Saying “Fiscal Cliff” Is Taking Sides

The term “fiscal cliff” is a one-sided propaganda phrase that misinforms and triggers public fear and anxiety. The fiscal cliff is not a “cliff” and the country isn’t going to fall off anything at the end of the year. Journalists: don’t help the misinformers — don’t say or write “fiscal cliff.” Congress: when people are scared and misinformed our Congress should pause, step back and help inform us instead of rushing to take advantage of the fear.

What The Fiscal Cliff Is

At the end of the year the Bush tax cuts expire and several budget cuts start to phase in (including military spending cuts.) This reduces the deficit, and some of those cuts will slow the economy if nothing is done to restore them in the next several months. That is the “fiscal cliff” that you are hearing so much about. Except it isn’t a cliff, it kicks in gradually, Congress has a lot of time to work it out and can fix anything that is a problem.
That’s right, if nothing is done in the next several months — there is no “cliff” at the end of the year — some of those cuts will slow the economy. All the screaming and hysteria are about putting pressure on the “lame duck” Congress to do something in a big hurry, outside of the accountability of democracy and before the President and progressives have more leverage.

What The Fiscal Cliff Is NOT

Most people I talked to over Thanksgiving apparently think the “fiscal cliff” is the government runs out of money on December 31 because the deficit is so big and all kinds of terrible things happen on January 1. This is sort of the opposite of what is going on. Even the few who didn’t think it was about the country running out of money were misinformed in one way or another, with most thinking something terrible happens January 1.
The “fiscal cliff” is about taxes going up and budget cuts, which reduce the deficit. And absolutely nothing in anyone’s life will change on January 1, or for some time (weeks, months) after.
That’s right, all the people who were hysterically screaming about the deficit are hysterically screaming now because of deficit cuts. Go figure. But the reason is that they have an agenda.

Journalists Should Not Help Misinform And Scare People

The very term “fiscal cliff” misinforms and scares people. Some media outlets, like FOX News, exist to misinform and scare people. But responsible media outlets should try to help the public understand complicated issues, not help scare and misinform.
Any journalist using the propaganda phrase “fiscal cliff” is taking the side of misinforming and scaring.

Settle Down, Beavis

Everyone should settle down. There is no “cliff.” No one is going to fall off of anything. And after the first of the year the President and progressives have much more leverage in this fight than they do now — hence all the pressure to act before then.
When people are this misinformed and scared the Congress owes it to the public to stop, take a break, work to inform the public and not act in a panic. Journalists, especially, owe it to the public to inform, not misinform and scare.
Update – I wrote this and went to bed. I wake up, and there is a perfect example in the Monday NY Times titled, Debt Reckoning, The Fiscal Deadline In Washington. The write-up in the morning NYTimes email is “The New York Times is beginning a new online feature that will chronicle the talks on the fiscal cliff between President Obama and Congressional leaders.”
The clear message of this headline and summary is that the country is in crisis because of debt. The public cannot help but get the impression that the country goes broke in a few weeks. As I explained above (and as Paul Krugman explains today’s in Fighting Fiscal Phantoms) this is really the opposite of what is happening.

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Pension Gimmicks Blamed On Workers

The student loan deal is badly needed. It should have just been extended – duh! But the 1 percenters took it hostage and demanded their pound of flesh before We, the People can preserve even this little bit of what we do for ourselves. So as part of the “sweetener” for those 1 percenters there is a corporate pension giveaway in the deal that has nothing to do with student loans. It appears they are going to let companies underfund pensions — money that should be set aside for worker pensions tomorrow will instead go into 1 percenter pockets today — and are setting up for a taxpayer bailout (or just stiffing retirees) later.

Pension Calculations Are Tricky But Regulated

This is kind of tricky, so bear with me. When companies (and governments) put money into pension funds they have to calculate how much will be needed to pay the promised pensions. This involves estimating things like how long (and how many) people will live, and how much “return” (interest, stock price increases,dividends…) to expect as the money is set aside. Key point: If you expect a too-high rate of return you can set less aside now (and put it in your pocket,) but when the time comes to pay the pensions you won’t have enough.
This is supervised by government standards and regulations. They say how much of a rate of return is allowed to be used in these calculations. A higher expected-rate-of-return allowance means less has to be set aside, so more money can go into 1 percenter pockets. So there is a lot of pressure from corporations to let them get away with overestimating, and therefore putting more in their pockets today. Since this is complex, it is easier to get away with diverting promised-worker-retirement money into 1 percenter pockets.
This student loan deal apparently lets corporations claim a higher expected rate of return, thereby diverting more money today into 1 percenter pockets.

Money Into Worker Pensions Or 1 Percenter Pockets?

For a long time the government has been allowing pension funds to use a too-high estimated rate of return, with the result that many pensions are now underfunded. Money that should have gone into savings to pay worker pensions was diverted into 1 percenter pockets, either through improved corporate bottom lines in the case of companies, or through lower taxes in the case of state & local governments. (Of course, many companies shifted worker-pension promises into 1 percenter pockets using the 401K scam — you fund your own retirement, on your own, with little help, and have to know how long you’ll live, and it turns out badly every time — but that’s for another post.)
In fact, this worker-set-asides-for-later vs 1 percenter-pockets-today issue is similar to what happened with the Social Security Trust Fund. Money from workers was set aside into the fund but was used to pay for tax cuts (and massive military increases). Now 1 percenters are demanding austerity — cutbacks in the things We, the People do for each other — instead of workers getting the money back from where the money went, namely the 1 percenters.
And since this is about money for worker retirees, and retired workers don’t have big, influential PR firms while 1 percenters do, it is convenient and easy to blame workers when the promised money isn’t there for their retirement.

The Much-Hyped Public-Employee Pension Crisis

The supposed public-employee pensions crisis is partly the result of state and local governments not setting aside enough money to pay up on pension promises (because of tax cuts). It is also partly caused by Wall Street scamming on those same governments as they got into riskier investments trying to get a high enough rate of return to make good on their pension promises. But the blame is being placed on the workers themselves.
The post Discover The Network Out To Crush Our Public Workers traced just a few of the corporate-conservative think tanks (really just PR firms) promoting the idea that public-employee unions are responsible for pension shortfalls. Almost all of these organizations traced back to Wall Street firms and individuals for their governance or funding. They are engaged in a campaign to divert attention and blame the workers themselves for pension shortfalls,

These corporate/conservative organizations are very good at manipulating the media and public opinion — it is their purpose. Their “experts” are well paid and always available to talk to reporters, appear on TV and radio shows and write articles and opinion pieces for newspapers, blogs and for their network of similar organizations. Their “reports’ and “studies” reach the conclusions that fit the strategy, and are crafted to sound just right. And there are so many of them! The result is development of “conventional wisdom” about what is going on in our society. This is why that conventional wisdom more and more reflects the corporate/conservative line. And right now the corporate conservative line is that we should think that public employees and their unions are responsible for state and local budget shortfalls.

See also Understanding The Attacks On Public Employees, Ten Holiday Attacks On Public Employees and Are Public Employee Unions Strangling Us? Also, Rick Smith And Dave Johnson Counter The Attack On Public Employees.

Others See It, Too

NY Times Editorial, The Deal on Student Loans,

The pension provision is not ideal. It could mean that more companies will underfinance their pension liabilities, shortchanging employees down the road. Lawmakers have tried to address that potential shortfall by strengthening the agency that insures private pensions with more money from higher premiums.

Thus from the Competitive Enterprise Institute, usually a most unreliable source. (The check from the big corps who want to underfund pensions must have been late.) In this case it is the same gimmick but added the the highway bill…: Threat of Pension Fund Bailouts Lurks in Senate Highway Bill, “Pension Smoothing” a License to Make Up Numbers,

The bill … would amend the Employment Retirement Income Security Act (ERISA) to allow for an accounting gimmick known as “pension smoothing,” whereby pension managers spread losses out over several years, while overestimating projected investment returns.
Specifically, this provision would expand the range of allowable projection figures, starting this year at a 20 percentage point range, to 60 percentage points after 2015. This is essentially a license to make up numbers for income projections four years out from now. …
“This accounting trick will likely expose taxpayers to potential pension fund bailouts in the future. ” …
“It would further remove pension investment return projections even further from reality, by expanding the range of allowable projections so broadly as to render them meaningless.”

Making Things Worse

To get a deal that keeps student-loan interest rates low enough for more people to afford to go to college, we had to pay off the 1 percenters with this “pension-smoothing” deal. Such is the way of Washington since we shifted from a democracy (rule by the people, for the people) to a plutocracy (rule by the rich, for the rich). Or, in this case a 1 percenter kleptocracy (rule by the rich, stealing from everyone).
But make no mistake, this deal makes the country’s future pension problems even worse. It diverts even more money from promised pensions into 1 percenter pockets. The result will be clear in 10, 20 or 30 years when people are retiring and the money isn’t there. Taxpayers will be asked for ever more “austerity” to cover money that was diverted to the 1%.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Sen. Sanders’ Plan To Actually Fix Social Security

You hear over and over that Social Security is “in trouble” or that we “can’t afford it.” This is as far from true as can be, and the idea behind this is to convince people to just give up on defending the program and let the haters have their way. The people who hate Social Security the most are the ones who say they want to make these changes to “save” it. Well Bernie Sanders loves the program and has introduced a bill that actually will save it.
The Haters
Conservatives have hated Social Security from the start, because it is a program that demonstrates once and for all the value of progressive governance. Social Security is as clear an example of We, the People watching out for and taking care of each other as there ever was. It has made a huge difference n the lives of older people, and their/our families. It works, is cost-effective and requires minimal overhead to keep it going. So they hate it.
A very recent example of conservative hatred for Social Security came from Senator Marco Rubio of Florida, who said, that We, the People helping each other makes us weak,

“These programs actually weakened us as a people. … All of a sudden, for an increasing number of people in our nation, it was no longer necessary to worry about saving for security because that was the government’s job.”

Substitute the words “We, the People” or “each other” for “government” in Rubio’s statement and you’ll get the point: people don’t have to worry so much because we’re taking care of each other. He says that makes us weak. Yikes!
Decades Of Attacks
For decades conservatives who hate Social Security have been using every trick in the book to turn people against the program. Over and over you hear, “It’s a Ponzi scheme.” “It won’t be there for you.” This latest attack is that it “makes us weak.” And of course the old classic: “Social Security is broke.”
The “it’s going broke” and “won’t be there for you” attack strategy goes back to a 1983 Cato Institute Journal document, “Achieving a Leninist Strategy” by Stuart Butler of Cato and Peter Germanis of the Heritage Foundation. The document is still available at Cato, and select quotes are available at Plotting Privatization? from Z Magazine. If you have time it is worth reading the entire document (in particular the section “Weakening the Opposition”) to more fully understand the strategy that has been unfolding in the years since. But if you can’t, the following quotes give you an idea:

“Lenin recognized that fundamental change is contingent upon … its success in isolating and weakening its opponents. … we would do well to draw a few lessons from the Leninist strategy.”
” construct … a coalition that will … reap benefits from the IRA-based private system … but also the banks, insurance companies, and other institutions that will gain from providing such plans to the public.”
“The first element consists of a campaign to achieve small legislative changes that embellish the present IRA system, making it in practice a small-scale private Social Security system.
“The second main element … involves what one might crudely call guerrilla warfare against both the current Social Security system and the coalition that supports it.”
“The banking industry and other business groups that can benefit from expanded IRAs …” “… the strategy must be to propose moving to a private Social Security system in such a way as to … neutralize … the coalition that supports the existing system.”
“The next Social Security crisis may be further away than many people believe. … it could be many years before the conditions are such that a radical reform of Social Security is possible. But then, as Lenin well knew, to be a successful revolutionary, one must also be patient and consistently plan for real reform.”

Here is what to take away from this: Every time you hear that “Social Security is going broke” you are hearing a manufactured propaganda point that is part of a decades-old strategy. Every time you hear that “Social Security is a Ponzi scheme” you are hearing that strategy in operation. Every time you hear that “Social Security won’t be there for me anyway” ” you are witnessing that strategy unfold.
The Problem
The Social Security program is entirely self-funded, separate from the way that the government taxes and spends for other programs. People set aside money in their working years, they get a monthly amount when they retire. (The program also has other benefits including disability benefits, survivors funds and others.) Social Security does not contribute to the deficit in any way.
You never hear that the huge, vast, bloated, enormous, mammoth military budget is “going broke” or “won’t be there for you.” But year after year you hear that Social Security is “in trouble.”
Currently the program has built up a huge trust fund — over $2.5 trillion. This is invested in US Treasury Bonds, and is earning interest. But there are projections that this trust fund will be depleted in approx. 2037, and if this happens the program will have to cut payouts by as much as 25%. (Hey. when does the military budget Trust Fund run down?)
One big reason for this shortfall is that the last time the programs was comprehensively adjusted (1983, Greenspan Commission) certain economic growth and income projections were used to decide how much “payroll tax” to take out of people’s paychecks. They increased the amount taken out of paychecks, and set up an increasing “cap” on the income that would be taxed. Right now 6.2% (temporarily reduced to 4.2%) is taken out of paychecks, and employers kick in another 6.2%, on income up to a “cap” of $106,800. There is no “payroll tax” on amounts above that “cap.”
But something changed between 1983 and now: almost all the income gains have gone to a few at the very top. Instead of people who mostly were under that “cap” getting raises, thereby increasing the amount they pay into the fund, the raises went to people who already pass that amount, so the increased income is not contributing to the program. So that money that was calculated would go into the Social Security Trust Fund instead went to the top few. As a result the program is no longer bringing in enough money to keep the trust fund fully-funded past 2037.
Sen. Sanders’ Solution
Senator Bernie Sanders is introducing a bill to the Senate to fix this, once and for all. In simple terms, this bill will start taxing income above $250,000 a year to cover this Social Security shortfall. So instead of just “raising the cap” it lets that cap stay, and then takes it off again on income above $250,000. In effect it means there will be a gap between the current top income that is taxed, and $250K.
Get the money from where the money went: So because much of the real Social Security problem is that so much income is now going to just a few at the top, this gets the money to fix the problem from those top-level incomes.
Here is Sanders, talking about his bill:

“When [Social Security] was developed, 50 percent of seniors lived in poverty. Today, poverty among seniors is too high, but that number is ten percent. Social Security has done exactly what it was designed to do!”

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Businesses Hire When Customers Are Coming In The Door

Another bad jobless claims report… and this time Washington seems to have finally noticed that there are some unemployed people out here in the sticks. But instead of jobs programs the geniuses are proposing … what else? … even more tax cuts. (And after a few hours they’ll go back to complaining about deficits but blame “spending.”) And of course, they are once again trying to “appeal to Republican lawmakers” without getting it that Republican lawmakers are doing everything they can to slow job growth so they can win the next election.
Bloomberg: Payroll-Tax Break Said to Be Discussed by Obama Aides Amid Slowing Economy,

President Barack Obama’s advisers have discussed seeking a temporary cut in the payroll taxes businesses pay on wages as they debate ways to spur hiring amid signs that the recovery is slowing, according to people familiar with the matter.
. . . The talks reflect the political constraints the White House is operating under with the Republican majority in the U.S. House pushing to cut federal spending. A hiring stimulus based on a tax break for employers may appeal to Republican lawmakers, many of whom have called for measures to help businesses.

Companies Only Hire When Customers Are Coming In The Door
Here is something the geniuses haven’t noticed, in all their geniosity: It doesn’t matter how much more money you give to business owners, businesses are not going to hire any more employees until they have a REASON to – and that reason is customers coming in the door.
OK, That was bold and italicized. Maybe if I make it ALL CAPS the geniuses will see it? Let’s see: BUSINESSES ARE NOT GOING TO HIRE ANY MORE EMPLOYEES UNTIL THEY HAVE A REASON TO AND THAT REASON IS CUSTOMERS COMING IN THE DOOR.
Businesses are not going to hire people just to sit around and listen to iPods or read the paper, waiting for a customer.
Terrance Heath, in America’s Unhappy Anniversary: Ten Years Of The Bush Tax Cuts For The Wealthy,

Republicans claim that preserving the Bush tax cuts for the wealthy is in the interest of small businesses, but small business owners are starting to demand a repeal of the Bush tax cuts.

We are fed by our consumers, not by our tax breaks,” says Rick Poore, owner of Designwear, Inc., a screen-printing business based in Lincoln, Neb. “If you drive more people to my business, I will hire more people. It’s as simple as that. If you give me a tax break, I’ll just take the wife to the Bahamas.

Businesses are fed by their customers, not by tax cuts. Tax cuts only feed deficits. Customers coming in the door is what causes businesses to hire. In case you missed that: Customers coming in the door is what causes businesses to hire.
Direct Job Creation Is Needed
Until there are more customers businesses are not going to hire. Why should they? So it is up to us (government: We, the People…) to create some customers. The way to do that is to hire people to do some of the things that it is government’s job to do anyway, but government has been putting off because of so many tax cuts.
Fix the infrastructure: Our infrastructure is crumbling. In Obama Should Call Chamber’s Infrastructure Bluff I linked to an Urban Land Institute report on the country’s infrastructure, showing how we are falling behind countries like Brazil, China and India, and to the American Society of Civil Engineers (ASCE) Infrastructure Report Card, that says a $2.2 trillion investment is needed just to bring the country’s infrastructure back up to current standards.
This infrastructure work has to be done no matter what. The longer we delay it the more our country falls behind. It is millions of jobs that need doing at a time when millions need jobs! (And by the way the government can borrow at nearly zero interest rates right now — one more reason to do it now.)
Green jobs: And then there are the green jobs you should be creating. You should be hiring people to retrofit every home and building in the country to be more energy efficient. This pays for itself because we stop sending so much money to the oil-producing countries, stop putting so much carbon in the air, and our economy becomes more efficient. And put more money into alternative energy, too. I mean, jeeze, geniuses, what part of this is hard to get?
Jobs fix deficits: Hiring people to fix up the infrastructure takes them off the unemployment rolls and off the other assistance programs, lowering government spending on those programs. Having those jobs means they are paying taxes again, raising government revenue. And fixing up the infrastructure makes our businesses more competitive again, growing the economy. It’s a no-brainer which should mean even the DC geniuses can figure it out.
Fix Trade
Because of bad trade deals, much of any revival of our economy just means that we send more money out of the country. The trade deficits, especially with China, are also economy deficits. We are not just sending jobs and money out of the country, we are sending our chances of coming out of this economic slump out of the country as well.
And these trade deals pit exploited, underpaid workers in non- or weak democracies against our workers who had been benefiting from the good wages, workers protections and other non-“business friendly” things that democracy brings along with it.
Our trade deals have made our democracy and the resulting high standard of living into a disadvantage. Who were the geniuses that let that happen?
Restore Long-Term Incentives
Tax cuts have cut the incentive for long-term business models. It used to take time to build a fortune, so businesses had to place themselves within healthy communities with good schools, well-maintained infrastructure and solid, well-funded public structures like the court system. Cutting top tax rates changed business models to make more sense “harvesting” those things in a hurry and moving on to the next community with resources to plunder. Low top tax rates encourage quick-buck schemes.
Propose The Right Thing
Propose the right thing and do it publicly, instead of trying to appease a political ideology bent on destroying government. Doing the right thing is also the right thing politically. If the job situation doesn’t get better you’re going to be thrown out of office. So come one, geniuses, get smart and start hiring people to fix up the infrastructure and make the economy more energy efficient.
10 years of Bush tax cuts is enough! Click here to demand your representative supports the Fairness in Taxation Act so the rich contribute their fair share.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Close The Social Security “Cap” Tax Loophole!

Most people don’t know that there is a huge loophole in the Social Security tax. Believe it or not, after $107K income you don’t pay the Social Security tax at all. This loophole is called the “cap.” The “cap” loophole is bigger than the looholes that let big corporations get out of paying their taxes because while not all corporations avoid taxes the “cap” applies to everyone making over $107K. Closing this loophole would fix all of Social Security’s so-called “problems.”
The “Cap”
Working people pay into their Social Security account from every dollar they earn but high-income earners only pay on a fraction of what they earn. Most people don’t make enough to take advantage of this loophole, so they don’t even know about this loophole. But once you reach $106,800 of income you stop paying anything into Social Security.
The Social Security “Problem”
Social Security has built up a huge trust fund of money that people have set aside for their retirement. This trust fund covers everyone’s Social Security benefits well into the future. But under some economic assumptions and with continuing concentration of wealth this trust fund begins to run out, and could be gone by approximately 2037. After 2037 the amount coming in from money people set aside could fall short of the amounts going out, and predictions are that without some changes the amounts paid out could be as much as 25% short. Of course, because of cost-of-living adjustments (COLA), benefit checks will be larger than now, even with this potential 25% cut. But this will be a blow to retired people, and should be avoided.
Proposed Solutions
There are several proposals to solve the problem of this potential cut in benefits in the year 2037. Many of these solutions involve schemes to cut benefits now, instead of in 2037, to avoid having to cut in 2037. But for some reason many people are skeptical and do not see the logic of making big cuts in Social Security now in order to avoid possible small cuts later.
Other solutions involve raising the retirement age beyond the current retirement age of 67. People who do not sit at desks in their jobs and have to stand, lift, bend or use their hands worry that they will be unable to work until they die, and would rather see a solution to fixing the problem of a potential shortfall way off in the future than making them continue to work. Also, longevity studies show that people in higher incomes — the very people receiving the “cap” loophole — are living longer but not people who make less.
Still other solutions involve “means testing” — excluding some people from receiving benefits everyone has paid for. This is undemocratic — we are all in this together and have an equal stake and are entitled to equal benefits. That is what the word “entitlement” means: in a democracy we are all equally entitled to certain things.
These proposals all involve cutting or delaying benefits for recipients. But there is another solution that does not involve benefits: raising the cap on the level of earnings that pay into Social Security.
Raise The Cap
The one solution that is seemingly off the table in plutocratic circles is called “raising the cap.” This means fixing the loophole that lets people making over $106,800 stop paying into the Social Security fund. This would, of course, solve the problem of any potential shortfall in Social Security and could even enable restoring a lower retirement age, which would help alleviate the chronic unemployment problem as well.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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NY-26 Lesson: Don’t Mess With Medicare — Or Social Security!

In 2010 Republicans and corporate front groups ran ad after ad after ad after ad claiming that Democrats had “Cut 500 billion from Medicare.” Those ads brought them the senior vote, and they took the House. Confident in their ability to “create their own reality” they came out with a plan to privatize Medicare and told the public it would save Medicare. Well, last night’s win by Kathy Hochul in the NY-26 special election — with pretty high turnout in a Republican district — shows that the American people are smarter than they look, and figured out what was what. The lesson: don’t mess with Medicare.
Soundly Defeated
Yesterday’s NY-26 Congressional election turned on Medicare and the candidate who supported Medicare won. The candidate who supported the Republican plan to privatize Medicare was soundly defeated.
House Republicans voted to change Medicare from a single-payer plan to a private-insurance voucher plan as a measure to “cut government spending.” Republicans had talked themselves into believing the public hates government as much as they do and therefore gutting it is what the public wants. Instead of working to control health care costs they just shifted those costs away from the government into “personal responsibility” land. In plain non-propagandized English personal responsibility means each of us on our own, alone, instead of all of us watching out for and taking care of each other.
The public figured it out and voted to keep the Medicare-gutter out.
American Majority
The American Majority understands what is going on. They know that our budget problems come from tax cuts, military spending and the lack of jobs. Those are the things the public wants the Congress to fix.
Where the deficits come from:

What the public wants:

Gallup Poll, January 14-16, 2011

  • 64% oppose spending cuts to Medicare.

The Wall Street Journal/NBC News Poll, February 24-28, 2011

  • 54% believe it will not be necessary to cut spending on Medicare to reduce the national deficit.
  • 76% believe cutting Medicare to help reduce the budget deficit is mostly or totally unacceptable.
  • 60% oppose turning the Medicare system into a government-issued voucher program, which would require the beneficiary to purchase private health insurance.

First Focus and Greenberg Quinlan Rosner Research Poll, April 13-18, 2011

  • 70% oppose cuts/changes to the Medicare system as described in the House Republican Budget.
  • 49% support not reducing funds to Medicare.
  • 53% believe replacing the current Medicare program with a voucher system in which retirees will receive vouchers to use to purchase subsidized insurance from private insurance companies for those 55 or older is totally or mostly unacceptable.

CBS News/The New York Times Poll, April 15-20, 2011

  • 61% believe that Medicare is currently “worth the costs.”
  • 76% think government has the responsibility to provide health care coverage to the elderly.
  • 49% believe higher-income beneficiaries should pay more in taxes.

Bloomberg News Poll, March 4-7, 2011

  • 54% oppose replacing Medicare with a system in which government vouchers would help participants pay for their own health insurance.
  • 76% oppose reducing benefits for Medicare.

Pulse Opinion Research for The Hill Poll, April 28, 2011

  • 53% said they would oppose a reduction in Medicare benefits in order to get the deficit/debt under control.

Pew Research Poll, March 8-14, 2011

  • 65% oppose changes to Social Security as a way to reduce the budget deficit.

More recent polling shows the public has moved to an even strong support for Medicare, and will remove from office anyone who votes to cut it.
Social Security The Same
Those polls don’t just test public support for Medicare, they test support for Social Security as well. The public feels just as strongly that politicians had best keep their hands off our Social Security.

In order to reduce the national debt, would you support or oppose cutting spending on Social Security, which is the retirement program for the elderly?
Ohio: 16% support, 80% oppose
Missouri: 17% support, 76% oppose
Montana: 20% support, 76% oppose
Minnesota: 23% support, 72% oppose

Reality Restored
During the Bush years the idea of a “reality-based community” circulated after an article by Ron Suskind about a meeting he had with “a senior advisor to Bush.” In the article he described how the aide scoffed at people who bother with reality:

The aide said that guys like me were “in what we call the reality-based community,” which he defined as people who “believe that solutions emerge from your judicious study of discernible reality.” … “That’s not the way the world really works anymore,” he continued. “We’re an empire now, and when we act, we create our own reality. And while you’re studying that reality—judiciously, as you will—we’ll act again, creating other new realities, which you can study too, and that’s how things will sort out. We’re history’s actors…and you, all of you, will be left to just study what we do.”

Republicans and their corporate money tried to create a reality that let them gut Medicare without the public rising up to do something about it. It didn’t work.
Do The Right Thing
Well, reality is coming back. The public is figuring things out. Politicians should learn the lesson of NY-26: don’t mess with Medicare — or Social Security. To fix the deficit fix the causes of the deficit: invest in jobs through maintaining and modernizing our infrastructure, restore top tax rates to where they were before we had huge deficits and, by the way, the Soviet Union is long gone so cut military spending back to maybe only twice our nearest potential competitor.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Social Security “Cannot Exist” Says Rep. Cantor, House Majority Leader

From Campaign for America’s Future:
Help Fight Cantor’s Quest to Eliminate Social Security

Last week, House Majority Leader Eric Cantor said out loud what he really thinks: He believes Social Security “cannot exist.” At all. For anyone.
This week NPR played Cantor’s remarks to the conservative Hoover Institution: He declared: “So we’ve got to protect today’s seniors. But for the rest of us? For – you know, listen. We’re going to have to come to grips with the fact that these programs cannot exist if we want America to be what we want America to be.”
These guys say things like this at right-wing think tanks, expecting that the folks back home won’t hear them. We want to make sure every person in Rep. Cantor’s congressional district hears those words straight from his mouth.
The Campaign for America’s Future isn’t letting Rep. Cantor get away with it. We have a TV ad that will let his constituents know about his extreme opposition to Social Security. But we need your help to get it on the air. The more you can donate, the more we can get his constituents to see the ad and the more we can spread the truth, and put him on the hot seat.
Click here to help us keep this ad on the air »

Here is what CAF sent out in an email:

Help us expose Rep. Eric Cantor’s plan to make sure Social Security “cannot exist.” Contribute $10, $25 or $50 to our ad campaign.
This week NPR played Cantor’s remarks to the conservative Hoover Institution: He declared: “So we’ve got to protect today’s seniors. But for the rest of us? For – you know, listen. We’re going to have to come to grips with the fact that these programs cannot exist if we want America to be what we want America to be.”
These guys say things like this at right-wing think tanks, expecting that the folks back home won’t hear them. We want to make sure every person in Rep. Cantor’s congressional district hears those words straight from his mouth.
Check out our hard-hitting ad. Then help us get it on the air.
Help us expose Rep. Eric Cantor’s plan to make sure Social Security “cannot exist.” Contribute $10, $25 or $50 to our ad campaign.
A significant ad buy in Rep. Cantor’s central Virginia district would only require 100 supporters to donate $50 each.
But the more you can donate, the more we can get his constituents to see the ad and the more we can spread the truth, and put him on the hot seat.
Help us expose Rep. Eric Cantor’s plan to make sure Social Security “cannot exist.” Contribute $10, $25 or $50 to our ad campaign.
All year, the Campaign for America’s Future has been leading the fight to protect Social Security. And our polling shows that big majorities across the country want to strengthen Social Security – including in Cantor’s district.
We helped stop the President from embracing disastrous Social Security cuts in his State of the Union address. Now, let’s make sure the Republicans know what they’re in for if they try to abolish one of American’s most successful, and most popular programs.
Thank you for all of your support.
Sincerely,
Roger Hickey, Co-director
Campaign for America’s Future

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Call Today To Save Social Security

Call Congress on Tuesday and Wednesday!
Senate Majority Leader Harry Reid led a press conference and rally to save Social Security yesterday:

Senate Majority Leader Reid, Other Democrats, Join Hundreds to Demand No Cuts to Social Security
Sens. Reid, Harkin, Sanders, Franken and Blumenthal Follow Emotional Speeches by Americans Who Depend on Social Security and Oppose Cuts
… Under the slogans “Back Off Social Security” and “Hands Off Social Security,” more than 350 fired-up retirees and others packed a meeting room on Capitol Hill to hear from the Senators and program beneficiaries, and to demand no benefit cuts, no retirement age increase, and no privatization. The large public event happened as the battle heats up in Washington between those wanting to sacrifice Social Security as part of a deficit-reduction deal and those demanding that it not be cut.

The following is from the Strengthen Social Security coalition, of which Campaign for America’s Future is part:
We need you to call your Senators and demand that they vote for the Sanders/Reid Social Security Protection Amendment.
Senator Sanders and Majority Leader Reid are leading the fight in the Senate to protect Social Security from drastic cuts.
Their amendment simply says:
Social Security benefits for current and future beneficiaries should not be cut and Social Security should not be privatized as part of any legislation to reduce the Federal deficit.
Call your Senators RIGHT NOW at 1-866-251-4044. You’ll be given a choice of which of your state’s two senators to be connected with. Call BOTH if you have the time. It only takes a minute each.
Tell the person who answers the phone:

  • I am a voter/constituent living in [your state]. I am calling to tell the Senator:
  • I oppose all cuts to Social Security and
  • I urge them to vote yes on the Sanders/Reid Social Security Protection Amendment.

Please take the time for this very important effort today. This is for all of us who depend on Social Security.
Call Today: 1-866-251-4044.
AFTER YOU CALL:
Stay involved, the threat to Social Security continues. Please click to stay involved in the fight.

It’s A Really Bad Time to Be Middle Class

It’s a really bad time to even be middle class in this country, and forget about being poor. The only way to be protected is to be very wealthy: then you are guaranteed that your house is safe, your medical care is covered, and your children will have a future. It’s that bad, and not one bit of this is subtle.
There is a class war underway in this country. The rich, or those that represent their interests, and corporations want control. Dave Johnson, blogger for the Campaign for America’s Future, nailed it when he wrote that: “This budget fight is about a stark choice: jobs and growth for We, the People, or going down the road of plutocracy — rule by the super-rich and big corporations — with little or nothing left over for the rest of us.”
This is the power grab of our generation playing out in Obama’s budget. It reflects true entitlement for the super wealthy. The government revitalization of the “too big to fail” banks was only the tipping point. Of course, the bankers deserved their bonuses. Remember that you heard it here. The battleground is not about the so-called entitlement programs espoused by the Democrats. Social Security, and other such programs are not the culprits; they are the scapegoat for the real agenda.
Obama is being forced to rip open the social fabric of this country to reduce the Bush generated debts. In the President’s proposed budget, most social programs will be ravaged left and right (no pun intended). Yes admittedly, this budget is a massive jobs creation machine. But watch out – don’t get sick folks or have an on-the-job accident because there will little if any safety net. Certainly, we all know about health care reform, yet if Speaker Boehner and his boys have their way — that too will be reduced to a hill of beans and severely compromised. The fight for survival of the middle class and the poor has been ratcheted up a notch. Strap in folks, this is class warfare.
Note, this will also appear in the Huffington Post.

“Gut Or Shut” — Is America Ready?

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
Republicans are saying they are going to either gut the government or shut it down. They mean it. It’s gut or shut, and they are not going to allow a third choice. This is not just posturing and they are not likely to engage in bipartisan bargaining. Their rhetoric has painted them into a corner with their base. We should take them at their word and prepare.
On TV Sunday Lindsey Graham, a supposedly “centrist” US senator said he is willing to let the United States default on its Treasury obligations, saying,

“I will not vote for the debt ceiling increase until I see a plan in place that will deal with our long term debt obligations starting with Social Security, a real bipartisan effort to make sure that Social Security stays solvent, adjusting the age, looking at means tests for benefits. On the spending side I’m not going to vote for a debt ceiling increase unless we go back to 2008 spending levels, cutting discretionary spending…”

Sen. Graham said the threat to destroy the economy unless Social Security is cut is “a great opportunity to change the course of America’s future.” Yet there is little widespread shock or outrage or calls for his resignation from the so-called “responsible” leaders among the D.C. elites. So it appears that willingness to destroy the economy of the country and the world to score an ideological victory has moved into the realm of acceptability. This tells us how much our politics has changed in recent years.
One after another Republicans — the very people responsible for the massive debt — have been outlining their “conditions” for a vote to prevent default and allow the country’s economy to survive. They maintain they are not going to pass a budget that does not gut the government, and if the Senate and President do not go along with this they will just let the government default. They say they “can’t want” for a “bloodbath.” Senator Jim DeMint, for example, said today,

“We need to have a showdown at this point that we are not going to increase our debt ceiling anymore,” he said. “We are going to cut things necessary to stay within the current levels, which is over $14 trillion. This needs to be a big showdown.”

This “gut or shut” threat is so far beyond anything the country has experienced that the country really has no idea what is about to happen in the next few months. But this is just the next step in a 30-year plan and we should understand it that way.
The Huge Debt Was The Plan
The huge deficit and accumulated debt was intentional. It was the plan all along: cut taxes on the rich, grow the debt into an emergency and then use that emergency to force cuts in things our government does for We, the People. Do not forget this and do not let the country forget this, either. This is not an emergency, it is just the next step in their plan.
Making this very point, President George W Bush called his deficits “incredibly positive news” because the resulting debt would force a debt crisis. And he left behind a $1.4 trillion deficit in his last budget year to clinch the deal. Now Republicans are gloating that they can gut or shut the government with the debt ceiling vote. This is not an emergency, it is just the next step in their plan.
It Is About WHAT To Cut
The huge debt was caused by tax cuts for the rich and military spending increases. But those are not what the Republicans are talking about fixing in the name of cutting the deficit. Far from it.
When they say they are “cutting spending” what they mean is they are cutting the things that government does for US – for We, the People. They are keeping the things that government does for the wealthiest 1% – the ones who got the bailouts and tax cuts. They are not talking about cutting the military even though we spend more than all other countries combined. They are not talking about cutting subsidies for big corporations – especially not for oil and coal companies. They are not talking about restoring top tax rates to where they were when the economy (more or less) worked.
They are talking about gutting the things that we do for each other and that protect us from the power of predatory corporate wealth – consumer protections, worker safety, environmental protections, health care, retirement, and the rest.
The Social Security Trap
It appears form Senator Graham’s remarks, and others, that the #1 target is Social Security. While conservatives have had the program in their sights since its inception, today’s focus on Social Security is also a trap aimed at the 2012 Presidential election.
Republican leadership are trying to trap President Obama into agreeing to cut Social Security and then use this to drive him from office. They plan to campaign that Obama cut Social Security, just as they successfully campaigned that “Democrats cut $500 billion from Medicare” in the 2010 midterms. In the 2010 campaign anonymous-donor organizations aligned with the Republican Party ran ad after ad after ad after ad in district after district after district claiming “Democrats cut $500 billion from Medicare.” Seniors abandoned the Democratic party, and Republicans swept the election.
The Public Does Not Want Social Security Touched
This Social Security trap is one pillar of the 2012 plan, and the White House and party leadership should pay attention. Poll after poll after poll warn that the public does not want Social Security touched. Even Tea Party rank-and-file do not want Social Security touched.
Wall Street’s Central Role
Wall Street is also at risk in this game, and should pressure the Republicans to stop threatening to let the country default on its debts. Economist Dean Baker, in Saving Social Security: Stopping Obama’s Next Bad Deal, points out that Wall Street would be destroyed by a debt default, while the rest of us wold survive. For this reason the President should call the bluff.

The prospect of the U.S. government defaulting on its debt creates the sort of end of the world scenario in which Congress rushed to pass the TARP in 2008. Back then … luminaries told members of Congress and the public that we would have a second Great Depression if the Wall Street banks were not immediately bailed out, no questions asked. And the money flowed.
The prospect of defaulting on the debt will create a similar outbreak of shrill warnings of disaster. … privatization of Social Security and Medicare and major cuts and/or elimination of other important programs. The argument from the administration will be that they have no choice.
[…] not only Democrats, but also independents and even Tea Party Republicans overwhelming support Social Security and Medicare. Furthermore, the gun, in the form of a potential debt default, is actually pointed at the Wall Street banks, not the public.
… the day after the default, the country would still have the same capital stock and infrastructure, the same skilled labor force and the same technical knowledge as it did the day before the default.
One thing that would not be around the day after a default is Wall Street. The default would wipe out the value the assets of the Wall Street banks…
For this reason, the threat of a default is a gun pointed most directly at Wall Street. Given the power of Wall Street over Congress, is inconceivable that they would ever let the Republicans pull the trigger.
This means that if President Obama is prepared to take the right and popular position of supporting Social Security and Medicare, he will win. This is both good policy and great politics.

Guy Saperstein, in The Looming Debt Ceiling Shakedown, writes that the President should call the bluff,

The Republicans are running a total bluff. They don’t want the government to default on government bonds anymore than Obama. It would cause economic chaos, cost Wall Street trillions and lead to a civil war within the Republican Party between the Wall Street Wing and the Lunatic [aka, Tea Party] Wing …

Wall Street is supporting the Republicans because they want a weaker, more controllable government — and a piece of that Social Security money. They are convinced that President Obama will cave and agree to gut government and Social Security. But, as Baker points out, this game of default threats puts Wall Street at greater risk than the rest of us. President Obama should use that to draw a line in the sand: He won’t sign anything other than a clean debt ceiling bill. Gutting Social Security should never be discussed as a budget-cutting strategy, and especially not at the barrel of a gun. Back off, send a clean bill, and then let’s talk about all the corporate sacred cows that members of both political parties have been protecting, that long ago needed to be weaned from the federal teat, as well as the unnecessary spending on defense and wasteful tax giveaways. And at the same time, let’s embrace the common sense that only in a growing economy that pays its workers well can we ever hope to repair the damage done by reckless conservative policies.
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Don’t Pass Tax Cuts For The Rich And Then Tell Me About Deficits

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
Congress passed tax cuts for the rich and cut the estate tax way down, adding $800 billion to the deficit and placing Social Security on the chopping block. No one will have predicted what’s coming next year in the name of deficit reduction: they are going after Social Security and everything else that benefits the middle class, and will hold the full faith and credit of our country hostage to get that. Choice: Gut the programs or kill the country. Action: get ready now for the coming fight.
Where We’ve Been
The Congress passed tax cuts for the rich and a huge cut in the estate tax at a time of worries about deficits and intense concentration of wealth. This act just puts the name on what has occurred since Reagan: it formalizes the collapse of We, the People democracy, replaced by plutocracy. And that was with the big Democratic majorities that we all worked so hard to elect. Next year is when it starts getting bad. Action: get ready now for the coming fight.
Here is my message to Republicans: Tax cuts for the rich were so important to you that you took the country hostage, you refused to help the unemployed, you obstructed everything to get them. You blocked unemployment checks, DADT, the DREAM Act, the START Treaty, everything. So don’t come back to me and complain about deficits, and say you need to cut the budget.
My message to the President and Democrats: Rewarding obstruction just makes things worse. You caved on, well, everything in the last two years. You pre-negotiated away things the country needs, only to have Republicans respond by increasing their demands, and then you caved on that. They filibustered something like 420 bills, not to mention judges and appointees, and you only brought the cots out once. So they just did it more. And they will do it more and more, until you stop rewarding them. Action: get ready now for the coming fight.
Worse Fights Coming
There are already signs of the start of the next fight. The big fight is when the debt ceiling has to be raised, and they can hold the country’s and world’s economy hostage to their demands. Before that, though, will be an omnibus spending bill.
Giving in to hostage takers has only solidified this kind of hostage-taking as a successful tactic. For example, last night, even while the House was capitulating to the last hostage-taking, Republicans again used the tactic to kill the omnibus spending bill. Republicans took the spending bill hostage and threatened to shut down the government if Dems didn’t accept their new demands. And Dems again gave in. As TPM puts it today,

Late last night, Harry Reid’s plan to get the federal government funded through the end of the fiscal year went up in flames, burning months and months of work by Senate appropriators and their staffs. To avert a government shutdown, Reid agreed to work out a federal funding plan with Senate Minority Leader Mitch McConnell — Congress will agree to continue funding the government at its current levels through some yet-to-be-determined point next year.
… Next year, though, this arrangement will come back to haunt Dems. … Whatever date they decide will be the deadline for resolving the next spending fight, which will occur in a dramatically different, and more conservative political environment. Republicans will demand spending cuts. And if they’re successful, the stimulative impact of the just-passed tax package will be clawed back.

If they win every time, why would they stop using the tactic? Again and again rewarded for obstruction, Republicans take new hostages. Essentially they say, again and again, “Agree to our demands or we will blow everything up.” Again and again the President and Dems cave. Rinse and repeat.
Action: get ready now for the coming fight.
How Far Will They Take This?
Just how far will they take this? Look at just how far they have taken it. Look what they have already done to the country. As CAF’s Robert Borosage put it in Top End Tax Cuts and a Collapsing Infrastructure

America is literally falling apart. Collapsing bridges, exploding water mains, crumbling levees are a deadly clear and present danger. Children go to schools that are dangerous to their health. Our declining infrastructure is also costly economically, with outmoded transport, crowded highways, slow and inadequate broadband impeding our ability to compete. As President Obama has suggested, we need to make significant investments in building a 21st-century infrastructure, in education and training, in research and development as a foundation for a revived American economy.

The new batch of conservatives is very different from anything this country is used to, and that even includes the conservatives who shut down the government in the 90s, and relentlessly investigated President Clinton and literally anyone who ever knew him. Don’t forget impeachment. They do not care about governing, they care about winning. And they now see absolute obstruction — no matter the cost to the country — as a wining tactic.
People haven’t come to grips yet with what it means when one party can just block everything, and has no interest in governing at all. The corporate right intends to use the debt ceiling and the threat of literally ruining the country to get their way. They will refuse to provide funding for anything they don’t like and threaten to kill the government if they don’t get their way. At risk: Social Security, Medicare, alternative energy programs, infrastructure funding, the Department of Education, certainly NPR, anthing to do with science, reason, civility …
They see this as their moment. They intend to reform the government in their far-right image or destroy it. If you think I am being extreme to say this, watch Fox for a while, listen to their radio shows, read their magazines and blogs. They intend to destroy the government.
Limbaugh: “We won the election, we shut it down.”

Limbaugh was talking about last night’s hostage-taking on the omnibus spending bill, but reflects what I am hearing on the radio and blogs about their attitude in general. They really, really mean it, they see this as their moment to get everything they want or just destroy the government. They don’t really care which.
Former Senator Alan Simpson recently gave a preview of conservative thinking. From Politico,

“I can’t wait for the bloodbath in April,” Simpson said, relishing the prospect of political turmoil. “When debt limit time comes, they’re going to look around and say, ‘What in the hell do we do now? We’ve got guys who will not approve the debt limit extension unless we give ‘em a piece of meat, real meat” in the form of spending cuts.
“And boy, the bloodbath will be extraordinary,” he said.

They want that “bloodbath.” They just can’t wait.
Actions:
First we have to bolster our own leaders, ask them to stop rewarding obstruction and fight for us and let them know you will fight for them if they do. We need an absolute commitment that Social Security will not be touched! Especially now that the just-passed payroll tax cut threatens Social Security’s financing.
Tell The President: Stand Up To The Hostage-Takers! Defend Social Security And Medicare.
Action: get ready now for the coming fight.
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Hidden Agendas Killed The Deficit Commission

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
The National Commission on Fiscal Responsibility and Reform (“Deficit Commission”) was charged with coming up with a plan to reduce the budget deficits and accumulated debt caused by tax cuts for the rich and military spending increases. It was supposed to come up with a bipartisan package that, taken as a whole, would get votes from both sides of the aisle. It was supposed to vote by Dec. 1, and it was only supposed to issue recommendations if they got 14 votes.
It didn’t work out that way. Dec. 1 has passed and the out-of-business commission apparently can’t get the required 14 votes. The commission has failed.
What happened? Two hidden agendas were brought to the table, undermining the commission’s work. Both come from longstanding campaigns by corporate-backed conservatives to undermine trust in, and ultimately defund democratic government. The first was an attack on Social Security. The second was a demand for even more tax cuts for the rich. It is no surprise that these undermined the deficit commission; the well-funded corporate-conservative anti-government agenda now undermines every effort to govern our country, solve our problems and help our people.

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