Tag Archives: The Economy

April 8, 2011 · 11:41 pm

Tax Cuts for the Rich on the Backs of the Middle Class; or, Paul Ryan Has Balls: Matt Taibbi

Great article in Rolling Stone from Matt Taibbi.

I love is snarky tone and accurate facts…

Here is a brief excerpt and I encourage you to click the link to read the rest of it…..

Never mind that each time the Republicans actually come into power, federal deficit spending explodes and these whippersnappers somehow never get around to touching Social Security, Medicare or Medicaid. The key is that for the many years before that moment of truth, before these buffoons actually get a chance to put their money where their lipless little mouths are, they will stomp their feet and scream about how entitlements are bringing us to the edge of apocalypse.

The reason for this is always the same: the Republicans, quite smartly, recognize that there is great political hay to be made in the appearance of deficit reduction, and that white middle class voters will respond with overwhelming enthusiasm to any call for reductions in the “welfare state,” a term which said voters will instantly associate with black welfare moms and Mexicans sneaking over the border to visit American emergency rooms.

The problem, of course, is that to actually make significant cuts in what is left of the “welfare state,” one has to cut Medicare and Medicaid, programs overwhelmingly patronized by white people, and particularly white seniors. So when the time comes to actually pull the trigger on the proposed reductions, the whippersnappers are quietly removed from the stage and life goes on as usual, i.e. with massive deficit spending on defense, upper-class tax cuts, bailouts, corporate subsidies, and big handouts to Pharma and the insurance industries.

via Tax Cuts for the Rich on the Backs of the Middle Class; or, Paul Ryan Has Balls | Rolling Stone Politics | Taibblog | Matt Taibbi on Politics and the Economy.

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April 8, 2011 · 4:31 pm

GOP Budget Proposal: Ludicrous and Cruel

Excellent analysis of Paul Ryan’s GOP Budget proposal by Nobel Prize winning economist Paul Krugman in today’s New York Times:

And then there’s the much-ballyhooed proposal to abolish Medicare and replace it with vouchers that can be used to buy private health insurance.

The point here is that privatizing Medicare does nothing, in itself, to limit health-care costs. In fact, it almost surely raises them by adding a layer of middlemen. Yet the House plan assumes that we can cut health-care spending as a percentage of G.D.P. despite an aging population and rising health care costs.

The only way that can happen is if those vouchers are worth much less than the cost of health insurance. In fact, the Congressional Budget Office estimates that by 2030 the value of a voucher would cover only a third of the cost of a private insurance policy equivalent to Medicare as we know it. So the plan would deprive many and probably most seniors of adequate health care.

And that neither should nor will happen. Mr. Ryan and his colleagues can write down whatever numbers they like, but seniors vote. And when they find that their health-care vouchers are grossly inadequate, they’ll demand and get bigger vouchers — wiping out the plan’s supposed savings.

In short, this plan isn’t remotely serious; on the contrary, it’s ludicrous.

And it’s also cruel.

In the past, Mr. Ryan has talked a good game about taking care of those in need. But as the Center on Budget and Policy Priorities points out, of the $4 trillion in spending cuts he proposes over the next decade, two-thirds involve cutting programs that mainly serve low-income Americans. And by repealing last year’s health reform, without any replacement, the plan would also deprive an estimated 34 million nonelderly Americans of health insurance.

So the pundits who praised this proposal when it was released were punked. The G.O.P. budget plan isn’t a good-faith effort to put America’s fiscal house in order; it’s voodoo economics, with an extra dose of fantasy, and a large helping of mean-spiritedness.

via Ludicrous and Cruel – NYTimes.com.

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April 6, 2011 · 7:30 pm

10 of the Biggest Corporate Tax Cheats In America | AlterNet

I really don’t mind paying my fair share of taxes, but I find it hard to believe it’s fair that I pay more than these Corporations….

If you or I were running a small business and we kept one set of books showing how much money we were making and a second set for the IRS that painted a picture of an enterprise on the brink of bankruptcy, we’d end up behind bars.

But that’s standard operating procedure for corporate America. In fact, public corporations have to do it — the law requires that they keep one set of books for their shareholders, and another for the IRS. As tax journalist David Cay Johnston explained, “Many corporations routinely tell investors they incur millions in corporate income taxes, while the financial records they give the IRS show they owe nothing or are due refunds.”

In the records kept by the IRS, corporations cook the books “by using tax shelters, offsetting income with losses from years ago, and employing countless other devices that make them look like paupers to the IRS but money machines to investors.”We got a peek into this process last week, when the New York Times revealed that multinational giant GE is not only avoiding corporate income taxes this year, but is taking a “tax benefit” of $3 billion. According to the Times, the company’s “extraordinary success is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore.”

But of course, GE is not alone. Here are 10 other big corporate tax evaders (with an assist from an MSNBC analysis of leading corporate tax-dodgers). Keep in mind that neither political party ever actually cuts spending significantly, so every dollar these companies avoid paying is one that will come out of the paychecks of working America.

via 10 of the Biggest Corporate Tax Cheats In America | AlterNet.

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April 6, 2011 · 8:38 am

A Tale of Two Visions: Killing Medicare, Budget Deficits and the Government Shutdown

As usual Robert Reich is dead on in his assessment of the situation in Washington.

Obama is losing the message war to the GOP and Democrats are afraid to stand up for basic Democratic principles- that we are all in this together and are socially obligated to each do their fair share and help each other when age or misfortune falls….

This used to be called Christian Duty- a term which I prefer not to use in a multi-cultural, multi-religious society.  I also hesitate to use this term because Christianity is now viewed as a hard and unforgiving religion by so many thanks to the Religious Right and their role in GOP Politics…

Instead,  I prefer to think of this as Societal or Social Duty.  It is our duty to contribute to the overall good of the nation- not to make this a a dog eat dog world/country  where the motto is “I’ve got mine, screw you.”  That is the GOP vision…

The Democrats need to call this out and fight for the middle class, the elderly, the poor, minority and women’s rights, children and those who work hard but pay more taxes than the idle rich…

Reich calls it out in the Huffington Post:

 

Obama must show America that the basic choice is between two fundamental views of this nation. Either we’re all in this together, or we’re a bunch of individuals who happen to live within these borders and are mainly on their own.

This has been the basic choice all along — when the Founding Fathers wrote the Constitution, in the Civil War, when we went through World War I and World War II and the Great Depression in between, during the Civil Rights movement and beyond.

The president needs to remind us that as members of the same society we have obligations to one another — that the wealthiest among us must pay their fair share of taxes, that any of us who loses our jobs or homes or gets terribly sick can count on the rest of us, and that we have collective obligations to our elderly, our children, and the rest of the planet.

This is why we have government. And anyone who wants to shut it down or cut it down because they say we can’t afford it any longer is plain wrong. We are the richest nation in the world, richer than we’ve ever been. We can afford to remain a society whose members are in it together.

via Robert Reich: Paul Ryan’s Plan, the Coming Shutdown, and What’s Really at Stake.

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April 5, 2011 · 8:59 pm

VA Congressman Proposes Officially Changing Title Of Anti-EPA Bill To ‘Koch Brothers Appreciation Act’

Love this….

From ThinkProgress.org…

Weeks ago, Koch-funded climate change denying Republicans on the House Energy Committee voted unanimously in favor of the Upton-Inhofe bill to eliminate the EPA’s authority to regulate greenhouse gas emissions. The Republican-controlled House is expected to pass the bill later this week and Rep. Gerry Connollly (D-VA) wants to call a spade a spade and officially change the name of the bill to a more appropriate title:

Rep. Gerry Connolly (D-Va.) wants to change the title of a bill that would permanently block Environmental Protection Agency climate regulations to the “Koch Brothers Appreciation Act,” a reference to the billionaire brothers who are active in Republican politics.

via ThinkProgress » Rep. Gerry Connolly Proposes Officially Changing Title Of Anti-EPA Bill To ‘Koch Brothers Appreciation Act’.

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April 5, 2011 · 8:54 pm

CBO: GOP Budget Would Increase Debt, Then Stick It To Medicare Patients

These are the facts…

Now let’s see how the Republicans spin them as they try to kill Medicare…

They usually use their specially created data from the Conservative “Think” Tank, The Heritage Foundation that’s about as credible as Fox News…

However, unlike Faux News and The Heritage Foundation, The CBO is non-partisan, generally accurate and widely respected…

The nonpartisan Congressional Budget Office’s initial analysis of the House GOP budget released today by Rep. Paul Ryan (R-WI) is filled with nuggets of bad news for Republicans.

In addition to acknowledging that seniors, disabled and elderly people would be hit with much higher out-of-pocket health care costs, the CBO finds that by the end of the 10-year budget window, public debt will actually be higher than it would be if the GOP just did nothing.

Under the so-called “extended baseline scenario” — a.k.a. projections based on current law — debt held by the public will grow to 67 percent of GDP by 2022. Under the GOP plan, public debt would reach 70 percent of GDP in the same window.

In other words, the spending cuts Republicans would realize in the first 10 years would be outpaced by deficit increasing tax-cuts, which Ryan also proposes. After that, debt projections under the plan improve decade-by-decade relative to current law. That’s because 2022 would mark the beginning of the Medicare privatization plan. That’s when, CBO finds, “most elderly people would pay more for their health care than they would pay under the current Medicare system.”

If the current Medicare system were allowed to continue, CBO found that an average 65-year-old beneficiary’s costs would be only 25 percent of what it’d be in the individual private insurance market. Under the GOP plan, those costs would jump to 68 percent.

In plain English, “the gradually increasing number of Medicare beneficiaries participating in the new premium support program [the GOP’s Medicare privatization plan] would bear a much larger share of their health care costs than they would under the current program.”

via CBO: GOP Budget Would Increase Debt, Then Stick It To Medicare Patients | TPMDC.

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April 5, 2011 · 7:12 pm

CEO Pay Shoots Up At Expense of Workers | Mother Jones

Some good points from Josh Harkinson at Mother Jones:

Here’s the latest on how much richer the rich have gotten: Last year, according to a USA Today analysis of corporate filings, median CEO pay jumped 27 percent. Compare this to the paltry 2.1 percent pay raise earned last year by the typical American worker.

In general, CEOs did so much better than everyone else due to their generous stock options, which surged concert with last year’s bull market. Wall Street argues that there’s nothing wrong with such incentive-based pay; it alignes the interests of corporate execs with their companies’ shareholders.  But is that all that matters? UMass economics professor William Lazonick notes that a huge chunk of corporate profits last year came not from legitimate gains, but from downsizing:

The fact that CEOs’ pay is rising along with stock prices underscores the disconnect between pay and companies’ true underlying performance, Lazonick says. While companies in the S&P 500 boosted profit 47% last year, much of that was due to cost-cutting and layoffs, not from the creation of businesses and growth, Lazonick says. Revenue, a gauge of the money flowing into businesses for selling goods and services, grew at a much slower pace than profit — and ended the year up just 7%.

So in other words, a 7 percent pay hike for CEOs might have been fair; a 27 percent raise looks a lot more like profiting off the misery of the people who once worked for you.

via CEO Pay Shoots Up At Expense of Workers | Mother Jones.

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April 4, 2011 · 9:16 pm

Dean Baker: It’s Time for Representative Ryan to Man Up

This guy is going to be all over the news the next few days…

He’s the one crafting the Republican Budget that destroys Medicare…

He’s the new darling of the far Right…

I really think the only thing he may be qualified for is to replace the actor playing Eddie Munster in “The Adams Family”…

Look at him closely….

Great article from Dean Baker at the Huffington Post:

Congressman Paul Ryan is the new darling of both the Republican Party and the major media outlets. He has put forward bold plans for dismantling Medicare, Medicaid and Social Security. Congressman Ryan is prepared to tell tens of millions of workers that they can no longer count on a secure retirement and decent health care in their old age. In Washington policy circles, this passes for courage.

Outside of Washington, people have a different conception of bravery. After all, over the last three decades the policies crafted in Washington have led to the most massive upward redistribution in the history of the world. The richest 1 percent of the population has seen is share of national income increase by close to 10 percentage points. This comes to $1.5 trillion a year, or as Representative Ryan might say, $90 trillion over the next 75 years. That’s almost $300,000 for every man, woman and child in the United States.

This upward redistribution creates the real possibility that many of our children will be poorer than we are. If Representative Ryan and his followers really cared about future generations, then we might expect him to push for policies that reverse some of this upward redistribution.

For example, we could break up the large banks (e.g. Goldman Sachs and J.P. Morgan) that operate with implicit government protection. This allows them to borrow money at below market interest rates and undercut their smaller competitors. By my calculations, the size of this subsidy to the largest banks is close to $35 billion a year, almost half the size of the long-term Social Security shortfall that concerns Mr. Ryan so much. If Mr. Ryan could man up a little, maybe he would have the courage to tell the big Wall Street banks that they will have to compete in a free market without this subsidy from the government.

It’s not only the big banks that make Representative Ryan cower. He’s also scared of the pharmaceutical industry. As a result of government-enforced patent monopolies, we spend close to $300 billion a year on drugs that would cost us around $30 billion a year. The potential savings of $270 billion a year is about three times the size of the projected Social Security shortfall.

Representative Ryan is a big fan of Medicare vouchers, however his voucher system does nothing to address our broken health care system while virtually guaranteeing that most seniors will not be able to afford decent health care. How about a voucher system that gives Medicare beneficiaries the option to buy into the more efficient health care systems in Europe and Canada, with the taxpayer and beneficiary splitting the savings? Well, that one could hurt profits of the insurance industry and major health care providers, so Mr. Ryan is against it.

MORE:   Dean Baker: It’s Time for Representative Ryan to Man Up.

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April 4, 2011 · 7:42 pm

Robert Reich: Why We Must Raise Taxes on the Rich

As usual, Robert Reich is the voice of reason calling from the wilderness…

It’s tax time. It’s also a time when right-wing Republicans are setting the agenda for massive spending cuts that will hurt most Americans.

Here’s the truth: The only way America can reduce the long-term budget deficit, maintain vital services, protect Social Security and Medicare, invest more in education and infrastructure, and not raise taxes on the working middle class is by raising taxes on the super rich.

Even if we got rid of corporate welfare subsidies for big oil, big agriculture, and big Pharma — even if we cut back on our bloated defense budget — it wouldn’t be nearly enough.

The vast majority of Americans can’t afford to pay more. Despite an economy that’s twice as large as it was thirty years ago, the bottom 90 percent are still stuck in the mud. If they’re employed they’re earning on average only about $280 more a year than thirty years ago, adjusted for inflation. That’s less than a 1 percent gain over more than a third of a century. (Families are doing somewhat better but that’s only because so many families now have to rely on two incomes.)

Yet even as their share of the nation’s total income has withered, the tax burden on the middle has grown. Today’s working and middle-class taxpayers are shelling out a bigger chunk of income in payroll taxes, sales taxes, and property taxes than thirty years ago.

It’s just the opposite for super rich.

The top 1 percent’s share of national income has doubled over the past three decades (from 10 percent in 1981 to well over 20 percent now). The richest one-tenth of 1 percent’s share has tripled. And they’re doing better than ever. According to a new analysis by the Wall Street Journal, total compensation and benefits at publicly-traded Wall Street banks and securities firms hit a record in 2010 — $135 billion. That’s up 5.7 percent from 2009.

Yet, remarkably, taxes on the top have plummeted. From the 1940s until 1980, the top tax income tax rate on the highest earners in America was at least 70 percent. In the 1950s, it was 91 percent. Now it’s 35 percent. Even if you include deductions and credits, the rich are now paying a far lower share of their incomes in taxes than at any time since World War II.

More:  Robert Reich: Why We Must Raise Taxes on the Rich.

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April 4, 2011 · 7:39 pm

Budget Deal Would Give Pentagon Extra Funds In Exchange For Social Program Cuts

As  President Eisenhower said in his farewell address: “Beware the Military Industrial Complex”.

The Defense budget is one of the largest and most bloated parts of the Federal Budget.  The Secretary of Defense has even said they need to cut spending…

But the GOP and their Campaign contributors think otherwise….

The Republicans prefer to cut small, but important social programs that make a real difference in the lives of many poor people, women, children or the elderly, instead of cutting anything from Defense Contractors.

Mind you….this is the best place to find bloated and unnecessary spending that could be cut without hurting our National Defense or anyone but Haliburton and other parasitic contractors….

 

While media attention focuses on the cuts to government spending demanded by House Republicans and broadly accepted by Democrats, the Pentagon is poised to reap billions more in federal funds, according to sources close to the discussions. The confines of the budget negotiations established by the two parties results in a system where every extra dollar going to military spending ends up being offset by a dollar reduction in spending on domestic social programs.

via Budget Deal Would Give Pentagon Extra Funds In Exchange For Social Program Cuts.

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