Austerity's Strange Logic

I have had a few things to say about Social Security over the years (including here, and here). My prime concerns have focused on how mischaracterized it is as a drag on the federal debt, which it isn't, and how successful it has been, despite repeated and wildly inaccurate claims to the contrary.

A recent article by Marty Wolfson has helped put some perspective on how Social Security works, and why current attempts, by Republicans mostly, but also by some Democrats, to curtail it in the name of austerity is so wrong. When speaking of the federal debt, Wolfson reminds us that: 

Two quick points should be noted here: 1) Recall the long-standing theme presented mostly by Republicans who howl that social security will run out of money by (insert scary date here), and use that questionable assertion as evidence that social security does not work, and that the solution is to either privatize it or cut benefits immediately. The implication is that cutting benefits will reduce the Social Security payout and thus increase its viability. Two) Although supporters of social security like to point out, correctly, that the program pays for itself, by law, through contributions, I now think I see why conservatives believe the system adds to the federal debt. By law, paid-in Social Security contributions don't sit in a shoe box, nor are they invested in stocks, like Wall Street would like. The US government takes the $ billions in cash it receives each year and puts it in Treasury securities. As Wolfson puts it:

The $17 trillion (federal debt) figure is a measure of “gross debt,” which means that it includes debt owed by the U.S. Treasury to more than 230 other U.S. government agencies and trust funds. On the consolidated financial statements of the federal government, this intragovernmental debt is, in effect, canceled out. Basically, this is money the government owes itself. What is left is termed “debt held by the public.” It is this measure of debt that is relevant to a possible increase in interest rates due to competition for funding between the private and public sectors. It is also the category of government debt used by the Congressional Budget Office and other analysts. (Of course, the full economic significance of any debt measure needs to be considered in context, in relationship to the income available to service the debt.) The total debt held by the public is $12 trillion. 

The Social Security Trust Fund comprises $2.7 trillion of the total $5 trillion of various US Treasury debt instruments held in those myriad intragovernmental accounts. Not bad for a governmental agency that is supposedly going broke.

Social Security accumulated all these Treasury securities because of the way that its finances are organized. Social Security benefits to retirees (and to the disabled) are paid for by a payroll tax of 12.4 % on workers’ wages (with 6.2% paid by the worker and 6.2% paid by the employer), up to a limit, currently $113,700. If, in any year, Social Security revenue is greater than what is needed to pay current retiree benefits, the surplus must, by law, be invested in Treasury securities (most of which are “special obligation bonds” issued only to the Social Security Trust Fund).

So why are the calls for austerity so ill-advised?  And why is it so obvious to those of us who bother to research the issues (and have a coherent analytic framework, but I digress) see that "fixing" Social Security is not the true objective? The fact that the program is running up large surpluses which then must be parked in Treasury securities sounds good in a way; surpluses sound better than deficits, which would surely drive fiscal hawks crazy. I'm guessing that some congressional supporters in years past helped to ensure a surplus condition so that conservative critics would have less to bitch about. No such luck, for now the critics bemoan the large surplus the Social Security Trust Fund now maintains, though they invariably just call it debt, and then they still insist that the money will run out in, what?, 28 years? 75 years? As if suddenly there were no adjusting allowed, as we have successfully done in the past.

Here is the simple reality. The Social Security Trust Fund was not envisioned to have such large surpluses as it currently has. The fact that there is a meaningful surplus is a signal that contributions are unnecessarily high, or that the payout in benefits is needlessly low, or some combination of the two.

As Wolfson writes: 

Therefore the $2.7 trillion of Treasury securities held by the Trust Fund came about not because entitlements are out of control and the government has been forced to borrow to meet retiree benefits, but rather because future retirees have paid more taxes than necessary to meet benefit obligations. Workers have essentially been prepaying into the Trust Fund in order to provide for their future benefits.

The most pointedly ignorant response, the one that Congressional Republicans keep making, is to suggest that we cut benefits. Doing so will only serve to drive the imbalance further by decreasing the outflow of benefits and further increasing the need to issue or maintain Treasury securities for the inflow of money earmarked for future claims. It is precisely the opposite of what austerity proponents claim. A far more useful solution would be to increase benefits, and pump more money into the economy and at the same time reduce the need to buy ever more Treasury securities. 

A careful reading of Republican proposals and positions makes it clear that actually fixing most government institutions, programs, or issues, is no longer that party's objective, certainly not with this tea bagging crowd. The most jaw-droppingly obvious solutions, which have worked well in the past, are studiously avoided, and kept from the public, the media, and legislative consideration. And that is because the objective, not of all conservatives, but of true Tea Party devotees, is to emasculate the federal government. Those who actually read American history know this has always been the case.

Democracy's Ills

How does that quote go again: "These are the times that try men's souls"? There is a frustrating duopoly at play; in our elections, in civil discourse, in our constitution, and certainly in our strained sense of democracy. We have come to learn, again, that our constitution is flawed and limiting. We, or most of us, say we support democracy, but we can't avoid the question as to why democracy and free elections have led us to the abyss. We speak of equality, think of ourselves, naively, as a classless society, and insist on such time-tested homilies as equal representation, or no taxation without representation (yeah, that's a good one). We have created or inherited a political system that we once urged, or sometimes forced, upon the world but which is now badly failing us.

On the one hand we continue to espouse boilerplate straight from civics class: freedom of expression, free markets makes for free people, a free press is the bedrock of a free society, all this freedom wrapped in a proud belief that minimum government yields maximum democracy --but it's all painfully juxtaposed against the urgently felt need to take back the public arena from the oligarchs, the corrupt, and religious fanatics. We, most of us, value freedom of speech; some of us still venerate the oh-so-learned Supreme Court for protecting our rights, but how many of us really believe Citizens United was a good decision? Or that denying the hyper-wealthy--or corporations--the right to buy elections, politicians, and the media is an affront to their free speech? 

On the other hand, do we know, or care to know, how much voter ignorance and apathy have contributed to our condition? I didn't vote for the jackasses that say we need to cut social security and food stamps from the poor because that's a good way to balance the budget. But millions did.

We may lament that people vote for selfish or irrational reasons, but we must remind ourselves that in the formative years of our republic, universal suffrage was seen as a horrible idea by the aristocracy and most of the founding fathers. The argument always given was that commoners, the illiterate, women, the melanin-enriched, the unpropertied, all of them would make poor voting choices. Specifically, they would vote themselves goods and services that were economically unsustainable, and would destabilize government. They usually left unstated their fear that the power and privileges of the upper class would be threatened by true democracy. 

So it might seem ironic that the most powerful and privileged in society, and among the best educated, are now the ones pushing and protecting policies, practices and legislation that are selfish, reckless, and demonstrably unsustainable. The middle class largely supports the same stabilizing policies of the past, including responsible taxation, support for the self-funding and efficient social security system, regulations that return us to the decades of stable banking we once enjoyed, and more.

And yet just enough people vote for politicians who have made it clear they don't want Americans to have better health care, have no intention of reining in Wall Street, will forever feed the military-industrial gravy train, and consistently vote for the interests of the wealthy and against the poor and working class. 

The real tragedy of American democracy is not just that so many politicians, mostly Republicans, actively support a Dixified nation with a small ruling class at the bidding of corporations. It is that many others, mostly Democrats, claim to support working class folks, but end up going along with the money train; it is they who will settle for scraps and claim progress; it is they who will support legislation so weak, toothless, and watered down as to be useless. They, not all, but too many of them, want you to believe they are fighting for middle America. 

What is depressing about this is though there are many politicians who want to and try to do the right thing, there always seems to be enough politicians, either outright reactionaries or compromised "moderates" who either bitterly oppose anyone who tries to do anything that most Americans actually support, or quietly insist-mostly at election time--that they are for you, but cannot or will not actually promote legislation that is, in fact, popular. Who do they think votes them into office? Why don't they get behind legislation that their base supports? You would think that far-right Republicans would abandon bills that even their Republican base is cool to, just as Democrats should be more enthusiastic about, say, a minimum wage increase. How politically popular does something have to be before Democrats will come out of hiding and publicly support it? It's as if they would rather dodge the attacks from Republicans and right-wing media, and chase Wall Street dollars, than respond to the voters who actually put them into office. It is little wonder that so many of America's poor and working class are disaffected and don't bother to vote. 

But hey, congrats to Harry Reid on filibuster reform; you too Diane Feinstein. It took you a while, but you finally decided that after years of record obstructionism that you should step in and actually do something about it. Too bad it took you five years to notice what Republicans were doing to the economy, the political process, and your party's president.

Dude, Where's My Pension?

One of the most egregiously inaccurate memes in America today is that there is a large class of takers/losers/slackers/Democrats who rake in money, benefits, and services they did not earn so they can continue an indolent lifestyle. They take it, as the story goes, from hard-working Americans, the ones who have jobs, pay their taxes, are pro-family, and vote Republican. I can hear it now: "This country would be fine if it weren't for certain of us getting what they don't deserve."

But as has been so common as of late, redstate angst has been fueled and then redirected by those who jerk their nose ring. One wonders how unequal wealth has to get in this country before all of us, not just some of us, realize how jaw-droppingly wrong the "creators vs takers" mythology really is.

Wall Street continues to play the central role in the trickle-up of assets from the middle class to the one percent. One way not well publicized, no surprise, is how these financiers raid public pension funds.

First a prelude. You have undoubtedly heard how burdensome state and local pension funds have become and how the gap between funded and unfunded obligations continues to grow. It is this growing gap that has conservatives howling about how public employees, goaded on by their reckless unions, are destroying state finances. Underneath it all is the conviction that the teachers and other workers have padded themselves enormous nest eggs they not only don't deserve, but have to be paid by the rest of us. Teachers living high on the hog? Who knew?
  
That brings us to Matt Taibbi, a journalist among the best at getting at the facts and telling a great story, especially the kind oligarchs would prefer you didn't hear. In a recent Rolling Stone article, Taibbi relates how pension funds are being looted by Wall Street. There is a lot in it, including some background on Rhode Island Treasurer Gina Raimondo and her Wall Street-financed role in gutting her state's public pensions and how Rhode Island became a model now being inflicted on the rest of us.

I urge you to read it all, but I'll highlight several points here. Whiz-kid Raimondo helped push through state legislation a cynic would call "pension reform", but financiers call gravy. The new legislation has enabled Raimondo to turn over millions of dollars of pension assets to hedge funds, who have the unmatched ability to generate huge fees, regardless of performance. Worse, the hedgies are run by ideologues who sit on the board of the Manhattan Institute, a conservative think tank that promotes privatizing public pensions. Nice way to get paid.

One implication, as Taibbi notes, is that Rhode Island's public workers are losing control of their assets, where they are invested, and how hefty the fees might be.

The state's workers, in other words, were being forced to subsidize their own political disenfranchisement, coughing up at least $200 million to members of a group that had supported anti-labor laws. Later, when Edward Siedle, a former SEC lawyer, asked Raimondo in a column for Forbes.com how much the state was paying in fees to these hedge funds, she first claimed she didn't know. Raimondo later told the Providence Journal she was contractually obliged to defer to hedge funds on the release of "proprietary" information, which immediately prompted a letter in protest from a series of freaked-out interest groups. Under pressure, the state later released some fee information, but the information was originally kept hidden, even from the workers themselves. "When I asked, I was basically hammered," says Marcia Reback, a former sixth-grade schoolteacher and retired Providence Teachers Union president who serves as the lone union rep on Rhode Island's nine-member State Investment Commission. "I couldn't get any information about the actual costs."

 Taibbi goes on to say:

Today, the same Wall Street crowd that caused the crash is not merely rolling in money again but aggressively counterattacking on the public-relations front. The battle increasingly centers around public funds like state and municipal pensions. This war isn't just about money. Crucially, in ways invisible to most Americans, it's also about blame. In state after state, politicians are following the Rhode Island playbook, using scare tactics and lavishly funded PR campaigns to cast teachers, firefighters and cops - not bankers - as the budget-devouring bogeymen responsible for the mounting fiscal problems of America's states and cities.

Taibbi tells us that the looting began as early as 1974, with the passage of ERISA, the Employee Retirement Income Security Act. Not a bad law, as it was intended to protect retirement accounts in sundry ways. Unfortunately, congress saw to that a huge loophole exempted public pensions. And that is when the fun began. The loophole in ERISA is what has allowed politicians of all stripes to raid --they would say "borrow"-- public pensions to redirect funds to more immediate needs, some worthy, some less so. But this is the reason there are unfunded pension liabilities; it's easier to borrow than it is to pay back.

It is not unlike social security, which has grown an enormous surplus-- the opposite of what conservatives tell you--only to see it "borrowed." Paying back the unfunded pension plans, just as putting the money back into the Social Security Trust Fund, is indeed painful, but it is not because the funding requirements have been onerous. Wall Street and mostly Republican politicians want you to think they are, so you will acquiesce to the ongoing destruction of middle class pensions.  

This shit gets so depressing. What galls me is not just that Wall Street and the politicians it has bought continue to reshape the country to suit moneyed interests, it's that so many of us don't see it, or believe crap that tries to pin it all on unions, spending, deficits, or those "job-killing" regulations. People at the top, where the money and power are, have convinced people in the middle, where the votes are, that undeserving people at the bottom, where the misery is, are the problem.

Our Free Press is Failing Us

As a kid growing up, long before the Internet, I thought that any bit of substantive news that made it out of one source, such as a big-city newspaper, would inevitably get widely disseminated by other sources, another newspaper, then another, then the 6 o'clock news, the weeklies. It would all happen quickly and efficiently, whether you liked it or not.

Now, and only partly because of the Internet, several uneasy trends have become apparent:  1) that bit about "substantive news" getting widely disseminated was probably never true, though arguably more so than now, 2) news is more shallow and dumbed-down now than in the past, and 3) though the Internet has opened up numerous sites to tap for data and commentary, and has given us unprecedented opportunity to explore ever further afield, it has also made it easier for us to pursue our preferences and ignore the rest. In so doing, we have erected philosophical, ideological, and religious filters that tend to confirm our world views rather than challenge them.

Nor has the Internet compelled the mainstream media to be more balanced, or to even cover stories, viewpoints, and evidence that discerning readers--and alternative news enthusiasts-- know exist. And that can happen--is happening--with major subjects that affect us all.

Ask yourself how many corporate-owned news organizations are covering the efficacy of raising the payroll tax cap on Social Security. Over and over we hear the major outlets argue for, or repeat the talking points of the investor class on Social Security: it is in trouble, it is a big part of the budget deficit, and we need to cut benefits to those who desperately need it because doing so will narrow the federal deficit and somehow spur growth. Here is an example of how our feckless media allows conservative politicians to misrepresent Social Security.

The reality is that over the years Social Security garnered a roughly $2.5 trillion surplus, a surplus that Congress has tapped to fund other programs. And now Congress does not want to pay it back. Doing so would draw attention to ethically questionable action; messing with people's retirement. And yes, the claim that social security is nearly bankrupt, wrong in the first place, is especially galling given the surplus it ran up which Congress then "borrowed." The real kicker is that a simple tweak like raising the payroll tax would also reveal the viability of social security, which contradicts the mostly Republican narrative that Social Security is failing us. It should be clear now that Republicans don't actually want to strengthen social security. This is why they seem so tone deaf to simple solutions: They are not looking for solutions and they don't want talk of solutions to enter the debate. Policy experts, economists, and so many others have, often in great detail, made it clear the "sky-is-falling" talking points are egregiously inaccurate. Here are some facts on social security.

One may disagree on complex policy issues while acknowledging that there is room for alternative views. Our media should be asking why Congress does not remove the Social Security cap. Let opponents defend their refusal publicly. Challenge their insipid talking points. But we are not even having that debate, not publicly, not with any consistency or honesty.

Social Security's Biggest Defender

Here is the guy voters have been told to shun, ridicule, and oppose at every opportunity. Why? Because Senator Bernie Sanders is un-American, he hates your values, and he wants to enslave you in government-run welfare camps.

Right? I mean these are the kind of tight, reasoned arguments that true patriots like Sarah Palin make about Sanders. They must be true. After all, Sanders is the only avowed socialist in Congress and we all know what they want. If you have any doubts, Sarah will tell you, for a fee, all you need to know about socialism (and everything else).

Those who value facts over diatribe know that Senator Sanders is one of the few who consistently works for the rest of us. Listen to Sanders on social security in the video below. His is one of the few voices in Congress that pushes back against the asinine and palpably wrong argument that social security doesn't work, it is killing the budget, and must be cut. Republicans are leading the assault, but more than a few Dems are willing to give in instead of defending your interests.

Aggressive, moneyed interests in the Republican party; Weak, hand-wringing facilitators in the Democratic party. No wonder Sanders is an independent.

And No Regulations Too

Wall Street says you can do better investing with them than with Social Security. Yes, you can... except when you don't.

Social Security Works

I have posted a few times about Social Security and the surreal atmosphere in Washington, fomented primarily by Republicans, that wants you to think SS is not working, is nearly insolvent, and must be privatized because it is a drag on the federal budget.

These contentions are all demonstrably false. (My previous posts on SS are here.) Now I see the AARP Bulletin for June, 2011 (print edition) has an article by James Roosevelt, Jr., the grandson of our greatest President, entitled Social Security's Enduring Truths (p. 32).

Roosevelt notes that detractors have been lying about SS since its inception. Alf Landon, the Republican nominee in 1936, called Social Security "a hoax." The Republican platform for that year called SS "unworkable."

"...Social Security has not only been the most effective government program, it has been the most responsible government program. It does not and cannot borrow money to finance its operations. There is no deficit financing. Social Security is the epitome of Yankee frugality. It could not be better managed. The administrative cost is .09 percent. It returns more than 99 cents to beneficiaries on every dollar collected. I dare you to find a private retirement  plan that can claim that."

Well said. Now see the video below where Congressman Dennis Kucinich makes essentially the same argument.



The real tragedy in this, and a terrible indication of what is wrong with modern public discourse, is that these facts matter not a whit to conservative ideologues. They are not interested in what works. They hate government, especially successful programs that contradict their dangerous obsession with privatization. Social Security works well. It is the centerpiece of the New Deal and helped to create the middle class. Conservatives cannot accept that, they cannot dispute the facts, so they have to lie about it.

The US Could Really Use a Third Party

Here is Cenk Uygur laying into a Representative Earl Blumenauer, who, as a member of the Progressive Caucus, is supposed to fight for the middle class against the Republican efforts to turn over even more of the economy to Wall Street.

But even Blumenauer acts like he gets his talking points from Paul Ryan. What the hell is wrong with Democrats when they say that raising the retirement age for social security is negotiable?

This is not specifically about the retirement age; that issue alone is not a cure-all, and it isn't the end of the world either. The huge problem in all of this is that Republicans have set the parameters and they have got at least some feckless Dems, including Blumenauer, to negotiate within those parameters. The result is that every piece of budget-related legislation that has come from the House has involved funding cuts for America's poor, its children, its elderly, the dispossesed, and the working class, or it involves tax cuts, and deregulation for the investor class.

What Blumenauer needs to say is that it is ridiculous to even be discussing a raise in the retirement age for social security in the first place. Instead of shit about people living longer, he should be hammering home the fact that even in this slow economy, SS is once again running a surplus, a fact that completely undermines scare talk about "fixing" it.

Social security was able to run up a $2.6 trillion surplus thanks to tweaks made in the early 1980s (under Reagan!). The problem is not with social security, which has worked extremely well; the problem is that politcians "borrowed" that surplus and blew it on other programs, wars, and tax cuts for the wealthy. And now they do not want to pay it back. Republicans want you to think that SS is a huge drain on the federal budget. They are lying through their goddamn teeth.

So why can't guys like Blumenauer make these points? Dems are not fighting back on issues like social security, which should be easy to defend. It's a freakin slam dunk as far as the facts are concerned. 

Cenk hammered him for it, and Cenk was absolutely right.



hat tip to moxnews.com

Social Security Records Surplus

No wonder Republicans want to end social security; they hate federal programs that work and get in the way of their ideology. I have to admit that, as a kid growing up, and even much later, I did not really appreciate the right wing animosity towards social security. Perhaps that is because they kept their sociopathy to themselves, or because they didn't have nearly enough votes. And to think, they want to turn SS over to Wall Street, the same folks who put the economy in the ditch in the 1980s, first with the S&L scandal, and then the crash of '87, and again in the 1990s with the dot.com bubble, and again in 2000's with the still festering housing/mortgage bust. Along the way they have eviscerated 401-k's, pensions, and many IRAs.

So once again, as designed, social security records a surplus.

Today the Social Security Trustees released their Annual Trustees Report for 2011.  The following provides comment and analysis from the Strengthen Social Security Campaign, a coalition of more than 300 organizations representing more than 50 million Americans:  (Click here for a complete pdf of the press release)

“The trustees’ report found that Social Security's surplus will be $69.3 billion in 2011.  Those who say that Social Security is in deficit this year are flat wrong,” said Nancy Altman, Co-Chair of the Strengthen Social Security Campaign. “By law, Social Security cannot deficit-spend and cannot borrow, so it is obvious that Social Security cannot add a penny to the federal deficit.”

 

“The trustees’ report states that Social Security will be able to pay all benefits for the next quarter century, even without congressional action. Bottom line, Social Security works,” said Eric Kingson, Co-Chair of the Strengthen Social Security Campaign. “Even in a bad economy, Americans continue to receive the full benefits they have earned for themselves and their families. The trustees report makes clear there is no reason to cut benefits—not for today's seniors; not for any generation.

Note that social security does NOT contribute to the deficit and the funds are NOT borrowed.

Put Some Sugar in His Gas Tank While You are at it
Ok, this is not breaking news. But it is an indication of how are leaders are spending their time.  As reported by Yahoo News back in February:

Republicans weren't joking when they said they would go after funding for President Obama's pet programs.

Per Wonkette, GOP Rep. Steve Womack of Arkansas filed an amendment to a House spending bill this week that would have cut funding for the president's Teleprompter. Womack later pulled the amendment because he couldn't find out how much the measure would actually save, but told Fox News he believes he made his point. 

"We're asking people to do more with less, and I think the president ought to lead by example," the GOP lawmaker said. "He is already a very gifted speaker. And I think that's one platform he could do without."

 And what is the point you believe you made, Womack? That you are a petty asshole?
No wonder this government cannot get anything done.

I'm with this guy
Scott McLarty has a post up at OpEd News where he says to "stop calling them conservative." The behavior and policies of today's Republicans would be unrecognizable to most conservatives of the past, including Goldwater.

They Want Your Social Security

This is excellent. In the video below, Cenk Uygur again states the facts about social security and comes to the unavoidable conclusion that Republicans, and a few blue dogs as well, are absolutely lying about social security.

Republicans say we must cut back benefits because they are hurting the deficit, but social security does not add to the deficit or debt. It continues to pay for itself and then some; roughly $2.5 trillion in surplus. Cenk notes that the surplus has been "borrowed," which points more to Congressional thievery, and not to any shortcomings with SS.

Cenk lays all of this out very well. It is a fantastic spectacle to see conservative politicians insist the working class must work even harder, and sacrifice even more, after extending tax cuts to the wealthiest two percent. It is all incredibly blatant, almost like a clumsy parody. I never thought I would see such a brazen and concerted effort to turn over ever more wealth and power to the financial elite.

I agree with Cenk that Republicans want to privatize social security for the benefit of Wall Street. And they are indeed lying when they say we must cut back now so as to ensure social security's future. Their long-term goal is undoubtedly to gut social security and privatize retirement. But their short-term goal is reduce benefits so that SS will begin running up an even greater surplus, one they can continue to borrow from, just as they, Republicans and Democrats alike, have been doing for years. They will take whatever surplus is created and spend it on war and tax cuts. They don't give a shit about fixing social security, and they don't want to pay back the trillions they have already borrowed. But if they want SS to be the perpetual golden goose, they have to convince you that it is a failure and that we cannot afford it. Republicans won't raise taxes, but they can get the same result by slashing benefits to middle class retirees. They have no problem doing that.

Visit msnbc.com for breaking news, world news, and news about the economy

Policy Preferences and Democratic Weakness

On Wednesday I shared a small taste of Bill Maher's skeptical attitude about American voters' understanding of issues and policies. He, of course, is not the only one who notes a wide and long-standing anti-scientific, anti-intellectual streak in this country.

Is it getting worse? It would seem so, in part because of a new level of right-wing aggressiveness, much of it associated with Sarah Palin and teabaggers. Palin sneers at those pointy-headed intellectuals, and the teabaggers eat it up. In her crowd, anti-science has become fashionable and, perversely, is viewed as virtuous.

And yet...  

RJ Eskow, a Senior Fellow with The Campaign for America's Future, cites many reasons to feel good about the wisdom of Americans, at least a majority of us. He has collected some impressive polling data, complete with compelling pie charts that show clear majorities of Americans prefer progressive legislation and policy choices. To wit:

     1.  A large majority opposes cuts to social security;

     2.  Seven in ten oppose raising the retirement age;

     3.  A plurality says to raise taxes on the wealthy;

     4.  Nearly 4 in 5 are against cuts in Medicare;

     5.  Nearly 2 in 3 oppose cuts in lending for college tuition;

     6.  About 6 in 10 say to do more to assist unemployed workers

     7.  4 in 5 say to do more to reduce poverty
     8.  Seven in 10 favor more regulation on Wall Street

Such clear preferences do not demonstrate that people actually understand the details or implications of their choices (3 in 10 don't favor Wall Street regulation?); but they do show that most people want government to help them, not get out of the way, as Republicans since Reagan have claimed. 

As I have posted before, it is essential that we understand the role of political identity. The polls Eskow cites suggest most American prefer, wait for it -- socialism -- a strong dollop of the European model, complete with much more equitable income distribution (say it ain't so Ayn Rand). Many gravitate towards Republicans because it suits their personalities. They want to see politicians project strength, conviction, and detemination. Republicans may have an unusual obsession with swagger, symbolism, and simplistic interpretations of complex issues, but nobody likes to see weakness in their elected officials. And that is what we have mostly seen in the last two years with Dems in the White House and Senate.

People want the Democrats to win, but they have no patience with any party that says it stands for the middle class and then repeatedly squanders its opportunities. Many Americans may be uninformed, many have short memories, and many are impatient, not realizing how long it takes to turn our economy around. Those are faults of the electorate that complicate governing in the US. But nobody is making Democratic politicians look weak except themselves.

Republicans write the script only because Dems let them.

Myths vs Facts

Below is an excellent list of myths about President Obama that far too many people believe are true. For this you can thank the congenital liars in the Republican Party, a captured media, as well as an unfortunately large, pervasive swath of voter ignorance. The White House's inability to get its message out, especially in the face of the incessant right-wing noise machine, ain't helping.

The list, along with the links, was originally compiled by Dave Johnson at Campaign for America's Future. Many thanks to Dave for his excellent work.

 * * *

There are a number things the public "knows" as we head into the election that are just false. If people elect leaders based on false information, the things those leaders do in office will not be what the public expects or needs.

Here are eight of the biggest myths that are out there:

1) President Obama tripled the deficit.
Reality: Bush's last budget had a $1.416 trillion deficit. Obama's first budget reduced that to $1.29 trillion.

2) President Obama raised taxes, which hurt the economy.
Reality: Obama cut taxes. 40% of the "stimulus" was wasted on tax cuts which only create debt, which is why it was so much less effective than it could have been.

3) President Obama bailed out the banks.
Reality: While many people conflate the "stimulus" with the bank bailouts, the bank bailouts were requested by President Bush and his Treasury Secretary, former Goldman Sachs CEO Henry Paulson. (Paulson also wanted the bailouts to be "non-reviewable by any court or any agency.") The bailouts passed and began before the 2008 election of President Obama.

4) The stimulus didn't work.
Reality: The stimulus worked, but was not enough. In fact, according to the Congressional Budget Office, the stimulus raised employment by between 1.4 million and 3.3 million jobs.

5) Businesses will hire if they get tax cuts.
Reality: A business hires the right number of employees to meet demand. Having extra cash does not cause a business to hire, but a business that has a demand for what it does will find the money to hire. Businesses want customers, not tax cuts.

6) Health care reform costs $1 trillion.
Reality: The health care reform reduces government deficits by $138 billion.

7) Social Security is a Ponzi scheme, is "going broke," people live longer, fewer workers per retiree, etc.
Reality: Social Security has run a surplus since it began, has a trust fund in the trillions, is completely sound for at least 25 more years and cannot legally borrow so cannot contribute to the deficit (compare that to the military budget!) Life expectancy is only longer because fewer babies die; people who reach 65 live about the same number of years as they used to.

8) Government spending takes money out of the economy.
Reality: Government is We, the People and the money it spends is on We, the People. Many people do not know that it is government that builds the roads, airports, ports, courts, schools and other things that are the soil in which business thrives. Many people think that all government spending is on "welfare" and "foreign aid" when that is only a small part of the government's budget.

More on the Catfood Commission

Here's some more background on the catfood commission and why we are inching towards oligarchy. First, Sabrina1 has some good commentary on the 18 members. The original article appears in Business Insider. Not surprisingly, corporate America is well represented, Wall Street in particular. Look through that list and see if you find anyone who is unequivocably for America's marginalized, poor, or handicapped. Any union members, farmers, or unskilled laborers? Main Street USA? You know, the very people who pay into SS and need it.  There is Andy Stern, that is one for labor, but even he is considering partial privatization.

It is breathtakingly obscene to see three things converging; the first is that most Republicans are insisting that social security, long thought to be an untouchable third rail, should be curtailed (if not outright repealed); second, these same people actually campaign on making the Bush tax cuts permanent; and the third is that most observers sense that Republicans may gain enough seats in November to regain control.
 
So, let's see: the argument is reduce SS benefits to help fight the deficit, though it would have no effect, and keep tax cuts for the rich, though doing so unequivocably will add deeply to that same deficit, and of course, the national debt. Bear in mind they are not implying this, and we are not inferring or reading between anyone's lines: Republicans are saying this explicitly; they are running on it.

These SOBs should be laughed out of the building, but they are dangerously close to returning to power. If that is not a motive to support Democrats, then our fate is sealed.

There is No Social Security Crisis, Mr. President

There is no social security crisis, so why is President Obama letting Republicans dominate the Deficit Commission, otherwise known as the catfood commission, as if there were? Perhaps you have seen the repugnant Alan Simpson, former Senator for Wyoming, dismissively refer to social security as "a milk cow with 310 million tits." Nice guy. And it overlooks the fact the people spend a lifetime of working, all the while contributing to social security. In other words, people pay into it, but Simpson acts like recipients are addicted to something they don't deserve. 

The commission was originally tasked with addressing the federal deficit. That is a semi-legit subject, but a politically dangerous tactic for President Obama because the commission has chosen to concentrate on social security, which is solvent and does not contribute to the federal deficit.  Unless, of course, Obama buys into the Republican meme that social security must be cut. It sure seems like it. When you look at the people on the commission, you would think it was Republicans who won in 2008

Jane Hamsher has written a detailed and eloquent piece on the catfood commission (as in what Republicans expect retirees to eat if the commission gets its way). Republican disdain for social security is nothing new, but the real news here is Obama's role. Each party in Congress was able to appoint six of their own to serve. Umm, OK. And then the President appointed six members himself, for a total of 18 members. That seems fair too, yes? After all, Obama said he would keep social security strong, right?

Here is Hamsher on who Obama chose:

" * Chairman Erskine Bowles, described by Business Week as 'corporate America’s friend in the White House.' Bowles had negotiated the deal between Newt Gingrich and Bill Clinton to create 'private social security accounts' where 'taxpayers get some choice as to how to invest their contributions.' The deal fell through when the Monica Lewinsky episode jumped into the headlines.
    * As Bowles’ Republican Co-Chair, the President appointed loose cannon Alan Simpson, the former rich kid GOP Senator from Wyoming once famously said that those who were complaining that Social Security needed protection were 'people who live in gated communities and drive their Lexus to the Perkins restaurant to get the AARP discount.'
    * Alice Rivlin was appointed by Obama to be chief wonk of the Catfood Commission, a Brookings Institute fellow who had been funded by Pete Peterson and a strong supporter of raising the retirement age to 70 — resulting in a 20% benefit cut to Social Security recipients.
    * David M. Cote, the Republican CEO of defense contractor Honeywell"

So Alan Simpson was appointed by Obama. Oh, ferchristssake. But who knows? Maybe David Cotes will suggest that defense contractors help disentangle our military-industrial complex. It could happen, no?

Read all of Hamsher's article , including the role of billionnaire Pete Peterson who has worked for years to turn over social security to Wall Street. And for more background on why social security is not broken and why the arguments of Republican operatives are so disingenuous, see here.

This is discouraging. Obama may give in to deficit hawks on an issue that is supposedly untouchable. And he is doing this just before an election. Funny, ain't it how those who howl about how social security is in crisis, and how we must slash spending to reel in our federal deficit never suggest that maybe we take a look at our monstrously bloated defense budget. Or that we raise taxes on the wealthy.

It wasn't the working class that put the economy in the ditch, and it was not they who got $800 billion in bailouts and then rewarded themselves with massive bonuses, as if they actually made that money. That was our tax dollars.

And they accuse us of class warfare.