Republican Insanity Continues Unabated Following Fiscal Cliff Agreement

Posted: January 4, 2013 | Author: | Filed under: Barack Obama, Medicaid, Medicare, Republican politics, Social Security, Surreality, U.S. Economy, U.S. Politics | Tags: , , , , , , , | 27 Comments
Crazy John Cornyn

Crazy John Cornyn

Have you heard the latest from Texas Sen. John Cornyn? This morning the Houston Chronicle published Cornyn’s bizarre op-ed in which he calls for a “partial government shutdown” if President Obama refuses to come to Republicans on bended knee with a plan to cut Social Security, Medicare, and Medicaid in return for Congress agreeing to raise the debt ceiling.

Over the next few months, we will reach deadlines related to the debt ceiling, the sequester and the continuing appropriations resolution that has funded federal operations since October. If history is any guide, President Obama won’t see fit to engage congressional Republicans until the 11th hour. In fact, he has already signaled an unwillingness to negotiate over the debt ceiling. This is unacceptable. The president should immediately put forward a plan that addresses these deadlines, and he should launch serious, transparent budget negotiations.

The biggest fiscal problem in Washington is excessive spending, not insufficient taxation. Tax cuts didn’t cause this problem, so tax increases won’t solve it. If we don’t reduce spending and reform our three biggest entitlement programs – Medicare, Medicaid and Social Security – then we will strangle economic growth, destroy jobs and reduce our standard of living. With the national debt above $16 trillion, and with more than $100 trillion in unfunded liabilities hanging over us, our toughest fiscal decisions cannot be postponed any longer.

Excuse me? Tax cuts didn’t cause the problem? The Bush tax cuts, combined with two interminable wars that Republicans allowed President Bush to exempt from inclusion in the budget certainly did lead to our fiscal crisis–with a lot of help from banksters. If Republicans want to “reform” the big three safety net programs, nothing is stopping them from coming forward with their own list of specific cuts. The President doesn’t have the power of the purse after all, Congress does. Back to Cornyn’s moronic screed:

Republicans are more determined than ever to implement the spending cuts and structural entitlement reforms that are needed to secure the long-term fiscal integrity of our country.

The coming deadlines will be the next flashpoints in our ongoing fight to bring fiscal sanity to Washington. It may be necessary to partially shut down the government in order to secure the long-term fiscal well being of our country, rather than plod along the path of Greece, Italy and Spain. President Obama needs to take note of this reality and put forward a plan to avoid it immediately.

WTF?!! Cornyn doesn’t seem to understand what failing to raise the debt ceiling would mean. Congress has already approved borrowing for expenditures that must be paid for. We’ve already reached the debt limit, we’re way beyond fixing our problems with a government shutdown. Of course Cornyn doesn’t explain what he means by that anyway, but I’m guessing he wants to stop Social Security checks and Medicare and Medicaid payments. Whatever, what he has written makes no sense.

Yglesias responds to Cornyn’s “outrageous op-ed.”

What he’s missing here is that the path he’s advocating is much worse than anything that’s happened in Italy or Spain. He proposing that the federal government simply default on payment it’s obligated to make.

We have had, in the past, episodes that have been called government shut-downs. What’s happened in those cases is that no new appropriation bill has been passed authorizing many branches of the federal government to operate. Absent an appropriation, there’s no legal basis for the government programs to be administered and so they aren’t administered. Then congress appropriates new money and things come back.

What Cornyn is talking about is something else. He’s talking about the government not paying bills that it’s already obliged to pay. Social Security and Medicare exist. Bondholders are owed interest payments. State and local governments have submitted paperwork to get their grants. Veterans are owed benefits. Contractors have agreed to do work. Congress has passed the appropriations bills. But if the debt ceiling isn’t raised, the Treasury won’t have the money to pay the bills it has to pay. The result won’t be a “shutdown” of government functions; it’ll be a deadbeat federal government. Some people won’t get money they’re legally entitled to. But who won’t be paid? And who will decide who won’t be paid? Does the Secretary of the Treasury just arbitrarily get to decide that bondholders and residents of blue states get paid, but there are no Social Security benefits for Texans? Can Obama dock Cornyn’s pay but not Chuck Schumer’s? Certainly there’s no legal authority for that kind of prioritization, but what’s Obama supposed to do if congress tries to prevent him from spending money that he’s legally obliged to spend.

As Dakinikat has already made abundantly clear to us in numerous posts, the U.S. is not in the same or similar position as Greece, because, for one thing, we can print our own money. Here’s just the latest from Dak on this point.

What we really need is a recovery. That will not happen with all the fiscal policies being placed on the table right now. Let’s review one simple thing. As long as you have a good currency, federal debt instruments in demand, and a vast array of taxable assets in your country, there is no such thing as a ‘bankrupt’ government or excessive debt.

Jamie Bouie discusses government shutdowns:

A government shutdown occurs when Congress fails to pass an appropriations bill. Without appropriations, the federal government lacks the authority to operate, and so it doesn’t. Agencies close, workers go home, programs are suspended, and nothing goes on for as long as Congress is at an impasse. This is what happened in 1995, when the Gingrich-led House forced a shutdown, and this is what almost happened at the beginning of 2011, when Boehner led his conference to a similar position.

This isn’t on the table. Rather, Cornyn is referring to the debt ceiling, which is a congressional limit on the Treasury’s ability to pay obligations. If Congress fails to raise the debt ceiling, the government will continue to function, it just won’t pay the people its promised to compensate. Social Security checks won’t go out to retirees, Medicare and Medicaid reimbursements won’t go out to hospitals, payments won’t go out to military contractors, and federal workers will receive an I.O.U for paychecks.

This is why its so dangerous for Republicans to refuse to raise the debt ceiling. Contra Cornyn, keeping the limit low won’t reduce deficits or stop the United States from accumulating debt; instead, it will keep the federal government from paying what it owes to a variety of people and organizations, from bondholders to pensioners. When you stop making payments on your mortgage, the bank comes to take your house. When the government of the world’s largest economy stops making payments on its obligations, financial markets spin into a panic.

In 2011, the mere threat of not raising the debt ceiling was enough to slow economic growth to a crawl, and nearly erase the gains of the previous months. Put another way, what Cornyn has signaled—along with most of the Republican Party—is a willingness to crash the economy and damage the full faith and credit of the United States if President Obama doesn’t adopt core parts of the conservative agenda.

Boehner

Cornyn isn’t alone in his insane tactics. This morning, John Boehner claimed in a “closed door meeting” with House Republicans that Americans support Republicans’ threats to bring down the national–and likely global–economies in return for allowing the Treasury to pay our debts.

“With the [fiscal] cliff behind us, the focus turns to spending,” Boehner said, according to a person in the room. “The president says he isn’t going to have a debate with us over the debt ceiling. He also says he’s not going to cut spending along with the debt limit hike.”

The Speaker cited a new poll conducted just before the New Year by the Winston Group, a Republican firm, which found that 72 percent of respondents “agree any increase in the nation’s debt limit must be accompanied by spending cuts and reforms of a greater amount.”

Boehner first laid out that principle in a 2011 speech in New York, and he has said he will stick to it as Congress debates the debt ceiling in the next two months. The Treasury Department said the nation hit its $16.4 trillion borrowing limit in late December and estimates the next increase must occur before March.

lindsey-graham-scsen

And Lindsay Graham made similar demands a few days ago.

Graham said he anticipates forcing Democrats to give in on a long list of the GOP’s top spending priorities in the new year: raising the eligibility age for Medicare, increasing premiums for its wealthier beneficiaries, and trimming Social Security benefits by using a new method to calculate inflation.

“I think if we insist on changes like that, we’ll get them,” he said.

At the Atlantic, Elizabeth Reeve notes that Republicans have embraced the label “hostage takers” and are taking pride in their claimed willingness to drive the country and the world into economic chaos.

Conservatives did not always advocate so openly that Republican lawmakers be really and willing to risk the full faith and credit of the United States, nor did they say this is what Republican lawmakers wanted to do. In August 2011, New York Times conservative columnist Ross Douthat put hostage-taking in scare quotes, and noted, “it’s an odd sort of hostage situation when the hostage seems to want to be there,” arguing that Democrats always negotiate on taxes. Today, the change is not just that conservatives are embracing this liberal talking point as their own. It’s that they’re doing it completely cynically. In 2011, you had some people — Michele Bachmann, for instance, at least claim that failing to raise the debt limit wouldn’t be so bad. “I’ve been in Washington for a long time, and I’ve seen smoke and mirrors time and time again,” Bachmann said in June 2011, calling the talk of the economic damage from a default “scare tactics.” The next month, she shrugged, “As we debate the debt ceiling, the players seem to have lost all sense of proportion.” This was widely viewed as crazy. In 2013, conservatives are not making the claim that failing to raise the debt limit would have few negative consequences. Instead, they’re just urging Republicans to use the crazy.

Today, the problem is not the political costs, but the lack of Republican unity to hold out for a great deal. “At some point we have to be serious about this,” Chocola told Newsmax. “At some point, Republicans have to do what Republicans say they have to do — and they have to stand up for limited government, spending restraint, and fiscal responsibility.” It’s not that the GOP has too many hostage-taking Bachmanns. It’s that it doesn’t have enough of them.

Unfortunately, as Greg Sargent reports, the corporate media seems to be buying into the “GOP debt ceiling spin.”

The early returns, based on the coverage of this looming battle so far, suggest Republicans are successfully defining the terms of this debate — they are defining it as a standard Washington standoff, in which each side will demand concessions from the other. Indeed, you can read through reams of the coverage without learning three basic facts about this fight:

1) Republican leaders will ultimately agree to raise the debt ceiling, and they know it, because they themselves have previously admitted that not doing so will badly damage the economy.

2) Because of the above, a hike in the debt ceiling is not something that Democratic leaders want and that Republican leaders don’t. In other words, it is not a typical bargaining chip in negotiations, in the way spending cuts (which Republicans want and Dems don’t) or tax hikes (which Dems want and Republicans don’t) are.

3) And so, if and when Republicans do agree to raise the debt ceiling, it will not constitute any kind of concession on their part — even though they will continue to portray it as such to demand concessions in return. It will only constitute Republicans agreeing not to damage the whole country, which does not constitute (one hopes) them making a sacrifice.

President Obama has stated that he will not negotiate with Republicans over the debt ceiling, only over a balance between increased revenues and spending cuts. Who knows whether he’ll stand firm or not? We can only hope that he will use every bit of the power of the bully pulpit to educate the American electorate about the consequences of failure to raise the debt ceiling. He can do it in the State of the Union and Inaugural addresses and he can continue traveling around the country explaining what the Republicans are up to. This might be a good time to hire Bill Clinton as official “explainer in chief.”

Regardless of what happens, this is certainly going to be a fascinating, though nerve-wracking fight to watch.

New Year’s Day Reads: The Lousy Deal

Posted: January 1, 2013 | Author: | Filed under: Fiscal Cliff, morning reads, U.S. Economy, U.S. Politics | Tags: , , , , , | 35 Comments
First Night fireworks against the Boston skyline

First Night fireworks against the Boston skyline

Good Morning and Happy New Year!!!

Sorry to be late with this post. I got so discouraged last night with our dysfunctional government that I went to bed completely disgusted. After a good night’s sleep, I’m feeling slightly more optimistic, if not truly hopeful. If I have any hope, it’s that perhaps the American people will rise up and let the president and Congress know what a horrible job they are doing.

So, what’s happening this morning? We officially went over the fiscal cliff at midnight even though the Senate approved a half-baked, crappy “deal.” Politico reports:

Congress lost a mad, New Year’s Eve dash to beat the fiscal cliff deadline, cinching a deal with President Barack Obama to raise taxes on the wealthy and temporarily freeze deep spending cuts but failing to get it through both chambers before midnight.
So over the cliff the country went — though perhaps for only a day or two and, assuming no snags, without incurring the double whammy of another recession and higher unemployment.

The measure, which would raise tax rates for families making more than $450,000 and delay deep across-the-board spending cuts for two months, cleared the Senate by an overwhelming 89-8 vote shortly after 2 a.m. The Republican-controlled House could take up the pact in a rare New Year’s Day session, though the timing of that chamber’s vote was not clear.

The $620 billion agreement was a major breakthrough in a partisan standoff that has dragged on for months, spooking Wall Street and threatening to hobble the economic recovery. It turned back the GOP’s two-decade-long refusal to raise tax rates, delivering a major win for the president.

The bill also canceled pay raises for members of Congress and averted an expected hike in the price of milk by extending expiring dairy policy.

Wow, they cancelled their own pay raises? That was big of them–not. They probably did that out of fear of an angry populace. And of course, we still have to watch the shameful spectacle of the tea party House wrangling over a deal that basically give them everything they wanted and more than they ever dreamed of.

From TPM, the Senators who voted against the deal:

The eight senators voting no were Michael Bennet (D-CO), Tom Carper (D-DE), Charles Grassley (R-IA), Tom Harkin (D-IA), Mike Lee (R-UT), Rand Paul (R-KY), Marco Rubio (R-FL), and Richard Shelby (R-AL).

Robert Reich calls it “A Lousy Deal on the Edge of the Fiscal Cliff.” I’m thinking that could be the new logo for this administration–“The Lousy Deal” as opposed to Roosevelt’s “New Deal.” Reich writes:

Details of the agreement reached by the president and congressional Republicans are still forthcoming, but from the look of it, Obama gave ground where he need not have.

What else is new?

Yes, the deal finally gets Republicans to accept a tax increase on the wealthy, but this is an inside-the-Beltway symbolic victory. If anyone believes this will make the GOP more amenable to future tax increases, they don’t know how rabidly extremist the GOP has become.

The deal also extends unemployment insurance for more than 2 million long-term unemployed. That’s important.

But I can’t help believe the president could have done better than this. After all, public opinion is overwhelmingly on his side. Republicans would have been blamed had no deal been achieved.

More importantly, the fiscal cliff is on the president’s side as well. If we go over it, he and the Democrats in the next Congress that starts later this week can quickly offer legislation that grants a middle-class tax cut and restores most military spending. Even rabid Republicans would be hard-pressed not to sign on.

I hate to say it, but it really looks like Obama pushed for this so he could give more away that he would have had to if we had just gone over the cliff without all the fake deal making.

Noam Scheiber writes at The New Republic: Democrats’ Cliff Compromise Is Bad; But the Strategic Consequences Are Disastrous.

I think the president made a huge mistake by negotiating over what he’d previously said was non-negotiable (namely, the expiration of the Bush tax cuts on income over $250,000). Then the White House compounded that mistake by sending Biden to “close” the deal when Harry Reid appeared to give up on it. As a practical matter, this signaled to Republicans that the White House wouldn’t walk away from the bargaining table, allowing the GOP to keep extracting concessions into the absolute final hours before the deadline….

I think a reasonable person can defend the bill on its own terms. The fact is that nudging up the tax threshold to $450,000 only sacrifices $100-200 billion in revenue over the next decade (against the $700-800 billion the administration would have secured with its original threshold), while allowing unemployment benefits to lapse would cause real pain to both the 2 million people directly affected and, indirectly, to the economy. Yes, Obama could have gotten the latter without giving up the former had he just waited another few days—at which point what the GOP considers a tax increase suddenly becomes a tax cut. But these things are always easier to pull the trigger on when you, er, don’t actually have to pull the trigger. I can’t begrudge Obama his wanting to avoid some downside risk for only a marginally better deal.

My far bigger gripe with the whole fiscal-cliff exercise has always been the strategic dimension—how it affects the next showdown with the GOP, and the one after that. Coming into the negotiation, Obama had two big problems: First, no matter how tough he talked, Republicans always assumed he’d blink in the end, for the simple reason that he pretty much always had. (This is one of the major themes of my book about his first term.) Second, despite the results of the most recent election, in which Obama won a fairly commanding victory on a platform of raising taxes on wealthy people, the GOP continued to believe that public opinion was mostly on its side. House Republicans cited the preservation of their majority—never mind that their own candidates received fewer total votes than House Democratic candidates—and polls showing most Americans still think government is too big.

No kidding. And I disagree that we shouldn’t begrudge Obama for not sticking to his promise to hold the line at $250,000. As I’ve written previously, Obama should not be involved in negotiations, because he either wants to lose to the Republicans or his need to please the people who hate him is just too strong. I don’t know which is the real problem, and it really doesn’t matter for practical purposes. He’s just a horrible negotiator, period. Now we have to watch another repulsive display of childish squabbling in a couple of months. Is this going to be the extent of what happens in Obama’s second term? With this incompetent, useless Congress, it’s entirely possible.

And of course we still have to wait and see what Boehner and his gang do.

In a joint statement late Monday, House GOP leaders promised to keep their commitment to act on the measure if it passes the Senate. But they say they won’t decide whether to accept the measure or to amend it and send it back to the Senate until lawmakers and their constituents have a chance to review the legislation.

Give me a frickin’ break! I’m going to end here, because there doesn’t seem to be much other news. What are you reading today. I look forward to clicking on your links.

Whatever else happens, I hope everyone has a great day today and a very happy new year in spite of the idiocy in Washington DC!!

Thursday Reads: Fiscal Cliff Crashes into Debt Ceiling, Villagers Blame Old People….And Other News

Posted: December 27, 2012 | Author: | Filed under: 2012 presidential campaign, Barack Obama, Fiscal Cliff, morning reads, Surreality, U.S. Economy, U.S. Politics, We are so F'd | Tags: , , , , , , , , , | 26 Comments

cat.rain

Good Morning!!

The storm has moved into New England, but it’s mostly rain up here–very hard, windy, noisy rain. I’m very grateful it isn’t snow, but I feel for all the people down south of me who are getting hit harder. Take care, everyone!!

Yesterday Tim Geithner announced that the U.S. will hit the debt ceiling on December 31. He sent a letter (pdf) (also posted on the Treasury Department website)to Harry Reid with cc’s to other Congresscritters informing them that the Treasury can fiddle around and keep things going for at the most two months before the U.S. defaults on its debts for the first time in history.

Meanwhile, no negotiations on the “fiscal cliff” took place yesterday. John Boehner appears to have abdicated all responsibility and has announced that it’s up the the Senate to act; but Senators are in no hurry to rush back to Washington DC and clean up the House Republicans’ mess.

U.S. House of Representatives Speaker John Boehner on Wednesday urged the Senate to pass its version of legislation to avert the “fiscal cliff,” in a sign that congressional efforts to avoid a budget crisis are coming back to life days ahead of the year-end deadline.

In a statement issued by Boehner and his top lieutenants, the Republican leadership team said “the Senate must act first” to revive efforts to avert the $600 billion in automatic tax hikes and spending cuts due to be triggered on Jan. 1.

They promised that the House would weigh whatever legislation the Senate produced.

What are we paying these incompetent idiots for anyway? But of course no one is talking about cutting Congresspeople’s salaries–the pressure is all on Social Security recipients. Yesterday, Ruth Markus wrote a column in support of cutting benefits because seniors and disabled people (including disabled veterans) are getting too much money (the average SS check is $1,200 per month). She thinks everyone should gratefully embrace the Chained CPI.

Here’s how the CPI works. When taxes are being calculated, brackets, standard deductions, personal exemptions and the like are ratcheted up with inflation, protecting taxpayers from being forced to pay higher taxes for what is essentially the same amount of income they had previously.

Benefits — everything from Social Security to veterans’ benefits to federal pensions — are similarly adjusted upward to protect beneficiaries’ buying power from being relentlessly eroded.

Such indexing makes eminent sense. The difficulty — and the money-saving opportunity — arises because, in the view of most economists, the current method of calculating changes in the CPI overstates the inflation rate.

It fails to account for what economists call upper-level substitution bias, and what my mother would call plain common sense: If the price rises for a certain commodity in the basket of goods used to measure inflation, consumers will choose a cheaper alternative. In my house, when the price of beef soars, we substitute chicken.

The CPI doesn’t and, as a result, taxpayers are undercharged and beneficiaries are overpaid — a lot. The overestimate is small — less than 0.3 percentage points annually but, much like compound interest, it adds up over time.

What Marcus doesn’t seem to understand is that when your income is that low, beef and chicken are are both too expensive and you substitute peanut butter and dried beans. Except that peanut butter prices have skyrocketed–what’s the next step down, cat food?

Two economists responded to Markus. Dean Baker at the CEPR: Ruth Marcus Is Outraged by Overly Generous Social Security Checks.

Well, who can blame her? After all, we have tens of millions of seniors living high on Social Security checks averaging a bit over $1,200 a month at a time when folks like the CEOs in the Campaign to Fix the Debt are supposed to subsist on paychecks that typically come to $10 million to $20 million a year.

Anyhow, her main trick for cutting benefits is to adopt the chained consumer price index as the basis for the annual cost of living adjustment. This would have the effect of reducing benefits by 0.3 percentage points for each year of retirement. This means a beneficiary would see a 3 percent cut in benefits after 10 years, a 6 percent cut after 20 years and a 9 percent cut after 30 years. This is real money. Since Social Security is more than half the income for almost 70 percent of retirees and more than 90 percent of the income for 40 percent of retirees, the hit to the affected population would be considerably larger than the hit to the top 2 percent from ending the Bush era tax cuts.

But Marcus insists this cut must be done first and foremost in the name of accuracy, since the chained CPI is supposed to provide a better measure of the cost of living. She notes but quickly dismisses the evidence from the Bureau of Labor Statistics (BLS) consumer price index for the elderly (CPI-E), which shows that the rate of inflation seen by the elderly is somewhat higher than the overall rate of inflation.

Read Baker’s upteenth explanation of why the Chained CPI doesn’t accurately reflect spending for seniors at the link. He argues for continuing development of a CPI that takes into account that seniors spend greater proportions of their income on health care and basic necessities that can’t necessarily be replaced with cheaper substitutes.

Next, Jared Bernstein says he’s “convinced the Chained CPI is coming” and it is a benefit cut. He agrees with Baker that an elderly CPI would be a good thing, but says that Markus’ argument we should cut benefits now and deal with the injustices later makes no sense.

…as Dean notes, it would make a lot of sense to invest in a chained-weighted CPI that accounts for the notably different buying patterns of the elderly. Ruth Marcus critiques this point today but for reasons that don’t make sense to me. For example, she criticizes an elderly price index that would more heavily weight health care spending because “the burden of higher health costs falls unevenly among the elderly. Average costs are skewed upward by a minority who face very high out-of-pocket expenses…”

But a) all the commonly used price indexes use average costs and are thus “skewed” up and down when the underlying distribution is uneven, and b) there’s little question that the ‘old’ elderly—the ones most hurt by the switch to the chain-weighted measure—face high out-of-pocket medical costs.

Marcus goes on to endorse, as do we at CBPP, [immediately switching to the Chained CPI but protecting “vulnerable people from the impact”] and this is clearly the administration’s view as well—in fact, they’ve built in offsetting benefits to the poor, old elderly into their plan. That’s very important and salutary and one reason why I nervously support the switch.

But I’m more concerned than Ruth appears to be with the possibility that the current politics get us the chained CPI without the necessary protections.

It certainly looks like President Obama will go down in history as the Democrat who cut the New Deal off at the knees unless he suddenly realizes his legacy matters to him. Remember way back when Social Security was “off the table” because it doesn’t contribute to the deficit? Oh wait–that was only two weeks ago.

Read the rest of this entry »

Someone Needs to Remind President Obama Who Won the Election

Posted: December 19, 2012 | Author: | Filed under: 2012 presidential campaign, Barack Obama, Republican politics, U.S. Economy, U.S. Politics | Tags: , , , , , , , , , | 53 Comments
Barack Obama's inner child?

Barack Obama’s inner child?

In November, President Obama won reelection cleanly and decisively–it was a landslide. Immediately after his victory, Obama appeared determined to stand up to Republican intransigence in the battle over the “fiscal cliff” and the debt ceiling. He “assured a gathering of progressive and labor leaders…”

“I am not going to budge,” he told the group, according to an attendee who relayed material from the meeting on condition of anonymity. “I said in 2010 that I’m going to do this once, and I meant it.”

….two other sources who attended the meeting confirmed the quote. The administration seems to have staked out a firmer position than during the first stand-off over the Bush-era tax cuts, in November and December of 2010, leaving the impression that it won’t sign off on a compromise that doesn’t increase the tax burden on the wealthy as a means of paying down the deficit….

Top Democrats in the Senate have said they would be comfortable letting all the tax rates expire — as they are scheduled to do — at the end of the year, after which they will put together a tax cut bill that would re-establish the Bush-era rates for incomes below $250,000.

As the talks began, the White House emphatically stated that Social Security was not part of the deficit and that cuts in this important program were off the table. But just a few weeks later, the odious New York Post is laughing at Obama for “caving” on Social Security. Why should Boehner negotiate in earnest when he knows his opponent–one of the most powerful men in the world–will eventually give in because of some perverse need to demonstrate “bipartisanship?”

A short time ago Obama gave a press conference in which he admitted,

“I have gone at least half way” to meet Republican concerns, Obama told reporters at the White House after he announced the formation of a special panel to recommend steps to prevent gun violence. “The fact that they haven’t taken it yet is puzzling.”

Obama’s offer includes raising tax rates on income above $400,000; increasing rates on capital gains and dividends to 20% from 15% for incomes above $250,000; and billions of dollars in cuts to health care and other programs.

While Obama has backed off on earlier proposals — including a $250,000 threshold for higher income taxes — Republicans continue to say that the president’s fiscal-cliff plan is flawed.

“It is not ‘puzzling’ to reject an agreement that…fails to remotely meet the test of balance [the president] himself has promised,” said Kevin Smith, a spokesman for House Speaker John Boehner, in a post on Twitter.

He’s sounding whiny again. Why is he so surprised? He’s like Charlie Brown with the football. Obama never seems to finally learn that if he stands strong against Boehner, he not only will defeat the Republicans but also he’ll earn the respect and support of the American people.

Markos has an interesting post at Dailykos that demonstrates this: It wasn’t Obama’s negotiating style that won him reelection. It almost cost him. Markos demonstrates with a chart and timeline that Obama’s approval rating rose and fell dramatically during his negotiations with Boehner over the debt ceiling last year.

President Barack Obama entered the debt ceiling negotiations with a net-negative approval rating. As House Speaker John Boehner became more belligerent and confrontational, Obama soared. The people were firmly behind him! But then he began offering concession after concession, hoping to seem “reasonable” and look like the “adult in the room,” and his numbers simply tanked. That’s a mathematical fact, not opinion.

He didn’t return to net-positive approvals until the Democratic convention this September. People didn’t reward Obama’s conciliatory approach to the negotiations. Rather, they saw it (rightly) as weakness, and reacted accordingly. No one likes a weak president.

Then Markos uses the 2012 exit polls to show that Obama was reelected despite his “leadership style,” because people sensed that the President really cared about their problems.

For those who based their choice on leadership, Obama got killed 61-38. And the president lost the “vision” and “values” questions handily as well. So how did he win? He cleaned up 81-18 with people who voted on which candidate cared about them the most. In other words, voters thought Mitt Romney was an aloof dick and trusted Obama most to look out for them. So maybe he should validate that trust.

Obama isn’t doing himself any favors by drawing lines in the sand and then inevitably capitulating.

Republicans have learned that there isn’t a negotiating stance that Obama won’t compromise. That doesn’t lend itself to smart negotiations. Rather, it creates unbalanced ones, as Republicans simply wait for Obama to cave on his demands. They’ve learned that for Obama, making a deal is more important than what’s in the deal.

Obama with dad

Why does Obama repeatedly do this? I can’t possibly know for sure, but I think he has inner child issues. We all have times when we regress back to a time in childhood when we were weak and had few options. It’s important to learn how to deal with that when it happens.

Obama needs to learn to remind himself that he’s no longer a small child abandoned first by his father and then by his mother–sent away to be raised by his grandparents. That must have been very difficult for him, but he’s not that sad, lonely little boy anymore. He’s the President of the United States, and those of us who voted for him need him to act like it.

Cutting Social Security and backing off the $250,000 income level for those who must pay more taxes is unacceptable. Not only will caving on these issues hurt seniors, disabled people, and force middle class and working class Americans to pay more than their share, but also giving in to Boehner’s demands will hurt Obama’s legacy and the Democratic Party as a whole. As David Johnson of The Campaign for America’s Future points out, “Social Security is Still the Third Rail,” and cutting it would be “political suicide.”

We JUST had an election where the public (not to mention Every. Single. Poll.) overwhelmingly said no cuts to Social Security or Medicare, and raise taxes on income over $250K. That ought to mean something. But the “word” out of DC is that a deal is underway that cuts the Social Security COLA and increases the income level subject to a higher tax from $250K to $400K.

Senators and Representatives who are thinking of touching the “third rail:” How many constituents are calling your office today to say, “Yes, I want you to cut the Social Security COLA”?
Cutting Social Security makes no sense, and is bad politics because it hurts people. Old people depend on this meager benefit and by law Social Security can not contribute to deficits. But never mind the numbers, look at the social and political effects of a deal that cuts the Social Security cost-of-living-adjustment (COLA) immediately after the public voted not to do this.

The social effect: Does our society care about people, or just about money? Cuts in Medicare, Medicaid and Social Security hurt PEOPLE. Raising tax rates on the wealthy is just money. What does it tell the public about our society if their government cuts Social Security benefits immediately after we have an election in which the public overwhelmingly votes against cuts in Social Security or Medicare, and to increase taxes on $250K and up? This reported deal raises that $250K to $400K, reduces military cuts, and ignores that the same amount of money could be raised in ways that actually help the country and economy, like a Financial Transaction Tax.

The AARP has come out strongly against applying the chained CPI to Social Security.

“Adopting the chained consumer price index for Social Security benefits will take $112 billion out of the pockets of current Social Security beneficiaries in the next 10 years alone, and is neither fair nor warranted.

“Social Security is currently the principal source of income for nearly two-thirds of older American households, and roughly one third of those households depend on Social Security for nearly all of their income. Half of those 65 and older have annual incomes below $18,500. Every dollar of the average Social Security retirement benefit of about $14,800 is absolutely critical to the typical beneficiary.

“The Chained CPI is a stealth benefit reduction that will compound over time and cut thousands of dollars in retirement income for current beneficiaries. A typical 80-year-old woman will lose the equivalent of 3 months worth of food annually. The greatest impact of Chained CPI would fall on the oldest, eventually resulting in a cut of one full month’s benefit annually. This dramatic benefit cut would push thousands more into poverty and result in increased economic hardship for those trying desperately to keep up with rising prices.”

Labor unions are also warning Obama to “Back off Social Security.”

The AFL-CIO is pushing President Obama to back off from Social Security benefit cuts in the “fiscal cliff” negotiations.

The nation’s largest labor federation sent an email Tuesday to activists asking them to email the White House and lawmakers and oppose the changes to Social Security that the president has offered to Speaker John Boehner (R-Ohio) in deficit-reduction package.

“Boehner has been talking to President Obama about cutting Social Security Cost-of-Living Adjustments (COLAs), which are especially important to keep inflation from eating away the benefits that seniors and people with disabilities depend on,” said the email, signed by Damon Silvers, the AFL-CIO’s director of policy.

“Email President Obama, your member of the House of Representatives and your senators to demand they reject House Speaker Boehner’s proposal to extend tax cuts for the rich and that they oppose COLA cuts and any other cuts to Social Security, Medicaid or Medicare benefits, regardless of who proposes them.”

These are the people who worked in the trenches to get out the vote and get Obama reelected despite the weak economy and high unemployment. But Obama the people-pleaser only seems to care about what the Republicans think of him. He probably knows intellectually that he’ll never get them to like him, but he just can’t help it. It’s as if Boehner somehow represents Barack Obama, Sr., the man who abandoned a little boy decades ago.

Obama needs to listen to the people who got him where he is and stop worrying about pleasing the people who hate him. He needs to listen to the AARP, Labor, and other progressive groups. It’s not too late to withdraw his latest offer–after all, Boehner has already rejected it and moved on to “Plan B.”

Take Social Security off the table, Mr. President.  Go back to your original stand on taxing incomes over $250,000. Your place in history and the well being of the American people depend on it.

Tuesday Reads: Delusional Republicans, Complicit Media, and Lots More

Posted: December 4, 2012 | Author: | Filed under: 2012 elections, Congress, Fiscal Cliff, Homeless, hunger, Medicare, morning reads, Republican Tax Fetishists, Romney-Ryan Budget Plan, Social Security, Surreality, The Bonus Class, The Media SUCKS, U.S. Economy, U.S. Politics | Tags: , , , , , , , , , , , , , , | 25 Comments

off-to-see-the-wizard

Good Morning!!

Yesterday the House Republicans made a so-called “counteroffer” to President Obama’s initial proposal for avoiding the fiscal cliff that basically consists of the Romney/Ryan plan that voters already rejected. The plan called for cutting Medicare by raising the eligibility age to 67, cutting Social Security by change the COLA, and supposedly “raising revenues” without raising rates on the rich–with specifics to be determined next year.

The White House rejected the offer immediately as basically a joke and will not be making a counteroffer, according to CNN’s Jessica Yellin.

Senior administration officials said the offer House Speaker John Boehner submitted to the White House on Monday wasn’t serious enough to merit a counter-proposal from the administration. So the president’s team plans to wait for the GOP to come around on the idea of raising tax rates or let the nation go over the fiscal cliff.

In a statement Monday White House Communications Director Dan Pfeiffer blasted the Republican plan, arguing it “does not meet the test of balance. In fact, it actually promises to lower rates for the wealthy and sticks the middle class with the bill.”

Like Dorothy in The Wizard of Oz, Republicans have gone over the rainbow and have lost touch with reality. They simply can’t accept that they lost the election, and they just aren’t in “Kansas” anymore.

The talk in DC is that the Republicans have talked about a “doomsday plan,” actually another tantrum in which they metaphorically throw themselves down on the House floor screaming and kicking until they get their way. According to ABC News’ Jonathan Karl:

Republicans are seriously considering a Doomsday Plan if fiscal cliff talks collapse entirely. It’s quite simple: House Republicans would allow a vote on extending the Bush middle class tax cuts (the bill passed in August by the Senate) and offer the President nothing more: no extension of the debt ceiling, nothing on unemployment, nothing on closing loopholes. Congress would recess for the holidays and the president would face a big battle early in the year over the debt ceiling.

Two senior Republican elected officials tell me this doomsday plan is becoming the most likely scenario. A top GOP House leadership aide confirms the plan is under consideration, but says Speaker Boehner has made no decision on whether to pursue it.

Under one variation of this Doomsday Plan, House Republicans would allow a vote on extending only the middle class tax cuts and Republicans, to express disapproval at the failure to extend all tax cuts, would vote “present” on the bill, allowing it to pass entirely on Democratic votes.

It’s a mystery what Republicans think they would gain by doing this, so I guess the childish temper tantrum metaphor continues to fit.

What bothers me even more than the Republicans’ nonsensical refusal to accept reality is that the media has apparently decided to go over the rainbow too and pretend that the childish tantrums make some kind of sense. During the presidential campaign, I got the feeling that corporate “journalists” were beginning to face up to reality when they began actually admitting that Mitt Romney’s was telling bald-faced lies with regularity. But no–they’re returned to the default position of pretending that “both sides do it.” A few days ago, Michael Grunwald wrote a great piece about this at Time’s Swampland blog: Fiscal Cliff Fictions: Let’s All Agree to Pretend the GOP Isn’t Full of It.

It’s really amazing to see political reporters dutifully passing along Republican complaints that President Obama’s opening offer in the fiscal cliff talks is just a recycled version of his old plan, when those same reporters spent the last year dutifully passing along Republican complaints that Obama had no plan. It’s even more amazing to see them pass along Republican outrage that Obama isn’t cutting Medicare enough, in the same matter-of-fact tone they used during the campaign to pass along Republican outrage that Obama was cutting Medicare.

This isn’t just cognitive dissonance. It’s irresponsible reporting. Mainstream media outlets don’t want to look partisan, so they ignore the BS hidden in plain sight, the hypocrisy and dishonesty that defines the modern Republican Party. I’m old enough to remember when Republicans insisted that anyone who said they wanted to cut Medicare was a demagogue, because I’m more than three weeks old.

I’ve written a lot about the GOP’s defiance of reality–its denial of climate science, its simultaneous denunciations of Medicare cuts and government health care, its insistence that debt-exploding tax cuts will somehow reduce the debt—so I often get accused of partisanship. But it’s simply a fact that Republicans controlled Washington during the fiscally irresponsible era when President Clinton’s budget surpluses were transformed into the trillion-dollar deficit that President Bush bequeathed to President Obama. (The deficit is now shrinking.) It’s simply a fact that the fiscal cliff was created in response to GOP threats to force the U.S. government to default on its obligations. The press can’t figure out how to weave those facts into the current narrative without sounding like it’s taking sides, so it simply pretends that yesterday never happened.

Dakinikat has written about this repeatedly, of course, but it’s nice to see it in the corporate media for a change.

Speaking of media madness, I don’t watch CNN much anymore but it seems like any time I click by the channel one of two people is on the air–Wolf Blitzer or Erin Burnett. Do they even have any other reporters working there in the afternoon an evening?

What’s the deal with having Erin Burnett covering serious news stories, even foreign policy stories? Burnett’s background is as co-anchor of a show on CNBC as an adviser to Donald Trump on Celebrity Apprentice! She recently “interviewed” Julian Assange and failed to ask him even one significant question.

Unfortunately, I don’t get Current TV, but apparently Cenk Uygur has been criticizing Burnett relentlessly for the past couple of years. Most recently, he accused her of ‘Guarding The Fortress’ By Abetting Gutting Of Medicare. From Mediaite:

“Erin Burnett is someone that represents the rich, powerful, the establishment, in my opinion,” Cenk said, “and you can see it in her CNN reports all the time.”

Cenk set up a clip from Burnett’s show, in which Rep. [Peter] DeFazio explains how deficit reduction can be achieved without gutting Medicare benefits. “Listen to her be incredibly incredulous about this,” he said, before playing a few snippets from OutFront.

“(President Obama) has said ‘Yes, I support raising the age on Medicare from 65 to 67,” Burnett says. “Simpson-Bowles talked about raising the age. Most people do, and say that’s really going to be the only way to get out of this. You really think we don’t have to make real changes, or is that just, I understand your constituents don’t want you to say anything…”

The implication is that DeFazio is opposing the change on nakedly political grounds, and not the merits of the policy.

“That doesn’t deal with the cost of prescription drugs,” Rep. Defazio replied, “and with overpriced and unnecessary medical care.”

“Fair,” Burnett interjects, as the clip cuts ahead to Burnett saying “Interesting point, but I still find it a little bit hard to believe. when you say we don’t have to make substantive change to a program that’s going to consume all of our federal spending if we keep going the way we’re going, we do need to make substantial changes. It’s going to hurt.”

See what I mean? As Dakinkat has said, CNN is trying to compete with Fox News, though not very successfully. But why are they doing it when their ratings keep falling? And why don’t they hire some real reporters?

Have you heard that former Republican presidential candidate Rick Santorum has begun blogging at right wing conspiracy site World Net Daily? According to Raw Story, Santorum’s first post is about a supposed UN conspiracy involving Harry Reid.

In keeping with the WND tradition of promoting various fringe conspiracies, Santorum’s debut column claimed that Senate Majority Leader Harry Reid (D-NV) has an objective of “ceding our sovereignty to the United Nations.”

Santorum warned that a United Nations Convention on the Rights of Persons with Disabilities treaty adopted in 2006 “has much darker and more troubling implications” than to simply improve the treatment of disabled people in other countries.

The staunchly anti-abortion Republican worried that the treaty would “put the government, acting under U.N. authority, in the position to determine for all children with disabilities what is best for them.”

And taking that thought to its absurd conclusion, Santorum suggested that the U.N. treaty would have meant the death of his daughter, who has a rare genetic disorder.

Sigh…

In more serious news, a very sad story this morning: David Oliver Relin, co-author of the book Three Cups of Tea, has committed suicide. Last year I wrote about a 60 Minutes report on the other co-author Greg Mortenson’s fabricated stories in the book. Relin was very disturbed by the revelations and had become deeply depressed, according to the NYT.

David Oliver Relin, a journalist and adventurer who achieved acclaim as co-author of the best seller “Three Cups of Tea” (2006) and then suffered emotionally and financially as basic facts in the book were called into question, died Nov. 15 in Multnomah County, Ore. He was 49.

His family said Mr. Relin “suffered from depression” and took his own life. The family, speaking through Mr. Relin’s agent, Jin Auh, was unwilling to give further details, but said a police statement would be released this week.

In the 1990s, Mr. Relin established himself as a journalist with an interest in telling “humanitarian” stories about people in need in articles about child soldiers and about his travels in Vietnam.

“He felt his causes passionately,” said Lee Kravitz, the former editor of Parade who hired Mr. Relin at various magazines over the years. “He especially cared about young people. I always assigned him to stories that would inspire people to take action to improve their lives.”

Relin obviously had no idea that his co-author Greg Mortenson was a fabulist.

And another sad story from the Times: Homeless Man Is Grateful for Officer’s Gift of Boots. But He Again Is Barefoot. You probably heard about the police officer who recently took pity on a homeless man whose feet were freezing and bought him a pair of $100 boots. Unfortunately the boots put the man’s life at risk.

After Officer Lawrence DePrimo knelt beside a barefoot man on a bitterly cold November night in Times Square, giving him a pair of boots, a photo of his random act of good will quickly took on a life of its own — becoming a symbol for a million acts of kindness that go unnoticed every day and a reminder that even in this tough, often anonymous city, people can still look out for one another.

Officer DePrimo was celebrated on front pages and morning talk shows, the Police Department came away with a burnished image and millions got a smile from a nice story.

But the unnamed homeless man was living in another, more painful reality.

His name is Jeffrey Hillman, and on Sunday night, he was once again wandering the streets — this time on the Upper West Side — with no shoes.

The $100 pair of boots that Officer DePrimo had bought for him at a Skechers store on Nov. 14 were nowhere to be seen.

“Those shoes are hidden. They are worth a lot of money,” Mr. Hillman said in an interview on Broadway in the 70s. “I could lose my life.”

Meanwhile, years of Republican rule in New York City have led to skyrocketing homelessness in the city. From Alternet: How One GOP Plutocrat Helped Make 20,000 Kids Homeless

There are 20,000 kids sleeping in homeless shelters in New York City, according to the city’s latest estimate, a number that does not include homeless kids who are not sleeping in shelters because their families have been turned away. Up to 65 percent of families who apply for shelter don’t get in , and their options can be grim.

“Some end up sleeping in subway trains,” Patrick Markee, senior policy analyst at Coalition for the Homeless, tells AlterNet. “Some go to hospital emergency rooms or laundromats. Women are going back to their batterers or staying in unsafe apartments.”

Families that make it into shelters are taking longer to leave and move into stable, permanent housing. Asked by reporters why families were staying 30% longer than even last year, Mayor Michael Bloomberg said, “… it is a much more pleasurable experience than they ever had before.”

Man, that’s cold. Bloomberg could probably help all those homeless kids with money out of his own pocket and not even notice it, but instead he has banned gifts of food to the homeless even after Hurricane Sandy!

The edict, issued last March by Mayor Bloomberg, is part of a larger move by the city’s Department of Homeless Services (DHS) that dictates serving sizes and other nutritional requirements. These include limits on calorie contents, minimum fiber amounts and condiment recomendations [sic]….

Mayor Bloomberg’s clampdown on food donations can be seen as a greater restriction on New Yorker’s freedom to eat or drink what they want. He banned the sale of sugary drinks larger than 16 ounces last September, baby formula to new mothers in local hospitals last July, smoking in parks and open spaces in May 2011, implemented a plan in January 2010 to cut the amount of salt in packaged and restaurant food, forced fast food restaurants to post calorie content in October 2007, and forbid restaurants from using trans fats in cooking oils in 2006.

Real human beings are cold and hungry, and Bloomberg is worried about calorie control and nutritional requirements!

Uh-oh. This post has gotten way too long and I’m way to late in putting it up, so I’ll end on this down note. I hope you’ll have some more upbeat stories to share in the comments.

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