Why Rs Want to Privatize Social Security

For some time now, Republicans have wanted to privatize Social Security and have used the growing wave of Baby Boomers aging into retirement as a fear factor to try and make changes they want. Republican VP pick Paul Ryan is one of these people and has recommended privitization.

My assumptions when hearing of these plans are that Republicans want to do this because:

1) They fundamentally believe that the government has no role in providing any saftey net to retirees and want to turn the clock back to pre-Great Depresion policy.

2) While doing so, they would make it so that their backers on Wall Street...the big banks and investment firms...benefit by forcing individuals to buy privately managed funds for retirement that lack any of the guarantees and risk reduction that the current Social Security System does.

I am still sure that both of these to thigns are true. However, I saw something online that adds depth to my point #2 that I thought worth sharing...

In 2016, the first of the Baby Boomers MUST begin withdrawing from the retirement accounts. This will begin years of withdrawals by Social Security recipients out of the stock market as, say what you will about the market, Social Security still parks its money on Wall Street in the Social Security Trust Fund. But a Baby Boom run there will leave the banks deficient of captial to make their nut on.

Wall Street bankers know this and that the only way to truly replace those withdrawals is with new money. So the push is on to replace those Baby Boomer withdrawals from the Trust Fund with Generation X, Y, and Millennial deposits of their retirement money in a new, privatized system that would not only infuse them with cash but free them much more than the Trust Fund to "be creative" with the money. Naturally, this would be far, far riskier than the current system.

This makes (evil) sense to me. It explains the real motivation for the push for privatization...the "why" behind my point #2. It's a policy recommendation of convenience. Republicans want to destroy Social Security in the name of their "small government" fantasies, but they're dependant on Wall Street backers to run and win elections. Wall Street knows the Social Security Trust Fund will be depleated, but also knows it has bought some serious access and pull in DC. So, together...the Rs and the Wall Streeters have found something that will help both.

What's scarier is that Democrats - while traditionally the defenders of Social Security - are almost as beholdent to Wall Street as the Republicans are. Will the stick to their guns or cave?

Commence Republican Spin

Several hours now since the Supreme Court handed down its decision upholding the Constitutionality of the nation's healthcare reform law.

I've noted that Republican talking points are concise and consistent:

• This is a tax and represents a HUGE tax hike on Americans - they're saying this because the law was held Constitutional by the Court as they determined that Congress could tax Americans if they did not have health insurance....and thus compelling them to buy insurance. So, taxation is the mechanism that makes the law hold. The law has not changed, but this "tax" interpretation is the one now from the right and you will be hearing A LOT about it over the next few months. 
• The act will actually raise healthcare costs and limit coverage to Americans. This is the typical Republican playbook. Take what your opponent is running on or claims that they make and reverse them. Convince Americans that their "strength" is their weakness. Facts need not be considered. 
• It represents a program we simply cannot afford. So says the party that ran our economy into the ground and manufactured our massive debt when they ran all branches of the government from Jan. 2001 to Jan. 2009. Sorry. Try again. You have zero credibility on this.
• We will move to repeal it legislatively. Now this is a true statement. They will. I suspect we'll see the first try in a few days and then more tries into the election season. And then certainly if the Rs control any amount of Congress or the Presidency come January 2013, they'll try again.

And in the case of Mitt Romney...of course he is saying all these things too...but doing so after supporting and passing a virtual carbon copy of the national law in his state while he was governor. Since that is public knowledge, you can see that Mitt is literally counting on Americans to be short-term-memory morons and just go with whatever he is saying today.

Prediction: Supreme Court Will Overturn Healthcare Law

Here is my prediction on the Supreme Court review of the national health care reform law...

They will overturn it. Or, more specifically, they will overturn portions of it...like the mandate that every individual has to buy insurance...such that the law is effectively negated. And thus will end, before it actually even was enacted (virtually none of the law's provisions have been enacted yet), the nation's most significant attempt at modernizing its health care system and making it more equitable and beneficial for more people. The infant law will be snuffed out in its cradle.

And if that happens? Well, we're back to where we were before the law was passed - a system predicated on earning maximum profit rather than one attempting to use the free market system to provide quality care for the maximum number of people.

Regardless of the outcome, I'll leave the bickering, taughting, celebrating and commiserating to others.

However, I will also point out something very ironic that I read today in an article about the healthcare law debate...

If the Supreme Court rules that the individual legal mandate in the health care law is not consitutional because Congress cannot compel an individual to buy private health insurance products (the law mandates you buy private insurance, not government run insurance), it will be simultaneously negating one of the primary pillars of conservative reform proposals for Social Security - namely, mandating that everyone buy commercial (private) pension funds.

Ooops.

As the article also points out, this does not mean it's likely that the conservative majority on the Supreme Court will suddenly support the health care reform act now because they want to preserve the chances for Social Security privatization in the future. No, it likely just means that those conservative judges will find a way to both call the health care mandate unconstitutional and any future Social Security privatization mandate OK. With a heavy sigh, I have to agree with that assessment.

Oh, and one more irony pointed out...if if Obama and the Democratically led House and Senate had simply enacted a single payer program back in 2009-2010, it would have been beyond constitutional challenge -- because government has an unambiguous power to tax and to use the revenues for public purposes.

Something Not to be Thankful For

I hope you had a great Thanksgiving yesterday.

There are many things to be thankful for. Republican and conservative stewardship of the U.S. economy over the majority of the last 30 years, however, is not one of them.

A must read that provides the calculated distruction conservative economic theory has had on the U.S. economy is here: http://www.rollingstone.com/politics/news/how-the-gop-became-the-party-of-the-rich-20111109

It's a bit of a long article, but well worth you time in my opinion. Besides, you have some extra time on your hands this holiday weekend anyway, right?

Two Points to Consider When Watching Obama's Jobs Speech

As you watch President Obama's "jobs speech" Thursday, or perhaps if you torture yourself by tuning in as pundits tell you what you just heard, here are a few things to keep in mind, at least in my opinion...

Companies need to step up and get back in the game
While government action can and is sometimes necessary to stimulate the economy, the bottom line is that companies create jobs, not government. No, I haven't gone all "supply side" on you, but it is true that companies are the ones who make decisions on the vast majority of hiring - where, how much, for what and when. There's no getting around that. Obama can talk a good game about tax credits or incentives, but if companies don't want to hire...and rather want to sit on their cash...they won't do it.

This is all related to my assertion that, guess what? The jobs ain't coming back. Companies - especially big ones who tend to employ (or used to) a lot of people - have weathered the economic storm and are now getting by without having to hire back costly items such as employees. So they won't.

Nope. Old jobs are not coming back. Forget about it and move on. The hope would be that "something new" comes along to spur growth, offer clear investment and hiring opportunities for companies and help alleviate the unemployment rate...and thus many of our other economic ills.  This is actually the American spirit that has gotten us by in other times. Be it the automobile, the airplane, medical breakthroughs, the space race, computer chips, the Internet...something big has always come along to really boost our economy and usher in new good times. But this isn't happening now. The bubble burst and the ones left holding the money bags are not ready to invest in innovation and new sectors of the economy.

If government can help via stimulus, great. I am for it. But again, it is companies who hire. So, if you are ticked off that companies are not hiring...get mad at them.

We are in a "conservative economy" and have been for quite some time
Without a doubt, you will hear the Rs rebut Obama's recommendations as ineffective, too reliant on "big government," and wrong for the country. And no doubt, those same conservatives will say that what we really need is a big old helping of tax cuts, deregulation and "getting government off our backs" to free up the economy and get it moving again.

But here's the thing...we are already in that type of economy. Huge tax cuts for the wealthy and corporations were enacted 10 years ago and are still in effect. Aggressive deregulation of energy, financial, transportation, housing and other markets has been going on for 20+ years...and got a big boost over the last 10.

And Obama? He has repealed almost exactly none of that.

You think his "big government healthcare plan" is the problem. Nope. Virtually none of it goes into effect until 2014.

Think Obama is the guy responsible for the debt. Wrong again. Our historic and spectacular federal debt was hand delivered to America by Republicans in the short six years between 2001 and 2007 when they ran the White House and both houses of Congress - all on their watch, all in service of the same economic theories they're still talking about today and all while happily raising the debt ceiling without a peep of controversy.

So you see, we ARE IN a carefully and steadily constructed conservative economy. How you liking that?

Put another way, if tax cuts and deregulation are so good for the economy, where are the jobs?

Anyway, a couple things to ponder as you watch or hear about jobs over the next couple/few days.

New Republican "Fixes" for the Economy Are A Sham

Today we see what Republicans in the House have in mind when they talk about cutting the budget deficit.

Why? Because they've floated their outline for budget planning over the next 10 years, and it includes slashing spending by $5 billion, privatizing Medicare and cutting big from Medicaid. However, it also includes exactly $0 tax increases or other revenue sources. So, it's only touching one side of the budget ledger - spending. Story HERE.

You may recall a couple recent posts I wrote about the importance of addressing both sides of the ledger (spending and revenue) as a responsible way to balance the budget HERE and HERE.

Not surprisingly, the "new" ideas from the Republicans are exactly the same as their traditional ideas on economy and government. To me, this proves they are not serious about responsibly reducing the budget deficit and/or they are wholly blind to their addiction to"voodoo economics" of tax cuts for the rich and corporations combined with roll-back of government programs. This approach not only does not work but makes things horribly worse.

As evidence of this claim, I give you the entire history of the United States of America from the 1770s to the 1930s. That's right. Our history is one of boom and bust, boom and bust, boom and bust...all with a relatively small middle class, virtually no government programs or regulation and with wealth concentrated at the top among a very few.

Only in the period roughly between 1934 and the early 1980s did we REALLY break out and grow our middle class and society into the unquestioned economic, cultural, military and standard of living leader of the world. And what do you think was one key differentiation in that 40+ period of time from everything that came before? Responsible government programs and laws - Social Security, Medicare, Medicaid, Civil Rights legislation, regulation of financial markets and banks and others.

None of that stuff existed before 1932 and much of it has been under attack or rolled back since the mid 1980s. Only when government asserted itself responsibly to address the economic disaster of the Great Depression, mobilize the country for World War II and pass Federal civil rights laws did we flourish as a world power with a broad, deep, employed and comfortable middle class the likes of which had not seen by any society before.

Flash forward and back to recent times. Our current budget crisis was created by turning our back on the fundamentals that made us a great nation. Conservative economic theory and leadership over the past 10-12 years has been wickedly efficient of producing wealth for the already rich and big companies, but as it did so it created the massive budget deficits, shrinking middle class, rising unemployment and overall erosion of our society that we see today.

And what to the Republicans propose as of today to fix the problem they created...more of the same thing.

That's why I call "sham" on what they're proposing. It won't work...it never has...and is most likely just a new way to funnel money to corporations or the wealthy. And we know how that always works out for the rest of us.

Republican Playbook: Starve the Beast...the Sequel

The conservative playbook...

• You don't like the Federal government
• You think it should be very small and keep out of the way of, well, pretty much everything.
• You have a lot of reasons for this, mostly related to how much money you think you and your rich connections can make in a massively deregulated economy 
• But, you live in a country that as of the 1930s has decided otherwise - not as much as some countries, but certainly it's the national consensus since the Great Depression that the Federal government has a role to play
• Further, your party has not had a majority in Congress (both houses at the same time) since the 1930s, and you have not had the whole Congress and the Presidency since that long ago too. So, your ability to make change has been limited. See the previous point.
• But, in 1995 you get control of both Houses if Congress and then from 2001 to 2006 you add the Presidency.
• You know that the Federal government runs on money and one way to get it out of the way is to "starve" it...in other words, if you don't fund the Federal government it will not be able to do things.
• In the 1990s, you actually are able to make this happen - literally shutting the Federal government down. But, that backfired because...well, go back to my fourth point above. People didn't like that and you got blamed. Goodbye would-be President Dole.
• In the 2000s, you had a balanced budget with no Federal debt (thanks Bill Clinton for your leadership to get that done), but you still don't like the Federal government, so what are you going to do?
• Oh, how about running up the biggest budget deficit the nation has ever seen and doing so in six years time? Yes, that's what you did when you had the power to do so.
• And you did this knowing that once the debt got so huge that you'd then be able to say that, well, there just has to be cut-backs to make things right. Goodbye Federal government programs and regulation enforcement.
• Sure, you were banking on the American public forgetting that it was your leadership in the 2000s that bankrupted the nation, but that's a bet you are willing to take - especially since you were out of power since 2006 in Congress and since 2008 for the Presidency because you can just blame the incumbents for what you did. Easy.

And that ladies and gentlemen is what we're seeing now. The R majority in the House is demanding budget cuts and reductions in major programs (but not defense) as a bold and shameless attempt to "starve the beast." That's right, drive the nation into unprecedented debt and then use that situation as pretext to cut back on Federal government programs big time to "fix" the problem. And hey, if you and your buddies make a ton of money along the way, great. In your mind, that's all good. That's your America right...I got mine, screw you.

A Little Ammo for Those Pre-Election Conversations

With the election coming up in just under two weeks, many people will be making up their minds how they are going to vote. While most probably are not influencable, there may be some people who are even as late as election day itself.

Look, my feeling is that turning the Federal government back over to the very same people who ran our nation into the ground over the past 10 years - and that's what we're talking about when we ponder a change in leadership in Congress - is exactly the wrong thing to do.

From what I can tell, most Americans have the political attention span of a gnat on speed, so many may not remember that virtually every single one of our economic problems were designed, created, manifested and grew to disaster proportions under leadership of the last administration and under conservative rule of Congress.

If you feel the same way, below are a few tips for conversations you may have between now and election day with people who may be leaning towards voting us back to the stone age, but perhaps haven't put too much thought into it yet.

• Note - if the person you are talking to is firmly convinced, then nothing you say will change his or her mind or make them think any differently than they already do. Ain't gonna happen. You might want to jab a little for fun, but don't expect to change that person's mind.
• Note - if you are a conservative and reading this, I understand if you disagree. You may want to skim this quick (or just ignore it) and then tune into Fox News for your fix.

OK, here are some tips for potential topics that may come up in your political discussions over the next few days...

THEY SAY:
I'm voting for CANDIDATE X from the Tea Party because we just need to clean house in Congress. Throw the bums out. Send a message.

YOU SAY:
Yeah, things are pretty messed up in DC. That's for sure. But you know, just voting for someone to kick others out may not always be the best thing. I mean, you gotta consider who you are voting for as well. Seems like a lot of the Tea Party candidates have some pretty "out there" ideas like getting rid of Social Security and Medicare. And I'm not even going to get into some of the wackier things some of these Tea Party candidates indulge in (dressing up like a Nazi, being homophobic but collecting rent on a gay nightclub). Just saying, but I'd check out the candidates you're voting for more if I were you.

THEY SAY:
Government is too big. We need to reduce it's size and get it off the backs of Americans. That's how I'm voting.

YOU SAY:
If that's how you feel, I can't see how you'd want to vote Republican. The U.S. federal government grew to its largest size ever in terms of spending and number of people employed during the six years when Republicans ran the entire show - President and Congress Do you really want to hand over control of the government back to the people who made it so big?

THEY SAY:
I'm voting for fiscal responsibility. Our budget deficit is going to kill our economy and our childrens' future.

YOU SAY:

Yes, I agree 100 percent. I also agree that getting the budget balanced and back into the black is the right thing to do. I assume then, that you'll be voting Democrat, right? I mean...hey, lets face facts. The record budget deficits we now have are a direct result of Republican leadership over the past decade and longer. Reduced taxes for the wealthy and big business, massive deregulation of markets, free trade policies, along with increased government spending and financing two wars are all key moves made by Republican Congresses and the Bush White House. We're still trying to dig out from that. You want to give them control again? I say no. And hey, guess who led us out of the last debt crisis and into the back - Bill Clinton.

THEY SAY:
I'm voting for the Tea Party because our freedom and liberty are under attack. We need to get those back.
YOU SAY:
I am not sure I understand? The U.S. economy and culture are the freest in the entire world. Just so I know where you're coming from better, what are you now no longer able to do freely that you want back?

THEY SAY:
I'm voting conservative (or Republican or Tea Party) because of (insert moral, religious or "family values" issue here).

YOU SAY:
I can tell you're passionate about this. But, when was the last time a conservative or Republican controlled government actually delivered on your issue - or any moral values issue? Abortion is still legal. We still have firm separation of church and state. Gay marriage is still legal in a number of states and if anything the tide is going towards more of it. Same with assisted suicide. Seems like the Republicans or conservatives use issues like yours to get your vote and then never deliver. You know...they're using you.

NOTE: you are not going to change a person's mind on their moral issue, but you may someone to think twice about voting for the same type of candidates over and over.

THEY SAY:
I am just not seeing the change that I voted for in 2008, so I am not going to vote. It clearly makes no difference.

YOU SAY:
Healthcare reform has been passed, a stimulus to the economy has helped stabilize it and stave off worse unemployment, the auto industry has been saved and we're starting to dial back our presence in Iraq. Sure, there is more to do and no it's not as fast as I'd like either. But, not voting will basically hand the government back over to the very people who wrecked us before. Not a good move in my book.

THEY SAY:
Unemployment is still really high and Obama and Congress have done nothing to fix it.

YOU SAY:
Yeah, I'm disappointed too. But I think it's wrong to blame Obama. I mean, he came into office with high unemployment and an economy just about to go down the tubes. He's done a pretty good job of stabilizing the economy and unemployment rates in under two years.

More important than any of that is the fact that jobs are created by businesses - not the government. To me, it seems like businesses are not innovating to grow - and with it hire people - but rather just finding new ways to lower costs by outsourcing or reducing staff. And, using the recession as an excuse to keep their now lighter employee base small. Maybe it would be good to have a government that encourages domestic innovation and employment.

Healthcare Reform Protester Irony 101

Last week I posted an entry here about the current healthcare debate and the rowdy protesters that are showing up to town halls on the subject.

My approach was to take the healthcare protesters at their word that they're just simple middle class people concerned about what could happen to their insurance and care - not ringers planted by conservative groups against reform. With that in mind, my assertion then was that the people protesting reform of the healthcare system so loudly are the very people who likely need reform of the healthcare system most...and by extension are not part of an admirable rebellion or icons of free speech. They're ignorant at best, used at worst.

And now we have a real life example of this. At one of the more rowdy town halls about reform last week in the St. Louis area, a scuffle broke out between protesters and supporters of reform. In the melee one of the conservative protesters was roughed up enough that he needed to be taken to a hospital for care of his injuries.

Well, guess what? This guy was recently laid off from his job and does not have any healthcare insurance! Hmmm. And what is he doing to try and pay for the services he needed? Asking other people to pay for it! Huh! Yep, he's asking for donations from other people to cover his costs. Check it here.

What happened to "pull yourself up by your bootstraps?" All of a sudden it's OK to ask others to help you out in a time of need? Hmmm. How quickly those conservative ideals of the "rugged individual" disappear when one of them actually needs help. Oh, and there's the little matter that more and more of us will be reduced to begging for charity to cover our healthcare costs if healthcare reform does not pass.

Look, if you can see the many ironies in this situation, you get what I'm saying about ignorance breeding bad decisions and...in the case of healthcare reform...hurting the very people it would help.

And if you do not see the irony in this situation, I suspect you may also think that tax cuts for the rich magically "trickle down" to create a wealthy economy for all classes, that voting for socially conservative politicians somehow saves jobs from being outsourced of deficits to be reduced...or that the Apollo moon landings only ever took place on a sound stage in LA. In other words, you won't be convinced, facts be damned.

And so the circus continues.

Thanks to my buddy Marcus for pointing out the above action to me.

McCain Dusts Off “Socialist” Charge

Yesterday, presidential candidate – and old man – John McCain rolled out that great Republican campaign chestnut...."my opponent is a socialist." McCain raised the issue with the nice little statement, "I don't know if Obama is a socialist," and then proceeded to talk about his opinion that Obama's voting record was "to the left" of liberal Senator Bernie Sanders.

Traditionally, this “boogie man” charge has been a tried and true scare tactic to push everyday Americans to vote against Democrats and, in doing so, voting against their own interests (better healthcare, more affordable education, more jobs, clean environment, etc.) in favor of Republican candidates who serve the interests of corporations and the wealthy. There’s a great book on this subject called What’s The Matter With Kansas? A short read, it’s worth checking out.

Ever since the Russian Revolution in 1917, conservatives and the wealthy in this country have recognized the treat of even a whiff of socialism represents to their established control over the economy and wealth. So, they have aggressively used “Red baiting” in campaigns through the decades. And really, it’s been quite successful. Only when the economy completely collapsed in 1929 and The Great Depression ensued did the public call the conservative bluff and vote into office leaders (Franklin Delano Roosevelt, Democratic Congress) willing to actually create programs for the common good (Social Security, Medicare, the SEC and FDIC are great examples), as well as public works projects to get the country back to work. At the time, FDR was indeed called a communist by conservatives for doing so. Thank goodness he persevered and was not assassinated like another high profile so-called “socialist” Democrat – Huey P. Long of Louisiana.

Ironically, once in office, Republicans are the ones who act as “socialists” by using the public’s collective revenue (your taxes) to deliver spectacular tax breaks, loopholes,, investments, subsidies and trade policy to authorize, aid and abet corporations and the wealthy in their goal of maximum private profit in the shortest period of time.

Given his advanced age, perhaps McCain is so old that the Red baiting worldview is the one he relates to best and, through instinct and default, goes to this Cold War campaign tactic.