we're very proud of the reputation that our name sake, President Gerald R. Ford had for working across the isle. And in their book, they refer to President Ford as among the group of Republican leaders who were and I quote, pragmatic institutional figures who found ways to work within the system and focused on solving problems. Well that's a model that our faculty and our students really do take very seriously and so much of what we do and so we couldn't be more proud today to be hosting this conversation with experts on that very important set of topics. Tom and Norm had been very generous with their time, they've already met a number of our undergraduates and our faculty as well as delivering their public address today. And they've graciously agreed to take questions and so, you should have received if you were interested a note card when you came in today. Around 4:45, our staff will be coming down the isles to pick up your questions and a member of faculty, Professor Ann Lin as well as two of our graduates students Claire Hutchinson and Kelvin Vuong will be selecting questions and then posing at the end of our session today to both Tom and Norm. And so with that, it is my honor and great pleasure to welcome back to the University of Michigan and to the Ford School, our distinguished speaker today.
[ Applause ]
Thanks so much Susan. For both of us, it's thrilled to be back in Ann Arbor. Many of our friends and mentors and some of our former employees now back as graduates students are here and we're delighted to be associated with Susan and with the Ford School. I actually got to know Gerry Ford much better after he was out of government. Every year, AEI with which I am identified would hold a world forum in Beaver Creek Colorado in which Present Ford would preside. And so every year, I'd spend 3 or 4 days together with him and it was remarkable to watch him well up into his 80's. I think even more informed and lucid than when he had been in government talking to everybody and then you could see all the qualities that made him a role model really for public service. Thank you for mentioning the 100 global leaders at foreign policy that's the good news, the bad news is that Dick and Liz Cheney ended up ahead of us. [Laughter] Don't ask me how. And for mentioning the book which by the way makes a great holiday gift as we enter the holiday season. The timing is good. We are three weeks after the election. We've actually had some other seminal events in between. Just last week we had the 40th anniversary of Sesame Street, and I called up Big Bird, and congratulated him. He said it was big day but no, we are near as big as November the 6th. He had suffered a near death experience going into the election. There is other good news. As of today, Florida has finished counting its votes. [Laughter] And the interestingly, this morning in attic, they found 586 votes for Al Gore. [Laughter] Little too late. The election of course came as a shock to a number of people including of course Mitt Romney himself, Dick Morris, and Karl Rove. I actually saw Karl two days after the election in Erie, Pennsylvania where I followed the amount of platform and commiserated with him, but I said there is some good news to immerge out of this. I've investigated it, it turns out that depression is fully covered under Obama care. [Laughter] So, he will be okay. Of course, he got it all wrong as did Romney's own pollsters and Dick Morris and many others. But, you know, we can't vote too much, the fact is all of us who get involved in public commentary and many of us an academia make predictions. And we aren't always right, and I told Karl that I'd actually--I had a confession to make, I'd been wrong on the vice presidential choice for Mitt Romney. I did not pick Paul Ryan, I was confident in believing that Romney would--would pick Newt Gingrich as his running mate, I thought you got the perfect balance ticket of a Mormon and polygamous. [Laughter] And I was wrong. So, I was wrong about the marijuana initiatives as well, I predicted that they would fail. I figured though that on Wednesday after the election in Colorado and Washington, large numbers of people would wake up and say, "Hey dude, was that election thing like yesterday?" But, it turned out they actually did show up at the poles. We're happy to be here on a beautiful sunny, yet crisp, we've been doing a lot of traveling. Actually, I came just a couple of days ago from Los Angeles where it was 82 and foggy just like Clint Eastwood. [Laughter] And of course as we think back through the sweep of the last year, the highlights of the campaign, Clint Eastwood's appearance of the Republican Convention in Tampa was one of them, the Tampa Convention, of course dominated by the weather, was hurricane Isaac, the weather threats were so severe that Donald Trump cancelled his Bollywood splash in appearance of the convention, nobody every talks about the good things that can come with hurricanes. But my favorite moment at the convention was when I saw reporter interviewing Herman Cain about the weather and ask if he remembered Katrina, and he said, "I don't know her, I've never met her, there's no proof anywhere." [Laughter] There was some overreaction to the threat of the weather, I thought it was a bit much when I saw Rick Santorum at the Tampa zoo gathering up to of every creature, I thought that was maybe a little bit overboard. From there, I went to Charlotte for the Democratic convention. My highlight there actually was picking up campaign buttons, I like when I go to these things, the buttons, you know, they are really interesting and come collectors items, and I scored unusual button there, it had a big picture of Jenna Jameson on it. Now, I know nobody here knows Jenna Jameson is, all right, well obviously one person does. [Laughter] She is the most successfully porn star in America and she had endorsed Mitt Romney saying, "I'm rich so I'm going to vote for Mitt Romney." And the button had a big porn stars for Romney. And I look at the button and I though the Democrats are loosing the porn star vote, this never would have happen under Bill Clinton. [Laughter] So, but I got the button.
[ Applause ]
Susan, thank you so much for your hospitality, you and the Ford School. Feel converse, it just does my heart so much good to see you out there and to think back to my days, our days as graduate students here. It's wonderful to look around the room and see many friends. Many of whom I've already chatted with before we began. Michigan is a great and beautiful university and I think I can speak for Norm in saying how grateful both of us are for it having given us an opportunity to build very unusual but fascinating and rewarding careers, largely in Washington but with the opportunities like this to travel around. Now, this past year has been as fascinating and rewarding as any in our long careers and I'd like to talk to you a little bit about why that is so when might have thought given the obvious dysfunction of American politics the almost disdain and discourage man about Americans and looking at our system that this would, you know, this would hardly be the kind of topic that would engage us in a way that has proven as interesting and rewarding as it has but appearances can be deceiving. Take the election that just ended a couple of weeks ago, you could say 6 billion dollars. The pain of having to listen to all that punditry out of which we manage to garner so little to help us think about our choices on election day or in early voting, all the noise, the sound and fury, and we seem to have ended up where we began. If I'm not mistaken, a 112 Congress the worst Congress ever wrote my colleague or at least his editor and title of his piece as I recall have Barrack Obama Democrat as President, the Democrats controls the Senate and the Republicans in the House.
[ Applause ]
Hello. My name is Claire Hutchinson and on behalf of the students of the Ford School, I'd like to say thanks again for coming today, really enjoyed your talked. So we have quite a few questions from the audience, and the first one is what do you think is the most effective way to fix our problem of Congressional gridlock right now? And we have three kind of suggestions from the audience. One was filibuster reform, the reform of the apportionment of Congressional districts, and the third was the introduction of a strong third party.
We address all of this. You know, half of our book is actually what to do about this. Well, recognizing that there is no panacea, there is no magic bullet. Part of it is it's a cultural problem as much as it is a structural one and changing culture is much harder. There is also a section called bromides to avoid, and we were quite harsh in the book about the third party movement, the Americans Elect movement. Our system is not setup structurally easily to have a third party. It's a very high hurdle to overcome and the idea which I think has been common especially over the last year or so and it was picked up on by major thought leaders and pundits like Tom Friedman was the yearning for somebody riding in on the white horse to change everything. But it's a nightmare if you think about what happens if there's a third party candidate who pulls a plurality of electoral votes or wins at least enough to send it to the house where you'd select the president from the top three by state, what the state having one vote and the third party candidate would have not a single person who would be an adherent there much less the governing difficulties it would follow. We need to look to our parties and what we basically say is we don't want to see a Republican Party disappear we wanted to back as a vibrant important competitive party, but one that is a conservative not a radical party and is a problem solving party. So, that's the first one, redistricting--we thought long and hard for redistricting reform, it's also no panacea. For some of the reasons that Tom mentioned about the way we are sorting ourselves out in the districts, but also once again the culture. It wasn't redistricting that had Bob Benenett one of the five most conservative members of the Senate from Utah unable to win even the ability to run for his own party's nomination because he had work with a Democrat, Ron Wyden to try and find bipartisan health policy. It wasn't redistricting that got Arlan Specter to leave the Republican Party because he couldn't win a statewide nomination in the party that he had been a part of for many decades. So, it's deeper than that. We do believe that some of the ways out of this that were external to the Congress or the politics in Washington, and I would just say first among them we want to make voting easier and we want to win large the electorate. It is not healthy to have a political system where a tiny share of the electorate dominates the process especially the primary and caucus process in choosing the candidates where in framing the choices that we have and I won't spend time going over the things that we would do there, but we can talk about it later if we want to. And on the filibuster, it's been used in ways that it unprecedented in history. It had been a pure weapon of obstruction and it's been a partisan weapon which is not the way it worked in the past. Civil rights issues, it wasn't a partisan issue, it was faction basically, it was conservative Southern Democrats who filibustered civil rights, and voting rights issues and it was a bipartisan majority that overcame them ultimately. This is unusual and different. And reformers called for even though the rule hasn't change since 1975, the practice has in the last 5 or 6 years. But once again, it's no panacea and particularly, if you have the House of Representatives controlled by Republicans, if you made it much easier in the Senate for them to pass legislation, that's not going to solve the problems right now and the way you go about it becomes important as well. But we've been working hand in glove with many Senators, now mostly democrats, we hope that this could be done with some bipartisan support to return the filibuster to what it was originally or at least over many decades use as which is a very rare way for a minority that felt deeply and intensely about an issue of great national significance to bring things to a whole for a while and to focus attention on it. We've gone away from that, there are ways to deal with it. But whether what they're talking about now works problematic.
My name is Kelvin Vuong and I'm the master of public policy candidate at the Fourth School, the next question from our audience, do lobbyist and lobby groups contribute to our current dividing Congress, and how has there role change with regards to this in the past 10 to 20 years?
Lobbyist are source of our problems and absolutely essential participants in the Democratic process, the right to petition government for the redress of grievances is a constitutional right. The fact is without lobbying public policy would be dumber than it often is. When policy makers, legislators desperately need relevant information of problems, and how policies would respond to the particular conditions that that exist out there. But we have this dilemma of the intertwining of interest representation and campaign fundraising. It's so close and its members who are more likely to importune lobbyist to come to their fundraiser and get their pack to make a contribution, they are usually the drivers of this system. You can set up rules dealing with the conflicts of interest. Obviously, there are laws against bribery and extortion. But as Bob Kaiser said, they're so damn much money. And now, to be competitive for subcommittee or committee chairmanship, the important area one has to be known is a good party fund raiser. There's enormous redistribution of resources, so even the many safe members feel obliged to raise a lot of money. And so, they--because the party expects it to then redirect it to competitive suit, so members go looking for money from the people they see and we have no rule as some states too prohibiting fund raising while the legislature is in session, and there are perfectly legal ways of contributing and bundling money and engaging in a whole host of other activities. It's now becoming further complicated since the citizen's united decision with the proliferation of allegedly independent spending only committees which can raise unlimited sums from any source and spend it in campaigns asking their 501c4 affiliates. And there, the problem is more pernicious. I mean if you're a member of Congress from a, you know, a reasonably safe seat, you won with 58 percent of the vote, 60 percent.
All right, the next question is very relevant to a lot of the things that people are thinking of this week up to the end of the year. What are the prospects of the Congress in the Obama administration to be able to come together on a bipartisan agreement on new legislation to avoid the fiscal cliff?
It was interesting to see some of the dynamic of that election and Republicans being stunned by the defeat. It was a particularly interesting phenomenon. I think if they have been realistic, you know, one of the real losers on this campaign was Romney's pollster Neil Newhouse who has become famous. He was a good pollster but he's becomes famous for saying, "This campaign will not be bound by fact checkers." But he also was one of those who told Romney go and ride up until the middle of election that they were going to win and win easily. And if you go and thinking gee, you know, we could win but we may very well lose and it might not even be that close we might lose. You're going to have a different attitude. If you really think you're going to win and win big, and you lose big, it disorients you, it makes you rethink a lot of your own suppositions. And the very direct strategy that we've talked about of using obstruction to try and bring down Obama and then bring on a new team that could implement a revolution went out the window. And that combine with that final week in the Cristie Obama dynamic changed a lot of thinking and changed people on the Republican side in Congress and they're thinking gee, you know, maybe we better get this one out of the way then we'll get immigration out of the way. And then maybe we can find a different stabilization in where we are and where we're going. So, I think the sentiment to do something in this area now is fairly great. But I'll take you back to what we were talking about earlier. The pathologies are still there. And for John Boehner who'd like to cut a deal just to see what it'd like to cut a deal a year ago but couldn't get pass his own leadership team, Eric Cantor and Kevin McCarthy would be among them. Much less the outside force is like Grover Norquist now we may not have quite the same problem with these other leaders. But the fact is if you're going to come up with a deal and we know what the deal is and we know that this is a deal that whatever the ideological gulf every group that has span the spectrum comes up with the same template, 4 trillion dollars over ten years, roughly a third from revenues and then everything else gets a haircut here and there. But to get there means that you're going to be taking on the club for growth and your members are not worried so much about the broader public backlash as they are about what happens in their primaries coming forward. Lift your head out of that foxhole, it gets shut off. So, it's still very difficult to do. The substantive difficulties are enormous as well. You've got to decide how much money you're going to raise out of that 4 trillion. And then how you're going to raise it but in a way that hits the rich significantly more heavily maybe not just by raising rates and that's not easy to do. You got two weeks to come up with the dollar amount and the formula even if you don't have all the specifics and then move some of those pieces around. The way you do it is you pass a new budget with reconciliation instructions so that the committees have to do all that fill in the details a few months down the road. And then you've got to decide if that dollar amount and the formula is enough that you can do commensurate things on the side of entitlements, Medicare, but also possibly social security, and how you're going to deal with the sequestration by coming up with an equivalent amount and cuts in discretionary spending, domestic and defense, but without the mindless across-the-board nature and also without taking it--having it take effect immediately facing it in so that you can have an economy that keeps moving, and you got to deal with the debt limit because otherwise you could do all these and then have another crisis two months down the road. If you have infinitely good will, that's tough to do but it's not there. And now you have the complication of the filibuster where Republicans in the Senate are ready to go to war, go to the mattresses as it were if it's--if their changes made without their participation. So, I think the incentive to come up with a deal is enormous. The business community is involved for the first time. Tom mentioned the business community. They've been a part of the tribal politics and part of them still are, the Chamber of Commerce frankly is still a wholly on subsidiary of the Republican Party. But other business leaders are involved now. The markets are waiting for reaction. But I will be stunned if we have a resolution of this wrapped up with a bow before Christmas, and it's going to be some heavy issues and difficult waters before we get there. And don't be surprised if we end up with something. It can do what happened with TARP, if you recall at a much worst time, we are really just about to go over the edge. And remember that the TARP built put forward by President Bush and his treasury secretary supported by the two presidential candidates and every Congressional leader and every outside figure of substance failed in the House because the House Republicans voted no. Then the Dow drops 750 points. Back then that was a big deal. And they came back and passed it. It would be surprising to me if we didn't have at least one of those setbacks where you get an adverse reaction before they come back to the table and get it done. By the way in this, I would just end by saying it's not just the problem on the Republican side. Every second term president faces enormous challenges from his own base. They think now he is one re-election, he doesn't have to worry about that anymore, we can get everything we want. And they're already hardening positions. This has to be a deal where everybody gives something painful and any deal that gets through the House is probably going to have equal numbers of Democrats and Republicans, getting the Democrats maybe just as difficult as getting Republicans before we're done.
Let me just add a word to that because it's so visible and so important. I mean sort of ironic that it's so important. For the last few years, the sky has been falling we were told because of our runaway deficits and debt, right? Set that aside, never mind. Now the sky is falling because we are cutting deficits too much and too quickly. Well, let me try to get my bearings here and see what the problem is there is some truth to both of those but the exaggeration of each is sort of problematic as well and we need to sort of keep, sort of keep that in mind. Listen, Obama would like nothing better than putting this issue off to the side. That is dealing with it now that it last us for decade and then we get to the real drivers of our fiscal problems, healthcare cause. He would love it because he could move on to things that he thinks are important including research and development, and immigration, and energy policy, and on and on. They are very exciting and interesting things to do instead of this, so I think he'll probably bend over backwards even taking some heat from his party to get something done. But don't ignore the possibility that in the end, it's not an even balance of Democrats and Republicans that the Republicans as a party state dug in but a substantial enough number of them break off to build a cross party, if not bipartisan collision. I don't know how it's going to happen, I know it's going to be difficult, it's going to take longer, it's going to be messy and we're going to have another explanation of how the sky is falling before we get it done.
Okay, changing back towards cycle of political parties. This party polarization in Congress just reflect fundamental differences and beliefs about federal versus state power and is it possible that federal gridlock will create more empowered states with very different policy choices from the state to state?
Well that's a very interesting question. It probably came out of Barry's course on federalism. [Laughter] It's a fascinating question. You know, there's something nice and wanting to believe that the polarization in Congress leading to inaction will see a transfer of authority to state governments where all those state legislatures are operating so wonderfully. The partisan polarization has hit the states certainly in legislative politics. We've seen it in governorships. I guess the only place I see really pragmatic problem solving is in metropolitan areas, you know, in the cities and the broader areas where you actually get business people and universities, labor, and government set various levels working together. I mean they have to trade agenda, they have a genuine economic development agenda. Things are low enough, close enough to the ground that you can't live on ideology. You've got to begin to deal with real practical problems. So, I actually and there's then the case that, you know, we have this interest incession running around. Texas is the hot bed, I want you to know they took an informal vote in Washington and everyone was waiting goodbye to them, you know, inviting them to leave. But listen, there is such variation among states that it's hard, there are clear limits to the degree to which power can be devolved. So I'm skeptical and my ray of hope is with the metropolitan governance.
Let me just add couple of points. One is there are stark ideological differences here but they're not as stark as they seem. There's a lot of talk in the republican side about the Tenth Amendment and the importance of federalism except when Oregon voted in a referendum to have an assisted suicide law, you had and enormous move to try and block it and repeal it. It's we are for the states doing what they want unless they do something we really don't want. And you see the same thing with tort reform. It's--we need a federal step here because we don't like what the states are doing. So, there's--it's not quite us diverse ideologically. The other side of it is that we are going to see vast differences with the states but the states are going to have a tough time of it. They would have had in frankly and much tougher time of it if Mitt Romney had won and the Ryan Budget had been implemented. Cutting Medicare by--Medicaid by 25 to 39 percent and saying now the states can do whatever they want and there'll be magical formulas where they can provide those benefits was nonsense. And the idea now even that states are going to reject as the Supreme Court has allowed them to do, the expansion of Medicaid as part of the Affordable Care Act which means that all of those people who--some of whom are on Medicaid, others who would have gone on who will be uninsured and will be going to emergency rooms into public and community hospitals which will have to pay for them. They're not going to be terribly happy with their states and if we cut back on the loop holes and exemptions in the tax code, the mortgage--excuse me, the municipal bond deduction, if that goes away then states are going to immediately have much higher burrowing cost, 2 percent or more cut a way on the sate local tax deduction, and they're going to have a hard to time raising revenues. It's going to be tough for those states. Some of the states however are going in a very different path and some of that is being governed by the Koch brothers and the Post-Citizens United money. Koch brothers bought Kansas for about 3 million dollars several weeks ago, it was cheap. Because basically they went into Republican primaries and knocked out all the moderate Republicans to elect people who would work with Governor Brownback to turn it into and experiment. And what you're going to see in Kansas is an experiment of whether or more radical set of policies can work. They're doing the same thing and moving in the same direction in Arkansas. And we're going to see some states where you're going to have that federalism of 50 laboratories and we'll see how it works and that may govern in different ways. But otherwise, I think ultimately, many of these governors who've taken more radical postures can't move in that direction if they want to do anything for their states. Because those realities that Tom said will intrude.
This our last question for the day and I think it safe to say that it's the most popular one, we had five from the audience and one on Twitter on this specific topic. So why the Republicans show such loyalty to Grover Norquist No-Tax Pledge, is there a loyalty to cause of polarization or is it just a symptom of it?
I thought it would be boxers or briefs. [Laughter] I'm wrong again. We can both answer that. You know, we did in keen of this book a long piece on the Washington Post Outlook section in which we pointed to a couple of people who have significant responsibility for this tribal dysfunction. One was Newt Gingrich and the other was Grover Norquist. And you can blame Grover only so much. You know, you can't force people to sign pledges or to abide by pledges. But coming up with the idea of a pledge mobilizing people behind it, making it very difficult if you didn't sign it and some of you may remember vaguely even Bob Dole in an early bid for the presidency in a New Hampshire debate being ask about signing a pledge and sort of dancing around it, and being vilified because of basically money was for raising taxes. And that led to a stampede of people willing to sign the pledge and Norquist who got plenty of money from big outside groups who build his own close relationships with Jack Abramoff among others and has prospered with his group but he's used it for enormous leverage as well can't be counted out even now. Even as you get people getting a little distance from him but watch carefully what they're saying as they get there distance from him. Some I think very courageously Saxby Chambliss of Georgia who are already as people lining up to run against to them in a primary. Taking it on when he's up in two years, there's a profile encourage really. But they're all saying, you know, we'll for revenues but they're going from revenues the same way that Mitt Romney he said he would go for revenues. We don't need to, we can't raise rates. We can get it through economic growth by closing some of the loop holes. So, we have yet to see how much they're going to violate that particular pledge and whether he will be discredited enough that he becomes a kind of footnote in history. But it's a key point and it's a key point as well because the Republican Party now in some ways has defined itself through we are the party that wants to cut taxes, under any circumstances we want to cut taxes. And if that gets out to a public amplified by the media into an almost religious belief, that is the one thing to do and if you violate it, you are basically committing apostasy. Overcoming that is enormously difficult, the failure to overcome, it means you can effectively participate in the bargaining table to govern them.
Grover is a entrepreneurial policy and political activist, he really has build something of--that's lasted low these many years. He's a very unassuming, you know, unimpressive person. He's not a party boss but he's clever and he convinces a meeting, a regular meeting of conservative groups who talked together. And these include the groups that raise and spend money independently and in Republican primaries. It's the club for gross that are, that will threaten and if necessary, deliver on their promise to oppose incumbents who violate their pledge to never raise tax rates and never by eliminating deductions or loop holes raise any new net revenue.
I want to add one more thing. We point out in the book, you know, the part of the course in culture that we have where, you know, saying outrageous things brings no sense of approbation or shame. A comment made by Steve Schwartzman who is a billionaire and one of the founders of the Blackstone Group and when the idea of changing the tax rate for carried interest that the hedge funds use up to the same level as other income came up, he lightened it that moved to Hitler invading Poland which is just, you know, over the line and beyond the pale and all the rest of it. But it's a reflection or something else here which is the inequality that we have now which is sharper than we have ever had before. And that group that's not the one percent but the one-tenth of one percent. That includes business leaders now who make 10 to 50 times as much CEOs as their predecessors did 20 years ago. And for whom, you know, the realities of capitalism don't apply. It's not if you succeed, you'll be rewarded, if you fail, you'll be punished. If you succeed, you'll be rewarded, if you fail, you get a golden parachute and you might get even more coming out of it. And the same with people who basically churn money and don't produce anything but can make fortunes has warped I think the sensibilities of the country. And one of the test I think for the Republican Party now and it was interesting to hear Billy Crystal say, you know, why are we tying ourselves to these multimillionaires is to get back to a notion of capitalism, that is a much better notion where you get rewarded for the success and punish for failure and not tie yourselves to a group of people but unfortunately in the Post-Citizens United world, a group of people who even more leverage than they had before, and change the dialogue. If they can do that then they've got a chance I think even with the demographic challenges facing them that this selection made so clear of becoming competitive again. And if they can't then we're still going to see wild distortions in our politics and policy arena but it's not going to be a very pretty picture for them over the long run or for us frankly.
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