Monday, June 27, 2011

The Arizona Campaign Finance Law: The Surprisingly Good News in the Supreme Court’s New Decision

A rare piece of good news by Rick Hasen in The New Republic:

The Roberts Court seems to have retreated from the suggestion that all campaign finance laws, aside from disclosure, are in constitutional trouble. Citizens United was a case dealing with independent campaign spending, and in its decision the Court was careful to say it was not messing with the other major type of campaign finance law: contribution limits. Controlling the amount of money going to candidates and raised by candidates is a key anticorruption tool. Yet there was language in Citizens United suggesting that even contribution limit laws could be subject to strict scrutiny, meaning they might likely be struck down as violating the First Amendment speech rights of candidates or contributors.

In today’s Arizona opinion, however, the Court confirmed that Citizens United did not overturn the law related to contribution limits, finding these restrictions “less onerous” and to be upheld under a “lower level of scrutiny.” That’s important, because opponents of campaign finance laws such as conservative attorney Jim Bopp have been going around citing Citizens United in their attempts to get contribution limits struck down left and right.

Oil Industry Forms New Astroturf Group to Manipulate 2012 Republican Primary in Iowa

This from Think Progress:

Keith Olbermann on on "Citizens United v. Federal Election Commission"

From June, 2010

Income Inequality

From Jared Bernstein:

Back in 1979, the average income of the top 1% was about 33 times that of the bottom fifth.  In 2007, that ratio had grown to 100.  The real income of middle-class households grew 19% over these years, less than 1% per year, while that of the top 5% grew by about 150% and the top 1%, by 240%.


Saturday, June 25, 2011

How the U.S., on the road to surplus, detoured to massive debt

From the Washington Post:

In January 2001, with the budget balanced and clear sailing ahead, the Congressional Budget Office forecast ever-larger annual surpluses indefinitely. The outlook was so rosy, the CBO said, that Washington would have enough money by the end of the decade to pay off everything it owed.

Now, instead of tending a nest egg of more than $2 trillion, the federal government expects to owe more than $10 trillion to outside investors by the end of this year. The national debt is larger, as a percentage of the economy, than at any time in U.S. history except for the period shortly after World War II.

From surplus to debt
SOURCES: Pew Fiscal Analysis Initiative analysis of CB

Polls show that a large majority of Americans blame wasteful or unnecessary federal programs for the nation’s budget problems. But routine increases in defense and domestic spending account for only about 15 percent of the financial deterioration, according to a new analysis of CBO data.

The biggest culprit, by far, has been an erosion of tax revenue triggered largely by two recessions and multiple rounds of tax cuts. Together, the economy and the tax bills enacted under former president George W. Bush, and to a lesser extent by President Obama, wiped out $6.3 trillion in anticipated revenue. That’s nearly half of the $12.7 trillion swing from projected surpluses to real debt. Federal tax collections now stand at their lowest level as a percentage of the economy in 60 years.

Big-ticket spending initiated by the Bush administration accounts for 12 percent of the shift. The Iraq and Afghanistan wars have added $1.3 trillion in new borrowing. A new prescription drug benefit for Medicare recipients contributed another $272 billion. The Troubled Assets Relief Program bank bailout, which infuriated voters and led to the defeat of several legislators in 2010, added just $16 billion — and TARP may eventually cost nothing as financial institutions repay the Treasury.

Obama’s 2009 economic stimulus, a favorite target of Republicans who blame Democrats for the mounting debt, has added $719 billion — 6 percent of the total shift, according to the new analysis of CBO data by the nonprofit Pew Fiscal Analysis Initiative. All told, Obama-era choices account for about $1.7 trillion in new debt, according to a separate Washington Post analysis of CBO data over the past decade. Bush-era policies, meanwhile, account for more than $7 trillion and are a major contributor to the trillion-dollar annual budget deficits that are dominating the political debate.

Phony Deficit Hawks

This from Paul Krugman:

So, just to summarize: Republicans are deeply, deeply concerned about the budget deficit; they believe that our nation’s future is at stake.

But they’re willing to sacrifice that future, not to mention risk the good faith and credit of the federal government, rather than accept so much as a single penny of tax increases as part of a deal.

Given all that, it seems almost redundant to mention that federal tax receipts as a percentage of GDP are near a historic low:

Federal receipts as % of GDP

So what’s it all about? The answer, of course, is that the GOP never cared about the deficit — not a bit. It has always been nothing but a club with which to beat down opposition to an ideological goal, namely the dissolution of the welfare state. They’re not interested, at all, in a genuine deficit-reduction deal if it does not serve that goal.

Friday, June 24, 2011

10 Things the GOP Doesn't Want You to Know About the Debt

The Daily Kos lists the 10 Things the GOP Doesn't Want You to Know About the Debt

This is why the US needs to quit whiplashing back and forth between Liberal and Conservative leaders



Ronald Reagan increased the National Debt by almost 200% while increasing spending by 73%. Bush I increased the debt by 51% (4yrs) and spending by 83%.. Clinton increased Debt by 32% (1.4 trillion) and spending by 31% (454 B). Bush II added 100% (4 trillion) to the Debt and 46% (861B) to spending. By the time Obama took office, the country was suffering from a Bush economic freefall. In the last 4 months of his term, Bush was losing a million jobs a month. He ended up with jobs growth of less than a million over 8 years. Reagan created 16 million jobs (17%). Clinton created 23 million jobs (20.6%). Reagan increased government size by 100,000 jobs … Clinton reduced government size by 290,000.

Thursday, June 23, 2011

Using German ingenuity to fix our economy

This from David Leonhardt at the NY Times:

The first lesson is that it’s really possible to make government more efficient. Like much of Western Europe, Germany long had a unemployment benefits system that discouraged work. But almost a decade ago, it began to make some changes.

It cut many benefits, in both duration and level, and it reduced the incentives to retire early. It also began trying to move the long-term unemployed into the labor force.

Specifically, the government took a fresh look at people who had not worked in years to determine who could and couldn’t work. The able and healthy were matched with potential employers. If they took a low-paying job, which was often the case, they would still receive a small portion of their benefits for a time. If they refused to work, their benefits were reduced anyway.

“The incentives to take up work were strengthened,” says Felix Hüfner of the Organization for Economic Co-operation and Development, “and also the sanctions were strengthened.” Sure enough, the reforms have nudged more people back into the labor force — and work tends to beget more work, as people develop skills and have more money to spend.

In the United States, short-term jobless benefits are not generous enough to be a major problem. But the Social Security disability program, which is one reason nearly 20 percent of working-age American men are not working, would benefit from some German-like reforms. So would those public sector pensions that encourage people to retire at 55 or 60.

Beyond the job market, Germany has also made a big effort to improve its education system. Eric Hanushek, a Stanford University economist, notes that Germany’s performance on the main international math, reading and science tests have become such a matter of national concern that the name of the tests — Pisa — is now a household word. “In the U.S.,” he says, “Pisa is still a bell tower in Italy.”

The math scores of German students have risen significantly since 2000, extending their existing lead over American students. Germany’s national average is now higher than the average in Massachusetts, this country’s top-performing state. And there is obviously a connection between strong technical skills and a strong manufacturing sector.

But the German story is not merely about making government more efficient. It’s also about understanding the unique role that government must play in a market economy.

That role starts with serious regulation. American regulators stood idle as the housing bubble inflated. German banks often required a down payment of 40 percent.

Unlike what happened here, German laws and regulators have also prevented the decimation of their labor unions. The clout of German unions, at individual companies and in the political system, is one reason the middle class there has fared decently in recent decades. In fact, middle-class pay has risen at roughly the same rate as top incomes.

The top 1 percent of German households earns about 11 percent of all income, virtually unchanged relative to 1970, according to recent estimates. In the United States, the top 1 percent makes more than 20 percent of all income, up from 9 percent in 1970. That’s right: only 40 years ago, Germany was more unequal than this country.

Finally, there are taxes. Germany does not have a smaller budget deficit because it spends less. Germany, you’ll recall, is the original welfare state. It has a smaller deficit because it is more willing to match the benefits it wants with the needed taxes. The current deficit-reduction plan includes about 60 percent spending cuts and 40 percent tax increases, Mr. Hüfner says. It’s like trying to lose weight by both eating less and exercising more.

As I suggested before, the American economy’s strengths may still be greater than the German economy’s. But Germany sure does seem more serious about dealing with its weaknesses.

And us? Well, lobbyists for the mortgage bankers and the N.A.A.C.P. have recently started pushing for less stringent standards for down payments. Wall Street is trying to water down other financial regulation, too.

Some Democrats say Social Security and Medicare must remain unchanged. Most Republicans refuse to consider returning tax rates even to their 1990s levels. Republican leaders also want to make deep cuts in the sort of antipoverty programs that have helped Germany withstand the recession even in the absence of big new stimulus legislation.

There is no getting around the fact that financial crises wreak terrible damage. It’s too late for us to prevent that damage, and it will take a long time to recover fully. It is not too late to learn from our mistakes.


Incredible Shrinking Workers’ Income

From the Frum Forum:


Workers’ share of U.S, national income is collapsing. What’s behind it?  According to Jared Bernstein: Globalization, “labor-saving” technology, much diminished union power, declining minimum wages, “financialization” of growth, tax incentives favoring capital (though these numbers are all pretax, the incentives still play a role), and what Harold Meyerson the other day called shareholder vs. stakeholder capitalism.

Medicare and Medicaid Control Costs Better than Private Insurance

This is from Paul Krugman:

And here’s what you need to know: Medicare actually saves money — a lot of money — compared with relying on private insurance companies. And this in turn means that pushing people out of Medicare, in addition to depriving many Americans of needed care, would almost surely end up increasing total health care costs.

The idea of Medicare as a money-saving program may seem hard to grasp. After all, hasn’t Medicare spending risen dramatically over time? Yes, it has: adjusting for overall inflation, Medicare spending per beneficiary rose more than 400 percent from 1969 to 2009.

But inflation-adjusted premiums on private health insurance rose more than 700 percent over the same period. So while it’s true that Medicare has done an inadequate job of controlling costs, the private sector has done much worse. And if we deny Medicare to 65- and 66-year-olds, we’ll be forcing them to get private insurance — if they can — that will cost much more than it would have cost to provide the same coverage through Medicare.

Wednesday, June 22, 2011

Thirty-Two Corporations Spent More on Compensation for Top Executives in 2010 Than They Paid in Income Taxes

This From Truth-Out. Excerpt:

Over the last few decades, executive pay at large corporations has skyrocketed. Today, American CEOs make 263 times the average compensation for American workers, up from the 30 to 1 ratio in the 1970s. In 2010 alone, CEO pay went up 27 percent while average worker pay went up just 2 percent.

Stop panicking over the debt and listen to Pimco's Bill Gross

Great article by the "Bond King" Bill Gross. Excerpts:

Solutions from policymakers on the right or left, however, seem focused almost exclusively on rectifying or reducing our budget deficit as a panacea. While Democrats favor tax increases and mild adjustments to entitlements, Republicans pound the table for trillions of dollars of spending cuts and an axing of Obamacare. Both, however, somewhat mystifyingly, believe that balancing the budget will magically produce 20 million jobs over the next 10 years.

Both parties, in fact, are moving to anti-Keynesian policy orientations, which deny additional stimulus and make rather awkward and unsubstantiated claims that if you balance the budget, “they will come.” It is envisioned that corporations or investors will somehow overnight be attracted to the revived competitiveness of the U.S. labor market: Politicians feel that fiscal conservatism equates to job growth. It’s difficult to believe, however, that an American-based corporation, with profits as its primary focus, can somehow be wooed back to American soil with a feeble and historically unjustified assurance that Social Security will be now secure or that medical care inflation will disinflate.

Additionally and immediately, however, government must take a leading role in job creation. Conservative or even liberal agendas that cede responsibility for job creation to the private sector over the next few years are simply dazed or perhaps crazed. The private sector is the source of long-term job creation but in the short term, no rational observer can believe that global or even small businesses will invest here when the labor over there is so much cheaper. That is why trillions of dollars of corporate cash rest impotently on balance sheets awaiting global – non-U.S. – investment opportunities. Our labor force is too expensive and poorly educated for today’s marketplace.

Government must step up to the plate, as it should have in early 2009. An infrastructure bank to fund badly needed reconstruction projects is a commonly accepted idea, despite the limitations of the original “shovel-ready” stimulus program in 2009. Disparate experts such as GE’s Jeff Immelt, Fareed Zakaria, Jeffrey Sachs and Paul Krugman believe an infrastructure bank to be an excellent use of deficit funds: a true investment in our future. While the current administration admits that the $25 billion in Recovery Act spending on infrastructure only created 150,000 jobs, it also stabilized and improved this nation’s productivity for years to come. Clean/green energy investments also come to mind, most of which require government funding and a government thrust in order to create millions of jobs. China knows this and is off and running. The U.S. needs to learn from their state-oriented model. In times of extremis, pushing on the private sector string is ineffective, especially within the context of a global marketplace that offers alternative investment locations. Government must temporarily assume a bigger, not a smaller, role in this economy, if only because other countries are dominating job creation with kick-start policies that eventually dominate global markets.

Deficits are important, but their immediate reduction can wait for a stronger economy and lower unemployment. Jobs are today’s and tomorrow’s immediate problem.
Those who advocate that job creation rests on corporate tax reform (lower taxes) or a return to deregulation of the private economy always fail to address dominant structural headwinds which cannot be dismissed: 1) Labor is much more attractively priced over there than here, and 2) U.S. employment based on asset price appreciation/finance as opposed to manufacturing can no longer be sustained.

Still, if we are to compete globally while maintaining a higher wage base, we must train for “middle” in addition to “high” tech. Philosophy, sociology and liberal arts agendas will no longer suffice. Skill-based education is a must, as is science and math.

Democrats Explicitly Call Out GOP For Sabotaging The Economic Recovery

It's obvious that the Republicans are trying to sabotage the economic recovery so they can recapture the White House in 2012. The Republicans don't even want to consider payroll taxcuts for employers. It's pro-business, it's a taxcut and the Republicans don't want it?!? It's obvious the Party of NO doesn't care about Americans or the U.S. economy, they only care about recapturing the White House so they can do some more serious damage selling off what's left of the middle class to the highest corporate bidders. More Here

This is what's bankrupting America


The following is taken from a great article by Ezra Klein:

Our government spends more on health care than the governments of Japan, Australia, Norway, the United Kingdom, Spain, Italy, Canada or Switzerland.

Think about that for a minute. Canada has a single-payer health-care system. The government is the only insurer of any note. The United Kingdom has a socialized system, in which the government is not only the sole insurer of note but also employs most of the doctors and nurses and runs most of the hospitals. And yet, measured as a share of the economy, our government health-care system is the largest of the bunch.

And it’s worse than that: Atop our giant government health-care sector, we have an even more giant private health-care sector. Altogether, we’re spending about 16 percent of the GDP on health care. No other country even tops 12 percent. Which means we’ve got the worst of both worlds: huge government and high costs.

This is where a “serious conversation” on health-care costs would start — with what has worked, and what we can learn from it. Instead, it’s where our conversation about health-care costs never quite goes.

The Republican plan, in fact, heads in the opposite direction: The GOP outsources Medicare to private insurers and gives senior citizens checks that cover less and less of the cost of insurance every year.

The Democratic plan, conversely, quietly recognizes that government-run health-care systems that are willing to throw their weight around can control costs. So the plan is to have Medicare try to pay for quality, not volume.

The Difference Between Democrats and Republicans

There's only one real problem in the U.S.. We need major political reform. There's been a corporate takeover of America. The health insurance industry sees that we pay double what other countries pay. Wall street writes the financial regulations and big oil writes our environmental protection regulations. The defense industry makes sure that we're the world's policeman.

Our representatives spend most of their time raising money and are now slaves to their corporate masters. The two party system is broken and it won't be easy to fix, because so many politicians have been corrupted by corporate money. The Republicans have jumped on the corporate bandwagon and have abandoned the middle class. Some of the Democrats have done the same thing, but many have not. Here's a synopsis of the differences between the two parties:

Democrats
  • Socially Progressive (pro-choice, support gay rights, etc.)
  • Support a safety net for the poor and elderly (Medicare, Medicaid, Social Security)
  • Support prudent regulations to keep the polluters, Wall Street, health insurers from taking advantage of people and the environment.
  • Actually care about governing, want a strong middle class and do a better job of managing the economy and the deficit.
  • Care about the quality of public education.
  • Want transparency in political donations and advertising.
Republicans
  • Socially Conservative (anti-choice, anti-gay, etc.)
  • Anti-government (want to eliminate the safety net for the poor and elderly)
  • Want to privatize Medicare (for the benefit of their corporate donors)
  • Want to privatize Social Security (for the benefit of their Wall Street donors)
  • Want to slash public education and privatize schools.
  • Don't want to cut defense spending (for the benefit of their military industry donors)
  • One solution for everything: deregulation and tax-cuts for corporations and the rich.
  • Claim to care about the deficit, but their tax cuts and wars and deregulation is what got us into this mess.
  • Don't really care about governing, because their anti-government.
  • Don't support transparency in political donations and advertising, so they can continue to rake in large corporate donations.
So, if you think stopping abortion is the most pressing issue in America today or if you make over $250,000 a year and don't care about the future of the country, you should vote Republican. Everyone else should vote for Democrats.

Tuesday, June 21, 2011

Declining Life Expectancy in the U.S.

Found in the LA Times: Women are living shorter lives than they used to, according to Dr. Christopher Murray, director of the Institute for Health Metrics and Evaluation at the University of Washington, which conducted the research.  The grim trend is fueled largely by smoking, high blood pressure and obesity, according to Murray and other population health experts. The number of Americans who are classified as obese hit 34% in 2010, more than double the rate in 1980. The widening gulf between the healthiest and least healthy populations is partly due to wealth. This fact is evident on the map:


In 737 U.S. counties out of more than 3,000, life expectancies for women declined between 1997 and 2007. For life expectancy to decline in a developed nation is rare. Setbacks on this scale have not been seen in the U.S. since the Spanish influenza epidemic of 1918, according to demographers.

I like one of the comments in a Mother Jones article: Here's the money quote from the research, "Equally concerning is that between 2000 and 2007, more than 85% of American counties have fallen further behind the international life expectancy frontier, of which 55% were statistically significant at the 90% confidence level. While the US and most of its communities fell further behind, the U.S. maintained its position as the country that spent the most per capita on health care throughout this period."

Unfriggin' believable. The only good news is that our schools are failing in a similar way, so soon we'll be too stupid to know we're such a mess.

Another good comment: I note the geographical distribution here tends strongly to the Red states where the safety net was never tightly woven during better times and has gotten worse over the past decade. America, this may be the Third-World future you think will "solve" our too-generous safety net.

Monday, June 20, 2011

The Truth About the Economy in 2 Minutes and 15 Seconds

Don't Fret the Debt

Don't Fret the Debt

Clarence Thomas is a Scumbag

I remember, in the not too distant past (like two years ago!), when I thought 'Well at least the court system isn't corrupt yet'). Reprinted from Credo:

A New York Times expose published Sunday details the improper ties between Supreme Court Justice Clarence Thomas and influential rightwing funder and activist Harlan Crow.


Crow is a major contributor to conservative causes and a stalwart supporter of Clarence Thomas. In past years he reportedly gave Thomas' wife, Ginni Thomas, $500,000 to exploit the Citizens United decision and start a shadowy, Tea Party-related group called Liberty Central. He gave Thomas a bible (estimated value $15,000) that once belonged to Frederick Douglass, and allegedly provided the Supreme Court Justice with access to his yacht and private jet.

As if that wasn't enough, the New York Times has revealed that Thomas may have improperly solicited a multi-million dollar donation from Crow to benefit one of his own pet projects near his birth place in a remote coastal community outside Savanna, Georgia.

Shockingly, the Supreme Court is not legally bound by the code of conduct for federal judges, though Justices Breyer and Anthony M. Kennedy have testified to Congress that members of the Supreme Court voluntarily follow the code which explicitly prohibits justices from directly soliciting charitable donations. If Thomas can't legally be removed from office because adherence to ethics rules for the Supreme Court are voluntary, then we must simply demand his resignation.

Crow is far from a disinterested philanthropist. He has donated nearly $5 million to Republican campaigns and rightwing groups, including a six digit donation to Swift Boat Veterans for Truth which so effectively attacked Sen. John Kerry during the 2004 presidential election. He's on the board of the ultra conservative American Enterprise Institute which brought a case to the Supreme Court challenging federal voting rights laws, a case that found only one sympathetic vote on the court — that of Clarence Thomas.

Sunday, June 19, 2011

How do we stop America's decline?

America is in trouble. It's on the decline. We can all feel it. Where did we go wrong? How do we fix it?

Our government is broken. Politicians play for political points and America loses. Our two party system is a joke. The gulf between the two parties is so wide most Americans feel completely unrepresented. This huge divide means there's absolutely no chance of reaching intelligent solutions to fix our problems.

I think of myself as an Independent, but I guess I've always been a Democrat. Facing the draft as a teenager during the Vietnam war made me pretty anti-Nixon. As a college graduate, I prefer smart leaders like Clinton and Obama and shy away from the more superficial Reagan and Bush II.

I consider myself fiscally conservative and socially progressive. The Republicans are neither. The Republicans have tried to hold the marketing position of "fiscal conservatives" and paint the Democrats as big spenders, but Clinton was the only recent president that trimmed the size of the federal government and produced a budget surplus.

I want this blog to be a place where I can collect references to relevent facts and ideas from around the web. I want to lay out a concise picture of where we are, how we got here and what to do to try to save America.