Friday, November 19, 2010

The Progressive Argument: one cartoon that says it all

In one image political cartoonist, Steve Greenberg captures the heart of the progressive argument.

cartoon courtesy of

It's time to reframe the conversation 

Monday, November 15, 2010

Social Security, Dead Peasants and Debating the Budget in the Age of Plutonomy – Part 2

But, the flimflam gang returned with a vengeance in our time — the monied interests and political mercenaries who connived to bring on a calamity that lost eleven million Americans their jobs, robbed people of their homes and pensions, and brought the world's economy crashing down. 

But once again, people are organizing and fighting back; as they did in that early Populist Moment that took on the monopolies and financial trusts. The stirrings of a popular insurgency could be seen late this week as thousands marched on Wall Street. These people are angry at the banks that have cost them so dearly and they want reforms to prevent similar disasters in the future. They want to break up the Wall Street oligarchy and require the banks to use their capital to build and revitalize and innovate, to create jobs and security.”
---- Bill Moyers, Bill Moyers Journal , April 2010

Enter …   The Tea Party Movement

Ah, the Tea Party, the populist movement of our era.   A movement with no clear leader but generally associated with political figures like Michelle Bachmann, Rand Paul and off course, Sarah Palin, who wants us all to return to those by-gone days of yesteryear when it was “morning again in America”.

Let’s take a stroll down memory lane and recall another time when a politician ushered in a new . . 
a clip from the film, “Capitalism: A Love Story” 
by Michael Moore

It seems that while it was morning for some, the sun was setting for others which takes us back to the subject Social Security reform.

Without a doubt, the US economy is in a mess and the budget deficit needs to be address asap.  In fact, it should have been address when former President Jimmy Carter warned us, but hindsight is 20/20.   However, I ask again, “when the topic of trimming the federal budget is under discussion, why is a self funding program the first budget item offered up?”   

The Social System make need a tweak here and there but it’s not broken, so why the big rush to fix it?   But don’t take my word that it’s not broken, here are the words of  New York Times Columnist and recipient of a Nobel Prize for Economics,  Paul Krugman:

“Social Security is a government program supported by a dedicated tax, like highway maintenance. Now you can say that assigning a particular tax to a particular program is merely a fiction, but in fact such assignments have both legal and political force. If Ronald Reagan had said, back in the 1980s, “Let’s increase a regressive tax that falls mainly on the working class, while cutting taxes that fall mainly on much richer people,” he would have faced a political firestorm. But because the increase in the regressive payroll tax was recommended by the Greenspan Commission to support Social Security, it was politically in a different box – you might even call it a lockbox – from Reagan’s tax cuts.

The purpose of that tax increase was to maintain the dedicated tax system into the future, by having Social Security’s assigned tax take in more money than the system paid out while the baby boomers were still working, then use the trust fund built up by those surpluses to pay future bills. Viewed in its own terms, that strategy was highly successful.

The date at which the trust fund will run out, according to Social Security Administration projections, has receded steadily into the future: 10 years ago it was 2029, now it’s 2042. As Kevin Drum, Brad DeLong, and others have pointed out, the SSA estimates are very conservative, and quite moderate projections of economic growth push the exhaustion date into the indefinite future.

But the privatizers won’t take yes for an answer when it comes to the sustainability of Social Security. Their answer to the pretty good numbers is to say that the trust fund is meaningless, because it’s invested in U.S. government bonds. They aren’t really saying that government bonds are worthless; their point is that the whole notion of a separate budget for Social Security is a fiction. And if that’s true, the idea that one part of the government can have a positive trust fund while the government as a whole is in debt does become strange.

But there are two problems with their position.

The lesser problem is that if you say that there is no link between the payroll tax and future Social Security benefits – which is what denying the reality of the trust fund amounts to – then Greenspan and company pulled a fast one back in the 1980s: they sold a regressive tax switch, raising taxes on workers while cutting them on the wealthy, on false pretenses. More broadly, we’re breaking a major promise if we now, after 20 years of high payroll taxes to pay for Social Security’s future, declare that it was all a little joke on the public.
But those who insist that we face a Social Security crisis want to have it both ways. Having invoked the concept of a unified budget to reject the existence of a trust fund, they refuse to accept the implications of that unified budget going forward. Instead, having changed the rules to make the trust fund meaningless, they want to change the rules back around 15 years from now: today, when the payroll tax takes in more revenue than SS benefits, they say that’s meaningless, but when – in 2018 or later – benefits start to exceed the payroll tax, why, that’s a crisis. Huh?

I don’t know why this contradiction is so hard to understand, except to echo Upton Sinclair: it’s hard to get a man to understand something when his salary (or, in the current situation, his membership in the political club) depends on his not understanding it.”

And that’s the rub isn’t it.  To paraphrase, it’s hard to get a politician to understand something when his re-election,(or, in the current situation, his party affiliation), depends on his not understanding it.    Said another way,  it’s almost impossible to find politicians who will consistently represent the interests of working Americans when it may cost them campaign financing to do so …

or when there are those behind the scenes pulling their strings.

Of course, there are only a pile of IOU's in the virtual safety deposit box that was supposed to be holding the social security trust.   And the only way to repay the trust would be to not only end the Bush tax cuts to the wealthy but possible increase the tax rate of the upper one percent.  God forbid.

To be continued……

Saturday, November 13, 2010

Social Security, Dead Peasants and Debating the Budget in the Age of Plutonomy – Part 1

“Once upon a time, a whole lot of just plain Americans woke up to realize the economic system was working against them. They had believed in it; they worked hard to make it work for them. They knew its shortcomings but saw in it the way to a decent return for their labor and a better future for their families. Then, one day, calamity struck: The system turned on them. And they discovered that they had been betrayed, bamboozled, by the people at the top. But they didn't hang their heads and turn tail, like a dog whipped by its master. They organized and fought back — millions of them in a grass roots movement for democracy. What they did became known as the Populist Moment, an extraordinary time in our country's history. But, the flimflam gang returned with a vengeance in our time — the monied interests and political mercenaries who connived to bring on a calamity that lost eleven million Americans their jobs, robbed people of their homes and pensions, and brought the world's economy crashing down.”
-- Bill Moyers, Bill Moyers Journal, April 30, 2010


The Republicans have regained control of the Congress.

The main stream media is preaching that the midterm elections were a rejection of the Democrats' “liberal agenda” and a mandate for a return to conservatism.

The Tea Party has announced that they are here and ready to take over ( even if they have to exercise their “second amendment” rights)

Sarah Palin has proclaimed a “new morning in America.”

Liberal Democrats are being blamed for all of the above (even though the Blue Dogs fared much worse on election day than their progressives counterparts)

While The blogosphere is being blamed for everything else; from being overly critical of the White House; to spreading misinformation; and even hoarding the world’s supply of popcorn.

It’s also now obvious to almost everyone that the “monied interests and political mercenaries” are running the show.  Equally obvious is the fact that health care reform, government regulation ( banking industry, EPA), Social Security and Medicare are at the very top of their hit lists.

And, if it’s not true that the plutocrats are calling the shots, it certainly appears that way.

Washington Post Staff Writer Dan Eggen reported on the influence of “outside entities” on the budget process this past Wednesday.  He wrote:

    “The leaders of President Obama's deficit commission sparked criticism from both sides of the political aisle Wednesday for proposing broad cuts to federal programs. But the National Commission on Fiscal Responsibility and Reform has also come under attack for its unusual approach to staffing: Many of its employees aren't employed by the panel at all.  Instead, about one in four commission staffers is paid by outside entities, many of which have strong ideological points of view about how to tackle the deficit.
For example, the salaries of two senior staffers, Marc Goldwein and Ed Lorenzen, are paid by private groups that have previously advocated cuts to entitlement programs. Lorenzen is paid by the Peter G. Peterson Foundation, while Goldwein is paid by the Committee for a Responsible Federal Budget, which is also partly funded by the Peterson group. 
The outsourcing has come under sharp criticism from seniors' organizations and liberal activists, who say the strategy is part of a broader conservative bias favoring painful entitlement cuts over other solutions. The fears of some liberal groups appeared to come true on Wednesday, when the commission's two leaders recommended significant reductions for Social Security and other social-welfare programs. Bruce Reed, the panel's executive director, defended the staffing arrangement as fiscally responsible and said the staff includes a broad range of views. Other staffers paid by outside entities include an analyst from the liberal-leaning Economic Policy Institute and a Clinton administration official who now teaches at Johns Hopkins University, he said. "We've got wonks from across the spectrum who have been working on this issue for years," Reed said. "Every possible voice from left, right or center has a voice on the commission." But Barbara B. Kennelly, a former Democratic House member from Connecticut who heads the National Committee to Preserve Social Security and Medicare, said the commission's staffing structure is "unprecedented" and casts further doubt on its fairness. "Taxpayers fund the commission and they should work independently of Washington lobbyists and power brokers," Kennelly said. "This is the type of shenanigans that average Americans are so upset about right now - that money talks and everyone else is left out”

If you ask the average American citizen, “who in Washington do you trust to reform Social Security?”,  you would probably receive the answer, “no one.”   And they would have more than a few reasons for feeling that way.   It is very hard for most Americans, myself included,  to understand  why an “entitlement program”  which is  funded by a clearly designated tax  (FICA) is always one of the first programs that gets offered up on the political sacrificial alter when the discussion involves federal budget cuts.

Don’t get me wrong, the budget deficit must be addressed and Social Security can not be treated as a sacred cow.  The current US federal budget is unsustainable.   However,  the American public deserves an honest deficit reduction debate that does not treat them like children that need to be shielded from the ugly truth or play on their fears of ending life old and destitute.  The American public also needs to feel our tax dollars have purchased a seat at the table, that someone is representing our interests in the great budget debate,

As Alexander Bolton reported in his article “Social Security reforms could be bombshell for House GOP”

“Republicans who took over the House on pledges to reduce federal spending and get the nation’s budget in order are running into the third rail of U.S. politics.

A draft proposal from the co-chairman of President Obama’s fiscal commission this week put Social Security on the front burner, leading some Democrats to draw a line in the sand. The proposal would raise the retirement age, slightly reduce benefits and raise the cap on income subject to payroll taxes.

While the proposal was drawn up to keep Social Security solvent and not to deal specifically with reducing the nation’s record deficit, Democratic strategists say it will be difficult for Republicans to duck an issue that has caused them political pain in the past.

“It does put them in a tough position,” Mike Lux, a strategist who works with liberal advocacy groups, said of the GOP. “These kinds of proposals, raising the retirement age and cutting benefits, are overwhelmingly unpopular with the American people."

Soon-to-be-Speaker John Boehner (R-Ohio) is on record supporting similar changes to Social Security, as is Rep. Paul Ryan (Wis.), the incoming chairman of the House Budget Committee and rising intellectual star of the House Republican Conference.”

Yes, Social Security and Medicare are the infamous “third rail of U.S. politics” and any discussion of reforming these two programs has been known to be hazardous to political health.  Why?  Because both Republicans and Democrats have a lot of explaining to do to the American people, especially to the baby-boomers who believe that they have paid into the Social Security Trust Fund all of their working lives.

In a post for, “The Truth About the Trust Fund “  Kevin Drum wrote:

“Back in 1983, we made a deal. The deal was this: for 30 years poor people would overpay their taxes, building up the trust fund and helping lower the taxes of the rich. For the next 30 years, rich people would overpay their taxes, drawing down the trust fund and helping lower the taxes of the poor.  Well, the first 30 years are about up. And now the rich are complaining about the deal that Alan Greenspan cut back in 1983.

As it happens, I agree that it was a bad deal. If it were up to me, I'd fund Social Security out of current taxes and leave it at that. But it doesn't matter. Once the deal is made, you can't stop halfway through and toss it out. The rich got their subsidy for 30 years, and soon it's going to be time to raise their taxes and use it to subsidize the poor. Any other option would be an unconscionable fraud”
And a columnist Jay Bookman points out, it is very important to remember 1983.  Bookman writes:

"Note the year 1983. That year, a commission appointed by President Ronald Reagan recommended significant increases in Social Security payroll taxes in order to make the program actuarially sound. The idea, embraced by Congress, was that the additional revenue would be used to build a surplus in the Social Security Trust Fund so that when the Baby Boom generation began to reach retirement age, the money would be there.

Today, that surplus would amount to $2.5 trillion. But notice that word “would.” For more than 25 years, while working people were told that they were paying extra taxes to ensure their retirement security, that surplus tax revenue was actually being siphoned off to run general government operations. In effect, higher Social Security taxes were being used to offset revenue that had been lost to the government when Reagan cut income and corporate taxes, disguising the true fiscal impact of those cuts.

Today, technically, a surplus of $2.5 trillion now sits in the trust fund, ready to be used for Social Security. In reality, the trust fund contains government IOUs that taxpayers today and tomorrow will have to redeem, probably through payeing higher taxes. So here’s the question now before the body politic:

Will taxpayers — and politicians — honor the $2.5 trillion debt that is owed to Social Security and those who paid into it? Or, will they breach that trust by claiming that the debt is too big to be repaid in its entirety, and that benefit cuts will be required?"

 Americans want to know:

Is there a Social Security Trust Fund or not?  And if there is, where did the money go?

The following is a video clip of Congressman Dennis Kucinich discussing the Deficit Committee's  proposed changes to the social security program with Ed Schultz during a recent appearance on The Ed Show.

Well I think that this is as good a place as any to conclude part one of this series.   While this is not intended to be a scholarly tome, in light of the recent proliferation in blogosphere bashing, I must beg your indulgence as I end with brief glossary of a few of the terms that were referenced in this post.  

Talk to you soon

Glossary (not ordered alphabetically)

Social Security:   In the United States,  this term generally refers to the Social Security Act (1935) and its amendments which encompass several social welfare and social insurance programs. The larger and better known programs are:

    * Federal Old-Age (Retirement), Survivors, and Disability Insurance
    * Unemployment benefits
    * Temporary Assistance for Needy Families
    * Health Insurance for Aged and Disabled (Medicare)
    * Grants to States for Medical Assistance Programs (Medicaid)
    * State Children's Health Insurance Program (SCHIP)
    * Supplemental Security Income (SSI)

FICA :  Under the Federal Insurance Contributions Act 12.4% of earned income up to an annual limit must be paid into Social Security, and an additional 2.9% must be paid into Medicare. That limit is $106,800 for 2010.

There are no earned income limits on Medicare taxes -- so even if your salary is well above the cap for Social Security tax, you will still owe Medicare tax on your total earned income.
If you're a wage or salaried employee, you pay only half the FICA bill (6.2% for Social Security plus 1.45% for Medicare), and the tax is automatically withheld. Your employer contributes the other half.

For most people that means 7.65% of their paycheck is withheld and their company pays another 7.65% on their behalf.

If you're self-employed, however, you're expected to cough up both the employee and the employer share of FICA. You are, however, permitted to deduct half of this self-employment tax as a business expense.  (And), if you're self-employed, anticipate having a lot of investment income, are selling property in a given tax year, or don't have enough taxes withheld from your paycheck to cover an influx of non-wage related income (e.g., alimony or rental income), there's a good chance you will need to pay estimated taxes.

The Budget Debate:    how to reduce the US National Debt which is  currently 13.7 trillion dollars

Dead Peasants:  a term used when referring to life insurance policies that companies take out on their employees in which the company ( not a family member ) is the beneficiary

How did it get the name “Dead Peasant” insurance?

Winn Dixie Stores bought life insurance policies on approximately 36,000 of its employees, without their knowledge or consent, and named itself as the policies’ beneficiary. The insurance brokerage firm that placed the policies prepared two memos describing the deceased employees as “Dead Peasants.” These memos were part of the court’s record in a lawsuit in which the United States Court of Appeals for the Eleventh Circuit held that Winn-Dixie’s policies were a sham transaction for federal income tax purposes.

Plutonomy :   The following definition is courtesy of the Wall Street Journal’s, “Wealth Report”.
“Ajay Kapur, global strategist at Citigroup, and his research team came up with the term “Plutonomy” in 2005 to describe a country that is defined by massive income and wealth inequality. According to their definition, the U.S. is a Plutonomy, along with the U.K., Canada and Australia.
In a series of research notes over the past year, Kapur and his team explained that Plutonomies have three basic characteristics.

1. They are all created by “disruptive technology-driven productivity gains, creative financial innovation, capitalist friendly cooperative governments, immigrants…the rule of law and patenting inventions. Often these wealth waves involve great complexity exploited best by the rich and educated of the time.”

2. There is no “average” consumer in Plutonomies. There is only the rich “and everyone else.” The rich account for a disproportionate chunk of the economy, while the non-rich account for “surprisingly small bites of the national pie.” Kapur estimates that in 2005, the richest 20% may have been responsible for 60% of total spending.

3. Plutonomies are likely to grow in the future, fed by capitalist-friendly governments, more technology-driven productivity and globalization.”


Sunday, November 7, 2010

Sunday Funnies: America's Team and America's Politics

Cowboys Stadium photo courtesy of Wikipedia
My friend Bob knows that for most of my adult life (pre Barry Switzer)  I was a devoted Dallas Cowboys fan.  So when the opportunity presents,  he simply cannot resist sharing the most recent jokes about "America's Team."   Friday he sent me these gems. 

The Texas State Police are cracking down on speeders heading into Dallas.  For the first offense, they give you 2 Dallas Cowboy tickets. If you get stopped a second time, they make you use them.

Q. What do you call 47 millionaires around a TV watching the Super Bowl?
A. The Dallas Cowboys

Q. What do the Dallas Cowboys and Billy Graham have in common?
A. They both can make 70,000 people stand up and yell "Jesus Christ!"

Q. How do you keep a Dallas Cowboy out of your yard?
A. Put up a goal post.

Q. What do you call a Dallas Cowboy with a Super Bowl Ring?
A. Old.

Q. What's the difference between the Dallas Cowboys and a dollar bill?
A. You can still get four quarters out of a dollar bill.

Q. How many Dallas Cowboys does it take to win a Super Bowl?
A. Nobody remembers.

Q. What do the Cowboys and possums have in common?
A. Both play dead at home and get killed on the road!

Don't blame me I didn't write these.

And now for a little political humor

Cashocracy by Mark Fiore

The moral of these two stories is:  Money can buy elections but it still can't buy a Super Bowl.  


Thursday, November 4, 2010

Would A Man Tell Another Man to "Calm Down" During An Interview?

Maybe, but I doubt that it would happen quite like this.

The following is a brief clip of MSNBC's afternoon news anchor, Tamron Hall interviewing Republican National Committee Chair Michael Steele

Yes, Ms. Hall made the tragic mistake about which every woman in business and politics has been warned. She showed a little too emotion. And as a result, as Tamron stated at the end of interview, she was told to "calm down like she was a five year old". But come on,
Can you imagine Michael Steele telling Ms. Hall's colleague, Ed Schultz, not one to hold back his emotions, to "calm down"? Or, imagine Eric Cantor making the same patronizing hand gestures to Lawrence O'Donnell when he was being pressed for an answer to the same question, the night before?

John Boehner can cry after a big election win and it's interpreted as an honest display of emotion. Hillary Clinton chokes back tears during the heat of a tough fought political campaign and some interpreted her honest display of emotion as an attempt to manipulate the voters. It's a ridiculous double standard.
However, when women show "too much emotion" or argue a point too passionately it is,more often than not, misunderstood..

Of course Micheal Steele is probably taking lessons on how to handle questions from strong women in media from Dick Armey. Remember when Mr. Armey said to Salon's Joan Walsh, "I am so damn glad that you could never be my wife, 'cause I surely wouldn't have to listen to that prattle from you every day"? Are you kidding?

Maybe the mama grizzlies will give their conservative colleagues a few lessons on how to have a civil, adult, political debate with strong intelligent women without resorting to patronizing, demeaning ......

Oh, who I am kidding?

Wednesday, November 3, 2010

What If? -- Recap of Election Night 2010

It's official. Election Day 2010 is almost over.

The Democrats have retained control of the Senate. The Republicans have regained control of the Congress. The Tea Party made a statement in Kentucky and Florida but their candidates went way too far with their hateful, and often bizarre, rhetoric in Nevada, West Virginia and Delaware. And, in spite of two years of remarkable legislative accomplishments, the Democrats took a beating and so did some of their friends.

Tea Party Candidate, Rand Paul is going to Washington. Floridians turned their back on a really good governor in Charlie Crist. At the time that this is being written, it looks like a write-in candidate is going to win the Senate race in Alaska. And, one of the most honorable men in politics, Senator Russ Feingold went down in defeat (a heartbreaking loss for Wisconsin, Progressives and the hope of real campaign finance reform),

On the other hand, Senate Majority Leader Harry Reid pulled out a hard fought win. Jerry Brown is back at the helm of California.
African Americans. Latinos and young people proved that they DO VOTE. And, mercifully we've all been spared Sarah Palin protege, Christine O'Donnell and years of jokes about witches.

The best tweet of the day was Roseanne Cash's comment about John Boehner's use of her father's memory. The strangest moment on television was Lawrence O'Donnell of MSNBC trying to get an answer to a simple question from Rep. Eric Cantor. The "liberal left" was blamed for Blanche Lincoln's loss in Arkansas. And no modern era election night would be complete if someone didn't complain about the media projecting a race winner too soon.

When it's all said and done, this has been the most expensive non-presidential election year campaign season in history.
The political pundits and campaign managers will be analyzing election results until they're blue in the face. So rather than repeat what you've heard all evening, I'll leave you with this post election reflection.

This election has been all about the economy but
What If?

What if the Obama administration had realized from the beginning that the kids across the aisle just don't play nice?

What if, in 2009, the newly inaugurated Obama administration had responded to calls from the Democratic base ( aka the professional left ) to investigate the misdeeds of the Bush/Cheney administration?

What if for the past two years the American people had been reminded that the Bush administration inherited a budget surplus from the Clinton years which they, in turn, squandered, leaving the largest budget deficit in history?

What if for the past two years the national political dialogue had included a real discussion of the cost of the Iraq war (which was entered into under false pretenses) and how those costs contributed to the national debt?

And what if the American people had been reminded day after day that the corporate friends of Bush/Cheney (Haliburton, Blackwater, KBR, et. al) made billions from the government contracts secured during the wars in Afghanistan and Iraq?

What if the Democrats had reminded the American people that the bank bailout was a parting gift from the Bush administration?

And what if the Democrats had reminded the American people day after day after day that the deregulation policies of the Bush era lead to the housing crisis and the great exodus of US jobs to foreign shores?

What If?

What if the Obama administration and the 111th Congress had realized early in the game that when you have an opponent on the ropes, you keep him there.

Oh well, hindsight is 20/20 and none of us will ever know.

Today's reality is that the Democrats have two years of landmark policy accomplishments to their credit but weren't able to convince much of the American public to stay the course.

Yet, what if, it's true that "what doesn't kill you makes you stronger". As Senator Barbara Boxer told her supporters after winning her bid for re-election, her opponents threw everything at her but the kitchen sink, with money from known and unknown sources. Yet she overcame it all.

So what if, in some strange way, this all works to the Democrats' advantage. After all, now the Republican controlled 112th Congress will have to "man-up" and put up or shut up.
And best of all, the Republicans won't have Nancy Pelosi to demonize in 2012.

What if, having to survive near death political death during campaign 2010, it just what the Democrats' needed to re-energize the base?

What if?

Good night.