January 23, 2012

To Get Our Economy Back Hold Cheaters, Fraudsters And Exploiters Accountable

The spiral-to-the-bottom and inequality we are suffering is not an inevitable result of globalization, it is what happens when we don't hold cheaters and exploiters accountable and stop them. This is not just about Wall Street, it is the story of what has happened to our wages and benefits, jobs, factories, companies, industries, economy and democracy in the last 30-or-so years.

Cheaters, Fraudsters and Exploiters

If cheaters and exploiters are not held accountable and fraudsters are not prosecuted, then the advantages this brings them forces honest players out. We're all waiting to see if there is a deal in the works that lets big banksters off the hook for mortgage fraud and other (uninvestigated) crimes, making their shareholders pay fines for them instead. But that story of the 1%'s fraud and cheating and the consequences to the 99% are not what I am writing about here. This post is about how letting 1%er cheaters, fraudsters and exploiters off the hook has hurt America's manufacturing and trade.

Apple Can't Make It Here

Recent news stories about Apple hilight how we allowed our thriving, high-paying manufacturing sector to erode, with the result that our middle class is in decline. Apple used to proudly make their computers in the United States, but now everything is made in Asia. The NY Times' Charles Duhigg and Keith Bradsher, in How the U.S. Lost Out on iPhone Work describe how China's massive government subsidies and exploitation of workers mean “Those jobs aren’t coming back.”

The Entire Supply Chain Is Over There

China has done what it needs to do to bring factories, which bring supply chains, which bring industries. The NYT story describes what it means to have an entire supply chain located where the factories are,

When an Apple team visited, the Chinese plant’s owners were already constructing a new wing. “This is in case you give us the contract,” the manager said, according to a former Apple executive. The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory. It had a warehouse filled with glass samples available to Apple, free of charge. The owners made engineers available at almost no cost. They had built on-site dormitories so employees would be available 24 hours a day.

The Chinese plant got the job.

“The entire supply chain is in China now,” said another former high-ranking Apple executive. “You need a thousand rubber gaskets? That’s the factory next door. You need a million screws? That factory is a block away. You need that screw made a little bit different? It will take three hours.”

Subsidies are often a violation of trade rules. Even so, as the article says, "The Chinese government had agreed to underwrite costs for numerous industries, and those subsidies had trickled down to the glass-cutting factory." So, of course, "the Chinese plant got the job." Meanwhile, our own country has resisted having an "industrial policy" to keep our industries and foster new ones. This is finally changing, but good efforts like "Buy American" and President Obama's green energy policies are fought tooth-and-nail.

Exploited Workers

Another key part of China's advantage is the ability to exploit workers and get away with it -- which lets Apple get away with it, too. And when Apple sees violations, it doesn't stop them.

One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight.

A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.

“The speed and flexibility is breathtaking,” the executive said. “There’s no American plant that can match that.”

Later in the story,

The first truckloads of cut glass arrived at Foxconn City in the dead of night, according to the former Apple executive. That’s when managers woke thousands of workers, who crawled into their uniforms — white and black shirts for men, red for women — and quickly lined up to assemble, by hand, the phones.

... The company disputed some details of the former Apple executive’s account, and wrote that a midnight shift, such as the one described, was impossible “because we have strict regulations regarding the working hours of our employees based on their designated shifts, and every employee has computerized timecards that would bar them from working at any facility at a time outside of their approved shift.” The company said that all shifts began at either 7 a.m. or 7 p.m., and that employees receive at least 12 hours’ notice of any schedule changes.

Foxconn employees, in interviews, have challenged those assertions.

Apple Audits Its Suppliers, Finds Many Violations

Earlier this month Apple released a report describing the practices of its suppliers. NY Times: Apple Lists Its Suppliers for 1st Time,

Apple said audits revealed that 93 supplier facilities had records indicating that over half of workers exceeded a 60-hour weekly working limit. Apple said 108 facilities did not pay proper overtime as required by law. In 15 facilities, Apple found foreign contract workers who had paid excessive recruitment fees to labor agencies.

And though Apple said it mandated changes at those suppliers, and some showed improvements, in aggregate, many types of lapses remained at general levels that have persisted for years.

William K Black, writing in Apple's Foreign Suppliers Demonstrate Widespread Scamming and Horrific Abuse of Employees at AlterNet, looked at Apple's report. Black writes that the audit of suppliers, "shows that anti-employee control fraud is the norm."

Black says that two things stand out in the report,

First, Apple rarely terminates suppliers for defrauding their employees – even when the frauds endanger the lives and health of the workers and the community – and even where Apple knows that the supplier repeatedly lies to Apple about these fraudulent and lethal practices. Second, it appears unlikely in the extreme that Apple makes criminal referrals on its suppliers even when they commit anti-employee control frauds as a routine practice, even when the frauds endanger the worker’s and the public’s health, and even when the supplier repeatedly lies to Apple about the frauds. Apple’s report, therefore, understates substantially the actual incidence of fraud by the 156 suppliers (accounting for 97% of its payments to suppliers).

As Black wrote, "Apple knows that the supplier repeatedly lies to Apple about these fraudulent and lethal practices" and "...it appears unlikely in the extreme that Apple makes criminal referrals on its suppliers" Apple doesn't stop these violations. They get too much of a competitive advantage out of it.

This Is Fraud

When you buy a product you assume that it is on the shelf at the cost you are asked to pay because laws and regulations were followed and standards were met. So you buy the one that has the right quality at the right price. But what if a product has a low cost as the result of cheating, exploitation and violations of environmental, labor and trade laws? What if there is a lie at the root of the transaction you are engaged in?

China's massive investment in capturing entire industries -- a violation of trade laws -- means that many of the components of the high-tech manufacturing supply chain have migrated out of the US to that country. And China's non-democracy political system means that workers have few, if any rights, and often the rights they have are not enforced. Black says American companies taking advantage of this are engaging in "a form of control fraud (fraud in which the head of a company subverts it for personal gain)."

Anti-employee control frauds most commonly fall into four broad, but not mutually exclusive, categories – illegal work conditions due to violation of safety rules, violation of child labor laws, failure to pay employees’ wages and benefits, and frauds based on goods and loans provided by the employer to the employee that lock the employee into quasi-slavery.

Allowing Fraud Drives Legitimate Businesses Out Of Existence

The key point Black makes is that allowing cheating, fraud and exploitation to continue brings them advantages that drive legitimate businesses out,

George Akerlof, in his famous article on markets for “lemons” (largely describing anti-customer control fraud), explained the perverse “Gresham’s” dynamic in 1970: "[D]ishonest dealings tend to drive honest dealings out of the market. The cost of dishonesty, therefore, lies not only in the amount by which the purchaser is cheated; the cost also must include the loss incurred from driving legitimate business out of existence.”

A Criminogenic Environment

Specifically, what this means to companies that try to compete with companies like Apple,

Anti-employee control fraud creates real economic profits for the firm and can massively increase the controlling officers’ wealth. Honest firm normally cannot compete with anti-employee control frauds, so bad ethics drives good ethics out of the markets. Companies like Apple and its counterparts create this criminogenic environment by selecting least-cost – criminal – suppliers who offer components at prices that honest firms cannot match. Effectively, they hang out a sign – only the fraudulent need apply to be suppliers

When we let companies get away with building products in places that violate trade rules, allow environmental degradation, exploit workers, cut corners on safety, use cheap components and ingredients, these companies get cost advantages that force honest companies out of business. This is the story of our economy. This is why our middle class is engaged in a race to the bottom.

Should Companies Like This Exist In The US?

Robwert Cruickshank puts two and two together, in a must-read post, Thinking Differently About Apple and 21st Century Society. He writes,

In the last year or two, it’s become increasingly clear that the way Apple makes its products is deeply flawed. Working conditions at the factory which makes most of their products – Foxconn in Shenzhen, China – are so appalling that workers engaged in a rash of suicides in 2010 to ameliorate their own suffering. Earlier this year workers threatened mass suicide over pay and working conditions. And of course, there’s the fact that Apple makes these products overseas rather than in the United States, where unemployment remains at some of the highest levels we’ve seen since the Great Depression.

Cruickshank asks if companies with this attitude should be allowed to continue to do business? He writes that Apple has,

...a narrow focus on their products and their profits, and disdain wider concerns for the good of society. When an unnamed Apple executive was asked about their role in addressing America’s economic problems, their response was revealing:

They say Apple’s success has benefited the economy by empowering entrepreneurs and creating jobs at companies like cellular providers and businesses shipping Apple products. And, ultimately, they say curing unemployment is not their job.

“We sell iPhones in over a hundred countries,” a current Apple executive said. “We don’t have an obligation to solve America’s problems. Our only obligation is making the best product possible.”

That quote is perhaps the best encapsulation of the pathologies of the modern American corporation. In fact, Apple does have an obligation to solve America’s problems. Everyone who lives in this country has that obligation. And corporations have that obligation too. If they don’t want to help make things better, then they shouldn’t exist.

Then he gets to the wider point,

The notion that companies exist only to generate profit or build a specific few set of products is corrosive. Those profits and products serve the rest of society. And as a part of that society, companies and their executives exist to make that society a better place. If they are engaged in a set of practices that make society worse off, then those actions are indefensible and need to be changed.

For the last 30 years, American businesses have been devoted to a single-minded pursuit of maximizing short-term profits. Unsurprisingly, this has had profound ripple effects throughout the rest of society. The economy became focused on those profits, and so with it followed politics, culture, and our values as a civilization.

By now it should be clear to everybody that while this works well for the small elite that has hoarded all these profits – the so-called “1%” – it has utterly failed to provide a happy and fulfilled life for everyone else.

Here I quote Cruickshank quoting Black, who is looking at Apple's report of its suppliers, with "overwork and other forms of employment fraud being rampant."

As William K. Black explains at Alternet, this is a good example of what may be a widespread tolerance for fraud in the global economy:

These frauds take place abroad, but they harm employees at home. Mitt Romney explains that Bain had to slash wages and pensions to save firms located in the U.S. who had to meet competition from foreign anti-employee control frauds. The damage from foreign anti-employee control frauds drives the domestic attack on U.S. manufacturing wages. Bad ethics increasingly drive good ethics out of the markets and manufacturing jobs out of the U.S. and into more fraud-friendly nations.

"These Frauds Take Place Abroad But They Harm Employees At Home"

Once again, for emphasis, "these frauds take place abroad, but they harm employees at home."

If we want the downward slide to stop we have to decide to hold the cheaters, exploiters and fraudsters accountable for their actions. At home the efforts by the giant corporations to keep the National Labor Relations Board (NLRB) and the Consumer Financial Protection Bureau (CFPB) from doing their jobs, enforcing the rules and holding them accountable further show how this is affecting us all. Abroad we have to demand enforcement of labor and trade rules so companies like Apple can not gain advantages that put more ethical and honest companies out of business. We certainly should not be letting products made there have cost advantages here and stiff tariffs can fix that. Letting companies get away with this makes democracy a competitive disadvantage.

We have to get mad and hold the cheaters, fraudsters and exploiters accountable.

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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Posted by Dave Johnson at 2:43 PM | Comments (0) | Link Cosmos

January 6, 2012

Questions For 2012

There are so many unanswered questions and contradictions all around us. But like the families of alcoholics in denial we stay quiet and try not to rock the boat. Here are some questions that need to be asked, and maybe 2012 can be the year we start demanding answers.

1) Who is our economy for, anyway?
2) Why did we invade Iraq?
3) Why haven’t we broken up those too-big banks yet? Instead they just get bigger and more powerful.
3a) How long will we continue to let the banks "extend and pretend?"
4) Why do we still let tobacco companies kill more than 400,000 Americans every year?
4a) Why don't we make tobacco companies pay to clean up all those cigarette butts everywhere?
5) Wouldn't lowering the Social Security age fix a lot of unemployment and help a lot of people?
6) Is moving a factory to a low-wage country really "trade?" Seriously?
7) If our government is supposed to be of, by and for "We, the People," what do conservatives mean by demanding "less government?"
8) How come we never, ever see someone from a union on the big TV networks talking about the benefits of being in a union or how and why to organize one?
9) Since we didn't have big deficits before the Reagan tax cuts, and since the Bush tax cuts didn't create any jobs ... ???
10) Why haven't there been any criminal prosecutions of Wall Street banksters? (OK, some people are starting to ask that one a lot.)

So Many More

There are so many more questions like those. I guess that's enough for now. We as a country have to start asking questions again and demanding answers. Hey, that reminds me:

11) When will our mainstream "journalists" start asking questions and demanding answers again, instead of just saying things like "both sides do it" and "if one side says the earth is flat and the other side says it is round, that means that the earth must be oval-shaped"?

Wall Street got bailouts, the rich got tax cuts, people got job loss and wage cuts and longer hours, protests got crackdowns and it's getting too obvious to ignore. It's time to stop ignoring things and do something about them.

Please, ask your questions in the comments, and then take them out in public and ask them and keep asking them until you get answers. It's your right to ask, and your right to demand answers.

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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Posted by Dave Johnson at 7:19 AM | Comments (0) | Link Cosmos

November 18, 2011

5 Privatization Nightmares

Here is a piece I did exclusively for AlterNet -- go check it out: Privatization Nightmare: 5 Public Services That Should Never Be Handed Over to Greedy Corporations | Economy | AlterNet,

Who gains – and who loses – when public assets and jobs are turned over to the private sector?

Posted by Dave Johnson at 7:36 AM | Comments (0) | Link Cosmos

November 15, 2011

Government Shutdowns Get The 1% What They Want

A while back I was writing about the Republican threat of a government-wide shutdown, and the two-week Federal Aviation Administration shutdown (and Delta Airlines' anti-union role in that). The shutdown threat was used to force the government to give even more favors and bucks to the 1% and even less to We, the People.

Guess what? The shutdown threats are back.

Last Time

Earlier this year, and then again in September, the Republicans threatened to block the budget from passing and to just let the government shut down. In exchange for allowing the government to continue to operate they wanted favors for the 1% and their corporations, including gutting environmental regulations, gutting healthcare (especially women's healthcare), and generally gutting the things We, the People do for each other.

They largely got their way. They even shut down the FAA, stopping construction projects in an attempt to gut union organizing. Four thousand FAA workers and about 90,000 construction workers were laid off, and the shutdown cost the government about $30 million a day.

Which Was Which?

The Republican threat of shutting down the government is not to be confused with the debt-ceiling hostage-taking debacle that was engineered by Republicans.

The debt-ceiling hostage-taking involved Republicans threatening to let the government default on its obligations, sending the world's economy into a tailspin, unless We, the People dramatically roll back the things we do for each other. They got their way, resulting in big cuts plus the "super committee" of the 1% that is currently working on cutting things for the 99%. (The secretive committee is actually talking about cutting Medicare and cutting top tax rates, and calling it "pro-growth.")

FAA And Labor

In August Republicans shut down the FAA for two weeks, with Republicans trying to get in an anti-union rule. A temporary FAA reauthorization is currently funded only until the end of January. Last week Rep. John Mica, chairman of the House Transportation and Infrastructure Committee, predicted that the FAA “reauthorization” bill would be done, passed and signed by Christmas.

But the anti-labor provision is still in the bill.

Former Transportation Secretary Norman Mineta said the fights over funding bills like this could "make a grown man cry." According to The Hill, "We're working on the 20th-plus extension" of the FAA bill, Mineta said during an interview with The Hill. "That's something we really have to get resolved, and [with] a long-term bill."

The Game Is Squeeze-The-Rubes

Here is how the squeeze-the-rubes game is played.

First, cut taxes for the rich. To accomplish this, call it "pro-growth," make the claim that these cuts will "boost the economy" for the rubes, "bring them jobs," or basically whatever they need to hear that week to get them to go along. Then borrow a ton of money to make up for the lost revenue, because when the debt comes due you have serious leverage.

Meanwhile, cut government, cut back on education for the rubes, health care for the rubes -- they don't need it, what are they going to do with educations and health, anyway? Cut regulation. Cut enforcement. And, most of all, do what you can to hamstring labor because organized labor is the one remaining force in the country that has some power, and is working to maintain the middle class. because with a strong middle class, government is able to pay down the debt, so there is no cover for all the cuts.

Then, to speed things up, boost the government's spending on the things that increase your wealth and power. The big one is military. Find something to scare the rubes, watch them run and hide and squeal and let you crank up the military budget, give yourselves no-bid contracts, lucrative consulting contracts, even send pallets of cash to be disbursed to you and your friends.

And, by the way, tax subsidies for your oil and finance companies will drain the treasury pretty fast, too.

Then, when the bill comes due, that's when the hammer comes down. That's when you spring the trap. That's when you can have real fun. You've got them where you want them, and you can go to work. Scare the bejeezus out of them with stories of insolvency, poverty, whatever it takes to make them fear the debt. And then crank up the demands.

Congress Plays Along

Members of Congress see this game of squeeze-the-rubes for what it is, and get what they can for themselves, too. Rep. Mica, chairman of the House Transportation and Infrastructure Committee, led the two-week FAA shutdown over that anti-union rule. (See The Hostage-Taking Just Keeps Coming - This Time The FAA Shuts Down, Think Default Threat Is A Yawn? The FAA Is Still Shut Down and Delta's Greed Helps Shut Down The FAA)

Well, according to the Florida Independent, Mica, just months after being involved in the temporary shutdown over “spending” on the FAA was bragging about an FAA grant awarded to his district. Mica said he worked for a provision in that bill to keep unions from being able to organize “said he had used his vote as a ‘bargaining tool’ to gain the support of Senate Democrats” for the grant to his own district.

P.S. Take a look at where Rep. Mica gets the money to run his campaigns.

How The Game Is Played

Watch Jack Abramoff explain in a 60 Minutes segment how it works Once the member of Congress or staffer thinks they might get a lobbying job from you,

ABRAMOFF: When we would become friendly with an office and they were important to us, and the chief of staff was a competent person, I would say or my staff would say to him or her at some point, “You know, when you’re done working on the Hill, we’d very much like you to consider coming to work for us.” Now the moment I said that to them or any of our staff said that to ‘em, that was it. We owned them. And what does that mean? Every request from our office, every request of our clients, everything that we want, they’re gonna do. And not only that, they’re gonna think of things we can’t think of to do.

Perks, Too

Are airlines giving perks to members of Congress and staffers, as they prepare to vote on more favors for the 1%, possible shutdowns of government for the rest of us, even the FAA reauthorization? From Roll Call, Being in Congress Has Perks,

Most major airlines have phones lines dedicated to customers on Capitol Hill, aides and lobbyists told Roll Call. To accommodate their unpredictable travel schedules, Members are allowed to reserve seats on multiple flights but pay only for the one they board.

A spokesman for Delta confirmed the airline has a Congressional call desk and allows members to double-book flights. United Continental Holdings Inc., US Airways and American Airlines, all of which are rumored to have similar practices, did not return Roll Call’s request for comment.

“We get on every single flight,” said one Capitol Hill aide familiar with process. “Every offices uses it. ... The scheduler uses it for Members and chiefs of staff who fly.”

The perks have long raised the ire of consumer advocates. “They are treated completely differently from the time they book their ticket until the time they land at the airport,” said Kate Hanni, director of Flyers Rights, an airline passenger advocacy organization.

Short Run Good For 1%, Long Run Bad For 99%

In the short run this game yields great riches to a few. In the long run, of course, getting rid of government defunds infrastructure and education so the economy eventually slows to a crawl. Pitting the parts of the citizenry against each other breeds social chaos, maybe even violence.

What do they care, when they can just hop in their own jots and fly to their own private islands?

Government is us: We, the People. Our government of the people, by the people and for the people exists to reign in the1% and act as a counterweight to the power of their wealth and their huge corporations. That is why We, the People formed our government, to counter the corrupt controlling power of the British King and his aristocracy. That is why we enabled organized labor. That is why we have regulations. That is why we have access to courts to sue giant corporations. It is about one-person-one-vote democracy, not one-dollar-one-vote plutocracy.

What You Can Do

Tell Delta: Stop The Union Busting,

Delta Air Lines is holding billions of dollars in funding for crucial FAA projects hostage by insisting that Congress pass new, undemocratic rules for airline workers trying to organize a union. Delta wants union elections to count workers who don't take part as voting "No"--an absurd demand that would undermine the entire system of majority-rule voting.

The rules are under debate now, Delta's powerful allies in Congress are holding up a long-term solution by continuing to insist on the new election rule.

Without a long-term reauthorization bill, job-creating airport infrastructure projects and critical security improvements are on hold. And we run the risk of another FAA shutdown at the end of the year.

Thursday National Day Of Action

Many organizations are calling for a national day of action Thursday Nov. 17, with various events around the country.

Follow the Twitter hashtag #N17 for info.

Occupy Wall Street, on Thursday's Day Of Action

Interfaith Worker Justice: National Days of Action Against Wage Theft

Check out this We Are The 99% event Thursday,

We're starting to get the 1% to pay attention. But this system's still rigged against us: Wall Street is still making billions and taking our homes, and Congress can't pass a jobs bill. To amplify the economic emergency, we're making Thursday, November 17, a massive day of action to show "We Are The 99%.

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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Posted by Dave Johnson at 9:01 AM | Comments (0) | Link Cosmos

October 26, 2011

People Distrust Government -- Conservative Mission Accomplished

The corporate/conservative plan for decades has been to turn people against government and democracy. Because when people stop accepting the idea of We, the People making decisions, guess who gets to make the decisions instead? Last month a retiring GOP staffer explained how it works, this month a new poll show how well it works.

Distrust

NY Times today: New Poll Finds a Deep Distrust of Government,

Not only do 89 percent of Americans say they distrust government to do the right thing, but 74 percent say the country is on the wrong track and 84 percent disapprove of Congress — warnings for Democrats and Republicans alike.

... A remarkable sense of pessimism and skepticism was apparent in question after question in the survey, which found that Congressional approval has reached a new low at 9 percent.

The Gameplan

At the beginning of September a Republican Senate staffer retired, and wrote a widely-read "confession" that laid bare the conservative gameplan: turn people against government and democracy. In Goodbye to All That: Reflections of a GOP Operative Who Left the Cult, retiring Republican Congressional staffer Mike Lofgren wrote,

Far from being a rarity, virtually every bill, every nominee for Senate confirmation and every routine procedural motion is now subject to a Republican filibuster. Under the circumstances, it is no wonder that Washington is gridlocked: legislating has now become war minus the shooting, something one could have observed 80 years ago in the Reichstag of the Weimar Republic. As Hannah Arendt observed, a disciplined minority of totalitarians can use the instruments of democratic government to undermine democracy itself.

[. . .] A couple of years ago, a Republican committee staff director told me candidly (and proudly) what the method was to all this obstruction and disruption. Should Republicans succeed in obstructing the Senate from doing its job, it would further lower Congress's generic favorability rating among the American people. By sabotaging the reputation of an institution of government, the party that is programmatically against government would come out the relative winner.

A deeply cynical tactic, to be sure, but a psychologically insightful one that plays on the weaknesses both of the voting public and the news media. There are tens of millions of low-information voters who hardly know which party controls which branch of government, let alone which party is pursuing a particular legislative tactic. These voters' confusion over who did what allows them to form the conclusion that "they are all crooks," and that "government is no good," further leading them to think, "a plague on both your houses" and "the parties are like two kids in a school yard." This ill-informed public cynicism, in its turn, further intensifies the long-term decline in public trust in government that has been taking place since the early 1960s - a distrust that has been stoked by Republican rhetoric at every turn ("Government is the problem," declared Ronald Reagan in 1980).

Please read the whole piece. This Republican, writing from the inside, explains that they are doing it on purpose. They are making the government dysfunctional on purpose. They are making people hate government on purpose. They are working to turn people against democracy and put themselves and their corporate sponsors in power in its place.

#occupy Brings Signs Of Hope

There are signs of hope in the poll. Even with a dearth of media coverage (compare to the well-funded, billionaire-backed Tea Party!!!) the #occupywallstreet movement has changed the national conversation. From the NYTimes article,

Almost half of the public thinks the sentiment at the root of the Occupy movement generally reflects the views of most Americans.

With nearly all Americans remaining fearful that the economy is stagnating or deteriorating further, two-thirds of the public said that wealth should be distributed more evenly in the country. Seven in 10 Americans think the policies of Congressional Republicans favor the rich. Two-thirds object to tax cuts for corporations and a similar number prefer increasing income taxes on millionaires.

[. . .] With the nation’s unemployment rate at 9.1 percent, income inequality remains a palpable issue for Americans. Nearly 9 in 10 Democrats, two-thirds of independents and just over one-third of all Republicans say that the distribution of wealth in the country should be more equitable, even as a majority of Republicans said they think it is fair.

There is hope. The public is not stupid, and can at least sense what is going on.

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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Posted by Dave Johnson at 1:08 PM | Comments (0) | Link Cosmos

August 19, 2011

Mr President, Don’t Cut Them Slack When They Threaten Us And Our Economy

Republican Presidential candidate Rick Perry, threatening Federal Reserve Chair Ben Bernanke, over his efforts to boost the economy:

“If this guy prints more money between now and the election, I dunno what y’all would do to him in Iowa but we would treat him pretty ugly down in Texas. Printing more money to play politics at this particular time in history is almost treasonous in my opinion.”

Perry believes that efforts to help the economy are "politics" because helping the economy helps President Obama in the coming election. Perry’s comments brought into the open the Republican mindset about the economy: They want it to tank – and are working to tank it – because they believe a poor economy will help them in the coming election. They see helping the economy as "politics" that help Obama.

Hostage-Taking And Intimidation

Republicans recently threatened to take the country into default, which brought about the "credit-rating downgrade" from Standard & Poors. The result of this hostage-taking was an economy-killing deal to take trillions of dollars out of the economy, immediately sending the stock market and economic indicators like consumer confidence into a dive. Republicans previously used hostage-taking to keep tax cuts for the wealthy, thereby dramatically increasing deficits and economy-killing income/wealth disparity. Then they used hostage-taking threats to "shut down the government" to force economy-killing cuts in services to regular people.

Time after time Republicans are obstructing, delaying, bullying, doing whatever they can to keep the economy from recovering. Hostage-taking, intimidation, bullying tactics, and they are not even above use of physical threats to get their way.

JFK Assassinated In Texas

This flyer was circulating around Dallas in the days before Kennedy's assassination:

Governor Perry threatened Fed Chair Ben Bernanke’s safety, using language echoing 60s-era accusations against President John F. Kennedy. A person who could be the next President accusing a public official of the death-penalty crime of "treason" is about as serious as it gets. On top of that, it is not easy to forget what this kind of talk means in Texas. President Kennedy was accused of "treason," too, and Texas treated him “ugly” in November, 1963. There is no possibility that a Governor of the state of Texas is not very aware that this event occurred there, and of the political climate in Texas at the time it occurred, and of what saying to a high federal official that "we would treat him pretty ugly down in Texas" necessarily brings to mind.

Cut Him Slack?

In response to Perry's threat against Bernanke, President Obama said he will "cut him some slack."

"Mr. Perry just got into the presidential race. I think that everybody who runs for president, it probably takes them a little bit of time before they start realizing that this isn't like running for governor or running for senator or running for Congress, and you've got to be a little more careful about what you say," Obama responded.

"But I'll cut him some slack. He's only been at it for a few days now," he said.

Cut him slack for threatening the Chairman of the Federal Reserve? Cut him slack for saying that efforts to get our economy going are "treason?"

Mr. President, you were elected by We, the People to empower and protect us. You have a duty to take on those who threaten us, and threaten our livelihoods and prosperity and wish to harm our government. You owe it to us to be tough in the face of intimidation and hostage-taking.

Mr. President, do not "cut them some slack" when they threaten us and take hostages! Confront them head on, shame them, call them out for these actions. If you "cut them some slack" the bullies will continue to do these things again and again, as they have been doing for some time. You owe it to us, to We, the People, to put a stop to this and we gave you the power to do that.

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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Posted by Dave Johnson at 3:56 PM | Comments (0) | Link Cosmos

August 9, 2011

Ten Years Ago We Were Paying Off The Nation's Debt. But Then We Elected Obama.

Just ten years ago this country was running huge surpluses and paying off its debt. But then we elected Obama and all hell broke loose. Oh, wait...

Something Happened

Between the time ten years ago when we had big surpluses and were paying off the debt and now when we are told the "Obama spending and deficit" mean we have to cut back on the things We, the People do for each other, something happened. Something changed. The things that happened, the things that changed, are being ignored in the current DC discussion about what we need to do to fix things.

Separation From Reality

This DC/Tea Party argument over deficits and the Reagan/Bush debt is completely separated from facts and history. And it is completely separated from what the public wants. There are things that we are supposed to just not remember and which seem to be taboo in the national media. There are things that are "off the table" for discussion, and certainly for solving our problems.

But here is some reality anyway, even if we're not supposed to see it. Just ten years ago we were paying off debt at a rate that would have completely paid it all off by now. But under George W. Bush we cut taxes for the rich and more than doubled military spending. We deregulated and stopped enforcing laws. We let the big corporations run rampant. Our federal budget turned from huge surpluses to massive deficits, and Bush said it was "incredibly positive news" because it would lead to a debt crisis they could use to shock people into letting the corporate right privatize and thereby profit.

And then, under and because of Bush, our economy collapsed.

Deficits From Tax Cuts And Military Spending

Once again: the deficits are the direct result of tax cuts for the rich, and huge increases in military spending. Then that huge jump in already-large deficits up past the trillion-dollar level that occurred in Bush's last budget was the result of the Bush-caused financial collapse. The economy collapsed and the government stepped in with hundreds of billions, even trillions, to rescue the wealthy, with "bailouts," while doing little, even cutting back, on what our government does for We, the People. That all happened in Bush's last budget year, not Obama's first.

To Fix The Damage, Undo The Cause

The way to fix deficits is to undo the damage Bush did, by raising taxes on the rich, and cutting back the huge, bloated, extreme, massive, astonishing, incredible, stratospheric military budget. And we have to boost the economy by investing in rebuilding our infrastructure to get people employed. We have millions of jobs that need doing, while millions are looking for jobs. Then those people will be paying taxes instead of collecting unemployment and food stamps. And the infrastructure improvements will bosst our economy's competitiveness. This is all so simple and obvious that only DC insider types could miss it.

Taxes And Spending = Democracy

Cutting spending doesn't cut the need, it shifts the burden. Cutting government spending does not cut the costs to society and the overall economy of meeting those needs. Cutting government spending just shifts -- or privatizes -- those costs onto the backs of people who can't afford to spend that money. That need and cost is still there in the economy, except without government -- democracy -- handling it, doing it for all of us, less expensively. Cutting government's role opens those functions up to private profit, instead of We, the People taking care of and watching out for each other -- and making the decisions.

Do you really think that if you phase out Medicare, that old people won't still need the medical care? Of course they will still need it, but the government won't be negotiating cost-savings for them, they'll be on their own, up against the giant insurance monopolies.

In the 1950s the top tax rate was 90%, and the country's economy worked a lot better for a lot more of us. We didn't have big deficits. We certainly weren't piling up huge debt. With high tax rates at the top, predatory, sell-the-farm business models didn't make sense. We were investing in infrastructure, and that infrastructure made us competitive in world markets. We as a people were doing better every year, paying our bills, getting educated and becoming more civilized. This empowerment led to demands for equal rights for all of us.

Ignored By Media

The "both sides do it" major media is simply ignoring the majority of the public. But people aren't fooled. Poll after poll (did I already say that?) shows that the public "gets it." Poll after poll shows that the public wants our government to address jobs, not deficits, to restore top tax rates, to invest in America's infrastructure, to leave Social Security and Medicare alone (or increase them,) and to put more money into education. Poll after poll.

The Public Wants Jobs

The public gets it. Poll after poll shows that Americans want their government focused on jobs, not deficits. The latest, from CNN, taken August 5-7, shows 49% of Americans think unemployment is the biggest issue facing the country, while only 27% say deficits. Only 16% say the deficit is the country's biggest problem.

Rebuild The Dream

The The American Dream Movement is rolling out their Contract for the American Dream. The Tea-Party-fascinated press is largely ignoring this, but this movement represents the majority of the public, and can't be ignored for long. I'll be writing more about it later.

Also the Take Back the American Dream conference is coming up on Oct. 3. Click through and learn more.

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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Posted by Dave Johnson at 11:00 AM | Comments (0) | Link Cosmos

July 30, 2011

Golden Oldie: Did Bush Leave Us Bankrupt, Corrupt, Ungovernable?

Feb. 2010: Did Bush Leave Us Bankrupt, Corrupt, Ungovernable?

When you sell the farm, the farm's gone.

Is it already too late for America? I’m starting to think that the anti-tax, anti-government conservative movement that started in the mid-70s, elected Reagan and led to the terrible Bush Presidency may have effectively destroyed the country, leaving it bankrupt, corrupt,ungovernable, ruled by a wealthy elite -- and we're only now just starting to realize it. To cover tax cuts we stopped maintaining the infrastructure and started borrowing. To satisfy their hatred of government we increasingly stripped away rule of law, regulation, and belief in one-person-one-vote. We are seeing the consequences of all of that coming back to roost now.

Reagan left us with massive debt and ever-increasing interest payments. Bush left us with $1.3 trillion deficits and a destroyed economy that would force further increases in the borrowing for years - to be blamed on Obama. The "free marketers" gave away our manufacturing base that will take decades and massive capital investment to recover. Obama can try, but it may just be too late to do anything about the borrowing. We need massive investment in jobs and infrastructure, and a national economic/industrial plan. But, with their own Reagan/Bush debt as ammunition, conservative ideologues continue to block every effort at investment to get out of the mess we are in.

And with the country on the very edge of defaulting on the Reagan/Bush debt, Senate Republicans are FILIBUSTERING the very debt-ceiling deal they were for just a few weeks ago...

There is much more at that old post, go read.

Posted by Dave Johnson at 12:15 PM | Comments (0) | Link Cosmos

July 25, 2011

A Bipartisan Move Against Democracy

Step back from the day-to-day, hour-to-hour details of the debt-ceiling negotiations for a minute and look at the bigger picture. Look what we're in the middle of. Our legislators are being stampeded by a manufactured "crisis" into profoundly changing the nature of our country and who our economy is "for," on extremely short notice, against the clear wishes of the majority of the public. They are doing so without following the long-established process for due consideration of important issues; they are not holding hearings, not giving time for public input, not going through committees... The act of negotiating with these hostage-takers at all is itself a violation of our established, democratic system. The question to ask is not, "What painful cuts should we agree to to save our country," but rather, "Why are we engaged in this anti-democracy exercise at all?"

A Functioning Democracy?

In a functioning democracy an informed public considers and debates its options and then comes to a decision on how best to proceed. In a representative republic our representatives are called "representatives" because they represent us, and vote to implement our wishes.

The founding idea of our country is that We, the People are in charge, and our country exists to promote the common good -- "welfare" -- of all of us. Elected officials take an oath of office to protect and defend our Constitution, which begins with those words, "We, the People." Over time we have built up a system of institutions, processes, procedures, traditions and mechanisms to implement this founding idea. The oath they take is to protect and defend this system.

Oath Of Office: Protect and Defend Our System

Today all of this seems all to have fallen away from us. A fanatical but extremely well-funded minority is using a manufactured "crisis" to hold the country's economy hostage. As ransom -- if we don't want the country to go into default, destroying our economy -- they demand that we force fast and dramatic changes to the nature of our country and our social safety net. These changes will take effect before the public can react and gather the forces of opposition. They will be "locked in," creating "facts on the ground" that we have to deal with, and which are extremenly difficult to undo, no matter what We, the People want or need.

Rather than honor their oath of office to protect and defend our We-the-People system from all enemies, foreign and domestic, and to listen to "We, the People," and to promote the common good of all of us, our leaders have instead entered into negotiations with the hostage-takers. The act of entering into these negotiations is by itself an agreement to work outside of our established system, and the result of these negotiations will be to change the equation of who our system is for.

Crisis?

Is there really a "debt crisis" necessitating such a dramatic and immediate response? Just 10 years ago the "crisis" we faced was that we were paying off the debt too fast and it was claimed this would lead to socialism as government surpluses were invested in private assets. So taxes for the wealthy were cut. At the same time, enabled by another "crisis," the military budget was dramatically increased -- in ways that enriched "private contractors."

The result of these changes was an immediate return from budget surpluses to the dramatic budget deficits initiated by President Reagan. Then-President Bush called these deficits "Incredibly positive news" precisely because they would bring on a debt crisis that would enable today's stampede to change our system of government. The debt "crisis" was intentional.

Cause Of Deficits and Debt

The increase of deficits beyond $1 trillion occurred in President Bush's last budget year -- the consequence of the financial collapse and the resulting drop in tax revenue combined with increases in social safety-net program payments. But the underlying cause of the deficits was the Bush tax cuts and wars. Today, in How the Deficit Got This Big, the NY Times offers charts and figures that show that:

...under Mr. Bush, tax cuts and war spending were the biggest policy drivers of the swing from projected surpluses to deficits from 2002 to 2009. Budget estimates that didn’t foresee the recessions in 2001 and in 2008 and 2009 also contributed to deficits. Mr. Obama’s policies, taken out to 2017, add to deficits, but not by nearly as much.

As for the causes of the longer-term debt picture The Center on Budget and Policy Priorities has put together this chart, explaining:

Longer term most of our country's future debt problem is from tax cuts, increases in military spending, and the effects of the economic downturn. Most of the rest is because of our private healthcare delivery system. These "debt-ceiling" negotiations are not addressing these causes of the problem at all. Instead they are about using whipped-up panic over those intentionally-created problems to move the common wealth into private hands.

Not The First Time

This tactic of whipping up panic over a "debt crisis" has been used before to stampede legislative bodies into making radical changes on short notice, moving common wealth into private hands. In the post Debt Crisis? Really? I hilighted a 1993 example from Canada that was very similar to today's. From the source's account,

By the time Canadians learned that the “deficit crisis” had been grossly manipulated by the corporate-funded think tanks, it hardly mattered – the budget cuts had already been made and locked in. As a direct result, social programs for the country’s unemployed were radically eroded and have never recovered, despite many subsequent surplus budgets.

There is example after of example of the use of manufactured "crises" to panic and stampede legislatures into privatizing public wealth, just as we are experiencing today.

Democracy Eroded

What is happening here is not supposed to be the process of decision-making used in a representative democracy. Instead what we are experiencing is designed specifically to engineer circumstances that persuade us to bypass established processes and safeguards. These safeguards are in place to protect us from making the very sort of panic-driven decisions that we are about to make. And they are designed to "lock in" the changes, so we can't reverse the damage when we are able to catch our breath.

How can our leaders not recognize and resist what is being done here? Have our own leaders drifted so far from America's traditional love of democracy that they accept this and fall into playing the game?

Elitist Mindset

It seems that our own leaders have fallen into an elitist mindset, which enables them to go along. Persuaded by decades of corporate-funded propaganda, many now believe that the public doesn't know what is good for them, that the things democracy entitles them to -- "entitlements" -- will bankrupt the country, that taxing the wealthy and corporations -- the "job creators" -- will harm the economy. They do not seem to see how much of our wealth is now flowing to a very few at the top of the pyramid. The fact that taxes on the wealthiest have been cut from a top rate of 90% all the way to a rate of only 15% for hedge-fund managers making billions -- far lower than many of the rest of us pay -- is ignored. And the fact that we did not have budget deficits when the wealthy paid higher taxes is also ignored. In fact, today just 400 people now have more wealth than half of our population, and the trend is accelerating. But many of our leaders believe that the things We, the People do for each other are a problem, and we must be protected from ourselves.

One example of the slow drift away from love of democracy is the recent "Deficit Commission." This was a commission of elites -- there were no teachers or unemployed or plumbers or disabled or poor people in that room -- that was assigned to come up with ways to lower our budget deficits. They did not come up with any recommendations, but the leaders of the commissions came up with a plan of their own -- to cut taxes on the wealthy while cutting the things that We, the People do for each other.

Again and again our elites try to create bodies like this that act as an external force they have to submit to, allowing them to escape accountability to voters.

These commissions come up with plans that benefit the wealthy few but violate what the vast majority of Americans want. They are designed to come up with recommendations that benefit the wealthy few, and are presented to Congress with "up-or-down-vote" procedures that leave legislators and voters with no recourse – on purpose. Pre-ordained conclusions with non-democratic force-through procedures.

"Super Congress"

Another example of this kind of anti-democratic, elitist drift was a proposal floated over the weekend to establish a "Super-Congress" -- a Politburo of elites, that sits above the Congress and is not accountable to the public. The idea is to save the people from themselves by creating a special 12-member panel of lawmakers who come up with proposals that the Congress must vote on, with no changes and an "up-or-down vote" to implement, thus bypassing the established, democratic system and keeping individual members from being held accountable for the results. The idea is to "tie the hands" of Congress, keep them from meddling, and get things done quickly before the public can rally opposition.

That this idea was even floated shows the extend of separation that exists between our elected officials and We, the People.

Public Will Revolt

Regular Americans are not currently following this, and are turned out because it is just one more Chicken Little coming out of DC. But the public will revolt when the final decisions are put in front of them. The public overwhelmingly supports Social Security and Medicare, and overwhelmingly want taxes increased on the wealthy.

So when the results are presented to them there will be trouble. And that is also part of the plan.

In the 2010 election Republicans campaigned on a theme that "Democrats cut $500 billion from Medicare" and won the election. In 2012 the public will be presented with hundreds of millions of dollars spent on campaign ads, crying out that "Democrats cut your Social Security and Medicare, while keeping taxes low for the rich."

Think I’m kidding? They have already started.

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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Posted by Dave Johnson at 2:14 PM | Comments (0) | Link Cosmos

July 21, 2011

Government Spending Cuts Don’t Cut, They Shift Costs To US

The conservatives are following up on their decades-old plan to use tax cuts to create terrible deficits, and then use the resulting "debt crisis" to cut government. But cutting government doesn't mean the costs go away, it means that we each have to bear those costs ourselves, on our own, without the help of the rest of us. This is really about cutting democracy so the very rich can be even very-richer.

A Huge Tax Increase On Regular People

A government budget cut is like a huge tax increase on regular people because it increases what each of us pays for the things government does -- or forces us to go without. This is because cuts in government spending don’t actually cut the cost of things, they just shift those costs onto each of us on our own.

For example, if you cut the the government's Medicare or Medicaid budget our health problems don’t disappear, but each of us has to find ways to pay the cost of medical care or a nursing home on our own. If you cut what government spends for maintaining infrastructure, the roads/bridges/dams/schools/etc. deteriorate and we all pay for that through a less competitive economy, car-repair costs, and sometimes with our lives. And when each of us has to pay more for these things, it really does take money out of the economy. We're spending on those things, instead of more usefully contributing to the economy.

Cuts Just Shift And Increase The Costs

So spending cuts really just shift the spending and cost of the things we have to do – and often increase those costs. This is because doing things on our own instead of collectively through our government is the smallest possible economy-of-scale. The best example of this shift-and-increase effect is the Republican plan to phase out Medicare. As I wrote above, our health problems won’t disappear just because government cuts out Medicare. But the costs of treating – or not treating – those health problems is now on us, individually, instead of aggregated through the mechanism of democracy. And that is money that would otherwise be spent elsewhere in the economy.

In Cost of Medicare Equivalent Insurance Skyrockets under Ryan Plan the Center for Economic and Policy Research (CEPR) explains what happens to the cost of health care if Medicare is eliminated. Summary: it shifts the costs to us, except each of us ends up paying seven times as much as the same care costs under Medicare. This is because Medicare covers millions, and that economy-of-scale means the government can negotiate bulk discounts, etc. that we cannot get on our own. From the CEPR explanation:

[The Republican] plan to revamp Medicare has been described as shifting costs from the government to beneficiaries. A new report from the Center for Economic and Policy Research (CEPR), however, shows that the [Republican] proposal will increase health care costs for seniors by more than seven dollars for every dollar it saves the government, a point missing from much of the debate over the plan.

... In addition to comparing the costs of Medicare to the government under the current system and under the [Republican] plan, the authors also show the effects of raising the age of Medicare eligibility. The paper also demonstrates that while [the Republicanplan ] shifts $4.9 trillion in health care costs from the government to Medicare beneficiaries, this number is dwarfed by a $34 trillion increase in overall costs to beneficiaries that is projected ...

The Mechanism Of Democracy

In other words, the Repubican plan to phase out Medicare would cost the economy seven times as much as it cuts government. In this case the mechanism of democracy works seven times better than doing the same thing on our own. The economy of scale introduced by democracy -- We, the People gathering together to watch out for and take care of each other -- saves the economy sevenfold on costs. And that is money that would be spent by each of us but now goes just to cover the healthcare costs. This is one more reason why democracies are more prosperous for regular people than other forms of government that leave people on their own against the wealthy and powerful and drive all of the income and wealth to a few at the top.

Budget Cuts Deals Hurt Us And The Economy

When you hear that the "debt-ceiling" deal being negotiated in Washington is going to cut $4 trillion from the government's budget it doesn’t mean that $4 trillion is is going to be saved and put into the economy, it means the opposite, and worse. It means that $4 trillion in costs will be shifted from the mechanism of democracy and onto our backs, each of us, on our own. And that means that the total costs of accomplishing the same things will go up. And that means each of us will have less to spend in the economy. Think about what that will do to jobs.

• As government health care is cut each of us will take on those costs on our own, and will be paying up to seven times what the same care would have cost.

• As infrastructure maintenance and modernization is cut, our economy will become less competitive, unemployment will increase and our wages and spending power will fall.

• As spending on education is cut, our costs of educating ourselves and our kids will increase. College costs will soar.

• As environmental regulation and enforcement is cut the costs of the resulting health problems and cleanups will increase.

• As enforcement of labor laws is cut, our wages and protections will fall.

• As etc. is cut, the costs of etc. are shifted to each of us, on our own, and the total costs of accomplishing etc. actually increase.
  

This Is About Democracy

In the bigger picture budget cuts are about shifting away from the mechanism of democracy -- where We, the People aggregate and cover these costs in a more effective way -- and instead moving costs to each of us on-our-own. And because of the effect of reduced economies-of-scale we then each face a much greater cost-per-person than if we did these things through the mechanism of democracy. This hurts our economy.

Don't be fooled: this is really about shifting from democracy to a system where we are on our own, up against the wealthy and powerful. This is about shifting from a system where we can all be prosperous to a system where a few have all the wealth and power.

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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Posted by Dave Johnson at 11:08 AM | Comments (0) | Link Cosmos

June 24, 2011

How Free Trade Made Democracy A Disadvantage

This is my presentation from last week's Netroots Nation panel session: Revitalizing Manufacturing: The Road to Renewed Job Growth. Click through for panel details and other panelists, here for a pdf of slides, including Jared Bernstein's. See below for video -- and be sure to watch Beri Fox!!!

Four Stories

I want to share four quick stories:

1. Democracy

The story of America

We fought a wealthy powerful few who had all the say and didn’t let us have a say, and made a country where We, the People made the decisions and share the benefits.

So because we had a say we built up a country with good schools, good infrastructure, good courts, and we made rules that said workers had to be safe, get a minimum wage… we protect the environment, we give out social security. We take care of each other.

And we used to protect that. We used to put a tariff on goods coming in if they were made by people who didn’t have the ability to speak up and better their condition. It was called the American System. Look it up. We’d let the goods in but we would use a tariff to strengthen our country, our infrastructure, our schools – our democracy.

But that changed. Superman left and we stopped protecting the American Way. We started letting goods in made by people who had no say, so the goods were cheap and they undercut us.

We have made democracy a disadvantage. We made it a disadvantage instead of an advantage.

Make no mistake, people who say they want things more “business friendly” they mean they want America to be less of a democracy, with fewer of the protections we fought to build for ourselves.

2. Trade

Once upon a time some areas made some things well, and other areas made other things well, and they would trade, and both areas could have the things they made AND the things made somewhere else, and everyone benefitted. And both areas increased the customers they had.

And so to most people “trade” means we buy things made somewhere else, and they buy things we make. In what world does “trade” mean closing a factory that is located here, moving it there where they don’t already make something, laying off all the people, and then bringing back here the same things that used to be made here and selling them in the same stores?

And the result is a lot of people have lost jobs, devastating our communities.

And then they tell workers who still have jobs that the same can happen to them, we can just close this factory, so shut up and don’t expect raises or benefits or safety or dignity.

What we see happening when a company moves production out of the country is not trade, it is getting around the borders of the democracy we built, and the things we fought and sacrificed to build.

Letting companies move factories away was giving up our ability to make a living. Sure a few people might get really rich from it, but look around you the rest of us, and our communities, and our economy have been sent sliding down a hill into the sewer.

3. The Deal

There once was a company. The company made a deal with a company in the next county, they make something you don’t, and you make something they don’t. So the deal is you’ll buy things from them if they buy from you. And you start buying from them, but they aren’t buying from you. And this goes on, and they still aren’t buying from you, but you are starting to owe them a lot of money. And they you’re borrowing from them to buy from them, and they still aren’t buying. And then they show up in your county selling the things you already made and sold, buy they used the money they got selling to you to set up to make what you made.

And by the way they say you have to pay them what you owe them.

That is how our deal with China is working out. We bought from them, they didn’t buy form us, and now they have accumulated $1.5 trillion which they were supposed to have been buying American-made goods with.

And they cheated. Or I would say they were smart and watched out for their own interests excessively, and we didn’t at all.

$1.5 trillion! So imagine what would happen if we said we're going to default on the debt but these bonds are redeemable in the next 3 months for American made good. Can you imagine what $1.5 trillion of orders would do for our economy right now? $1.5 trillion in orders? Factories humming...

Well the picture of what that would do FOR our economy is a way of understanding what that has done TO our economy.

4. The Cost

I like to tell you a story about the cost of our free-trade deals and tax policies.

I took a road trip last fall, through four industrial states, MI, OH, WV, PA to visit some of the Manufacturing Town Hall meetings that Scott’s group put on. [Note - see posts about this tour here.]

They call it the "rust belt" because so many factories are closed and rusting.

From town to town you see downtowns devastated, because the way you make a living is gone and the cheap imported goods at wal mart competing with local businesses. Michael Moore wrote about Flint after the auto plants closed. That kept happening, town after town, year after year, and got worse.

You have to see to first hand. [Note - there are pics in this post.]

But I’ll tell you, we’re even seeing it now in Silicon Valley, seeing downtowns with lots of empty storefronts. Empty office and manufacturing buildings everywhere. That wave that hit the Midwest has reached the tech areas now.

So the moral of the four stories is that We the People have to protect the things we fought for and won. And we have to remember that We, the People have to take care of and watch out for each other because the wealthy and powerful won’t do that for us. And markets aren’t about that, either.

When we relax our eternal vigilance they will come back with a vengeance.

Progressive Solutions

a. Industrial Policy

We don’t believe in having the government help. We think the markets will fix everything. But other countries don’t see it that way.
We are pitting our companies on their own against the national resources of governments. We can live in an ideological dream world and say we shouldn’t, but our competitors in the rest of the world DO.

b. Protect Democracy

Tariffs. Call it a democracy tariff. Or a thugocracy tax. Use this to help lift others out of their exploitation. By making democracy a disadvantage we are only encouraging the worst, and encouraging it here, too. “Business friendly” is a code word that means get rid of all the protections We, the People have built for ourselves.

They can protect the environment, etc, or charge a tariff to bring those goods in.

c. Renegotiate Trade Deals

Trade can mean something different. We still have a huge market. We can require goods to either be made by people who are not exploited and who have a say so

d. Enforce Trade Laws

China cheats in so many ways, and we all know it. Currency rates. Indigenous innovation . Forcing companies to turn over proprietary IP…

We can do these things. Because of the strong prosperity that democracy brought us others really want to sell into our markets.

And my own favorite:

e. Top tax rates

With high top rates it takes time to build a fortune. You have to have long-term plans, sustainable businesses that are surrounded by healthy communities, good schools, good infrastructure.

Lower rates, you can make a fortune in a few days. Business models changed, became short term, cash in, quick-buck schemes. Harvest infrastructure, close factories, no need for healthy communities, etc.

Video Of The Panel

Scott Paul opens
Jared Bernstein at 6:02
Rep. Jim McGovern at 17:00
Beri Fox at 31:29
Dave Johnson at 48:13

IF the video below doesn't show up, click to see it here.

Sobotka

As always, Frank Sobotka explains what's wrong:

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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Posted by Dave Johnson at 10:16 AM | Comments (0) | Link Cosmos

June 9, 2011

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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Posted by Dave Johnson at 12:17 PM | Comments (0) | Link Cosmos

May 31, 2011

Dems Should Vote For Clean Debt Limit Bill

The House is voting on a “clean” debt ceiling bill today -- a bill to raise the debt ceiling without any "hostage-taking" conditions. This is the right thing to do for the country and every Democrat should vote for this. Voting for a clean bill will draw the contrast for the public between those who are doing the right thing, and those willing to hold the world's economy hostage to a make-the-rich-richer plutocracy agenda. Democrats who do not vote for a clean bill should lose committee assignments, parking places, even bathroom keys.

The Debt Ceiling

The country's "debt ceiling" has been reached. This means that the government's authority to borrow money has reached its limit. The Treasury Department is engaging in gimmicks and schemes to keep the country going but time is running out. The Congress must extend this limit, or the government will default on its bonds.

If our government defaults on its bonds it would initiate a worldwide financial crisis that dwarfs the Wall Street meltdown of a few years ago.

WHY We Have This Debt

In 1981 the Reagan administration dramatically changed the course of the country. They defunded government by passing huge tax cuts for the rich and massively increasing military spending, and began cutting back on the things We, the People (government) do for each other. The country cut back on maintaining -- never mind modernizing -- our infrastructure, our schools, colleges and universities, scientific research and other things that make us competitive in world markets. We began cashing in our factories and moving the jobs out of the country. As a result of Reagan-era changes our trade deficits soared, wages stagnated, pensions disappeared, and a few extremely wealthy started getting much, much richer.

One major result of these changes, of course, was the huge budget deficits that accumulated into today's massive debt. This was the plan from the start, to "starve the beast" by defunding government and forcing the debt to reach a level where there was no choice but to cut back on democratic government's protections for the people, unleashing plutocracy.

Hostage-Taking Enabled: The Tax Cut Extension

This debate over the debt ceiling and hostage-taking follows the recent extension of the Bush tax cuts -- another product of hostage-taking. At the end of the last Congress unemployment benefits for the millions of unemployed were running out. Republicans -- having filibustered much of the legislation of the prior two years -- held the extension of benefits "hostage" saying they would not let it pass unless the deficit-creating Bush tax cuts were extended.

Enough Democrats caved and passed an extension of the Bush tax cuts. This validated hostage-taking as a successful tactic while making the deficit much worse, setting the stage for today's debt-ceiling fight.

The Vote Is A Trick

Today's vote has been scheduled by the Republican leadership as a trap, trying to get some Democrats to vote with Republicans to support their hostage-taking agenda and create the appearance of bipartisan support for plutocracy. If the Republican position gets the support of enough Democratic members, Republicans can then demand deep cuts in Medicare and other programs that help people and hold corporate power in check, in exchange for their votes to allow the world's economy to continue to operate.

From TPM: First Debt Limit Vote Today As GOP Looks To Divide Dems,

The vote is intended to expose fault lines within the Democratic caucus, with Republicans counting on sizable number of Democrats to side with them and bolster their case that Democrats need to agree to deep spending cuts as a condition to raising the debt limit.

Vote For A Clean Debt-Ceiling Bill

Voting for a clean bill stops government-by-hostage-in its tracks. Voting for a clean bill saves the world's economy. Voting for a clean bill fights the plutocracy agenda. Voting for a clean bill saves Medicare, Social Security and the things We, the People do for each other. Voting for a clean bill is the right thing to do and doing the right thing is the right thing politically.

Call your member of Congress NOW and demand a vote for a clean debt-ceiling bill.

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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Posted by Dave Johnson at 9:27 AM | Comments (0) | Link Cosmos

April 26, 2011

Does Government Know Who The Boss Is?

In Washington state workers are allowed to organize and form unions so they can win good wages and benefits. In "right-to-work" states like South Carolina, though, the government sides with big companies against their workers. (They used to have even harsher anti-worker laws there but the North stopped rounding up the escapees…)

Boeing workers in Washington go on strike, so Boeing sets up an assembly line in anti-union South Carolina and tells the Washington workers to take what they offer and like it. This is a standard move from companies these days, telling workers, “Take the cuts or we’ll close the plant and move your jobs somewhere where workers can’t do anything about it.”

Illegal, But So What?

You probably didn’t know this but retaliating against workers like that is against the law. It is even illegal to threaten workers in order to avoid a strike. It is illegal to fire or intimidate employees for organizing.

But companies go ahead and do these things anyway, and other illegal things, because no one does anything about it. And it has been so long since anyone did anything about it – just like with banking fraud or age discrimination – that it is now standard operating procedure. No one even remembers that it is illegal. No one cares.

Like age discrimination. Look at the faces of the employees behind President Obama when he visited Facebook and tell me if Facebook is the least bit worried about age discrimination enforcement.

Or this picture of the President visiting Google:

Workers' Rights A Thing Of The Past

With labor-law enforcement -- or even a sense that workers should have rights -- seemingly a thing of the past, these anti-worker sentiments are spreading. Recently, for example Arizona and South Dakota passed anti-worker laws, forbidding the formation of a union after a majority workers sign cards asking for one. Wisconsin and other states have passed laws restricting the labor rights of public-employees and restricting the ability to collect union-membership dues.

But THIS Time!

But THIS time something unusual happened. The government has actually threatened to enforce the law! The National Labor Relations Board filed a complaint against Boeing and is suing Arizona and South Dakota for violating labor laws!

Boardrooms across the land are rising up in indignation. How dare the government threaten giant corporations that they might enforce the law? Don’t they know who's the boss? The Wall Street Journal explains, "Boeing management did what it judged to be best for its shareholders and customers and looked elsewhere. ... As Boeing chief Jim McNerney noted on a conference call at the time, the company couldn't have "strikes happening every three to four years." and calls Boeing's threats against unions a "reasonable business decision."

Conservative columnists and bloggers are earning their pay, writing indignant column after column about "union bosses," some even praising Ayn Rand. Conservative astroturfers (also) and politicians are not far behind them.

How dare We, the People (government) tell a business that it has to respect its workers and our laws!!!

Who Is Boss?

Do We, the People have the ability to enforce our laws? Do we have the power to tax corporations and the wealthy?

Do we have the power to protect the protections of democracy?

Democracy provides workers with safety protections and fair wages. We fought so hard to build and maintain this democratic society so that We, the People could share the benefits. We passed laws allowing union organizing, as a balance to the immense power of corporations and wealth. We passed laws prohibiting companies from telling workers, "Work for what we give you or don't eat."

And for a time this built our prosperity. But we let the protections slip, and allowed companies to cross borders to escape the protections democracy offers -- to non-democratic countries like China where workers have few rights, where pay is low, environmental protections practically non-existent. Companies locating manufacturing in places like have huge cost advantages over companies located in democracies that respect and protect the rights of citizens.

The Threat Against Us

Won't companies just move out of the state/country if we try to enforce labor laws or tax them? Won't China just stop selling to us if we apply a tariff to protect democracy, or try to enforce trade laws? Won't the rich just pack up and move or stop working if we don't just give them everything they want? Won't they move even more factories out of the city/state/country if We, the People try to demand our rights?

We Still Have The Power

Here's the thing. We, the People still have some power left in our hands. For one thing we still have a huge market. We still have the power to make demands on those who would like to sell into that market. And we can still choose to enforce tax laws, and wage laws, and tariffs, and labor laws, and trade laws to protect and strengthen what remains of our democracy.

But we can only do this if we decide to stand up for ourselves and do something about what is happening. We have to put our foot down, and demand that our politicians listen to We, the People and do what we say. It is time to get organized, to talk to neighbors and relatives, to show up at town hall meetings and protests. We can demand that news media begin to cover more than just the corporate/conservative viewpoint. We can go out and register others to vote, and get them to the polls, and demand that votes be counted accurately. We can take back our democracy and put We, the People back in charge.

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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Posted by Dave Johnson at 1:44 PM | Comments (0) | Link Cosmos

April 22, 2011

Video: What’s Really Going On With The Deficit

The Best Explanation Of What’s Really Going On With The Deficit | MoveOn.Org

Posted by Dave Johnson at 11:49 AM | Comments (1) | Link Cosmos

April 21, 2011

Congressional Town Halls

The Republicans in the House just voted to privatize Medicare. They voted to cut taxes on the rich. And Social Security is threatened. Here is a list of upcoming Congressional Town Hall meetings. You should show up and let them know how you feel about getting rid of Medicare to pay for tax cuts for the rich:

Elected Official Date City
Sen. Ron Wyden (DEM - OR) 4/23/2011 Brookings
Sen. Ron Wyden (DEM - OR) 4/23/2011 Coos Bay
Rep. Tom Reed (REP - NY) 4/23/2011 Caton
Rep. Tom Reed (REP - NY) 4/23/2011 St. Bonaventure
Rep. Tom Reed (REP - NY) 4/23/2011 Wellsville
Rep. Diane Black (REP - TN) 4/25/2011 Lebanon
Sen. Orrin Hatch (REP - UT) 4/25/2011 Roosevelt
Rep. Bruce Braley (DEM - IA) 4/25/2011 Davenport
Rep. Tom Marino (REP - PA) 4/25/2011 Williamsport
Sen. Ron Wyden (DEM - OR) 4/25/2011 Hood River
Rep. Francisco Canseco (REP - TX) 4/25/2011 Fair Oaks Ranch
Rep. Mo Brooks (REP - AL) 4/25/2011 Florence
Rep. Joe Wilson (REP - SC) 4/25/2011 Lexington
Rep. Tom Cole (REP - OK) 4/26/2011 Norman
Rep. Diane Black (REP - TN) 4/26/2011 Carthage
Rep. Dan Boren (DEM - OK) 4/26/2011 Vinita
Rep. Alan Nunnelee (REP - MS) 4/26/2011 Tupelo
Rep. Tim Huelskamp (REP - KS) 4/26/2011 Clay Center
Rep. Tim Huelskamp (REP - KS) 4/26/2011 Minneapolis
Rep. Steve Pearce (REP - NM) 4/26/2011 Ruidoso
Sen. Charles Grassley (REP - IA) 4/26/2011 State Center
Rep. Rick Berg (REP - ND) 4/26/2011 Bismarck
Rep. Bruce Braley (DEM - IA) 4/26/2011 Cedar Falls
Sen. Orrin Hatch (REP - UT) 4/26/2011 Vernal
Rep. Randy Hultgren (REP - IL) 4/26/2011 Sycamore
Rep. Daniel Webster (REP - FL) 4/26/2011 Orlando
Rep. Francisco Canseco (REP - TX) 4/26/2011 San Antonio
Sen. Ron Wyden (DEM - OR) 4/26/2011 The Dalles
Rep. Kurt Schrader (DEM - OR) 4/26/2011 Milwaukie
Rep. Lou Barletta (REP - PA) 4/26/2011 East Stroudsburg
Rep. Dan Boren (DEM - OK) 4/26/2011 Pryor
Rep. Tom Cole (REP - OK) 4/27/2011 Ada
Rep. Xavier Becerra (DEM - CA) 4/27/2011 Los Angeles
Rep. Mick Mulvaney (REP - SC) 4/27/2011 Rock Hill
Rep. Rick Berg (REP - ND) 4/27/2011 Fargo
Rep. Colleen Hanabusa (DEM - HI) 4/27/2011 Honolulu
Sen. Jerry Moran (REP - KS) 4/27/2011 Horton
Rep. Bruce Braley (DEM - IA) 4/27/2011 Dubuque
Sen. Jerry Moran (REP - KS) 4/27/2011 Centralia
Rep. David Wu (DEM - OR) 4/27/2011 Portland
Sen. Jerry Moran (REP - KS) 4/27/2011 Alma
Rep. Bruce Braley (DEM - IA) 4/27/2011 Fayette
Rep. Charles Bass (REP - NH) 4/27/2011 Colebrook
Rep. Steve Southerland (REP - FL) 4/27/2011 Eastpoint
Rep. Francisco Canseco (REP - TX) 4/27/2011 Castroville
Rep. Francisco Canseco (REP - TX) 4/27/2011 San Antonio
Rep. Ann Marie Buerkle (REP - NY) 4/27/2011 Cato
Sen. Jerry Moran (REP - KS) 4/27/2011 Topeka
Rep. Tom Cole (REP - OK) 4/28/2011 Duncan
Rep. Tom Cole (REP - OK) 4/28/2011 Lawton
Rep. Mick Mulvaney (REP - SC) 4/28/2011 Camden
Rep. Diane Black (REP - TN) 4/28/2011 Cookeville
Rep. Alan Nunnelee (REP - MS) 4/28/2011 Columbus
Rep. Tim Huelskamp (REP - KS) 4/28/2011 Goodland
Rep. Tim Huelskamp (REP - KS) 4/28/2011 Sharon Springs
Rep. Tim Huelskamp (REP - KS) 4/28/2011 Colby
Rep. Steve Pearce (REP - NM) 4/28/2011 Roswell
Rep. Colleen Hanabusa (DEM - HI) 4/28/2011 Honolulu
Rep. David Wu (DEM - OR) 4/28/2011 Newberg
Rep. Joe Wilson (REP - SC) 4/28/2011 Hardeeville
Rep. Randy Hultgren (REP - IL) 4/28/2011 Geneseo
Rep. Steve Southerland (REP - FL) 4/28/2011 Blountstown
Rep. Francisco Canseco (REP - TX) 4/28/2011 San Antonio
Rep. Frank Guinta (REP - NH) 4/28/2011 Exeter
Rep. Russ Carnahan (DEM - MO) 4/28/2011 St. Louis
Rep. Francisco Canseco (REP - TX) 4/29/2011 Hondo
Rep. Rick Berg (REP - ND) 4/29/2011 Grand Forks
Rep. David Wu (DEM - OR) 4/29/2011 Hillsboro
Rep. Tim Huelskamp (REP - KS) 4/29/2011 Cottonwood Falls
Rep. Tim Huelskamp (REP - KS) 4/29/2011 Marion
Rep. Tim Huelskamp (REP - KS) 4/29/2011 Emporia
Rep. Francisco Canseco (REP - TX) 4/30/2011 Uvdale
Rep. Francisco Canseco (REP - TX) 4/30/2011 Del Rio
Rep. David Wu (DEM - OR) 4/30/2011 Astoria
Rep. David Wu (DEM - OR) 4/30/2011 Rainier
Rep. Dan Lungren (REP - CA) 4/30/2011 Angels Camp

Posted by Dave Johnson at 4:16 PM | Comments (0) | Link Cosmos

April 18, 2011

Conservative Tax Tricks – Did Tax Cuts Grow The Economy?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

It's Tax Day, so let's talk about taxes.

Conservative ideology says cutting taxes makes the economy grow. This Tax Day let's explore whether this is, in fact, the case. In the last few decades we as a country have conducted textbook scientific experiments with taxes. Under Reagan we dramatically cut taxes at the top, under Clinton we raised them a bit, and then under Bush we cut them again. So now we can look at what happened: Did cutting taxes make the economy grow?

Science vs Ideology

Science describes, ideology prescribes. The scientist looks at what actually happens and tries to describe it. The ideologue says, "If only people would do so-and-so then such-and-such would happen." (And a unicorn.)

Conservative ideology says, "taxes take money out of the economy," and "people won't work if they are taxed," "businesses will hire more people if their taxes are cut," and "government is standing in the way of job-creation." (And a unicorn.)

Science looks at the effect of tax cuts on growth in the past, and over time. Then policy can realistically be adjusted for the best outcome.

What Actually Happened

Since 1980 we have cut taxes a lot, then raised them, then cut them. Did the cuts result in economic growth, and did increases result in recessions?

Reagan Tax Cuts

Ronald Reagan applied ideology to our government's finances and cut taxes from the then-top rate of 70% down to 50%, and then, later, to 28%. (George HW Bush raised top tax rates to 31%.) The top corporate tax rate was cut in 1987 from 46% to 40% and the next year to 34%. It turned out that if only (and a unicorn) didn't work out so well when it hit the wall of reality. Now We, the People are suffering the consequences.

Conservatives say that the economy boomed, and more revenue came in because of the tax cuts. What actually happened was government deficits and the resulting accumulated debt exploded, while our defunded government has since been unable to maintain the infrastructure and public structures (laws, courts, regulations, protections, schools, etc...) that keep our economy competitive and our standard of living high. All you have to do is look at the record. Let's do that here.

In 1981 -- Carter's last budget year -- the on-budget (not from Social Security) tax receipts were $469 billion which was a 16% increase over the prior year. 1982 tax receipts were $474.3 billion, down to 1.1% over 1981, and the on-budget deficit shot up to $120 billion, a shocking increase of 62% in a single year! 1983 receipts were $453.2 billion, a drop of 4.4%, creating a deficit of $208 BILLION -- an increase of 73%! In just those two years following the tax cuts our debt increased by $328 billion!

Then Tax Increases

A panicked Congress passed the 1984 Deficit Reduction Act, the largest tax increase in our history. (Not so much on the wealthy, of course.) Tax receipts climbed to $500.3 billion, a 10.4% increase, and the deficit shrank almost 11% to $185.6 billion. But this was still very high. So in 1985 Congress passed the Gramm-Rudmann-Hollings Anti-Deficit Act, and in 1985 tax receipts were $548 billion, a 9.5% increase. But by then the huge military spending increases and the interest on the debt were kicking in -- "structural" deficits were established -- and the deficit increased to $221 billion, an increase of 19%. (The "Tax Rates And Growth Over Time" charts below show that economic growth declined.)

When conservatives tell you, "Reagan cut taxes and revenue increased," they don't mention those huge tax increases. Nor do they mention the revenue drop following the tax cuts. The size of the economy increases over time anyway, so there is a natural rate of increase that occurred as well. Saying the Reagan tax cuts increased revenue is like saying you skipped lunch and gained a few pounds, without mentioning the 12-course dinner with three deserts.

Clinton Raised Taxes, Bush Cut Them

In 1993 Bill Clinton fought to raise top tax rates on the wealthy from 31% to 39.6%. Conservatives said the tax increases would destroy the economy and kill job growth. There is an eight-year record showing what actually happened after taxes were raised. Then in 2001 George W Bush cut taxes again and unfortunately there is another 8-year record of the consequences.

A comparison of economic performance under these two-term presidents and their tax policies is as close as we can get to a carefully-structured science experiment. Let's see what happened.

GDP: Clinton vs Bush

(Chart from CAP: Three Good Reasons to Let the High-End Bush Tax Cuts Disappear This Year. Note that the chart period does not include the effect of the financial crisis.)

Jobs: Clinton vs Bush

Real Median Household Income: Clinton vs Bush

(Chart from CAP: Three Good Reasons to Let the High-End Bush Tax Cuts Disappear This Year. Also does not include effect of financial crisis.)

Deficit: Clinton vs Bush

What do these charts tell us?

* Following the Clinton tax increases the economy did much better than it did after the 'W' Bush tax cuts.
* Following the Clinton tax increases job growth did much better than it did after the 'W' Bush tax cuts.
* Following the Clinton tax increases real median household incomes did much better than it did after the 'W' Bush tax cuts.
* Following the Clinton tax increases the deficit went down and eventually the government started paying off its debt. The deficits exploded after the 'W' Bush tax cuts.

The results of the tax experiment show that tax cits didn't improve anything but did cause an impressive increase in debt. And the resulting debt interest payment will be a drag on our economy until something (hint) is done to reverse the cause of the deficits. (Hint, hint.)

Tax Rates And Growth Over Time

The longer-term picture tells the same story. The record shows that in periods of highest taxes the economy grows the most and in periods of low taxes is grows the least. While this does not prove causation, it certainly contradicts conservative claims that high taxes kill growth and jobs, while low taxes boost growth and jobs.

Top tax rates:

Growth over the same period: (12-quarter rolling average nominal GDP growth.)

Trend line of growth, with top tax rates:

Top tax rates and national debt:

Investing In Our Economy Grows Our Economy.

From Tax Cuts Leave Nothing Behind -- Infrastructure Investment Leaves Behind Infrastructure,

If we spend money on tax cuts, the next year we only have debt and pay interest on the debt. ...

A properly functioning democratic government that is not obstructed by ideology invests and regulates and protects and ensures that all businesses get a chance to succeed or fail on their merits, not on lobbying and tax breaks and crony contracts and by crushing smaller businesses. A properly functioning democratic government is able to tax the most wealthy and powerful to help pay for the necessary investment in infrastructure, public structures, education and the rest of the things that keep the economy going into the future.

If we spend money on improving the country's infrastructure, we get all the job creation that comes from that work, and the next year you have that infrastructure there to help drive the economy.

Lowering taxes can provide a short "stimulus" boost while it is consumed, but at the cost of borrowing the money instead of taxing to pay for government, with the resulting long-term drag on the economy from paying the interest on that borrowing. Obviously the same amount of stimulus used for investment in infrastructure, education or direct job creation instead of taxes would have more immediate effect and the resulting payoff usually more than covers the interest. Borrow to invest, not to consume.

Tax cuts don't grow the economy, they grow the debt.

Tax CUTS Take Money Out Of The Economy

From Tax Cuts Are Theft,

A beneficial cycle: We invest in infrastructure and public structures that create the conditions for enterprise to form and prosper. We prepare the ground for business to thrive. When enterprise prospers we share the bounty, with good wages and benefits for the people who work in the businesses and taxes that provide for the general welfare and for reinvestment in the infrastructure and public structures that keep the system going.

Since the Reagan Revolution with its tax cuts for the rich, its anti-government policies, and its deregulation of the big corporations our democracy is increasingly defunded (and that was the plan), infrastructure is crumbling, our schools are falling behind, factories and supply chains are being dismantled, those still at work are working longer hours for fewer benefits and falling wages, our pensions are gone, wealth and income are increasingly concentrating at the very top, our country is declining.

Societal Effects

Beyond the terrible budgetary consequences of tax cuts for the rich we also saw societal consequences. The social contract was broken, the wealthy were no longer asked to pay back society for the opportunity we had provided. Since it no longer took time to build a fortune there was a shift in business models from building long-term, sustainable, customer-supportive businesses to fast-buck, customer-exploiting, job-killing outsourcing, everything-to-the-top schemes. The incentive to reinvest in healthy communities disappeared.

And there is the incredible concentration of income, wealth and power among a top few, and its effect on democracy, the rise of plutocracy, and the destruction of the middle class asthese effects cause job opportunities to fade (click for funny video)...

Again, from Tax Cuts Are Theft,

. . . We must recognize and understand these tax cuts for what they are. They are a broken contract. These tax cuts for the wealthy are theft. And we must recognize the Reagan Revolution for what it has cost us. Our democracy has been corrupted and our political system has been captured. A wealthy few are taking all of the benefits of our efforts for themselves. The lack of investment in infrastructure, courts, schools and other public structures is making our country less competitive in the world. The Reagan Revolution is stealing our future.

It Didn't Work So Do More?

Today ideology still dominates and conservatives are calling for even more tax cuts. In spite of the record, the ideologues still say, "A recession is the wrong time to raise taxes" because "taxes take money out of the economy." Just last week House Republicans passed a budget that cuts rates for the wealthy, which were 90% for decades and then 70% before tax-cut fever brought us the huge deficit, to 25%. And also cuts corporate taxes - 90% of corporate stock is owned by the top 10% - to 25%. They say more tax cuts will "promote growth and job creation." But all we have to do is look at the record to know what will happen if this takes effect.

And A Unicorn plus a candy mountain:

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Posted by Dave Johnson at 2:00 PM | Comments (0) | Link Cosmos

Conservative Tax Tricks – Are We "Broke?"

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Conservatives have been saying lately, "We're broke," and need to cut back on the things we (government) do to protect and empower each other. They have a unique definition of the word "we" when applied this way to Americans. For them "we" doesn't mean "We, the People," it means something different.

In the last few decades conservatives cut taxes on the rich. And then they cut taxes on the rich. And then they cut taxes on the rich. And then they did it even more. Finally, after cutting, cutting and cutting taxes on the rich they complain that there isn't any money to run our government!

Speaker of the House John Boehner, Jan. 26: "Well, if you really want to talk about what the 'Sputnik moment' is," he replied, "it's the fact that we're broke. And American people know we're broke." Again on Feb. 10: "We're broke. Let's be honest with ourselves."

Wisconsin Governor Scott Walker says Wisconsin is "broke," too. (Therefore they have to get rid of unions???)

Conservatives even extend their nonsense to claim California is "broke" because it taxes the rich!

Are We Broke?

If the definition of "we" is "we" then we certainly aren't "broke." In fact just 400 of us have more money than half of the rest of us -- 155 million people. Just 400 people have that much! That's a whole lot of "not broke" right there.

Last year the top 25 hedge fund managers -- just 25 people -- had income of $22 billion. Those 25 people had more income than all the people in 440,000 average American families combined. (Median household incomeaccording to the Census Bureau in 2008 was $52,029.) That's a whole lot of "not broke" right there, too.

And these are just two examples of how extreme the income inequality in our country has gotten. A few at the top have so much at the expense of the rest of us.

Where Did The Money Go?

Those 25 hedge fund managers have been granted a special tax rate of only 15%. Those 400 wealthy people who own more than half of the rest of us get much of their income from "capital gains," dividends and other special low-tax gimmicks. The top few percent of Americans have been getting tax breaks since Reagan, and the result is that the rest of us have to make up the difference. We're not "broke," we're paying for the gains at the top.

Joshua Holland, Tax Day Question: Who's Paying What?,

The federal income tax bill for a person making $15,000 is 51 percent higher today than it was 30 years ago -- a big jump.

... If you make $100,000, you'd be paying 33 percent less today than in 1981.

Someone making a really good living that brought in $250,000 would pay 47 percent less – that person's federal income tax bill dropped from $126,953 in 1981 to $67,398 today.

It hasn't just been income-tax cuts, either. The businesses owned by the top few percent have also been getting the breaks. Joshua Holland again, in How Big Business Gets a Free Ride by Lobbying to Raise Your Taxes, explains,

Well, consider this: in the 1940s, corporations paid 43 percent of all the federal income taxes collected in this country. In the 1950s, they picked up the tab for 39 percent. But by the time the 1990s rolled around, corporations were paying just 18.9 percent of federal income taxes, and they forked over the same figure in the first decade of this century. We – working people – paid the difference.

So what we are seeing it that the income at the top is rising:

While the taxes at the top are falling:

And the taxes paid by the corporations is also falling:

How Did It Happen?

Since the early 80s our economy has been restructuring itself in ways that send almost all of the gains to a few at the top. "Free trade" pitted our workers against exploited workers in a race to the bottom. Deregulation removed consumer and other protections, allowing corporations to become predatory and monopolistic. Meanwhile the tax system has been restructured to send the tax collections downward. One of the biggest tax shifts was increasing the Social Security payroll tax on those at the bottom and middle – money that was supposed to be set aside for their retirement -- and using that money to fund tax cuts for those above. And now they claim all that money people were putting away is gone so we need to cut their retirement by moving the retirement age out. In addition the corporations are paying a lower share of the taxes as well.

America Is Not Broke

Simple answer to a simple question: America is not broke, we are richer than ever. But the "We" that make up We, the People are not sharing in the gains, while the "we" that make up the wealthy few are not sharing ... anything. The tax cuts have stolen from us our ability to maintain our infrastructure, education our people, maintain our competitiveness in the world and take care of each other.

As Michael Moore said in Wisconsin,

"America is not broke, not by a long shot. The country is awash in wealth and cash. It's just that it's not in your hands. It has been transferred, in the greatest heist in history, from the workers and consumers to the banks and the portfolios of the uber-rich."

Here's Cenk on this:

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Posted by Dave Johnson at 1:58 PM | Comments (0) | Link Cosmos

April 16, 2011

Will Any Conservative Sites Link To This? Fat Chance!

Will any conservative sites link to this at the White House website? Fat chance. Conservatives depend on people remaining ignorant of where tax dollars are actually spent.

Your 2010 Federal Taxpayer Receipt | The White House offers a breakdown of where your tax money is spent. At the site you can drill down into each of these to see more details.

National Defense 26.3% (Note that Veterans funding is broken out separately. I combine them in the chart.)
Health Care 24.3%
Job and Family Security 21.9%
Education and Job Training 4.8%
Veterans Benefits 4.1%
Natural Resources, Energy and Environment 2.1%
International Affairs 1.7%
Science, Space, and Technology Programs 1.2%
Immigration, Law Enforcement and Administration of Justice 2.0%
Agriculture 0.8%
Community, Area, and Regional Development 0.5%
Response to Natural Disasters 0.4%
Additional Government Programs 2.4%
Net Interest 7.4% (Note that they use net, which subtracts interest received, instead if how much we pay out on the Reagan/Bush debt, which is approx twice as much.)

Social Security is separate and self-funded.

I made a pie chart: (click for larger)

To fix the budget deficit:

1) Fix the hole in revenue by putting top tax rates back to where they were before Reagan.
2) Cut military spending. We spend more than all other countries combined.
3) Fix the health care cost problem. We spend much more per person than other countries. You know why.
4) Much of that big "Job and Family Security" slice goes away if you create jobs.

Posted by Dave Johnson at 4:47 PM | Comments (5) | Link Cosmos

April 7, 2011

Budget Battle: Who Is Our Country FOR?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Who is our country for? Is this a country for We, the People, where all of us are banded together to protect and empower each other, together? Or is this a country where a powerful few reap all the benefits, and the rest of us are little more than "the help?" That is what the coming budget/deficit/debt/shutdown battles are about.

In the past several decades our country and economy has been thrown out of balance in ways that hurt most of us but greatly benefit a powerful few. Communities are being bankrupted, forced to lay off police, firefighters, teachers, nurses and other essential people who work to protect and help us. More and more working people are hurting, falling ever further behind, losing or barely clinging to their jobs and homes and businesses and health. At the same time big-company CEOs who cheat, bankrupt their company, ship jobs overseas and fire white collar workers by the thousands are not held accountable -- instead they are rewarded with big bonuses.

And in the larger picture the country is falling behind, the economy is losing its competitive edge, the infrastructure that supports our businesses is crumbling and our public structures like the court system and schools are deteriorating. And in the face of this decline our public confidence, trust, civility and other measures of civic health are falling.

The measure of any serious budget deficit reduction program should be to look at these imbalances and address them. That is the role of We, the People government. But instead, the new Republican budget accelerates the imbalances -- on purpose. It cuts or eliminates the programs that assist people, helping us maintain or rise to a middle-class existence.

Decades of Stealth Attack

Most of us probably thought this country was a "We, the People" democracy where we are all in this together, looking out for each other. But for decades corporate conservatives have been engaged in a stealth attack on the middle class, taking all of the gains of our joint investment in a prosperous economy just for themselves.

The effects of the stealth attack on the middle class have been creeping up on us, and are now widely felt. Incomes have been stagnant for some time, as costs rise. Predatory industries increasingly prey on the public and small business. At the same time a powerful and wealthy few have benefited from these changes so much that today, just 400 people have more wealth than half of our population of 300 million people combined!

One measure of the price of maintaining a middle-class existence is the "toil index." The index of toil measures the work hours it takes for a family to live in an average home where children have access to an average school. In the past few decades the work hours required to maintain a middle-class existence has gone up 62.4%.

So in 1950 the "toil index" was 42.5 hours. That dropped to 41.5 by 1970. But then it started to rise -- a lot. By 2000 it was 67.4 hours, an increase of 62.4%! Yet this was at a time when the country as a whole got ever wealthier. And since 2000 it has obviously gotten much worse.

Now The Attack Is In The Open

Now the attack on the middle class is out in the open. The new Republican budget plan takes away any pretense of our government working for We, the People, and transforms it completely to a government of, by and for the top 1%. Programs to maintain the middle class are cut or eliminated. Help for the jobless is cut back. Government workers are eliminated. Medicare is privatized. Social Security is phased out.

But in this budget taxes for the wealthy few and big corporations are cut, big oil companies continue to raid the treasury, the arms industry prospers and other multinational giants continue to receive subsidies and advantages over smaller, less-powerful competitors.

This budget is clear in its purpose: to create a one-dollar-one-vote plutocracy for the wealthy few, while gutting our one-person-one-vote democratic system.

How We Got Here

Let's look at the effect of the recent decades of this stealth attack on our We, the People government and economy.

Top tax rates for the rich have been dropping and dropping, resulting in big budget deficits that add up to big debt:

The Republican budget doesn't fix this at all. It makes it worse. It cuts tax cuts for the rich even more, and guts the things We, the People do for each other.

The next chart shows how corporate taxes have declined, the one after that shows who owns those corporations:

So at the same time as income taxes for the wealthiest dropped the tax share from the corporations -- mostly owned by the wealthiest few -- also declined dramatically. On top of that cuts in taxes on capital gains and dividends pushed even more of the gains to the top. The Republican budget plan makes this worse.

As top tax rates have been dropping working people's payroll taxes have been rising. This is the money we set aside in the Social Security Trust Fund for our retirement. (Chart from Urban Institute)

The Republican budget not only doesn't address this, it raids this money we have set aside for retirement by cutting our retirement benefits!

Because of cuts in taxes for the rich and the corporations they own, inequality has been increasing dramatically. The Economic Policy Institute shows that, "The share of income going to the majority of households has dropped considerably since the 1970s.. Share of household income held by bottom 99.5%, 1913-2008:"

The share of income that 99.5% of us get has fallen from 93.7% to 83.1%. The top half percent get all the rest. The Republican budget plan doesn't fix this at all. It makes it worse.

Here is a chart of the increasing concentration of income at the top:

The Republican budget plan doesn't fix this at all. It makes it worse.

How It Happened

The "Reagan Revolution" cut taxes, deregulated business, opened our borders to let in goods from "thugocracies" that exploit workers, dramatically increased military spending and cut back on the things we (government) do for each other. It cut back on investment in our people, our infrastructure, education, public structures like our courts, our labor protections, our consumer protections, and attacked the independence of the ways we receive objective information. Things have gotten steadily worse in the years since.

Last year's post Reagan Revolution Home To Roost -- In Charts shows the impact on us of these changes over time, concluding,

Sometimes it can be so obvious where a problem comes from, but very hard to change it. The anti-government, pro-corporate-rule Reagan Revolution screwed a lot of things up for regular people and for the country. Some of this disaster we saw happening at the time and some of it has taken 30 years to become clear. But for all the damage done these "conservative" policies greatly enriched a few entrenched interests, who use their wealth and power to keep things the way they are. And the rest of us, hit so hard by the changes, don't have the resources to fight the wealth and power.

Look at the influence of these entrenched interests on our current deficits, for example. Obviously conservative policies of tax cuts and military spending increases caused the massive deficits. But entrenched interests use their wealth and power to keep us from making needed changes. The facts are here, plain as the noses on our faces. The ability to fight it eludes us. Will we step up and do something to reverse the disaster caused by the Reagan Revolution or not?

The Republican budget plan doesn't fix this at all. It makes it worse. Much, much worse.

More Charts

In the meantime, lobbying to influence our government against the things that help We, the People has gone through the roof.

(Chart source Sunlight Foundation.)

The Republican budget doesn't fix this at all.

They lobby because it pays off. It pays off because the lobbying buys them special favors, breaks, subsidies and policies that favor them over their competitors and the rest of us. This happens because we let them get away with it. Of course when powerful interests can use money to bend the rules they will bend the rules in their own favor -- and will start by bending the rules in ways that let them bend the rules even more.

Of course this is what they have been doing. Here is what is happening in the case of some specific industries:

Lobbying for "defense' has increased:

And the result show how this has paid off: (note, chart includes defense-related spending.)

We spend more on military than all other countries combined. The Republican budget doesn't fix this at all.

Imbalances

So these are just some of the imbalances that government should be addressing. But it isn't. The Republican budget doesn't fix this at all. It just makes all of these problems and imbalances worse. And this is because of that ability of the wealthy and powerful to pay to get the rules bent in their favor. We need to instead change the system to hold politicians and CEO’s accountable, making sure the rich are not abusing the system.

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Posted by Dave Johnson at 12:23 PM | Comments (0) | Link Cosmos

March 29, 2011

Budget Fight: Why Are Republicans Forcing A Shutdown?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Why are Republicans forcing a government shutdown and doing other things aimed at blowing up the economy? The question isn’t “are they,” it is why are they? Their election strategy for 2010 was to obstruct everything and keep the economy from creating jobs, and then blame Democrats. It worked. So now they're doing it even more. But is that the whole plan?

In every instance Republicans are obstructing the very things that can help the economy recover and provide the jobs people need. Everything they do is aimed at making things worse. It is hard to understand their actions except as a systematic attempt to blow up the economy.

• They are blocking agreement on a budget to keep the government going.
• They are terrifying the credit markets by threatening to block an increase in the country's debt limit.
• They are refusing assistance to states, forcing the states to lay off hundreds of thousands of teachers, etc.
• They are fighting to roll back every regulation that relates to banking and finance.
• They are killing high-speed rail and solar and wind projects.
• They are blocking renewable energy standards and other policies that trigger investment and jobs.
• They are blocking needed stimulus programs that help recovery.
• They are blocking unemployment benefit extensions.

When confronted they offer ridiculous explanations which are really only cover for the actions, so they can claim to have a reason beyond destruction. But this is only to provide cover and keep the press and public from calling them out for what they are.

Cutting Jobs Creates Jobs?

Speaking of ridiculous explanations, they say they are cutting jobs in order to create jobs. Seriously. Digby today, in Flooding The Market, caught this about the Republican plan,

For example, the [Republican economic report] paper predicts that cutting the number of public employees would send highly skilled workers job hunting in the private sector, which in turn would lead to lower labor costs and increased employment. But “lowering labor costs” is economist-speak for lowering wages — does the GOP want to be in the position of advocating for lower wages for voters who work in the private sector?

Got that? Throw enough people out of work and wages go down, which they say leads to more employment. That's their plan?

One advantage of throwing so many people out of work is that they will work for very little just to eat and feed their families. This is great if you own a business (and don't care about people) -- not so great if you depend on American consumers to purchase what you sell. But that's a problem for later, after you've broken the unions and cut your labor costs. We know this is one part of their strategy because they said so.

A Grander Strategy Than Killing The Economy To Win In 2012?

Are they killing the economy in order to win the next election? Or is this part of an even grander strategy?

So is there a bigger plan at work here? Step back from the day-to-day for a minute, and away from the fog of propaganda and smoke and sand thrown in our eyes to keep us from seeing what is really happening. For decades conservatives have said government is bad, in the way, intrusive holding business back, bureaucratic, inefficient, etc. You have heard the litany, over and over and over.

So What IS Their Plan?

It seems conservatives are always running one strategy or another, always working on a plan. Speaking of grand strategies and plans, watch this from Lee Camp:

They Hate Government

If you read their websites and magazines you know that they hate government and talk about ways to get rid of it. They have said they just want government to go away and have been running strategies to get it small enough that they can drown it in a bathtub. If you are a Republican who doesn't think destroying government is the best approach you are called a RINO and shunned.

They don’t talk about governing, they talk about killing government, and when they get power they don't govern they destroy government. They appoint industry lobbyists to agencies that are supposed to oversee their own industries. They appoint polluters to the agencies that are supposed to protect us from pollution. And they appoint people who have called for getting government out of areas like education, medical care, etc. to head up and dismantle those departments.

They talk about destroying government, not governing. So what makes the DC opinion elite think they want to govern now?

Destroy Government Then Blame Government For The Consequences?

Trickling up from conservative underground lately are more and more arguments that government itself is responsible for the crumbling infrastructure, loss of economic competitiveness. The unspoken answer - so far - is that we need to get rid of government itself to get rid of these problems.

Last Week in Detroit’s Liberal Nightmare, the Heritage Foundation paves the way for what I think we will see coming from conservatives,

Detroit, once known as “the great arsenal of democracy,” has made headlines of late for its notorious fall from grace. ... And while the Motor City suffers unemployment from a decimated automotive industry, it suffers crime, high taxes, poor city services, plummeting home values, and a public education system in shambles with a $327 million budget deficit and a 19 percent dropout rate. Is it any wonder people are leaving in droves?

Just today, in Voting With Their Feet, Thomas Sowell blames government for other areas where the census shows are are losing population,

Both whites and blacks are leaving California, the poster state for the liberal, welfare-state and nanny-state philosophy.

Whites are also fleeing the big northeastern liberal, welfare states like Massachusetts, New York, New Jersey and Pennsylvania, as well as the same kinds of states in the midwest, such as Michigan, Ohio and Illinois.

And unspoken in all of their anti-government arguments is just what will replace government, namely the big, powerful corporations and the wealthy few behind them.

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Posted by Dave Johnson at 2:57 PM | Comments (1) | Link Cosmos

February 18, 2011

Republicans Cut Jobs, Keep Oil Company Tax Breaks, Don't Cut Military!

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

As you read this, remember what Republicans did just a few weeks ago to force huge tax cuts for the wealthy, adding as much as $900 to budget deficits. Also, keep in mind that we spend more on military than every other country combined.

People Want Job Creation Not Cuts

Finally, keep in mind that polls show the public wants job creation, and does not want cuts in the things government does for We, the People. On the Campaign for America's Future website front page under "THE PULSE" you can see the results of a poll, showing significant majorities reject cuts in various programs. (Other polls show broad public support for increasing taxes on the wealthy.)

What the public wants, the public doesn't get. This isn't about what the public wants. It certainly isn't about jobs. And, right after increasing the deficits with huge tax cuts for the wealthy, this is not about cutting deficits, either. It certainly isn't about governing or the public interest. This is about one thing only: gutting the hated government.

They Campaigned Against Cuts

In the midterm elections campaign ad after campaign ad asked voters to reject Democrats because they had cut Medicare! They campaigned against Democrats for "cutting $500 billion from Medicare" and not increasing Social Security cost-of-living. As a result, for the first time the senior vote went to Republicans.

Job-Killing Cuts -- "So Be It"

Instead, now in office, Republicans are cutting jobs programs, cutting government jobs, cutting aid to states to keep jobs, and cutting government infrastructure programs that create jobs.

No Cuts In Military?

TPM: Boehner's Spending Cuts Would Kill 1 Million Jobs,

According to federal budget expert Scott Lilly at the Center for American Progress, Boehner's proposed spending cuts could kill almost 1 million jobs.

WSJ: GOP Presses Biggest-Ever Budget Cut,

In early action on the bill, which would cut domestic programs by $61 billion this year, Republicans showed little appetite for making cuts in the Pentagon. The House rejected four amendments to cut defense programs, including one small cut to get rid of some Pentagon advisory commissions.

. . . The Republican bill would cut spending in domestic non-entitlement programs such as high-speed high-speed rail construction, water projects and job training far more deeply and quickly than President Barack Obama and most Democrats favor. The White House issued a veto threat immediately after the bill came to the House floor.

Shutdown?

NY Times: House G.O.P. Pushes $61 Billion in Cutbacks

The current stopgap measure financing the government expires March 4. If the House and Senate are unable to come to an agreement before then or if the financing is not extended temporarily, federal agencies could be shut down. ...

Even as Democrats attacked proposed cuts to programs that help economically struggling Americans and to initiatives involving education, the environment, housing and employment, Republicans lined up to make deeper reductions. The first amendment offered was a proposal to eliminate more than $18 million from the Pentagon budget. ...

But the proposal was defeated on a vote of 223 to 207 and other initial efforts to make deeper reductions failed as well.

Running Through A Hospital With A Machete

Instead of considering how to govern, they are just gutting. No consideration is being given to the value of programs, or the long-term cost of cuts, it is just a frenzy of cutting for the sake of cutting.

LA Times: Criticism mounts as GOP presses ahead with budget cuts,

. . . Criticism mounted at the start of a House debate as Democrats took aim at GOP plans to maintain tax breaks for oil companies and the wealthy while cutting medical research, community policing and funding for "Sesame Street"...

. . . Still, GOP leaders said the rollback was necessary, even at the expense of thousands of jobs funded by government programs on the chopping block.

"If some of those jobs are lost in this, so be it," said House Speaker John A. Boehner (R-Ohio). "We're broke."

. . . The liberal-leaning Economic Policy Institute has estimated as many as 800,000 jobs could be lost under the Republican proposal.

. . . The GOP reluctance to cut Pentagon spending became apparent as voting began, when an amendment to cut $18 million in Defense Department operations and maintenance was rejected. [emphasis added]

We Need A Movement For Jobs

We have a jobs emergency. People need jobs. The public is demanding that our government address jobs. But this is not what is happening in Washington. We, the People have got to get heavily involved now and apply the necessary pressure to force Washington to act for jobs.

March 10 Summit on Jobs and America's Future

On March 10, 2011, the Summit on Jobs and America’s Future will bring together leaders and activists who understand that America faces a jobs crisis – and who are committed to building a political movement for sustainable economic growth, dynamic job creation, and a revival of the American economy.

Free. $15 with lunch. Register here.

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Posted by Dave Johnson at 3:43 PM | Comments (0) | Link Cosmos

January 12, 2011

They Even Filibustered The Public Printer!

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

The Senate is considering changing the rules for the "filibuster" and this is an opportunity for you to do something that can make a difference. The filibuster has been abused and the Senate is broken. Call your Senators and tell them you want this fixed!

"Abuse" does not adequately describe what has happened with the filibuster and "broken" does not adequately describe what has happened with the U.S. Senate. Two years ago We, the People voted for change, but in the Senate change and everything else was blocked. Everything was filibustered as part of a strategy to demoralize people and undermine democracy. Everything. Important bills, judges, agency heads, ambassadors and all the things that constitute "everything." And the strategy worked.

They even filibustered the Public Printer!

What is the Public Printer? The Public Printer heads up the U.S. Government Printing Office (GPO). The GPO manages our country's public documents. They print but also electronically distribute the Congressional Record, Supreme Court decisions, passports, tax forms, internal government documents, and agency publications. (They don't print the money.)

Benjamin Franklin served as the Public Printer when we were a colony, though the current office was established by Congress in 1861.

I am unable to locate any stated reason why the nomination of the Public Printer was filibustered, leaving me to assume that this particular filibuster came under the classification of "everything." Therefore the Public Printer was filibustered.

So now the Senate is considering whether to change their system. They are voting on January 24. They are considering making Senators actually filibuster instead of being able to block things from a nice table at a nice restaurant. This way the public will be aware that this tactic is being used to block things and can respond accordingly.

This is why you should call your Senators - both of them - today, and tell them that you want the Senate to reform the filibuster.

If you do this, some of them will say "Uh oh, they're on to us." They depend on the public not understanding what is going on, but if you call they will know that you are hip to their bag of tricks.

Others will say, "Hey, I don't have to be afraid to change things, they are paying attention!" These Senators will know that they have support and will be nudged toward voting to fix the problem, which will help make it so they can fix the rest of the problems.

Either way, calling WILL do some good. So call. Today. And tell others to call.

This is Annie Hill of the Communication Workers Union, with an overview of Senate Rules Reform:

Warning: If you are not a political junkie you might want to stop reading now and go call your Senators and say you want the filibuster reformed. The following content might be unsuitable for normal audiences.

Ezra Klein, with one of the best blog post titles in a long time, If you read only one John Kerry speech today ...,

I'm not going to summarize it here, because I think it's actually worth taking five minutes to read it in full. But the whole thing is below the fold:

Yes, if you like to read John Kerry speeches you should click through to read the whole thing, but just in case you are the rare individual who does not live to read John Kerry speeches here is "the meat," (and keep in mind that I, a vegetarian, had to actually read the speech to find "the meat" for you),

John and I considered postponing this speech, which had been planned for some time. But serious times call for serious discussions. And after some reflection, both of us felt that not only should this speech not be postponed, but that, in fact, it was imperative to give it.

Oh, wait, that's apparently not the interesting part. This is, about 115 paragraphs into the filibuster talk.,

Sometimes, as John Kennedy once said, “party asks too much.” Sometimes, party leaders also ask too much, especially if they exploit the rules of the United States Senate for the sole purpose of denying a President a second term. But that is what we have witnessed the last two years; Republicans nearly unanimous in opposition to almost every proposal by the President and almost every proposal by Democratic colleagues. The extraordinary measure of a filibuster has become an ordinary expedient. Today it’s possible for 41 Senators representing only about one tenth of the American population to bring the Senate to a standstill.

Certainly, I believe the filibuster has its rightful place. I used it to stop drilling for oil in the Arctic Wildlife Refuge because I believed that was in our national interest --and 60 or more Senators should be required to speak up on such an irrevocable decision. But we have reached the point where the filibuster is being invoked by the minority not necessarily because of a difference over policy, but as a political tool to undermine the Presidency.

Consider this: in the entire 19th century, including the struggle against slavery, fewer than two dozen filibusters were mounted. Between 1933 and the coming of World War II, it was attempted only twice. During the Eisenhower administration, twice. During John Kennedy’s presidency, four times-- and then eight during Lyndon Johnson’s push for civil rights and voting rights bills. By the time Jimmy Carter and Ronald Reagan occupied the White House, there were about 20 filibusters a year.

But in the 110th Congress of 2007-2008, there were a record 112 cloture votes. And in the 111th Congress, there were 136, one of which even delayed a vote to authorize funding for the Army, Navy, Air Force and Marine Corps during a time of war. That’s not how the Founders intended the Senate to work-- and that's not how our country can afford the Senate not to work.

If only I could move to DC so I could listen to speeches like this every day instead of just reading them.

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Posted by Dave Johnson at 5:19 PM | Comments (0) | Link Cosmos

December 15, 2010

The New Revolutionaries Take to the Internet: The Tale of WikiLeaks and Julian Assange

WikiLeaks raises some of the most poignant questions of our time about the power of cyber warfare, the role of hackers, and the future of the Internet. It is not a coincidence that Madame Secretary of State Hillary Clinton has created a whole new effort to explore and fight cyber terrorism. In fact, WikiLeaks and Assange may represent the first of the wholesale anarchists using today's information highway to do battle. Consider that instead of taking to the streets in protest, this generation may take to the Internet to wage their battles and carry their message. We are living a time represented by the power of Facebook that links over 500 million people together. And if this is true, we may have unleashed a whole new generation of cyber warlords on the world's information centers.

Many of our brethren are writing about democracy, liberty and the freedom of information pivoting off what they believe WikiLeaks stands for. Julian Assange has been elevated to the "Man of the People" as filmmaker Michael Moore contributes to his bail fund, and the Huffington Post sets up a whole section devoted to whistleblower Fantasy Land. You know, we all need something valiant to believe in during the difficult days of Obama. The obnoxious wealthy are dancing on the heads of US lawmakers. The banks are still doing the Texas two-step, and the Middle Class continues to suffer in silence with simmering rage. There are two deeply divisive wars. China is rising and scaring the heck out of us. The liberals of the Democratic Party continue to act like toddlers, and Sarah Palin is making hay laughing all the way to her off-shore accounts. So Julian Assange, or whoever is backing him, could not have picked a better moment of discontent. They are evoking new archetypes of good and bad in a world that is increasing grey.

Assange is the anti-hero. He has been personified as a man with no country who is a metrosexual kind of guy willing to risk it all to uncover the truth. Yet, we don't really know much about this man, or what makes him tick. Is he really the wizard behind or the curtain, or there really someone or something else pulling the strings. Is he a hacker extraordinaire, or just a man that is a brilliant online community organizer? In fact and most importantly, what does it mean to be a hacker? Are hackers by definition anarchists, or is it just Julian that wants to topple the establishment at any cost. Or are there droves of these cyber-sleuths trolling the black lands of the Internet looking for back doors into silos of information? Remember Assange was a cryptologist of sorts which is the super duper folks that develop the ways to tunnel into software code. And it may be fair to assume that these same hackers were probably responsible for the DOS (Denial of Service) attacks on Visa, Master Card and others. And if this is true then who is really pulling the strings since these were very, targeted attacks on specific corporations that shut out the money flow for WikiLeaks? The bottom line is that we still don't know how the WikiLeaks information is gathered and/or obtained. Does it come from this new breed of whistleblowers, such as Private Manning that had a rare blend of tech talents and access? If so; does this new breed even resemble our beloved archetypical whistleblowers circa Daniel Ellsberg, or even Erin Brockovich? And I ask again, have we grappled with the ramifications of an Internet that is locked down in response to WikiLeaks? Are we ready to usher in a new age of restrictions? This sadly will make the debate around net neutrality seem like child's play if cyber war erupts.

Please note that this post appeared earlier in the day in the Huffington Post.

Please note that a selection of the reference material used for this article and others in the past on WikiLeaks is included in the complex pearltree below.

Posted by Michelle at 11:43 AM | Comments (0) | Link Cosmos

November 26, 2010

Tax The Rich: A Deficit Plan That Doesn't Hit We, The People

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Here is MY deficit-reduction plan. This plan does not reflect the views of anyone but myself -- and maybe half the population. Unlike deficit plans from the "serious people" in DC, this one doesn't annihilate the poor and gut Social Security and the middle class while passing even more of the benefits of our society up to a few at the top.

1) Restore pre-Reagan top tax rates. We didn't have massive deficits until we reduced the top tax rates.

2) Income is income. No more reduced capital gains tax rate. The incentive to invest should be to make a bunch of money from a good investment. The reason there is a low capital gains tax rate is that the wealthy get most of their income from capital gains. And the reason they get most of their income from capital gains is there is a low capital gains rate. The resulting income shifting schemes are a drag on the rest of us. (Also applies to dividends.)

3) Income is income. Inheritance income should be taxed as income, except there should be a "democracy cap" on how much someone can inherit. We decided not to have an aristocracy when we founded this country so we shouldn't have one.

4) Businesses should be taxed or not taxed, but not taxed AND not taxed. They shouldn't be able to use "double Irish" or "Dutch sandwich" or operate out of PO boxes in Bermuda or the Cayman Islands. (Bonus, this also helps reduce incentives to send our jobs and factories out of the country.)

5) If you don't pay your taxes We, the People won't pay to provide you with services. We can start by not allowing you to have a driveway that connects to public streets, or water/sewer hookups or mail. Also we won't enforce any contracts for you, including the one that says you "own" your house(s). And no government-developed Internet for you.

If companies like Google want to "double Irish" and "Dutch Sandwich" us or operate out of PO boxes in tax havens, we shouldn't let them use government services like courts, or the government-developed Internet. See how well they operate without access to roads (that includes for employees to get to go to work.) How about withdrawing the limited liability protection that investors in corporations receive? And of course no protection for "intellectual property" or trademarks. Oh, yeah, no access to anyone who went to a school that used tax dollars. And no government services means no sea-lane protection for your products shipping from Chinese factories, by the way.

6) Speaking of sea-lane protection, why do we have a military budget comparable to when we faced nuclear annihilation by the Soviet empire? Bases in Germany and Japan? And why can I go to this website, pick a DC-area zip code, say 22314, and learn that "Dollar Amount of Defense Contracts Awarded to Contractors in this Zip Code from 2000 to 2009: $7,086,397,848." Seriously, scroll down the page and look at some of the contracts and amounts awarded. I suspect there's some serious deficit reduction to be found in the military budget. A comprehensive and very public audit of where all that money has been going since, say, 1981 might take a chunk out of the debt problem all by itself

7) I could start listing all the corporate subsidies, tax breaks, monopoly grants, schemes, contracts, etc. that we pay for, but I think you get the idea. How about calling bribery by its name: bribery, and doing something about it?

8) To the extent that implementing this plan does not clear up the deficit and start paying off the debt, how about a yearly national property tax on all individual holdings above, say, $5 million, with the tax rate progressively increasing as total wealth increases, and keep doing this each year until the debt is paid off. Perhaps start at 1% on $5 million, 2.5% at $10 million, 5% at $50 million, etc. (Hedge fund managers and investment bankers start at 50% and go up, just for the heck of it. We can call this the "get the money from where the money went tax.")

So there is MY deficit-reduction plan. Or, instead, we could do what the "serious people" deficit-reduction plans do: cut services for We, the People, cut Social Security, cut health care, cut education, cut infrastructure, cut the things that make life better for people, and give all the money to a few at the top. Take your pick.

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Posted by Dave Johnson at 1:39 PM | Comments (2) | Link Cosmos

November 10, 2010

What's Next, Impeachment from the Republicans?

So much for making nice Mr. President, the gloves are off as the Republican leadership comes out swinging. These folks don’t want to work with you, or your minions or any of us. Just tune into FOX News at any random moment, and the disdain is visceral. And to be blunt, what’s to keep them from starting impeachment proceedings as a tactic to erode your precious time and focus? Not much, if you listen closely to the Senate Republican leadership, the soon to be Speaker of the House, and all the other hooligans over the last few days, and even on the Sunday morning talk shows. Senator Mitch McConnell’s words sure don’t sound like a lullaby to me. Do not be fooled, it may be more than making sure that Obama is a one-term President. These are fighting words: “The only way to do all these things is to put someone in the White House who won't veto...”

And if that’s not bad enough, there’s dissent and discontent (as usual) among our fellow Democrats. The so-called Blue Dog Democrats are acting out by attempting to distance themselves from the prevailing incumbent-rage by attacking now Speaker Pelosi. Have they no shame? This is self-serving hypocrisy at its worst. Not now kids. Go back to your corner and sing “Kumbaya” to keep from shooting off your big mouths at this fragile time. Enough of your ranks have been lost in this recent election. Stop with the posturing, and the “Anti-Pelosi Caucus.” These types of shenanigans only fuel the fires, and distract us from our goals. Please realize that we are under an unprecedented assault from the rabid Republican leadership. They will attempt to sink the Obama ship at any cost.

Democrats (Blue Dogs, Moderates, and Progressives) hunker down. Put a stop to the malarkey from the newly anointed Republicans. This “lame duck” session is vital. We have barely two months to protect Social Security for the elders, unwind Don’t Ask Don’t Tell, and fund many, many programs. Consider that the Congress may be deadlocked for two years with very little emerging from gridlock, and Pelosi's steam rolling machine has taken heavy artillery hits. If you feel compelled to beat up on someone or something, go after the bad guys. And pray that all attempts to bring impeachment proceedings against Obama are quashed. This would be a travesty filled with hate and racism from which this country might never recover. Don't let them take our President away.

Note: A version of this article was published earlier today in the Huffington Post.

Posted by Michelle at 8:46 AM | Comments (1) | Link Cosmos

September 9, 2010

To Fix The Economy Raise Wages

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

To fix the economy we have to fix wages. Increased wages will restore demand. The changes that will increase wages will help restore democracy.

The social contract used to be that citizens in our democracy share the benefits of our economy through increased wages that come from increases in productivity. This broke down and working people's incomes have been stagnant since the Reagan Revolution. (Yes, I'm telling the same story again. It needs to be told, over and over so people can understand what is happening to us. We are feeling the effects of the Reagan Revolution coming home to roost.)

Reagan and the conservatives weakened the government and broke the unions. Government and organized labor were the forces in our society that had stood up for the interests of regular people against the "moneyed interests" and weakening them fundamentally changed the fairness equation of our economy. After the Reagan Revolution working people's share of the benefits from increased productivity turned down:

All of the benefits of improvements in our economy now flow to a few at the top. This results in intense concentration of wealth:

With more and more of the income and wealth going to a top few, We, the People are thought of less and less as citizens and more and more as "the help." But who is our economy for, anyway? Our economy can operate for the benefit of We, the People, or it can operate for the benefit of a wealthy few at the expense of the rest of us. This is the ongoing battle. And history has shown over and over that when economies operate for the few, they don't work.

This is not just about sharing the economy, it is about sharing the decision-making power. In our form of government We, the People are supposed to make the decisions. When Reagan said, "Government is the problem" he was really saying that decision-making by We, the People is a bad thing. When conservatives complain about "big government" they are complaining about We, the People having a big share in decision-making. When they call for "less government" they are calling for less of a share of the decisions-making by us. This means the wealthy and powerful have more of a share -- of everything.

With the income, wealth and benefits of the economy increasingly flowing to a top few, working families tried to compensate for the loss in various ways. Women entered the workforce. Former Labor Secretary Robert Reich explains, "By the late 1990s, more than 60 percent of mothers with young children worked outside the home (in 1966, only 24 percent did)." (Please read his whole post if you have time.)

Then, still not getting by on stagnant wages with rising prices, people worked more hours or added second jobs. Then they started using up their savings.

Finally they resorted to adding debt.

This all finally broke down, demand slowed, and the economy has slowed to a crawl. The 90s financialization and "dot com" bubbles obscured the way things were headed, and then the housing bubble of the 2000s continued the illusion. But debt just kept rising people kept working longer and harder to get by, while the richest few kept getting richer. Finally it all crashed and current attempts to prop it up by helping the wealthy and big businesses are not succeeding. Bailing out big banks and their executives and shareholders and not holding anyone accountable, while letting predatory corporations continue their economy-draining practices has not only kept the worst parts of the "share of the wealth" problem in place, it has undermined people's faith in government and demcoracy. Changes need to be made.

Most people pay for things with income from jobs. If we want demand to rise, then we need to raise incomes. But things are still going in the wrong direction. As CAF's Robert Borosage writes today,

"Over the last decade, we lost one in three manufacturing jobs. Inequality reached Gilded Age extremes. CEOs and bankers pocketed million dollar bonuses while cooking the books and gambling on exotic securities, inflating the housing bubble until it burst. Health insurance companies kept a strangle hold on a health care system that costs twice as much as those in other industrial countries, leaves millions uninsured and provides worse health care."

Who Gets What For What?

This bad economy situation is going to drag on until we make real changes in the structure of who gets what for what in this country. Every incentive in the economy is to try to reduce wages, cut benefits and eliminate jobs. Think about that. People get bonuses and raises and owners get richer if they eliminate YOUR job or at least cut back your pay and benefits. For example, by replacing a worker with a machine, the owner of the machine gets more money, the worker gets nothing. But in the larger economy each time this happens it means there are fewer people in a position to buy whatever goods or services the same companies that eliminated the jobs are in business to provide. And it means that a few wealthy people become more wealthy and powerful.

This is where government comes in. Government is supposed to be the force that speaks for and protects the interests of the people, empowers people through education and rules, set conditions to keep wages high, lay down the infrastructure in which businesses thrive, and coordinates the international competition for industries and jobs. But the Reagan Revolution broke that. We need to restore it.

There are so many things that government could be doing to get the economy working again for working people, small and medium businesses and big corporations that want to make an honest living. Boost the minimum wage, modernize the infrastructure, provide health care, provide free education through graduate level, increase Social Security, help unions organize, impose a democracy tariff so imports don't get around the protections provided by our democracy, and return to taxing the rich who reap the dividends and payout of all the past investment that We, the People made to make business thrive.

And there are larger structural changes we can make. Just brainstorming but what if workers replaced by machines directly got some of the income generated by the machine. Workers laid off this way several times might then have enough income to get by without working! Or what if we cut the workweek from 40 hours to, say, 35 before overtime kicks in. Maybe that would increase hiring, while giving regular people more leisure time. (And keep cutting the workweek as machines and computers do more of the work.)

And, of course, to have wages at all people have to have jobs. One would think this would go without saying but these days it seems there is a need to point out that people are hurting for jobs, because the DC elite seem to have moved on from that. We badly need government programs to directly hire people to do things that help the people of the country. We would have all of this if the Reagan Revolution hadn't weakened government of, by and for We, the People.

Other posts in the Reagan Revolution Home To Roost series:

Tax Cuts Are Theft
Reagan Revolution Home To Roost -- In Charts
Reagan Revolution Home To Roost: America Drowning In Debt
Reagan Revolution Home To Roost: America Is Crumbling
Finance, Mine, Oil & Debt Disasters: THIS Is Deregulation

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Posted by Dave Johnson at 11:52 AM | Comments (0) | Link Cosmos

August 13, 2010

Now We Know What Public Wants - Get Candidates On The Record

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Tomorrow is the 75th birthday of Social Security. It is the most successful government program, demonstrating that government of the people, by the people and for the people works. For this reason a new poll shows that politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation. Let's get candidates on the record with a pledge to honor and protect this valuable program.

Yesterday in Social Security – A Divide Between DC And The Rest Of Us, I wrote about a new poll that shows that the public understands something that the DC elite don't seem to get: The public gets it that the way to fix the deficit is to ask the rich to start paying taxes again, invest in infrastructure which provides jobs and enables businesses to prosper -- and don't touch Social Security benefits. (Click here for more on the poll.)

The clear message of the poll: Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation.

So now it is time to get our politicians on the record. Campaign for America's Future is asking candidates running for Congress to make this pledge: Hands off Social Security: No increase in the retirement age, no privatization, no Social Security cuts. Sign the petition to your member of Congress. And you can find out your member of Congress stands on Social Security. Use ourfuture.org/handsoffsocialsecurity to find out. And bookmark this page so you can come back and watch the list grow.

You can help us hold Congress accountable: Ask candidates to make the pledge and email promise@ourfuture.org with the answer.

And again: Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation.

Here are some useful websites for engaging in this fight to save Social Security:

Click here for more on the poll.

Click here to see which members of Congress have signed the "Hands Off Social Security!" pledge

Click here to sign the petition: Hands Off Social Security!

Click here to visit Strengthen Social Security ... don't cut it.

One more time: Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation.

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Posted by Dave Johnson at 8:47 AM | Comments (0) | Link Cosmos

August 10, 2010

Is It A Social Security OR A Deficit Commission?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Ever since President Obama set up the Deficit Commission all the talk has been about Social Security? Why?

Social Security is separate from the rest of the US budget, is separately funded, has a huge trust fund and, most important: Social. Security. Does. Not. Contribute. To. The. Deficit. Speaker of the House Nancy Pelosi said it best at Netroots Nation last month, calling it "apples and oranges,"

To change Social Security in order to balance the budget, they aren't the same thing in my view," the Democrat said today at the Netroots Nation conference in Las Vegas. "When you talk about reducing the deficit and Social Security, you're talking about apples and oranges."

So is it a DEFICIT commission or is it a SOCIAL SECURITY commission? If it is a deficit commission, then stop all of this talk about cutting Social Security, please, and start talking about the deficit. Everyone knows the deficit was caused by tax cuts for the rich and the huge increases in military spending that occurred under Reagan and then again under Bush II. (Note - there is no more Soviet Union.)

If you want to fix the deficit then get the money from where the money went. If you decide that it IS a deficit commission, it isn't hard to know what to do. (Please, click through, it's not hard.)

But instead, every day now, there is another round of attacks on Social Security. For example, this just in: Social Security, the trust fund and funny money, in today's Washington Post, talks about the Social Security Trust Fund as "funny money." The Trust Fund is all T-Bills. I would worry that the Chinese, Japanese and other major T-Bill holders are very, very nervous about talk like this. The Social Security T-Bills are the same T-Bills as theirs.

And this just in: Opposing view on retirement income: Let's upend Social Security, in today's USA Today by Dick Armey, who was one of the corporate-funded astroturf organizers of the Tea Party "movement." Let's take a closer look at some of Armey's arguments. He writes,

The nation's largest entitlement program is officially in the red.

No it is not. Not if you count the huge trust fund and the interest it receives from that. It is not "in the red" officially or even when you just make things up.

In less than 20 years, just two workers will be forced to pay the benefits of every one retiree.

This is not how Social Security works, and has nothing to do with anything. It's one of those made-up arguments that is designed to bamboozle people.

President Obama's deficit commission is considering an increase in both the retirement age and payroll taxes to "fix" the compulsory Social Security system.

True. But why? Social. Security. Does. Not. Contribute. To. The. Deficit.

Americans should ask, if Social Security is such a great program, why is it mandatory?

Because otherwise too many people wouldn't put anything away and would have to live on welfare, which the rest of us pay, instead of a good program that people pay into themselves.

Workers should have the choice about whether they want to remain in the current system or invest in a personal saving retirement account, which would allow them to have complete control over their retirements funds and pass the remaining balance to family members.

Because then you would have to know in advance how long you will live, which no one can do, in order to know how much to pay yourself each month from your savings. And, the money from people who die is used to give more to the people who live. Anyway, everyone already has the option to save outside of the Social Security program.

Anyway, it goes on like that, with trick after smooth trick being used to try to bamboozle people. Slick Wall Street salespeople like Dick Armey, Pete Peterson, and the rest are after our savings, and are using every trick in the book to fool us.

Here is the root of the attacks on Social Security: Social Security is the primary symbol of government of, by and, mostly, for the people. This is because it is a government program that works, works well, is solid, and has helped a lot of people! People who don't like government really, really don't like Social Security -- because it works.

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Posted by Dave Johnson at 5:12 PM | Comments (0) | Link Cosmos

Unpaved: Out-Of-Cash America Undoing Its Infrastructure

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

In case you missed Rachel Maddow last night, she had a segment on American cities and counties actually undoing their infrastructure because they are out of money. She listed city after city across the country that is shutting off its streetlights, turning paved roads into gravel, shutting down bus systems, shutting down schools, firing police, and other steps to save money.

To me, the most striking comment was, "Somewhere in China it is entirely possible that a businessperson sat down for a ride on a 200mph state-of-the-art levitating bullet train, and cracked open the Wall Street Journal, and read about how in American we've decided we can't afford paved roads anymore."

Is that how we want the rest of the world to think of us? Do we really want to become a broken-down, corrupt, uncompetitive 3rd-world country? Well, that is where we are going. We can see the infrastructure crumbling around us.

Meanwhile, as the country falls further and further behind the rest of the world the government is unable to function. In Washington the conservative Senate minority continues to use the filibuster -- over 110 times since President Obama took office -- to block every effort to do anything about our problems. They block helping states keep teachers. They block helping the unemployed. They block job-creation efforts. They block everything government does for We, the People.

And at the same time as they resist spending to help the country, publicly pleading that the deficit and debt are too high, the conservatives also resist doing the things that will fix the problem: raise tax rates on the wealthy, and cut the huge, massive, bloated, more than $1 trillion per year military and military-related budget.

They think a worsening economy with no solutions will demoralize enough voters that they can turn out their "base' and win in November. Destroy the economy and the country to get votes. Great. You'll make marvelous leaders -- oh wait, been there, that's how we got into this mess.

Yes, we know how we got here. Everyone this knows that the deficits and debt come from tax cuts for the wealthy, and huge increases in military spending. AConservatives know. They said their plan was to cut taxes and thereby "starve the beast" as a way to cut government. Their reason to cut government is to make way for the only available alternative: so that the large corporations and the wealthy can rule instead. Cutting government means cutting the controls and protections that We, the People have been able to build up over the years, ensuring that we get a slice of the pie. This has been going on for thousands, even ten thousand years, as the broad masses of regular people work to assert their rights over whatever wealthy and powerful group has seized the reigns of power and is trying to grab everything for themselves as fast as they can.

Look where this cynical strategy is taking the whole country! We are not only not maintaining and modernizing our infrastructure, we are falling into 3rd-world status. This can't even help the wealthy and the big corporations they control. The conservatives still have to live here even if this scheme does bring them control. They will still have to live with fewer police, fewer teachers, fewer streetlights, unpaved roads, crumbling factories, and an ever-less-competitive economy.

Will it be worth it?

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Posted by Dave Johnson at 11:06 AM | Comments (0) | Link Cosmos

August 3, 2010

Do We Need A Democracy Tariff?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

We need a Democracy Tariff, imposed at the border on goods that are brought in from countries where the people have not been able to build a strong democracy that protects their workers, wages and environment.

Yesterday in Exporting Jobs Is Not “Trade.” It Evades Democracy's Protections I wrote that ... well ... exporting jobs is not "trade." Packing up a factory here to send the jobs there, and then bringing the same goods that factory was making back here to sell is done for one and only one reason. It is done to get around the wage, safety and environmental protections that We, the People fought to build.

We formed this country and we fought to build protections that brought us a reasonably good life, and a middle class, and some security - social security - so we don't always have to be struggling and living on the edge of a cliff, surviving only at the whim of a wealthy few with all the power. We fought a revolution against government by a wealthy and powerful few, and we fought again and again to keep and protect government of the people, by the people and for the people.

Our wage, safety and environmental protections are the result of our democracy. We, the People fought and built a government to empower and protect us, to provide good wages and provide some security and that involves rules that limit what the owners of companies can do -- regulations. We build up a system of public structures like courts, laws, schools, roads, bridges -- spending -- that enable commerce to prosper. And we ask those who benefit from that commerce we enabled to share the return on our investment with us -- taxes and wages.

Democracy, government, regulations, spending, taxes. The stronger each of these are, the better We, the People do. The weaker they are, the worse off we are.

Lately wealthy corporate owners -- who benefit from the commerce that our democracy, government, regulations, spending and taxes enabled -- have found another way to get around these protections that We, the People built for ourselves. They move manufacturing and jobs to countries where the people have not been able to build strong democracies to protect their interests, and then bring the goods made by the exploited workers there back here to sell. They call that "trade" when really it is just a way to get around the borders that we are able to protect. As I wrote yesterday,

These workers make the same products that had been made here, sell them in the same stores here, but make them outside of the boundaries of our democratically-won protections. And to make things worse, the companies then demand wage and benefit cuts from the workers who are still here, claiming that "globalization" means they now have to compete with workers with no rights, so they must accept less.

There is a solution to this problem. These protections that we built brought us prosperity. And that means we have a strong market. Everyone in the world wants to be able to sell to us, and we can use that power to set the rules for access to our markets.

A Democracy Tariff

We should not let exploitation of workers and the environment be a competitive advantage that is used against the democratic protections we have built for ourselves. We can and should set a "Democracy Tariff" on goods that come from countries that do not protect their workers and/or environment. This tariff should be enough to offset the competitive advantage that comes from exploiting workers and the environment. If those countries do not change we can use the revenue from the tariff to build our infrastructure and strengthen our competitive position. If those countries do change, all the better, because as democracy strengthens there, the people will prosper and can trade fairly with us to buy things we make here. Everyone is better off when trade is free and fair.

There are degrees of democracy and there can be degrees of Democracy Tariff. For example, some countries might protect workers but not the environment. The tariff on goods from those countries should be enough to offset the advantage gained from exploiting the environment but not as high as for countries that exploit both workers and the environment. Other countries might have some degree of protections but not allow unionization. The tariff should be enough to offset whatever degree of exploitation is at work.

If a Democracy Tariff is called "protectionism" so be it. We have learned the hard way that democracy is fragile and must be protected.

We must not allow exploitation of workers and the environment to be a "comparative advantage" used against our democracy -- government of the people, by the people and for the people -- and the protections and prosperity it has brought us.

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Posted by Dave Johnson at 11:19 AM | Comments (1) | Link Cosmos

July 27, 2010

Shouldn't High Unemployment = Less Work To Do?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Simple question: have we reached a point where machines and computers leave us with less work to do? If so it can mean a lot of people are left without jobs and incomes, losing their homes and health, while the rest have our wages dragged ever downward. Or we can make some changes in who gets what for what, and every one of us ends up better off.

Cake or death? Which will it be? (*explained below)

Somewhere around one in five of us is un- or under-employed while at the same time so many of the rest of us, still employed are stressed, tired, doing the work of those laid off. With too few employed many stores, restaurants, hotels and many other businesses are falling behind. As Bob Herbert puts it today, "Simply stated, more and more families are facing utter economic devastation: completely out of money, with their jobs, savings and retirement funds gone, and nowhere to turn for the next dollar." The government has stepped in with stimulus to pick up some of the slack in demand but that can’t go on forever and we need to find long-term solutions.

Is it structural?

There are signs that the jobs crisis may now be structural, or built into the system. This means that the usual solutions are not going to "restart the engine" and trigger a return to an economy that had where almost everyone can find a job, (even if it is a menial, boring time-suck).

Our unemployment emergency may really be about less work to do. Hale "Bonddad" Stewart writing at 538.com, Labor Force Realignment and Jobless Recoveries concludes, (click through for gazillions of charts and full explanation)

The "jobless recovery" is in fact a realignment of the US labor force. Fewer and fewer employees are needed to produce durable goods. As this situation has progressed, the durable goods workforce has decreased as well. This does not mean the US manufacturing base is in decline. If this were the case, we would see a drop in both manufacturing output and productivity. Instead both of those metrics have increased smartly over the last two decades, indicating that instead of being in decline, US manufacturing is simply doing more with less.

So it may be that machines and computers are doing more of the work that people used to have to do.

Robert Reich sees signs of structural unemployment as well, writing in The Great Decoupling of Corporate Profits From Jobs,

... big U.S. businesses are investing their cash in labor-saving technologies. This boosts their productivity, but not their payrolls. [. . .] The reality is this: Big American companies may never rehire large numbers of workers. And they won’t even begin to think about hiring until they know American consumers will buy their products. The problem is, American consumers won’t start buying against until they know they have reliable paychecks.

So what do we do?

Maybe we need some changes in who gets what for what. Right now we have an economy that is structured to send most of its benefits to a few at the top, while the rest of us -- the help -- sink ever downward into less and less security. People with power and wealth benefit when they figure out how to cause other people to receive lower pay -- or just lose their jobs. Eliminating jobs brings bonuses to the eliminators -- a perverse incentive if ever there was one. If someone can figure out how to cut your pay and benefits or just get rid of you (“eliminate your position”) they get to pocket what you were making, and you get nothing (and conservatives say you're lazy). If you don't own the company you're out of luck.

In the past this perverse incentive was mitigated by people banding together in governments and/or unions and forcing the wealthy and powerful to share. But modern marketing science has been successful at making people believe that government and unions are bad for them. This was also mitigated by the ongoing need to find people to do the jobs that needed to get done. But with continual improvements in technology this need is reduced. We're living the result.

Also, this perverse incentive structure assumes an infinite pool of customers to sell to, ignoring that the transaction of benefiting from eliminating a job also eliminates a customer. But modern business has become so efficient at job elimination that this comes into play. Who will be able to buy theTVs that the employee-eliminating factory makes, if all the employees are eliminated and have no income?

These are structural problems that we can change. Let me just brainstorm a few possibilities for structural changes into the mix here:

Today when they replace a worker with a machine, the few at the top get another chunk of income, the worker gets nothing. But suppose a worker got to keep some of the economic benefit from getting laid off! Suppose that if your company replaces you with with a machine you get, say, 15% of the cost-savings as ongoing income. Heck, getting laid off would be a good thing, like winning a prize. After you get laid off a few times you only have to work part time. Get laid off enough times, you can retire.

Suppose we just shorten the workweek? What if we change from a 40-hour workweek to a 30-hour workweek? Economist Dean Baker has been offering ideas for workweek reductions for some time:

The other obvious way to provide a quick boost to the economy is by giving employers tax incentives for shortening their standard workweek or work year. This can take different forms. An employer who currently provides no paid vacation can offer all her workers three weeks a year of paid vacation, approximately a 6% reduction in work time.

Suppose the corporations and wealthy were taxed at the rate they were taxed before all the deficits and income inequality started, and the government just sent everyone a check, which served as a base income? Then everyone's wages would be higher because desperate people wouldn't be fighting over the few jobs. So then the better those at the top do, the better all of us do.

These are just a few ideas for restructuring the economy in ways the help all of us instead of just a few at the top. Please add your ideas in the comments.

We have a choice. We can continue with the system we have, and most of us -- the help -- will just get poorer and poorer while a few at the top take home more and more. Or we can change who gets what for what, and everyone comes out ahead.

*So which will it be, cake or death?

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Posted by Dave Johnson at 1:52 PM | Comments (3) | Link Cosmos

July 22, 2010

Republican Plan Working So Far

The plan: Block everything Congress does, then run against Democrats as ineffective.

What they have done: Blocked almost everything so far.

Triumphant headline today at Drudge Report:
PACK YOUR BAGS: CONGRESS CONFIDENCE AT 11%

Why aren't the Senate leaders making everyone stay on cots until filibusters end?

Will the President use his Constitutional power to make the Senate stay in session through the summer to hilite to voters what has been going on? That would be called governing.

Posted by Dave Johnson at 8:21 AM | Comments (0) | Link Cosmos

July 20, 2010

President Obama, Make Congress Stay In DC Until They Pass Jobs Legislation

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

The Constitution of the United States, Article II, Section 3: "He may, on extraordinary Occasions, convene both Houses, or either of them..."

We have a jobs emergency and the Congress has not acted. Almost everything the Senate does is being blocked by an obstructionist minority that is trying to tank the economy, hoping a demoralized public will blame the other party and won't bother to vote, which will help them take power in November.

The government is not governing and the consequences for working (and out-of-work) people are severe. Millions of unemployed are not finding jobs. People can't pay their mortgages or rent and are losing their health care. Small businesses are reaching the end of their ability to hold out. Communities, even whole states are out of money to cover even basic services.

The President has the the power to do something about this. He has the power to show the public where he and his party really stand on doing something about the jobs crisis. He has the power to show that he can put his foot down and demand action.

The Congress is planning to go on recess in August and the President has the power to make them stay until robust jobs legislation is passed.

This is an opportunity to apply pressure to get badly-needed job creation and further stimulus underway. This is an opportunity to show the public who is acting and who is blocking. This is an opportunity to clarify for the voters who is working to get jobs going and who is keeping the Congress from acting.

The President has the opportunity to lead. He has the opportunity and the responsibility to govern.

This is an emergency. Make them stay.

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Posted by Dave Johnson at 9:51 AM | Comments (0) | Link Cosmos

July 14, 2010

Against All Odds: Save the Middle Class and the American Dream

The American Dream is what is at stake for the Obama Administration, and they know it. This is the dirty, little secret that can longer be contained -- it is escalating, cannot remain hidden, and may have significant political ramifications for the 2010 elections. The atrocity of the past years is this broken promise with the people, and it is deeply affecting the way they think, behave, vote and live. Moreover, it could begin to explain the groundswell response to candidate Barack Obama in 2008. The power of his words helped them believe that the dream was recoverable. He exemplified what was possible through education and hard work in his meteoric rise through American politics to the Oval Office. Further and more importantly, it also explains why we are now suffering such profound political despair reflected in the dropping poll numbers.

The middle class, for its survival, needs life to return to a semblance of "normalcy" - a time when they didn't know how to spell the word "deficit" and didn't have to care. They want their retirement savings back so they don't have to work until they drop. They want a bank account that makes more then one percent interest. They want to know what their health insurance premiums will be this year and in ten. They want to know if their kids study, and if they save and sacrifice, that their lives will be better. They want their kids to get good jobs, and they want to hold onto our own jobs. And with despair and anger they realize that despite the heroic work of the Congress with this President in passing landmark legislation in all of these areas -- they still are not safe. Economic ruin may still be right around the corner, and makes it hard to sleep at night.

You know we've all been hoodwinked and sold a bill of goods about the sanctity of the middle class in this country. It is a basic tenet of our lives, and made us different from other countries. The ranks swelled over the last decades after FDR to the present. But now for the first time since the Great Depression, the middle class is at risk of tipping over once and for all. They are not coming out of the financial, housing and environmental crises intact. Interest rates have ratcheted up on the family home, maybe there's a balloon payment on the mortgage and its impossible to refinance under the "new" programs; savings have virtually no interest and are drying up; pensions have evaporated; health insurance premiums are basically unaffordable until 2014 if then; schools are overcrowded and on the decline; there are no jobs except in China and they don't speak Mandarin; and unemployment is still at 9.5% -- higher in key areas throughout the country. The new legislation is riddled with loopholes, as all legislation can be after laborious compromises and extensive details. What is different is that each of these loopholes is flagrantly being exploited by the banks, the credit card companies and the health insurance companies. For example, many of the unemployed cannot qualify for COBRA because their companies failed which is code for closed their doors. COBRA is not available when a company terminates their health insurance plan, and 2014 is a long way off when you need health insurance coverage now.

Frankly, this is not what the middle class signed up for. It was not part of the implicit promise made to them. As a result, they are angry (enter stage right the Tea Party to exploit this vulnerability), and depressed (evidenced in the lackluster June election voter turnout). This is a deadly combination that could seal the deal on the November elections for the big, bad guys. Yet somehow the middle class and its Democrats must rally again and rise above the collective depression (no pun intended). We cannot let the brilliant and effective message machine of the Republican Party lull them into universal amnesia -- forgetting all the wrongs of the past. Remember these are the same guys (Bush and Cheney) that put the nails in the coffin cementing the potential extermination of the middle class. These same guys two weeks ago even blocked the extension of unemployment benefits while they frolicked on vacation. How could they do that to working families in this country? The extension passed the House before the break, but was filibustered in the Senate. And given all that, imagine life when we essentially give away the House because we are too depressed to vote or disorganized to keep these seats.

I will take liberal Speaker Nancy Pelosi any day over anti-choice, sanctimonious Republican Representative John Boehner as Speaker of the House. That would be a bad dream that just keeps on giving. This threat should be enough for the White House to saddle up and come out with a plan, a message (remember "hope and change"), and leadership to deliver - not the White House Press Secretary Gibbs message yesterday. David Gregory of Meet the Press has gotten so very good and Gibbs just walked into a fiasco announcing the potential lose of seats in the House. It was as bad as giving away candy instead of feeding the homeless, and maybe that's why White House Special Advisor, David Axelrod, was so snarky with CNN's Candy Crowley during the next hour on the Sunday morning political shows because it sure didn't make any sense.

Snarky or not, we all know Obama and his team are awful busy with the economy, the oil spill and a few dozen Russian spies, but we need them to reach out to that disenfranchised middle class again, aka big voting block. After all, Obama is the master communicator and we know that he can do it because he has done it before to win in 2008. And now the stakes may even be higher. If we allow 40 seats in the House to go asunder and a few more in the US Senate -- we can start waving bye-bye to the American Dream, the middle class, economic recovery, and maybe the Supreme Court for the next couple of decades.

Please see my Pearltree for some of the reference materials with more to come. This is a new tool to organize and share materials on the web. In full disclosure, I advise them as they build out the new features of this platform.

Note, an earlier version of this article appeared this week on the Huffington Post.

Posted by Michelle at 1:32 PM | Comments (0) | Link Cosmos

Obama Didn't Deliver

What Digby Said! Winning Isn't Everything, It's The Only Thing,

... the party in power is expected to do what's necessary to pass its agenda. If it can't, it is held responsible for the failure, not those who stopped them from doing it.

There are SO many things Obama and the Dem leadership could have done.

Obama and the Dems weakened the stimulus "to attract Republican votes." When they didn't get any Republican votes, they left the compromises in anyway! They did this time after time since.

Obama could have kept the Congress in session last summer until they passed health care reform.

The Senate could have "rolled out the cots" every single time the Republicans filibustered. The one time they did do this Republicans immediately caved. Why didn't they keep doing it?

Senate leadership has to decide whether to keep letting Republican just block everything, or do what it takes to get things moving. They can do this, and are choosing not to.

It is time to govern the country. It is time to get things done. Or get out of the way -- the people, the unemployed, those without health care, communities losing factories, states laying off hundreds of thousands, all are depending on you to get the job done, not accommodate right-wing kooks.

Posted by Dave Johnson at 12:24 PM | Comments (0) | Link Cosmos

July 13, 2010

Wait, Who Said We Want Less Government Protecting And Empowering Us?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Cut spending? Wait - where did that terrible idea come from? Government is We, the People and its job is to protect and empower us. Why in the world would we want to cut back on that?

WSJ today, The Bush Tax Cuts and the Deficit Myth, "Runaway government spending, not declining tax revenues, is the reason the U.S. faces dramatic budget shortfalls for years to come."

Wait a minute. Back up. Where did this come from? Who, anywhere, any time agreed to cut government? Why do We, the People allow these anti-government zealots to pre-frame the budget deficit as a problem of government doing too much for us? Which government function is the "too much" part? Reigning in runaway corporations? Consumer protection? Worker safety inspections? Food safety inspections? Maintaining and modernizing our infrastructure? Educating people? The courts? Keeping the water and air clean? There is a long list of things our government does for us. Why would we want less of that?

Imagine if Democrats voted to just put $500 billion a year in rockets and shot the rockets at the moon, and spent the next 30 years demanding that conservatives do their part and raise taxes to pay for that. Do you think the top 1% would just say, "OH, OK, let's do that." Of course they wouldn't.

But under anti-government conservatives all of these things that our government does to protect and empower us were cut to the bone or just ended, resulting in mine disasters, bank meltdowns, predatory corporations scamming all of us, and the BP oil spill. We, the people got poorer and less secure while the rich got really, really richer.

Why would anyone in their right mind think that was a good idea?

Conservatives cut taxes on the rich, resulting in the greatest concentration of wealth ever. The entire economy turned into an everything-to-the-top vacuum cleaner scheme, filled with scams shaking down and fleecing We, the People of everything we have and delivering it to a few wealthy corporation-owners. And then we get this bamboozlement that "the deficit" is out of control, so we have to cut back on anything that remains of government working for We, the People? I don't think so.

Think about the level of bamboozlement that is going on here. Conservatives cut taxes on the rich, and then spend the next 30 years saying, "OK, now you have to do your part and cut the things government does for the people." The whole thing was a scheme to deliver power to a few at the top. In Reagan Revolution Home To Roost: America Drowning In Debt you can see the step-by-step outline of the plan, in their own words. The deficit plan was right there for everyone to see:

• Step 1: Cut taxes to "cut the allowance" of government so that it can't function on the side of We, the People. Intentionally force the government into greater and greater debt.
  
• Step 2: Use the debt as a reason to cut the things government does for We, the People. When the resulting deficits pile up scare people that the government is "going bankrupt" so they'll let you sell off the people's assets and "privatize" the functions of government. Of course, insist that putting taxes back where they were will "harm the economy."
  
• Step 3: Blame liberals for the disastrous effects of spending cutbacks.

So when did We, the People agree to this one-way bargain, cut taxes for the rich and cut what government does for us? We didn't, and we should stop acting like we did.

Every single one of us knows that the deficits are the result of tax cuts for the rich and huge military spending increases. If we want to fix the deficit problem we know exactly what to do.

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Posted by Dave Johnson at 9:01 AM | Comments (0) | Link Cosmos

May 27, 2010

"Government Doesn’t Have The Resources To Stop It"

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

People want the President to exert leadership to turn things around.

The oil leak. Unemployment. Credit card scams. Foreclosures. Predatory corporations. Environmental destruction. Global warming. Roads and bridges crumbling. Incomes stagnant. Schools getting worse. Companies moving overseas. Problem after problem.

People want to know, "Why doesn't the government push BP aside and take over?" The answer is, "Government doesn't have the resources to stop it."

People want to know why the government can't do more to help unemployed people, help with health care, help provide good educations, help with college, maintain the infrastructure, and all the other things that government does.

The answer, these days, is always, "Government doesn't have the resources." And that, in a nutshell, was exactly the plan.

We, the People no longer have the resources to solve our problems. We now must depend on and defer to the corporations and the wealthy few to make the important decisions and get things done instead of being able to decide and do on our own.

This is the legacy of 30 years of conservatism. They called it "starving the beast." Reagan called it “cutting their allowance.” President Bush, told that his policies had turned the country back to massive deficits, said this was, "Incredibly positive news'' because it will create "a fiscal straitjacket for Congress." He came into office with a $236 billion surplus. His last budget left us with a $1.4 trillion deficit. "Incredibly positive news."

They disemboweled the regulatory agencies. They "privatized" government functions and resources, letting a well-connected few profit at the expense of the rest of us.

The Reagan deficit plan was right there for everyone to see:

Step 1: Cut taxes to "cut the allowance" of government so that it can't function on the side of We, the People. Intentionally force the government into greater and greater debt.

Step 2: Use the debt as a reason to cut the things government does for We, the People. When the resulting deficits pile up scare people that the government is "going bankrupt" so they'll let you sell off the people's assets and "privatize" the functions of government. Of course, insist that putting taxes back where they were will "harm the economy."

Step 3: Blame liberals for the disastrous effects of spending cutbacks.

And here we are. Every time you hear someone say that we have to fight the deficit instead of getting things done that We, the People need done you are witnessing The Plan in action.

And now, government doesn't have the resources to stop it.

NOTE: Part of the America's Future Now conference in Washington D.C. from June 7-9 will be devoted to strategy on how the progressive movement can fight the deficit cutters. Speakers such as Van Jones, House Speaker Nancy Pelosi, Howard Dean, AFL CIO President Richard Trumka, Arianna Huffington will offer a build vision for how the progressive movement can rebuild America's economy and put people back to work. Click here to attend.

Posted by Dave Johnson at 10:40 AM | Comments (0) | Link Cosmos

May 24, 2010

How Much Oil? STILL No Answer?

Has the government stepped in and demanded measurements of how much oil is coming out of that hole in the floor of the ocean yet?

No? We still don't have a government?

As I wrote in February,

But my own gauge of a return to actual governance by rule of law is when I open my morning paper here in Silicon Valley and see that the government is going after a few companies for age discrimination. Never mind prosecuting people for torture, illegally invading a country, crony capitalism, or destroying the country. No, I'll believe that radical change is beginning when they are willing to take on something so blatant , obvious and wrong as the firing of people when they reach 40 or so that is going on here in front of everyone's eyes out here.

And back in September

I ask because I have not heard of any new enforcement of employment regulations here in Silicon Valley. For example, in the rare cases where any hiring is occurring, is the government checking to make sure that the rampant age discrimination has stopped? Are they making sure that women are paid the same for the same jobs? Are they going after companies that pollute? etc?

Nope, still no functioning government.

Posted by Dave Johnson at 8:31 PM | Comments (0) | Link Cosmos

April 19, 2010

Distrusting The Government

Hey, that could be a good blog name, like Seeing the Forest, Smelling the Coffee and Growing the Garden.

A Pew Poll says Distrust in Government Skyrockets.

If you look at the poll you find that trust in government tends to drop through Republican administrations, and then rises through Democratic ones.

Also, there is a huge, well-funded anti-government effort out there with dozens of corporate-funded think tanks, an entire TV network, and all of talk radio. All the time, 20 hours a day, telling the public that government and democracy are bad, and corporations should run things. Marketing works, so I'm not surprised by these results.

One last point. Reading the poll - 142 pages - one thing runs through it. People don't see what government does for them anymore, and thinks that interests - especially the banks right now - are who the government is representing. I think some of that is people taking much of what the government does for granted, like roads, bridges, police, etc. I think some of it is that a huge amount of the spending is on things like military -- currently more than a $trillion for everything related to the military budget -- and interest on the Reagan/Bush debt.

Posted by Dave Johnson at 1:30 PM | Comments (0) | Link Cosmos

April 17, 2010

Tax Tricks - Do Corporations Pass Taxes On To Customers?

Here is a tax trick you hear all the time: we shouldn't tax corporations because they just "pass the taxes along to customers." Go to any of the usual anti-tax, anti-government sites and you'll see them trying to trick people with this.

First of all, if companies really did "pass taxes along to consumers," so what? Is that a reason not to pay for the roads, bridges, schools, courts etc., that enable the company to be profitable enough to pay taxes? But actually they don't -- because they can't.

This tax trick is based on a popular assumption that businesses can just raise prices whenever they want to. But a well-run business is already charging what they should charge for their product or service. If they have room to raise prices they should already have done so. But of course doing so this will cause them to lose sales to competitors.

Taxes are on profits, and profits are calculated at the end of a tax year by adding up all the revenue and subtracting all the costs. When a product or service is sold the company doesn't really know yet how much profit, if any, it will have at the end of the year, so it doesn't know what the tax will be, so how can it adjust prices? But if a company was able to just raise prices based on anticipation of profits, then the result would be that profits would be higher because of the higher price charged, which means taxes would be even higher, so the company should have raised prices even more, but that means the profit would be even higher, so they have to go back and charge more, but then ... I think you are starting to see how silly this idea of raising prices to cover taxes can get.

About those competitors - if one company is doing well and therefore making a profit, and another company is not doing so well, and therefore not making as much profit, and the first company raises prices to cover the taxes on the profit, then the second company has a price advantage so the first company loses sales and isn't going to have a profit after all so they really should put the prices back down, but then the other company's price advantage goes away and they are making a profit again so they should raise prices but ... Hey, this just gets silly, too!

Companies do not pass on taxes to their customers. So don't fall for this tax trick, it's just silly.

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF. Sign up here for the CAF daily summary.

Posted by Dave Johnson at 1:05 PM | Comments (1) | Link Cosmos

April 16, 2010

What Conservatives Mean By "Freedom" and "Big Government"

This post originally appeared at Speak Out California.
Many of us have wondered what conservatives mean by terms like "big government" and "freedom." Today the vice chairman of the California Republican Party gives us a hint. In Constitution guarantees freedom, not a cushy life, published in the Rev. Moon's Washington Times (do Christians know he's writing there?), Thomas G. Del Beccaro writes,

   

Today, politicians literally speak of the "rights" of people as they attempt to guarantee a certain standard of living for their constituent-subjects. Of course, most recently, the federal government took on the role of guaranteeing that Americans had a minimum standard of health care because, to the government, it was a right - however unenumerated. 

Now, it would be one thing if a government could actually guarantee such standards of living, but it cannot. After all, before the Great Society was enacted to take on the War on Poverty, the government-measured poverty rate was 14 percent.The pre-Great Society federal budget was less than $130 billion.Since then, we have spent tens of trillions of dollars in good intentions and have a nearly $4 trillion budget, yet the poverty rate remains virtually the same 14 percent. 

 In the process, of course, we have diminished freedoms immeasurably - whether by forcing people to pay for those trillions or by being forced to be subject to government rules....

So "big government" means more rights for Americans, like the right to health care. And by "freedom" he means not being "forced" to help out other Americans. (Of course, the poverty rate was much lower before conservatives took over the government a few years back...) 

Conservatives opposed civil rights for women, minorities, and now gay people. They opposed and fought to the last against Social Security, Medicare, unions, public schools, libraries, parks, worker safety rules, food safety riles, consumer safety rules, bank regulation, even public health programs. These are the "cushy life" big-government programs he complains about. And by "freedom" he means not pitching in to pay for things like roads, bridges, education. 

Government is We, the People watching out for, empowering and protecting each other. It means WE make the decisions and "big government" means WE make decisions that help US. Think of the alternative to We, the People making the decisions and you will realize what opponents of government are pushing for. 

 Apparently conservatives want us all to be disposable economic units with no value beyond what we are able to consume and how much money we make for the wealthy few.

Posted by Dave Johnson at 1:44 PM | Comments (0) | Link Cosmos

March 27, 2010

After Waiting 14 Months Obama Finally Chooses To Show Up, Govern

After being in office for 14 months President Obama is finally, finally, finally, finally, finally, finally choosing to begin to govern the country. Today, for example, he finally, finally, finally, FINALLY decided it would be a good idea to put a few people into vacant offices. See President Announces Fifteen Recess Appointments, Including Craig Becker,

The President today announced recess appointments for fifteen nominees who have been waiting for confirmation in the Senate for an average of 214 days. Included in those nominees are two members of the National Labor Relations Board, which has been non-functional without a quorum for over two years.

Of course, this is only putting 15 appointments into vacant positions when there are literally hundreds of vacancies. But heck, it's something, after months and months and months and months of nothing.

Here is what is going on. President Obama is way behind in nominating people to vacant posts and judgeships. On top of this the Republicans have used the filibuster to block many of the candidates that Obama has nominated. In the case of the Labor Board there were only two people left serving on the 5-member Board when 3 are required to make rulings, and some 600 cases have backed up.

The President has the power to make what are called "recess appointments" which means he can just put people into many of these vacant slots when the Senate is not in session. Such use of legitimate power to make the government operate as it should is also known as "governing." Until today he has refused to use this power to get the government operating. Today he finally, finally, finally, finally put 15 people into positions where they can start getting their agencies operating.

Finally.

A couple of weeks ago, after a year of delay that enabled Republicans to almost start a civil war, the President finally showed up and started working to get health care passed, and today it is law. Of course, the President didn't fight for a public option -- he was afraid that Republicans would call him a Socialist if he did --so instead he fought for a Republican-originated plan to make us all buy insurance from the monopolistic insurance giants that have been ripping us off. But at least that kept him from being called a Socialist.

So maybe the President will learn that actually showing up and fighting for something is a good way to get things done. Maybe. We'll see.

Posted by Dave Johnson at 1:47 PM | Comments (0) | Link Cosmos

March 6, 2010

Conservatives Caused Huge Deficits, Blame Obama

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

Headline at Drudge Report: Obama policies projected to add $9.7 trillion to debt by 2020... points to this story, National debt to be higher than White House forecast, CBO says,

President Obama's proposed budget would add more than $9.7 trillion to the national debt over the next decade, congressional budget analysts said Friday. Proposed tax cuts for the middle class account for nearly a third of that shortfall.

So here is the deal. This Drudge headline, saying Obama's spending "adds to the deficit" is a trick. Here is how it works. Suppose you take over a company that is losing $100 million a year, and your jobs is to turn it around. So perhaps the second year the company only loses $70 million, $30 million the third year, and breaks even in year four. You saved the company. But in those years the company "lost" another $100 million. Should you be fired?

President Obama took office as President of a country with a $1.4 trillion deficit - thanks to the failure of conservative policies. Their tax cuts, wars, military buildups, corruption and incompetence drove the borrowing WAY up, and then their deregulation, corruption and incompetence destroyed the economy, driving the borrowing up into the stratosphere.

If the borrowing just stayed the same at the $1.4 trillion level Obama inherited each year -- never mind that interest on all that borrowing gets higher and higher each year -- that would mean $14 trillion would be added to the deficit by 2020. That's a LOT more than the $9.7 trillion that Drudge and the conservatives are making so much noise about. Obama is dramatically reducing the borrowing, but they use trickery to make it look like he is causing it.

What about that $1.4 trillion deficit? That was the deficit for the 2009 budget year. Conservatives say -- over and over -- that Obama "tripled the deficit" in 2009. This isn't even a trick, it is just a lie. The final Bush budget year ended with a deficit of $1.4 trillion. Conservatives have been telling the public this was an "Obama Deficit" and use graphics and charts that label this last Bush budget as Obama's. Look at that chart, and then look at this. The first chart is nothing more than a lie, of course repeated endlessly.

But what else should you expect? Like the scorpion that stings the frog as the frog ferries it across the river, it's what they do. They screw things up, and then point the finger of blame at everyone else.

Posted by Dave Johnson at 9:57 PM | Comments (2) | Link Cosmos

February 23, 2010

California Closed

GO HERE: Meg Whitman's California

Posted by Dave Johnson at 5:18 PM | Comments (1) | Link Cosmos

February 21, 2010

Create Real Jobs That Pay Off: Update Our 1970'S Infrastructure

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

One legacy of the Reagan tax cuts is that we stopped maintaining - and never mind modernizing - our infrastructure. As a result there is a LOT of work that needs doing. And there are a very, very large number of unemployed people. Hmmm...

There are so many more ways our economy suffers as the consequences of Reagan-era choices come home to roost. The current economic doldrums are in great part the result of Reagan-era choices:

* The deferred infrastructure maintenance and modernization that resulted from the tax cuts mean that our economy is no longer world-class. Bob Herbert has been writing about this problem for a while. From his most recent,

Schools, highways, the electric grid, water systems, ports, dams, levees — the list can seem endless — have to be maintained, upgraded, rebuilt or replaced if the U.S. is to remain a first-class nation with a first-class economy over the next several decades. And some entirely new infrastructure systems will have to be developed.

So here we are with a massive infrastructure deficit that is harming our ability to compete economically in the world. Just one example: China has 42 high-speed rail lines coming into operation connecting their major cities, and we are just starting our first one connecting ... Tampa to Orlando?

* The education cutbacks then are really hurting now.

* Energy. Cancelling all of Carter's efforts to solve our energy problems has left the economy dependent on last century's expensive and polluting energy sources and the monopolistic giants that control them.

* Debt. Tax cuts creating "structural deficits" have built up tremendous debt and the accompanying burden of paying interest on that debt and dependence on those who fund our borrowing habit.

* Militarization. We spend more on military than every other country on earth combined. The big defense corporations keep us from doing anything about it. Historically this kind of military spending and the resulting debt has ruined empires and kingdoms, and here we are.

* Government. Outsourcing/cutting/destroying/hating government and the commons has left us ill-equipped to catch up with China and others, and deal with monopolistic multinational corporate giants.

Schools, highways, power grid, ... everything. And all this work needs to be done on top of the need to retrofit all of our country's buildings to be energy efficient. Or we will just continue to fall forther behind. There is so much work that needs to be done. I wonder how the cost compares to the amounts that have been transferred to the very rich since the tax cuts started.

Hmmm... Let's see ... high unemployment ... lots of work that needs doing ... massive wealth accumulated at the very top ... hmmm... dot. dot. dot. And on top of that, there is all that evidence that past investment in infrastructure leads to great prosperity in the years following the investment ... dot. dot. dot. hmmm... Ideas are forming... connections are being made...

I can hear the shrieking from the "free market" conservative bunch now, just for thinking such thoughts: "But ... but .. that would be just WRONG to just ... give people jobs doing what needs to be done!!! and taxing the RICH -- the very beneficiaries of past infrastructure investment -- to pay for it? How can you even dare suggest such a thing???!!!"

Public works projects -- infrastructure. Example: In the 1950s, with top tax rates at 90%, we started the massive public works project that is the Interstate Highway System. How did that investment work out for our economy? How many companies benefitted from the ability to deliver trucked goods across the country in a short time? How did those top taxpayers do economically as a result of such investments?

Hmmm...

Posted by Dave Johnson at 12:12 PM | Comments (0) | Link Cosmos

February 1, 2010

SOTU - A List Not a Vision

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

In last week’s State of the Union speech President Obama talked about jobs. It was a great speech. It was SO satisfying to see him scold the Supreme Court for enabling monopoly corporatocracy to replace democracy, scold the Republicans for obstructing every single bill, and scold Democrats for being chickens**ts and running for the hills. But in the end he presented a laundry list – a good list, but a list – instead of a vision for a new economic structure.

First, he summarized the effects of the “stimulus,”

“Because of the steps we took, there are about two million Americans working right now who would otherwise be unemployed. Two hundred thousand work in construction and clean energy; 300,000 are teachers and other education workers. Tens of thousands are cops, firefighters, correctional officers, first responders.”

Then the jobs list:

• “I'm proposing that we take $30 billion of the money Wall Street banks have repaid and use it to help community banks give small businesses the credit they need to stay afloat.”

• “I'm also proposing a new small business tax credit-– one that will go to over one million small businesses who hire new workers or raise wages.”
• “let's also eliminate all capital gains taxes on small business investment, and provide a tax incentive for all large businesses and all small businesses to invest in new plants and equipment.”

• “put Americans to work today building the infrastructure of tomorrow . ... There's no reason Europe or China should have the fastest trains, or the new factories that manufacture clean energy products.”

• “put more Americans to work building clean energy facilities…”

• “and give rebates to Americans who make their homes more energy-efficient, which supports clean energy jobs.”

• “it is time to finally slash the tax breaks for companies that ship our jobs overseas, and give those tax breaks to companies that create jobs right here in the United States of America.”
  

On Exports - Also A List

• “we need to export more of our goods”

• “a new goal: We will double our exports over the next five years, an increase that will support two million jobs in America.”

• “launching a National Export Initiative that will help farmers and small businesses increase their exports”

• “seek new markets aggressively, just as our competitors are”

• “enforcing those agreements so our trading partners play by the rules”
  

What’s missing?

The most important jobs item missing from the President's speech was aid to states. The problem is that the states are cutting their budgets, which means layoffs and cutbacks from maintaining their infrastructure and investing in new infrastructure. With this happening in many of the 50 states, the scale threatens to undo the positive effect of the stimulus.

But President Obama faces two problems when considering aid to the states. First, helping the states would mean even more borrowing, on top of the borrowing forced on us by the years of conservative policies. Second, many of the troubled states are in their predicament because of their own conservative anti-tax policies. California, for example, is cutting jobs because the conservative minority is able to block any revenue-raising measures, and last year was even able to force even more corporate tax cuts in exchange for letting the state pass any budget at all.

But maybe Oregon is showing other states the way out of this trap. Last week voters raised taxes on corporations and the wealthy. Oregon voters pass tax increasing measures by big margin,

Oregon voters bucked decades of anti-tax and anti-[government] sentiment Tuesday, raising taxes on corporations and the wealthy to prevent further erosion of public schools and other state services.

If the people in the states rise up and start demanding that the wealthy and corporations pay their fair share, they can dig themselves out of this mess.

Buy American

Another path out of the jobs mess is to include Buy American procurement clauses in stimulus, infrastructure and jobs bills. A report by Alliance for American Manufacturing, titled, Buy America Works: Longstanding United States Policy Enhances the Job Creating Effect of Government Spending argues for a strong “Buy American” clause in the new jobs bill.

“Including domestic sourcing requirements in job creating legislation would be the most effective way to ensure taxpayer dollars are used to create and maintain jobs and manufacturing capacity to the maximum extent possible, thereby vastly improving the stimulative effect of government spending.

[. . .] Given the dire problems the economy has experienced and continues to experience, the inclusion of domestic sourcing requirements in an upcoming job creation bill is the smart thing to do.”

Reinforcing this, a recent Gallup poll finds that Americans think the “best way to address the problem of growing unemployment in the United States [is] … to keep manufacturing jobs in the U.S.”

Keep Jobs Here

Bloggers have pointed out that the job-creation tax credit doesn’t prohibit offshore outsourcing of the jobs that receive the tax credit! Come on people, this is pretty basic.

Finally, Tell The Senate: JOBS NOW!

Campaign for America's Future is reaching out the 27 million Americans who have lost their jobs and are scrambling to get by – and the rest of us who know them and stand with them – to contact their Senators and say: Tell the Senate: We need action on jobs NOW! Click here to take action.

Posted by Dave Johnson at 11:39 AM | Comments (0) | Link Cosmos

January 9, 2010

Will Supreme Court Rule For One-Dollar-One-Vote?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.

The Supreme Court could say as soon as Monday that corporate executives are free to use huge amounts of corporate resources to directly influence elections. The vote will probably be 5-4 and we know which 5 and which 4 and why.

If this happens it will fundamentally change the way our elections are decided, our leaders are chosen, and our laws are made. The ruling will complete the transition, already underway, from a one-person-one-vote ideal to a corrupt one-dollar-one-vote system run for the benefit of those with the most dollars to throw into elections. And of course those with access to the most corporate dollars will use their new influence to increase their own dollars - and influence - at the expense of those with fewer dollars. Monopoly capitalism will be the New World Order.

It is simple to imagine how unlimited direct use of corporate resources will change our lives. Just for example, suppose executives at a chemical company want to save money by dumping toxins into a nearby river. Suppose a county or state government is trying to block this. Imagine the effect unlimited direct corporate money can have in a county or even a state election. Of course those executives will be able put in place a local or state government that lets them dump into the river. They probably will be able to get laws passed preventing their company from being sued for the resulting cancers. I know that this sounds pretty darn close to the political system that we have today but with direct use of corporate resources to influence elections the corrupting influence will be much more direct and corrosive.

This is not what some call corporatism and is not about companies making decisions, because companies don't think or make decisions. This is about executives -- people -- at the helm of huge, powerful companies using the company's vast resources to benefit themselves. This is at the expense of people in other, smaller companies. It is so important to understand that it is done by people - executives using corporate resources because companies are not sentient entities, no matter what anyone says. They don't think and they certainly don't speak. And it isn't everyone in these companies. The people in Sales or Accounts Receivable don't make the decisions, a few people at the very top do. In order to address this problem we need to understand that the actions of corporations are really the actions of a few people. Corporations don't act or "do" anything, people do.

This is about monopoly capitalism. Of course executives in control of the biggest companies will use their financial power to consolidate their control over our system, for their personal benefit. Smaller companies in the same industries and startups that threaten to compete won't stand a chance because the rules will be bent against them. If you think the oil and coal companies are hampering efforts control CO2 emissions and foster new alternative energy sources now, then just wait until the resources of giant companies are allowed to directly control our elections and therefore our government. If you think giant pharmaceutical companies are getting favors like unlimited patent life now, just wait until the Supreme Court opens up direct use of corporate resources.

So how did we get here?

It is difficult if not impossible for individuals to raise sufficient capital to enable large-scale projects that can cost millions, even billions to get started. So we developed corporations which areprivate legal entities designed to pool individual resources and accumulate vast sums, far beyond the ability of individuals to gather. The corporate legal structure enables large numbers of people to contribute to an effort. This also spreads the risk. Even if someone could raise the kind of money it takes to design and build a 747, why put all the eggs into one basket?

This legal structure was developed and is supported by our laws to benefit all of us. In fact, we even grant "limited liability" to the investors in corporations to encourage their development so investors are not responsible for the debts of a corporation. This is just one of many benefits granted to corporations by we, the People. We set up this structure to benefit us - why else would we have done it?

These pooled resources are supposed to be used only for business purposes, and the businesses are supposed to operate on a regulatory playing field that is set up by us. Corporate executives are only supposed to use corporate resources to run the business for the benefit of the shareholders. Some argue that use of their company's money to influence the political system brings benefits back to the companies thereby benefiting the shareholders. But in this example influence comes with an expectation of gain which is just bribery and is therefore illegal. On the other hand, some claim that these companies only have our best interest at heart, and expect nothing but good government in return for their largess. Of course without direct corporate gain this use of corporate funds by executives is a waste of shareholder's resources, and is therefore theft. Bribery or theft, which is it? Either way it is wrong.

Democracy developed in reaction to corrupt rule by wealthy and powerful interests for their own benefit at the expense of the rest of us. So it was recognized from the beginning that such pooled resources are a danger to the democracy we fought so hard to develop, and rules were put in place to prevent this from happening. But like the smallest leak in a dam, any use of corporate money to gain influence of course turns into greater and greater influence. The first bribe led to greater resources to use for a larger second bribe, and so on. As each bribe increased the influence of a wealthy corporate few eventually we ended up with a political party entirely dedicated to furthering the control of that wealthy few, to the point of appointing Supreme Court justices dedicated to that end. And here we are.

What can we do about this?

First of all, if by some miracle the Supreme Court doesn't open up direct use of corporate resources in elections we must recognize how close we have come to losing democracy, and stop all use of corporate resources to influence not just elections but public attitudes as well. Even without the Supreme Court opening things up, we have been heading down this path for some time. We have to stop corporate resources from leaking out of the companies and affecting corporate rulemaking. This includes lobbying, which is really just bribery. Company resources will always be used to bring advantages to that company -- over other companies and the rest of us.

If the governmental systems come entirely under the control of a wealthy few with access to the resources of giant corporations we are in a heap of trouble. But we have been here before, a century or so ago. A strong progressive movement can turn things around. We will need to develop strong public outreach from progressive organizations to help the public understand what is happening,. We will need to support labor unions as they fight to restore the ability of people to make a living and have some power and control over the workplace. And we will need to help people learn to fight the propaganda that is and will be thrown at us 24 hours a day.

Posted by Dave Johnson at 1:35 PM | Comments (1) | Link Cosmos

January 7, 2010

Why Is Moving A Factory Called "Trade"?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

I have a simple question: Why is moving a factory across a border called "trade"?

The process of building up a country is long and difficult. People over time unite and engage in a long, hard struggle to form a democratic government for themselves and build strong public structures -- a system of laws, environmental protections, wage and hour rules, worker protections, product safety standards, etc. -- all of which work to raise the standard of living for everyone. These strong public structures enable economic growth and empower the people and companies to prosper while protecting the investment that built it all. So people return a portion of the resulting prosperity as taxes to invest in building and maintaining this infrastructure.

That is how good, solid self-government should work. The people build the public structures that enable each other to prosper and that protect the investment. And it worked for us.

But then, along come the quick-buck artists, looking to grab what they can for themselves, as fast as they can, without doing their part or sharing their gains or leaving anything but a mess behind. And they found a way to accomplish this. They found places outside of our borders where the people had not yet built up the solid, democratic governmental institutions that protect people and the environment as ours do. They fired the workers who had built up the companies and communities, packed up the machines that made the products, closed the factories, and opened factories on the other side of those borders.

Moving factories across borders is just a way of evading our laws and our protections, that we have fought so hard to get in place. So why do we let them bring the same products that we used to make here, back across those borders to sell in the prosperous market that our hard-won public structures enabled?

People fought and died so we could maintain our own strong government that protected us and enabled our prosperity. We built up our prosperity over time and with many hard fights, and that is what has made our county the market that everyone wants access to. We should use that market power to set the terms of what can be brought in to this country. We should help the people in countries that have not yet build up the kind of strong, democratic governments that can protect them from the quick-buck artists and exploiters instead of letting those manipulative consters wipe out our jobs and tear down our own government and rules. We should say that before products get access into our market the workers that make them should be paid well, and the environment they are made in is protected. Maybe we shouldn't allow goods from undemocratic countries in at all. What do you think?

We worked hard to build what we have, and we are letting that be taken away from us. It is time to stop allowing our factories to be closed and moved across borders as a way to get around the rules and standards we fought so hard to put in place.

Posted by Dave Johnson at 4:11 PM | Comments (1) | Link Cosmos

November 3, 2009

Working At The Polls

I am working at the polls today. Not a single voter yet...

Update - 8:45am - still no voters. Not one.

Update - We had a flurry of two voters at around 9:15am.

Update - 3:30pm - nine voters so far today. A few people dropped off their absentee ballots.

Final Update - Total of 12 voters on the machines, six absentee drop-offs and one vote on paper but somehow she took the ballot home with her.

Posted by Dave Johnson at 3:36 PM | Comments (0) | Link Cosmos

October 17, 2009

Final Bush Budget Year Ends - $1.4 Trillion Deficit

Well the last Bush budget year just ended. So how did the Republican budgets do? When Bush took office we have a HUGE budget surplus - over $230 billion. Alan Greenspan warned that we were paying off the debt too quickly. Then came Bush and his tax cuts for the rich, and the Republican spending binge.

So now? Record-High Deficit May Dash Big Plans,

The federal budget deficit soared to a record $1.4 trillion in the fiscal year that ended in September, a chasm of red ink unequaled in the postwar era that threatens to complicate the most ambitious goals of the Obama administration, including plans for fresh spending to create jobs and spur economic recovery.

Update - Oh, look, Republican blogs are claiming that the budget for the fiscal year that ended in September is Obama's budget, even though he didn't even take office until January! That;s like how FOX News puts an R after a Democratic legislator's name when they do good things, or a D after a Republican's when another one gets caught lying about an affair.

Posted by Dave Johnson at 2:52 PM | Comments (2) | Link Cosmos

October 9, 2009

Modern Governoring

This post originally appeared at Speak Out California.

What does it mean to be a "governor?" What does it mean to "govern?"

In the news, the Governor has threatened to veto 700 bills in an attempt to force the legislature to do his bidding on water policy.

700 important items all held hostage, trying to stampede and scare the legislature to do something in a hurry, while terrible scare stories circulate on talk radio and throughout corporate media. Does this sound like a familiar tactic?

Water policy is complicated because over many decades wealthy real estate developers bought permission to build huge swaths of housing in dry area, so water needed and needs to be piped in from  ... somewhere else. And huge agricultural interests make a lot of money using water that used to be heavily subsidized, meaning the people paid for the water and a few wealthy corporate interests pocketed the profits.

At the same time there is less water to go around.  We have had three years of below-average rainfall, which is possibly a permanent condition because of climate change (which Republicans deny is happening). And the destruction of the environment and fisheries and groundwater caused by past bad practices is catching up, so hard choices must be made.  Does our government protect the people, the environment, corporate profits?

So on one side of this we have giant corporations and the short-term profits they suck out of our communities and state, and of people who are where they are after being lured there for the sake of those short-term profits, and who eat the way they do because government had been "persuaded" (paid) to subsidize the water for the sake of those short-term profits.  People need water to drink even if they do live in a desert and need to eat and have gotten used to food that costs less because the water has been subsidized. (But maybe they don't need to water their driveways and nice lawns.)

On the other side we have the long-term interests of most of the people and of the environment.  See if you can guess which side the Republicans and the Governor are on?

Click through to Speak Out California

Posted by Dave Johnson at 12:37 PM | Comments (1) | Link Cosmos

October 5, 2009

We Need A Jobs Program And Leadership That Will DO It This Time

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

Friday’s jobs report said 263,000 jobs were lost in September.

BUT that is after 571,000 people gave up actively looking for work. The number of jobs lost last month was 263,000 plus 571,000 = 834,000.

The "stimulus plan" is currently creating (and/or saving) between 200,000 and 250,000 jobs a month. Yes, that means the real job loss would have been at least 1,034,000 without the assistance of the stimulus plan.

On top of that the "birth/death" model -- the government's assumption that a number of small businesses are starting up that they are not tracking -- is overestimating job creation, leaving policymakers without needed warning signals. The job loss numbers for the last year are expected to be revised upward by 824,000 early next year as a result.

This is bad. Really bad. We need a real jobs program, and we need it bad.

There is something else we need: we need progressive leadership that understands how important this is to people.

Here is what I mean. I came across a news story from the fight over the stimulus plan earlier this year, that now in light of Friday’s terrible jobs report says a lot more than it said at the time. House Dems Strip Stimulus of $200 Million Provision to Refurbish National Mall,

“The move was made amidst a torrent of GOP criticism about wasteful or non-stimulative spending in the bill, including those two projects, as the president attempts to woo House GOPers.”

Yes, the House gave up this project that would have brought jobs to DC - and fixed up the the National Mall - to try to get Republican votes. How did that work out? How many House GOP votes did they get?

How many people in DC could be employed fixing up the mall and other buildings? The Democrats took out $200 million that was originally in the stimulus without gaining a single vote for the bill for doing it!

Meanwhile, the terrible jobs report showed that state and local governments are shedding jobs,

"Government employment fell by 53,000, with the largest drop—24,000 jobs—in the noneducation component of local governments."

With that in mind, let me remind you of this brilliant negotiating tactic: Senate Stimulus Compromise Deals a Blow to Cash-Strapped States,

... "state stabilization funds" ... were cut back by $40 billion this weekend in the deal cut by Senate centrists.

That's right. The original stimulus plan provided funds to help keep states from laying people off. These funds were cut -- and now states are laying off.

The compromises in the stimulus plan have consequences, and those consequences are people's jobs. The compromises were an experiment in "bipartisanship" that failed. The stimulus package gave up several important things, but how many Republican votes were won over? And as a result real people are losing real jobs.

Making matters worse, unemployment compensation is starting to run out for many people who were laid off when this mess started. AND the COBRA health insurance subsidies are running out soon as well! On top of that, contractors - employees who are not called employees because companies can get away with not paying benefits, stock options, unemployment insurance, etc. - a huge component of the labor force, don't even get unemployment or COBRA in the first place.

We Need Jobs Programs NOW

So here is an idea from outside of Washington: How about our government help our people by putting together some real jobs programs? Put people to work while we figure out how to fix the economic mess that conservative policies created.

It is time to use the power of government to start doing something that helps people, and that is not blocked by a misplaced need to get "centrists" (read: politicians trolling for payments/future jobs from big corporations) to like you or a fear that Rush Limbaugh is going to say something bad about you if you go ahead and do what we elected you to do. Here is a news flash: The market-fundamentalist corporatists are not going to like you, and Rush Limbaugh IS going to say bad things about you. Get a clue, they are not responding to the carrots so start using sticks.

Friday's jobs report says this mess is not going away any time soon. Friday’s jobs report shows that things are too serious and too many Americans are suffering for the administration and congressional leadership to continue playing nice guy and give-in strategies. This is important to too many people. People need to be able to eat and have shelter – never mind the health care fiasco – and they need this now.

And it would be politically popular. Think about this: giving people jobs would be politically popular.

Here are some job ideas:

Why don’t we pay people to start retrofitting homes and buildings today to be energy efficient, for free?

Why don’t we pay people to do thousands of projects in the national and state parks?

Why don't we add a teaching assistant to every classroom> And why don't we hire enough teachers to cut class sizes in half?

Why don't we fix all the roads and bridges that haven't been repaired for decades?

What about direct aid to manufacturers who still cannot get credit?

Here's a big one: why don't we cut the workweek to 30 hours? How many people will that put to work? Do you think people are going to object to having to work 30 hours instead of 40?

Oh, and why don't we fix up the National Mall in Washington DC? It needs it and people in DC need jobs. There is simply no excuse not to do this.

Posted by Dave Johnson at 8:34 AM | Comments (1) | Link Cosmos

September 30, 2009

A New Economy from Old Roots?

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

How do we build a new economy out of the collapse of the old economy? How do we start fresh to begin creating jobs again, while building in economic and environmental sustainability, as well as workplaces that respect human needs and rights? How do we change things so that we all get to share the benefits of the economy rather than just contributing to the increasing wealth of a few vastly wealthy people?

While we look for a vision for a new economy, we should examine what has worked in the past. America had periods in which regular people enjoyed sustained increases in their standard of living. For a long time it was a conventional wisdom that each American generation would do better than the previous generation, more people would receive good educations, medical care would get better, the middle class would grow, leisure time would increase, poverty rates would decrease, retirement would be easier, etc.

But this pattern stopped. Beginning in the late 1970s and especially in the 1980s incomes began to stagnate, wealth increasingly concentrated at the top, working hours and workplace pressures steadily increased, availability of good health care started to decrease, etc. The standard of living of most Americans began to and continues to decline. At the same time corporations became more predatory as consumer protections vanished. Meanwhile outsourcing, deunionization and other anti-worker policies led to increasingly unpleasant, stressful and unrewarding worklives for more and more people.

Many of today's problems are traceable directly to the policy results of anti-government propaganda that was blasted out from well-funded conservative think tanks starting in the 1970s. The anti-government campaign led to defunding of many national, state and local government programs that improved education, helped the poor or enriched people's lives. We suffered deregulation in many areas where the government had protected consumers, workers, investors and the environment. Huge reductions in taxes for the wealthy were either offset by tax increases for the rest of us or government borrowing. And that borrowing has led to increasing problems of paying the interest and threats to funding even basic programs like Social Security and education.

So what worked, before the conservatives trashed the place?

Regulation

One thing we know for sure now, learned the hardest way thanks to the financial crisis: regulation worked. Regulation was necessary, it worked, it kept firms from taking risks that could bring down the economy. And we can also see now how regulations protected consumers from predatory corporate activities, workers from wage theft or unsafe working conditions, and the environment from exploitation and destruction.

Taxes

Before Reagan the tax rates at the top were very high. After you reached - and took home - a certain very high income you paid a high percentage of the rest in taxes. This had many beneficial results – even for the people who paid higher taxes. Government could afford to keep the physical, education and legal infrastructure in good condition without borrowing. Government could afford to invest in programs that improved our standard of living, health, knowledge and technology, which helped businesses grow. Businesses thrived in such well-watered soil.

The high tax rates also kept the bad side of human nature in check. When it took years to build up a fortune businesspeople had to rely on the health of the greater community to nurture their own wealth-building enterprises and keep them thriving over a long period. They had to think and act long-term. The roads needed to be kept in repair, the schools needed to provide excellent education to potential employees, the courts needed to be functional to enforce contracts, and they wanted the communities they were going to have to stay in to be pleasant places to live.

But once taxes were lowered vast windfalls could be realized from a single event and it made more sense to try to fleece the community with quick-buck schemes than to rely on it. We began to see corporate raiders break up solid, ongoing companies, steal pension funds, etc., while encouraging communities to cut spending on schools, roads, etc. It became more profitable sell off or outsource our manufacturing capacity. And then, as things fell apart, the few who benefited could just fly away in their private jets or sail away in their huge yachts. The greater community was no longer any use to them except as crops to be harvested. Vulnerable consumers are the only crop that is coming up in this economy.

Big Government

Government is We, the People making the decisions. "Big government" is simply another way of saying that more of the important decisions are made by the people. Shrinking government means handing the decisions over to big corporations. In the real world this is the choice. And in the real world big corporations make decisions that benefit them, and only them. Before you badmouth government think carefully about what the alternative is.

Old-Fashioned Government Planning

As I said in a post a few months ago,

The phrase “industrial policy” sounds so Walter Mondale, 1970s, smokestacks and brick factory old-fashioned. I suspect the subject turns people off, eyes glaze over, hands reach under the table for iPhones and Blackberries…

But here we are without an industrial policy. How’s that working out for us? Every other country has one. China seriously has one. We instead have huge trade deficits. We don't make things here so we have to borrow money to buy things made elsewhere.

To add insult to injury, recently Deutsche Bank released a research note advising investors that the U.S. was not a good investment because of our lack of a government industrial policy. See Deutsche Bank: Absence of US Clean Energy Policy Will Send Global Capital Elsewhere.

While we envision a new direction for our economy, maybe we should also be looking at returning to a few old-fashioned ways of doing things, too.

Posted by Dave Johnson at 4:09 PM | Comments (0) | Link Cosmos

September 23, 2009

Enforcing Trade Rules Shocks "The Village"

This post originally appeared at Campaign for America's Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

The New York Times business section has this today, With a Receptive White House, Labor Begins to Line Up Battles. Oddly this "news" story incorrectly casts enforcement of trade agreements as opposing "free trade." From the story,

While labor’s opposition to free trade is nothing new, having an ear in the White House is. The Obama administration, though it says it supports free trade, has so far seemed more aligned with labor’s trade agenda than has any administration in decades.

What has alarmed America’s trading partners is the steelworkers’ victory when the president imposed a 35 percent tariff on Chinese tires under special trade rules that allow punitive measures without a finding of illegal trade practices.

... The president’s move has stirred worries that other unions and industries will rush to seek similar relief.

Here's the thing. This is not about opposition to free trade. This is about enforcement of existing agreements. This is nothing more than a request to the proper enforcement authorities to investigate if agreements are being violated, and to take the agreed-upon steps to remedy that if they are. But in recent years it because the expectation that the White House made decisions that were not based on rule of law, but rather on ... something else. From the article,

In four safeguard cases, President George W. Bush declined to impose penalties even though the United States International Trade Commission, a bipartisan panel, had found that Chinese imports hurt particular industries.

THAT should have been the shocking news, not the current news that agreements are going to have to be lived up to! A President of the United States sided with other countries, against American companies and workers, even after the trade enforcement bodies found clear violations of the agreements!

It seems that after eight years of general lawlessness we're at a point where it is expected that those with power can do anything they want regardless of agreements or laws. So now "the Village" (blogger term for comfortable "inside-the-beltway" Washington DC insiders) is shocked and offended when the rabble -- the rest of us -- actually wants the authorities to enforce the rules instead of deferring to power -- even when, as in this case, that power is being used against America. For example, when Attorney General Holder was looking into investigating whether laws against torture were broken, "the Village' was all atwitter and scandalized over the audacity of President Obama letting such a thing happen -- as if it was in any way appropriate for a President to make a political decision to keep the Justice Department from an investigation.

Under the previous administration it was expected that such decisions would be decided politically, based on who was donating the most to The Party or its supporting infrastructure of think tanks, etc., on any given day. Now we are seeing a return to rule of law. It's the same thing with this request to see if trade agreements are being honored.

The Village owes the concept of rule of law an apology.

Posted by Dave Johnson at 11:02 AM | Comments (0) | Link Cosmos

September 18, 2009

Big Government

Government is us, democracy, We the People in control of the decision making. Conservatives rail against "big government," which literally means they are against We the People making decisions. And that necessarily means they want big corporations and a wealthy few making the decisions instead because that is the only alternative.

THAT is the choice - either the people through our government, or control by and service to a few big corporations and wealthy people.

Posted by Dave Johnson at 1:41 PM | Comments (0) | Link Cosmos

August 17, 2009

Where's The Stimulus?

In Pittsburgh I passed a big sign at a construction project. It says "American Recovery and Reinvestment Act." Fine - whatever that is.

Fine, but what I want to know is where is the stimulus money?

Posted by Dave Johnson at 9:23 AM | Comments (0) | Link Cosmos

July 22, 2009

When They Say Government They Mean You

This post originally appeared at Open Left.

I'd like to talk about government. The conservative/corporate propaganda machine has turned "government" into a bad word. Conservatives portray our government as some kind of enemy of the public. We have all heard the scare stories about the harm done by meddlesome regulations from intrusive big government programs run by government bureaucrats.

Let's step back from reacting to the word as we hear it today and think about what the word really means.

In America government is us. It is, by definition, "We, The People." Our Constitution is the defining document of our government and it couldn't be clearer, declaring that We, the People formed this country "to promote the general Welfare, and secure the Blessings of Liberty to ourselves"... In other words, watch out for and take care of each other; "We, the People" have banded together to watch out for each other, take care of each other and build institutions to protect and empower each other.

With this in mind let’s try an experiment. Try substituting some variation of the words, "We, the People," "us" or “the people making decisions for ourselves” every time you read or use the word "government." Or use the word "our" instead of "the" when you say "the government." Our government, us, we, the people, working together to take care of and empower each other.

My favorite use of this experiment is to apply it to Reagan’s keynote statement, “Government is the problem, not the solution.” Reagan is making a profoundly anti-democratic statement here. He is saying that “The people making our decisions for ourselves and watching out for each other is the problem.”

With statements like these, Reagan and the conservatives are advocating a different system of government than democracy. They are saying that we should hand those decisions and responsibilities over to the "private sector" - the corporations - and let others decide how things are going to be done and how our money and common resources will be used.

Another example is when conservatives repeat, “Don’t let the government tell us what to do.” That becomes, “Don’t let us tell us what to do,” or a little more broadly, “Don’t let us decide the rules that we will live by.” If WE aren’t the deciders, then who is? What about the conservative pejorative, “big government?” They are complaining about “big We, the People.” They want “limited government.” So they have a beef with US having more power over ourselves! Of course, if WE don’t have this power, who do you think will?

Conservatives complain about government as a meddlesome, intrusive problem. But just who is government a problem for? If you are a top executive in a large chemical corporation and your bonus depends on lowering the cost of discarding toxic wastes, government stands between you and the river into which you want to dump the wastes. It costs the company less to dump the waste into the river, you will get your bonus, but We, the People don't want that stuff in our water. So for you, government is the problem. And that is a good thing. But our government is us. Our government protects us.

How about the refrain that people shouldn’t rely on government, but instead should rely on themselves? That sounds good, somehow. But try it with “each other” and a small adjustment to “themselves,” and what they are saying becomes, “People shouldn’t rely on each other they should be on their own.” This is a variation on their “personal responsibility” mantra. They want us alone and defenseless. (This is also why they hate unions.) Is alone and defenseless really such a good way to live, especially in a world dominated by big corporations always trying to trick us and get our money? Wouldn’t it be better if we were working to protect each other from the big corporations?

Spending: When conservatives complain about government spending they mean empowering and taking care of each other. They don’t like us doing that. We as a species learned from the beginning to band together, take care of each other. And now they want us separated and on our own.

Government taxing and spending is what empowers us. In the 1950s President Eisenhower proposed building the interstate highway system. That was an example of government spending, and as I wrote the other day, the top tax rate was over 90% on income above a certain amount. So after executives and owners of big companies made several hundred thousand dollars additional income was taxed at a very high rate. They could still become very, very wealthy, but more slowly. This taxation meant that the major beneficiaries of our government helped us pay for our government.

It paid off. The interstate highway system triggered a surge of economic growth, new industries, new products -- and even greater income for the very people who were taxed to help pay for it.

We also spend money protecting each other. Let’s talk about the distortions in military spending another time. What about our spending to regulate corporations and enforce those regulations? Or spending on education or health care or parks? Conservatives just hate that. They have convinced much of the public that government spending - the people taking care of each other - is bad. And the way to disempower us is to cut taxes, the ability to gather the resources we need to fight the battles we fight with the rich and powerful.

Try these experiments, substitute "us" and "We, The People" when you hear conservatives complain about government. Substitute "the resources we need to empower each other and fight the powerful" when you see the word "taxing" and substitute "taking care of each other" when you see the word "spending." This can be very powerful and empowering. It helps us see what kind of world the conservatives are really advocating.

Posted by Dave Johnson at 9:34 AM | Comments (0) | Link Cosmos

July 8, 2009

CA Voters Kept In Dark About Budget

This post originally appeared at Speak Out California

Today's San Jose Mercury News has a front-page story, California leaders in no hurry to break budget impasse. From the story,

Despite plunging tax revenues, Wall Street's unwillingness to loan the state money and billions of dollars worth of IOUs hitting mailboxes, California's leaders are displaying a seeming lack of urgency to close the state's $26.3 billion deficit.

Gov. Arnold Schwarzenegger and legislative leaders blew past a supposedly ironclad June 30 deadline to pass a new budget...

Blew past? The legislature did pass a budget fix last week, but the Governor vetoed it! This choice by the Governor led to the state needing to issue IOUs.

To their credit (I guess) the San Jose paper hinted at the veto in an editorial a week ago, Governor didn't need to push state over the edge, writing,

In rejecting a stopgap fix for the budget on Tuesday, the governor and GOP leaders have accelerated a budget meltdown that pushes the state deeper into debt."

Talking to people involved, I pick up a sense that passing a budget fix after the Governor said he would veto it was pointless, so not worth mentioning. But isn't that for the voters to decide?  Many would say that passing the fix, especially at the last minute after all negotiations had failed and the state was going over the cliff was the responsible thing to do, also known as governing. This put a budget fix on the table and available for use to avoid the calamity and cost of IOUs, rating downgrades, etc. The Governor had a clear choice at that point, and chose to take the state over the cliff.  The voters should have been told, not kept in the dark that the Governor made that choice.

Meanwhile, the other side still refuses to offer up any plan of their own, still insisting that the Democrats fix the budget entirely with cuts to services that the public needs and take the blame for that.  They refuse to allow any plan that asks oil or tobacco companies to pitch in. They claim the wealthy will "leave the state" if asked to pitch in an additional $40 a week. They make up stories about companies leaving the state (but can't name any). But it is not reported that the Republicans refuse to offer a plan or engage in serious negotiations. It is as if the Republicans are expected to not be serious, so it's not worth reporting that they aren't serious. The voters should have been told.

The system of democracy depends on the voters being informed so they can apply pressure as needed and remove officeholders who are not doing what the voters want them to do.  But none of this works if the citizens have no way of learning simple facts, like that the legislature did govern responsibly and pass a budget fix, which the Governor vetoed. The voters should have been told.

Click through to Speak Out California.

Posted by Dave Johnson at 3:34 PM | Comments (0) | Link Cosmos

July 7, 2009

Governing Or Coasting On Governing By Others

This post originated at Speak Out California

The resignation of Alaska Governor Sarah Palin provides an opportunity to understand what is happening to us in California. There are people who have so little respect for government and governing that they thing Palin's resignation is a good thing. In California there are also people who have so little respect for government and governing that they think it is a good idea to let the state fall off of a financial cliff.

Sarah Palin is said to be resigning so she can climb the ladder of Republican politics -- possibly even to run for the Republican nomination for President in 2012. One would think that abandoning office in the middle of her term would disqualify her from having a future in seeking elected office. But this is not the case -- just the opposite. In fact this is so much not the case that the resignation is seen as a "brilliant" strategic move to increase her chances of obtaining that Presidential nomination prize.

The lesson to take away from Palin's resignation is that actually governing once elected to office is not the point. Modern-day Republican Party politics is not about governing, not even a little bit. It is about being against governing.

This is how they can get away with being against government: Good government was put in place in this country in the 1930s, 40s, 50s and 60s (with 90% tax rates at the top, by the way) and has been taken for granted since. The infrastructure of roads, laws, trash collection, etc. has been in place and functioning for so long that it is taken for granted. And so it all provides a safe platform for anti-government ideologues to pretend that government is not needed.

This brings us to California. We have a minority of elected officials who also do not care about governing. So far they have been able to get away with it, because of the work that We, the People did for several decades to build this state and make it governable.

California enjoyed massive government infrastructure investment from the 1930s through the 1960s. We built the best roads, water systems, schools, courts, etc. As a result we had the most prosperous industries, most well-educated people and best-functioning government.

And so the anti-government tax-cutting ideologues were able to defer maintenance of that wonderful system, handing the maintenance money out as tax cuts, and no one saw the foundations of that prosperity slowly begin to erode. They were able to complain about government and ignore governing because government was there for them and all of us anyway.

Well now we have coasted along on the infrastructure built decades ago, but it has eroded, and we are coming to the end of the time when the ideologues can enjoy the luxury of deferring maintenance. But our Republican leadership is firmly entrenched in their anti-governing ideology. They are willing to let the state fall off a cliff rather than actually pay to maintain the governing structure they depend on -- because they believe it will just operate as it seemingly always has, for free.

But governing is about about the people of the state and their needs. It takes skill, wisdom, an understanding of government and governing to be an elected leader. Sarah Palin obviously has none of these qualities, nor does Ahnold, for that matter. While our most vulnerable people are begging for their services and programs not to be dismantled so that they can actually have food and help in their most basic needs, our Governator boasts about sitting in his jacuzzi smoking a stogie.Would FDR ever suggest that? Would Dwight Eisenhower? What kind of leadership, compassion, understanding is reflected in these kind of "leaders." The answer is obvious and dramatic: NONE.

Click through to Speak Out California

Posted by Dave Johnson at 1:40 PM | Comments (1) | Link Cosmos

July 4, 2009

We Don't Need No Stinkin' Governing

People need to understand that in Republican circles, resigning as Governor does not harm Sarah Palin's career. Being a Governor is just ... governing ... and Republicans don't do that.

In fact, there is a contempt for the idea, and Palin has just reinforced her brand as one with contempt for government. The very word, "Governor," is suspect to them. The only use of the job is to affect redistricting so Republicans can have more power, and to keep a state from "spending" (also known as providing services to the citizens) and especially from asking the rich or corporations to pay any taxes for their use of the infrastructure the rest of us built.

In California we understand this.

Posted by Dave Johnson at 7:03 AM | Comments (0) | Link Cosmos

June 24, 2009

George Will Gets It Right About Government

This post originally appeared at Speak Out California.

Sunday's San Jose Mercury News contains an anti-government op-ed by George Will, "Democrats want nation dependent on government". (The online headline is different.)

This sounds scary, sinister, even somehow slightly evil. But if you look into the meaning of the words, the effect changes.

Here is what I mean. In America government is us. Our Constitution is the defining document of our government and it couldn't be clearer, declaring that We, the People formed this country "to promote the general Welfare, and secure the Blessings of Liberty to ourselves"... In other words, watch out for and take care of each other; "We, the People" have banded together to watch out for each other, take care of each other and build institutions to protect and empower each other.

So with them real meaning of the words in mind Will's headline becomes "Democrats want nation to take care of each other." Will is exactly right, and good for them.

Will's column is about the national healthcare reform battle and proposals for a "public option," which offers a Medicare-like health insurance plan to all of our citizens. Will opposes this, because,

"Competition from the public option must be unfair because government does not need to make a profit and has enormous pricing and negotiating powers."

In other words, he is complaining that a public option health insurance plan will provide more benefits to more citizens at a lower cost. Will casts this as a bad thing, because it threatens the ability of a few wealthy business owners to profit from people's need for health care.

Profits for a few instead of benefits to the public appears to be his idea of the purpose of government. But to the rest of us the point of health care reform is to take better care of each other while lowering the costs. This is why the "public option" is necessary -- private, profit-driven companies are not designed to accomplish delivery of essential services to everyone. Profit-driven companies are designed to deliver only to those who are willing to pay the most, which when applied to essential human needs violates fundamental tenets of democracy. We are supposed to be a one-person-one-vote country, not a one-dollar-one-vote country.

Again, Will and other conservatives use lots of scary words. But if you look at the meanings of the words, their complaint is with Americans who want to enjoy the fruits of democracy and equality, and take care of each other.

And this is supposed to be a bad thing?

Click through to Speak Out California.

Posted by Dave Johnson at 7:48 AM | Comments (3) | Link Cosmos

June 22, 2009

Recession Result Of Low Taxes

A thought: The country and states lowered taxes in the 80s, and now we are seeing the results. Low taxes let people get rich in a hurry so sound and sustainable business practices were abandoned as foolish. Wealth concentrated straight to the top, and now average people are strapped to pay for anything. Meanwhile get-rich-quick schemes stripped the forests, oceans and mountaintops.

Put the top tax rate back to 90% and watch the changes as people have to build real wealth slowly over time. This means they have to use sustainable business and environmental practices. And watch the economy as regular people start to benefit again and national and governments have funds to actually engage in helping regular people again.

Posted by Dave Johnson at 7:34 AM | Comments (2) | Link Cosmos

June 6, 2009

Health Care: Public Option Is A Must

I just want to go on the record here that any health care reform must include a "public option." This is an option for insurance that comes from the government, not from for-profit companies. Without it there really is no "reform."

This is a deal-breaker: no public option, then no anything, and we keep trying to get health care that works for the public instead of just taking our money to benefit a few.

Conservatives like to say that government is inefficient, incompetent, cumbersome, wasteful and can't compete with "the private sector." But NOW they're suddenly all worried that private businesses can't compete with government. The ONLY reason there is consideration of continuing the failed, greedy, destructive corporate insurance system is because the few who get rich off of it are paying off politicians to keep things they way they are.

This is about providing what is best for the people, not about watching out for corporate interests and the profits that get funneled up to a few people at the top. If business can serve the people better than the people (government) can, let them prove it by including a public insurance option in the health care reform.

Posted by Dave Johnson at 1:30 PM | Comments (2) | Link Cosmos

May 28, 2009

California Election Results -- What The Public Wants

This post originally appeared at Speak Out California.

Did the results of the special election on the budget propositions really show that the public is against taxes and government, as the Republicans claim?  Recent polling looked at the reasons the propositions failed.  Polls are a useful way to understand what people really thing because they take a scientific sample, actually asking the voters what they think, instead of just repeating something that Republicans just say.  Let's see what the voters give as their reasons for opposing the propositions.  From the polling:

• 74% of voters polled thought the election was just a gimmick, not an actual fix for California's budget problems.
• 70% of the voters polled said the legislature is a captive of special interests (possibly because people are learning that the "budget deal" that they came up with in the middle of this emergency included a huge tax cut for large, multi-state corporations.)
• In a budget battle dominated by Republican demands for spending cuts instead of asking the rich and corporations to pay their fair share only 19% of voters polled said that Californians are being asked to share the pain equally. 
• And to drive that point home, only 29% of voters polled said that the budget should be balanced only with spending cuts.  According to the polling "even among 'No' voters, less than half (46%) say the government should rely entirely on spending cuts with no tax increases."

In summary, voters resented that the legislature is held captive by the 2/3 rule, and want them to address that instead of coming up with short-term gimmicks to get through another year while making things even worse later.

Additionally, and completely contrary to anti-tax and anti-government claims, the polling showed "broad support for new revenue streams."  According to the polling report, the public supports:

• Increasing taxes on alcoholic beverages (75% support)
• Increasing taxes on tobacco (74% support)
• Imposing an oil extraction tax on oil companies just like every other oil producing state (73% support)
• Closing the loophole that allows corporations to avoid reassessment of the value of new property they purchase (63% support)
• Increasing the top bracket of the state income tax from nine point three percent to 10 percent for families with taxable income over $272,000 a year and to eleven percent for families with taxable incomes over $544,000 a year (63% support)
• Prohibiting corporations from using tax credits to offset more than fifty percent of the taxes they owe (59% support)

The corporate right has to spin last week's special election as an anti-tax vote.  What else can they do?  But, as usual, their spin goes completely the other way from the facts.

Let's put them to the test.  The corporate right claims that this election showed that the public is solidly against government and taxes.  If they really believe that, how about reinstating majority rule in California, instead of requiring a 2/3 vote to pass budgets and taxes? 

Since they claim that the public is solidly against taxes, will they also support a straight up-or-down vote on taxes?  Of course not.  The public is not with them and they know it. This is just a ruse to continue destroying our great state and our democratic process.

Click through to Speak Out California.

Posted by Dave Johnson at 2:34 PM | Comments (0) | Link Cosmos

May 26, 2009

Are California Voters 'Anti-Government?'

This post originally appeared at Speak Out California. In the op-ed piece titled, "A rising anti-government tide," Republican leader Newt Gingrich wrote last week about California's special election,

"This vote is the second great signal that the American people are getting fed up with corrupt politicians, arrogant bureaucrats, greedy interests and incompetent, destructive government."

For those unfamiliar with the history of Newt Gingrich here is a quick lesson in what you are hearing.  Newt Gingrich is a father of Republican nasty-talk.  In 1990 Gingrich introduced a memo titled, "Language: A Key Mechanism of Control," advising Republicans to use certain words over and over, always describing opponents as "destructive," "incompetent," "greedy," etc., and always describe Republicans as "humane," "fair," "principled," etc.  Please go read the memo and see for yourself.  Gingrich's advice was to just insult and insult and be nasty dirty up the discourse, and you will win elections.  And, of course, that is what they did and they did win elections - for a while.  They are still nasty and just insult and insult, but they haven't been winning elections. 

So, knowing that, take anything Gingrich says with a grain of salt.  (Never mind that Gingrich is also known for committing adultery in a car in the parking garage of the U.S. Capital, with a much-younger Congressional aide while he was Speaker of the House, during the Republican effort to impeach President Clinton for adultery!)  And ask yourself why any supposedly respectable news outlet would give him a platform to do the damage that he does.  
 
But back to the subject-at-hand, whether voters really, as Gingrich claims, expressed an "anti-government" message last week?  Does Gingrich have his facts right?  Let's check a fact. Gingrich wrote, "This model of high-tax, big-spending inefficiency has already driven thousands of successful Californians out of the state..." But everyone who actually knows anything about California knows that the reason people leave the state is because of high real-estate prices.  And the reason they are high is because so many people want to live here.  Of course, the implication (because it coincides with another Republican talking point) is that businesses leave the state because of taxes.  Studies that look at actual facts show this isn't true, either.  Brian Leubitz on Friday wrote about this at Calitics,

"He [Gingrich] highlights the Yacht Party theme that all these businesses are leaving California...except that they aren't. As noted by the CA Budget Project blog, the PPIC has shown that this really isn't true. PPIC event went so far as to say, in a report, that "it is important to be wary of anecdotal evidence of businesses fleeing the state to support arguments that California has an economic climate hostile to business.""

Can any readers name even a single business that has left California because of taxes?  If so, leave a comment.

Next: A look at the polls.  Click through to Speak Out California.

Posted by Dave Johnson at 10:46 AM | Comments (1) | Link Cosmos

May 20, 2009

Government Spending

Corporations have convinced the public that government and government spending are bad.

Question, was Eisenhower building the interstate highway system good or bad for the economy, the public and for corporations?

Discuss.

Posted by Dave Johnson at 11:01 PM | Comments (0) | Link Cosmos

May 7, 2009

Government Empowers And Protects Us

This post originally appeared at Speak Out California.

Watch this great video:

The video is funny, but it makes a point: We need government.  Republicans say "government is the problem" but just who is government a problem for?  If you are a top executive in a large chemical corporation and your bonus depends on lowering the cost of discarding toxic wastes, government stands between you and the river into which you want to dump the wastes.  It costs the company less to dump the waste into the river, you will get your bonus, but We, the People don't want that stuff in our water.  So for you, government is the problem.  And that is a good thing.  But our government is us.  Our government protects us.

Government also empowers us.  In the 1950s President Eisenhower proposed building the interstate highway system.  That was an example of government spending, and the top tax rate was over 90% on income above a certain amount, so after executives and owners of big companies made several hundred thousand dollars additional income was taxed at a very high rate.  (They could still become very, very wealthy, but more slowly.)  This meant that the major beneficiaries of our government helped pay for our government.  And it paid off.  The interstate highway system triggered a surge of economic growth, new industries, new products -- and even greater income for the very people who were taxed to help pay for it.

Of course, at the time, some (not all) of the wealthiest objected to being taxed, even though the taxes led to even greater gains for them as well.  They were shortsighted and considered government to be a problem.  Lucky for all of us, even for them, it didn't turn out that way.

P.S. They're serious about hating government, and they really do hold up Somalia as an example of what they want!  Go see for yourself at the libertarian Mises Institute, which "defends the market economy, private property, sound money, and peaceful international relations, while opposing government intervention as economically and socially destructive" where they write in Stateless in Somalia, and Loving It,

Somalia has done very well for itself in the 15 years since its government was eliminated. The future of peace and prosperity there depends in part on keeping one from forming.

And see for yourself at the libertarian Reason Magazine, "the monthly print magazine of "free minds and free markets," where they write about The Anarchy Advantage in Somalia.

I guess if Cholera and lawlessness don't bother you, maybe you don't need government. The rest of us, however,...

Click through to Speak Out California and leave a comment.

Posted by Dave Johnson at 11:03 AM | Comments (3) | Link Cosmos

April 26, 2009

Swine Flu - Republicans STILL Creating Catastrophe

We face a potential swine flu pandemic, and we do not have the people in place in the Department of Health and Human Services (HHS) that we need. Why not? The Republicans are blocking confirmation of Obama's nominee, Kansas Gov. Kathleen Sebelius.

Why are they blocking this nomination? Because Gov. Sebelius won't approve Kansas Republican bills to block abortion even if the abortion will save the mother's life. They say she is "an enemy of the unborn," because she thinks doctors should be able to save the mother's life.

So as you worry about this possible flu pandemic, think about why your governement is not yet fully up and running to do its part and protect us. As we saw when hurricane Katrina hit New Orleans, government-hating Republicans destroyed our ability to respond to emergencies, and instead set up a system where contracts were awarded to cronies who collected the cash but never delivered the services. And now they continue to block our government's ability to protect us, because they think that a mother's life is not as important as a fetus.

The Senate should vote to confirm Sebelius tomorrow, no excuses.

Update - The Republicans fought hard and got all of the money for pandemic flu preparedness taken out of the stimulus package. Quick, before it is taken down, here is Republican Senator Collins' website bragging that she led the fight to remove "$780 million for pandemic-flu preparedness" from the stimulus package! And here is Karl Rove, with talking points attacking the stimulus package spending on "$462 million for the Centers for Disease Control, and $900 million for pandemic flu preparations."

More here.

Posted by Dave Johnson at 10:10 AM | Comments (2) | Link Cosmos

It's What The Money Is Used FOR

Investment is not "spending." It's what the money is used FOR that makes the difference. Repubican spending wasted money and drove up debt. Obama's investments will eventually help us pay off debt.

I am in a motel room and got up too early, so I'm watching the dreadful morning news shows, which means hearing the Republican talking points over and over and over. ... So they say Obama is spending a lot of money, and driving up the debt. Let's look at that:

1) Yes, we have to spend money on things made necessary by Republican policies, like unemployment checks, deferred infrastructure maintanance, interest on debt cause by tax cuts for the rich, etc.

2) Republicans spent money on things that caused problems: tax cuts for the rich, military, subsidies for crony corporations, etc. This just runs up debt without leading to any way to pay it off.

3) The Obama spending is on fixing problems, and investment. Spending on investment leads to ways to pay off the debt. Eisenhower spent to build the interstate highway system. But now look back at how that helped all of us and grew the economy in ways that allowed us to pay back that costs many times over. The Obama spending is on high-speed rail, alternative energy and energy efficiency, education and other investments that will enable us to eventually pay off even the Reagan/Bush debt.

4) Remember that Clinton brought us well along toward paying off debt until the Republicans got in and stopped that.

Sure it is spending. Spending is a good thing if it is spent on US and on investment. Bush did neither. Obama is doing both.

Posted by Dave Johnson at 7:20 AM | Comments (0) | Link Cosmos

April 22, 2009

Chris Bowers Says Make Them Actually Filibuster

Chris outlines how to actually make the Repubicans stand and tal for days when they filibuster things. This way the public will clearly see who is and who is not bloakcing important bills.

Open Left:: Make The Filibuster An Actual Filibuster

Posted by Dave Johnson at 10:48 AM | Comments (0) | Link Cosmos

Why We Have Low-Information Voters

We have low-information voters because they receive low information.

I was reading this story, Credit card bill tests Democrats' political will, and came across this:

Her [Rep. Carolyn Maloney, D-NY] proposed legislation would halt credit cards from imposing arbitrary rate increases and penalties and certain billing practices on balances with different rates. It is expected to win approval by the committee, and later by the full House.

But it remains unclear whether Democrats in the Senate can muster the 60 votes needed in that chamber to advance controversial legislation amid stiff opposition from the banking industry. The Senate's version of a credit card reform bill includes tougher language. [emphasis added]

The REASON that 60 votes are needed in the Senate is because the Republican party is obstructive every single bill. It isn't that "the Democrats" don't need to muster a few votes, it is that the Republicans are acting in ways never before seen in history. The name for it is "filibuster" and it was used on a few occasions in the past, when the concerns of the minority were sufficient to have them stay up all night talking.

Now we have a corporate-purchased party that blocks consumer legislation so they can get more lobbying money from the banking industry.

My complaint: No one reading a story like this would know any of this. So they would not have the information needed to make an informed decision in the voting booth, and certainly not know who to call to ask them to vote the right way.

The corporate news media is not serving our democracy. They serve a different master.

Posted by Dave Johnson at 8:27 AM | Comments (0) | Link Cosmos

April 19, 2009

America Was Created To Fight Corporate Power

Americans should all understand the reasons behind the formation of this country. We formed this country because a wealthy elite, called royalty, controlled the economy and set up legal monopoly operations for the benefit of their cronies, called corporations, and then set up the laws and tax structure to benefit those corporations and their owners at the expense of the rest of us.

We fought a revolution to change this. We set up a governement and economy that is supposed to be controlled by We, the People. Think about the meaning of that the next time you hear corporate-funded voices complain about "big government." They are complaining that the people make the decisions instead of the corporate elite -- once known as royalty.

PLEASE read The Real Boston Tea Party was Against the Wal-Mart of the 1770s

The real Boston Tea Party was a protest against huge corporate tax cuts for the British East India Company, the largest trans-national corporation then in existence. This corporate tax cut threatened to decimate small Colonial businesses by helping the BEIC pull a Wal-Mart against small entrepreneurial tea shops, and individuals began a revolt that kicked-off a series of events that ended in the creation of The United States of America.

They covered their faces, massed in the streets, and destroyed the property of a giant global corporation. Declaring an end to global trade run by the East India Company that was destroying local economies, this small, masked minority started a revolution with an act of rebellion later called the Boston Tea Party.

Later in the piece,

The citizens of the colonies were preparing to throw off one of the corporations that for almost 200 years had determined nearly every aspect of their lives through its economic and political power. They were planning to destroy the goods of the world’s largest multinational corporation, intimidate its employees, and face down the guns of the government that supported it.

A link to this was posted at Atrios' blog, by Avedon of The sideshow.

Posted by Dave Johnson at 7:51 AM | Comments (1) | Link Cosmos