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Here’s what I want to know

Here’s the Dow over the past year:

Screen Shot 2013-03-01 at 1.34.50 PM

What I want to know: Is the recent surge above 14000 due to the prospect that the cuts to the social insurance programs was a fait accompli?  Or is it just because the financiers have free and unfettered access to the treasury in the form of trillions of dollars of our money?

What would happen if the sequester continues for a period of time but the social insurance cuts, specifically to Social Security, are off the table?  Will The Market sink like a stone?  I want to know who is really in charge here.

So, let the sequester happen and let’s not rush to negotiate an end to it.

Let’s see what happens.

So, all we need to do is add “Leadership Council” to our soiree

I was reading Krugman today about how Starbucks did a Komen with the “Come Together” campaign to make customers pressure their Congress reps and senators to shred the social insurance programs when I decided to look up the infamous “Fix the Debt” website.  It’s run by some shadowy group of rich people called the CEOs Fiscal Leadership Council.

Starbucks does a Komen

The CFLC is populated by the usual suspects of deadbeat corporate executives that we’ve seen in the past 4 years.  The CEO’s of Citigroup, Bank of America, Goldman Sachs, JP Morgan Chase and AT&T are on the list.  But so is T. Rowe Price, the 401K specialists.  (There couldn’t be a conflict of interest there, could there?  Nahhhh)  According to the Huffington Post, the CFLC consists of some of the most notorious pension plan underfunders.  Isn’t that sweet?  They are leading us to give up the only means of surviving in old age after they raid their company pensions to pay those M&A bonuses.  Now that’s Leadership.

Then I got to wondering, who commissioned this group?  I mean, was there a Congressional decree?  Did the President assemble this meetup of malefactors?  Because, how else did they get the “Leadership Council” thing in the title?  Who do they think they are leading?  I don’t remember asking for leadership off the so-called “fiscal cliff”.  I’m wracking my brains trying to figure out who appointed these guys, and they are almost all guys.  Wait, let me check.  There are 4 recognizably female names on a list of approximately 150 members. Good job, guys!  Does that mean women can’t be leaders or that they resist being lead?  Clarification is needed here.

And then I started to think, why don’t we left of center unpaid pundits (yes, I do flatter myself. If I don’t, no one else will) have a leadership council or many leadership councils?

For example, where is the Senior Research Investigators Leadership Council that will put pressure on Congress to stop listening to whiny pharma CEOs who keep telling our elected officials that they can’t find good help anymore?

How about a New Deal Democrats Leadership Council to tell Congress to stop listening to whiny rich CEOs that robbed us blind in the past four years?

Or a Dirty Fucking Hippy Leadership Council to tell Congress to get its shit together and do the right thing before we get our shit together and run against them?  Just an idea.

Or a La-La-La I Can’t HEAR You Leadership Council that will help Americans kick the cable TV news and talk radio habit so they’ll stop being suckered in by self-interested CEOs whose messages clog the airwaves.

Add your Leadership Council titles and purposes in the comments section.  I formally commission the best Leadership Council idea.  No, no, don’t thank me.  I take on this burden of Leadership for You.

Ok, here’s my theory about why the Masters of the Universe want to kill the social insurance programs

Remember what I said about Wall Street workers?  Let me refresh your memory:

The finance class actually consists of a bunch of overqualified strip miners.  They’re overworked, which might explain the number of bad decisions they make, and their compensation system decouples the consequences of their actions from the actions themselves.  They are being paid to make “deals” and the purpose of those deals is to extract “wealth”.  In a way, it’s not that much different from getting into the cab of some giant piece of earth moving equipment and mowing down the side of the mountain and then loading that potential ore onto a conveyor belt to be separated from dirt.  They live in a “company” town and are paid “company scrip”.  It’s a truck system for them as well.  The compensation is not proportional to the amount of work they do, they can be fired at will and they’re never going to leave that mountain because they owe their souls to the company store.  The more they work, the more compensation in bonuses they are promised but it’s never enough.

Once you think about this metaphor of Wall Street doing the work of strip miners, the present set of circumstances will start to make a lot of sense.

We know that Social Security does not add to the deficit.  In fact, we have a trust fund worth almost $3 trillion dollars.  Sure, that trust fund has taken a hit in the past four years because so many people are out of work and can’t pay their taxes but once people are working again, the kitty will start to grow again.  And if all that is needed is a couple of tweaks to solve the minor shortfall, it’s really not as damaging to the economy or rich people’s ability to spend ungodly amounts of money on themselves as they pretend.

So, it’s not a deficit problem- at least not from the government’s side of things.  Sure, Medicare does need to be fixed but that requires some spine stiffening on the part of the Democrats to crack down on providers.  Did I tell you about my lab partner’s husband’s 4 hour hernia operation and recovery in the hospital?  $70,000.  No, that is not a mistake.  There’s something truly out of whack when if comes to costs and payments to hospitals, doctors, insurance companies.  It’s a real problem.  And since the rest of the developed world has found reasonable solutions at much lower costs, it’s moronic for our elected officials to tell us that the costly ACA, with downstream repercussions they failed to study, is the best we can do.  Please, do we look stupid to you?

Anyway, back to Wall Street.  The Social Security trust fund is solid and fixable and millions of us late boomers paid into the surplus funds to cover our own retirements.  What isn’t solid and fixable is the 401K system, which really is a Ponzi scheme.  Pretty soon, a lot of aging baby boomers will be taking money out.  That’s going to hurt someone’s bottom line.  The bonuses and skimming going forward isn’t going to be nearly so lucrative as it was over the past two decades.  After the Baby Boom came the Baby Bust in the late 60’s.  Looks like The Pill really caught on in a big way.

In the past couple of decades, many companies ditched their pensions for the 401K.  Let the kids pay for their own retirements.  None of this deferred compensation crap.  And life was good for the shareholders and the bankers.  But once that money starts to get withdrawn, the salad days will be over.  So, Wall Street must get more people into 401Ks or they won’t be able to continue strip mining.  The problem is that most people are already in one if their employer offers it.  The market is finite and pretty soon will plateau.  At some point, the investment portfolios are also going to reach a steady state.

BUT, if you raise the retirement age and keep a lot of older people working, they will be forced to put their money back into the market.  Well, they won’t be able to retire until they’re much older than their parents were at retirement.  If they have any hope of ever taking time out to go travel or garden, they’re going to have to risk their money in the market, hope that it will pay off so they can get out of the job market before they’re dead and forget about social security.

My theory is that raising the retirement age forces more savings to stay in the market longer and that with a pool of people who can’t retire yet still working, the amount of money going into 401Ks and IRAs is going to go up. Stripville!

It makes sense from a timing perspective.  There’s really no need to cut a deal with Republicans right now.  The Democrats have enough seats to keep things pretty much unchanged.  If the tax cuts expire, it’s going to look bad for Republicans to hold middle class tax cuts hostage in order to satisfy their rich friends.  In fact, just about anything the Republicans stamp their feet and insist on is going to look bad for them.

But Obama still wants to cut a deal and make us all a lot poorer as a nation and as individuals.  And he really doesn’t have to do this.  So, why do it?  I think it’s because the strip miners have told him that if he doesn’t, the market is going to start to drop and it will pick up speed and saving the banks is the most important thing ever!!!  All serious people agree about this.  If he doesn’t cut the social insurance programs in order to prop up the 401K system, it will be all his and the Democrats’ fault when the market finally starts to fall.

Yep, that would suck for seniors who are about to retire so if I were them, I’d start looking around for other places to put that money.  But history has shown that Obama and his droogs at Treasury will bend over backwards to please bankers even if it means opening a revolving line of credit for the bankers to the taxpayer cash stream in perpetuity.  (Read Neil Barofsky’s book for more horrific details).

It’s been my feeling that the 401K is behind a lot of what’s really messed up in our economy and for some reason, we never hear anyone of sufficient gravitas talking about it.  But just imagine what would happen to the economy if we tried to phase it out even if most of us hate it with a white hot passion.

All hell would break loose.

Boogiemen and Clubs

The Third Way picking off sleepers in the Mead Hall

I’m trying to find the motivation to write anything in the last couple of days.  The small evil group who runs the world and to whom no one we know belongs seems determined to take away our social insurance benefits that we pre-paid.  I was on my way home from Philly last night listening to All Things Considered and let me tell you, there is a reason why I gave up NPR news programs back in the mid Naughties.  Last night, they interviewed some asshole from a casino corporation who is advising the president on the “fiscal cliff” from the business perspective.  I don’t remember his name (and for some reason, I can’t find the clip) but I was so infuriated after his little spiel that I could barely drive.  Here’s a summary of what he said:

He recognizes that the current economic environment is bad.

He thinks we need to cut back on “entitlements”.

He thinks that the American people need stability and something they can count on beyond the next quarter.

He thinks that social security can be replaced with something that works better.

He is convinced that if taxes are raised on the wealthy, they won’t have enough money to spend in casinos, leading to job loss.

Here’s what he really meant:

His business is suffering because not enough people are gambling.  They’re actually more concerned with keeping their houses than losing them, if it can be believed.

He doesn’t want to pay the employer’s part of social security.  Well, neither do I but now that I am self-employed, I am paying both parts and since it is MY MONEY, social security is the best way to ensure I have something to retire on.

He thinks it’s a bad idea to make Americans uncertain about their economic futures with layoffs and stuff because it means fewer people are going to gamble.  So, getting people back to work and stable is a good thing, mostly for him but if it turns out to be good for the average American, that’s good too. For some reason, like many business people, he seems to have a blind spot where the social insurance programs are concerned.  Making Americans more secure about their retirement futures might just get them to visit a casino in their younger years.  On the other hand, people like myself, who are unlikely to ever make the money I did a year ago are going to sock money away in a mattress and never visit a casino ever if there’s no social security on the horizon or a paltry sum compared to what we were lead to believe (I’ll address that a little later).  So, Mr. Casino man really needs to think this through.  Or maybe he has thought it through and has been convinced by his consultants that the illogic of his contradictory thoughts will not get much scrutiny from the NPR interviewers.  The consultant, probably from the company Mr. Grinch Consultants Inc, was correct.

He seems to have in mind a replacement for Social Security and Medicare.  We can count on his suggestion to have something to do with the private market.  That means there will be an administrator raking in the big bucks.  This is completely unnecessary.  Social Security is the best run government agency we have with very low overhead.  It’s extremely efficient.  Therefore it must be dismantled. This reminds me of the interview I heard on Ann Applebaum’s book about the Iron Curtain last night on the BBC History Extra Podcast.  When the Communists took over Eastern Europe, they were determined to put their ideological stamp on the economy.  When their plans failed, they blamed everything but communism. For example, if there was a private grocery store that everyone wanted to go to and as a result, the state store was suffering, the ideologues reasoned that the problem was the private store was making the state store look bad.  Solution: Close the private store.  In our case, the business community is upset that Social Security, being socially secure, is making their privatization schemes look bad.  So it must be replaced. To me, this demonstrates that the problem is not necessarily communism vs capitalism.  The problem is ideologues.

I don’t even know what to say about the wealthy, taxes and gambling.  It seems to me that the way they got to be so wealthy is that they figured out a way of gambling without suffering any losses.  Now, they have more money than they can spend in several lifetimes.  Surely the casino owner is not expecting me to feel sorry for them that need to pay a little more in taxes. If they want to gamble and be entertained, a slight increase in taxes isn’t going to prevent that. Besides, this conflicts with his other statements about the stability of the economy to average Americans.  There are very few really rich people, even though they have a disproportional share of the wealth.  Therefore, even though the level of luxury, entertainment and gambling they demand is high, it is limited by the monetary barrier of access.  There may be a high ratio of servant/employee to wealthy dudes but it’s a niche market.  On the other hand, there are millions of working and middle class people who can afford to gamble a little bit of money and take in a Cirque du Soleil show.  In this respect, I see the casino owner not that different from a car company owner.  You’re going to sell a lot more Ford Focuses and Toyota Camrys than Maybachs or even Lexus SUVs.  He’s going to get more bang for his buck by selling more affordable sedans.  In this case, the casino owner is correct to assert that working and middle class people need more economic stability but he’s not really making a case for sparing the upper class from tax increases.  The wealthy are not going to find themselves suddenly homeless and unable to afford a vacation in Vegas.  If he expects more middle class people visiting Las Vegas to have a bit of money to spend then there’s no reason to think that the wealthy are going to suddenly cut back because they get hit with a small tax increase.  Besides, the employees who previously served the rich hand and foot can be reallocated to serve the middle class guy from California less lavishly.

Does that make sense?  I am not an economist after all but this doesn’t appear to be rocket science.  (I am also not a rocket scientist)

Anyway, would someone please tell me WHY the president needs so much input from the business community??  Just because they have an opinion, and it always seems to involve killing the social insurance programs, doesn’t mean that the opinion is a good one.  Nor does it mean that it must be followed.  We do not need to compromise with people who are going to kill the economy down the road when future seniors have no money to spend.  The president needs to hear from more people like myself and my colleagues who were mailed out little retirement account booklets by our companies when were were still employed that showed what our incomes were going to be like 30 years in the future based on pensions, 401K savings and SOCIAL SECURITY.  Yes, the company factored that in.  I have saved some of my little booklets and would be happy to share them with any politician or president who is thinking of tinkering with the formula that all of us working people relied on decades years ago.  Did we pay that money or didn’t we?  And if we did, we want it.  All of it.  We earned it.

By the way, I don’t think there is a good place to cut off Social Security and Medicare benefits.  No matter where you do it, there are going to be people who are unfairly penalized because they were born a few months too late.  That’s going to create a lot of resentment, anger and unless the economy improves and employers decide to hire everyone between the ages of 45 and 70 without any penalty, it’s an unworkable and unfair plan.  And as a citizen of this country who paid a lot of money in taxes in the past couple decades of working, in New Jersey, no less, where we lose 39 cents for every dollar we send to DC, I deserve to be heard and treated with as much respect as some Sheldon Adelson wannabe.

So, this is where I turned off NPR because high blood pressure and driving on 95 at rush hour is not a good combination.

Now, on to the boogiemen.  I have been told that the Third Way and the DLC and the neoliberals are an unholy alliance and they are planning a ritualistic sacrifice where they stand around in a circle in dark robes and masks and watch General Petraeus and his biographer have sex while they slaughter a goat or some such thing.  And I have been  told that I am not taking their threat seriously because I have made fun of them and said “boo!” to the boogiemen.

But here’s the thing: I don’t like ANYONE who plans to strip our social insurance programs or offer us a “truck system” in its place or wants to substitute a 401K, which really is like gambling against the house, or wants to means test or take away Tricare from my mother or any other stupid, ill-conceived, hard hearted, ruthless, callous, sociopathic pro-casino owner plan.  No, I do not.  I don’t care if they are Third Way or Republicans or neoliberals or just passive progressive Democrats who fold the minute a Tea Partier stirs up a breeze.

The problem is not that these people are organized and determined.  The problem is that WE are NOT.

It doesn’t do us any good to worry about the enemy if we don’t have a plan to rally the troops to fight back.  And this is the awful legacy of the Obama years: he has completely dismantled the new deal coalition of left of center partners.  We won’t go into all of the details of what Obama is all about or his character traits (or lack thereof) or how the left was deceived and betrayed or how they could have used the threat of Hillary Clinton to shake Obama to the core during the 2012 election year and decided to pass on it for some unfathomable reason or neglected to pressure any candidate or party at all during 2012 or any of that.  It’s too late to hold Obama’s feet to the fire now since he’s re-elected and the left didn’t protest- at all.  What I am saying to all of you out there who are worried about losing the social insurance programs is that you can’t do anything about the tidal wave that is headed your way if you do not join together and push back.

We need to organize and do it quickly.  I have suggested an umbrella group called a Federation for Democratic Reform based on the Christian Coalition model.  The purpose would be to organize a voting bloc, to lobby effectively, to vet candidates and to promote the policies that we want to see.  Since we are as uncooperative as cats, I suggest we adopt the “12 Word Platform” and make holding the line on the social insurance programs as our first goal.

Now, I am an idea rat.  I am not good at organizing.  You should see my file cabinet and my car.  But I am good at spotting trends.  And the trend that I see is despite the crowds and protests in Greece and Spain, the governments in both countries are totally ignoring what the people actually want. We’re next.  And while Greece has a real problem with its tax system, the US does not.  There is no reason why the 300+ million of us have to tolerate the theft of the money that the wealthy took for their ridiculous tax cuts in the past 30 years.  We shouldn’t have to put up with the dismantling of our social insurance programs simply because Wall Street wants more money to put on the global craps table.  We don’t need to endure failing infrastructure and expensive wars and have a bunch of wealthy media people running around like chickens with their heads cut off hysterical about some “fiscal cliff”.  As the famous quote goes, “Your inability to plan ahead does not constitute an emergency for me”.  In this case, it is beyond offensive that anyone in the media or government should make any of us working and middle class people feel sympathy for the absurdly wealthy or shame that we are asking for our money back or urgency to put all of our skin in the game so that the wealthy don’t have to put any in the game at all.  Fuck that shit.

What is lacking here right now is the ability of the new deal proponents to coalesce and say FUCK THAT SHIT!  That is what is needed.  I would like to hear a discussion in the left blogosphere of how we intend to get the band back together.  No more discussion of Third Way boogiemen.  There are all kinds of boogiemen out there.  What I want to hear is how many of us are going to grab our weapons, join together and go out of the mead hall to fight the Grendels out there.  Anyone who starts wordsmithing and getting in a snit about who they will and won’t stand next to should be offered the opportunity to go out into the night by themselves to fight the monster alone.

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