Millionaires, The Middle Class, and Taxes — Actual Numbers

Source: Paul Krugman

The Tax Policy Center has new numbers about the distribution of average tax rates by income class. Consider, in particular, the estimates of the combined income and payroll tax by income class; I’ve deleted a couple of columns to make the thing fit with more or less legible type:

Here’s how to read this: 40 percent of taxpayers with incomes between 30K and 40K pay more than 12.9 percent of their income in income and payroll taxes; meanwhile, 25 percent of people with incomes over $1M pay less than 12.6 percent of their income in these taxes. This suggests that there are a lot of very-high-income guys paying a lower tax rate than their secretaries.

And that doesn’t even take into account state and local taxes, which are quite regressive.

Taken as a whole, the US tax system is probably somewhat progressive — but not as much as you might think, especially at the upper end, and very erratically. There are a lot of rich people basically free-riding on the system.

Rich People’s Taxes Have Little to Do with Job Creation

By Michael Linden | June 27, 2011

Last week we pointed out that even though conservatives seem obsessed with the top income tax rate, overall economic growth was actually stronger during periods of higher tax rates. But maybe we missed the point. Maybe what conservatives are really concerned about is job growth, not overall economic growth. Maybe they have some convoluted argument about how the tax rate for rich people is incredibly important for creating jobs.

Cue the quotes:

Speaker John Boehner (R-OH): “What some are suggesting is that we take this money from people who would invest in our economy and create jobs and give it to the government. The fact is you can't tax the very people that we expect to invest in the economy and create jobs.”

Former Massachusetts Gov. Mitt Romney: “With over 20 million people who are unemployed or who have stopped looking for work, the last thing we should be doing is raising taxes on job-creators, entrepreneurs, and small business owners across America.”

John Boehner, again: “A tax hike would wreak havoc not only on our economy’s ability to create private-sector jobs, but also on our ability to tackle the national debt.”

Apparently, conservatives believe that a key driver of overall job growth is the tax rate that rich people pay on their last dollar of income. They argue that these very rich people are the ones who “create” the jobs and therefore taxing them at even slightly higher rates will make them less likely to invest, expand their businesses, and hire more people. That sounds plausible, but it turns out to be completely baseless.

In fact, they are just as wrong about this as they are about the relationship between marginal tax rates and overall economic growth. In the past 60 years, job growth has actually been greater in years when the top income tax rate was much higher than it is now.

For instance, in years when the top marginal rate was more than 90 percent, the average annual growth in total payroll employment was 2 percent. In years when the top marginal rate was 35 percent or less—which it is now—employment grew by an average of just 0.4 percent.

And there’s no cherry-picking here. Pick any threshold. When the marginal tax rate was 50 percent or above, annual employment growth averaged 2.3 percent, and when the rate was under 50, growth was half that.



In fact, if you ranked each year since 1950 by overall job growth, the top five years would all boast marginal tax rates at 70 percent or higher. The top 10 years would share marginal tax rates at 50 percent or higher. The two worst years, on the other hand, were 2008 and 2009, when the top marginal tax rate was 35 percent. In the 13 years that the top marginal tax rate has been at its current level or lower, only one year even cracks the top 20 in overall job creation.

We showed last week that lower rates are not associated with faster overall economic growth—just the opposite, in fact. And now we know that lower rates don’t coincide with higher job growth, either. So where is the evidence that the lower marginal tax rates spur job creation? It’s certainly not present in the past 60 years of American history.

It’s worth keeping this in mind the next time a conservative lawmaker claims that raising the rates for the wealthy would “destroy jobs.”

Michael Linden is the Director of Tax and Budget Policy at American Progress.

Hacking the recalls: Why we must have hand-counted paper ballots and citizen exit polls

By Grant Petty

It goes without saying that the outcomes of the nine Senate recall elections scheduled in Wisconsin will be of intense interest to most of the UW-Madison community.  Forecasting the outcome of elections weeks in advance is always a risky business; nevertheless, we offer the following bold prediction:

In at least some cases, the candidate receiving the lesser of the actual votes cast — perhaps, in fact, the candidate you passionately opposed — will be declared the official victor.

Chances are, you either think we are nuts or you are already upset with the dismal state of elections in Wisconsin, if not the country.  Either way, we hope this article will change your view of  both (a) the security of the elections and (b) the ability of ordinary citizens like you to improve that security.

Here’s a second prediction which gets to the heart of the real problem:

No one — not the Government Accountability Board, not the media, not any elected official, and most certainly not you – has the slightest hope of ever  disproving our first prediction in light of current election procedures and practices.

While our first prediction is open to debate, the second is rock solid. Why? Because our appallingly compromised election procedures in this state are simply incapable of detecting or preventing election fraud, due to a combination of wholly inadequate statutory safeguards and criminally negligent enforcement.

(Note by the way, that we are not talking about voter fraud, which was ostensibly the reason behind the recently enacted voter ID law.  Both the prevalence and practical significance of voter fraud is a discredited myth.  If you want your candidate to win an election dishonestly, it is far easier and more effective to rig the counting of the ballots on the electronic voting machines. We find it interesting and significant that those in the Wisconsin Legislature who rammed through the voter ID law have so little to say about the far greater threat of election fraud.)

Election fraud is not just a hypothetical concern.  In addition to strong circumstantial evidence in countless other cases, instances of clear fraud have been uncovered that led to actual indictments in Cuyahoga County, Ohio, and Clay County, Kentucky.   Echoes of Cuyahoga can be heard (by those inclined to hear them) in the recent Waukesha recount.

Experts on election integrity have been sounding two main alarms for at least ten years:  (1) it’s far too easy to rig elections in ways that are difficult to detect, and (2) there is considerable circumstantial evidence that it is regularly occurring.

Consider this:  Approximately 1.48 million votes were cast in the Prosser v. Kloppenburg election. The final published difference between them was a mere 7,004 votes, so flipping only 3,502 of them could have given the election back to Kloppenburg.  That’s only a single vote flipped (or, alternatively, two Prosser votes simply discarded) per 422 cast!

Now consider this:  Electronic voting machines use proprietary software to tabulate votes.  Not even election officials are allowed to view or test the integrity of the software or the memory cards. The counting of votes simply cannot be observed or verified by the voting public or the election officials.  It is impossible to know whether it is being done correctly and honestly. We are being told to take it on faith that the voting machine vendors, and those who have access to the machines, are honest.  This is not merely risky, it is fundamentally antithetical to democracy.

The Emmy-nominated documentary Hacking Democracy (free viewing online, 81 min.) presents a shocking demonstration of how easily electronic votes can be hacked, and it also offers troubling evidence that election rigging is actually occurring.  Even if you don’t read beyond this point, please view Hacking Democracy and urge family, friends, and acquaintances to watch it as well.

You will never view our elections or electronic voting machines the same way again.

We’re accustomed to hearing the phrase “innocent until proven guilty” applied to suspects being tried for crimes, and that’s as it should be.  But we in the United States, more so than in many other developed countries, inappropriately apply the same standard of evidence to our elections. Our naive assumption is that unless unambiguous evidence of fraud or gross error is actually uncovered, it most likely didn’t occur.  If you can’t see it, it must not exist.  This is what those who corrupt the election process count on.

Election fraud, like any crime, requires both motive and opportunity. And ample motive can already be found on either side of the current ideological divide in our country.

Imagine the zealous conservative who sincerely believes that abortion is murder and that liberal politicians are therefore condoning murder on a large scale.  Or imagine the zealous liberal who sincerely believes that conservative policies will condemn the earth to perish, and soon, from runaway greenhouse warming.  Either of these individuals might be persuaded that it’s morally justified and urgently necessary to commit election fraud in defense of humankind.

Would anyone who cares about honest elections deliberately put either person in charge of actually overseeing and enforcing election procedures? But that’s exactly what we do with our partisan elections for county clerks!

As we saw in the last recount, many judgment calls were made as to which ballots would be declared valid and which discarded.  And whenever judgment is in play, so is bias.  If you are unfortunate enough to live in a county or municipality where your election officials oppose the party or candidate you support, you should be very, very concerned about whether your vote will be fairly counted.

But it doesn’t stop at the county level. Consider further the wealthy industrialist who quite plausibly believes that if a certain pro-regulation candidate for Congress loses, s/he and their allies stand to make millions of dollars more per year.  Might s/he not be tempted to invest considerable political and financial capital in getting voting machines adopted that can be easily and undetectably hacked?  Would they perhaps even get into the business of building them?

We may never be able to eliminate the motive, but we can, and we must, identify and eliminate the opportunities to undetectably rig our elections. Until we do, we cannot rationally assume that elections are clean and fair.  And we therefore cannot rationally trust the official outcomes of elections.

Here, in summary, are the major weak links in Wisconsin elections:

Vote tabulation. Can we be certain votes are being honestly and correctly tabulated by electronic devices?  No. Unfortunately, current procedures and the electronic voting machines themselves provide absolutely no way to independently verify the accuracy of electronic vote counts short of a full hand recount of paper ballots.  And by Wisconsin law, most of the recount must be done on the same electronic voting machines that could have been hacked in the first place. Be aware that the memory and printouts can be made to differ from the real voter intent and that the pre-election testing is useless for detecting fraudulent programming!

Also, although required by Wisconsin law, touch-screen machines used in some districts were found to provide no paper record and thus no voter-verifiable (or recountable) record of the vote!

Chain of custody. For the purposes of a recount, are we ensuring that ballots can’t be added or subtracted between the time they are cast by the voter and the time they are recounted?  As we clearly saw in the recent Wisconsin Supreme Court recount, the mandated procedures for our elections are not always followed. Citizen observers witnessed a stunning range of abnormalities in the labeling/sealing of ballot bags and even discovered a poll tape dated March 30, days before the election.  The poll tape in question, with its time stamp of 1:40 AM, was sworn to as actual votes.  This claim was later retracted only when persistently questioned.

We have  sampled just some of the evidence suggesting that the upcoming recall elections in Wisconsin cannot, and should not, simply be trusted to be honest.  Now we come to the most important part:  What can still be done to restore confidence in the outcomes?

There are in fact a number of effective steps that can still be taken.  All of them require citizen engagement.

1. Wisconsin Citizens for Election Protection are urging hand-counts for the recalls. They have sent letters to all the clerks asking that they hand-count the recalls. You can contact them at protectwi@gmail.com.
2. Contact your county and municipal clerks, the election inspectors and the mayor and councilpersons or the town chair and the supervisors. They can authorize the little extra money that it would take to hand-count paper ballots (HCPB) for the recalls in your municipality.   Talk to them about the many jurisdictions in Wisconsin and elsewhere  that already count their ballots by hand.  Acton, Maine (with seven races and two initiatives,  six teams of two people each — a Republican and a Democrat — were able to hand-count, twice, 944 ballots in four hours) and Lyndeborough, New Hampshire are potential models for the rest of the country.
3. Volunteer to serve in non-partisan citizen exit polls being organized by the Election Defense Alliance to rigorously and independently verify vote tabulations and chain-of-custody of ballots.

Our final prediction:  Unless the Wisconsin recalls are hand-counted in every race, with secure hand-counted paper ballots (HCPB) elections, at least some of them will be rigged, with major implications for the balance of power in the Statehouse.

Alarmist?  Perhaps.  But the only way to be certain is to act immediately to close the massive security holes in our elections.  Please use social media to share the information and links in this article,  and help educate those who naively think that outcome of the recall elections depends solely on getting out the vote, who votes and how they vote.

Protecting election integrity is not ‘left’ or ‘right.’  If any commentator or political leader actively objects to making our elections more secure,  please ask yourself what their real stake is in the current deeply flawed system.

“I consider it completely unimportant who in the party will vote, or how; but what is extraordinarily important is this — who will count the votes, and how.” – Josef Stalin

__
Grant W. Petty
Professor of Atmospheric Science
University of Wisconsin-Madison.

Sheila Parks
Founder, Center for Hand-Counted Paper Ballots
This article may be reproduced in whole or part with attribution of authorship and a link to this article. Copyright July 2011, Grant Petty and Sheila Parks.

Republicans constantly lie about taxes and small businesses

Source: Center on Budget and Policy Priorities

I just heard yet another republican spouting lies about how we can't raise taxes on the wealthy, because it'll just kill small business job creation. The best data on this comes from the non-partisan group -- Center on Budget and Policy Priorities (CBPP). The above link is to an excellent eight page report on this issue. Here are the key findings:

• Supporters of various tax benefits for highincome
households often claim that failure to
maintain them would have an undue effect on
many small businesses. But even assuming a
broad definition of “small business,” these
claims are very often exaggerated or false.

• Only 1.9 percent of taxpayers with smallbusiness
income face either of the top two
income tax rates -- the top rate (from 39.6
percent to 35 percent) and the next to-
top rate (from 36 percent to 33
percent). Thus, allowing the 2001
reductions in these rates to expire as
scheduled in 2010 would not affect most
small-business owners. Strengthening the
Earned Income Tax Credit could help more
than seven times as many small businesses
as extending the reductions in the top rates.

• Claims that the estate tax must be largely or
entirely eliminated to protect small businesses
are misleading as well. According to the Tax
Policy Center, in 2009 only 0.003 percent of
all estates — that is, the estates of three out of
every 100,000 people who die this year — will
be small business estates that owe any estate
tax.

• The typical small business is not a wealthy
hedge fund. Closing a lucrative tax loophole
used by hedge fund managers would have no
effect on “mom and pop” businesses.

Washington politicians must think we’re stupid

(Excerpts from Public Campaign)

They take money from powerful corporate interests like Big Oil and Wall Street. They introduce, debate and pass legislation that boosts the bottom lines of these companies. And they expect us to believe that the campaign cash has nothing to do with how they vote.

Seriously.

Out in the real world, no one believes that Exxon and Bank of America give millions of dollars to members of Congress out of sheer corporate kindness. Giant corporations spend money on politics because they get something in return.

And we’re not talking about small amounts of money here, either.

Earlier this year, the Senate voted on whether to extend billions of dollars in taxpayer subsidies to Big Oil. The 48 senators who supported subsidies each got an average of over $370,000 in campaign contributions from the industry. The 52 senators who opposed subsides each got only about $72,000. (Source)

Coincidence?

I don’t think so. It’s just business as usual in our nation’s capital—another corporate handout by politicians in exchange for campaign contributions.

This institutionalized corruption is degrading our democracy, and the American people are losing faith in our government. They understand that real change requires limiting corporate money, and they overwhelmingly support public funding of federal elections and overturning the Supreme Court’s disastrous Citizens United v. FEC ruling.

Unfortunately, 48 U.S. senators selling their votes to Big Oil is only one example of the massive corruption that characterizes politics in Washington today.

And the oil and gas industry is not even the biggest spender in Congress.

In the 2010 elections, financial services companies contributed $305 million to federal candidates and political parties and spent another $471 million on lobbying.

That’s right—three quarters of a billion dollars was spent by Wall Street, insurance and real estate companies to make sure members of Congress did what these special interests wanted. And they got what they paid for.

Senators who supported Wall Street’s position on the two most important financial service bills of the last two sessions of Congress—the 2008 Troubled Asset Relief Program (TARP) and the 2010 financial reform bill—got an average of $879,803 from this special-interest group. Senators who opposed Wall Street got $63,569 each—a difference of nearly 14 to 1.

But corporate America’s influence-peddling didn’t stop with the passage of this legislation. The Big Banks are working day and night to block or undermine regulations that implement the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Public Citizen has launched a project to analyze and expose lobbying activities of Wall Street and other business interests determined to slow down the implementation of Wall Street reform and other legislation.

Their first report—“Wall Street’s Two Cents”—examined the reform bill’s requirement for publicly traded companies to reveal how much their CEOs make compared to the salary of their average employee.

Corporations are fighting this simple disclosure requirement tooth and nail, for all the obvious reasons. In our report, we analyzed four business groups with extensive lobbying operations and found they spent more than $4.5 million lobbying on financial regulation and other issues. They deployed 46 individuals—37 of whom are former government employees—to lobby on financial regulation, and made $660,180 in political contributions.

Corporate money doesn’t just influence what gets passed in Congress, or how regulators implement the laws Congress passes. Maybe the most far-reaching impact of all the corporate money sloshing around the Capitol is how it shapes what even gets discussed in the first place.

Darrell Issa (R-Calif.), chairman of the powerful House Committee on Oversight and Government Reform, solicited input from 150 trade associations on which regulations that protect the health and safety of the American people they’d like to see eliminated. Over his House career, Issa has received $17.4 million in campaign contributions—nearly $1.5 million from communications, electronics, finance, insurance, real estate and health services businesses.

The Poor get Poorer

Another 2.6 million people slipped into poverty in the United States last year, the Census Bureau reported Tuesday, and the number of Americans living below the official poverty line, 46.2 million people, was the highest number in the 52 years the bureau has been publishing figures on it.

And in new signs of distress among the middle class, median household incomes fell last year to levels last seen in 1997.

Economists pointed to a telling statistic: It was the first time since the Great Depression that median household income, adjusted for inflation, had not risen over such a long period, said Lawrence Katz, an economics professor at Harvard.

The report said the percentage of Americans living below the poverty line last year, 15.1 percent, was the highest level since 1993. (The poverty line in 2010 for a family of four was $22,314.)

The past decade was also marked by a growing gap between the very top and very bottom of the income ladder. Median household income for the bottom tenth of the income spectrum fell by 12 percent from a peak in 1999, while the top 90th percentile dropped by just 1.5 percent. Overall, median household income adjusted for inflation declined by 2.3 percent in 2010 from the previous year, to $49,445. That was 7 percent less than the peak of $53,252 in 1999. Part of the income decline over time is because of the smaller size of the American family.

Minorities were hit hardest. Blacks experienced the highest poverty rate, at 27 percent, up from 25 percent in 2009, and Hispanics rose to 26 percent from 25 percent. For whites, 9.9 percent lived in poverty, up from 9.4 percent in 2009. Asians were unchanged at 12.1 percent.

An analysis by the Brookings Institution estimated that at the current rate, the recession will have added nearly 10 million people to the ranks of the poor by the middle of the decade.

Last year, about 48 million people ages 18 to 64 did not work even one week out of the year, up from 45 million in 2009, said Trudi Renwick, a Census official.

According to the Census figures, the median annual income for a male full-time, year-round worker in 2010 — $47,715 — was virtually unchanged, in 2010 dollars, from its level in 1973, when it was $49,065, said Sheldon Danziger, professor of public policy at the University of Michigan.

The poverty level for a single person under the age of 65 was $11,344.

The report also said the number of Americans without health insurance increased by 900,000 to 49.9 million.

Source: Truthout

Below are charts using the same census data copied from OffTheChartsBlog:

The Census Bureau issued data this morning on poverty, incomes, and health coverage in 2010. Below are some charts to show how the new figures look in historical context, and here’s our statement with analysis.

 

Failing to educate our kids

American is falling behind the rest of the world in intellectual infrastructure – we now rank 14th, 17th, and 25th, respectively, in reading, science, and math when compared to the 34 most developed nations on the world – many of which send their kids to college for free. No nation can be successful and compete in a global economy – with poorly education young people. Also, according to a new report from the OECD – the United States is the ONLY G-20 nation whose new workers have less education than its retiring workers.

Source: Thom Hartmann

Actually we are at neither.  We have been at an RV park on a Naval Sub Base near St Marys, GA since the 1st of Sept..  The base is at the extreme SE corner of GA, right across the river from Amelia Island, FL.  We'll be here until next Tuesday, then on to Jekyll Island (about 40 miles north).  After that we may go up to Beaufort, SC for a few days, then down to St Augustine. We plan to be gone until the beginning of November.

What's your summer like ? (I guess I should use the past tense for WI)  

When are you planning on coming back to the Keys?

Gil
gmar1025@aol.com

The Great Recession in five charts

Source: WonkBlog, Suzy Khimm

How brutal has the recession been to U.S. households? Americans are earning even less than they did 13 years ago. That’s according to new Census data released Tuesday, which found that real median income fell to $49,445 in 2010, the lowest number since 1997, and the largest decline in income in a single year of any recession since at least 1967. Poverty rates also rose to a record level: 15.1 percent of Americans are now in poverty, the highest level since 1993. Here are the five most important charts from the Census showing how all of this breaks down.

The first one is probably the most sobering chart of all. Real median income had a record drop between 2009 and 2010, marking an even more rapid decline than in previous recessions. Income had been edging downward since the end of the Clinton administration, but the recent recession essentially wiped out more than a decade’s worth of gains.

SOURCE: U.S. CENSUS
 
That being said, not all households have experienced a decline in income over the past year.

(SOURCE: U.S . CENSUS)

The average incomes of all income brackets have all sunk over the course of the recession, but the downturn dealt more of a blow to the middle-class and the poor. In 2010, the top 10 percent of wage-earners made as much as they did in 2002. By contrast, the 50th percentile hasn’t earned this little since 1996, and the bottom 10 percent since 1994. The last decade has set everyone back, but the richest Americans have been better protected than others. That being said, don’t blame the recession for the inequality gap itself: that trend started, during the mid- to late-1990s.

Now let’s take a closer look at which groups of Americans have been most adversely affected by the recent downturn.

(SOURCE: U.S. CENSUS)
 
Americans under 35 have seen their income decline from 2009 to 2010, while older workers have largely been shielded during that time — that is, except for middle-age Americans 45 to 54. That’s likely to represent older workers who aren’t able to retire yet, but who’ve had more difficulty than other groups in finding new jobs if they’ve been laid off.

Accordingly, there are also big disparities in poverty according to age: the poverty rate for children under 18 has risen sharply—and is higher than any other age group—while older Americans are even less likely to be in poverty than they were during the start of the recession.

(SOURCE: U.S. CENSUS)

Poverty for Americans age 18 to 64 is at a record high: at 13.7 percent. It’s highest poverty rate for this age group that the Census has on record since 1959. (The next highest rates for this group happened in 2009, then 1983.) By contrast, the poverty rate for seniors is at a record low: in 2009, it was at 8.9 percent, and it’s remained essentially flat since then. Why? It seems that Social Security has provided a safety net that’s weathered the recession: without this income, the poverty rate for Americans over 65 would have risen by 13.8 million, the Census says.

And as bad as things look for other age groups, the safety net has also prevented even more younger Americans from falling into poverty: without unemployment insurance benefits, the poverty rate for other adults would have risen by 2.3 million and children by 900,000.

Finally, the breakdown of poverty by race and ethnicity also showed stark disparities, with a particularly sharp uptick in poverty among Hispanics:

(SOURCE: U.S. CENSUS)

The recession isn’t singularly responsible for these disparities, but in many crippling ways, it’s helped to widen the gap.

America’s surprisingly tiny small-business sector

The one thing every American politician can agree on is that small businesses are a crucial driver of the U.S. economy. So it’s somewhat surprising to discover that, as John Schmitt of the Center on Economic and Policy Research points out, the United States actually has the smallest small-business sector among wealthy countries. Here’s a chart, using data from OECD’s Entrepreneurship at a Glance 2011 , showing that the United States has the lowest share of employees in enterprises with 50 or fewer employees:



And, conversely, the United States has the largest share of workers in big enterprises — defined as companies with 250 or more workers:



But in an earlier paper with Nathan Lane, Schmitt argued argued that the most likely explanation for the difference between the United States and the rest of the world was health care: “The high cost to self-employed workers and small businesses of the private, employer-based health care system in place in the United States may act as a significant deterrent to small start-up companies, an experience not shared by entrepreneurs in countries with universal access to health care.”

Source: WonkBlog, Brad Plumer

The magical world of voodoo ‘economists’

Excerpts from Steven Pearlstein:
 
The GOP wants to repeal the 20th century, "Repeal the 20th century. Vote GOP. It’s not just the 21st century they want to turn the clock back on -- health-care reform, global warming and the financial regulations passed in the wake of the recent financial crises and accounting scandals. These folks are actually talking about repealing the Clean Air Act, the Clean Water Act and the Environmental Protection Agency, created in 1970s. They’re talking about abolishing Medicare and Medicaid, which passed in the 1960s, and Social Security, created in the 1930s. They reject as thoroughly discredited all of Keynesian economics, including the efficacy of fiscal stimulus, preferring the budget-balancing economic policies that turned the 1929 stock market crash into the Great Depression. They...give the strong impression they wouldn’t mind abolishing the Federal Reserve and putting the country back on the gold standard."

The German plan to reduce U.S. unemployment

(SOURCE: EUROSTAT)

Germany has kept its employment levels astoundingly high throughout the global recession. How high? In July, the country’s unemployment rate was just 6.1 percent, a full two points lower than it was in January 2008. Many credit labor reforms that allow employers to use government subsidies to keep more workers on the job, temporarily reducing hours while using public funds to make up some of the difference. Known as “short-time work” or “work-sharing,” the scheme aims to spread the pain of recession around rather than forcing a handful to bear the brunt of the suffering.

By many accounts, work-sharing appears to have been successful, and a growing number of countries — primarily in Europe, as well as Japan — have actively embraced it. “European countries with widespread and generous short-time compensation experienced a smaller rise in unemployment in the recent recession than those without,” write economists Pierre Cahuc and Stephane Carcillo for VoxEU. They explain that a one-percentage-point increase in short-time work correlates with a one-point decrease in unemployment.

Even as German firms began to suffer from a severe decline in production, many of them “chose to keep rather than shed workers,” keeping the employment rate high and the “German miracle” alive, explain George Washington University’s Alexander Reisenbichler and Kimberly J. Morgan.

President Obama now seems eager to follow Germany’s lead. The American Jobs Act contains a provision that would encourage employers to utilize work-sharing instead of layoffs, allowing workers whose hours have been reduced to receive unemployment benefits. Liberal economists such as Dean Baker have also been vocal in urging expansion of the program — which more than 20 states have already adopted in some form — calling it the “quick route back to full employment.”



Others have warned, however, that work-sharing is not a fail-proof panacea, arguing that the policy could dampen productivity and efficient labor-force reallocation. The scheme has a positive effect on full-time employment but doesn’t help temporary employment, which could make it harder for those who are unemployed to reenter the workplace, Cahuc and Carcillo argue: “The benefits of insiders can be at the expense of the outsiders whose entry into employment is made even more difficult.” And there’s some data that could back up this claim. Though its overall employment rate is low, Germany’s long-term unemployed make up a higher percentage of total unemployment than in many comparable nations, including the United States.

What’s more, work-sharing probably would have had the most impact in the United States had it been implemented before companies made huge layoffs, not afterward. The program could deter firms from making future layoffs, but that doesn’t mean they would be motivated to hire additional workers. But given the country’s dismal economic outlook, those who have held on to their jobs may be grateful for extra protection where they can get it.

Source: WonkBlog, Sarah Kliff

The White House’s populist pay-fors

At a press briefing earlier this afternoon, White House budget director Jack Lew revealed the Obama administration’s proposed offsets for its jobs bill. Here’s what they have in common: they’re all tax increases on the wealthy, they’ve all been proposed by the Obama administration in the past, and none of them are likely to attract Republican support.

The bulk of the money would come from capping the tax break the wealthy can get from itemized deductions and making it harder for hedge-fund managers to report their income as capital gains and thus pay a lower tax rate on it. Those two changes alone would bring in more than $400 billion over 10 years. The White House also proposed doing away with deductions that favor corporate jets and oil and gas companies, though those changes wouldn’t bring in as much money.

These aren’t new policy ideas. The Obama administration has been looking to cap itemized deductions since the 2009 budget. Nor are they bipartisan policy ideas: a Republican who voted for any of them would be breaking Grover Norquist’s pledge.

The GOP might be working to showcase a more conciliatory tone in public, but that new tone does not mean they’re willing to talk taxes. Michael Steel, spokesman for Speaker John Boehner, e-mailed a quick, and negative, reaction to the White House’s announcement: “This tax increase on job creators is the kind of proposal both parties have opposed in the past. We remain eager to work together on ways to support job growth, but this proposal doesn’t appear to have been offered in that bipartisan spirit.”

But perhaps the point of the proposals isn’t to attract GOP support that, in all likelihood, will never come. Perhaps the point is to force the GOP to make a difficult choice: either come back with offsets the White House can accept in place of these policies, or try to explain why keeping taxes low on the rich is more important than helping the jobless.

All in all, these pay-fors make me less optimistic that much of the jobs package will pass, though my guess is they will make a lot of liberals more optimistic that the White House is finally willing to wage a public campaign on behalf of its policy ideas.

Source: Ezra Klein

Health care consolidation: the good, the bad and the ugly

When the House Ways and Means Health Subcommittee held a hearing Friday morning, there was a weird moment of bipartisan agreement on health policy: increasing consolidation in the health industry is bad for patients.

The three-hour hearing probed the health industry consolidation that has increased for the past two decades or so. As a way to increase market clout, hospitals have been buying up physician practices, insurance plans have been merging and health systems are growing larger. Both the Health Subcommittee’s chair, Republican Rep. Wally Herger, and ranking member, Democratic Rep. Pete Stark, repeatedly warned of the negative impact of health consolidation, with larger market clout leading to increased prices and less choice for patients.

“It is refreshing to see our majority raise concerns about competition in the marketplace and how it may result in outcomes that are bad for consumers and for Medicare,” Stark said at the hearing.
 

But one potential silver lining of health consolidation went unnoticed: more mergers, particularly in the insurance industry, may drive down coverage costs.

A study published this week in Health Affairs confirmed one of the legislators’ fears: hospital concentration did indeed drive up price of care. But it also found a brighter side to consolidation. Increased concentration of health plans has the opposite effect: it lowered hospital prices by 12 percent, compared to those with more competitive insurance markets. Insurance plans with more subscribers likely give carriers more bargaining clout to bring down the price of care.

“Our results show that more concentrated health plan markets can counteract the price-increasing effects of concentrated hospital markets,” the study concludes.

What it doesn’t conclude: that those lower hospital prices trickle down to insurance subscribers. It would have been interesting for this study to include data on what insurance premiums look like in these markets but, unfortunately, it doesn’t. Still though, it’s an interesting look at how the different market dynamics can effect how much we spend on health care.

Source: Washington Post, Sarah Kliff

Buddy Roemer blowing the lid off Washington Corruption

Source: YouTube

Paul Krugman on the global economy, Europe's debt crisis and Obama's jobs plan

Source: Bloomberg

SEC Should Require Corporate Political Spending Disclosures

Source: Huffington Post

WASHINGTON -- Corporations should not fear disclosing their political spending, says a report co-authored by a Harvard Law School professor and the watchdog group Public Citizen. The report, which calls on the Securities and Exchange Commission (SEC) to require corporations to disclose their political expenditures, found that S&P 500 companies that voluntarily disclose their political spending have a higher shareholder value than those that do not disclose.

The report comes as the the U.S. enters its first presidential election cycle since the Supreme Court ruled in Citizens United vs. Federal Election Commission (FEC) that corporations and unions could spend money on electoral activities, allowing a massive infusion of often undisclosed money into elections.

Justice Anthony Kennedy, author of the majority opinion in Citizens United, firmly backed the disclosure of all political election spending. But an increase is undisclosed election spending appears to be the biggest effect of the Supreme Court ruling.

Outside groups, empowered by the Citizens United decision, spent $266.4 million in the 2010 midterm elections, with $135.6 million coming from groups that were not required to disclose the source of their funding, according to the report.

"The corporate spending that was permitted by Citizens United ought to be disclosed," said report co-author Tyler Lincoln, who is Public Citizen's research director.

The report calls on the SEC, which regulates publicly-held companies, to require those companies to disclose their political spending to their shareholders and the public. SEC disclosure would partially fill the gaps in campaign finance disclosure left by the Citizens United ruling.

In 2010, Congress failed to pass the DISCLOSE Act, which would have required disclosure of all the new spending allowed under Citizens United. The Senate fell one vote short of cloture on the bill. The Obama administration has been considering an executive order requiring all government contractors to publicly disclose their political spending when they apply for contracts. This order has been vehemently opposed by the U.S. Chamber of Commerce, the highest-spending outside group in 2010, and other business groups, delaying its release.

The push for the SEC to require disclosure of companies' political spending is the most recent attempt to reverse the trend towards non-disclosure by those concerned about "dark money" in elections. SEC action has been sought by a group of law professors who have petitioned the commission to enact political spending disclosure rules.

Yet much of the money flowing to outside groups is believed to be coming from privately-held companies, such as Koch Industries, rather than publicly-held companies that would be affected by any SEC disclosure rules. Still, big spenders like the Chamber of Commerce do get huge sums from some of the largest publicly-traded companies.

"You've got your front groups, like the Chamber of Commerce, who gets a lot of checks of $100,000 or $1 million, and a lot of these contributions come from public companies," Public Citizen's Lincoln said.

Some examples of disclosed political contributions to the Chamber in 2010 include a $1.9 million contribution from Dow Chemical, a $141,000 contribution from Microsoft, a $50,000 contribution from Norfolk Southern, and a $35,000 contribution from Alcoa.

The report's look at the value of S&P 500 companies was conducted by Harvard Law School Professor John Coates. He found that companies that disclosed their political activity had the highest shareholder value.

"When you control for all the things that effect market valuation, the companies that disclose their political spending have a higher market valuation," Coates explained.

The study covered 80 S&P 500 companies that publicly disclose their political spending and found "companies with policies calling for political disclosure had a 7.5 percent higher industry-adjusted price/book ratio than other firms as of year-end 2010."

"Our findings are consistent with the idea that [political spending disclosure] would be good for the firms," Coates said. "It would raise their valuations. It would make it easier for them to raise capital. It would make it easier for them to grow."

Global dimming helps coal remain competitive with natural gas

Source: Washington Post

The great hope among energy wonks is that natural gas is the short-term salve for our climate woes. After all, burning natural gas for electricity emits just half the carbon dioxide that burning coal does. Plus, the United States seems to have an abundance of gas, particularly in the Marcellus Shale, and low natural-gas prices are already prodding many electric utilities to retire their coal plants. That’s why liberal groups like the Center for American Progress have dubbed natural gas a “bridge fuel,” to tide us over until better low-carbon technologies arrive.

But natural gas has come in for some sharp scrutiny of late. First, there was a study by Cornell ecologist Robert Howarth suggesting that natural gas was actually worse for the climate than coal when you take into account the methane leaks from shale-gas development. While that study has been rebutted by other analyses — see, for instance, this new paper in Environment Research Letters — it did rightly call attention to the methane problem. Meanwhile, questions have been raised about how much recoverable gas the Marcellus actually contains, while concerns about the process to extract the gas, hydraulic fracturing, abound.

And now comes along a new study by Tom Wigley of the National Center on Atmospheric Research, raising further questions about natural gas’s climate impact. Wigley’s study, which will be published in Climactic Change Letters next month, finds that a worldwide partial shift from coal to natural gas could actually speed up global warming between now and 2050 (more on why in a sec). After that, global warming would slow slightly, although it would depend on how well the industry could limit methane leaks.

Even in the most optimistic case, natural gas isn’t a panacea — Wigley’s computer simulations suggest that a partial shift to natural gas would, at best, lower the increase in global temperatures about 0.1 degree Celsius in 2100. Here’s a chart showing the difference a natural-gas switch would make — notice that in all scenarios the temperature first increases (versus the coal scenario) and only later declines:


But if natural gas is, in fact, cleaner than coal, why would it accelerate climate change in the near-term? The key fact here is that burning coal emits two different types of pollutants. First, there’s carbon dioxide, which traps heat. But dirty coal plants also emit aerosol pollution — sulfates and other particles that stay in the air for a shorter amount of time and cool the planet by reflecting incoming sunlight back into space. These particles are bad for human health and cause problems like acid rain, but they do have a short-term cooling effect. (Since aerosols linger in the atmosphere for a shorter period than carbon dioxide, the warming effect eventually prevails.)

Since natural gas is cleaner and emits fewer sulfates, you’d actually get more warming in the short term. Now, since natural gas emits less carbon dioxide, you would get relatively less warming over a longer timeframe, although even then the net climate impact is fairly small. Ultimately, that’s not an argument against natural gas — after all, a slight improvement is still an improvement. Plus, reducing that sulfate pollution would lead to large public-health benefits. But the climate upside, at least, may not be as sweeping as advertised.

Good Warren Buffett Quote

"There's class warfare, all right, but it's my class, the rich class, that's making war, and we're winning."

• New York Times, November 26, 2006.

My letter to the Republicans

We have 14 million people in this country that need jobs. We need to fix our crumbling infrastructure. We need to borrow some more money at 0% and get this economy moving, so that we have growth in our tax revenue. We need the rich to contribute to our sacrifice. The middle class is being obliterated. According to a new Pew report, 1 in 3 Americans who grew up and were raised in the middle class have since fallen out of that economic class today – and now belong to the working poor. This'll be the United Banana Republic soon.

I'm convinced you want the economy to collapse, just to win the next election. Prove me wrong and support the American Jobs Act.

The boring truth about Social Security

Source: Ezra Klein

There was a long and mostly confused conversation about Social Security during Wednesday night’s GOP debate. But rather than get sidetracked over whether the pension program is a “monstrous lie” (Perry), “a Ponzi scheme” (Perry again), “tyranny” (yep, Perry), “broken” (Cain), or a great system that Americans are being “defrauded out of” (Romney), let’s just go to the numbers.


Over the next 75 years, Social Security’s shortfall is equal to about 0.7 percent of GDP (pdf). If we increase its revenues by that amount -- which could be accomplished by lifting the cap on payroll taxes -- or reduce its benefits by that amount or do some combination of the two, Social Security is back in the black. Here are 30 policy tweaks that could get us there. 


Why does Social Security show a shortfall? As Stephen C. Goss, the system’s chief actuary, has written, Social Security projects an imbalance “because birth rates dropped from three to two children per woman.” That means there are relatively fewer young people paying for the old people. “Importantly,” Goss continues, “this shortfall is basically stable after 2035.” In other words, we only have to fix Social Security once. After we reform it to take account of modern demographics, the system is set for the foreseeable future.


And that’s...it. That’s what’s needed to fix Social Security. All this talk about it being a “monstrous lie” or “a Ponzi scheme” or “broken” is meant to create a crisis to clear the way for radical changes in Social Security. But if folks want to make radical changes to Social Security, they should just make the argument for their proposed fixes. And good luck to them. But in reality, what’s going to happen is that sometime in the next decade or so, Republicans and Democrats are going to compromise on a package that adjusts Social Security by about 0.7 percent of GDP over the next 75 years.

The number of job openings is rising. So why aren’t there more jobs being created?

Source: Washington Post, Suzy Khimm

Contrary to the standard line in Washington, there are some jobs out there--and the number is growing. There were more job openings in July than any time over the last two years. But employers aren’t hiring as quickly as you might expect, which may be part of the reason that job creation has lagged and unemployment rate remains stubbornly high

New figures this week from Bureau of Labor Statistics confirm the uptick in job openings over the last two years. The number didn’t increase much over the summer, but it has grown sharply since July 2009, after it hit bottom.

(SOURCE: BUREAU OF LABOR STATISTICS)

Employers, however, haven’t been hiring as rapidly. The number of new hires has risen since July 2009, when they were also at a nadir. But the number of new hires has remained flat over the past year.


(SOURCE: BUREAU OF LABOR STATISTICS)

What’s responsible for this gap? Part of the reason may be that employers are having trouble finding enough skilled workers to fill the jobs in certain industry, as I reported earlier. That’s been the ongoing complaint from the manufacturing industry, which saw some of the biggest increases in job openings this summer. This skills gap has prompted both President Obama and Mitt Romney, among others, to make jobs training an integral piece of their agenda.

But even if employers increase their rate of hiring, unemployment world remain high if those employers are luring already-employed workers away from other jobs. The longer someone is unemployed, the harder it is for them to find work. And even if all the available openings were filled, the number of unemployed people is so high, that would only be the first step to solving the jobs crisis, as the Economic Policy Institute reminds us.

Texas Burns, U.S. less competitive, Poor get poorer, Tax the rich

Excerpts from Thom Hartmann News:

Budget cuts have consequences – and tens of thousands of Texans are learning that lesson the hard way.  This year – Governor Rick Perry cut his state’s volunteer firefighter program by 75% - reducing funding from $30 million down to $7 million for the critical program to prevent wildfires.  Now – massive wildfires are engulfing his state – and have destroyed more than 1,000 homes and killed four people. It’s the largest wildfire outbreak in the history of Texas.  I think Governor Perry has some explaining to do in tonight’s Republican debate – namely – how he can tout his accomplishments as Governor when he’s literally left his state in flames.

Instead of chanting, “we’re #1,” in America – it may be time to start chanting, “Hey, we’re in the top 5!”  The World Economic Forum just released its latest rankings of the world’s most competitive economies – and the United States has slipped to number five.  In terms of competitiveness – our economy now ranks below Switzerland – Singapore – Sweden – and Finland.  The United States dropped out of the top spot back in 2008 – coinciding with George W. Bush’s last year in the White House – and has been slipping ever since.  The World Economic Forum said the reasons for our decline are debt – loss of faith in government – and corporate ethics.  In other words, 30 years of Reaganomics.

Speaking of Reaganomics, while we are all taught that the United States is the place where anyone – whether they were born rich or poor – can succeed if they just work hard – the reality is the opposite. According to a new Pew report – 1 in 3 Americans who grew up and were raised in the middle class have since fallen out of that economic class today – and now belong to the working poor.  This is the sort of downward economic mobility that is increasing in our nation as wealth inequality also increases – and millionaires, billionaires, and transnational corporations suck more money out of the middle class. The American dream has morphed into the American nightmare.

If you want to be happy for the rest of your life…tax the rich!  A new study out of the University of Virginia makes the connection between happiness and a more progressive income tax.  The study – which analyzed nearly 60,000 people across 54 nations – found that those who live in countries where the rich pay very high income taxes tend to be much happier than in nation where the tax rate is flatter like here in the United States.  The author of the study – psychologist Shigehiro Oishi noted the uptick in happiness among higher-taxed nations was, “explained by a greater degree of satisfaction with the public goods, such as housing, education, and public transportation."  He went on to say, "If the goal of societies is to make citizens happy, tax policy matters…Certain policies, like tax progressivity, seem to be more conducive to the happiness of the people."  So why does the Republican Party hate happiness?

Great white jumps on to research boat

Source: CNN

An 1,100-pound great white shark sits in the stern of a South African research boat

Shark researchers in South Africa didn't have to go far Tuesday to find a specimen - a 10-foot great white shark leaped into the back of their boat. And rather than a story of the big one that got away, this is a story of a big one they couldn't get rid of.

The boat, from Ocean's Research in Mossel Bay on South Africa's southern coast between Cape Town and Port Elizabeth, was chumming in the waters around Seal Island and monitoring the activity of four sharks as part of an ongoing study, researchers reported on their blog.

“Next thing I know I hear a splash, and see a white shark breach out of the water from the side of the boat hovering, literally, over the crewmember who was chumming on the boat's port side,” field specialist Dorien Schroder wrote on the blog. He pulled the crewmember to safety while others jumped out of the way of the 1,100-pound shark.

Schroder said the shark landed with only half of its body on the boat, and the crew hoped it would slide off. This shark, however, wanted to hang around.

The shark thrashed about and became stuck in a 5-by-6.5-foot area on the stern of the boat, cutting the vessel's fuel lines in the process.

Schroder's crew on the Cheetah radioed for help from other researchers aboard the boat Laminade. Schroder poured water on the shark's gills to keep it alive as they waited 15 minutes for help to arrive. Researchers then tied a rope around the shark's tail and tried to use the Laminade to pull it off the Cheetah to no avail.

After the Laminade towed the Cheetah back to port, a water hose was inserted into the shark's mouth to keep it alive as a fishing boat used its crane to lift the animal by its tail and drop it in the harbor.

Shark tale over, right? Not quite.

About a half hour later, the researchers found the shark beached on a small area in the harbor.

Two researchers, Enrico Gennari and Ryan Johnson, tried to walk the animal into deeper water. The shark was having none of it, but the researchers weren't about to give up.

The attached ropes from their boat to the shark's tail and pectoral fins, tilted its head up so its gills could work properly, and towed it about a half-mile outside the harbor, where the shark regained strength and swam away.

Researchers were satisfied.

"It is impossible to predict everything that can happen," they said on the blog. "What is important is how you respond to such situation. No one was injured and the shark survived, this is a credit to our team, the port authorities and members of the community who assisted."

And they do have a whale of a shark story to tell their kids.

Our budget problem in two charts (and one issue)

Source: Ezra Klein / Sarah Kliff

Even as someone who spends a lot of time writing about health policy, this new chart from the Bipartisan Policy Center is still one that gives me a bit of pause:




This chart shows the rise of health care as percent of GDP, compared to other programs that the government spends money on. As the Bipartisan Policy Center’s Loren Adler tweeted shortly after posting the report with this graph, “It’s the health care, stupid!”

One other interesting graph that Adler and co-author Shai Akabas include in their report looks at the role of Medicare and Medicaid in the federal budget. It’s not quite as dramatic, but does make the same point:

Inside the Koch Brothers' Secret Seminar

Source: Mother Jones

"We have Saddam Hussein," declared billionaire industrialist Charles Koch, apparently referring to President Barack Obama as he welcomed hundreds of wealthy guests to the latest of the secret fundraising and strategy seminars he and his brother host twice a year. The 2012 elections, he warned, will be "the mother of all wars."

Charles Koch would probably not publicly compare the president of the United States to a murderous dictator. (As a general rule, he and his brother don't do much politicking or speechifying in public at all.) But Mother Jones has obtained exclusive audio recordings from the Koch seminar, a private event that took place in June at a resort near Vail, Colorado.

These unprecedented recordings provide a behind-the-scenes look at how the Koch brothers and their comrades talk when they gather. They include a pair of keynote speeches and remarks by brothers Charles and David Koch, who spell out their political aims and name some of the "great partners" who have contributed millions of dollars to their causes. (The audio was provided by a source who approached the author after the event was over and was not seeking compensation.)

Security was tight at the Ritz-Carlton Bachelor Gulch on opening night of the weekend conference, which drew an estimated 300 guests. (Past attendees have included prominent politicians, right-wing media luminaries, corporate titans, and wealthy political donors.) Audio technicians even set up outward-pointing speakers around the perimeter of the outdoor dining pavilion, according to sources, emitting static to frustrate would-be eavesdroppers.

"There is anonymity that we can protect," noted emcee "Kevin"—likely Kevin Gentry, a VP for the Charles G. Koch Charitable Foundation — as he gently urged guests to open their wallets in support of the brothers' causes. Indeed, Charles Koch named 32 individuals and families who had donated more than $1 million over the previous 12 months, yet because of loopholes in federal campaign law, their donations do not exist in the public record.

Charles and David Koch are co-owners of Koch Industries, an energy and chemical conglomerate inherited from their father that is currently America's second-largest privately held company. To date, the brothers have spent more than $100 million supporting hard-right political campaigns and institutions. They are key funders of the movement to discredit climate science and sow doubt on the scientific consensus that human activities contribute to global warming.

The Kochs have tried to keep everything about the seminars secret: the content, identities of attendees and speakers—even meeting locations and dates.

The Kochs also bankrolled the fledgling tea party by making massive investments in right-wing political advocacy groups such as Americans for Prosperity, as detailed by Jane Mayer in The New Yorker last year. More generally, the brothers have dedicated a portion of their vast wealth—and that of their benefactors—to influencing elections across the nation and swaying public opinion on everything from health care and fracking to labor policy and government spending.

The brothers have held their biannual seminars since at least 2003, endeavoring to keep almost everything about them a secret—not just the content but also the identities of attendees and speakers, and even the locations and dates. They've succeeded until recently. Last October, a leaked invite for the Kochs' January 2011 seminar was obtained and published by Lee Fang of ThinkProgress.org. In response, groups including Common Cause and Greenpeace organized a massive protest outside the gates of the resort near Palm Springs where the gathering was held.

According to an agenda for the 2010 Aspen meeting that accompanied the leaked invitation, previous Koch seminars have featured "such notable leaders" as Rush Limbaugh and Glenn Beck, Sens. Jim DeMint (R-S.C.) and Tom Coburn (R-Okla.), and Reps. Paul Ryan (R-Wis.) and Mike Pence (R-Ind.). Supreme Court Justices Antonin Scalia and Clarence Thomas also have attended.

Several GOP governors made it to the Vail seminar in June, among them Florida's Rick Scott, Virginia's Robert McDonnell, and White House hopeful Rick Perry of Texas. News of the event slipped out after McDonnell put the trip on his weekend schedule; neither Perry nor Scott initially disclosed the trip to their constituents. A Perry spokesman acknowledged his attendance only after the Austin American-Statesman tracked the tail number of a plane belonging to one of the governor's top donors from Texas to Colorado. He described the summit as a "private gathering of business leaders."

Koch read off the million-dollar honor roll, a list of 32 donors who have made seven-figure contributions to the brothers' efforts.

I contacted the Kochs numerous times with questions about the seminar, requesting clarification, for example, on Charles' Saddam Hussein reference. Without addressing the specifics, a spokeswoman for the Kochs merely pointed me to a Koch Industries web page describing the conference. (UPDATE: A Koch spokesman gave ABC News' Jake Tapper a statement claiming that Koch was "not referring to President Obama in his remarks." Listen for yourself below.)

During his welcoming remarks, Charles Koch warned his guests that the 2012 elections are nothing short of a battle "for the life or death of this country." He then acknowledged the individuals and families who had given more than $1 million to the brothers' efforts—though he misspoke, saying "more than a billion," earning a huge laugh from the crowd. "Well, I was thinking of Obama and his billion-dollar campaign," Koch said, to more laughter and cheers. "So I thought, 'We gotta do better than that.'" (Forbes pegs the brothers' personal net worth at around $22 billion apiece.)

(The complete audio and transcript of his remarks are available at The BRAD BLOG.)

Koch then proceeded to read off the million-dollar honor roll, a list of 32 names that we have cross-checked against the published list of 2010 attendees, as well as additional sources. The list features many well-known GOP donors including John Childs (JW Childs Associates), Rick and Helen DeVos (Amway), Dick and Joyce Farmer (Cintas), and Diane Hendricks (ABC Supply). MoJo's Gavin Aronsen breaks it all down in his post, "Exclusive: The Koch Brothers' Million-Dollar Donor Club."

Concluding his reading of the list, Charles quipped that there were "10 more [million-dollar donors] who will remain anonymous, including David and me... We're very humble... The plan is the next seminar I'm only reading the names of the $10 million," he added, to laughs from the crowd.

Charles spoke again the next evening, following a keynote speech by Fox News host and retired New Jersey Superior Court Judge Andrew P. Napolitano. The judge didn't stray far from his usual libertarian fare; he was met with hardy approval when he declared that the Second Amendment was created to ensure "the right to shoot at the government if it is taken over by tyrants."

Among Napolitano's other revelations: that he sometimes gets in "a little bit of trouble" from his employers at Fox for being tough on Republicans; that Fox hired him on the strength of his televised advice, during the contentious 2000 Florida election contest, that the Bush-Cheney campaign should take its case straight to the US Supreme Court; that he views the PATRIOT Act as the "the single most abominable, hateful, unconstitutional piece of legislation [ever] enacted"; and that he believes former Attorney General Alberto Gonzales undermined the Constitution when he threatened to prosecute the New York Times for exposing spying by the National Security Agency.

(Read excerpts from Napolitano's speech The BRAD BLOG.)

Napolitano closed his address with a well-worn Thomas Jefferson quote: "When the people fear the government, there is tyranny. When the government fears the people, there is liberty."

At this point, Charles Koch returned to the podium. "We've talked about our competitive disadvantage, how we're overwhelmed in a number of areas," he said. "One of those areas, of course, is the media—and we're overwhelmed. The media is 90-plus percent against us. But we have a few bright stars, and Judge here is one of 'em.

"We are absolutely going to do our utmost to invest this money wisely and get the best possible payoff for you in the future of our country."

"Now, we've opined on what you should do, and you have to go execute. And I'm sure you'll do a great job," Koch said. "We've had great discussions, great arguers, I think great programs, great initiatives. And last but not least, I want to thank all of you who stepped forward so generously to support this as you've done in the past. And I want to give all of you a big hand for stepping forward to save our country."
The crowd applauded itself.

"We've had a lot of tough battles," he continued. "We've lost a lot over the years, and we've won some recently.…And I pledge to all of you who've stepped forward and are partnering with us that we are absolutely going to do our utmost to invest this money wisely and get the best possible payoff for you in the future of our country."

But "it isn't just your money we need," Koch added. "We need your energy. We need you bringing in new partners, new people. We can't do it alone. This group can't do it alone. We have to multiply ourselves. Just as to change the media we just can't have the judge. We need to clone him thousands and thousands-fold.

"And so, thank you so much," Koch said. "God bless you, and God bless America."

Bill Gross discusses structural impediments in the American economy

Quote from Bill Gross at Pimco:

The problem I have with free market capitalism...the apparent exhaustion in the face of three equally dynamic economic influences. Globalization has weakened American economies by siphoning off investments and jobs to emerging nations at 1/10 the wage cost. Take China, for example. Free market capitalism, in other words, is working for China and Brazil, but it's not working for America or Euro land. Secondly, and just briefly, free market capitalism depends on a balanced market between labor and capital. And clearly we're reaching a point where impoverished main street cannot afford to buy the goods that capitalism so magnificently produces. So I think there's an exhaustion here in terms of free market capitalism that has worked so well for 20 to 30 to 40, 50 years, but now is reaching structural impediments that prevent, you know, strong growth that we're used to.

If unemployment stays at 9% plus and if real wage gains are non-existent, then where is the spending power coming from? It has to come from a consumer as opposed to businesses. Businesses are waiting on the consumer. The consumer is waiting on business.

(Source: CNBC)

Obama's Fantasy

Excerpt from Martin Wolf's article "Struggling with a great contraction":

Mr Obama wishes to be president of a country that does not exist. In his fantasy US, politicians bury differences in bipartisan harmony. In fact, he faces an opposition that would prefer their country to fail than their president to succeed. Ms Merkel, similarly, seeks a non-existent middle way between the German desire for its partners to abide by its disciplines and their inability to do any such thing.

(Source: FT)

The Debt Non-Explosion

From Paul Krugman

A conversation I had earlier today suggested that it might be worth pointing out a fact that isn’t as widely known as it should be: namely, that there has not been an explosion in debt over the past few years. There has been a big rise in federal debt, but this has gone along with a collapse in private borrowing, so that overall debt growth has been lower than it was in the pre-crisis years:

Source

Bear this in mind when someone starts ranting about hyperinflation just around the corner thanks to explosive debt growth.