M. Wayne Comments

Empire of Illusion - The Barnes & Noble Review

2009-12-08T11:00:00.000-08:00

Empire of Illusion - The Barnes & Noble Review

How Republicans Killed Capitalism

2009-11-15T08:28:00.001-08:00

How Republicans Killed Capitalism

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Daily Kos: State of the Nation

2009-10-30T14:28:00.000-07:00

Daily Kos: State of the Nation

Why Growing Income Inequality Is Bad for America

2009-10-27T11:24:00.000-07:00

Robert Creamer
Political organizer, strategist and author
Posted: October 27, 2009 08:51 AM
Reprinted from The Huffington Post 10/27/09
Why Growing Income Inequality Is Bad for America

The recent controversy over the huge bonuses at financial firms like AIG and J.P. Morgan Chase have served to highlight both the disproportionate growth of the financial sector, and the perverse incentives that led traders and executives to take reckless risks with their companies and our economy.
But they have also shined the spotlight once again on the grave threat posed to our society by the growing income inequality that was the trademark of the last thirty years of our economic history.
Some facts:
* The CEO of the average company in the Standard and Poor's Index makes $10.5 million. That means that before lunch, on the first workday of the year, he (sometimes she) has made more than the minimum wage workers in his company will make all year. That translates to $5,048 per hour -- or about 344 times that pay of the typical American worker.
* Most people would consider a salary of $100,000 per year reasonably good pay. But the average CEO makes that much in the first half-week of the year.
* And that's nothing compared to some of the kings of Wall Street. In 2007, the top 50 hedge and private equity fund managers averaged $588 million in compensation each -- more than 19,000 times as much as the average U.S. worker. And by the way, the hedge fund managers paid a tax rate on their income of only 15% -- far lower than the rate paid by their secretaries.
There is simply no moral or economic justification for this kind of greed. Just as important, growing income inequality is a cancer that is attacking both the economy, and the social and political fabric of our society. A look at economic history makes several things clear.
1) Growth of income inequality does not result from "natural economic laws," as conservatives would like us to believe. It is the result of systems set up by human beings that differentially benefit different groups in the society.
At the beginning of the Great Depression, income inequality, and inequality in the control of wealth, was very high. Then came the "the great compression" between 1929 and 1947. Real wages for workers in manufacturing rose 67% while real income for the richest 1% of Americans fell 17%. This period marked the birth of the American middle class. Two major forces drove these trends -- unionization of major manufacturing sectors, and the public policies of the New Deal that were sparked by the Great Depression.
The growing spending power of everyday Americans spurred the postwar boom of 1947 to 1973. Real wages rose 81% and the income of the richest 1% rose 38%. Growth was widely shared, but income inequality continued to drop.
From 1973 to 1980, everyone lost ground. Real wages fell 3% and income for the richest 1% fell 4%. The oil shocks, and the dramatic slowdown in economic growth in developing nations, took their toll on America and the world economy.
Then came what Paul Krugman calls "the New Gilded Age." Beginning in 1980, there were big gains at the very top. The tax policies of the Reagan administration magnified income redistribution. Between 1980 and 2004, real wages in manufacturing fell 1%, while real income of the richest one percent rose 135%.
Much as they like to tout the magic "natural" effects of the market on levels of wages, conservatives have not been shy about using the power of government to affect the distribution of the fruits of the US economy. They have slashed taxes for the rich and for corporations, and increased the relative tax burden on working people. And by cutting taxes for the rich, they have transferred wealth to the most affluent people in America from all of our children by increasing the federal debt.
2). Increased income inequality is completely unrelated to the relative contribution of various groups in the population to the nation's economic prosperity.
Who could argue that the executives and traders of the Wall Street financial firms, whose reckless speculating ultimately sent our economy into a tailspin, made any meaningful contribution to our economic welfare? Yet they often made hundreds of millions of dollars.
Remember, much of the financial sector does not produce anything. The principal missions of the financial sector are to take on risk and allocate capital effectively. Some in the industry -- especially many community and regional banks -- do just that. But in the last year, the financial sector as a whole didn't "take on risk," it shifted risk to ordinary Americans through gigantic taxpayer bailouts. Many Wall Streeters themselves escaped the recent economic debacle, having salted away hundreds of billions of dollars.
Fundamentally the financial sector is made up of middlemen, who spend their time creating schemes that allow them to funnel society's money through their bank accounts so they can take a sliver of every dollar off of the top.
Right now, the private health insurance industry is busy trying to defend its turf against a public health insurance option. It wants to maintain its "right" to take that tribute off the top of as many health care dollars as possible. Remember, the private health insurance industry doesn't deliver any actual health care.
Does the CEO of CIGNA who is going to retire this year with a $73 million golden parachute contribute more to our well-being than a nurse who actually delivers health care?
The same is true of most of the financial sector, many of whom are essentially professional gamblers. It is the farmers, manufacturing firms, the health care providers, the transportation companies, the guys who sweep up buildings, the cops and firefighters, the people who teach our kids -- those are the people who produce the goods and services that we consume in our economy. The real incomes of these Americans have dropped by $2,197 per year since 2000, while the "bonus party" on Wall Street continues even though these Americas were asked to reach into their jeans and pony up hundreds of billions to bail out Wall Street's catastrophic mistakes.
3). As political scientists Nolan McCarty, Kevin T. Poole and Howard Rosenthal show in their book Polarized America: The Dance of Ideology and Unequal Riches, inequality in income distribution causes political polarization. It divides our society. Their study found that there is a direct relationship between economic inequality and polarization in American politics.
McCarty, Poole and Rosenthal measured political polarization in congressional votes over the last century, and found a direct correlation with the percentage of income received by the top 1% of the electorate.
They also compared the Gini Index of Income Inequality with congressional vote polarization of the last half-century and found a comparable relationship.
Want less political polarization? What a more bi-partisan spirit? Want America to be unified? Want less hatred and violence in our society? History shows that you start by once again compressing the difference in incomes between the very richest and the rest of America.
4). Finally, increased income inequality is completely undemocratic. It is a betrayal of our most fundamental democratic values. And it is dangerous to our prospects for long-term survival.

The increasing inequality of income leads inexorably to increasing inequality in the distribution of wealth. Power in the society is more and more concentrated in the hands of a few. It becomes more and more likely that some of our most powerful citizens came to that station not because of their merit, but because they got it the "old fashion way" -- they inherited it. That is directly contrary to our shared belief in a more democratic society -- where power and opportunity are broadly shared -- where no one's power or station in life are determined by accident of birth.
The earliest Americans came to this continent to escape tyranny, aristocracy and plutocracy.
Progressives who stand up against the increasing concentration of economic power in the hands of a few are standing for one of the proudest traditions of our democracy. And our commitment to the democratic distribution of power is not simply an expression of utopian idealism.
In his brilliant study of why societies in the past have failed, called Collapse: How Societies Choose to Fail or Succeed , Pulitzer Prize-winning physiologist and ethno-geographer Jared Diamond concluded that one of the most common factors was "rational behavior" by actors -- and decision-making elites -- that benefited some individual or private self-interest but was harmful to the prospects of the entire society.
He found that this was often complicated because the benefits to a small group that profited from the action were great in the short run, and the resulting damage to everyone else was not very palpable or immediate, except over time.

This problem became especially acute when elites thought they could insulate themselves from the consequences of communal disaster. Then, they were even less prone to make decisions in the public interest.
The increased inequality in the distribution of wealth and income makes this kind of decision-making more and more likely. We see when the interests of the wealthy stand in the way of solutions to the problems of climate change and environmental destruction -- or when we fail to raise enough money for the public education that benefits all children because the few who can afford private schools refuse to pay "higher taxes."
The creation of a democratic society, built on egalitarian principles, is the only real systematic means of assuring that the interests of the entire society are not sacrificed to those of powerful elites. Most stories of decisions leading to catastrophic collapse involve decision-making elites whose interests diverge from the society at large. Democracy is the only real antidote.
The undemocratic increase in the distribution of wealth and income is not only wrong. It is also dangerous to our future survival.

Robert Creamer is a long time political organizer and strategist, and author of the recent book: "Stand Up Straight: How Progressives Can Win," available on Amazon.com.

Copied from the DailyKos

2009-10-26T12:06:00.000-07:00

Liveblog with Max Blumenthal, Author of "Republican Gomorrah"
by mcjoan
Sun Oct 25, 2009 at 10:00:03 AM PDT

Republican Gomorrah: Inside the Movement that Shattered the Party http://www.amazon.com/gp/product/1568583982?%3Cp%3Eie=UTF8&tag=daikos20&linkCode=as2&camp=1789&creative=9325&creativeASIN=1568583982
By Max Blumenthal
Hardcover: 416 pages, $25
Nation Books: New York
September 2009

This isn't a book for the faint of heart. The deep underbelly of the Republican right is far weirder, and far more disturbing, than most observers recognize. The corruption, the sex scandals, the lust for power--it's all here, presented in a fast-moving romp that's part sociology, part psychology, part gossip column.

But that's gossip in a good way. It's well-documented gossip, not just rumors, and the personal and political stories behind the personalities that fill these pages is critical to the web that Blumenthal constructs, showing the ties that you didn't know existed from notorious serial killer Ted Bundy who James Dobson used to amass part of his forture, to Gary Bauer to Blackwater's Erik Prince to Ralph Reed to Jack Abramoff to Tom Delay to Tony Perkins to David Duke to Tom Coburn to Bill Kristol to Sarah Palin. They're all there, and the story of how all these players have become connected with an extreme and pathological "religious" philosophy to take over the Republican party is fascinating.

Blumenthal explains where the current Republican Party came from, who it's foundational thinkers were, and just why it's still so dangerous. While the conventional wisdom is that the Southern Baptists are at the core of the religious right movement, Blumenthal shows that the movement actually grew out of the works of R.J. Rushdoony, the son of survivors of the Armenian genocide, who devoted his life to nothing less than replacing America's constitutional democracy with a theocracy based on Leviticus case law.

Calling for the literal application of all 613 laws described in the Book of Leviticus, Rushdoony paid special attention to punishments. Instead of serving prison sentences, criminals would be sentenced to indentured servitude, whipped, sold into slavery, or executed."God's government prevails," Rushdoony wrote, "and His alternatives are clear-cut: either men and nations obey His laws, or God invokes the death penalty against them." Those eligible on Rushdooney's long list for execution included disobedient children, unchaste women, apostates, blasphemers, practitioners of witchcraft, astrologers, adulterers, and of course, anyone who engaged in "sodomy or homosexuality."

Burning at the stake, death by "the sword," and hanging were some of Rushdoony's preferred modes of execution. However, his son-in-law Gary North, a self-styled Reconstructionist economist (who eventually fell out wiht his father-in-law) and former adviser to Republican Representative Ron Paul of Texas . . . advocated stoning evildoers to death. Rocks, North argued, are free and plentiful, making them ideal tools for the financially savvy executioner. (pp. 20-11)

Rushdoony's writings influenced people like Bush's faith-based initiatives czar Marvin Olasky and Howard F. Ahmanson Jr., whose vast wealth funded Rushdoony's think tank, as well as a number of intelligent design initiatives and California’s anti-gay Prop 8 initiative. Rushdoony also heavily influenced Francis Schaeffer, a 1960s icon of the Jesus Freak movement who became radicalized with the Roe v. Wade decision and essentially created the violent anti-abortion movement, out of which grew the larger political effort around "values voters," attacking all of the secular underpinnings of America. The rest, essentially, is the political history of the Republican Party for the last 40 years.

Then there's the sex. It might seem that the slightly icky things we've learned about the private lives of everyone from John Ensign to David Vitter to Mark Foley to Ted Haggard are just an entertaining offshoots of the larger movement, but Blumenthal sees more. Drawing from Erich Fromm's Escape from Freedom, about the psychology of Nazism and authoritarianism, and Eric Hoffer's The True Believer, Blumenthal describes the frame of reference for so many of the adherents of this extreme fundamentalist worldview, many of whom were brutalized as children. He desribes it in a discussion with Scott Horton:

Followers of the Christian right openly admit that they have no capacity to restrain themselves from total depravity without constant, stern commandments from an angry God. As Gov. Mark Sanford, an evangelical minister, declared during his recent press conference confessing an extra-marital affair, the "bottom line of God’s law" is to "protect us from ourselves." Senator John Ensign, the only Pentectostal serving in the Senate, attributed his own sexual dalliances to having "walked away from God," or having relied too heavily on his individual will. These figures believe if they don’t do what God supposedly wants them to do they will descend immediately and inevitably into sin and perversion–because that’s what they want to do.

Fromm explained that those who seek to obliterate the self in the drama of an authoritarian crusade have attempted a "neurotic solution" that always leads to self-destructiveness. They use right-wing politics as a form of cheap medication, hoping to cleanse their sullen souls by purging the land of sin. But cheap medication rarely works. Thus none of the recent Republican sex scandals are unique; they are reflective of the sensibility of the movement that took over and shattered the GOP, and which Fromm analyzed so concisely in his 1941 book, Escape From Freedom.

And, by bowing before James Dobson and mouthing the correct words, they find absolution. And, if they aren't gay, political rehabilitation. The cases of David Vitter and Larry Craig are particularly representative of this.

One quibble I've got with Blumenthal--his assertion in the book's title that by allowing itself to be subsumed by the religious right, the Republican party has shattered. It hasn't yet, and Blumenthal's own book shows the danger that the nation is still in as long as the American body politic--and opinion makers and political leaders--underestimate the degree to which this mindset has taken over the Republican party. Torture wasn't just the outgrowth of Dick Cheney's personal evil, it was the inevitable result of the "Holy War" the administration was waging.

Without a real understanding or acceptance of the extremism, of the radical and violent nature (which is bubbling up more and more frequently since Sarah Palin unleashed the beast during the 2008 campaign) of what is now the Republican base, we carry on as if the Republican party was operating as the counterpoint to the Democratic party, as if it were somehow still the "loyal opposition," and not fundamentally committed to the radical overthrow of secular America. Bargaining with the Republicans in Congress as if they were partners in governing America is a very bad bet.

I've saved some of the more fun stuff, particularly Max's great expose work from Alaska on Sarah Palin, for him to talk about. Join us in the comments.

Permalink :: Discuss (357 comments, 357 new)

U.S. Health Care

2009-10-12T07:26:00.000-07:00

The Great Health Insurance Scam
by tmaertens
The Great Health Insurance ScamIn 2005, William McGuire, as CEO of UnitedHealth Group, received compensation of $124.8 million, according to Forbes. In 2006, The Wharton School estimated the value of his options package at $1.6 billion.
For $1.6 billion, he must have revolutionized health care, right?
But United Health doesn’t treat illness, doesn’t perform surgery, doesn’t provide health care of any kind. Neither does any other health insurance company.
Their principal goal is not to provide health care at all. It is just the opposite; to provide as little health care as possible in order to maximize profits and reward their executives and shareholders.
To do this, they ration health care to the healthiest, weeding out anyone who might actually need health care.
tmaertens's diary :: ::
In addition, they limit "insurance losses" by refusing claims, contesting expenses, imposing lifetime limits on care, limiting the payout per illness, requiring prior authorizations for treatment, and shredding your coverage with ever more exclusions.
What UnitedHealth really revolutionized is the audacity with which they invoked the fine print in the policy to cancel costly clients, the ones who have become chronically or catastrophically sick, and the rate at which they deny claims. The California Nurses Association found that UnitedHealth’s PacifiCare subsidiary rejected 39.6% of all claims. They paid employees, and even awarded bonuses, for rejecting claims and terminating patients with chronic illnesses.

In addition, because of their near monopolies, insurance companies can raise premiums at will. The American Medical Assn. found in a 2007 survey that a single insurer had a 50% or more share of the conventional insurance market in 76% of the country...including most major metropolitan areas.
This gives the companies enormous power to drive up premiums and other costs. The two largest insurers, WellPoint and UnitedHealth Group, each acquired 11 other insurers between 2000 and 2007 and now control a total of 67 million "covered lives." This is one reason insurance premiums have doubled in the last seven years.
The same factor...lack of competition...allows health insurance companies to raise co-pays and increase deductibles at will.
Despite the insurance companies’ propaganda, it’s the government that does all the health care heavy lifting, funding Medicare for old people and the disabled, Medicaid for poor people, the VA for veterans, DOD/TriCare for the military, and the BIA health service for Indian reservations. According to some estimates these agencies remove as much 90 percent of the risk from the health insurance pool, including veterans with PTSD who will require lifetime care.

That leaves the healthiest segment to private companies, who still manage to spend as much as 47 percent of the premium dollars they receive in "loading fees," – non-medical expenditures --according to a University of Minnesota study.
What insurance companies do is take your money and promise to pay if you get sick.
They then use your premiums for their own purposes, including showering money and benefits on executives, like "Dollar Bill" McGuire," and on tame board members who rubberstamp management’s decisions. It was reported in the Minneapolis StarTribune in 2006 that ten public members of UnitedHealth’s board each cashed in at least $1 million worth of company stock. So management and the board were busy scratching each other’s back with the assets of a public corporation.
Those premiums provide them resources to hire lobbyists, buy off congressional watchdogs with campaign contributions and underwrite the current $400 million public scare campaign against insurance reform, the better to protect their private piggy banks.
With those resources, insurance executives award themselves stock options, golden parachutes, lifetime use of company jets, chauffeured limousines, company apartments, club memberships, sports tickets, financial planning, and other perks.

Competition from a government option would clearly doom such largesse. Medicare’s overhead is 4% and its administrator makes $250,000. The private insurance industry, in contrast, extracts $450 billion from the system every year...enough to fund Medicare for everyone.

A recent Kaiser Family Foundation study determined that insurance premiums average $13,375 per family (including employer contributions). In addition, according to NPR, the average middle class family pays of "tax" of $1100 dollars to its local hospital to cover emergency room medical care for the indigent. This is the highest cost medical care in the world, and even covers illegal aliens.
Medicare-for-all would eliminate those costs and allow cost-effective medical care at less than the combined $14,475 average that families are already paying, because private insurance companies wouldn’t have their hands in the till.
Despite the current costly, corrupt, and dysfunctional system, some in Congress continue to oppose reform, choosing in effect to protect insurance executives’ perks instead of providing healthcare for all. This is what $400 million, liberally spread around, can do, and further reason the system must be changed.

Who Will Cover the Cost?

2009-10-11T08:27:00.000-07:00

Score the War
by Bruce Webb
Score the War Sat Oct 10, 2009 at 09:40:43 AM PDT
David Obey asked some sensible questions the other day, including this one:

1.As an Appropriator I must ask, what will that policy cost and how will we pay for it? We are now in the middle of a fundamental debate over reforming our healthcare system. The President has indicated that it must cost less than $900 billion over ten years and be fully paid for. The Congressional Budget Office has had four committees twisting themselves into knots in order to fit healthcare reform into that limit. CBO is earnestly measuring the cost of each competing healthcare plan. Shouldn’t it be asked to do the same thing with respect to Afghanistan?If we add 40,000 troops and recognize the need for a sustained 10 year or longer commitment, as the architects of this plan tell us we do, the military costs alone would be over $800 billion. And unlike the demands that are being made of the healthcare alternatives that they be deficit neutral, we’ve heard no such demand with respect to Afghanistan. I would ask how much will this entire effort cost, when you add in civilian costs and costs in Pakistan? And how would that impact the budget?
Some discussion in extended entry.

Bruce Webb's diary :: :: http://en.wikipedia.org/...
In 1932 faced with the need to confront the Depression head on the top marginal tax rate was raised from 25% to 63%. In 1936 it was raised again to 79%, and after the outbreak of war to 88% and finally in 1944 94%. It had to be done, we were faced first with a world wide Depression and then by a World War with existential implications, we could win and preserve democracy in Europe and here in the United States or lose and perhaps lose everything. And by and large Americans understood that, they accepted the concept of shared sacrifice and hesitated not to ask/force the wealthy to share the burden. Well we won that war, only to enter into a new phase called the Cold War, which we paid for while steadily reducing our debt as a share of GDP. Tax rates shrank slowly after 1945 only to pick up to 91% to pay for Korea.

The principle seemed simple, you go to war, you dig as deep in your pockets as necessary to pay for it. And even though Johnson cut the rate to 70% in 1965 this principle was maintained, through the sixties and seventies the nominal total of public debt remained flat while debt as a percentage of GDP steadily dropped.
http://en.wikipedia.org/...

Of course over that whole time Democrats were in control of the White House or the Senate or both. In 1980 we lost both to the Republicans and the principle of paying for military spending and wars went out the window with results to be seen on the linked graphs. And except for a brief period in the 1990s when a combination of the Peace Dividend and a small boost in top rates and a stock bubble allowed us to get back on a debt reduction track we have been on the same course since 1980.

In 2001 we were attacked, and by an enemy while small in number, potentially had world wide reach and was intent on presenting an existential threat to the West. But instead of the Republican controlled White House and Senate asking us, and especially the wealthy to dig deep and pay for these new wars, we got tax cuts for the wealthy and the instructions to "go shopping". And when the hot war was pending in Iraq we were solemnly assured that the war would be quick, painless, and essentially self-financing. Well it wasn't any of those.

In 2007 the strain caused by two ongoing wars was joined by a new economic crisis which seemed to rival the threat of that of 1932. But the Republicans once again refused to step up and pay for anything. Well they are gone and it is time for some honest, and I might add patriotic. discussion of how we are going to pay for a new phase of the War in Afghanistan.

Whatever your feelings about the immediate escalation Obama ordered last March, it is arguable that without those troops Afghanistan couldn't even hold an election. But it got done and the result was clear, the current regime, marked by corruption on a massive scale, was also not even committed to democracy. Moreover it became clear that this surge in Spring/Summer 2009 was not enough to 'win' the war. Which left us with a new starting point.

We are where we are, and there are plenty of diaries to discuss the war, my question is more focused. Don't those who are pushing for more war have the obligation to answer Obey's first question quoted above and then the five that follow it? Chief House Appropriator Urges Obama to Change Course on Afghanistan. Gen McChrystal has laid out a specific plan for an extended COIN operation in Afghanistan along with substantial reconstruction efforts. When Congress was faced with financial collapse we had some fixed figures to work with $750 billion for TARP and then $761 billion for the stimulus. When Congress was faced with addressing the long term crisis in Health Care not only did we demand fixed numbers for all plans, but ways to pay for them in deficit neutral ways. Which leaves my question.

Why do not supporters of the extension and broadening of the war effort have at least a minimum duty to Score the War? I am not even asking that they find a way to pay for it, though that would be the patriotic thing to do and what we did with every war prior to Reagan. I just want to have an honest bottom line for discussion.

Score the War. It is not a lot to ask.

Our America

2009-08-05T08:48:00.000-07:00

Comments by “Bill from Portland”. (DailyKos 08/05/09)
> We're still addicted to oil.
> We still have a draconian health insurance system.
> We put a gun to our economy's head and pulled the trigger.
> We drained the Treasury and essentially sold the joint to Asia.
> We're creepily obsessed with war and things that kill, and our military spending is beyond obscene.
> The rich have gotten richer while the poor and middle class have gotten screwed.
> We're still "debating" what to do about global warming (or is it global "cooling"???)
> We sneer at other countries as if it's obvious that God made us superior to them in every way.
> We're workaholics and always in a hurry.
> We're dumbing ourselves down to the point where half of us can't find New York on a map.
> We believe that whoever dies with the most toys wins.
> Booze and tobacco, which kill countless people, are legal. Marijuana, which kills virtually no one, is not, and violators are often severely punished. Oh...and we throw a higher percent of our citizens in jail than any other country.
> What citizens want from the government is secondary to what corporations want.
> Our media is so afraid to offend anyone that they go out of their way to give both sides of an issue equal weight, even if one of those sides is either factually incorrect or batshit crazy...thus slowing down our progress as a country even more.
> Our food supply is so bad that we should probably be putting "Mr. Yuk" stickers on half of the stuff sold in supermarkets and 7-11s.
> For all of our bad-assity---all our guns and nukes and soldiers and cops and black helicopters and warrantless surveillance and militias and tough talk and the fact that our private citizenry is armed to the teeth with every type of firepower imaginable, we sure scare easily. Half the stuff over which we tremble is a figment of our own overactive imaginations. But one thing is as real as it is backwards: we fear our government, but our government does not fear us.

They tell us we can trust the Insurance companies?

2009-07-28T13:42:00.000-07:00

July 28 (Bloomberg) -- The last time a president tried to overhaul U.S. health care, Americans were spending $912 billion on the system and 40 million were uninsured. Today they’re spending $2.5 trillion and almost 50 million lack coverage....

Health-insurance premiums for families have risen 119 percent since 1999, according to the Kaiser Family Foundation, a Menlo Park, California-based policy-research firm. Inflation has risen 28.5 percent over that period, according to the Labor Department.

Premium costs are projected to rise another 9 percent next year, an increase that 42 percent of employers plan to pass on to their workers, according to a report last month by PricewaterhouseCoopers. That’s likely to further squeeze millions of Americans who find themselves in high-deductible insurance plans as wages stagnate because of the recession....

Health-care spending will account for 20 percent of U.S. gross domestic product in 2018, or $1 in $5 spent, compared with 16 percent of GDP, $1 of $6 spent, in 2008.

Population Clocks

2009-05-15T08:58:00.000-07:00

Population Clocks

U.S. National Debt Clock

2009-05-14T09:40:00.000-07:00

U.S. National Debt Clock

Lobbyist continue to resist the change we need!

2009-05-13T09:18:00.000-07:00

Kate Sheppard over at Grist reports:

Dirty energy interests have spent $79 million this year lobbying Congress
According to the latest lobbying data compiled by the Center for Responsive Politics, the oil and gas industry spent nearly $44.6 million lobbying Congress in just the first three months of this year, and ranked second only to the health care and pharmaceutical industries in total spending. Electric utilities spent $34.4 million, and businesses in the energy and natural resources sector as a whole spent $102.7 million.
To find out how much clean-energy businesses spent, you have to search down into the "miscellaneous energy" category, which includes wind, solar, biofuels, hydro, and other industries—and even then their combined spending only totaled $14.4 million. The American Wind Energy Association was the biggest renewable spender in that category, at $1.2 million. No other organization or company in the category topped $1 million.
Environmental groups have spent even less—just $4.7 million so far in 2009. The biggest spender among green groups was the Environmental Defense Action Fund, which laid out $300,000.
Meanwhile, the U.S. Chamber of Commerce, a staunch opponent of climate action, tops the list of individual spenders on all issues, at $15.5 million. Also on that list: ExxonMobil at $9.3 million, Chevron at $6.8 million, ConocoPhillips at $6 million, and General Electric at $4.8 million.
Of course, it would be wrong to assume that all of these big-energy spenders are lobbying against a climate bill. ConocoPhillips and GE, for example, are both members of the U.S. Climate Action Partnership, and ConocoPhillips’ senior vice president testified in support of the House climate and energy bill last month. But it does give you a sense of just how much renewable-energy groups and enviros are being outspent on the Hill.

Copied from Dailykos.com

2009-05-08T09:12:00.000-07:00

Will You Soon Be 'Naturally' Unemployed?
by Meteor Blades
Thu May 07, 2009 at 07:32:05 PM PDT
Indications are that when the Bureau of Labor Statistics releases its unemployment figures Friday the news may be slightly less grim than it has been for the past several months. The most optimistic prediction in a Reuters survey of 70 economists is that perhaps only 530,000 layoffs occurred in April, which would lift the official unemployment rate to 8.7%.
Compared with the 663,000 jobs lost in March, and similarly high numbers for the past several months, this would be good news. Unless, of course, you are one of those hundreds of thousands of new layoffs. But the more likely figure for last month will come in somewhere just above 600,000. This would take us from an 8.5% to an 8.9% official unemployment rate, the worst in 26 years. Whatever the official rate turns out to be, however, an alternative BLS gauge of unemployment will surely clock in at 16% or more. That gauge includes Americans who have become so discouraged at finding a job they’ve given up and those who work part time only because they can’t find a full-time job.
While many economists and other observers seem to be sniffing the bottom of the trough of what has just became the longest running downturn since the Great Depression, probable long-term effects of this crash won’t smell sweet.
As Matthew Benjamin and Rich Miller of Bloomsberg wrote Monday:
Post-recession America may be saddled with high unemployment even after good times finally return.
Hundreds of thousands of jobs have vanished forever in industries such as auto manufacturing and financial services. Millions of people who were fired or laid off will find it harder to get hired again and for years may have to accept lower earnings than they enjoyed before the slump.
This restructuring -- in what former Federal Reserve Chairman Paul Volcker calls "the Great Recession" -- is causing some economists to reconsider what might be the "natural" rate of unemployment: a level that neither accelerates nor decelerates inflation. This state of equilibrium is often described as "full" employment.
Fallout from the recession implies a "markedly higher" natural rate of unemployment, says Edmund Phelps, a professor at Columbia University in New York and winner of the 2006 Nobel Prize in economics. "It was 5.5 percent; maybe it will be 6.5 percent, maybe 7 percent." ...
People who lost stable work in the early 1980s sustained large and long-lasting earnings reductions, according to research by economists Till von Wachter of Columbia University, Jae Song of the Social Security Administration and Joyce Manchester of the Congressional Budget Office. A typical 40- year-old man who became unemployed at the time went on to suffer a 20 percent loss in lifetime earnings, they found. ...
"People losing their jobs now in permanently downsizing industries have to be aware that they’re particularly at risk of pretty large losses" to lifetime wages, says von Wachter, who briefed staff at the Fed and the European Central Bank last month on the effects of mass layoffs.
"People tend to think that when you come out of a recession you get the labor market you had when you entered it," says Lawrence Mishel, president of the Economic Policy Institute in Washington. "This time you may get something quite different."
Unless you're in the top 20%, and even if you are, you probably are acquainted with some people in this predicament. You may be one.
There was a time, starting with the New Deal, when full employment was considered a moral imperative. Some legislation even included the words: the Humphrey-Hawkins Full Employment and Balanced Growth Act of 1978, for instance. But, World War II aside, when we were beyond full employment, we’ve only approached something that could reasonably wear that label during the 1960s, with assistance from the wars in Southeast Asia, and in the late 1990s, during the dot.com bubble.The "natural rate of unemployment" (NAIRU) was invented by economist Milton Friedman. That concept - along with his consequent laissez faire prescriptions for deregulation, taxation, and monetarism over fiscal policy as the prime government mover of the economy - became conventional wisdom with the ascendancy of Margaret Thatcher and Ronald Reagan.
Previously, a balance had been sought between stabilizing employment and prices. But beginning with the Thatcherite/Reaganite shift, as Thomas Palley, director of the Economics for Democratic & Open Societies Project, wrote in 2007, "rising wages are actually viewed as cause for concern on the grounds that they may be inflationary, but the same standard is never applied to rising profit rates."
Lost in the upward transfer of wealth that these policies generated was the New Deal-Great Society approach that favored full employment. Inflation is the key enemy, claimed the Friedmanites and their allies, and full employment – that is, anything above the natural rate of unemployment – is bad because it drives inflation. So when folks start talking about a natural rate of 6% or higher, you know what they’ve got in mind.The effects of the Thatcherite/Reaganite policies have been widely tallied.
Wages have been delinked from productivity growth, putting the gains from this growth into the hands of the well-heeled and worsening income inequality. From 1959 to 1979, wages were tied to productivity, but in the past 30 years, with brief exceptions, productivity has grown while hourly pay has stagnated. Indeed, males in the bottom quintile have seen their real wages fall. Measured by family income, the productivity growth "dividend" has wound up almost exclusively in the hands of the top 20%.
Unfettered globalization has off-shored tens of millions jobs, reducing U.S. manufacturing, the original source of the American middle class and of post-1945 prosperity, and contributed to union busting, which has reduced workers’ already reduced ability to bargain for a fair share of the benefits of productivity growth.
As a consequence of this and other bad labor trends, the typical American worker outside that top 20% is more likely to be, as Palley wrote, at more risk "of job loss, permanent wage reductions, reduced length of job tenure, reduced health care coverage or increasing health care costs, and greater retirement income security risk owing to the shift away from defined-benefit pension plans to defined-contribution plans."According to the "natural rate" theory, the Federal Reserve can do nothing about any of this, and it shouldn’t try. No stimulative Keynesian methods should be tried either because they raise inflation.
Palley again:
Indeed, the situation is even worse because of the Fed’s asymmetric approach to nominal wages. When wages lag prices, the Fed sits on its hands, albeit with expressions of sympathy for workers. However, when wages outrun prices, the Fed stands ready to raise interest rates on the grounds that rising unit labor costs are inflationary.
... the theory of the natural rate contributes to driving the so-called "labor market flexibility" agenda that attacks unions, the minimum wage, and employment and worker protections. The logic is that these institutions prevent wages from adjusting downward, and thereby increasing the natural rate of unemployment.
Twisted, eh? Unless, of course, you’re an oligarch or otherwise ensconced in the top 20%.
Many progressives view full employment as mostly a matter of short-term fiscal stimulus. But reworking interest rates, trade deficits, budgetary policy, globalization, taxation and currency exchange rates must also be a component of any policy of sustained full employment in the 21st Century, as Palley lays out in considerable detail.
That daunting list of needed changes points to a full-blown overhaul of U.S. economic policy. In every society in every era, that is the hardest thing to do. It touches on people's deepest beliefs but most of all on their self-interests. Faced with even modest reform, those with clout will erect well-funded obstacles to the reformers. The situation is made all the more difficult right now because many of those Democrats who might otherwise be predisposed to making changes are held back by their acceptance of the accumulated myths associated with existing economic policy.
Short of making the most difficult economic changes, however, there is the matter that even blue-dog Democrats ought to be able to handle without flinching: establishing the government as employer of last resort. FDR put together programs to do that. They weren't enough, but they pointed in the right direction. L. Randall Wray at The Levy Economics Institute writes that:
... no capitalist society has ever managed to operate at anything approaching true, full, employment on a consistent basis. Further, the burden of joblessness is borne unequally, always concentrated among groups that already face other disadvantages: racial and ethnic minorities, immigrants, younger and older individuals, women, people with disabilities, and those with lower educational attainment. Since markets do not operate to achieve full employment, and because markets tend to leave behind the least advantaged members of society, government should and must play a role in providing jobs to achieve social justice. Proponents of a universal job guarantee program operated by the federal government argue that no other means exists to ensure that everyone who wants to work will be able to obtain a job.
There is no natural rate of unemployment. But there is a natural – that is, fundamental – right to work. The social and economic costs of unemployment – lost income, crime, broken families, physical and mental health problems, interrupted educations, shattered retirements, social unrest – ought to be plenty to make providing full employment a slam dunk for politicians supposedly in tune with their constituents. It shouldn’t take an economic catastrophe to press this point home. But since we’re afflicted with one now, it would be encouraging to see more Democrats take Rahm Emanuel’s words to heart: Never let a serious crisis go to waste.
http://www.dailykos.com/story/2009/5/7/729001/

E-mail to Senator Ben Nelson

2009-05-05T14:58:00.000-07:00

Below is a copy of an e-mail that I have sent to Senator Nelson. Help me out with this. I'm asking all of my progressive friends that I can think of to copy the text of this communication, sign it and forward to Ben Nelson, then forward this e-mail to all progressives in you address book. If every true Progressive in the State will do this maybe, just maybe we can get his attention. Give me your thoughts on this. Thanks.

e-mail:
pconsneb@yahoo.com

E-mail form address for Senator Nelson below.
http://bennelson.senate.gov/contact/email.cfm

Senator Ben Nelson
This communication is to protest your conservative voting record and failure to support President Obama's legislative agenda. Progressivepatriots.com awarded you a Progressive Action score of 6 which means you voted to support a slate of progressive actions only 6% of the time during the 110th Congress. You also had a right-wing index score of 75. A score of 75 means that you acted to support a slate of conservative wrongheaded policies in the 110th Congress 75% of the time. You ran for your office of Senator as a Progressive Democrat. You have and are failing to support the progressive causes that the voters that elected you desire. I sincerely request, actually demand that you change your stance of supporting the oligarchy which financed your campaign and start supporting the needs and desires of the grass roots Progressive Democrats of Nebraska and the rest of the Country. The overwhelming 2008 election results which totally discredited the failed policies of the Conservative Republicans should convince you that the voters are fed up with the politics of the past. If you hope for any future support from me or thousands of others like me you will start supporting the progressive agenda.
Yours truly,

Wayne Power
2041 Morningside Road #107
Fremont, NE 68025

For those needing help.
Instructions for copying text:
Place mouse pointer to left of Senator Nelson. Hold down left mouse key. Move mouse pointer to right of text. Pull mouse down to last word of e-mail text. Release mouse. Press Control and C. Click on address for Senator Nelson. Fill out form. Place mouse pointer at start of message box. Press Control and V. Sign message and send.

#

Ben Nelson is not a Progressive

2009-05-04T15:20:00.000-07:00

To say that I am extremely disappointed in Sen. Ben Nelson's voting record as a representative of the Progressive Democratic Party is to put it very mildly. In fact I personally feel that in all fairness to the party that he needs change is position to support progressive values or to resign and switch parties. After all his voting record is at least 75% with the Republican right wing. Senator Nelson was awarded a Progressive Action Score of 6 by progressive patriots.com. A score of 6 means that Senator Nelson has acted to support 6% of a slate of progressive policies in the 110th Congress. He also has a right-wing index score of 75. A score of 75% means that Senator Nelson acted to support a slate of conservative wrongheaded policies in the 110th Congress.

For the 109th Congress Sen. Ben Nelson was awarded a Progressive Action Score of 0. A score of 0% means that Sen. Nelson acted to support 0% of a slate of progressive policies in the 109th Congress. He was also awarded a regressive conservative score of 91. A score of 91 means that Senator Nelson has acted to support 91% of a slate of conservative, wrongheaded policies in the 109th Congress.

Our Country is at the most critical juncture of its future that I have observed during my lifetime. I was 7 years old when Franklin D. Roosevelt took office and I know full well what conditions were like at that time. They were dire but did not compare with the conditions that President Barrack Obama has inherited. President Obama was elected by a wide majority and the progressive voters of the nation soundly rejected the failed policies of the Republican Party.

Senator Nelson continues to support many of those failed policies. The Banking Lobby, the Insurance Lobby, and Energy Lobby still owns him. Banking regulations, Health Insurance for all, and a big push for renewable energy, and Education reform are a vital part of the Presidents plans for economic recovery. Senator Nelson seems to be opposed to vital parts of the Presidents legislation for each of the above. He either needs to change his position and start voting as a true Progressive or switch parties. We in the Democratic Party need to be represented by a true Progressive not a pretender.

Am I the only Progressive that feels that way or will others join with me in protesting Senator Nelsons wrongheaded right-wing voting?

2009-05-02T09:41:00.000-07:00

H1N1,"Swine flu", just another reason for abolishing currency and coin as the medium of exchange. Those one's, five's, ten's, twenty's that you carry around in your pocket, billfold, or purse or hide under you mattress are a primary source of bacterial and virus transmital. Use your plactic. Wash and sanitize your hands.

More on Taxes

2009-04-21T11:26:00.000-07:00

This is April 21, 2009, six days after the closing date for filing 2008 State and Federal Income Tax Returns. Can you tell me within the nearest $100.00 how much you paid for Federal and State Income Tax? Now I want you to multiply your taxable income up to a limit of $102,000.00 by 15.3% then add the Federal Income tax that you paid for 2008. That amount divided by your taxable income for 2008 will provide you with the known percent of Federal Tax paid for the year 2008. I use the 15.3% rate for calculating the FICA and Medicare tax in as much as it includes the employer co-pay of 7.65% which is actually part of your salary. Now for those fortunate enough to earn more than $102,000.00 per year your 15.3% FICA and Medicare tax will drop to 2.9% on all earnings over the $102,000.00 limit. For those earning above the limit their Federal Income tax rate will increase but not nearly as much as the FICA tax rate decrease so as earnings increase the total tax rate paid decreases.
The amount that you have calculated above is only the beginning of the taxes that you paid for the year.
You need to add to this amount your State Income tax paid, your property tax whether you own or rent you are paying property tax, your vehicle taxes and fees, your sales taxes paid, the gasoline and diesel taxes paid, taxes and fees paid for phone service, excise taxes, if you smoke or use alcoholic beverage add those taxes, and the list goes on and on.
Now when you spend the money that is left you must realize that you are unknowingly paying all of the accumulated taxes on whatever goods or services that you are paying for. Consumers pay ALL taxes. The point that I am trying to drive home here is that none of us know or even begin to understand how much our total tax bill is. Yet no matter how much we are paying in Federal Taxes it has not been enough, witness the 11Trillion plus Federal Debt that our elected representatives have allowed to occur while all of the time pandering us with the promise of lower taxes and less spending. Less spending has never occurred and with a constantly growing population is not likely to occur. Our self-serving elected representatives have delivered lower Federal Taxes by failing to pay the cost of Government. The other point that I am trying to make here is that much of the taxes we pay are hidden from us and that we are unaware we are paying them. When taxes are hidden from us we are unlikely to pay much attention to what government is really doing. It is easy to blame the self-serving politician for the mess that we are in yet in reality you and I are to blame. We have stood by and let it happen. The electorate can change it but will they?
Join in the dialog. Post your comments below. Bloggers blog in hopes of starting a dilalog.

A Short Citizen's Guide to Kooks, Demagogues, and Right-Wingers On Tax Day

2009-04-17T09:50:00.000-07:00

Robert Reich's Blog

April 15, 2009, 11:36AM

No one likes to pay taxes, so tax day typically attracts a range of right-wing Republicans, kooks, and demagogues, all of whom tell us how awful we have it. Herewith a short citizen's guide (that is, a citizen's guide that's short rather than a guide for short citizens) responding to the predictable charges:

1. "Americans pay too much in taxes." Wrong: The United States has the lowest taxes of all developed nations.

2. "The rich pay too much! The top ten percent of income earners pay over 72 percent of all income taxes!" Misleading: The main reason the rich pay such a large percent is they've become so much richer than the bottom 90 percent in recent years. If you look at what they pay as individuals -- the percent of their incomes over and above the highest rate below them -- you'll see a steady decline over the years. When Republican Dwight Eisenhower was president, the marginal rate on the highest earners was 91 percent (after deductions and tax credits, closer to 50 percent); by 1980 it was still up there, at 70 percent (an effective rate of closer to 45 percent); under Bill Clinton, it was 38 percent (an effective rate closer to 28 percent).

Look at the after-tax earnings of families and you'll see what's really going on. Between 1980 and 2000, the after-tax earnings of famlies at the top rose more than 150 percent, while the after-tax earnings of families in the middle rose about 10 percent. The Bush tax cuts of 2001 and 2003 raised the after-tax incomes of most Americans by a bit over 1 percent -- but raised the after-tax incomes of millionaires by 4.4 percent.

3. "The bottom 60 percent pay only 3.3 percent of the taxes!" Misleading again. Most Americans are paying more in sales taxes than they ever have. Property taxes have also been rising at a steady clip. And Social Security taxes have also risen (thanks to the Greenspan Commission), while earnings over about $100,000 aren't subject to Social Security taxes. So-called "sin" taxes (mostly beer and cigarettes) have also skyrocketed. All of these taxes take a bigger bite out of the paychecks of people with lower incomes than they do people with higher incomes.

4. "Obama is raising your taxes!" Wrong. Obama is cutting taxes for 95 percent of Americans, by about $400 per person a year -- not a whopping tax cut, to be sure, but not a tax increase by any stretch. Only the top 2 percent will have a tax increase, but even this tax increase is modest. Basically, they go back to the rates they were paying under Bill Clinton (their deductions will be limited to 28 percent, which is only fair). And they won't start paying this until 2011 anyway.

5. "The huge debts we're wracking up will cause your taxes to rise!" Wrong again. When it comes to the national debt, as I've said before, the relevant statistic is the ratio of debt to the gross domestic product. The only sure way to bring that debt down and make it manageable in future years is to get the economy growing again -- which requires that, in the short term, the government spend a lot of money (because consumers and businesses won't). In the long term, the biggest source of concern is rising health-care costs. And that's something Obama and Congress are aiming to tackle.

6. "We have a patriotic duty to stand up against Washington taxes!" Just the opposite. We have a patriotic duty to pay taxes. As multi-billionaire Warrent Buffett put it, "If you stick me down in the middle of Bangladesh or Peru or someplace, you'll find out how much this talent is going to product in the wrong kind of soil. I will be struggling thirty years later." President Teddy Roosevelt made the case in 1906 when he argued in favor of continuing the inheritance tax. "The man of great wealth owes a particular obligation to the state because he derives special advantages from the mere existence of government."

An acquaintance from law school, now a partner in one of Washington's biggest and wealthiest law firms, explained to me one day over lunch how he and his partners use tax rules to create offsetting taxable gains and losses, and then allocate the gains to the firm's foreign partners who don't pay taxes in the United States. That way, they keep the losses here and shelter their income abroad. I noticed he had an American flag lapel pin. "You're supporting our troops," I said, referring to his pin. "Yup," he replied, entirely missing my point.

True patriotism isn't cheap. It's about taking on a fair share of the burden of keeping America going.
Article reprinted from

Talking Points Memo

Mindless Tea-Bagging

2009-04-14T10:46:00.000-07:00

Mindless followers of Rush Lindbaugh, Sean Hannity, Glen Beck, and now Newt Ginrich will be tea-bagging their tax protest tomorrow April 15th. The irony of the protest is that the tax they are protesting is the tax policy of the George W. Bush administration which they elected and kept in power for two terms. The same administration which was handed a large tax surplus by the Clinton Administration and that surplus was being used to pay down the national debt which the Clinton Administration inherited from the Reagen-H.W. Bush Administrations. Ninety-five percent of those protesting will be the recipients of a tax cut from the Obama Administration which is who they are protesting. The tea-bagging event will be simply an exercise in futility and flawed reasoning. The net result will be a temporary increase in the sale of teabags, additional unnecessary pollution of our lakes, streams, and rivers.
In a recent poll 56% of those polled agreed that Federal income taxes are too high. That means that the majority of those polled failed to give much thought to their answers. The Federal government has been operating with huge unsustainable budgets for the last 28 years. The U.S. National debt stands at $11,184.309223.818.82 as of today and is growing at the rate of 386 billion dollars per day. This debt has occurred for one reason, pandering politicians who understood that they could promise lower taxes and spending cuts while all of the time just go ahead and spend and spend and charge the actual cost of Government to our children, grandchildren, great-grandchildren, etc. Will we ever hear an honest politician that will tell us that Government must be paid for?

Unemployment Soars to 25-Year High

2009-04-03T09:15:00.000-07:00

The Bureau of Labor Statistics this morning reported another large rise in unemployment. The official unemployment rate now sits at 8.5%, up from 8.1% last month and higher than at any time since November 1983. Job losses for March totaled 663,000. Since December 2007, when the recession began, 5.1 million jobs have been lost, with 3.3 million of those occurring in the last five months.

"Among the unemployed, the number of job losers and persons who completed temporary jobs increased by 547,000 to 8.2 million in March. This group has nearly doubled in size over the past 12 months," the BLS reported.

Bad as the numbers are, the misery is worse than they show. The official unemployment rate (called U3 by the BLS) doesn’t count people who are so discouraged they have given up looking for work nor those who have taken a part-time job only because they can’t find full-time employment. The figure that includes these Americans (U6) hit 15.6% today, up from 14.8% last month.

In the 1930s, part-time workers – like many of those employed by the New Deal’s Civilian Conservation Corps and Works Progress Administration – were not counted in unemployment statistics. So the figures for unemployment in that era – which hit a peak of nearly 25% but averaged 14.8% from 1930-1939 – are more closely paralleled by U6 than U3.

2009-04-01T14:14:00.000-07:00

Federal Bureau of Investigation Seattle Press Release

2008 BANK ROBBERY STATISTICS RELEASED ... Nationally, in 2008, there were approximately 6,000* bank violations, with a total loss approaching $60,000,000*. Washington ranked 14 in total number of bank robberies by state. ...Quick solution--eliminate currency and coin. No cash. No robbery!

Common Sense Solution

2009-03-29T10:04:00.000-07:00

Before you read this post I suggest that you read or re-read my post on March 23rd titled “Money, Currency & Coin, Cash. This post is a follow up solution to the problems I attributed to the use of Currency and Coin as our medium of exchange.
Congress should eliminate Currency & Coin as the medium of exchange. Congress should set a date certain for all existing U.S. Currency & Coin to be converted to Dollar and Cents based U.S. Bank credits. There-after the medium of exchange would be by check, debit card, credit card, and electronic funds transfer. I realize that this would force every one to have a Bank account which a few people still resist. Some people still cling to their cash and distrust the Banks and the government. We have the technology available to easily convert from cash to Bank credits.
The benefits of Bank credits would be immense immediately. Bank robberies would cease. Reported income would drastically increase. The illegal drug economy would suffer extreme stress as it is a cash based activity. The drug cartels are extremely innovative and could probably find a way to survive, but at least the financial transactions would be traceable. Crime should be drastically reduced. Cash is the motive of most crime. Remove the motive eliminate the crime. The cost of printing and coining currency and coin would be eliminated. The cost of guarding and transporting currency and coin would be eliminated. Banking and business costs would be reduced. Banks and businesses spend a considerable amount of time and money counting currency and coin over and over again and again. What a waste of time.
Your comments appreciated.

2009-03-25T09:49:00.000-07:00

The White House is throwing open its virtual doors and inviting the public to submit questions about the economy online to US President Barack Obama.
Obama on Thursday is to go online himself to answer some of the questions asked through the White House website at:
http://www.whitehouse.gov/
OpenForQuestions

The White House unveiled the new feature, "Open for Questions," on Tuesday and had received 15,000 questions as of Wednesday from more than 12,600 people.
Registered users were able to vote on the questions they preferred and more than 460,000 votes had been cast as of Wednesday in an experiment the White House is calling a "community-moderated online town hall."
In a video at whitehouse.gov, Obama said "one of my priorities as president is opening the White House to the American people so folks can understand what we're up to and have a chance to participate themselves.
"We're going to try something a little different," he said. "We're going to take advantage of the Internet to bring all of you to the White House to talk about the economy.
"This is an experiment but it's also an exciting opportunity for me to look at a computer and get a snapshot of what Americans across the country care about," Obama continued.
"We may not always agree on everything but this way I can get a sense of your concerns and give you some straight answers."

MoneyCurrency & CoinCash

2009-03-23T10:49:00.000-07:00

Money makes the world go around. Money is the root of all evil. Money is a necessary evil. All of the above bear some truth. The Constitution of the United States granted Congress the authority to coin money and to regulate the value thereof. Money is the medium of exchange for goods and services that we all use. In the U.S. we have a cash economy in which the value of money is expressed in dollars and cents. We use currency and coin to facilitate payment. Our currency is actually fiat money. Fiat money or fiat currency (usually paper money) is a type of currency whose only value is that a government made a fiat (i.e. decreed) that the money is a legal method of exchange. Unlike commodity money or representative money it is not based in another commodity such as gold or silver and is not covered by a special reserve. Fiat money holds its value so long as holders of the currency feel that they can find an exchange partner for it at some later time. Fiat money, by definition, does not have any intrinsic value, nor is it backed by anything other than the confidence holders have in the economy which is covered by the government which decrees it to have value. Its value lies solely in the expectation of later use.
We consider currency and coin as cash. Cash has many drawbacks to its use. It can be and is counterfeited. Counterfeiting dilutes the value of all existing cash. It can be lost, stolen, and destroyed by fire and other means. It is expensive to mint. It is expensive for business and banks to handle and account for. It spreads disease. It has often been said that money is the root of all evil. We do know that cash is the motive for most crime committed in the U.S. Cash is the lifeblood of the illegal drug trade, the chop shops where you’re stolen car is stripped of its parts and sold. Cash is the sole motive for robberies, holdups, muggings, and shoplifting. In the U.S. we have two economies, the cash economy and the taxable economy. It is estimated by many that the cash economy is as large if not larger than the taxable economy. We have people in this Country that survive entirely upon unreported cash transactions and others who simply skim a part of their cash receipts to avoid taxation. The illegal drug trade is a huge business and the government does not directly tax any of the receipts. Cash transactions can't be traced. Cash facilitates crime. As a result those of us who work for taxable income pay twice as much in taxes as we should. All things considered the use of currency and coin to facilitate trade should be seriously reconsidered.
Many of us rarely use currency or coin to pay bills. I personally use a credit card for everything possible and I pay it in full every month. I pay most monthly bills on line with my bank's bill pay procedure and I write checks when that is the only other alternative. I try never to use currency and coin. When I spend cash I never known where it went to. It is time to eliminate cash transactions.

Taxes-taxes-taxes & taxes

2009-03-20T11:36:00.000-07:00

Governments levy taxes upon their citizens to pay the cost of government. Let me rephrase that. Governments levy taxes upon their citizens that are supposed to pay for the cost of government. Politicians love to pander their constituents promising lower taxes and less government which in actual practice has resulted only in little to no regulation of business and a failure to pay the cost of government. They have simply been charging a large portion of the cost of government to our children, grandchildren, great-grandchildren, great-great-grandchildren, ad nausea, resulting in the current 11 trillion dollar federal debt. Government levies taxes from every level of government, local, township, county, state, and federal. For this comment I will limit the discussion to Federal taxes.
Our Federal tax code is an abomination. It is unfair. unjust and it is cost inefficient. The Federal tax code is massive and difficult for the average person to understand. The Federal tax law is administered primarily by the Internal Revenue Service, a bureau of the Treasury. The U.S. tax code is known as the Internal Revenue Code of 1986 (title 26 of the United States Code). The Code's complexity generally arises from two factors: the use of the tax code for purposes other than raising revenue, and the feedback process of amending the code.
While the main intent of the law is to provide revenue for the federal government, the tax code is frequently used for public policy reasons i.e., to achieve social, economic, and political goals. For example, to encourage home ownership, the tax law provides a deduction for mortgage interest expense on debt secured by primary residences. In addition, the law does not allow a deduction for renters for rent paid to offset the advantage of nonrecognition of exclusion of imputed owner occupied rent. An income tax system that favors neither renting nor owning homes would not allow the mortgage interest deduction and would tax the imputed rent for owners who live in their own homes.
The federal tax that most of us are most familiar with is the federal income tax and social security and Medicare tax. The federal government also levies many other taxes such as gasoline tax, tobacco and alcohol tax, corporate tax, and excise tax plus many others.
Most of the federal taxes we pay are hidden from us whether by plan or by accident. Payroll taxes are deducted from our paychecks before we receive them. Most workers pay little or no attention to the payroll tax deduction as they have no control over it. Over the years I have made a point of asking people that I have dealt with, “How much income tax did you pay last year?” Few if any could ever tell me. Most knew the amount of their last refund. Many of the other taxes we pay are not even quoted to us. When we gas up our cars we are paying 18.4 cents per gal federal gasoline tax, if you are a smoker effective April 1, 2009 you will pay $1.01 per pack in federal taxes, currently 39 cents, these taxes are not quoted to you. Federal taxes are collected by, accounted for, reported by, and remitted by millions of unpaid tax collectors, employers and businesses.
Entire industries exist because of the federal tax code. The tax code must be reprinted by the IRS each and every year. Millions of tax forms must be reprinted every year. Tax preparation firms , tax accountants, and tax attorneys exist solely due to the federal tax code. Businesses must compute and deduct the payroll taxes from employees pay. Large businesses must maintain large payroll departments to handle the accounting and remittance of the payroll tax. Billions of dollars of deducted payroll taxes have been collected by employers and never remitted to the IRS. I would be curios to know what the total cost of operating the Internal Revenue service plus the total cost of tax accounting, collection, and remittance would amount to compared to the total collected. All of this cost is ultimately born by the taxpayers, you and me, the consumers.
Consumers pay all taxes. It is impossible to tax business or corporations. Any business that plans to continue it's existence includes all taxes imposed upon it in its operating cost and the tax is passed on to the customer, you and I. We just don't realize that we are paying it. When we go to any store or receive any service the price we pay includes the total accumulated taxes incurred in the delivery of the goods or service received.
I could ramble on and on but to keep it simple I will just say again that our existing tax codes are unfair unjust and should be completely abolished and a simple, fair, and clearly stated tax code should be adopted, and government should be required to operate on a balanced budget. My grandchildren are tired of their parents and grandparents allowing the politicians to charge the cost of government to them. You and I are to blame. We let this happen. We can change it. Will we?

Keith Olberman's Special Comment On Corporate Greed

2009-03-20T09:27:00.000-07:00

Take a few minutes out of your day and watch this video.

Visit msnbc.com for Breaking News, World News, and News about the Economy

To anonymous

2009-03-14T11:37:00.000-07:00

Thanks to Anonymous for commenting on my posting of the article titled Debt, Oil, Killing, and Drugs on March 5th, 2009. This article was written by and posted on his own site and dual posted on the “dailykos.com” by the national gadfly. I copied and pasted it because I felt that it deserved consideration and felt that it was controversial enough to possibly generate a comment or two which it did. Anonymous responded in defense of her faith and did so in a sincere and respectful way. I checked out the comments on national gadfly's site and found the following comment agreeing with Anonymous.

Mitch http://themacpenguin.tumblr.com/

on Mar 4th, 2009 at 10:36
"I agree wholeheartedly with everything except organized religion. While many “religions” do take advantages of their followers, not all fundamentalist religions do. Christianity in of itself, when followed strictly by the New Testament (Christians are not under the authority of the Old Testament), produces a faith that requires its followers to be knowledgeable, giving, treat all people equality (including women), etc. Also, all monies that are collected are to be used for good, helping homeless, feeding the hungry, helping other Christians in need, etc. In fact, God tells us in His word to call people like you describe out, separate ourselves from them and warn others of what they’re doing. So once again, while there are many, in fact I’ll say most, fundamentalist religions that do take advantage of its followers, it is a mistake to generalize it to all religions."
End of quote.

I have been greatly concerned about each of the primary topics of Debt, Oil, Killings, and Drugs. I along with more and more people agree wholeheartedly with the author on his take on these subjects. The current financial situation in our country has been caused by each of the above. President Dwight D. Eisenhower in his farewell address warned us of the danger in allowing the Military/Industrial Complex to much influence in government and we failed to heed his warning.
The question now is how to we change course?

A postscript to Anonymous. Your smiles and hugs accepted and gladly returned and sealed with Love.

2009-03-09T09:48:00.000-07:00

DEBT, OIL, KILLING, & DRUGS

2009-03-05T09:36:00.000-08:00

Copied from the dailykos.com March 5, 2009

Recovery Begins With Truth
by the national gadfly
Wed Mar 04, 2009 at 12:04:05 AM PST

Our country is in need of recovery. We must face the consequences of our actions. I hear people talking about jobs and investment in the country. Yes, I want all of those things. I want them so much, I believe that in order to achieve them, we must look at our misdeeds as a nation. We must make an honest accounting of our addictions.
Debt - This is arguably our most dangerous problem. We spend tomorrow's money today and enter a future of indentured servitude. That borrowed money? Where does it go? It does not go into things for the future like roads, power, food or transportation. It goes into the pockets of the very wealthy manipulators of wealth and finance. Entire populations fooled into spending money that they do not have to make a few people very rich. The false prosperity of one bubble after another distracts us from realizing that we are being bribed to participate in our own future misery.
Oil - The obscene amounts of money that resource rapists like oil, coal, gold & mineral mining industries have at their disposal is irresistible. We are programmed to drive huge cars that we believe make us into 'real Americans' or 'successful' or 'cool looking'. When all we're really doing is polluting the air & water, siphoning off our wealth into the pockets of oil & mineral companies and waiting until it's too late to save cities, towns and states from poverty.
Killing - The USA has been taken over by the military. US Defense Dept. spending dwarfs that of every other country in the world - combined. We bomb, shoot, attack any country we want (usually one that a US oil or mining company is busy stealing from). When that is not enough, they are spying on US Citizens, arming mercenaries to operate outside of the law and building private prisons to make fortunes from incarcerating all the unhappy unemployed. We spend more money on killing people than anything else. Not food, not healthcare, not water, not space exploration, not roads: killing people. We are given words to make it OK, like "defending American interests", "supporting our troops" & "protecting our freedom". Nice, patriotic way to say murder.
Drugs & Alcohol - The war on drugs is a war on the American citizen. US anti-drug policy, combined with covert CIA drug harvest operations is responsible for more drugs on US streets than ever before. It is no coincidence that entire cities are devastated by drugs, crime, health & education issues as a result of the horrible failure and direct culpability of US anti-drug efforts. Any population too messed up on drugs or legal alcohol is not going to be in a position to challenge the status quo. Entire cities are doomed for this generation and the next because of drugs and alcohol.
Empire - Capitalism does not need to be: .01% of the population accruing all the wealth while the remaining 99.9% do all the work and pay all the debt. Yet, that is what have. The tyranny of the wealth-hoarding elite has brought wars, slavery, drugs, indentured servitude, corruption and hatred - foreign and domestic. The NeoCon vision of American Empire is an extension of the Confederate States vision for the same, which was an extension of the British Colonial ambitions. These groups all have one central goal: Privatized wealth and socialized debt.
Organized (Crime) Religion - the gold standard for propaganda and delusion. Especially fundamentalist religions. The narrow dogmatic views of intolerance, disinformation, literal adherence to fairy tales with conflicting conclusions all aimed at one thing: money. These (grifters) holy-rollers pile on the sacred word of an invisible being like a truckload of manure. Look at the religions in the way the FBI looks at mobters - follow the money. They go to Washington, DC and come back with funding. They go to church on sunday and come away with money. They preach abstinence only sex-ed. and tell us that God wants women to be in the home, pregnant and servile (and uneducated). Interesting how the one thing that breaks the cycle of poverty is the education of women and all fundamentalist religions oppose that very thing. Hmmm....follow the money. Poor people and uneducated people are in no position to challenge authority, thereby keeping Religion and their associates sitting firmly on top of the money again. And we fall for it because we think God will punish us for calling these lying thieves out for what they are. We get lies and live deluded lives while they get privilege, wealth and power. Our deal sucks, people.

We, the People have abdicated our responsibility and participated in our own genocide. 300 million Americans have stood by since the 1950's and allowed our government to be stolen. We have allowed over 1 million Iraqi deaths for two oil men to become more wealthy. We are addicted to the delusion that we have a chance to become one of the Great American Success stories. The truth is that unless we own the top .01% of this country's wealth, we are either house negroes or field negroes.
If we are going to work our way out of these addictions, we need to be honest in all the places we have lied. Yes, we lied. We are all liars. Get used to it. It's uncomfortable, sad and depressing. It is all those things and it is true. We punch the clock, go to work, pay our taxes and complain about our neighbors. Our tax money (and our great-grandchildren's tax money) is spent lining the pockets of the top .01% and people are murdered with bullets, bombs and knives that are funded by us.
This economic collapse is our fault. Not Wall St. Not Washington, DC. Me, you and the people next door. We sat on our asses, took the bribes offered to us by real estate bubbles, tech bubbles, mortgage bubbles, banking bubbles and a 50-year orgy of war profiteering. We used those bubbles to ignore what was going on with our tax money. We allowed ourselves to be bribed with promises of riches in the stock market, the possibility that we could be on Lifestyles of the Rich and Famous one day, if we caught the right trend. It was a delusion. We were tricked with greed and the only money were allowed to have were mere fractions of the hoards of wealth plundered from other countries and our own future.
The only way we sober up is to start with honesty. If we try to take shortcuts, we will only do what every addict does when they avoid responsibility for their real actions - we will relapse and prolong our addiction. There isn't anything easy about this. We won't be able to just go to work and not think about it much and then suddenly pick up a paper to see that things are getting better. That has never worked. That is how we got here in the first place. That is delusional thinking.
The war-profiteers, oil barons and other wealth hoarders are not going away simply because we want them to. They need to be publicly shamed, dragged out of the corridors of power, kicking and screaming because that is the only way they will leave. Our country has been stolen by people that are happy to make billions off the cultivation of human misery. These are the idealogical descendants of slave owners, tyrants and robber barons.
The cold, hard truth is that we went to sleep on the job and let them steal America. These people have existed since the dawn of time and we did not invent them. There may have never been a country that lived free of their foul manipulation of innocent lives, shepherding us like cattle for their profit and our doom. However, this country may finally be the one to break their influence and truly create a society where justice and liberty and the law of the land exist in place of delusion and tyranny.
The price for this dream, paid here in the very dark hours of despair, poverty and fear - is honesty.
"Brother, can you spare a truth?"
-gadfly

Conservative Republicans?

2009-03-01T13:48:00.000-08:00

This spreadsheet was created in the mid 1990's and has been updated periodically. The data was gathered from records available from the U.S. Department of Treasury. Link follows:
http://www.treasurydirect.gov/NP/BPDLogin?application=np
The ending dates for the Presidential terms was January 19th of the year indicated. The results are quite revealing. Use your own judgment. Please post your comments.

New White House Website

2009-02-18T13:22:00.000-08:00

Today marks the launch of the new White House website,
recovery.gov/
the one stop shop designed to keep the public informed and up to date on the American Recovery and Reinvestment Act:
As the centerpiece of the President’s commitment to transparency and accountability, Recovery.gov will feature information on how the Act is working, tools to help you hold the government accountable, and up-to-date data on the expenditure of funds.
The site will include information about Federal grant awards and contracts as well as formula grant allocations. Federal agencies will provide data on how they are using the money, and eventually, prime recipients of Federal funding will provide information on how they are using their Federal funds. On our end, we will use interactive graphics to illustrate where the money is going, as well as estimates of how many jobs are being created, and where they are located. And there will be search capability to make it easier for you to track the funds.
The first incarnation of Recovery.gov features projections for how, when, and where the funds will be spent -- which states and sectors of the economy are due to receive what proportion of the funds. As money starts to flow, far more data will become available.
The site features cool graphs, interactive maps, projected timelines of when the money will start pumping into the economy, and a place to share your stories and offer comments.
Check it out!

Help This Blogger

2009-02-17T11:54:00.000-08:00

If you have read this blog more than once please sign up as a follower, just click on follow this blog in the left hand column. Your comments also greatly appreciated. Comments may be entered directly below each blog.

Where do you get your news?

2009-02-17T11:17:00.000-08:00

Where do you get your news? Where you get your news says a lot about you. After all we make our decisions in most cases about current events based upon the news. During the late 90's at 5:30 in the evening I routinely set the TV to ABC World News Tonight. Eventually it dawned upon me that ABC newscasts appeared to me to be biased more and more to the right and that irritated me. I prefer unbiased news. ABC's slogan is, “More people get their news from ABC than any other source”, and thats to bad. It isn't just ABC its also NBC, CBS, CNN, MSNBC, and in particular Fox news that broadcasts biased news and opinion as truth. Television Networks and stations, radio stations, newspapers and magazines have owners, publishers, editors, and advertisers. All of these have a say in what news they will deliver and how it will be delivered. I am not a journalist but I remember enough from high school journalism to know that a good news story consists of, who, what, when, where, why and how, and that editorializing belongs on the editorial page, not on the front page. People making decisions based upon broadcast news often make poor decisions based upon faulty information. I personally feel that Fox News is nothing more than the propaganda arm of the NRC and very often what they are broadcasting is simply read from releases from the NRC, typos and all.
I have friends that haven't read a book or a newspaper since they graduated from High School or College. Education should be a lifelong endeavor for all of us and reading is essential to learning. We soon forget what we hear and what we hear is often misunderstood.
I have used the INTERNET as my primary news source for years. Yahoo and Google both provide headline news and detailed news stories. I can read most newspapers such as the New York Times, Omaha World Herald, Kansas City Star, and even the Hastings Tribune on demand getting todays news instead of yesterdays. My liberal side prefers to read the Huffington Post, Mother Jones, The Nation, and I follow the Daily Kos Blog religiously. The Internet also provides a number of fact checkers. The problem with most of these is that you need to check the accuracy of the fact checkers. Generally just boils down to personal judgment based upon the information available at the time.
Most of my friends have often regarded me as a contrarian and it is amazing as time passes how most of them come to the same conclusions that I held long before them.

Participatory Democracy

2009-02-14T12:13:00.000-08:00

Do you know that President Obama wants you to be a participant in our democracy? Thats different. The new web site for the White House is not only informative but offers any one who cares to the opportunity to lay in on whatever is on your mind. Check out the two following URL's.
http://www.whitehouse.gov/
http://www.whitehouse.gov/administration/eop/opl/
If you live in Nebraska you can interact at all of the following links.
http://www.newnebraska.net/
http://www.bennelson.senate.gov/
http://fortenberry.house.gov/
http://leeterry.house.gov/
http://www.adriansmith.house.gov/
http://www.congress.org/congressorg/home/

If you have a face book page use the search feature in the upper right hand corner of your page to search for anyone. For example if you want to lay in on the CNN conversation with Rick Sanchez, Anderson Cooper, or whomever,.just type in their name. You can also sign up for twitter and comment to your hearts content.
I've been writing to government officials for years often with little success but I've still tried to make my voice heard. With the technology available today it is much easier and much simpler,and more effective than ever before. I fully realize that for most people it is really difficult to find the time to participate, but it is your Country, your Democracy that is at risk, and it is your children's future. Find the time!
Your comments appreciated. Click on the comment bar below the post.

Random Thoughts

2009-02-12T11:04:00.000-08:00

RANDOM THOUGHTS
The best thing about waking up in the morning is, well, waking up again. At my age waking up again is truly amazing. It's almost like having a birthday every morning. One of the few benefits of aging is not having to jump out of bed and rush to get to work. I can take my time, smell and taste the coffee that revives me enough to make it to the shower. The bath which is off our guest room has a nice walk in shower and I really appreciate it. My morning shower is actually the highlight of my morning. Always have plenty of hot water and the time to soak it up. That morning shower always gets my blood circulating, revives my mind, and reminds me of how lucky I really am. Having grown up during the Great Depression of the 1930's when bath time was Saturday night in a galvanized bathtub sitting in the middle of the kitchen floor with little water (water had to be carried in and out of the house and heated in tea kettles)- it's easy to understand why the availability of a hot water shower on demand is such a luxury.
**********
It's quite refreshing to have a President that can complete a sentence using good English and one whom actually can read a book, He also seems to relish getting out of the Washington bubble which seems to insulate most of our elected Representatives from the reality of the rest of us. Takes a lot of courage to hold town hall meetings with unscreened crowds and answer random questions. I was especially impressed with his humanity in dealing with Ms. Hughes whose son had lost his programming job which caused them to loose their home and forced them to live in their car.
**********
Gripe of the day:
Having the news industry trotting out Senators John McCain, Lindsey Graham, & Mitch McConnell complaining that the “Jobs bill” isn't bi-partisan. They refused to participate in the formulation of the bill sticking to they're obsession with the failed policies of deregulation and lower taxes. What is it that they don't get about the voters rejection of their policies in November?
**********
Unbelievable:
Republican efforts to revise History. Now various spokesman are claiming that FDR caused the great depression of the 1930's. None of these revisionists were even born at the time and evidently lack the ability to read or they're too lazy to check facts. The 1930's depression was caused by unbridled, unmitigated, and unregulated pursuit of greed which caused the stock market crash of 1929. FDR took office in 1933.
**********
CSX Railroad Ad:
“Everything about our operation is designed to reduce fuel consumption and improve the quality of our air. Steel wheels rolling on steel rails is the most efficient way yet devised to move goods from place to place. The fact is, our trains can move a ton of freight 423 miles on a single gallon of fuel.”
Wonder why? Diesel locomotive engines are propelled by electric motors, not internal combustion engines. Electric motor driven transportation is 85% fuel efficient while ICE propelled vehicles are 35% efficient. The big diesel engines in locomotives run giant turbines which generate the electricity to operate the electric motors. Electric motors provide 100% torque at any speed

Open Letter to Republican Minority in Congress

2009-02-10T12:48:00.000-08:00

To the Republican Minority remaining in the House and in the Senate, I can only say that I am appalled at your current choice to put Party above Country. Most of you have held your current position in the Congress during the past eight years. Those years have proven to be disastrous to the country. The Reagan, Bush41, Bush43 dynasty ran out of gas and over the cliff taking the American economy and the hopes and dreams of many with it at the end of 2008. The Republican policies of less government and lower taxes have been a total failure. Less government in actual experience turned out to be only less regulation. Government actually grew and became more expensive under every Republican administration since Reagan. The only time during the last 28 years that government actually contracted was during the Clinton administration. Bush 43 and the rubber stamp Republican congress of which most of you were part of enabled the Federal debt to grow by 5 trillion dollars during the past eight years. In fact over the last 76 years beginning with the inauguration of FDR the Federal debt has increased by 8.4 trillion dollars under Republican administrations and 2.2 trillion dollars under Democratic administrations and, as always, I hear the Republican politicians and pundits resorting to pure Rovian spin tactics of blaming everything on the Democrats. The Republicans in Congress are again trying to tell us that the only way out of the mess that they have created is less government and tax cuts. Tax cuts do not create jobs. I challenge you to prove that any tax cut not accompanied with a corresponding spending cut ever resulted in creating a single new job.
I owned and operated a small chain of Convenience stores for a period of 32 years. I never once increased or decreased employees because of a tax cut or tax increase. The number of workers employed was governed by the needs of the business and the needs of our customers. For the 15 years following my career in marketing, I operated an accounting service for small businesses. During those 15 years, I did not experience a single client increasing employment due to a tax cut.
Republican sponsored tax cuts accompanied with increased spending has resulted in my grandchildren and great grandchildren being saddled with an 11 trillion plus Federal debt and sooner or later they will have to start paying for the blunders of the past. I call upon you, the Republican Minority, remaining in the Federal Congress to summon up the intellectual capacity and moral courage to recognize that your failed policies of the past do not work and will not work. The American voters spoke loud and clear to you in November. You should listen to them if you can not bring yourself to cooperate then you should get out of the way. The idea that 38 Republican Senators can filibuster legislation desperately needed to correct their own failed policies is ludicrous!
The Bureau of Labor Statistics latest official U.S. unemployment number -- 7.6% -- hit the headlines on Friday, February 6. And its jump from 4.9% a year earlier marks the largest annual increase in the unemployment rate since 1975. If you take the time to scroll down a little further on the page, you will find the Bureau of Labor Statistics “U-6” report in which unemployment is quoted to be 13.9%. This is a much more realistic estimate of total current unemployment. Many economists are convinced that to do nothing now will lead to 33% unemployment in the very near future. Republicans have a decision to make. Are you going to go blindly down the road repeating your mistakes of yesterday or are you going to try something different for the welfare of the Country?
I am a proud social liberal and also a proud fiscal conservative. I firmly believe that we have to pay for government, the government we have, not the government we wish we had. Once we start paying for government on a pay-go basis, then the American voter can start deciding which government programs work and which ones don't work, and then commence getting rid of what doesn't work. My grandchildren are fed up with their parents and grandparents allowing the Republican dominated federal government to charge the cost of government to them.
I fully realize that the National Economic and Recovery Act currently being debated in Congress will have to be paid for with borrowed money. Having grown up during the Great Depression of the 1930's, I am convinced that the federal government must intervene in much the same manner as FDR did during the 1930's. Contrary to a few Republican revisionists, FDR's “New Deal” did work. The only bump in the road that it ever incurred was in 1937 when the Republican budget hawks were temporarily able to intervene. I also know that as we get out of the mess we are in, we must hope for politicians with enough moral fortitude to convince the American voter that we absolutely must start paying for government!

Friday, February 6, 2009

2009-02-06T11:19:00.000-08:00

Finally have gotten around to starting this Blog. Will give me a place to write down all of those thoughts I have as comments. This Blog may be as many other Blogs are, a Blog that is only read by the Author. Today’s comments are limited to copying and pasting the following article which I wish everyone in the country would take the time to read. My comments will follow as the day’s go by.

By David Cay Johnston
David Cay Johnston is the author of Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and Stick You With the Bill).
January/February 2009 Issue From Mother Jones
For years now, whenever I've been invited to lecture students on how our tax system works, I have asked a simple question: What is the purpose of the United States of America? The most common answer, be it at prestigious universities, elite prep schools, rural community colleges, or crowded urban high schools, is this: To make people rich.
This should come as no great surprise. For anyone born after, say, 1970, the world has been shaped by Ronald Reagan's remaking of government's relationship with private interests—a vision of lower taxes, less regulation, and maximum economic leeway for those at the top. In this view, the pursuit of wealth is the warp and weft of America; everything else will follow.
By contrast, the preamble to the Constitution tells us the nation's reason for being in 52 words that can be reduced to six principles: society, justice, peace, security, commonwealth, and freedom. Individual riches don't make the list. They are a product of American society, not its guiding purpose. Progress, then, must begin with a return to the best of the values that created this Second American Republic—one born, it's worth remembering, from the failure of the Articles of Confederation, whose principles (weak government, unfettered capitalism) found their resurrection in the economic policies of the past three decades.
Even judged by its own yardstick, the trickle-down approach has failed to deliver: Rather than getting richer, we have been slowly impoverishing ourselves. While incomes at the very top have soared to levels beyond imagining even a generation ago, the average inflation-adjusted income of the bottom 90 percent of earners was lower in 2006 than it was back in 1973. And since 2000, the median income of all Americans has actually slipped, proof that tax cuts for the rich do not create general prosperity. Today, more and more of us do not have enough money to live on without going into debt. For each dollar of equity people gained in their homes from 1980 to 2006, they borrowed two—and while a portion of that is accounted for by poor decision making, much has to do with the sheer impossibility of making ends meet.
Debt payments—individual and governmental—now consume so much income that they are suffocating economic growth. Interest on the federal government's debt this year will eat up the equivalent of all the income taxes we pay from January until at least sometime in May. (Already, the financial system bailout has added more than $3 trillion to the national debt—see "$3.4 Trillion & Counting"—for an extra $170 billion in annual interest payments.) This keeps us from making productive use of our tax dollars—launching universal health care, rebuilding our crumbling infrastructure, or funding the research we need to transform our energy system. We've been sold on tax cuts as the best way to spur growth, but what we really got was weak job growth, a sinking economy, and a slew of tax deferrals that cause increasing revenue shortfalls and force the government to borrow even more—with all of us paying the interest.
For the past 14 years, on my former beat as the tax reporter for the New York Times, and now as a columnist for the trade journal Tax Notes, I have been documenting the myriad ways in which our economy has been recalibrated to take from the poor, the middle class, and even the affluent and give to large corporations and the very richest of the rich. I discovered, for example, that in 2000, people making between $50,000 and $75,000 paid the same share of their income to the federal government as those making more than $87 million, and that those making between $100,000 and $200,000 were taxed more heavily than those making $10 million—a state of affairs the Bush administration called "progressive" when I first reported it in 2005. Thanks to Reaganite economic policies, we have encouraged once-competitive industries such as oil, car manufacturing, accounting, and news media to congeal into unchecked (and now struggling) oligopolies. We have slashed the ranks of white-collar cops—the auditors and investigators whose beats are taxes, securities, food and drugs, pollution, etc.—and hamstrung those who are left. And we have transformed the idea that bankers would self-regulate from a crackpot notion into the essence of government policy, with results as predictable as if we removed all traffic lights and stop signs on the theory that most drivers are responsible.
Over and over for the past decade, our leaders argued that the fundamentals holding up our economy were strong. Now we know that this floor of shiny statistics merely concealed the rot below. But there is an upside to this realization: The economic crisis can help us clear away the rot and build a more solid foundation—one that elevates people over capital, kick-starts commerce, and removes some of the costliest barriers to individual success and national progress.
Change will not be easy, and the cost of cleaning up the current mess will be a huge drag on the economy in the near term. But we are, at last, at a turning point; we have a chance to end the socialism for the rich that put us into this hole. How? By, in effect, reverse engineering the debacle. Rewriting tax laws and financial regulations has been the principal vehicle for turning government into a subsidy system for the deep-pocketed and well motivated. It can work in reverse as well. President-elect Obama has offered some interesting ideas to make the tax code more fair—but by and large, his proposals amount to tinkering around the edges, not the kind of serious restructuring previous presidents, most notably Reagan, undertook.
Here's another way to go. We can start by eliminating some of the most spectacular tax giveaways and move on to doable, efficient steps toward shoring up our biggest asset—not stocks, bonds, or houses, but people. Best of all, much of this won't cost a penny; in fact, it will raise billions for the big tasks ahead.
Stop the Giveaways•••••••••
Quit Cooking the BooksBy law, companies must keep two sets of books, one for shareholders, the other for the IRS. As a result, many corporations routinely tell investors they incur millions in corporate income taxes, while the financial records they give the irs show they owe nothing or are due refunds. They do this by using tax shelters, offsetting income with losses from years ago, and employing countless other devices that make them look like paupers to the irs but money machines to investors.
It's time to require companies to use the same accounting rules across the board—and then demand immediate payment of unpaid taxes. This would align the interests of investors with those of taxpayers while eliminating the obvious moral hazard of keeping two sets of books.
Executives are sure to complain that such a retroactive change is unfair. But recall that in 2006, when Congress voted to raise taxes on the interest from teenagers' college funds, Sen. Charles Grassley (R-Iowa) said it is proper to end abusive practices retroactively. Perhaps now's the time to prove it; the treasury could use a few hundred billion dollars.
Make the Superrich Pay Their ShareBack in 1990, people making more than $1 million in today's dollars earned less than 0.8 percent of all the wages paid in America. Last year these multimillionaires sucked up more than 5 percent, squeezing everyone else. Also during this period, the number of people getting million-dollar-plus salaries grew 12 times faster than the number of workers overall, tax data show—this in an economy where, in 2007, one in three workers earned less than $15,000, more than three-fourths made less than $50,000, and 99 percent earned less than $200,000.
We may never get back to the pre-Reagan tax rate for the top earners (70 percent), but we should at least nudge it back to the Clinton-era rate of 39.6 percent, as Obama has proposed, and for simplicity's sake round to 40 percent. To motivate executives, publicly traded companies could still be allowed to give out unlimited stock bonuses, provided that the execs pay taxes on the shares, cannot sell them for three years after leaving a company, and then must spread sales over at least five years. This would create a powerful incentive to manage companies for long-term success, which is good for jobs—and a smart ceo could still get fabulously rich.
End Legal Tax CheatingThe marginal tax rate for cops and teachers is more than 40 percent—25 percent for income taxes and another 15 percent for Social Security and Medicare taxes. The marginal rate for some hedge fund managers, five of whom earned more than $1 billion in 2007, has been zero. That's because many of these speculators have been able to avoid taxes by operating through offshore partnerships under rules that let them defer income taxes. Executives, entertainers, and athletes also have been able to amass vast untaxed fortunes: For example, Roberto C. Goizueta, the ceo of Coca-Cola in the '80s and '90s, built a nest egg of more than $1 billion, but was able to defer taxes on most of it until he died.
Tax deferrals are one of the major tools for redistributing wealth upward. While most of us must pay each time we get a paycheck, executives and corporations can defer their taxes for years, even decades. When the treasury finally gets the money, inflation has eroded its value; in the meantime, government must borrow more, pay more interest, and collect more from everyone else.
A provision in the Wall Street bailout bill addressed the hedge fund part of the problem, but a more comprehensive fix would involve stopping all deferrals beyond the modest amounts allowed for retirement savings (up to $16,500 a year for young workers, a little more for those over 50). Executives could still defer taking some of their compensation—a way of loaning money to their companies—but only after they pay taxes. Everyone would play by the same rules, and the federal government could gain $100 billion or more each year—enough to fund Obama's health care plan twice over.
Invade the CaymansIn 1983 just 10 percent of America's corporate profits were funneled through places that charge little or no corporate income tax; today more than 25 percent of profits go through tax havens. The Obama administration could tell the Caymans—now fifth in the world in bank deposits—to repeal its bank secrecy laws or be invaded; since the island nation's total armed forces consists of about 300 police officers, it shouldn't be hard for technicians and auditors, accompanied by a few Marines, to fly in and seize all the records. Bermuda, which relies on the Royal Navy for its military, could be next, and so on. Long before we get to Switzerland and Luxembourg, their governments should have gotten the message.
Barring gunboat diplomacy (tempting as it is), there is no reason we cannot pass laws to block financial transactions with tax havens or even, Cuba-style, make it a crime for Americans to visit or do business with them without special permission. Congress could declare the hiding of funds a threat to national security and require that anyone with offshore assets disclose them to the irs within 30 days and pay taxes, interest, and penalties within 180 days. For the holdouts, temporary special teams in the irs and Justice Department could speedily pursue civil or criminal charges.
Wean Wal-Mart (and the Yankees)Did you know that the sales taxes you pay at most Wal-Marts go not to your state or local government, but instead pay back the cost of building the store? Sales-tax givebacks, as well as exemptions from property taxes, can amount to an extra 9 percent profit for retailers that extract concessions from local governments. That means not only a huge advantage for new arrivals over established, often locally owned, businesses, but also a direct hit to resources for local police, schools, and parks. The chain stores claim they are creating jobs. But basic economic logic says retail can add net jobs only when a population grows or incomes rise, and when those things are happening, market forces should be enough to spur new stores.
In a similar vein, the big four commercial sports make operating profits of $1.6 billion, Forbes has calculated—but their taxpayer subsidies exceed $2 billion a year (and that's before the estimated $864 million Mayor Bloomberg and Uncle Sam just handed to the New York Yankees), according to Neil deMause, coauthor of a book on sports subsidies. In other words, taxpayers literally provide all the profits of mlb, the nfl, nba, and nhl combined.
So it is that developer Theodore Lerner and his partners purchased the Washington Nationals baseball team in 2006 for $450 million, but stand to collect more than $1 billion in subsidies over the next two decades. In effect, the public bought them the team and gave them a $600 million tip. Using the tax code to eliminate any value in stadium subsidies would take care of this problem quickly and efficiently.
Cut Off the Utility ScamBecause they are regulated monopolies, our electric, natural gas, and water utilities must collect every part of their operating costs—including their income taxes—in the price they charge customers. Except that sometimes you pay for checks they never write: Oregon's Portland General Electric collected nearly $900 million from 1997 to 2006 for federal and state taxes, but actually paid less than $1 million. Xcel Energy, which runs electric utilities in eight states, collected at least $723 million for taxes it will never pay.
When utilities charge you for taxes they don't turn over to the government, customers pony up twice: once to pad the companies' pockets, the second time in higher taxes or government borrowing to make up for the shortfalls. Some states, such as Oregon, have moved to require that utilities hand over the taxes they collect, a push that companies (including Warren Buffett's PacifiCorp electric utilities) have been fighting hard. The federal tax code could easily be adjusted to make sure taxes embedded in utility rates are either paid or refunded to ratepayers.
Ground the Private Jet ExemptionSince 1985, executives have been able to take nearly free personal trips on company jets; all they pay is income tax on the value of the travel. Under federal rules, this travel is valued so low that flying a Boeing 737 equipped with a shower and master bedroom from New York to Paris costs an exec less than $500 as long as the company claims it is unsafe for him to fly commercial. (Try getting a middle seat in coach for that.) On top of that, companies get to deduct the full cost from their taxes. So if that Paris flight costs $100,000, government loses out on about $35,000 in taxes, and shareholders shoulder the remaining $65,000 in the form of reduced profits.
Congress should make executives using corporate aircraft for personal trips pay taxes on the actual cost of the travel. (And while they're at it, lawmakers should also look at rules that give corporate jets an unfair break on air-traffic-control fees.) This will not only improve the bottom line for companies by removing a subsidy for their top employees, but help commercial airlines bring in more high-fare customers. As a side benefit, it will trim some of the corporate flights that clog an already congested air-traffic-control system—saving the rest of us some time sitting on the tarmac.
Demolish the Mansion DeductionMuch as middle-class homeowners cherish it, the mortgage deduction functions mostly as another upside-down subsidy: Less than half of homeowners can use it, and for each dollar saved by those making between $30,000 and $40,000, those making $1 million or more save $380. (Canada, by the way, does not allow mortgage interest to be deducted at all, yet its home ownership rate matches ours.) If the goal is to help people get into their own four walls, a tax credit for principal paid by home buyers in the first few years of ownership would do far more. For a home worth $100,000, for example, such a credit could reduce income taxes by $2,000 a year for the first two years and $1,000 annually for the next three, saving the buyer $7,000.
Begin the Healing•••••••••
Defang the Loan SharksFor hundreds of years, enlightened governments have regulated interest rates to rein in loan sharks. Now Diff'rent Strokes' Gary Coleman pitches loans at 99.25 percent interest. Some "tax anticipation" loans cost the equivalent of 700 percent annual interest.
How did this happen? Back in 1978 the Supreme Court, confronted with a discrepancy between federal and state laws, threw out federal interest regulations and called on Congress to pass new ones. Instead, lawmakers milked the ruling for hundreds of millions of dollars in campaign contributions from credit companies eager to charge any rate they wanted. Thanks to interest deregulation, blue chip investment houses like Lehman Brothers got into the business of subprime mortgages while Goldman Sachs, JPMorgan Chase, Bank of America, and Wells Fargo bought or financed payday lenders that prey on the poor. In the three decades since interest-rate deregulation, credit card and other revolving debt has risen from $128 billion to $968 billion (adjusted for inflation), a 7.5-fold increase. Interest on this debt, at an average rate of about 18 percent, acts like a tax, leaving people with less to spend on the necessities of life.
But the industry wasn't satisfied with this credit boom, and so, in 2005, it prevailed on Congress (with a special assist from then-Senator Joe Biden) to pass a bankruptcy law making it much harder to restructure debt, no matter how predatory, even in case of job loss or illness. And in a little-publicized move, the Bush administration, over the protests of all 50 state attorneys general, also invoked an obscure clause in the 126-year-old National Bank Act to effectively invalidate state predatory lending laws. Repealing these anti-consumer provisions would cost the government nothing, but provide a real benefit for the economy in curbing banks' irresponsible practices, just as consumers are expected to do with theirs.
Save Our SavingsCompared with any other developed economy, Americans save far too little. In 2006, 55 percent of tax returns showed zero interest income from savings accounts. If we were to eliminate taxes on the first $500 of interest earned, people could set aside almost $17,000 with tax-free interest (assuming 3 percent interest) to cushion the shock of a layoff, accident, or illness. Congress could even match savings for low-income people dollar for dollar up to $500 per year, with the government share locked up for 10 years.
Protect PensionsA pension is simply wages deferred to old age, which is why federal law requires that corporate pension plans be run "exclusively" for the benefit of the members. But in the past two decades Congress has turned that promise into a cruel joke; thanks to a little-known provision inserted by lobbyists in 2006, for example, workers could conceivably lose up to 85 percent of their pension when a new buyer takes over a company, as my one-time coworkers at the Philadelphia Inquirer recently discovered.
The core problem is that Congress lets companies postpone setting aside pension funds year after year. It also allows them to record as investment gains what they expect to earn in the market—even when they make less or actually lose money. Three years ago these phantom pension gains at General Motors accounted for the carmaker's entire net worth, a telling example of how accounting rules can create economic mirages.
Employee stock ownership plans, devised as a way to help workers build wealth, have also been turned into credit lines for speculators. Government rules allowed buyers of companies to use esop money as part of their financing, putting workers' shares at risk. United Airlines employees lost most of their shares' value in the company's 2002 bankruptcy—while ceo Glenn Tilton got a $40 million compensation package. Employees of the media conglomerate Tribune Co. may see their esop go bust, too, but ceo Sam Zell's stake is not at risk—because he made sure his equity is guaranteed even if Tribune collapses. Congress should restore protections so that workers get 100 percent of what they were promised, even if taxpayers have to make up the shortfall. It could also hold hearings to shame executives who got rich by shortchanging retirement plans, and make it easier to seize the bonuses of those who looted pensions.
End the Burglar-Alarm SubsidyEach time police respond to a burglar alarm, it costs taxpayers $50 or more, for a total of $1.8 billion in 2002. More than $800 million of this hidden subsidy goes to adt Security, a subsidiary of Tyco, which was at the center of the Wall Street scandals eight years ago; in the '90s, Tyco started buying so many mom-and-pop alarm companies that it now controls nearly half of the market. Government data show that at least 94 percent of alarms are false, and a 2000 study in Seattle found that officers responding to alarms make one-ninth as many arrests as those just driving around in patrol cars.
In Los Angeles and elsewhere, the rise of gangs in the 1980s tracked a sharp decline in funding for parks and programs for young people. Ending the burglar-alarm subsidy and shifting the spending to youth programs would reduce crime (saving even more money) and help more kids grow up to become taxpayers instead of tax eaters. Washington could threaten to cut federal funding for any city that fails to charge the alarm companies the full cost of each response, thus encouraging companies to build more reliable systems.
Stop Indenturing StudentsOver the past 40 years, the cost of public colleges has doubled, and financing tuition is an $85 billion a year business for credit companies. Sallie Mae, the biggest of the private student loan companies, earns an average 48 percent annual return, three times the return of commercial banks. Students who sign up for loans with what appear to be low fixed rates may discover upon graduating that they face an 18 percent rate; if they make a single late payment, late fees will be tacked on every month until the debt is paid off. And the law makes no allowance for students who can't find a job in a bad economy, or can't work because of illness, or choose to serve their communities by, say, joining Teach for America. Albert Lord, Sallie Mae's chief executive, has become so rich from student lending that he built his own private golf course just outside the nation's capital.
Profiteering off students is not just an obscenity; it ultimately weakens the economy. The abuses at Sallie Mae and other student lenders deserve exposure via congressional hearings. Then perhaps lawmakers will find the spine to make the rules fairer. Indenturing the brightest young minds in an information society is the equivalent of eating your seed corn in an agrarian one. In the long run, you're doomed.
Drag the irs Into the 21st CenturyWhen the 16th Amendment establishing the federal income tax was being debated, advocates argued it would return some portion of "surplus incomes" to the commonwealth. The goal was to make those enriched by the new phenomenon of industrialization pay back the society that made their fortunes possible. Consequently the middle class paid very little; incomes of $3,000 (the equivalent of $66,000 today) were exempt from income tax, and in the lowest tax bracket you paid just 1 percent. Today a single person is taxed at 10 percent once she makes more than $8,950 (twice that for married couples). Social Security taxes start with the first dollar of wages and end at just more than $100,000.
Given the vast sums they have transferred to the superrich in the past 30 years, the 88 percent of taxpayers who make less than $100,000 a year deserve a break. Congress should lower their taxes with an eye toward restoring their capacity to save (thus, as a side benefit, generating fresh capital for investment), while at the same time studying how to create a high-wage economy that can generate more revenue.
At a deeper level, it's time for a national debate about how we can go from our existing federal tax system, which was well designed for the 20th century but now throws sand into the economy's gears, toward an efficient, effective system for sustaining a 21st-century democracy. Congress should begin by holding hearings and giving Treasury a budget for research into alternative revenue sources such as a value-added tax and taxes on greenhouse emissions.
Our nation was founded on the idea that we would shape our own destiny. Structuring our taxes is a critical part of how we do that; and no matter what Sarah Palin told us during the campaign, paying taxes that are fair and just is the duty of a patriot. Time and hard evidence revealed that Reaganism was a disastrous mistake. Now we must get through the terrible night and on to a real morning in America.
Related articles: Saving Private Industry; $3.4 Trillion & Counting
David Cay Johnston is the author of Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and Stick You With the Bill).
Comments:
Excellent article. Too bad so few people will ever hear what it has to say, and members of congress and the corporatocracy hope to keep it that way.Bottom line - unregulated free market capitalism is a giant failure, just as its opposite extreme ideology. Twenty eight years of Conservative economic policies have re-distributed the wealth to the 1% who own 2/3 of all the wealth from the middle class and working poor, but because they also own the media the people have been brainwashed into believing in this Conservative BS, despite the facts, which are rarely given to the people. Is there any hope for real change? I doubt it since our public "servants" make so much money out of this corporatocratic/oligarchic system. After all, they have excellent health care, free hair cuts and lunches, automatic raises (despite the failing economy) and enter into hugely profitable jobs with their "real" employers when they leave congress with huge "pensions" (which they have voted for themselves - just look at Bob Dole, who fought against "entitlements" for the average person, social security, medicare, medicaid etc., his whole career then retired with his full Senate salary, which they have voted for themselves, and perqs then went to work for one of the nation's largest drug cartel members, Gallo Wines, at a fat reward for his work all those years for them. This is all too typical) and all at the taxpayers' expense. I wish the article had mentioned the savings that could be made by forcing congress to reform and end its corruption and greed. How can we expect congress to make Wall Street reform when they are part of the same system?Congress needs an independent oversight committee to keep it honest and from voting on its own benefits, something the average person cannot do. What a great day it would be if congress voted the same benefits it has voted for itself to all the people!
Posted by:FreeThinkerJanuary 6, 2009 1:54:41
You have just listed the entire philosophy of the Bush Administration but you omitted uncontrolled military spending and being the world's policeman. The concept of being the only world power to confront the terrorism problem with military force instead of cutting off their funding by putting pressure on the Saudi's to stop them from financing terrorist groups with gasoline profits from us is also overlooked. Just enforcing our borders and cutting off the drugs and lowering our reliance on foreign oil would do much to put a lot of things back in order but then we are not real good at self control!
Posted by:Mr. IndependentJanuary 6, 2009 3:42:23

"For years now, whenever I've been invited to lecture students...I have asked a simple question: What is the purpose of the United States of America? The most common answer...is this: To make people rich." Actually, it was under President Reagan that students for the very first time gave as their reason for going to college, to make money. Previously, such virtuous goals as making the world a better place topped the polls. Yes, Republican Reagan and a Cult of Greed ushered in the end of the innocence. And today our economy pays the price for all those greedmeisters colleged in the '80s having worked their way up the corporate ladder.
Posted by:DavidJanuary 7, 2009 6:37:43 PM

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