Two More Debt Ceiling Facepalms

1.  If one didn't know any better, one might conclude that our elected officials don't care whatsoever about the American people.  I know it may sound shocking, but I have this sneaking suspicion.  As evidence, I give you this Washington Post-ABC poll which asked people, among other things, if they would oppose or support certain items in an effort to reduce the national debt.  Here's a summary:

Cut spending on Medicaid:  26% support, 72% oppose

Cut military spending:  43% support, 56% oppose

Raising taxes on Americans earning over $250,000 a year:  72% support, 27% oppose

Gradually raising Medicare age from 65 to 67:  46% support, 54% oppose

Changing the way SS benefits are calculated so they increase slower:  42% support, 53% oppose

Raising taxes on oil and gas companies:  59% support, 39% oppose

Means testing Medicare:  61% support, 36% oppose

Removing SS tax income cap currently at $107,000:  66% support, 33% oppose

Raising taxes on hedge fund managers (essentially changing capital gains taxes to income taxes):  64% support, 25% oppose

In sum, Americans support raising taxes on the wealthy and corporations to match recent historical levels and only making very small changes to Medicare, Medicaid, and Social Security (such as means-testing, which I'm okay with) to help fix the national debt problem.  The only quibble I personally have with the majority of Americans is that I think military spending needs to be cut dramatically.

Yet, in the debt ceiling negotiations in Washington the exact opposite is being considered.  Tax increases for the wealthy and corporations are off the table and big changes to Medicare, Medicaid, and Social Security are a near certainty.  Up is down, left is right, sane is insanity, and what the American people want is irrelevant.

2.  The House recently passed their pie-in-the-sky Cut, Cap, and Balance bill.  The bill was so draconian that it had no chance, absolutely zero chance, of passing the Senate or not being vetoed by the President.  It was a waste of time and Harry Reid, bless his soul, called it "some of the worst legislation in the history of this country." the worst piece of legislation every passed by the House.

It worked by first making massive cuts to government spending starting next year and going into the future.  Second, it capped government spending at around 18% of GDP per year and required 2/3 vote in Congress to ever raise taxes.  Third, it required the passage of a balanced budget amendment to the Constitution before the debt ceiling was raised.

All three of those ideas are bad.  The first because the cuts come at the expense of the poor and elderly almost exclusively.  The second because it gives no flexibility to respond to crises like the one from which we are still recovering.  The third because it gives even less flexibility than the second and degrades the beauty of our Constitution.  It would ruin our economy, I have no doubts about that.

It was, then, seen as a way for the please-don't-compare-yourselves-to-the-real-Tea-Party Congresspersons to show their ultra-conservative chops.  It was a political stunt, nothing more and nothing less.  They knew it didn't have a chance for passage because it was so conservative, they knew it was just to satisfy their base.

But the Republicans control the House and it is their right to pass whatever they want.  I think it is a dangerous bill and a waste of time when we are so close to an economic meltdown, but they've earned the right to be irresponsible I guess by winning elections and anyway everyone knew it never had any chance to become law.  So it is not the mere passage of the bill that I consider a facepalm.

What really bothers me is that Utah Democrat Jim Matheson voted for it.  JIM MATHESON VOTED FOR CUT, CAP, AND BALANCE!  Are your *&%#^@ kidding me?  Even all of his Blue Dog Conservative Democrat associates called it a horrible bill just meant to give ultra-conservatives a message vote.  I would rather, much much rather, have a Republican in that seat than Matheson.  He's an embarrassment.  He is the worst Congressperson in the country.  I hope the state legislature redistricts him right out of office, I really do.

The Debt Ceiling Drama Makes Everyone Look Incompetent

The debt ceiling stuff makes me sick to my stomach.  Despite the fact that the warnings about default are clear and dire, our elected leaders seem to be only interested in political showmanship and not actually solving the problem.

On the one hand you have the Republicans who are the party much more responsible for our unwieldy debt, refusing to raise the debt ceiling unless all of their suddenly austere measures are met without any inkling of desire to compromise on any issue.  They are the major cause of the problem, are completely hypocritical about government debt and size now that they believe it is politically advantageous, and are unwilling to negotiate like responsible adults to avoid the catastrophe they precipitated.  They are more interested, it seems, in pleasing their corporate overlords than doing what is right for the American people.  Here is one graph, among many many many, that illustrates the level to which Republicans are at fault for the debt:

From the New York Times

On the other hand you have the Democrats who seem to only care about reelection, not solving problems, caving on almost every issue because they think the more they move to the right the more electable they will become.  Every time they make a move towards a compromise, without anything offered in return, the Republicans pull the chair out from under them and move it a little further to the right.  The Democrats get up, brush themselves off, offer fresh cuts to Social Security or offer trillions in cuts without any increases in revenue (e.g. raising taxes on the wealthy), without any compromises from Republicans in return, and go to sit back down again only to come crashing to the ground as the chair is pulled out from under them yet again.  Too stupid to learn, I guess.

Meanwhile, the public is overwhelmingly in favor of raising taxes on the rich; closing huge tax loopholes for corporations; keeping Social Security, Medicare, and Medicaid intact; and raising the debt ceiling to avoid another economic downturn.  Somehow the Democrats have turned all that into a losing hand and seem destined to weaken the liberal legacy in return for some non-existent political victory.

I am all for big cuts in spending in order to get the debt under control.  I'm all for cutting out some of the enormous amount of fat in government.  But it has to be done responsibly, and that means raising taxes on the rich and corporations and not gutting the social safety net for millions of poor and elderly Americans.  It mostly means doing everything we can to make the economy strong again, which hinges mostly on creating local and sustainable jobs for average Americans and not showering the wealthy and corporations with more tax breaks and kickbacks.

No one wins no matter what happens in the next few days.  What a miserable time to be a political partisan.

Good News Everyone: Corporations Are Doing Great

The economic recovery isn't going so well for Americans.  The unemployment rate is still over nine percent and hiring is actually slowing down again.  Home foreclosures are still occurring at an alarmingly high rate.  Regular people are not doing well.  In short, as the Wall Street Journal notes: "Across a wide range of measures—employment growth, unemployment levels, bank lending, economic output, income growth, home prices and household expectations for financial well-being—the economy's improvement since the recession's end in June 2009 has been the worst, or one of the worst, since the government started tracking these trends after World War II."

In contrast--stark, ugly contrast--corporations are doing great.  Corporate profits are at an all-time high.  Corporations are holding onto a record amount of cash, around $2 trillion.  The GDP is higher now than it was pre-recession, but virtually all increased income was captured as profits by corporations.  Stocks are the highest they've been since the recession began.  Taxes on the wealthiest Americans are at all-time lows.  The Wall Street Journal astutely noted that there is a "dichotomy between corporate performance and the overall health of the economy."

It is time to stop babying corporate America and the ultra-wealthy, and to stop pretending that their successes or failures equate to general success and failure of everyday Americans.  They are not in the business of creating jobs, protecting the environment, or generally improving economy and the lives of regular Americans.  They are in the business of making profits, and that does not necessarily, or even regularly, translate to better lives for regular people.  Our 30 year experiment in supply-side, trickle down economics should now come to an end.

So what sorts of things should we be doing to take our economy back from corporations?  The first is to skew the tension between the pure profit motive and social responsibility way towards the latter.

Greens believe the legal structure of the corporation is obsolete. At present, corporations are designed solely to generate profit. This legal imperative -- profit above all else -- is damaging our country and our planet in countless ways. We must change the legal design of corporations so that they generate profits, but not at the expense of the environment, human rights, public health, workers, or the communities in which the corporation operates.

The practical solution is "federal chartering of corporations that includes comprehensive, strict and enforceable social responsibility requirements."

Second is for our economy to focus more locally:  "Greens support decentralization, and call for a community-based economics whose aim is local prosperity and self-sufficiency."

The overall idea is to shift power from corporations to people, from national or international to local.  This is a more sustainable way to run an economy.  I also really appreciate the focus on self-sufficiency.  One of the important purposes of self-sufficiency is to be able to help other people.  In our civic lives, we are self-sufficient as individuals and families so that we are stable and comfortable, to be sure, but also so that we can help our neighbors and create a self-sufficient community.  Greens care about self-sufficiency and community welfare because they are tied together.  And large, unwieldy corporations play virtually no part in that scheme.

The current painfully slow recovery for average Americans while corporate America and the wealthiest thrive is further evidence that it is time to reevaluate our economic structure.  It is time to demand social responsibility from corporations and time to stop pretending that that "trickle-down" economics is sound policy.