"(John Boehner’s plan for raising the debt limit) would lead to the greatest increase in poverty and hardship produced by any law in modern U.S. history”
- Budget analyst
Franklin D. Roosevelt (my favorite President) in 1936…think how applicable this is today…and what a contrast it is to current Democrats in leadership positions:
- Budget analyst
Franklin D. Roosevelt (my favorite President) in 1936…think how applicable this is today…and what a contrast it is to current Democrats in leadership positions:
“In 1776 the fight was for Democracy in Taxation. In 1936 there is still the fight. Mister Justice Oliver Wendell Holmes once said ‘taxes are the prices we pay for civilized society’. One sure way to determine the social conscience of a government is to examine the way taxes are collected and how they are spent. And one sure way to determine the social conscience of an individual is to get his tax reaction. Taxes, after all are the dues we pay for the privilege of membership in an organized society. And as society becomes more civilized government, national and state and local, is called on to assume more obligations to its citizens. The privileges of membership in a civilized society are vastly increased in modern times. But I am afraid we still have many who still do not recognize their advantages and want to avoid paying their dues.”
Tax breaks for the wealthy was also a big debate of the time…FDR took that on too:
“To divide fairly among the people the obligation to pay for these benefits has been a major part of our struggle to maintain Democracy in America. Ever since 1776, that struggle has been between two forces; on the one hand there has been a vast majority of citizens who believe the benefits of democracy should be extended and who are willing to pay their fair share to extend them. And on the other hand, there has been a small but powerful group which has fought the extension of these benefits because they did not want to pay a fair share of their cost. That was the lineup in seventeen hundred and seventy-six and it’s the lineup today. And I am confident that once more, in nineteen thirty-six democracy in taxation will win. Here is my principle, and I think it’s yours too; Taxes shall be levied according to ability to pay. That is the only American principle.”
Debt Ceiling Extortion and Budget Debate Update
One thing the news media does do well is cover the horse race, soap opera aspects of politics – as they are with this whole PHONY debt ceiling/deficit crisis charade. So, I don’t think its my primary duty to give you the ins and outs of the strategy going on as it is to break down the narratives and games themselves...with the focus always on the big picture.
Still, it was quite a kabuki dance last night, first with a Democratic President arguing for GIANT cuts in social spending, and then an ASTOUNDINGLY deceitful speech by John Boehner signaling he's decided to lock arms with the teabaggers warped version of "reality". Talk about bizarro universe! Obama, finally asks people to rally around something: austerity and compromise! Wooo hooo...change we can believe in!!
Granted, its hard to see the debt ceiling not being raised - but we sure are getting close. The question really is how much will Obama and the Dems give up to the Republicans out of fear that they really are as crazy as they appear.
Granted, its hard to see the debt ceiling not being raised - but we sure are getting close. The question really is how much will Obama and the Dems give up to the Republicans out of fear that they really are as crazy as they appear.
Even if you actually believe Obama is some brilliant tactician, and by offering up the big three programs (social security, Medicare, Medicaid) he simply was seeking to show the GOP’s real motives aren’t about the deficit, but about beating him (because he knew they wouldn’t take the deal) or not (the problem is that he DID offer up those programs and has ARGUED for doing so), we’re still going to be stuck with an awful budget.
My hope is that the debt ceiling will be raised on a stand alone vote and no budget is agreed on at all…that way we can continue that debate on its own, for the next few weeks or so, and make the Progressive case to the American public for new revenues and the need to protect the big three (and more).
As for the latest deal that appears to be gaining momentum, through Harry Reid, it would satisfy two key Republican demands: sustains the dollar-for-dollar relationship between spending cuts and an increase in the debt limit, and it would not include any revenue increases. In other words, it’s awful…but not as awful as the Gang of Six proposal because it would “only” be $2.7 in spending cuts, including gimmicks like scoring a draw down from Iraq and Afghanistan in such a way that it saves $1 trillion over ten years.
As David Dayen explains, “So where would the other $1.7 trillion come from? As the New York Times reports, not from Social Security, Medicare or Medicaid. So the likely scenario is that they come from $1-$1.2 trillion of agreed-to cuts in discretionary spending, a by-product of the Biden talks; perhaps $200 billion or so from mandatory non-health spending, perhaps Ag subsidies or federal employee pensions; and the rest from foregone interest payments. Clearly, the one key component of this plan is that it protects Medicare, Medicaid and Social Security. This, at least, walks us back from what would have been an historic defeat for our country and people.
Dayen also points out what I have been for some time, “…the debt limit deal was lost in December, when the Bush tax cuts were extended without dealing with it. There was always going to be a massive turn to spending cuts, because the tax extension blew another hole in the budget. It was the Norquist strategy of starving the beast, and drowning government in the bathtub. The best that can be said for the Reid plan is, depending on the contours, it may not totally drown government, just waterboard it. And remember, it’s bound to get worse – we still have TWO budgets that Congress has to write before the next election. Fiscal Year 2012 starts at the end of September.”
It’s all conjecture still…and the clock is ticking. Unfortunately, the President appears to be hell bent on establishing himself as the fiscal conservative, and the reasonable guy in the room, for the 2012 election. He's focusing his entire Presidency on appealing for the votes of a handful of swing voters and independents in key battleground states rather than doing anything of value for the country. Its sick and cynical, but that's what his game is. He feels confident that the GOP is so insane that progressives and the Democratic base will vote for him no matter what he does...and therein lies the conundrum we all must face. I don't think I can vote for him again (i.e. will likely vote Green)...but I live in California...if I lived in Ohio I probably would.
As I have been saying for a long time is now being recognized by others, including Republicans like Bruce Bartlett, who called Obama the Democratic version of Richard Nixon, who was similarly off the reservation of his own party base’s beliefs.
Here's the important point though...I don’t think the President is a weak negotiator anymore (at least not as bad as I though). He simply wants different things than do the people who elected him. And people are beginning to see that. The fact is, HE BELIEVES these programs must be cut! There was never ANY reason to tie deficit reduction to the debt limit. It was clearly HIS DECISION. He wanted a grand bargain to “take deficits off the table” and burnish his "centrist" image from the get go. He was willing to compromise plenty to do that, enough so it confused the entire notion of what was a compromise and what was a belief.
As Digby notes, "... it’s obvious that the Republicans are more right wing than they ever have been and are less likely to agree to anything reasonable than they ever have been before. So the idea that this, of all times, is the right time to do a Grand Bargain is the original error, as we can see by the current negotiations. His vision doesn’t fit the time or the circumstances and he hasn’t changed course [...]
And sadly, even if the deal never materializes, by putting these drastic cuts on the table they are going to become the centrist and conservative baseline going forward. After all, “even the liberal Democrat Barack Obama thought this needed to be done.” I had not heard anything about raising the age of Medicare eligibility before this debate and now it’s everywhere, pushed by the White House and by the health care technocrats who think that everyone should be thrilled to get into the untested Rube Goldberg health care program as soon as they can buy their way in.(If they can afford it.)
Income Disparity and Where the Money Is
I know I always hone in on this, but the fact that it’s NEVER discussed in our current debate or mentioned by EVERY reporter when they’re being told about “shared sacrifice” and the need to cut life sustaining programs for the poor, disabled, and seniors, makes it necessary.
In 2008, the IRS revealed this past May, 400 Americans reported at least $110 million in income on their federal tax returns. These 400 averaged $270.5 million each.
In 1955, by contrast, America’s top 400 averaged — in 2008 dollars — a mere $13.3 million. In other words, the top 400 in 2008 reported incomes that, after taking inflation into account, amounted to more than 20 times the incomes of America’s top 400 a half-century ago.
But 1955’s top 400 didn’t just make far less than 2008’s top 400. The rich in 1955 paid far more of their income in taxes than today’s rich. In 2008, the new IRS data show, the top 400 paid only 18.1 percent of their total incomes in federal income tax. The top 400 in 1955 paid 51.2 percent of their total incomes in tax.
The bottom line: After taxes, and after adjusting for inflation, 2008’s top 400 had a staggering $38.5 billion more left in their pockets than 1955’s most awesomely affluent.
Multiply that near $40 billion by the annual tax savings the rest of America's richest 1 percent have enjoyed over recent years and you have an enormous war chest for waging class war, billions upon billions of dollars available for bankrolling think tanks and candidates and right-wing media.
In 1955, by contrast, America’s top 400 averaged — in 2008 dollars — a mere $13.3 million. In other words, the top 400 in 2008 reported incomes that, after taking inflation into account, amounted to more than 20 times the incomes of America’s top 400 a half-century ago.
But 1955’s top 400 didn’t just make far less than 2008’s top 400. The rich in 1955 paid far more of their income in taxes than today’s rich. In 2008, the new IRS data show, the top 400 paid only 18.1 percent of their total incomes in federal income tax. The top 400 in 1955 paid 51.2 percent of their total incomes in tax.
The bottom line: After taxes, and after adjusting for inflation, 2008’s top 400 had a staggering $38.5 billion more left in their pockets than 1955’s most awesomely affluent.
Multiply that near $40 billion by the annual tax savings the rest of America's richest 1 percent have enjoyed over recent years and you have an enormous war chest for waging class war, billions upon billions of dollars available for bankrolling think tanks and candidates and right-wing media.
In 2007, taxpayers in the nation's top 1 percent actually paid, on average, 22.4 percent of their incomes in federal taxes. If that actual tax burden were to about double to 43.5 percent, the top 1 percenter share of our national after-tax income would still be twice as high as the top 1 percent’s after-tax income share in 1970.
So again I ask: Why are we cutting life sustaining programs for the poor because of a crisis caused by the rich, wall street, wars and tax cuts?
Financial Reform and Wall Street
As I had predicted, one of my major concerns with the financial reform legislation passed last year was that it made lots of promises, but those promises required regulators to do the job, and adequate funding for them to do it. Well, the GOP has been enormously successful in ensuring both of things DON’T happen. Meanwhile, compensation at publicly traded Wall Street firms hit a record $135 billion in 2010, while profits have bounced back.
As Phil Pizzigatti notes, “And while opponents of reform have zealously sought a reprieve for the nation's bankers, perhaps what is most striking is that there has been no reprieve for the American families crushed by the financial irresponsibility in which those bankers engaged. Wages as a share of national income have fallen to their lowest level since the Great Depression while the share going to corporate profits has rebounded to pre-crisis levels. From the second quarter of 2009 through the first quarter of this year, 92% of income growth went to corporate profits while none went to wages. The median pay of CEOs soared by 28 percent in 2010, while the average length of unemployment grew to nine months, the highest since record keeping began in 1948. And, young people across the country attending state universities have faced steep tuition hikes as state budgets collapsed in the wake of the meltdown -- with increases since 2007 of 132% in California, 95% in Arizona, and 54% in Florida.”
As I keep saying…we do face crises in this country…but it’s not long-term deficits or over spending on public programs…its things like foreclosures, unemployment, corporate power and wealth disparity (among others).
And let’s remember how we got here too: From 2001 to 2008, a Republican president took an annual surplus of $86 billion left for him by Bill Clinton and ran up the budget deficit to over half a trillion in a year ($642 billion in 2008). Altogether, George W. Bush blew up the national debt by over $3 TRILLION - then left the bills to Barack Obama.
And by the way, if we do default on the debt…let’s not pay the bankers back first…seems reasonable after all we’ve given them already. As Greg Palast notes, "There's another wrong assumption controlling this debate over debt, that the banks, the debt holders, must be paid. When the bankers and the Chinese and the Saudis lent Bush three trillion dollars for his wild-ass buying party, they were betting, like any investor, on the good faith of the borrower to pay it back."
I haven’t covered this in awhile because its just so depressing…but being that elections are coming again, and the GOP is working overtime to steal yet more elections while making it harder and harder to vote, I do want to update you on breaking news that once again proves what I said back in 2004: Bush DID NOT win the 2004 election…and certainly not Ohio.
Here’s the latest from Brad Blog: The outcome of the 2004 Ohio General Election has always been a thorn in my side. I was tracking it on election night and it never made sense to me. Never. Over time, evidence has emerged that supports the allegation that Ohio's vote data made an unscheduled detour through Chatanooga, TN and during that stop, was doctored to make sure George W. Bush won Ohio and the election.
Until now, the architectural maps and contracts from the Ohio 2004 election were never made public, which may indicate that the entire system was designed for fraud. In a previous sworn affidavit to the court, Spoonamore declared: "The SmarTech system was set up precisely as a King Pin computer used in criminal acts against banking or credit card processes and had the needed level of access to both county tabulators and Secretary of State computers to allow whoever was running SmarTech computers to decide the output of the county tabulators under its control."
Spoonamore also swore that "...the architecture further confirms how this election was stolen. The computer system and SmarTech had the correct placement, connectivity, and computer experts necessary to change the election in any manner desired by the controllers of the SmarTech computers."
Project Censored named the outsourcing of Ohio's 2004 election votes to SmarTech in Chattanooga, Tennessee to a company owned by Republican partisans as one of the most censored stories in the world. This is one story where a picture really is worth a thousand words. Click the thumbnail at the top of the page to see the larger view of the chart. The part you need to pay attention to are the red arrows. They illustrate how the data flow could have been leveraged to tweak results in Bush's direction under the careful oversight of Ken Blackwell, Ohio's corrupt Secretary of State.
SmarTech has an interesting genealogy. It was run by the late Michael Connell, IT guy for Karl Rove and the Bush family. He also ran GovTech, the company contracted by the state of Ohio (Blackwell) to handle the IT aspects of return processing. Connell was closely associated with the Donatelli clan and other notorious Republican bad guys. Read more if can handle it…Plaintiffs' brief (PDF)
VIDEO SECTION
Bernie on CNN…makes it clear the President has betrayed everyone that voted for him…he’s also suggested a challenge to him in the primaries would be good as well..and SO DO IT…run Bernie run!!!!!
Bernie Sanders talks to Keith Olbermann about the budget debate:
Bernie Sanders AGAIN on the Senate floor…
Barney Frank does an OUTSTANDING job explaining the absurdity of cutting programs for the poor and elderly to balance a budget deficit caused by the rich and powerful (and wars):
Just how far the House Republicans are willing to go in their zeal to crush hard working men and women in our unions? Try taking down the FAA…as now 4,000 personnel from Federal Aviation Administration have been furloughed without pay, because they won’t pass an extension of their authorization.
Sen. Al Franken made this anti-gay bigot, Thomas Minnery, look like a blithering idiot by calling him out of his faulty use of a study that he mischaracterized to attack gay couples.
Colbert on GOP Photo ID Restrictions…today’s modern day “poll tax”…all designed to make it harder for democratic voters to vote….
ARTICLE SECTION
Barack Obama is Gutting the Core Principles of the Democratic Party, by Glenn Greenwald
A FEW CLIPS:
In 2005, American liberals achieved one of their most significant political victories of the last decade. It occurred with the resounding rejection of George W Bush's campaign to privatise social security. Barack Obama. The President, in many crucial areas, has done more to subvert and weaken the left's political agenda than a GOP president could have dreamed of achieving. So potent, so overarching, are tribal loyalties in American politics that partisans will support, or at least tolerate, any and all policies their party's leader endorses – even if those policies are ones they long claimed to loathe."
Bush's scheme would have gutted the crux of that entitlement programme by converting it from what it has been since the 1940s – a universal guarantor of minimally decent living conditions for America's elderly – into a Wall Street casino and bonanza.
Bush's scheme would have gutted the crux of that entitlement programme by converting it from what it has been since the 1940s – a universal guarantor of minimally decent living conditions for America's elderly – into a Wall Street casino and bonanza.
Progressive activists and bloggers relentlessly attacked both the plan and underlying premises (the myth that social security faces a "crisis"), spawning nationwide opposition. Only a few months after he unveiled his scheme to great fanfare, Bush was forced to sheepishly withdraw it, a defeat he described as his biggest failure. That victory established an important political fact. While there are very few unifying principles for the Democratic party, one (arguably the primary one) is a steadfast defence of basic entitlement programs for the poor and elderly – social security, Medicare and Medicaid – from the wealthy, corporatised factions that have long targeted them for cuts.
SNIP
This dynamic has repeatedly emerged in numerous contexts. Obama has continued Bush/Cheney terrorism policies – once viciously denounced by Democrats – of indefinite detention, renditions, secret prisons by proxy, and sweeping secrecy doctrines.
He has gone further than his predecessor by waging an unprecedented war on whistleblowers, seizing the power to assassinate U.S. citizens without due process far from any battlefield, massively escalating drone attacks in multiple nations, and asserting the authority to unilaterally prosecute a war (in Libya) even in defiance of a Congressional vote against authorising the war.
And now he is devoting all of his presidential power to cutting the entitlement programs that have been the defining hallmark of the Democratic party since Franklin Roosevelt's New Deal. The silence from progressive partisans is deafening – and depressing, though sadly predictable.
CEOs to Workers: More for Me, Less for You, by Holly Sklar
A FEW CLIPS:
Big company CEOs got a 23 percent raise last year and corporate profits are at record highs. But the minimum wage has less buying power now than in 1956…The last increase in the minimum wage to $7.25 on July 24, 2009 was so little so late it left workers 30 percent below the minimum wage peak of $10.38 in 1968 – $21,590 annually – in 2011 dollars. Today’s retail clerks, health aides, child care workers, restaurant workers, security guards and other minimum wage workers have $6,500 less in annual buying power than their 1968 counterparts.
Big company CEOs got a 23 percent raise last year and corporate profits are at record highs. But the minimum wage has less buying power now than in 1956…The last increase in the minimum wage to $7.25 on July 24, 2009 was so little so late it left workers 30 percent below the minimum wage peak of $10.38 in 1968 – $21,590 annually – in 2011 dollars. Today’s retail clerks, health aides, child care workers, restaurant workers, security guards and other minimum wage workers have $6,500 less in annual buying power than their 1968 counterparts.
SNIP
We didn’t have to go backwards. U.S. income grew $11,684 on average between 1969 and 2008, the year Wall Street drove our economy off a cliff. But there was nothing average about the actual income distribution. Every dime of income growth went to the top 10 percent. Income for the bottom 90 percent declined.
Compare that to the period between 1917 (when the data began) and 1968. Income growth averaged $26,574. The top 10 percent got 31 percent of that growth. The bottom 90 percent got 69 percent. You can’t have a strong middle class or a strong economy if the bottom 90 percent gets none of the nation’s income growth.
If the minimum wage had stayed above the $10.38 value it had in 1968, it would have put upward pressure – rather than downward pressure – on the average worker wage. Wal-Mart and McDonald’s, our nation’s largest employers, couldn’t routinely pay $7.25 or a little above.
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