Haves, Have Nots, and Have Mores
Awhile back Lambert wrote an article discussing some of the changes that have happened in the American economy since the 1980s, and what graphs might show that change best. Here is a video by Donna D'Souza (AKA Haiku Charlatan) that shows a lot of charts that show exactly that. She also presents a few contrasting quotes from John Maynard Keynes and Alan Greenspan, whom one might call the light and dark sides of modern macroeconomics. Read more about Video: The Myth Of The Great Moderation
Some of the favored children of the economic elite who have a public presence, work hard in their writing and speaking to divert attention from inequality and oligarchy issues by raising the issue of competition between seniors and millennials for “scarce” Federal funds. That's understandable. If millennials develop full consciousness of who, exactly, has been flushing their prospects for a decent life down the toilet, their anger and activism might bring down the system of wealth and economic and social privilege that benefits both their families and the favored themselves in the new America of oligarchy and plutocracy.
Here and here, I evaluated Abby Huntsman's arguments for entitlement “reform,” and, of course, Pete Peterson's son, Michael fights a continuing generational war against seniors in pushing the austerian line of the Peterson Foundation. Now comes Catherine Rampell, who, in a recent column, sets forth the position that seniors haven't paid for their Social Security and Medicare because they “generally receive” more in benefits out of these programs than they pay into them.
I'll reply to all of the main points in Rampell's argument, by quoting liberally and then replying to the points she makes in each quote. She says: Read more about Misdirection: Rampell Views Entitlements Through the Generational War Lens
I’m generally not one to brag or tell others “I told you so” but after reading more and more articles by other bloggers, writers, pundits and commentators over the past 5 years, I should claim to be some sort of clairvoyant.
More and more people have felt over the past 10 years that the U.S. was not just becoming more oligarchical, but was already an outright Oligarchy. My pessimistic view of the nation was finally vindicated.
“Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens” was a report released this year that used extensive policy data collected between 1981 and 2002 to determine the oligarchic state of the US political system. The study stated “…the preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.” Read more about VICTORY LAP – I TOLD YOU SO
The Congressional Progressive Caucus (CPC) recently issued its “Better Off Budget” document as an alternative to the White House/OMB document, and the coming House budget document, a Republican/conservative alternative. The “Better Off Budget” has received enthusiastic evaluations from writers affiliated with the DC progressive community. Richard Eskow's recent treatment is typical and provides other reviews that are laudatory. These “progressives” clearly see the CPC budget as anything but an austerity budget. But is it, or is it not? Read more about Still Not Over: CPC Update
Let's look again at the new populism through the lens provided by Robert Borosage in his recent attempt to tell us what it is about. He says:
The apostles of the new inequality have unrelenting sought to starve the public sector. President Reagan opened the offensive against domestic investments. Perhaps the hinge moment was in the final years of the Clinton administration when the budget went into surplus, and Clinton, the finest public educator of his time, pushed for paying down the national debt rather than making the case for public investment. He left the field open for George W. Bush to give the projected surpluses away in tax cuts skewed to the top end.
The hinge moment wasn't then. It was when he decided, either early in his first term, or even before he took office, to rely on deficit reduction coupled with low interest rates from Alan Greenspan, on the advice of Robert Rubin and Larry Summers, rather than on deficit spending on human capital investments as advocated by Robert Eisner and Robert Reich. Rubin's victory in the internal debates within the Administration was well-known at the time (1993), and set the deficit reduction course that played along with the Fed's bubbles to create the private sector debt-fueled “goldilocks” prosperity, and surpluses of his second term. By the time Clinton faced the choice Borosage refers to, the die had already been cast. It was very unlikely that Clinton would turn away from further Government austerity policy, and turn instead toward investments in infrastructure, public facilities and “human capital.”
But this is a side point, the real focus of this passage is the notion that the Clinton surpluses were good because they created an opportunity for public investment by using those surpluses. The trouble with this, is that it is a point purely about politics and communications which neglects the economic fact that the surpluses of the Clinton's term, as well as his deficit reduction policies, were bad for the US because they reduced or eliminated private sector surpluses causing a growth in private sector debt in Clinton's “goldilocks” economy. Read more about The New Populism Needs to Get This Straight
It now looks like the big media and leaders in both parties are no longer focusing on the Government Shutdown crisis, but are now moving on to the notion that the shutdown is melding with the upcoming probable breaching of the debt limit to create a combined mother of all fiscal crises. Along with this, the media and many politicians, encouraged by the President's standing “strong, strong, strong,” are now directing attention away from whether ObamaCare will be delayed or compromised, to other types of ransom the Administration might pay in return for both re-opening the Government and also providing an increase of an undetermined amount in the debt limit. Meanwhile there are reports that under increasing Wall Street pressure John Boehner is preparing to negotiate with House Democrats and allow a vote to pass a CR and a clean debt limit increase bill, in return for concessions he can take back to his caucus.
TINA does not apply in this case, and the President's choices are not limited to just refusing to negotiate or giving in to ransom demands whether focused on Obamacare, the Keystone Pipeline, entitlement cuts,“tax reform frameworks” or any other measures that give “tea party” Republicans “the respect” they think is due them. By continuing to frame things in this way, the media and politicians in both parties are echoing the Administration's framing of the situation and absolving the President of his share of the blame for the debt limit crisis. They are also preparing the way for a compromise, that will, almost certainly, result in hurtful cuts to Government spending including renewed consideration of "the Great Betrayal," also known as the Grand Bargain, and probably passage of the chained CPI cuts to Social Security over the objections of a large majority of the American people. Read more about Stop “the Great Betrayal:” Kabuki Update
Here are some quoted excerpts in response to Obama’s determination to cut Social Security:
Michael Lind in “How Progressives Blew the Social Security Argument”:
President Obama reportedly is unveiling a budget using the chained CPI inflation measure to cheat elderly Americans out of the benefits they were promised.
incredible things human beings are capable of (in many cases, once their brains are removed it would seem)
Oliver Knox on January 18, 2013 published this in his article in yahoo news “Bidens head to crisis-hit Europe”:
Biden and his wife, Dr. Jill Biden, will travel to Germany, France and Britain, the White House announced.
This will be no pleasure cruise, and it could even be (to paraphrase the vice president) a big frikkin' deal. Those allies have been wrestling with Europe’s profound economic woes, which threaten America's recovery ...
"President Obama will under no circumstances agree to put your retirement at risk by privatizing Social Security, and he will reject any plan that slashes Social Security benefits."—Obama Campaign “Truth Team,” October 6, 2012 Read more about "I Guarantee You. Flat Guarantee You."
I guess I don't understand how federal aid works anymore. It's true, I've been out of the loop for a few years, having other concerns beyond national politics. But my father is dead now, and I can get back to paying attention to what the thieves we call leadership are up to. I'm horrified. It's so much worse than even I had predicted it would be.
Yes, I'm angry. A trusted "friendly" commenter from another blog I regularly read got angry with my "ignorance." Because I was upset to see that $36B was just dropped on one state, without any comparison, any sort of "is this the right use of taxpayer money" etc. Read more about How Would $36B Impact Your State's Economy?
My "Dismal Science" diet comes from a wide variety of sources. As our corrupt national political establishment and discredited media organs begin to focus on post-election Catfood Commission politics, it's instructive to see how different economists read the writing on the wall, and come to a variety of conclusions. In this case I'd like to highlight the observations of Dr. Richard D. Wolff, who appears to come to a similar conclusion to the one I derived in my previous post about how the Grand Bargain is a shell game calculated to drain the public funds for private purposes (The Grandest Bargain Ever, Explained). Read more about Grandest Bargain Ever, a different wrinkle from Economist Richard Wolff