The Harry Potter Alliance and the Hunger Games

Apparently the release of the second Hunger Games movie has become an occasion for hyper-marketing of cosmetics and fast-food sandwiches. This is, to say the least, ironic, considering the anti-capitalist and anti-militarist themes of the Hunger Games trilogy. The Harry Potter Alliance, a group of fans devoted to working for social justice, has come up with a campaign to resist the hyper-marketing.

This very cool tumblr tells more.

Of tar sands and corporate profits.

This is just a quick post in honor of my friend Stefan Warner, who was arrested with seven others at a civil disobedience action near Schoolton, Oklahoma today. Stefan, working as part of the Great Plains Tar Sands Resistance, chained himself to a piece of equipment that is being used to construct part of the Keystone XL pipeline.

The Great Plains Tar Sands Resistance is holding a training camp for activists March 18-22 in the Ponca City area, and encourages people who are interested in working with them to attend.

If this pipeline is constructed, it "could devastate ecosystems and pollute water sources, and would jeopardize public health," according to Friends of the Earth.

According to newsok.com:

Calgary-based TransCanada has proposed a 1,700-mile pipeline, dubbed the Keystone XL, to carry oil derived from tar sands in Alberta to refineries along the Texas Gulf Coast. Although the northern leg of the project has not received federal approval, the company currently is constructing the 485-mile southern portion of the pipeline that will transport oil from storage facilities in Cushing, Okla., to Texas, said TransCanada spokesman David Dodson.

The man who locked himself to the machinery, called a side boom, was removed after he was lowered to the ground and a local fire department used a pair of bolt cutters to free him, Conn said. A spokesman for the environmental group identified the man as Stefan Warner, a youth pastor from Harrah.

For in-depth background about the XL Keystone Pipeline, I recommend Michael Klare's excellent post at CommonDreams.org

The lesser of two evils?

If the Green Party's presidential candidates had been listed on the Oklahoma ballot, I would have voted for Jill Stein and Cheri Honkala.

Given Oklahoma's extremely restrictive ballot access laws, the only two choices I had were Mitt Romney and Barack Obama. Obama is the lesser of two evils by a large margin. Romney demonstrates a complete lack of core integrity, a willingness to shift from progressive to extreme conservative opinions based on whatever is popular at the moment, and an alliance with the most regressive economic and political forces in the United States.

Nevertheless, I wish I'd had the option to vote for Jill Stein today. For one thing, living in the reddest of red states, I know that Oklahoma will go solidly for Romney. Given the reality of the way the Electoral College operates, a vote for anyone else is a protest vote. I would like my protest vote to be for the candidate I prefer.

As Doug Henwood put it in a recent post for The Nation:

...I wish, just once, an endorsement of a Democratic presidential candidate coming from the left would mull over some serious structural issues that are at stake.

There are certain eternally recurrent features of these endorsement editorials, and they are depressing. The shortcomings of this year’s Democrat are acknowledged, only to be dismissed, because this is always the most important election since 1932, or maybe 1860. If the Democrats lose, brownshirts will move into the Oval Office. It will be repression and immiseration at home and aggressive war abroad. Sure, there will be some repression, immiseration and war even if the Dem wins, but see above re dismissal of shortcomings.

The persistence of the pattern is no exaggeration. Here’s something from a 1967 essay by Hal Draper on the imminent 1968 election: “Every time the liberal labor left has made noises about its dissatisfaction with what Washington was trickling through, all the Democrats had to do was bring out the bogy of the Republican right. The lib-labs would then swoon, crying ‘The fascists are coming!’ and vote for the Lesser Evil.”

And what is the consequence of that swoon? Draper’s answer: “the Democrats have learned well that they have the lib-lab vote in their back pocket, and that therefore the forces to be appeased are those forces to the right.” Almost every editorial urging a vote for this year’s Dem will lament the rightward move of our politics without ever considering the contribution of such calls to the process.

In other words, the Democrats will continue to ignore and disrespect the progressive vote, because they've learned that they can get away with it.

I would much prefer to have the opportunity to vote for candidates who actually respect my views.

Censorship or editorial judgment?

Occupy Together has posted on Facebook a controversial TED talk given by venture capitalist Nick Hanauer. Hanauer says it's a mistake to claim that increasing taxes on the rich will interfere with job creation. He calls this "an article of faith for Republicans" that is "seldom challenged by Democrats."

Jobs are not created by rich people or by capitalists, Hanauer argues, but by a "circle-of-life" type of "feedback loop" between consumers and businesses. If ordinary consumers don't have the resources to make purchases, no jobs are created. Capitalists such as himself only hire more workers as a last resort after demand has increased so much that more workers are absolutely necessary. If tax policies adopted in the US since 1980 that favor the rich really worked, "we would be drowning in jobs."

TED originally failed to post Hanauer's talk, as reported by Ezra Klein and GeekWire. A National Journal post said that TED decided Hanauer's lecture was "too partisan." TED curator Chris Anderson insisted that this was not a matter of censorship, but of editorial judgment, then released the Hanauer video so that viewers could judge for themselves.

I thought that Hanauer gave a vivid description of a fairly standard progressive argument about what causes prosperity or unemployment. What do you think?

Who wants an Oklahoma income tax cut?

On Wednesday, the Oklahoma Senate passed a bill to cut the state's income tax to a top rate of 4.9 percent. While this might sound appealing on the surface, it would result in cutting important public services--like healthcare and education. And to get to this lower top rate, deductions and credits for ordinary working people would have to be sacrificed, meaning that rich people would pay lower taxes and poor people would pay higher taxes. Vital public services have already been cut drastically in the wake of the Great Recession.

The Oklahoma Policy Institute has been doing a lot of work on analyzing this issue, and they have a page of links devoted to information about this important topic. This morning, a post on OPI's OKPolicy Blog shows that most of the support comes not from Oklahomans--even business groups are wary of it--but from outside pressure groups. Among these groups (no surprise) is the notorious American Legislative Exchange Council (ALEC):

So where is it coming from? It’s no coincidence that very similar efforts to eliminate the income tax are popping up in Kansas and Missouri. All three campaigns rely heavily on a report by Arthur Laffer, a former Reagan advisor who has dedicated his career to restricting taxes in numerous states. Governor Fallin mentioned Laffer’s numbers in this year’s state of the state speech, though she cited them as coming from Americans for Prosperity, a national lobbying group founded by David and Charles Koch. Most recently, Governor Fallin wrote the introduction for a report by Laffer and others at the American Legislative Exchange Council (ALEC) that ranks states based on how closely they follow ALEC’s economic policy agenda. It’s clear that these national groups have the governor’s ear.

Occupying the super committee

When I turned on the radio this morning, I heard news that Occupy Wall Street is marching on Washington D.C. to support the end of Bush era tax cuts for the wealthiest US citizens. When I checked out their Web site, I saw this this is so.

According to OWS, "On November 23rd, the Congressional Deficit Reduction Super-Committee will meet to decide on whether or not to keep Obama's extension to the Bush tax-cuts - which only benefit the richest 1% of Americans in any kind of significant way." This is actually the deadline for the committee to complete its work--so this is the day on which it would be voting on its entire plan for deficit reduction.

The OWS march will leave today, November 9, and march 20 miles every day:

A major draw for this march is to encourage more people in rural communities to get involved as well as bring spreading the word along the highway. We are hoping people will join the march along the way; whether for an hour, a day, or the full two weeks, we feel its imperative for OWS to be involved in the historical significance of long distance marches to support, promote, and encourage economic and social equality. We will be walking from 9am to to 5pm (banker hours) and will hold nightly GA's and/or discussions at 7pm in each town where we camp. We will be spending two days off at Occupy Philly and Occupy Baltimore. We are hoping a few people from these occupations will join us in the march to the White House and Occupy DC!.

This raises the question, what is the super committee and what is it doing? The committee was created by the August congressional compromise that ended the standoff over raising the national debt. The Economist has a good summary of that standoff and what the super committee does.

The deal, hammered out just days before that deadline, promises $917 billion in spending cuts over the next decade in return for a two-stage increase in the debt ceiling of $900 billion. After that, a 12-member congressional committee, equally composed of Republicans and Democrats, is to find $1.5 trillion in further deficit reductions that Congress must approve by December 23rd, in return for a similar-sized increase in the debt ceiling. If the committee fails to reach agreement or its proposal is rejected, $1.2 trillion in spending cuts will be triggered, drawn equally from domestic spending and defence.

The House and the Senate will both vote on the super committee agreement, if one is reached, but it will be a straight up-or-down vote with no amendments allowed.

In my opinion, the federal deficit and federal debt are much less of a problem than you might believe, based on mainstream news accounts. (Simply explained, the if the government spends more than it takes in any year, this creates a deficit. Deficits accumulating for a number of years create the national debt.) See this analysis, which I posted in May.

Trying to reduce the deficit at this point--that is, reducing the amount of government spending--could prove devastating to our economy as we struggle with chronic high unemployment and increasing poverty.

Over the past 30 years, taxes have been slashed for the wealthiest US citizens and we have wasted money on numerous unnecessary military adventures, such as the ones in Iraq and Afghanistan. During this period of time, when we were mostly governed by right-wing Republicans, the national debt has increased.

Now, conservatives argue for slashing much-needed social programs in order to reduce the deficit and debt. They even insist on attacking Social Security, which has not contributed to the deficit in any way. Conservatives insist on keeping the Bush era tax increases and even want to cut tax rates further--although they express willingness to raise revenue by closing tax loopholes.

Meanwhile, Democrats on the committee seem determined to sell out ordinary people in an attempt to reach a compromise with the Republicans, according to The Nation.

Representative Maxine Waters of California has introduced a bill to repeal the supercommittee, and the $1.2 trillion in cuts it’s mandated to make. She believes the committee is “illegitimate” and “borders on unconstitutional.”

At a breakfast meeting with progressive reporters and bloggers today (October 27), Waters said she knows her bill probably doesn’t have the support to pass right now, but she wants it on the table if the supercommittee deadlocks. “Of course its’s a long shot. But right now people are getting more and more agitated, frustrated and concerned about this supercommittee and not happy that there are those who are saying, including the president, they want even bigger cuts,” Waters said. “So it may fall apart. If it falls apart my bill is there to say ‘kill it.’ ” She added that she’s spoken to several Republicans who are equally unhappy with the supercommittee’s power.

Waters’s frustration is shared by many Democrats in the House, who feel not only shut out from the process by colleagues in the Senate—Baucus is reportedly acting with guidance from Senate majority leader Harry Reid, leaving House minority leader Nancy Pelosi on the sidelines—but are also shocked at the level of cuts to Medicare and Social Security being proposed.

Representative Henry Waxman told Politico today that he has “no stake” in the committee and called it an “outrageous process” that is “not open and transparent.” He said the “things put forward by Democrats…I would never vote for.”

Democrats would like to portray themselves as the party of the 99 percent. There are indeed strong progressive Democrats who are fighting to protect the interests of ordinary working people and the poor.

The Democratic leadership, including President Obama, often seems more interested in making nice with the one percent than in protecting the rest of us. Let's hope that the march of the 99 percent on the nation's capital will encourage them to re-evaluate their position.

Update 11-10-11:  This morning's Progressive Breakfast reports that super committee Democrats continue to lessen their support for maintaining crucial social programs in hopes of reaching a compromise with Republicans.

What about the one percent?

Thanks to Truthout for reposting  this excellent analysis by Mike Konczal of New Deal 2.0. What Konczal shows is the way that income has been redistributed over the past 30 years in a way that favors executives, managers, and stock traders.

     There’s a reason the protests ended up on Wall Street: The top 1% and top 0.1% comprises all the senior bosses and the financial sector.

      One of the best things about Occupy Wall Street is that there is no chatter about Obama or Perry or whatever is the electoral political issue of the day. There are a lot of people rethinking things, discussing, learning, and conceptualizing the kinds of world they want to create. Since so much about inequality is a function of the legal structure known as a “corporation,” I’d encourage you to check out Alex Gourevitch on how the corporate is structured in our laws.

      The paper notes that stock market returns drive much of the manager’s income. This is related to a process of financialization, something JW Mason has done a fantastic job outlining here. The “dominant ethos among managers today is that a business exists only to enrich its shareholders, including, of course, senior managers themselves,” and this is done by paying out more in dividends that is earned in profits. Think of it as our-real-economy-as-ATM-machine, cashing out wealth during the good times and then leaving workers and the rest of the real economy to deal with the aftermath.

In other words, the reason for increasing inequality in our society is not because some people have worked harder or smarter than the rest of us. It's because the very few people with the most wealth also have accumulated the political power to rip off the rest of us.

The advantages of "disunity"

Donnie is smiling because we're taking our
future back.

It's been a busy week for me with work and grad school, and besides that, I went to hear a presentation by Indian feminist activist Pramada Menon at OU on Wednesday night. Given that, I haven't had chance to get back down to the OKC occupation since Tuesday night. According to the Occupy OKC Web site, there was a march on Chase Bank yesterday afternoon and a rally today at noon. I writing this quickly before I head off to that demonstration.

Tuesday night my girlfriend and I went downtown to check out the occupation. As had been true on Monday night, there were about 50 people present, but although there was some overlap, it wasn't the same 50 people. My sense is that this movement is made up of ordinary people with lots of other responsibilities, folks who mostly aren't able to devote all their time to the movement, but who show up when they can. It would be great if the OKC occupiers developed greater coherence and a more focused strategy. For instance, the Occupy OKC Official Facebook page had no clear announcement that there is indeed a rally at Kerr Park today at noon up until an hour or two before the rally. But the fact that this movement is being put on by overworked ordinary people instead of PR professionals helps to explain that.

The other thing that helps to explain some of the lack of a focused message--both in OKC and in the wider Occupy movement--is that it is indeed a movement of the 99 percent of the population that has been increasingly excluded from the nation's prosperity over the past 30 years. And the truth is, the 99 percent don't have complete agreement amongst ourselves about many important issues.

We don't agree about feminism, abortion rights, gay rights, unions, or the environment. We don't agree about whether the XL pipeline is something we should oppose because of its disastrous environmental consequences, or something we should support because it will provide living-wage union jobs, at least for a short period of time. We don't agree about whether we should eliminate the Federal Reserve.

I believe that disagreement is important, and ought to be treated with the greatest respect. Many people are understandably distressed about the polarization and name-calling that has come to dominate political conversation in the US.

One way to change this is the way that the mainstream Democratic party has chosen--the method of defining an arbitrary "middle ground," and telling everyone else to shut up for the sake of "unity." The other way is for ordinary people to actually start talking to each other across the boundaries of our different beliefs, to reach consensus about what we can, to learn to disagree respectfully when we can't.

I believe that this "other way"is what is starting to happen on the streets of the United States under the auspices of the Occupy movement. And I think that's a good thing.

More on Occupy Wall Street

If you missed it, my first post is here.

Betsy Reed at The Nation has an interesting analysis of the march and its supposed lack of demands:

t’s not that the demands being suggested by OWS’s volunteer policy advisors in the blogosphere are not worthy ideas. At a time when we desperately need to rein in financial speculation and change the incentives on Wall Street, a financial transactions tax is a terrific policy proposal. Dean Baker has been talking about it for years. The thing is, we on the left don’t have a scarcity of policy ideas. We are positively bursting with them. Create a housing trust fund! A national infrastructure bank! And, yes, sure, eliminate the carried interest loophole so fat cats don’t get a bigger tax break than working people. (Some even have more radical ideas, which are quite sensible too.) But at best, we get a polite hearing for these ideas, which then fade away or are hopelessly watered down. We simply lack the power to put them into practice.

And in the recent past, even the most smoothly organized, expertly messaged mass demonstrations have not made a whit of difference in this regard. Consider the last big march on Wall Street this past May 12. The coalition behind it was admirably diverse, including unions like the teachers and SEIU’s 1199, as well as local community organizations such as Citizen Action NY, Coalition for the Homeless and Community Voices Heard. The “May 12 Coalition,” which turned out thousands of protesters on the appointed day, presented the Bloomberg administration with a proposal that exhibited great thoughtfulness in its rigor and detail, asking banks like JPMorgan, Bank of America, and Morgan Stanley to take a 20 percent cut in their contracts to handle functions like child support disbursements or income tax remittances for the city. This would have saved $120 million, part of $1.5 billion that could have been extracted from the banking sector to prevent the city from having to slash education and social services, according to the coalition.

I would also like to nominate this song by Bonnie Lockhart as the movement's unofficial anthem:

Occupied

A few weeks ago I started receiving e-mails from organizations who were sponsoring a protest to occupy Wall Street. I deleted these e-mails without paying much attention to them. Don't get me wrong. I'm no fan of the stock market or the financial speculation industry that seems to have eaten the US economy, and I remember how they helped to crash our economy. But I didn't think these protests sounded as if they'd been planned very well, and I couldn't imagine them being effective.

I seem to have been very wrong.

Now, the mainstream and alternative news (and my inbox) seem to be full of news of a movement that has spread across the US in the past two or three weeks. Busy grad student that I am, I am still trying to sort through all of this stuff and make sense of it.

Here is what I've figured out so far.

First, the feminist peace group Code Pink is leading an effort to make sure the demonstrations are inclusive and have a feminist perspective. See this great post on AlterNet by Melanie Butler:

If Week I of Occupy Wall Street was about surviving, Week II has been about finding our voices. This protest is about the 99 percent of people in America who have been on the short end of the economic stick, but it appears the media believes it's 90 percent made up of men. Some of the organizing and facilitation processes we've developed to make our movement inclusive and participatory have proven not to be enough, and we are constantly adapting and regrouping to ensure that everyone's voice in this broad and vibrant coalition is heard.

Via an e-mail from Code Pink, I also found out about Occupy Together. Their Web site says that they're "an unofficial hub for all of the events springing up across the country in solidarity with Occupy Wall St.," and they also have a Facebook page.

Thanks to a link shared by a friend on Facebook, I found out that there is a local Occupy OKC group, which as a Facebook page and a Web site. Their next "general assembly" is scheduled for tomorrow, Friday Oct. 7, at 7 p.m. at Kerr Park in downtown OKC. I'm not sure I'll be able to make this, but it looks interesting.

Obama as the New Nixon?

Paul Krugman has a link to a fascinating and thoughtful post by Bruce Bartlett, a former economic adviser to Ronald Reagan and Treasury Secretary under George H.W. Bush. Bush argues that Barack Obama has been a moderate conservative president who continues the policies of his Republican predecessors--just as Richard Nixon was a moderate liberal who continued and expanded the Great Society programs of Lyndon Johnson.

In the process, Barlett gives a concise and cogent analysis of much of the political and economic history of the United States since the Second World War. For instance:

Liberals initially viewed Bill Clinton the same way conservatives viewed Eisenhower – as a liberator who would reverse the awful policies of his two predecessors. But almost immediately, Clinton decided that deficit reduction would be the first order of business in his administration. His promised middle class tax cut and economic stimulus were abandoned.

By 1995, Clinton was working with Republicans to dismantle welfare. In 1997, he supported a cut in the capital gains tax. As the benefits of his 1993 deficit reduction package took effect, budget deficits disappeared and we had the first significant surpluses in memory. Yet Clinton steadfastly refused to spend any of the flood of revenues coming into the Treasury, hording them like a latter day Midas. In the end, his administration was even more conservative than Eisenhower’s on fiscal policy.

And just as pent-up liberal aspirations exploded in the 1960s with spending for every pet project green lighted, so too the fiscal conservatism of the Clinton years led to an explosion of tax cuts under George W. Bush, who supported every one that came down the pike. The result was the same as it was with Johnson: massive federal deficits and a tanking economy.

Do yourself a favor and read the whole thing.

Sharing the pain to reduce the deficit

Richard Eskow at Campaign for America's Future has a good analysis of Vermont Senator Bernie Sanders "Shared Sacrifice" plan for addressing the federal debt and deficit. As Eskow points out:

The question is whether we reduce the deficit only through spending cuts, or also by raising taxes on the rich. This should be an easy issue for Democrats to stand on ... and run on. A recent New York Times/CBS News poll showed that 72% of of those surveyed agreed that federal taxes should be raised for households making more than $250,000 - including 55% of Republicans. Yet even with the GOP leadership far to the right of the country on this issue, Democrats haven’t taken an unequivocal position.

Who's speaking for this Republican majority (and most everybody else) in Washington? Only Sen. Bernie Sanders, Socialist from Vermont. Sanders has unequivocally said that he won't support a deal to raise the debt ceiling unless it includes higher taxes on on the rich. Where are the Democrats? Nancy Pelosi's been marginalized from the discussions, even though a deal won't be possible without the support of Democrats in Congress. The White House and Harry Reid have refused to take a firm stand.

Sanders has gained lots of positive attention from progressives for his speech on the Senate floor Monday, in which he called for each dollar of cuts in social programs to be matched by a dollar of tax increases on the wealthy and corporations in order to achieve deficit reduction, as well as "significant cuts to unnecessary and wasteful Pentagon spending."

As has been noted in this space, the federal deficit and debt are something of a long-term problem for the United States, but their impact has been greatly exaggerated by Republicans looking for an excuse to  help the wealthy at the expense of ordinary people. CAF has a useful Web page that examines this issue in light of the current controversy. A link on that page leads to a commentary by Dave Johnson that illustrates the dangers of crashing the economy if Democrats cave in to Republican demands in order to raise the debt limit.

Most progressives understand that the deficit is not a serious immediate economic concern in a country that is on the verge of a double-dip recession. Cutting government spending at this point is likely to make the problem worse. But the Republicans are not likely to concede any of this. What Senator Sanders has offered is a practical and principled compromise. If Republicans truly believe that reducing the deficit and debt is the most serious problem facing the country, they need to be willing for the wealthy and the powerful to share the sacrifice necessary to make that possible.

If you would like to add your support to this position, Senator Sanders has started a petition to President Obama to urge him to follow this approach. CAF has a page that allows you to contact your senators and congressperson about this issue. Maybe this time the Republicans have gone too far. Maybe ordinary people will be willing and able to take their country back.

Update: If even a Fox News commentator thinks that US corporations should pay more taxes, maybe there is real hope for this solution. (Hat tip to US Uncut for that link.)

We're not broke

Hat tip to Mike Hall at the AFL-CIO NOW BLOG for posting a link to this eye-opening position paper from the Economic Policy Institute. According to the paper's author, EPI President Larry Mishel

To fully understand the growth trends in income and wealth in recent decades, one must recognize that the growth has been very unequal: households at the top of the scale have seen much faster growth in their incomes and wealth accumulation than have those in the middle or bottom of the distribution. For instance, the top 10% of the income distribution has claimed almost two-thirds of the gains in income since 1979, with the top 1% alone claiming 38.7% of those overall gains. Moreover, the wealth of the median (or ‘typical’) household was lower in 2009 than in 1983, in spite of the 40.3% growth in the average household’s wealth.4 When the median is substantially lower than the average, it indicates very lopsided growth, which has been the case for the past 30 years: there was no growth in wealth for the bottom 80% of households, while those in the top fifth enjoyed a 50% increase.

So if the private sector has grown for the past 30 years (albeit very lopsidedly), and the projections for the next 30 years indicate comparable total income growth for the economy, then what is the story for the public sector?

It is true that all levels of government are facing budget difficulties as a result of falling revenues during the recession. Higher unemployment and depressed economic activity have certainly depressed tax revenues, and past tax cuts at all levels of government have seriously eroded revenues as well. But some policymakers and pundits want to have it both
ways: choke off the revenue stream to governments while slashing budget expenditures. For instance, the current domestic spending cuts proposed by the House of Representatives for this year were smaller than the revenues lost from extending the upper-income Bush tax cuts and the inheritance tax cut legislated last December

In other words, the extremely rich have benefited much more than everybody else from the nation's increase in productivity over the past 30 years. The extremely rich have also enjoyed huge tax cuts. If the rich paid a bit more in taxes, we could afford government programs that help poor and middle-class people. Choosing not to raise taxes on the rich is just that--a choice.

The full EPI report is easy to read and fairly brief. You can see it (and download it) here.

Good news and bad news

Bad news first. The National Partnership for Women and Families reports that the US House has passed a draconian piece of legislation to drastically reduce both public and private insurance for abortion.Among other things, the report says that HR 3 would make permanent the Hyde Amendment prohibition on public abortion funding for poor women and prohibit the District of Columbia from using local funds to pay for abortions. Up until this time, the Hyde Amendment has faced renewal each year.

The good news is that House Republicans seem to have backed off on their plan to privatize Medicare. Thanks to Women's eNews on Twitter for pointing me towards that news item.

A poor standard

Yesterday, the rating agency Standard and Poor's issued a warning about a possible future downgrade of the US government's credit rating. This was meant to underscore the supposedly precarious position our federal debt and deficit put us in. Dave Lindorff at This Can't Be Happening  has a useful analysis of this announcement and the debt situation in general:

At least one economist burst out laughing on hearing about the S&P announcement. “They did what?” exclaimed James Galbraith, a professor of economics at the University of Texas in Austin, who formerly served as executive director of the Congressional Joint Economic Committee. “This is remarkable! It certainly will confirm the suspicions of those who have questioned S&P’s competence after its performance on the mortgage debacle.”

S&P, as well as the other two big ratings firms, all notoriously failed completely to spot the looming disaster of the banking collapse and financial crisis, and famously issued A ratings to mortgage-backed securities that later proved to be virtually worthless paper, as well as to the banks that had loaded up on the financial dreck.

As Galbraith explains it, “US debt consists of bonds issued in US dollars, which I assume the S&P analysts know. How can the US possibly default on its own currency? The obligation is in nominal dollars, which is to say when the bond retires, the US issues a check in dollars to cover it.”

Since the US prints its own currency (or actually just issues electronic payments to create new money) whenever it needs it, as Galbraith puts it, “As long as there is diesel fuel to power up the back-up generators that run the government’s computers, they will have the money to back their own bonds.”

Hat tip to Common Dreams, where I first found this article.

Deficit attention disorder

Over on AlterNet, Joshua Holland calls out President Obama for giving a deficit speech that was long on "flowery talk" and short on substance:

The reality is that while our private profit-driven health-care system is unsustainably expensive, the U.S. spends less on the public sector than almost every other developed country. We're running large deficits because we're maintaining costly military operations in several countries and the federal government collected less tax revenue in 2010 than in any year since 1961.

Progressives will no doubt celebrate Obama's deft dissection of the GOP's budget gimmicks and his full-throated defense of the welfare state. But it was ultimately some thin political gruel with unemployment remaining at 9 percent and the foreclosure crisis continuing unabated. When Obama's on, as he was today, it's easy to forget that our biggest national debate is little more than a distraction from the real issues plaguing our economy.

The big question on my mind is, how much, in the end, will Obama going to cave in to the extreme budget agenda of House Budget Committee Chair Paul Ryan. Dean Baker explains exactly how bad Ryan's budget proposal is. It will "leave the vast majority of future retirees without decent health care by ending Medicare as we know it. According to the Congressional Budget Office (CBO) analysis, most middle-income retirees would have to pay almost half of their income to purchase a Medicare equivalent insurance package by 2030." Baker also notes that:

he ostensible rationale for this attack is the country's huge budget deficit. This is garbage. As all the pundits know, the country has a huge deficit today because the Wall Street boys drove the economy off a cliff. If the government deficit were not propping up the economy, we would be looking at 11 or 12 percent unemployment, rather than 8.9 percent. Spending creates jobs, and at this point, it is not coming from the private sector, so the government must fill the hole.

Over the longer term, the projections of huge deficits are driven by the projected explosion in health care costs. President Obama's health care reform took steps toward constraining these costs, although probably not enough. Remarkably, Ryan's plan abandons these cost control measures, virtually guaranteeing that quality health care becomes unaffordable for all but a small elite.

Finally, former Labor Secretary Robert Reich points out how expanding Medicare could actually lower both health care costs and the federal deficit:

For starters, allow anyone at any age to join Medicare. Medicare’s administrative costs are in the range of 3 percent. That’s well below the 5 to 10 percent costs borne by large companies that self-insure. It’s even further below the administrative costs of companies in the small-group market (amounting to 25 to 27 percent of premiums). And it’s way, way lower than the administrative costs of individual insurance (40 percent). It’s even far below the 11 percent costs of private plans under Medicare Advantage, the current private-insurance option under Medicare.

In addition, allow Medicare – and its poor cousin Medicaid – to use their huge bargaining leverage to negotiate lower rates with hospitals, doctors, and pharmaceutical companies. This would help move health care from a fee-for-the-most-costly-service system into one designed to get the highest-quality outcomes most cheaply.

Estimates of how much would be saved by extending Medicare to cover the entire population range from $58 billion to $400 billion a year. More Americans would get quality health care, and the long-term budget crisis would be sharply reduced.

Last week...

...was not a quiet week in Oklahoma City.

First, populist candidate Ed Shadid defeated bank officer Charlie Swinton in the runoff election for the Ward 2 City Council seat.Doug Dawgz Blog has the complete story.

Then there were the fires out by Spencer. Sadly, several peoples lost homes due to these blazes. Happily, no one got hurt seriously. I have some good friends who live out there who came through okay with their house and outbuildings intact. But it was a stressful and exhausting few days for them.

On Thursday night I took off my eyeglasses, picked up a shovel and a bucket, and did my best to help out by mopping up some hot spots. (I can sort of see without glasses, and fine ash can destroy a pair of plastic lenses very fast.) The shovel did a pretty good job, but I kept wishing for something to cut branches out of my way and something to break apart burning logs. In other words, I kept wishing I had a pulaski. When I described this to my friends afterward, they were baffled. You might have thought I was asking for a mythical contraption like a left-handed smoke shifter. But no, it's a wildland firefighting tool invented by the renowned fire boss Ed Pulaski, whose experiences in the great 1910 fire also brought about worker's compensation insurance. The firefighting tool he invented combines an axe with a grubbing hoe. You can see a picture here.

Being not only a former wildland firefighter, but also a former Girl Scout, I decided I wanted to be prepared for future occasions. After much searching, I was able to find what I needed at a chain home improvement store. They called it a "landscape axe." I would like to hope that this purchase would work to prevent my needing to use this tool in the future--a form of magic sort of like rolling down the car windows to bring on a rain storm. But I'm not optimistic. Maybe one dry spring doesn't prove anything, but I'm thinking this climate change thing is for real.

Below is a photo from back in the day. That's me on the right:

Why federal budget cuts will hurt women most

Katha Pollit of I The Nation explains why women will be hurt the most by proposed cuts to the federal budget. I thought her analysis of the differential treatment by Wisconsin Governor Scott Walker of predominately male and predominately female public employees union was especially insightful:

Governor Scott Walker sparked widespread outrage for limiting the bargaining rights of public sector unions to wages. Less noted was the curious fact that public safety workers—cops, firefighters and security officers—were exempted from his ire. The obvious, cynical reason is that unions representing teachers, nurses and social workers tend to support Democrats, while public safety workers are solid for Republicans. (That also explains why right-wingers like Walker feel free to bash teachers as incompetent, lazy freeloaders but never allude to the well-known romance between cops and doughnuts, let alone their generous retirement packages.) But is it entirely an accident that the workers deemed unworthy of full bargaining rights are overwhelmingly women, engaged in stereotypically female caring work, and that those whose rights are sacrosanct are men? In a statement on the budget, the University of Wisconsin System women’s studies consortium notes that union membership is crucial for a working woman’s advancement: it not only raises her wages by as much as a year of college but improves her chances of having healthcare even more than earning a college degree would have done, and gives her a measure of job security and a voice in the conditions of her work. Apparently Governor Walker thinks only men deserve those things. After all, this is a man who wants to repeal the state law requiring health insurers to cover birth control, eliminate the Title V family planning program, cut funding for sexual assault victims services and even reduce funding for a pregnant women’s smoking cessation program—oh, and eliminate Badgercare, the state healthcare plan, for 55,000 families a bit over the poverty line.

Meanwhile, Dean Baker of the Center for Economic and Policy Research explains some of the other shortcomings of the House Republicans budget cutting plan, which steals from the poor and gives to the rich. And this CEPR report gives a brief but cogent analysis of the budget deficit issue.

Economic Justice 101

I like this post that commondreams.org picked up from the Guardian. Richard D. Wolff, an emeritus economics professor form the University of Massachusetts, Amherst, explains how lower taxes on the ultra-rich have made life worse for the rest of us. For instance:

the richest Americans take the money they don't pay in taxes and invest it in hedge funds and with stockbrokers to make profitable investments. These days, that often means speculating in oil and food, which drives up their prices, undermines economic recovery for the mass of Americans, and produces acute suffering around the globe. Those hedge funds and brokers likewise use part of the money rich people save from taxes to speculate in the US stock markets. That has recently driven stock prices higher: hence, the stock market recovery. And that mostly helps – you guessed it – the richest Americans who own most of the stocks.

The one kind of significant wealth average Americans own, if they own any, is their individual home. And home values remain deeply depressed: no recovery there.

Cutting the taxes on the rich in no way guarantees social benefits from what they may choose to do with their money. Indeed, their choices can worsen economic conditions for the mass of people. These days, that is exactly what they are doing.

The whole post is well worth reading. Professor Wolff also has an interesting web site.

The trouble with Obama's tax deal

The controversy has been bubbling for several days over President Obama's tax cut deal with Congressional Republicans.

As the Los Angeles Times puts it, this deal would "extend the Bush-era tax cuts for all taxpayers, keep jobless benefits flowing for 13 months and continue a series of tax breaks for the middle class." It would also include "a GOP-backed proposal to revamp the estate tax and lower Social Security payroll taxes by 2 percentage points to put more money into workers' pockets."

Listening to Obama defend this deal, I was impressed by his sincerity. I think the man really thinks he would be putting the economy and ordinary working people in danger if he fights the Republicans instead of compromising. But I think he's wrong.

For one thing, as Chuck Collins points out over at AlterNet, this deal tends to further concentrate wealth in the hands of the very richest US citizens, while taking money away from ordinary citizens. For another thing, as The Other 98% point out, we as a nation have a lot better uses for $700 billion than extending a tax break to the very wealthiest citizens. On top of all that, this "compromise" is bad politics for the president. Paul Krugman argues persuasively that this deal makes Obama's re-election in 2012 less likely.

Worst of all, as Dean Baker points out, the temporary two percent cut in Social Security included in the package could actually open the way to a right-wing attack on Social Security:

Democratic officeholders have had difficulty standing behind tax increases for the very richest people in the country. It is difficult to imagine them sticking their necks out for tax increases that will hit low and middle-income workers. In other words, it is very plausible that in the 2012 election, Democrats will feel the need to take the Republican pledge that they will never raise taxes. This means that the reduction in Social Security taxes may not be for just two years, it may be for the indefinite future.

In principle there is nothing wrong with financing a portion of Social Security benefits with money from general revenue. This was in fact the original intention of President Roosevelt when he designed the program. However, the fact is that the program has always been financed exclusively by the Social Security tax that is taken from workers’ wages. This makes the tax regressive, but it has the advantage that workers can quite legitimately say that they have paid for their benefits. This will be to some extent less true if a portion of the funding comes from general revenue rather than payroll taxes. In short, getting funding from general revenue opens a new line of attack on the program.

For all of these reasons, I hope that House Democrats are successful in their attempt to keep this plan from passing without serious renegotiation.