We are starting December with a very heavy rain... it began around midnight last nite and was still raining five minutes ago when I brought the dogs in from their 10:30 AM walk. I expect it to keep raining most of the day. The low spots on our back lot are flooded already and I imagine groundwater rises are happening all over town. I'll find out when I go out to the store a little later.
Contrary to the feeling many of you seem to have, the Democrats can be back on top by Spring if they simply say NO. This Repug Dynasty can be cut quite short simply by saying NO to everything that they want and making them compromise to the Democratic side. For all of the hoopla about Repugs gaining control, it must be remembered that the Repugs only gained control of one chamber. Some of you will say that they gained control of the purse strings and that that is important. Yes it is, but it's also the source of their greatest weakness.
We are spending $2 Billion a week in Afghanistan. If you want to see zeros, that's $2,000,000,000.00 a week. It also means $104 Billion a year.
Meanwhile, we can't afford to keep our education budgets in functional condition. We can't reduce our National Debt. We can't bring down our operating deficit. And we are spending a fortune on foreign servicing (read China) of our debt.
Following up on Chris's diary yesterday, "Real disposable income is the dominant swing voter ideology ", there are a couple of points I'd like to make. First, here's a reconfiguration of the chart from Ezra Klein that Chris linked to, first showing how much impact comes from increases in disposable income [I'll have more to say about this below]:
And then showing how little impact comes from increases in debt level:
Now, these charts only refer to presidential elections, as Chris noted--quoting Andrew Gelman--there's also research showing that disposable income has similar impacts on congressional elections. So it's pretty hard to imagine that there's any way increasing debt will matter more to mid-term voters this year than changes in disposable income will.
This stark juxtaposition vivdly underscores the incredible political stupidity Chris pointed to when he wrote:
Blocking unemployment benefits will result in less money in the hands of voters who are unemployed. Blocking the Medicare "doc fix" will result in less money in the hands of doctors who vote. Blocking an extension of COBRA and a public option will result in voters who have to purchase individual insurance having less money in their hands. Cutting aid to states to prevent layoffs will result in state workers who vote having less money in their hands. Blocking a cap on ATM fees means less money in the hands of voters. Blocking $100 billion in the first stimulus resulted in voters of all sorts having less money in their hands. And that is just a partial list.
As a governing party, if you want to win elections, you have to get more money in the hands of voters than they had the year before. That is simply impossible if your policy focus is on cutting spending, which is the current, dominant mantra of being a "moderate." Those same "moderates" even want to cut Social security and Medicare payments in order to slightly cut the deficit, which would be a truly disastrous electoral move. Talk about taking money out of the hands of voters!
Two things that have taken a lot of heat lately is the Economic Stimulus and the Social Security insurance for America. In front of the federal budget deficit commission he argued that deficit spending is the best way to reduce and stabilize the national debt by stabilizing the economy and creating jobs. Meanwhile, others are defending Social Security against those who would continue to eliminate or privatize it.
Yesterday was the President's Deficit Commission and today is the Peterson summit. The very serious people (who didn't know there was a housing bubble) are telling us that our own government providing benefits to our people is baaaad and very unserious. (Military spending? What's that?)
So what about that deficit, and the Social Security crisis? Always, always keep in mind that the whole bruhaha over Social Security comes out of a strategic plan to get rid of it. As Paul pointed out in his post and as I have written about,
This strategy goes back to a larger Wall Street effort to get rid of Social Security. A 1983 Cato Institute Journal document, "Achieving a Leninist Strategy" by Stuart Butler of Cato and Peter Germanis of Heritage lays it out for us. The document is still available at Cato, and select quotes are available at Plotting Privatization? from Z Magazine. ...
[quotes from the Cato strategy document]
... Every time you hear that "Social Security is going broke" you are hearing a manufactured propaganda point. Every time you hear that "Social Security is a Ponzi scheme" you are hearing a manufactured propaganda point. Every time you hear that "Social Security won't be there for me anyway" " you are hearing a manufactured propaganda point.
Don't fall for it. If they can gut Social Security they stand to make a lot of money but you stand to lose your retirement.
AND never forget that the deficit was also manufactured on purpose, to defund government's ability to regulate business and protect citizens, and to force a shrinking of what the corporate right calls "big government." Government is We, the People making the decisions for ourselves, "big government" is We, the People making more decisions for ourselves. The only alternative is the wealthy and big corporations making the decisions for us instead. Don't fall for it. We didn't have deficits until we cut taxes on the rich.
Is it already too late for America? I'm starting to think that the anti-tax, anti-government conservative movement that started in the mid-70s, elected Reagan and led to the terrible Bush Presidency may have effectively destroyed the country, leaving it bankrupt, corrupt,ungovernable, ruled by a wealthy elite -- and we're only now just starting to realize it. To cover tax cuts we stopped maintaining the infrastructure and started borrowing. To satisfy their hatred of government we increasingly stripped away rule of law, regulation, and belief in one-person-one-vote. We are seeing the consequences of all of that coming back to roost now.
Reagan left us with massive debt and ever-increasing interest payments. Bush left us with $1.3 trillion deficits and a destroyed economy that would force further increases in the borrowing for years - to be blamed on Obama. The "free marketers" gave away our manufacturing base that will take decades and massive capital investment to recover. Obama can try, but it may just be too late to do anything about the borrowing. We need massive investment in jobs and infrastructure, and a national economic/industrial plan. But, with their own Reagan/Bush debt as ammunition, conservative ideologues continue to block every effort at investment to get out of the mess we are in.
After a 25 year career in Washington, Sam Brownback has suddenly become aware of the staggering size of the U.S. debt -- and not a moment too soon, as he's ambitiously seeking the Governor's mansion in Kansas this cycle. The Kansas City Star explains:
...Sam Brownback of Kansas [snip] along with 23 colleagues from both sides of the aisle, believe that the imbalance between spending and revenue is too worrisome to ignore.
But as usual with Brownback it's just another move of political expediciency. Just as Brownback is leaving the Senate he's suddenly rediscovered his inner "fiscal responsibility" just in time for election.
During his time in Congress, a staggering $7 trillion has been added to the U.S. debt -- with hardly a peep in opposition from Kansas' junior Senator. In fact, as I'll detail below, Sam Brownback has been a leading contributor to the problem over the last two decades.
Great News! The good life will soon return to America. Auspiciously, months before the holiday shopping season began, Americans were told that after more than a year of fiscal recession, or what some have characterized as akin to an economic depression, consumers were optimistic. The confidence index and other indicators were much improved. Manufacturing executives assured the public, the engine that drives the free enterprise system was in a "sustainable recovery mode." In the very near future, products, and people's sense of need, would be fabricated again. Everything will be right with the world, economically. Few feared the threat that, long ago, Americans had come to accept. The foundation of a democratic system had eroded in favor of consumption.
A few months ago I would not have been aware of the late economist, Hyman Minsky (1919-1996.) His theory, known as the "Financial Instability Hypothesis (FIH)" was not a matter of public discussion as we watched our economy go directly into the toilet and the recession grow and get more dismal.
Had I known about Minsky, however, I would have seen this coming in the 1980s when the Reaganites began to dismantle government regulation of banks and the investment markets. FIH says hat stability is inherently unstable.
Byron Dorgan (Dem. - North Dakota) was on C-Span this morning to discuss the elements of the Senate's upcoming Credit Card Bill. I'm not sure what he thinks he can accomplish, but at the very least, he is making us aware that the CC companies are big players in the screwing of the American Economy.
No wonder we're all drowning in debt. Over the past 30 years, a college degree has become increasingly necessary for anyone who hopes to earn a middle-class standard of living. Yet over the same period of time, the cost of tuition and fees at public four-year universities has increased ten times faster than the median family income for families with children. That's a crisis of stagnating wages as well as a problem of soaring college costs. Either way, something's got to give.
At the Drum Major Institute, we've been making that point for years (see, for example, former DMI Fellow Maureen Lane's substantial body of work on higher education as a route out of poverty), but the statistics never cease to amaze me. The effort to afford higher education is the essence of the middle-class squeeze. So it makes an excellent subject for Vice President Joe Biden's Middle-Class Task Force.
When the task force convened for its third meeting in St. Louis last week, they followed the now-familiar format. They issued a staff report that defines the problem as the administration sees it; highlights what the administration is already doing to address it; and lays out a potential future path without committing to any new policy initiatives.
The staff report captures the problem beautifully and sets precisely the right goals for the Administration. "The ability to afford a college education without being buried in debt is an important aspiration and a legitimate expectation... for any family in America...The President is committed to making sure that every student has the opportunity to earn a postsecondary credential or degree." So far so good.
The round up of existing accomplishments includes an array of impressive first steps. The value of the maximum Pell Grant is up, and the President wants to shield funding from the vicissitudes of the annual appropriations process; the stimulus includes an expanded tax credit for college tuition; finally, the President's budget proposes to shift student lending away from the pork-laden program to subsidize private lenders and back toward the more efficient Federal Direct Loan program.
The task force is less inspiring when it comes time to suggest next steps. Since the report states that "the Obama administration does not officially endorse all of these ideas, but the task force views them as worth of further analysis" we might expect some expansive thinking. And there are some good - if hazy - ideas in there: bolster community colleges, improve "529" college savings plans, help states cope with economic downturns without cutting college funding. The most intriguing idea involves enabling graduates to pay back their loans at a fixed percentage of their income, so people who pursue less lucrative careers aren't crushed by debt. Still, none of this quite matches the magnitude of the problem.
The reality is, the nation's public colleges and universities have raised tuition and shifted costs from the states onto students and their families in good economic times as well as bad. A critical part of the story about rising public college costs is tremendous public disinvestment from higher education. The policy not only undermines the middle class but harms the nation's economic competitiveness. To reverse course, the federal government should consider how to help states renew their commitment to public colleges and universities. The middle class depends on it.
by Zach Carter, Media Consortium MediaWire Blogger
Progressive media is sounding the alarm on the AIG bonus scandal, demanding that policymakers stop repeating Bush administration mistakes and offering concrete solutions to the dire economic situation those missteps have created.
Former Secretary of Labor Robert Reich describes the bonus insanity in a blog distributed by AlterNet. "Had AIG gone into chapter 11 bankruptcy or been liquidated, as it would have without government aid, no bonuses would ever be paid," Reich writes, noting that institutions like AIG "are no longer within the capitalist system because they are no longer accountable to the market." If AIG is not accountable to the Treasury Secretary of the country that owns an 80% stake in AIG, then the company has unlimited access to taxpayer coffers without being accountable to anyone at all.
By Zach Carter, Media Consortium MediaWire Blogger
President Barack Obama rolled out his highly anticipated federal budget proposal on Thursday, and while the plan represents a dramatic departure from the priorities of the Bush administration, its ultimate impact may be crippled by a counterproductive bank bailout.
As Obama bails out AIG and Citicorp and probably all the automobile companies, we are still not sure where the new jobs will come from... or if they will come at all. We wait to see the massive hirings to fix bridges and highways or the "shovel ready" projects from the states get started.
Yes, It's been about a month and only a couple of weeks with the legislation in place. However, saving AIG seems to be much more important than employment, and maybe it is.
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