Category Archives: Politics

Schumer Backs Reid Plan

25 Monday Jul 2011

Posted by in budget, Deficit, economy, Politics

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AP is reporting:

“The third ranking Democrat in the Senate says a deficit-reduction proposal put forward by Majority Leader Harry Reid has the best chance of ending the political stalemate and avoiding a government default.

New York Sen. Chuck Schumer tells MSNBC he expects the Nevada Democrat to release details of his plan later Monday. Schumer says the deal would last through 2012, cut spending by the same amount as borrowing is increased and contain no new taxes.”

Which is exactly what Boehner wanted from jump street. The Daily Caller, May 11:

“Boehner took the ambitious stand in negotiations to raise America’s debt ceiling while speaking to the Economic Club of New York, saying, “Without significant spending cuts and reforms to reduce our debt, there will be no debt limit increase. And the cuts should be greater than the accompanying increase in debt authority the president is given.”

While the Treasury Department has yet to specify exactly the size of the increase Congress will need to approve for the $14.3 trillion debt limit, estimates are currently settling in around $2 trillion. That means, according to Speaker Boehner, that the White House and congressional Democrats would have to agree to spending cuts equal to at least $2 trillion as well. The only thing “off the table” is tax increases, said Boehner.

So after 6 weeks of kabuki, we’re right back where all this began. And unemployment is still our biggest problem. Nice.

While the Senate Takes a Break, Four Thousand FAA Employees are Furloughed

23 Saturday Jul 2011

Posted by in Congress, Politics, Unemployment

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Dysfunctional government marches on. While the Senate takes a break, 4,000 FAA employees are now furloughed without pay:

“The Federal Aviation Administration (FAA) partially shut down Saturday, as Congress failed to reauthorize the agency’s funding.

“I’m very disappointed that Congress adjourned today without passing a clean extension of the FAA bill,” Transportation Secretary Ray LaHood said in a Friday statement. “Because of their inaction, states and airports won’t be able to work on their construction projects, and too many people will have to go without a paycheck. This is no way to run the best aviation system in the world.”

About 4,000 FAA employees are now furloughed without pay, according to the FAA, as the Senate on Friday failed to approve a controversial House-passed extension of taxes that help fund the FAA.”

That kind of careless inaction couldn’t possibly be responsible for this, could it?

“A new CNN poll finds that 55 percent of voters have a negative view of the Republican Party, tied for their second-highest unfavorable score since CNN began asking this question in 1992…The news for Democrats is not any better. Some 49 percent of voters now hold a negative view of the party, according to the poll. Although this figure is slightly better than for Republicans, it matches the Democrats’ record high unfavorable rating of September 2010 and is part of an upward trajectory that has persisted for the past three years.

The combined unfavorable score for both parties — 104 percent — is also a record, and represents the first time that the figure has been above 100.”

A well-deserved record. May the fleas of a thousand camels infest all their nether regions.

All the Bad News That Fits

23 Saturday Jul 2011

Posted by in Afghanistan, budget, Congress, economy, Iraq, Medicaid, Medicare, Obama, Politics, Social Security, Unemployment, Wall Street

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“I met a girl who sang the blues, and I asked her for some happy news. She just smiled and turned away.”

In the latest episode of “As the Debt Ceiling Turns”; Boehner walks, Obama has a hissy fit, and Pelosi throws yet another plan into the mix:

“House Minority Leader Nancy Pelosi acknowledged Friday that Democrats may reluctantly accept a last-minute compromise to avoid a default that involves up to $2.5 trillion in spending cuts — without agreed-upon new tax revenues — if Medicare, Medicaid, and Social Security are protected from the debt limit brinksmanship.”

Yes, by all means, let’s cut spending. Never mind this:

“Companies are laying off employees at a level not seen in nearly a year, hobbling the job market and intensifying fears about the pace of the economic recovery.

Cisco Systems Inc., Lockheed Martin Corp. and troubled bookstore chain Borders Group Inc. are among those that have recently announced hefty cuts, while recent government numbers underscore how companies have shifted toward cutting jobs.

The increase in layoffs is a key reason why the U.S. recorded an average of only 21,500 new jobs over the past two months, far below the level needed to bring down unemployment, which now stands at 9.2%.”

Or this:

“Initial weekly unemployment claims increased to 418,000. The 4 week moving average is 421,250. A weekly average above 400,000 does not indicate job growth and we now have a pattern of perpetual disaster for U.S. citizens trying to earn a living.”

About that default deadline, is it August 2, August 10, or August 15? Nobody seems to know for sure.

The Money Party has some questions and answers on Obama’s handling of the budget never let a good crisis go to waste. Here’s just one:

“Question:  Why did President Obama put Social Security and Medicare on the table in the budget negotiations when 80% of the people oppose cuts to these programs?

Answer:  The president is not in office to represent those people.  He was selected, funded and carried over the finish line by corporate America.  Look at the appointment of Wall Streeter Timothy Geithner, the bailouts, and the failure to prosecute any of the crooks who caused the current recession. He’s serving the people who put him in office.  Those people don’t need Social Security and Medicare.”

Not only serving the people who put him in office, but serving those who he is depending on to keep him there:

“Among big fundraisers, Obama has drawn close to a third of his money from people in the finance industry, up from 20% during his 2008 campaign, according to an analysis by the Center for Responsive Politics.

The amount raised so far is more than two-thirds what Wall Street elites helped Obama raise in his entire 2008 campaign. And it is enough to make the finance world the single largest source of big-ticket donations for Obama.”

While we cut the social safety net out from under our most vulnerable at home, billions are going unaccounted for in Afghanistan:

“SIGAR [Special Inspector General for Afghanistan Reconstruction] found that U.S. agencies have limited visibility over U.S. cash that enters the Afghan economy — leaving it vulnerable to fraud and diversion to the insurgency…”SIGAR auditors found that U.S. agencies have not done all they can to safeguard U.S. funds, and the Afghan government has not provided the cooperation needed to build a strong, secure financial system.”

Also on the Endless War front, the State Department is telling the Special Inspector General in Iraq to mind his own business when it comes to State’s mercenary army in that country:

“By January 2012, the State Department will do something it’s never done before: command a mercenary army the size of a heavy combat brigade. That’s the plan to provide security for its diplomats in Iraq once the U.S. military withdraws. And no one outside State knows anything more, as the department has gone to war with its independent government watchdog to keep its plan a secret.

Stuart Bowen, the Special Inspector General for Iraq Reconstruction (SIGIR), is essentially in the dark about one of the most complex and dangerous endeavors the State Department has ever undertaken, one with huge implications for the future of the United States in Iraq. “Our audit of the program is making no progress,” Bowen tells Danger Room.

For months, Bowen’s team has tried to get basic information out of the State Department about how it will command its assembled army of about 5,500 private security contractors. How many State contracting officials will oversee how many hired guns? What are the rules of engagement for the guards? What’s the system for reporting a security danger, and for directing the guards’ response?

And for months, the State Department’s management chief, former Ambassador Patrick Kennedy, has given Bowen a clear response: That’s not your jurisdiction. You just deal with reconstruction, not security. Never mind that Bowen has audited over $1.2 billion worth of security contracts over seven years.”

To be continued…unfortunately.

Remember the Public Option

22 Friday Jul 2011

Posted by in budget, Deficit, health care, Obama, Politics

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Shortly after the New York Times broke the story yesterday that a so-called “grand bargain” (which if reports are accurate is neither grand nor much of a bargain) had been reached between President Obama and Speaker Boehner, White House spokesmen immediately sprang into action. Press Secretary Jay Carney said “there is no deal, we’re not close to a deal” and Dan Pfeiffer tweeted:

“Anyone reporting a $3 trillion deal without revenues is incorrect. POTUS believes we need a balanced approach that includes revenues.”

The Times account may or may not be true, we shall see in the next few days I suspect, but reading a post at AMERICAblog this morning reminded me of previous occasions when the White House kinda sorta fudged a bit on the truth, to be generous.

Like when the same Dan Pfeiffer said in October of 2009 that the rumors about President Obama abandoning the public option as part of health care reform were “absolutely false” and that:

“In his September 9th address to Congress, President Obama made clear that he supports the public option because it has the potential to play an essential role in holding insurance companies accountable through choice and competition.  That continues to be the President’s position.”  

It was later revealed that in July the president had made a secret deal with hospital lobbyists that a public option would not be included in the final legislation. In March of 2010 Paul Hogarth at Huffington Post wrote:

“In other words, while Obama was still saying in September that he supports the public option (which kept us hopeful) – the President knew all along that it would never make it in the final bill. He never said he’d fight to include the public option, and repeatedly said he was “open” to other ways to achieve the same goal. But little did we know, the fix was in.”

I also recall that there was a similar situation with the pharmaceutical industry. The president continued to voice support for drug importation after another secret deal had already been cut with lobbyists that it wouldn’t be in the final legislation either.

FWIW.

What Perry’s Done To Texas, He’ll Do To America

21 Thursday Jul 2011

Posted by in Politics, Texas

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Take it from someone who knows firsthand, my fellow Americans, you don’t want this guy anywhere near the White House.


Don’t be fooled by the hair and the smile, Rick Perry is a disaster. Just the latest example:

“The long and the short of it is this: Texas has abandoned its children. The Governor and the Legislators in Austin have set the stage for a protracted crisis not only in education but in the State economy. With respect to the former, we can look forward to larger class sizes, the elimination of many important programs, and the placing of even more responsibility of the backs of overworked (and fewer) teachers.

Texas already ranked an embarrassing 44th in education and these developments do not bode well for future of the Lone Star State. As far as the economy is concerned, every public education layoff means less income not only for those individuals, but for local businesses where they would have shopped.

[…]

Furthermore, the lack of a decent education will greatly reduce the future earning power of Texans. The only firms willing to relocate here will be those hoping to find a source of cheap, low-skilled laborers. Texas will become the alternative to outsourcing to an impoverished, third-world country. The stars at night no longer look so big and bright.

Was this fiscal crisis the inevitable outcome of the Great Recession? The answer is absolutely, unequivocally, no. In fact, it is hard to avoid the unsettling conclusion that it was deliberate, that certain State Legislators and the Governor did this on purpose.”

Read the rest and ask yourself, is this what you want all of America to look like?

Obama Hearts the “Gang of Six” Plan

20 Wednesday Jul 2011

Posted by in budget, Congress, economy, health care, Medicaid, Medicare, Obama, Politics, Social Security, Taxes, Unemployment

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President Obama was quick to endorse the latest deficit reduction plan, the one from the so-called “Gang of Six” released yesterday, calling it a “very significant step” and “broadly consistent with the approach he has advocated.” This without knowing the details. But the details weren’t really important, because all the major elements are indeed consistent with what the president wants in this deficit reduction shell game.

* Medicare, Medicaid, and Social Security cuts.
* Further cuts in the top marginal income tax rates. (So much for that pledge to let the Bush tax cuts expire).
* Corporate tax cuts.
* The continuation of Reaganomics and Bushonomics. That would be the supply-side, tax cuts equals increased revenue and economic growth nonsense that we all know works so well.

The broad strokes of the “Gang of Six” plan (and just as an aside I wonder why Sen. Sanders is never included in any of these gangs? Not bi-partisany enough, I assume) are as follows:

An immediate $500 billion “down payment” on deficit reduction. All spending cuts, all from unnamed programs. A brilliant idea in a recession. The other $3.2 trillion in savings would be decided by various committees at some later date, enforced by spending caps. Congress would be required to get a 2/3 vote to exceed those caps. IOW, when the next recession hits, anybody looking for any assistance is SOL. David Dayen at Firedoglake:

“Simply put, this is a recipe for depression. When the economy suffered and stimulus would be required to increase aggregate demand, the 2/3 vote needed would simply put a stop to it. The New Deal would have been out of order under this regime. Same with the Recovery Act. Any spending from the federal government would be restricted as much as it is in the states. So there could only be the status quo or contraction in fiscal policy in the event of a recession, which is a perfect way to create a depression.”

Also in the down payment would be the institution of chained CPI, aka a cut in SS benefits, and repeal of the CLASS Act, which was a part of health care reform that the insurance lobby fought tooth and nail. From the New York Times, December of 2009:

“The Class Act, which the late Sen. Ted Kennedy considered his legacy, would allow people to buy long-term care insurance through payroll deductions and to receive cash if they’re later disabled, regardless of their age or of a previous health condition. “This is the best chance the baby boomers have to protect themselves from impoverishment if they need long-term care,” Mr. [Jim] Firman [president of the National Coalition on Aging] said.”

That is Part One. Part Two calls for an additional $200 billion in “healthcare savings,” aka Medicare and Medicaid cuts, and an $80 billion cut in the defense budget. That’s $80 billion over ten years, pocket change for the Pentagon. Gotta love that shared sacrifice.

In Part Two, the Finance Committee…

“…would be required to reduce tax rates to three tax brackets of rates: of 8-12 percent, 14-22 percent and 23-29 percent. The current top marginal rate is 35 percent. The corporate tax rate would be between 23 percent and 29 percent…”

And this little goodie for corporations as well:

“…tax reform would cease taxation of overseas profits.”

The corporate behemoths had been lobbying to get the tax on overseas profits reduced, allegedly under the guise of returning these profits for use in job creation, but that’s not how it worked before:

“Congress and the Bush administration gave companies a similar tax incentive, in 2005, in hopes of spurring domestic hiring and investment.

While the tax break lured 800 companies into bringing $312 billion back to the United States, 92 percent of that was used for dividends and stock buybacks, according to the nonpartisan National Bureau of Economic Research. The study concluded the program “did not increase domestic investment, employment or research and development.”

Indeed, 60 percent of the benefits went to 15 of the largest U.S. multinational companies — many of which laid off domestic workers, closed plants and shifted even more profits and resources abroad in hopes of cashing in on the next repatriation holiday.”

So let’s just eliminate the tax entirely. Nice.

More on the tax “reform” aspects of this plan:

“Coburn said the plan would reduce the deficit by $3.7 trillion over the next 10 years and increase tax revenues by $1 trillion by closing a variety of special tax breaks and havens. He also noted, however, that the Congressional Budget Office would score the plan as a $1.5 trillion tax cut because it would eliminate the Alternative Minimum Tax.”

I’m not sure how that works. How is $1 trillion in revenue increases scored as a $1.5 trillion tax cut? But I know for sure how this works, it doesn’t:

“It would generate a significant amount of revenue out of tax reform and reduction of tax rates, which authors believe would spur economic growth.”

And I believe in the Tooth Fairy and the Easter Bunny.

9.2% Unemployment is Fiction, 16.2% is Reality

19 Tuesday Jul 2011

Posted by in economy, Politics, Unemployment

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Economic Populist has a graph showing why the “official” unemployment rate of 9.2% should be disregarded as a disingenuous statistic intended to make the unemployment picture look better than it actually is, and why the U6 rate of 16.2%—which includes unemployed, underemployed, and those who have given up looking—is a much more accurate indicator:

“JOLTS stands for Job Openings and Labor Turnover Survey. The July 12th report on May 2011 data shows there were 4.68 official unemployed people hunting for a job to every position available.

If one takes the…broader definition of unemployment, or U6, in May at 15.8%, the ratio becomes even worse, 8.28 unemployed people per each job opening for May. Bear in mind U6 jumped to 16.2% in June. Below is the graph of number of unemployed, using the broader U6 unemployment definition, per job opening.


Here’s proof:

“Some 16,837 people showed up at the local Kentucky Office of Employment & Training in the past week seeking jobs at Ford’s Louisville Assembly Plant.

The deadline was today to submit an application and a lottery tomorrow picks who gets to go on for consideration by Ford for the jobs paying $15.51 per hour. The number who’ll advance via the lottery wasn’t disclosed.

Sadly, the odds are that very few of these folks will become one of the 1,800 more workers Ford says it needs to reopens the plant in November…”

16,837 people divided by 1,800 openings comes out to roughly 9.3 applicants per job. A lot closer to 8.28 that 4.68.

House Dems Tackle the Styrofoam Cup Crisis

14 Thursday Jul 2011

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It’s good to know all the trivial matters before the Congress are taken care of so they can concentrate on the really important stuff:

“House Democrats are once again attempting to do away with Styrofoam products in congressional cafeterias, this time with an amendment to a fiscal 2012 Legislative Branch Appropriations bill. Rep. Jim Moran (D-Va.) introduced an anti-Styrofoam amendment on Wednesday during an Appropriations Committee markup.

[…]

The amendment stipulated that “none of the funds made available in this act may be used to obtain polystyrene products for use in food service facilities of the House.”

“The House of Representatives should serve as a model institution for others to follow,” said Moran. “Eliminating the use of polystyrene in our cafeterias is [the] responsible, environmentally-friendly thing to do but the new Republican House Majority has again made clear they could care less.”

[…]

“This is a case of the Republicans being spiteful and stupid,” Rep. Debbie Wasserman Schultz (D-Fla.) told The Hill in March. “Not only are they harming the environment, they’re taking the Capitol, instead of being an example, back to the Stone Age.”

Cave men had their morning coffee in styrofoam cups? Who knew?

“The amendment is not the first step taken by Moran to rid the House of Styrofoam. In March, he was one of 105 lawmakers to send a letter to House Speaker John Boehner (R-Ohio) and other Republican leaders complaining that the material could cause cancer.”

I can’t for the life of me figure out why congressional approval ratings are so low.