On Tuesday, Steny Hoyer (D. Md), the House Majority Leader, gave what was billed as in important speech on the economy and the federal budget. After reading this speech, I now understand why recent polls show Americans increasingly disillusioned by the Democrats’ increasingly indifferent economic stewardship.

Recent polls show the Democrats trailing Republicans in generic Congressional preferences at a time when Republican statements and behavior are increasingly insane, dishonest and destructive, not to mention the pandering to racism and even armed insurrection. So I don’t think Americans are turned off to Democrats because the Republicans have a better message, let alone better policies — in fact they don’t seem to have coherent policies at all.

Congressional Democrats have to work really hard for Americans to view them as a worse choice than Republicans. I’m not about to lay this solely on Hoyer’s House; on many issues, the House has been way ahead of the dysfunctional Senate, and I think Nancy Pelosi and lieutenants deserve some credit for that. But while the Republicans and their media friends have repeatedly lied about and maliciously demonized everything Obama and a Democratic Congress have done, I don’t believe the majority of Americans truly believe all that nonsense. So if those aren’t the reasons for the Democrats’ fall from favor, they might want to consider what they’re actually saying and delivering to voters.

The most recent polls tell us Americans are far more concerned about the economy and jobs than deficits — an entirely sensible view — but somehow, that simple message isn’t getting through to Congress. It’s been clear for a year that we needed another stimulus bill, or a "jobs bill" and massive federal support for devastated state budgets to avoid slashing Medicaid and laying off hundreds of thousands of teachers and other public servants. The Republican answer, delivered by their moral spokesman Rand Paul, is that these people deserve to be layed off, while safety-net measures only encourage laziness. But far too many Democrats — none of whom deserve to be reelected — have voted as if they believe this evil notion. So why should Americans contribute to the DSCC and DCCC to fund these clowns? No one should give these incumbent protection rackets a dime if allegiance to fundamental Democratic principles is not a requirement.

Steny Hoyer’s speech shows why he is a major part of that problem.

Hoyer opens his speech to Third Way (not essentially different from the other two ways) by crediting a Gallup poll that suggested Americans "fear" the US debt almost as much as they fear terrorism. Hoyer thus begins his discussion of US deficits by assuming these two overly hyped and irrational fears should be the basis for US economic policy.

Rotten tomatoes should have begun flying in Hoyer’s direction at that point, but he continued to repeat all of the Republican/Peterson gibberish about how the US deficits lead inexorably to "a stagnant economy, a hobbled government, and a weak national defense," even though later in his speech he gives credit to the stimulus for proving that none of that is true.

More than ever, it’s possible to imagine a government with nothing left to spend on educating our children, on securing our borders, on conducting groundbreaking research.

This is complete nonsense, reinforcing Republican talking points and the billionaire Peterson’s propaganda. But to justify Obama’s "Fiscal Responsibility" ("cat food") Commission, you have to buy the lie that the US "has nothing left" to spend on what the country actually needs unless we take drastic measures to reduce US budget deficits.

To be sure, Hoyer repeats the Administration line that economic recovery should come first and deficit reduction only later, after recovery is assured. But then he abandons that by the end by calling for further budget cuts next year, even though no one is projecting rapid growth or major improvements in unemployment in 2011 or even 2012.

He defends the ARRA (stimulus) and notes correctly that economic growth would be slower and unemployment higher if we hadn’t passed the stimulus. But Hoyer apparently can’t extract from that now proven cause/effect the obvious lesson that until the recovery is solid and unemployment is brought back closer to full employment, we should be doing more stimulus spending, a lot more. We should just stop feeding the irrational "fears" that our childrens’ future will be murdered in their beds by the terrifying national debt.

Hoyer could have ended his speech here, apologizing for the fact he doesn’t understand what he just said and is thus unqualified to be a leader of the Democratic Party. But he didn’t, and it gets worse.

Ever the ideal Beltway "centrist," a euphymism for not being able to articulate a coherent idea of his own, Hoyer tells us that we have to solve the budget deficit problem with a balanced approach that includes both spending cuts and taxes.

But on the revenue/taxes side, he offers no ideas; apparently the Leader is unwilling to identify a single feature or stratum of America’s economy that warrants higher taxes. Instead, his statements about whether to extend or end the Bush tax cuts, either for the wealthy or the middle class, are so couched that the hapless Washington Post’s editors and reporter made two tries to explain them and failed both times. (Do we need the Washington Post?)

On spending cuts, however, Hoyer can’t wait to tell us that entitlements should be cut, because everyone should be part of the "shared sacrifice" essential for fairness. Fairness, of course, would suggest redressing the egregious redistribution of wealth towards the wealthiest 5-10 percent or so, but Hoyer doesn’t mention that. Unwilling in a speech about "balance" and "fairness" to suggest higher taxes on the wealthy and privileged or the end of subsidies for industries that are strangling America, he suggests Social Security and Medicare benefits take a hit, while blaming the choice on the cat food commission. Here’s what Hoyer thinks is a profile in courage:

It isn’t possible to debate and pass a realistic, long-term budget until we’ve considered the bipartisan commission’s deficit-reduction plan, which is expected in December. I believe that Congress must take up and vote on that plan.

“To share sacrifices fairly, and to be politically viable, the commission’s proposal can only have one form: an agreement that cuts spending and raises revenue when the economy recovers.

“On the spending side, we could and should consider a higher retirement age, or one pegged to lifespan; more progressive Social Security and Medicare benefits; and a stronger safety net for the Americans who need it most. We also need the in-depth scrutiny of defense spending that Secretary Gates has demanded.

So, the Democratic House Majority Leader signals to the cat food commission that some form of benefit cuts to older people (or young people not yet worried about becoming old) would be just fine, and he doesn’t suggest how those could be "balanced" by higher taxes. He merely adds, "raising revenue is part of the solution too," and then wanders off in revisionist history.

You’d think a leader of the Democratic Party would start by saying there is no deficit crisis now, that government spending to boost demand and save jobs now is absolutely a good thing and necessary, and that if it weren’t happening, there would be much more unemployment, slower growth and larger private debt. You don’t need a degree in economics to get that borrowing at 2-3 percent interest to save a teacher’s job is better than having a layed-off teacher hang on by maxing out their credit card debt paying 25 percent.

A leader would tell us that any "structural" long-run deficit issue is primarily a function of paying too much money for health care, which is NOT the same thing as excessive entitlement benefits. And a leader would explain that the problem isn’t too many people on Medicare/Medicaid, or people living longer, or providing more worthwhile health care than beneficiaries deserve.

A Democratic leader would explain very clearly that the problem is that the United States pays drug makers, doctors, hospitals and other providers far more money — up to twice as much — than other countries pay for equal or better health care.

A leader faced with incessant lying from the opposition and confusion/complicity from the media would repeat, over an over, that our "long-run budget deficit" problem in Medicare is about what we pay providers and what we pay them to do. To get at that problem, we have to confront not benefits to old people but payments to providers.

We have to take on conflicts of interest, concentrated markets, anti-competitive patents and non-compete agreements, anti-consumer exclusivity protections for drug monopolies excluding generics, special deals with PhRMA and corporate hospitals, automatic "doc fixes" and on and on.

But of course, Steny Hoyer can’t admit any of these truths, because the Democratic Congress bought into "long-run structural deficits" when it and the Administration bought some meaningless campaign contributions with special deals for health care providers and PhRMA. It argued for "bending the curve" but then gave away the largest structural deficit solutions when it took Medicare for all off the table, and when it killed the public option and its ability to force insurers to compete and providers to bargain against a Medicare option. It gave the drug makers multi-year monopoly pricing and shielded them from Medicare negotiations and foreign competition.

Sorry, Steny; you may look half-way sane compared to the idiotic and nihilist Republicans, but the American people are smart enough to figure out you gave away the game — and their money. And now you have the nerve to lecture us on why we need to wait for the cat food commission to give you the political cover to cut Social Security and Medicare benefits? But hey, it’s only for young people who aren’t paying attention.

In aiming to be only slightly less destructive of the middle class than Republicans, Steny Hoyer is running for Minority Leader. I think he’s earned it, but it’s the country that will pay the price.

John Chandley

Update: David Dayen, Ben Nelson and Republicans block jobs bill again

Brad DeLong says Krugman is always right: Against the super-asinine, the gods themselves contend in vain
Dean Baker, The Myth of "Wealthier Seniors" and Cutting Social Security and Medicare

Ezra Klein, US Health Care system: Still bad

Good for Matthew Yglesias for explaining the facts to the Washington Post

The Hill, Steny Hoyer speech to Third Way

HuffPost/Arthur Delaney, Unemployment: Outlook Grim for Jobs Bill

FDL News/David Dayen, Progressive groups mounting challenge to Peterson, Social Security cuts

Dick Durbin blasts Republicans for blocking unemployment extension bill.

NYT, Debate over industry role in educating doctors

Politico/Poll/Barhgava and Gould, Tired Americans want government help