Before the vote on the Boehner/Obama SatanSandwich last week, Blue America announced that no incumbent who voted for it would be eligible for an endorsement this cycle under any circumstances. We also asked the challengers we endorsed to make a public statement explaining why they opposed the deal. Every single one of our challengers made that statement. One House incumbent running for a Senate seat voted for it and although she is still the runaway best candidate in the race in Hawai'i, we took her off our contribution list. Blue America didn't raise money for Obama in 2008 and, after seeing him in action, there was no chance we would ask our donors to contribute to his campaign next year, not that he needed us then or that he will now... not with the gigantic contributions he gets from Wall Street and other financial predators. Yesterday, Nate Silver did a column in the NY Times that seems to indicate Blue America isn't the only one outraged by the congressional betrayal inherent in a vote for the SatanSandwich.
Initial public reaction to the deficit-reducing deal reached by President Obama and Congress is fairly poor. Although there is some variance from survey to survey, on average approval of the deal registers at 38 percent against 49 percent disapproval across four national polls conducted on it so far.
...Of the 63 Republicans running for re-election to the House in districts that the nonpartisan Cook Political Report deems competitive, 56 of them, or 89 percent, voted for the deal.
Democrats have fewer members running in swing districts in the House, simply because they lost so many of them in 2010. Still, among Democrats who are running in competitive races, the tally was 23-to-14 in favor of the bill, whereas the majority of Democrats in safe districts voted against it. ...In the House, members of the liberal Congressional Progressive Caucus overwhelmingly voted against the bill, with 56 of the 70 members voted opposing it, while other Democrats voted for the bill by roughly a 2-1 margin. A 32-to-28 majority of Republicans in the Tea Party Caucus, meanwhile, voted for the bill-- but they were less likely to do so than other Republicans in the House, who approved the bill by a 72-to-19 margin. ... Among Republicans not affiliated with Tea Party, 91 percent of those in competitive districts voted for the bill, while 62 percent of those not running in competitive races did.
...Anti-incumbent sentiment is probably stronger now than at any point since polling began. We don’t know exactly how that is going to play out, and to some extent we are in uncharted territory.
But the polling so far suggests that the risks are particularly acute for Congress-- and even more acute for the Republicans in Congress, who were more likely to vote for the bill and are being assigned more responsibility for it by the public.
Bernie Sanders had a much better idea about how to reduce the federal deficit than the ineffectual gimmicks that make up the SatanSandwich. Take a look:
UPDATE
A little frank Twitter chit chat with the Chairman. Because there are times when nothing will do but tough love-- and this is one of those times:
Some people want to blame Boehner and Cantor. Others say it's McConnell's fault. Or the GOP's or the screwed up political system, or the fault of the out-of-whack social system that's become less and less fair in the last few decades. But I'd say this video get's it just about perfect:
UPDATE: Bernie Sanders
Good someone noticed! "I find it interesting to see S&P so vigilant now in downgrading the U.S. credit rating. Where were they four years ago when they, and other credit rating agencies, helped cause this horrendous recession by providing AAA ratings to worthless sub-prime mortgage securities on behalf of Wall Street investment firms? Where were they last December when Congress and the White House drove up the national debt by $700 billion by extending Bush's tax breaks for the rich?”
Really pathetic to read this on the White House Blog yesterday: Myth: President Obama caved. Even sadder that they're still defending the Satan Sandwich that has caused the stock market to crash. Sadder still is that they took 95 Democrats over the cliff with them. They all based their support for the bill Boehner brags got 98% of what the GOP wanted on the assumption that the mean old Republicans had a gun to their heads and that they would crash the economy. If Obama was a leader or the Democrats had any guts they would have called their bluff or used the 14th Amendment to raise the debt ceiling without giving in the right-wing hostage-taking and terrorism. Instead we get a mealy-mouthed defense of an untenable stand that solves nothing at all and that the markets saw right through, as it fell off a cliff.
Here's Independent Senator Bernie Sanders explaining to CNN airhead Wolf Bintzer why he voted against it and what's really wrong with the deal:
Bernie:
The first round of $917 billion in discretionary cuts over the next 10 years will begin in the 2012 budget. Although nobody can predict exactly what programs will be cut and by how much because those decisions will be made over the coming months and years by the appropriation committees, here’s what working families can look forward to:
· At a time when there are long waiting lists for affordable childcare and Head Start, it is likely that these programs will be significantly cut.
· At a time when the United States is falling further and further behind other countries in the terms of the quality of our education, it is likely that tens of thousands of teachers and school personnel will be laid off.
· At a time when working class families are finding it harder and harder to send their kids to college, it is likely that there will be cutbacks in federal student aid programs.
· At a time when hunger among seniors and children is rising, it is likely that there will be cutbacks in various nutrition programs.
· At a time when 50 million Americans have no health insurance and many of them are utilizing community health centers as their medical homes, it is likely that there will be cuts in primary healthcare.
· At a time when states, cities and towns have already laid off over 500,000 public service employees, it is likely that there will be even more lay-offs in police and fire protection, and large reductions in federal support for roads, bridges, water quality, sewage and public transportation.
Further, there will likely be cuts in home heating assistance, affordable housing, support for family based agriculture, and research in finding cures for cancer and other diseases.
In addition, there will likely be major staffing reductions in agencies which are trying to protect the physical health and economic well-being of our people. It is quite likely that the EPA, which enforces the rules regarding clean water and clean air, will be cut. The SEC, which regulates against the greed and recklessness of Wall Street, will be undermined. It is also very possible that the Social Security Administration, which assures that seniors and the disabled receive the benefits to which they are entitled in a timely manner, will also be cut.
That is just some of what will likely happen as a result of the first $900 billion in cuts in this $2.5 trillion deficit reduction package.
The second phase of this legislation calls for the establishment of a Super Committee composed of 3 Democrats and 3 Republicans from the House and 3 Democrats and 3 Republicans from the Senate. Let's be clear. The mandate for this 12 member Super Committee is to look at EVERY program of the federal government and come up with $1.5 trillion more in savings. This means that, at a time when the Republicans and an increased number of Democrats are calling for major cuts in Social Security, Medicare and Medicaid, all of these programs will be on the chopping block.
If the committee is unable to reach an agreement with a majority vote, there will then be a "sequestration" process which would require $500 billion in cuts to defense spending and $500 billion more in across-the-board cuts to domestic discretionary spending. In that scenario, Social Security, Medicare benefits and Medicaid would be spared, but even more draconian cuts would occur in programs that sustain working families.
Here is the great irony with regard to the deficit reduction process that we have just gone through:
In poll after poll, the American people have made it clear that they believe in shared sacrifice. Instead of putting Social Security, Medicare, Medicaid, education and environmental protection on the chopping block, the American people have said that they believe the best way to reduce the deficit is to end tax breaks for the wealthy, big oil, and Wall Street and take a hard look at military spending. Yet, the budget deal just approved does the exact opposite of what the American people want. The wealthy and large corporations contribute nothing while there will be a major reduction in services for working families and the most vulnerable people in our country.
Enough is enough! The American people must fight back. We need a government which represents all the people, not just the wealthy, campaign contributors and lobbyists. In these tough and discouraging times, despair is not an option. This fight is not just for us, it is for our children and grandchildren and for the environmental survival of the planet.
Every single Blue America-endorsed candidate for Congress has said they would have voted against the Satan Sandwich. Alan Grayson wrote a pledge that was signed by Ed Potosnak (NJ), Nick Ruiz (FL), Ilya Sheyman (IL) and Norman Solomon (CA). Eric Griego (NM) and Chris Donovan put out their own statements with the same points-- these points (Grayson):
We Are Against Any and Every Cut to Social Security, Medicare and Medicaid benefits. Not today, not tomorrow, and not ever. No way, no how. Not on your life, and not on mine, because both your life and my life may depend on it.
N-E-V-E-R.
Norman Solomon, one of the signers sent this message out to voters in northern California yesterday, further reinforcing and explaining his position:
This is a very bad deal and a huge mistake. Instead of capitulating to Republican ideologues in Congress, we should stand our ground on behalf of seniors, children and other vulnerable Americans. All the rhetoric about “shared sacrifice” rings hollow when the vast majority of us are being sacrificed to the benefit of big banks and Wall Street.
There are plenty of sensible and effective ways to reduce the deficit-- including a transaction tax on Wall Street, an end to the Bush tax cuts for the very wealthy and a major reduction in military spending. But the bipartisan dealmakers in Washington are ripping up the social compact and slashing the safety net that’s essential for vast numbers of Americans.
One of the most dangerous aspects of this deal is that it explicitly sets the stage for future actions to undermine Medicare. This scenario is a betrayal that strikes at the heart of precious values, and it’s among many of the current threats to vital social programs. I am committed to defending Social Security and Medicare on the campaign trail and as a member of Congress.
As a progressive Democrat, I will support the president’s policies when he’s right-- and I will oppose his policies when he’s wrong. With this budget deal, he is profoundly wrong.
The people of this congressional district have a right to know how each candidate for Congress would have voted on this budget deal. I would have joined with other progressive House members in voting no.
I often go to sleep watching MSNBC. The other night I turned off the TV right after Ed Schultz's show, where he had Bernie Sanders on as a guest. Bernie's the greatest, a national treasure. We need more like him... desperately. The problem with going to sleep right after the Ed Show is that when I wake up, before I can catch myself, I've tuned into MSNBC's insidious Republican propaganda program, Morning Joe.
Yesterday before I had even fully opened my eyes and gotten out of bed, I was being bombarded by deranged Inside the Beltway consensus. Everyone agreed that America went wrong by passing Social Security and that that has led us down the road to ruin, culminating in Medicare, which must be ended or America is doomed. Thanks, MSNBC! And thanks, Democrats, for not even standing up against this well-planned attack on our country by the Austerity Monster.
Jared Bernstein is one of the few economists the Obama Administration hired for a top-level position who isn't a dedicated Wall Street shill and a class enemy of 95% of America. He didn't last long. His blog, On The Economy is worth following. Thursday he found the Beltway debate unbelievable.
–How could it be that we’re a less than a week out from a totally self-inflicted wound to our already frail economy?
–Why are policy makers spending every waking minute on deficit reduction when jobs are the most immediate problem facing the economy?
–How did a relatively small group of far right activists totally highjack the national debate?
According to Greg Sargent (citing E. J. Dionne), more people are beginning to buy the most insidious arguments about immediate fiscal austerity-- large spending cuts that kick in right away-- leading to growth, even in the light of the current slowdown, which is itself driven in part by the fading of fiscal support.
As I noted last night, the UK is a living example of the damage done by premature contraculation, but you don’t have to look abroad to see the problem. The figure shows how much diminished gov’t spending has shaved off of GDP growth in the past six months. No wonder employment is in a stall, driven by job losses in the public sector.
But those are facts. And facts are not winning. Facts, in fact, are getting crushed. One almost feels embarrassed to raise them in this climate, as if you’re impolitely butting your pointy head into the dream world of the Washington policy debate.
A highly subsidized Big Oil industry's second quarter haul is a staggering $35.4 billion profit, but the Conservative Consensus doesn't factor getting them to share the sacrifice as part of a problem worth addressing-- not like abolishing Medicare.
Yesterday I was talking with Ed Potosnak about the Blue America candidates' commitment-- absolute commitment-- to not just preserving but strengthening Medicare, for a healthier and more equitable society. Monday we're planning to release a statement from all the Blue America candidates. Ed mentioned that his mom was "near tears telling me about how important Medicare is to her, and she's not alone. I have heard a similar impassioned pleas to preserve Medicare from seniors and their families across the district." His opponent, wealthy Republican career politician Leonard Lance, has voted several times to gut Medicare. In fact... every Republican has.
We don't need more politicians like Leonard Lance. We need more political leaders like Bernie Sanders. I know I started this post with him on the Ed Show. At the bottom is a speech he gave on the floor of the Senate this week. It's worth-- really worth-- listening to the whole thing. Here's a painful synopsis for video-haters:
The rich are getting richer, and their effective tax rate is the lowest in modern history. Many corporations are enjoying huge profits and, because of outrageous loopholes, pay nothing in taxes. Among many other absurdities, we lose about $100 billion every year from companies and individuals who stash their wealth in tax havens in the Cayman Islands, Bermuda and other locations.
And yet, the Republicans have been fanatically determined to protect the interests of billionaires and large multi-national corporations so that they do not contribute one penny toward deficit reduction. The Republicans want the entire burden of deficit reduction sacrifice to be placed on the elderly, the sick, children, and working families. That is morally wrong and, in terms of getting us out of this recession, bad economic policy.
Sadly, the Democrats have yielded far, far too much. In December, with the Democrats controlling the White House, the House of Representatives and the Senate they extended Bush's tax breaks for the rich and lowered the tax rates on estates for the very rich. In April, they allowed tens of billions of dollars in cuts to vitally important programs for low- and moderate-income Americans.
And now, we find ourselves debating two plans. The Reid plan, which calls for $2.2 trillion in cuts over a 10-year period, includes $900 billion in cuts (which will be determined later by committees) in education, health care, nutrition, affordable housing, child care and many other programs desperately needed by working families. Appropriately, it calls for meaningful cuts in military spending and ending the wars in Afghanistan and Iraq. The Reid plan does not require the wealthiest people in this country and the largest corporations to pay one nickel in deficit reduction.
The Reid plan is bad. The Boehner plan is much worse. It calls for large cuts in discretionary spending now and demands that this debt-ceiling discussion be revisited next year-- which is totally absurd and which will likely keep the Congress paralyzed.
Lastly, both plans call for a congressional committee to determine future efforts toward deficit reduction. Based on recent committees-- Bowles-Simpson, the Gang of Six, etc.-- I have little doubt that that new committee will call for major cuts in Social Security, Medicare and Medicaid and will ask very little of the wealthy and multi-national corporations.
Meanwhile, while all of this is occurring in Washington the American people have consistently stated, in poll after poll, that they want the wealthy and large corporations to pay their fair share of taxes and they want to protect Social Security, Medicare and Medicaid. For example, a recent Washington Post poll found that 72 percent of the American people believe that Americans earning over $250,000 a year should pay more in taxes.
Given that reality, is there any reason to wonder why the American people are so angry and frustrated with what's going on in Washington?
If the GOP is determined to wage a fanatic class war against the American people, we need stalwart fighters who won't back down on our side to fight back. You will always find them here.
I'm sad to say that my mistrust for our president has grown so rapidly that Tuesday, when he announced he would be supporting Dianne Feinstein's and Jerry Nadler's legislation to repeal DOMA, my first reaction was to look for shady motives. I mean, did he suddenly evolve in one leap and bound? The White House blog:
President Obama is proud to support the Respect for Marriage Act, which has been introduced by Senator Dianne Feinstein and Congressman Jerrold Nadler. This legislation would uphold the principle that the federal government should not deny gay and lesbian couples the same rights and legal protections as straight couples.
The President has long called for a legislative repeal of the so-called Defense of Marriage Act (DOMA), which continues to have a real impact on the lives of real people-- our families, friends and neighbors.
Why the caution? Well, it just happened to be the day that the media reported that Obama was supporting the efforts of the Gang of Six's conservative consensus plan to redefine "shared sacrifice" as meaning more sacrifice from working families and more tax breaks for millionaires and billionaires.
With the deadline for raising the nation’s debt ceiling just 14 days away, Mr. Warner and the other five senators-- three Republicans and three Democrats in all-- appear to have given new life to a grand bargain with President Obama that could reduce the nation’s deficit by about $4 trillion over the next decade.
In an early afternoon news briefing, Mr. Obama called the proposals unveiled by the senators on Tuesday morning “good news” and a “very significant step.”
Senators from both parties appeared optimistic as well. Forty-nine of them, from both parties, attended a briefing by Mr. Warner and his group’s members on Tuesday morning. Mr. Warner said the reaction had been positive.
“You could almost feel a sigh of relief as people said, ‘Oh my gosh, here’s something that we could be for,’” Mr. Warner said.
...Republicans in the House, who have stated their opposition to any tax increases, could continue to balk at the proposals, which raise nearly $1 trillion in new revenue by lowering rates while closing tax loopholes.
Republican members of the “gang” are trying to persuade House members to support the plan, he said. “There are a number of our Republican colleagues who are working hard on this,” Mr. Warner said.
Democrats, too, will need to be brought along to support the idea that entitlement programs like Medicare and Social Security can be modified without sacrificing their basic nature. A deal could be scuttled if Democratic opposition to some of those proposals develops.
My worry was that Obama would toss the idiotic same-sex marriage bone to hysterical and obsessed gays clamoring for the right to imitate unhappy heterosexuals while slipping in the long-cherished conservative dream to open the doors to the dismantling of Social Security and Medicare. Opposing marriage equality is horrifyingly reactionary and unreasonable. No one opposing marriage equality is fit for public office. But using it as a trade-off to wreck Social Security and Medicare is far worse... far, far, far worse.
Bernie Sanders, addressing Vermont wine growers (and others in the nation's most forward-thinking state) on Ed Schultz's show Tuesday night:
Can we trust Obama on the cuts? I'm not sure. Everyone I know says "no." A usually reliable source of mine in the administration asked me to hold my fire and swore that the president will never do anything to harm Social Security. We should know soon enough. Meanwhile, DeSimone and Jenssen have recommended Ruca Malen Kinien cabernet sauvignon 2007 (an Argentine red) that they describe as "Raspberry and dried-fig flavors with just a hint of spice." For a white, he suggests a South Africa Raats Family Wines Cabernet Franc, 2008, which they describe as "black cherry, plum, and earth tones... super with red meat or game." And for bubbly they're in France: Taittinger Brut La Française champagne-- "granny smith apple and brioche flavors," which they say is "ideal on its own or with caviar." If My White House source is correct and Bernie Sanders and Donna Edwards (and Ed Schultz) are wrong, we're all going to need something a lot stronger than the wines. Bernie-- if you need to read it and not just hear it:
In my view, this Gang of Six proposal is a disaster. iI lowers the tax rate very substantially for the wealthy, and it will make devastating-- this is not modification-- devastating cuts in Social Security, Medicare, Medicaid, education, nutrition... you name the program that are struggling, working class in this country desperately needs, it is going to be cut. I would estimate if the Gang of Six proposal were ever to pass-- I will do my best to see that doesn't happen-- it would be absolutely devastating to working families. We have to do everything we can to rally the American people to prevent it. You're giving the Republicans about 90% of what they ever dreamed of.
90%. Is that hyperbole? Exaggeration? Bernie doesn't think so. Speaking about reactionary gang members Tom Coburn (R-OK), Mike Crapo (R-ID) and Saxby Chambliss (R-GA), he maintained that “while I am sure that they did not get everything that they wanted, I think it’s fair to say they won about 80 percent to 90 percent of what they fought for. Despite President Obama’s campaign promise not to cut Social Security benefits, the Gang of Six plan, which he apparently embraced, calls for massive cuts in that vitally important program... Under the Social Security proposal, a new formula for calculating cost-of-living adjustments would cut a typical 75-year-old’s yearly benefits in 10 years by $560. The average 85-year-old would see a $1,000 a year cut in 20 years. Furthermore, the proposal demands that Social Security be solvent for a 75-year period, which could include additional cuts. The proposal also cuts Medicare by $298 billion over 10 years and makes massive cuts to Medicaid."
Sanders said that the president "apparently embraced" this. My source denies it-- 38-dimensional chess, I'm guessing-- and we'll be finding out pretty soon. I'm guessing Obama's reelection bid depends on it. If he doesn't stand up for working families this time, and takes the part of Wall Street and Big Business again, he's toast... one-termer, no matter what kind of walking freak show the GOP puts up against him.
Lawrence O'Donnell doesn't agree. It looks like my friend in the White House has been talking to him too. And he seems pretty sure it's for real. Listen carefully:
The middle class and the working class have sacrificed and sacrificed and sacrificed... up the wazoo. We paid when the greed-driven banksters drove the economy off the cliff and demanded mammoth bailouts-- or else. So shared sacrifice means, or should mean, it's time for the rich and privileged to pay their fair share. But their politicians protect them. Our politicians don't protect us. The GOP would rather let the good faith and credit of the United States government disintegrate than rescind the unsustainable Bush tax cuts-- or should we now face reality and call them the Bush/Obama tax cuts?
There were two important developments Tuesday, both bad. Washington's always problematic Gang problem reared its head as the Conservative Consensus rushed in to take control of the situation. And tthis transpartisan conservative stunt almost looked reasonable-- I suppose that was the idea-- as the House Republicans passed their ridiculous latest gimmick to pass Ryan's kill-Medicare budget, this time on steroids and this time called Cut, Cap & Balance.
Let's start with the Gang problem. Dean Baker, co-director of the Center for Economic and Policy Research got right to the heart of the matter:
The budget plan produced by the Senate’s “Gang of Six” offers the promise of huge tax breaks for some of the wealthiest people in the country, while lowering Social Security benefits for retirees and the disabled. Despite claiming that they will "reform" Social Security on a "separate track, isolated from deficit reduction," the plan includes cuts to Social Security that would be felt in less than six months, as the plan calls for a new inflation formula that will reduce benefits by 0.3 percentage points a year compared with currently scheduled benefits. The plan also calls for a process that is likely to reduce benefits further for future retirees.
The proposed cuts to Social Security are cumulative. This means that after ten years, a beneficiary in her 70s will see a cut of close to 3 percent. After 20 years, the cuts for beneficiaries in their 80s will be close to 6 percent, while the reduction in annual benefits will be close to 9 percent by the time beneficiaries are in their 90s. For a beneficiary in her 90s living on a Social Security income of $15,000, this means a loss of more $1,200 a year in benefits.
The plan also calls for large cuts in tax rates including a targeted top rate of between 23-29 percent, which will be at least partially offset by elimination of tax deductions. For the highest-income people, this is likely to mean a very large reduction in taxes. For example, Jamie Dimon and Lloyd Blankfein, the CEOs of J.P. Morgan and Goldman Sachs, respectively, are both paid close to $20 million a year at present. If this pay is taxed as ordinary income, then they would be paying close to $7.5 million a year in taxes on it after 2012. However, if the top rate is set at 29 percent, they may save as much as $1.9 million a year on their tax bill. If the top tax rate is set at 23 percent then the Gang of Six plan may increase their after-tax income by more than $3 million a year.
It is striking that the Gang of Six chose to respond to the crisis created by the collapse of the housing bubble by developing a plan that will give even more money to top Wall Street executives andtraders. By contrast, the European Union is considering imposing financial speculation taxes to reduce the power of the financial industry and raise more than $40 billion a year in revenue.
"The plan calls for substantial cuts elsewhere in the budget which are likely to cut into the incomes of large segments of the population, especially the sick and the elderly. The cuts it proposes to the military are just over 1.0 percent of projected spending over the next decade.
In short, this is a plan that should be expected to please the wealthy since it will mean large reductions in their tax liability in the decades ahead. On the other hand, most of the rest of the country is likely to feel the effects of lower Social Security, Medicare and Medicaid benefits, in addition to other cuts that are not yet fully specified.
Baker's an economist-- a real one, not like the corporate shills Wall Street provides all our presidents for their economic teams. And Bernie Sanders (I-VT) isn't the kind of politician Wall Street gets behind either. Funny, his perspective Tuesday was very similar to Baker's.
While all of the details from the so-called Gang of Six proposals are not yet clear, what is apparent is that the plan would result in devastating cuts to Social Security, Medicare, Medicaid and many other programs that are of vital importance to working families in this country. Meanwhile, tax rates would be lowered for the wealthiest people and the largest, most profitable corporations.
This is an approach that should be rejected by the American people. At a time when the rich are becoming richer and corporate profits are soaring, at least half of any deficit-reduction package must come from upper income people and profitable corporations. We must also take a hard look at military spending, which has tripled since 1997.
So while Obama seems to be begging CEOs to donate-- in lieu of their refusal to pay their fair share of taxes-- to the public schools that their greed is destroying, the Party of Greed and Selfishness was passing their Cut, Cap & Balance stunt 234-190, almost every single Republican and five disgusting Blue Dogs-- Boren (OK), McIntyre (NC), Matheson (UT), Cooper (TN) and Shuler (NC)-- voting to screw ordinary working families on behalf of their rich campaign donors once again. Real Democrats voted against it... even the just sworn in conservative Janice Hahn. Congressional Progressive Caucus co-chair Raúl Grijalva (D-AZ) stripped GOP intentions bare:
“This terrible plan could cut Medicare and Medicaid to unsustainably low levels and put seniors’ well-being at risk. Anyone who wants to pass it through Congress should remember that more than 70 House Democrats have already pledged their opposition, and more are signing on every day. The letter we sent to Leader Pelosi July 8 vowing to oppose any cuts to Social Security, Medicare or Medicaid as part of these budget negotiations has become a growing wave of House resolve to protect these programs. We’re keeping it open for more signatures, and our Gang of 70-plus has the ‘Gang of Six’ completely outnumbered. Newly minted Rep. Janice Hahn signed on as one of her first official acts as a Congresswoman-- that’s how quickly it’s picking up momentum.
"Republicans have already said they won’t vote for any package, period, because of their opposition to a functional economy. House Democrats hold the key to whatever plan can pass Congress. That’s why the Senate ‘Gang of Six’ proposal is dead on arrival. Instead of toying with ways to slash vital programs in just such a way as to make different budget numbers align on paper, Congress and the White House should follow the path of our People’s Budget: creating jobs, protecting Social Security, Medicare and Medicaid, ending corporate subsidies and millionaire tax giveaways, and ensuring our economy works for everyone rather than a greedy few.”
Hahn (on the right) is the worst kind of Democrat, one who looks at her constituents as career stepping stones
Tuesday night liberals across the country were greatly cheered by the 6 clear cut victories by progressives-- 5 by landslides-- against Scott Walker's fake candidates in Democratic primaries across Wisconsin. What you didn't read-- not at this blog-- was any cheering for Democratic Party hack Janice Hahn, who won-- narrowly-- her election bid for the west L.A. congressional seat vacated by her disreputable and sleazy crony, Blue Dog Jane Harman.
Hahn, a Democrat in an area where her party enjoys an 18-point registration edge, defeated Republican Craig Huey, 54.6% to 45.4%. But she'll need to start campaigning again soon, as next year's primary is less than a year away.
In an interview Wednesday, Hahn, 59, said she was prepared for both the challenges of her new job and the rigors of a looming campaign.
And she immediately set out to reassure conservatives that they have no reason to not support her. Interviewed on KPCC soon after her sad little victory-- in which so many progressives just abstained-- over a lunatic fringe teabagger, Hahn made it clear that she's ready to take part in dismantling the New Deal, the decades long dream of rightists in America. When asked if she would vote to cut Social Security and Medicare in exchange for raising the debt limit she obfuscated and then let slip her willingness to bargain away the lives of America's most vulnerable citizens, the elderly and infirm. "Americans want us to get together and come up with common sense solutions... If compromises need to be made, I will certainly follow the lead of the President."
That's very different from what we're hearing from Democratic candidates trying to appeal to Democratic-- rather than Republican-- voters. In announcing his intention to run for Congress again, Alan Grayson, a stalwart champion of ordinary working families, made an impassioned speech aimed squarely at weenie-Democrats like Hahn.
Washington is now divided between the Meanies and the Weenies; that's the real two party system today... The Meanies want to take Social Security and Medicare away from grandma and grandpa and the Weenies are quite willing to go along with it and "compromise." Well, people need Social Security and Medicare to live and there's no compromise between life and death; there's no middle ground.
Hahn is exactly what the Democratic congressional caucus does not need-- another despicable lobbyist-driven weenie, pulling the caucus inextricably rightward in the direction of her corporate donors. At the same time she was offering to bargain away the lives of American seniors to avaricious Republican nihilists, the Blue America candidates were making it clear they are on the same page as Grayson-- standing and fighting not just to preserve Medicare and Social Security but to expand and strengthen them. I was especially impressed by a statement from central Florida candidate Nick Ruiz, a very different kind of Democrat than the execrable Hahn.
Whatever debt deal is struck between the two prevailing factions will be primarily a pact of collusion. Thoughtless aristocrats win-- at the expense of the majority of Americans who continue with record losses on a variety of levels. Exchanging cap feathers from largely connected paymasters, the political jesters will cartwheel out of Capitol Hill like ‘winners.’
Make no mistake-- both sides aim to deliver austerity down the barrel of a gun to the American people. And for us, it’s not a matter of whether or not any of the current crop of politicians will block it-- they won’t. It will be a matter of undoing what they’ve done in the next cycle. To do that, we will need more than token Democrats.
Will the U.S. default on its payments? Not likely. But if it does, you can bet all of the major financial interests will know it ahead of time and be short every financial instrument that seems set to implode. Robotic traders know many markets are due for a large correction-- what better way to precipitate it than with Grecian spectacle?
You won’t benefit from this-- but many of them will. And it is why we need a Public Trust-- to hedge against the hedgers.
In every sense, Capitol Hill has already defaulted on its people, and by every measure appears to enjoy the prospects of continuing to do so right through 2012 and beyond, notwithstanding exceptions, such as Bernie Sanders (I-VT) et al.
So what is the jigsaw falling into place for us? The New Deal legacy of widening prosperity is in default. Brick by brick, blow by blow, it is being dissembled under the auspices of ‘reform.’ Cutting Social Security, Medicare/Medicaid, unemployment insurance; a paltry minimum wage that remains untethered to the CPI, and thus suppresses all other wages above it by keeping the bottom of the scale, anchored oh so low; a persistently bloated defense budget, rampant tax evasion by patricians and corporations, degradation of the atmosphere and environment, from CO2 levels to worldwide fish stocks-- the corporate hand of fate continues to turn the wheel.
Hoover thought nothing was possible after the Crash of 1929-- FDR everything. What tack would you take? It makes all the difference in the world.
Obama seems to have that Hooverian sense that Hahn can't wait to get behind. Bernie Sanders, an inspiration for every progressive political leader in the country, does not. Sanders, in fact is loudly demanding that Obama keep his campaign promises to protect Social Security and Medicare, promises that helped win him the election against McCain in 2008. This is from a press release from Sander's Senate office:
In a Senate floor speech, Sanders focused on the White House’s newfound interest in Social Security as a target for cuts. “Where does this come from?” Sanders asked. “The president understands that Social Security hasn't contributed one nickel to our deficit. In fact, Social Security has a $2.6 trillion surplus today, can pay out every benefit owed to every eligible American for the next 25 years. Social Security is funded by the payroll tax, not by the U.S. Treasury.”
Sanders noted that during Obama’s campaign for president he made clear he would not cut Social Security: “The American people are sick and tired of candidates who run for office and say one thing and then, after they are elected, do something very different.”
Sanders cited Obama’s statement from Sept. 6, 2008, when he disagreed with suggestions by Sen. John McCain’s campaign to raise the Social Security retirement age and to reduce cost-of-living adjustments. “Let me be clear,” Obama said at the time, “I will not do either.”
Changing how inflation is measured to determine Social Security benefits is one option the White House injected at the eleventh hour as part of the budget negotiations. Switching to a so-called Chained Consumer Price Index results in lower inflation levels than the current formula used to adjust benefits. The result would amount to a significant cut to Social Security benefits for today’s seniors. Beneficiaries who retire at 65 would get $560 a year less when they turn 75 and $1,000 a year less at age 85.
“So, Mr. President, when you ask why the American people are frustrated with politicians, and are increasingly cynical, it has a lot to do with candidates who say one thing and do another thing,” Sanders said. “If you told the American people you're not going to cut Social Security, then don't cut Social Security. Keep your word.”
Contrast Janice Hahn's willingness to compromise away Social Security and Medicare with this speech yesterday by Bernie Sanders (I-VT):
Blue Dog Mike Thompson vs progressive Norman Solomon?
Not every Blue Dog is as bad as Dan Boren, Mike Ross, John Barrow, Jim Costa, Jason Altmire, Collin Peterson and Jim Matheson, the 7 bums who have voted with the GOP more than 65% of the time on crucial roll calls this year. Boren, whose district gave McCain a 66% landslide, has only voted with the Democrats 17% on these crucial roll calls. Normally he just sticks with Boehner and Cantor. California Blue Dog Mike Thompson isn't nearly as bad as Boren or the other 6. He's with the Democrats around 80% of the time. Interestingly, his northern California district was the mirror image of Boren's. Voters there have Obama a 66% landslide against McCain. And under the new redistricting, it looks like Thompson will be running in a district that is made up of the most Democratic parts of his old district plus most of Lynn Woolsey's even more Democratic district in Marin and Sonoma counties. (Woolsey's district gave Obama 76%, one of his best performances anywhere.)
This isn't a district that should be represented by a Blue Dog, even if he's a relatively house-broken one. Mike Thompson's agenda is not even nearly in sync with the progressive voters of the district. He's a middle-of-the-road, corporate-oriented Democrat who has chosen to join and participate in the decidedly anti-working family Blue Dog caucus. And one of the country's most promising progressive leaders, Norman Solomon, is running on a platform to continue and expand the work of retiring Representative Lynn Woolsey, who was often at odds with Thompson on important issues.
Last week, for example, Woolsey co-wrote a letter to Democratic Leader Nancy Pelosi bolstering her stand against trading away Social Security, Medicare and Medicaid to prevent the GOP from driving the U.S. Treasury into default. Norman Solomon told me he would have signed that letter. Mike Thompson, of course, didn't. Nor would he ever be involved in any progressive initiatives. He's a party hack who, at best, goes along to get along. His career is that of a backbencher serving his time before transitioning to K Street. This is as good a time as any for that transition. Here's the letter:
Leader Pelosi,
We write in strong agreement with your unwavering defense of the Democratic programs that form the bedrock of America’s middle and working classes, and which are overwhelmingly popular.
On July 7, you made very clear that “We are not going to balance the budget on the backs of America’s seniors, women and people with disabilities” and that “we do not support cuts in benefits” for vital safety-net programs. We agree completely.
Especially in these tough economic times, we should not be cutting Social Security, Medicare, and Medicaid benefits that millions of our constituents paid into and depend on. Such benefit cuts should be off the table in current debt discussions.
Our Republican colleagues should be embarrassed by their insistence that unless Social Security, Medicare and Medicaid benefits are cut, the nation will default on its debts. Middle-class families have sacrificed enough, and a deal that pushes the American Dream further out of reach, in order to pay for extending tax breaks for the rich and corporations, is simply unacceptable.
We are united as Democrats in saying that it’s time to stand up to the Republican hostage-taking. We will not be forced to vote for a “final agreement” that we do not agree to -- and that the American people do not agree to.
We stand united with you in insisting that benefit cuts for working families, our seniors, children, and people with disabilities must be off the table, and we stand united with you in fighting for millions of Americans who need Democrats to be firmly on their side.
I think most Democrats and independents in Marin, Sonoma and Napa counties would agree with that-- and they deserve a congressman who will stand up and fight for those ideas. Clearly, that is not Mike Thompson. It is, however, Norman Solomon. Norman is committed to joining the Progressive Caucus once he's in Congress, a caucus Lynn Woolsey chaired for many years. He'll be working on legislation there with people like Raul Grijalva, Jerry Nadler, Donna Edwards, Barbara Lee, Keith Ellison and Barney Frank. Thompson has chosen to spend his legislative career with Boren and Matheson and Barrow and working with them on the toxic Blue Dog legislative agenda. The work of progressive fighters like Bernie Sanders is anathema to that crowd. Norman applauded Sander's approach to keeping Social Security safe-- a far different perspective from how the Blue Dog Caucus views it. Bernie:
Social Security cuts under consideration by the White House in deficit-reduction talks would drive 245,000 people into poverty and lower widows’ benefits $1,200 a year by 2050, according to Social Security Administration calculations provided to Sen. Bernie Sanders (I-Vt.).
Changing the way inflation is measured to determine Social Security benefits is one option on the table in high-stakes budget negotiations that resume Sunday at the White House. The so-called Chained Consumer Price Index on average results in a lower inflation levels than the more common formula used to adjust benefits.
“The result would be devastating cuts for millions of American seniors and people with disabilities,” said Sanders. As chairman of the Senate Subcommittee on Primary Health and Aging, Sanders asked the Social Security Administration’s Office of Retirement Policy to calculate the impact on poverty rates and benefits if the revised inflation gauge were to be adopted.
In 2030, according to the report prepared for Sanders, there would be 173,400 more people living in poverty in the United States. The revised formula also would dramatically lower benefits for retirees. Widows would receive almost $70 a month less in benefits, a reduction of $840 a year. People who are 70-79 would receive $49 a month less, a drop of $588 a year. Benefits for those who are 80-89 would drop by $80/month or $960 a year. Benefits for women would fall by 3.5 percent overall while men’s benefits would drop by 2.9 percent.
By 2050, the impact would be much worse. There would be 245,000 more people living in poverty at mid-century. Widows’ benefits would be $1,200 a year less. Those 70-79 would lose $720 a year, and seniors in the 80-89 age bracket would see benefits fall by $1,200 a year. Overall, women would see a 4 percent reduction in benefits while benefits for men would drop 3.4 percent.
As the deficit negotiations were set to resume on Sunday, Sanders emphasized that Social Security has not contributed a dime to the deficit or the national debt. Funded by the payroll tax on workers and employers, Socials Security has a $2.6 trillion surplus and will be able to provide full benefits for every eligible American for the next 25 years.
Sanders called on President Barack Obama to publicly renounce the idea of cutting Social Security as part of any deal to lower deficits. "I am especially disturbed that the president is considering cuts in Social Security after he campaigned against cuts in 2008," Sanders said. "The American people expect the president to keep his word."
And if Norman has to face Thompson, it means he's going to be up against an extremely well-financed Blue Dog, with lots of support from all the worst places. Norman is going to need our help. There is a difference between Democrats who join the Progressive Caucus and Democrats who join the Blue Dog Caucus. It's life and death... for the most vulnerable segments of the population, quite literally. Today Norman put out a press release calling for an all out defense of Social Security:
A day after President Obama urged fellow Democrats to go along with “trimming benefits” for Social Security and other safety-net programs, North Bay congressional candidate Norman Solomon called for “an all-out defense of Social Security.”
Solomon, a progressive Democrat who was elected as an Obama delegate to the 2008 Democratic National Convention, said Tuesday [July 12] that Social Security cuts would be “a tragic mistake, undermining our nation’s best values as well as its future.”
“Our leaders should be fighting to protect seniors, children, the jobless, the disabled and other vulnerable Americans, not throwing Social Security on the table and pulling out knives,” he said.
“I support the efforts by many Democrats in Congress to resist this looming assault on seniors and others who depend on Social Security and Medicare,” Solomon added.
“The idea of cutting Social Security and Medicare is not only a moral outrage-- it is a disastrous approach that would end up costing us dearly in the long run, severely damaging people’s quality of life and escalating healthcare costs,” Solomon said. “This is not how a civilized society solves its budgetary problems.”
Responding to the president’s statement Monday that “I’m prepared to take on significant heat from my party to get something done,” Solomon said: “We need to turn up the heat to protect Social Security.”
“Social Security does not add a penny to the deficit,” he said. “As it is now, the program will be solvent for more than two decades-- and adjustments such as raising the cap on Social Security taxes for well-to-do recipients can easily render it solvent through mid-century and beyond.”
S.1323 is Harry Reid's bill that "expresses the sense of the Senate that any agreement to reduce the budget deficit should require that those earning $1 million or more per year make a more meaningful contribution to the deficit reduction effort." Reid and his colleagues have, perhaps, been shamed by Bernie Sander's relentless work in the area. Bernie, in fact, cosponsored the resolution with Reid. Needless to say, the Republican extremists, lead by teabag phony Jim DeMint moved immediately to filibuster it and prevent a vote. Shockingly most Republicans joined the Democrats and passed a cloture motion to end the filibuster last week. The right-wing filibuster failed 22-74, only one putative Democrat, Nebraska reactionary Ben Nelson, joining the likes of Rand Paul, Pat Toomey, Jim Inhofe, Ron Johnson, Tom Coburn, Dean Heller, Chris Lee, Rob Portman, Marco Rubio, Roy Blunt and the rest of the far right garbage who feel millionaires and billionaires shouldn't pay their fair share of taxes. These are the followers of the fascist ideology first propounded by American pro-Nazi plutocrat Lammont DuPont in a 1942 address to the National Manufacturers Association:
"We will win the war by reducing taxes on corporations, high income brackets, and increasing taxes on lower incomes, by removing unions from any power to tell industry how to produce, how to deal with their employees or anything else, by destroying any and all government agencies that stand in the way of free enterprise."
The far right believed it then and they believe it today. DuPont introduced the far right's freshly minted new religion: so-called "free enterprise." Among the conservative Republicans voting with the Democrats against this creed-- and against the sociopaths in their caucus-- included Miss McConnell, Jeff Sessions, John Cornyn, John McCain, Jon Kyl, John Thune, David "Diapers" Vitter, Pat Roberts and Dan Coats.
Meanwhile over in the House-- run by sociopaths and nihilists-- they have a vote scheduled today that would repeal energy efficiency standards for light bulbs set in 2007 with strong bipartisan support. Republicans no longer support anything that makes sense and will surely vote en masse to take a giant step backwards. The standards the Republicans plan to gut today will save consumers about $100 per family per year, or about $12 billion nationally, when fully implemented. They will also reduce energy demand, avoiding the need for 30 large power plants. The standards will prevent more than 100 million tons of carbon pollution per year-- the equivalent of taking 17 million cars off the road. And the new standards are sparking investment in American jobs-- prompting manufacturers to build new U.S. plants and create new U.S. jobs making more energy efficient lighting technologies. For example, TCP, a bulb maker that traditionally has done all of its manufacturing in China, plans to open its first U.S. plant, in Ohio, where it will make new CFL bulbs. When’s the last time you heard of something like that happening? Does that explain their opposition? Progress is a horrible thing for reactionaries; it always has been-- which is why they are always on the wrong side of history.
Like many people I know, I held my nose in 2008 and voted for Barack Obama, a junior senator with a voting record I kept warning people meant we were electing an untrustworthy conservative. No, not a reactionary and not as untrustworthy or even as conservative as John McCain, but, to be charitable, nothing to write home about. Other than the symbolism of electing an African-American and an intellectual. But, like almost everyone I knew, I was aware we would be getting-- at best-- another spineless, status quo drone like Bill Clinton. As you may have been able to discern from my comments Monday on Frank Rich's New York piece, I have no intention of holding my nose and voting for Obama again. If he can't win in California without my vote, he has no shot whatsoever.
Last year it was strongly suggested Blue America endorse Obama and raise money for him. I laughed-- and then made some changes to the PAC in response. If there was no chance of Blue America asking our contributors for money for Obama in 2008, there's even less of a chance that we'd consider anything like that for 2012 now that he's proven all of our worst fears to be completely founded. In 2007 I explained my reluctance over and over again, like here, discussing environmental reform. Obama, I insisted at the time, was certainly no better than Hillary Clinton.
A consistent and craven compromiser on almost every progressive value or principle he's had to confront since being elected to the Senate (from Republican "tort reform" to legalizing credit card usury), Obama's environmental record has clearly been "one of accommodation to big corporate interests" and "his 'new kind of politics'" is nothing more than a charismatically delivered sham: "the old kind of influence peddling, caution, and smallness that most Democrats [at the grassroots level] reject." His environmental record is nothing Bush Republicans need to fear.
He is the Senate's leading Democratic supporter of "coal to liquid," a technology that can make gasoline out of coal. Only problem: it produces double the global warming pollution that regular old dirty oil does. As if that wasn't bad enough, Obama actually voted for George Bush's energy bill despite more than $27 billion in subsidies for the oil, nuclear and coal industries, its weakening of clean air and water laws, and the fact that it gave electric companies the power to charge consumers high rates while doing almost nothing to tackle global warming or increase consumer protections.
Why is Obama so willing to "trim his sails" so often-- despite the consequences to working and middle class Americans and the environment? It's not just that he apparently believes accommodation-- even of right-wing extremists-- can be both right and politically useful. It's something deeper. In his autobiography, The Audacity of Hope, Obama admits he has a hard time feeling a truly pressing sense of urgency about the great issues of the day.
He's not the leader America so desperately needs to clean up after the worst presidential regime in history, no more than Hillary Clinton is. It's not enough to drive Republicans out of government, even if that is a well-deserved and worthwhile first step. It's just as important to find BETTER Democrats.
That's still what Blue America is dedicated to and what we ask our supporters to help with. And, on top of Obama's all too predictable colossal cave-in-- or worse-- to the Republicans this week, that work takes on an even greater urgency.
President Obama is pressing congressional leaders to consider a far-reaching debt-reduction plan that would force Democrats to accept major changes to Social Security and Medicare in exchange for Republican support for fresh tax revenue.
At a meeting with top House and Senate leaders set for Thursday morning, Obama plans to argue that a rare consensus has emerged about the size and scope of the nation’s budget problems and that policymakers should seize the moment to take dramatic action.
As part of his pitch, Obama is proposing significant reductions in Medicare spending and for the first time is offering to tackle the rising cost of Social Security, according to people in both parties with knowledge of the proposal. The move marks a major shift for the White House and could present a direct challenge to Democratic lawmakers who have vowed to protect health and retirement benefits from the assault on government spending.
“Obviously, there will be some Democrats who don’t believe we need to do entitlement reform. But there seems to be some hunger to do something of some significance,” said a Democratic official familiar with the administration’s thinking. “These moments come along at most once a decade. And it would be a real mistake if we let it pass us by.”
Rather than roughly $2 trillion in savings, the White House is now seeking a plan that would slash more than $4 trillion from annual budget deficits over the next decade, stabilize borrowing, and defuse the biggest budgetary time bombs that are set to explode as the cost of health care rises and the nation’s population ages.
As a liberal, I believe that if Obama comes in and implements a bunch of muddled centrist policies, proposing tax cuts to deal with poverty and an expanded military and entitlement reform along with a weird convoluted health care reform, he will fail because basic liberal ideas like accountability, oversight, and integrity in leadership will not be embedded into our institutions. The rich have left us with a massive bill in the form of an intractable trade deficit, national debt, and oil addiction, and someone's going to pay it. If it's the public instead of the people who ran up the country's credit cards (take a look at the nation's billionaires), it's going to make a lot of people much angrier than they are right now.
This anger will go somewhere; right now anger is going against Bush, but he's out of the picture come 2009, though we can kick his corpse for a few years or so if Democrats act smartly (which they won't). If Obama's centrist policies fail, and he is considered a big government liberal or progressive, the public will reject liberalism and progressivism, as it has for the last forty years. But this will not be a result of disliking progressive ideas, but as a result of believing that bad centrist ideas are progressive ideas.
So, as liberals who believe in a different vision for America than Obama, it's important that Obama's centrist policy sympathies are blamed for what goes wrong when he takes over and screws up the country worse than it is right now, which we'll notice after our honeymoon of hoorays some time after the transition.
Dave Johnson was also quick to realize the danger we were putting Social Security-- and wjat's left of the New Deal-- in by electing a weak, vacillating and basically conservative Barack Obama.
Barack Obama is echoing the right's destructive narrative about Social Security being in crisis. The crisis is that Reagan and then Bush took all the money from the Social Security Trust Fund to use for tax cuts for the rich. (Clinton's surpluses were paying it back, Bush reversed that.) And now the Trust Fund is going to need some of that money back.
The right's line is that this means Social Security is in crisis, is "not going to be there" for the next generation, and "tough choices" are required. The audacity-- they took the money, and now they say this is Social Security's problem, and that we have to fix Social Security! They say this to distract the public from asking for the money back, and to get them to support efforts to privatize the program.
And Barack Obama has joined them in this! Recently an Obama ad reinforced the right's bamboozlement that Social Security is running out of money. speaking on Meet the Press:
Now, we've got 78 million baby boomers that are going to be retiring, and every expert that looks at this problem says "There's going to be a gap, and we're going to have more money going out than we have coming in unless we make some adjustments now." ... I want to make sure that it's there not just for this generation, but for next generations. So that means that we're going to have to make some decisions...
Paul Krugman pleads with him to stop. A few years ago the right tried to go after Social Security and there was:
... a determined defense by progressives in the media, on the blogs, and in Congress beat back one spurious argument after another, while the American people made it clear that they really want a program that guarantees a basic retirement income that doesn't depend on the Dow. And Social Security survived.
All of which makes it just incredible that Barack Obama would make obeisance to fashionable but misguided Social Security crisis-mongering a centerpiece of his campaign.
The American people don't want to see cuts to Medicare and Social Security. They want the rich to pay their fair share and they want tax loopholes for Big Oil and other corporate monsters to be closed. But Obama is playing it like his hand is being forced. It isn't. This is just what he wants. He'll have the Republicans backing him, of course, but which Democrats have the courage to stand up to him? Watch this space.
UPDATE: Can Chris Van Hollen Be Trusted... A Little?
Van Hollen was just on CNN with Ali Velshi claiming Democrats won't vote to balance the budget on the backs of Social Security recipients. Van Hollen is a sneaky, untrustworthy character and if he's what's standing between the New Deal and fascism, we're sunk. Here's most of the transcript:
VELSHI: Do you know anything about the reports the President is prepared to talk about Medicare and Social Security with the Republicans in exchange for their support to raise the debt ceiling?
REP. VAN HOLLEN: Ali, I do not know the details on this. I saw the reports and will hear a lot more from the President around eleven o’clock when he meets with bipartisan group at the White House. I do know that the President has been looking for a comprehensive deal that gets about $4 trillion in deficit reduction. That was along the lines of the proposal from the bipartisan Simpson-Bowles Commission. But with respect to the story that appeared this morning on Social Security I do not know what exactly the President is referring to. And I should be clear that Congressional Democrats are not going to support something that seeks to balance the budget on the backs of Social Security beneficiaries. What we have said is that if the President wants to adopt a separate track, just as Tip O’Neill and Ronald Reagan did in the 1980s, to strengthen Social Security, that’s one thing. But to try and balance the budget on the backs of Social Security beneficiaries would be unacceptable and I’m pretty confident that is not what the President is referring to.
VELSHI: Let's set the stage what here with what kinds of things could you, and Congressional Democrats, with respect to Social Security might support. If we support an increase in the age when you get Social Security for people who are younger at this point so it phases in over some time. Is that the kind of thing we could be talking about?
REP. VAN HOLLEN: I think that would meet with a lot of resistance for this reason. It's easy for people who make a living like you and I do; talking, to retire a little bit later. It’s a lot harder for someone who has been doing back-breaking work. What we could do-- this is something part of the design of the existing system-- you don't take away the option to retire early but if you do retire early you do get a lower benefit over a period of time. That is part of the design in the current system. You could build on that. There are other options that we have discussed, for example, lifting the cap on the payroll tax. That would bring in more revenue, so there are ways to strength Social Security. Obviously, an important issue-- but don’t do that as way to balance the rest of the budget.
VELSHI: Part of the reports coming out that the President would agree to or push for $3 to $4 trillion in cuts over the next ten years. Where do Congressional Democrats stand on that?
REP. VAN HOLLEN: Well, the President's proposal that he laid out just a short time ago at George Washington University called for about a $4 trillion in cuts over 12 years. And while I think you'd find people disagreeing with some of the details, the overall architecture of that proposal is something that certainly I could support because it was a balanced approach. It said we got to close a lot of these corporate tax loopholes. We have to ask the folks at the very top to go back to paying what they did under-- during the Clinton administration. But it also called for significant cuts which we are going to have to do on domestic discretionary spending. But the President was clear that while we make cuts on the domestic side of the ledger we have to look at Pentagon spending and some the bipartisan commission also recommends.
VELSHI: Congressman, you're a leader in the Democratic Party. So, at some point, we know that Republicans have dug in about nothing that looks, smells, or walks like a tax increase or an elimination of a credit. You do have to compromise and you will probably tell me that you and Congressional Democrats have, but the bottom line is what can you do to bring hard line fiscal conservatives over who will not get off of that mantra?
REP. VAN HOLLEN: That is exactly the question I think all of us need to ask and I, frankly, do not have a good answer for you. Because what you've got right now is a dynamic in the Republican Party, especially with the Tea Party movement, that says that we're not going to support closing corporate tax loopholes even for the purpose of deficit reduction. And until the Republican Party is more worried about the deficit than they are about Grover Norquist, and that whole part of their coalition, then we’re going to have a real problem. Now maybe the ice is beginning to break a little bit there. I haven't-- you know, there were some signs yesterday although you have to see it to believe it. I need to see an actual proposal.
Keith Ellison, co-chair of the Congressional Progressive Caucus, may not have the institutional clout Van Hollen does, but he's far more trustworthy and far more a champion of working families. This morning on Morning Joe he defended Social Security in no uncertain terms-- from both sides. He tried to refocus the debate on the central problem that seniors and the poor are being asked to sacrifice greatly while the richest Americans are being protected by congressional Republicans: "Social Security actually is not contributing to the deficit. Social Security loans us money. So at the end of the day, all this discussion about how we’re going to cut Social Security is very distressing to me because Social Security isn’t the problem… This is inequitable and regressive… We’re asking the poorest Americans to sacrifice. When are the wealthiest Americans going to step up and do the patriotic thing, which is to contribute to deal with this budget deficit."
And Elison's co-chairman, Raúl Grijalva (D-AZ), was among over a dozen progressive leaders vowing to oppose cuts to Social Security, Medicare and Medicaid listed as part of any deficit reduction package combined with a proposal to raise the $14.3 trillion debt limit. They signed a letter to Obama that makes the case that “job creation is the most important issue facing the country-- not deficit reduction... [A]ny cuts to Social Security, Medicare and Medicaid should be taken off the table,” the letter said. “Second, revenue increases must be a meaningful part of any agreement.”
Grijalva: “I think we are allowing the conversation to be skewed by the Republican leadership. The demand on these three programs [Social Security, Medicare, Medicaid] is more political than it is fiscal. It’s a political statement they are making. For the president or for the Congress to allow them to make that statement, when there’s no fiscal rationale for it, is something that we can’t support.”
And, over on the Senate side, there's a champion for working families as well, Bernie Sanders: “Let us be clear,” Sanders said. “Social Security has not contributed one nickel to our deficit or our national debt. Social Security is funded by the payroll tax, not the U.S. treasury... I am especially disturbed that the president is considering cuts in Social Security after he campaigned against cuts in 2008." [Obama made his position clear on Sept. 6, 2008, when he said: “John McCain's campaign has suggested that the best answer for the growing pressures on Social Security might be to cut cost of living adjustments or raise the retirement age. Let me be clear: I will not do either,” Obama said.] “The American people expect the president to keep his word,” Sanders said.
Obama isn't the only Democrat supporting Wall Street's dream to end Social Security and privatize Medicare. Predictably, corporate whores Third Way is backing Obama.
"We praise our Founders annually for revolting against royal rule and for creating an exceptionally durable system of self-government. We can wreck that system if we forget our Founders’ purpose of creating a representative form of national authority robust enough to secure the public good."
There are important new pieces to talk about by E. J. Dionne Jr. and Ian Welsh, but for now we'll have to make do with the above teases. All weekend I've been meaning to re-call everyone's attention to two remarkable documents Howie flagged for us from Asia, which directly address the question of our basic democratic values.
There was, first, the "postcard" Arianna Huffington wrote based on her recent visit to Greece, where she observed the remarkable spirit and well of the Greek people, even in the face of the relentless beating down being rained down on them by the greedy oligarchs of the international financial elite; and the speech Vermont Sen. Bernie Sanders delivered last week on the Senate floor, about the betrayal of basic American values by the American branch of that international financial elite, so confident that it can get away with having the tab for its greed and screwing up passed on to the people it screwed.
Here's just a snippet of Arianna:
Given that the Greeks have always been all about connection, expansiveness and intimacy, it's no surprise that social media have combined with the Greek personality to create a perfect storm of expression, engagement and democracy. . . .
Everywhere I went I was stunned by the level of engagement -- it's not just those physically at [Syntagma] Square who are all in. . . . [T]here's a lot of anger and resentment in the square -- most of it very justified -- but there's also an incredible amount of hope, and, considering how hard things are for millions of people in Greece, an incredible lack of cynicism. This isn't just an "anti" protest -- there's a lot of "pro" in it, as well.
And here's a snatch of Bernie:
Mr. President, this is a lot of pain that the Republicans are tossing out while they want to protect their rich and powerful friends. In my view, the president has got to stand tall, take the case to the American people, and hold the Republicans responsible if the debt ceiling is not raised and the repercussions of that.
That, Mr. President, is what's going on in the real world. People fighting to keep their homes from falling into foreclosure; struggling with credit card debt; marriages have been postponed; lives have been derailed; and retirement savings have been raided to pay for college tuition, to keep their businesses afloat, or simply to keep gas in their car and pay their bills. That is what is going on in the real world.
And, Mr. President, while the middle class disappears and poverty is increasing, there is another reality and that is that the gap between the very rich and everyone else is growing wider and wider. The United States now has, by far, the most unequal distribution of wealth and income of any major country on earth. . . .
It's about time that Washington listened to the American people. Let's reduce the deficit. But, let's do it in a fair and responsible way that requires shared sacrifice from the wealthiest Americans and most profitable corporations.
Feynman, I ventured, is a prime candidate for hero status to "anyone who values the quest for truth, especially at a time when a cancerously ferocious ideology has put truth at the top of its hit list, anyone who believes that without that commitment to truth we're pretty much lost as a species." Feel free to skip my sketching to go directly to the Dyson NYRB piece at the above link. He also gives us a better impression than I've previously had of the sort of scientist Feynman was, driven by that same obsessive regard for the discovery of truth, and the sort of person he was (ditto).
In his 6am PT post, Howie returned to a passage from the book that has made such an impression on him, Glen Yeadon's Nazi Hydra in America, which included this:
Fascism is an inherent problem of any economy based on capitalism. . . . Fascism always assumes power in gradual steps. It destroys our rights one at a time until suddenly it blossoms into full-blown fascism, a totalitarian society controlled by the corporate elite.
The question [Prime Minister George Papandreou] is facing is whether any politician remotely associated with the old guard-- however well-intentioned-- can be the one to tap into these resources and build on what has been awakened. Yes, Greece is corrupt, and the problems exist at all levels. It's a place where playing by the rules came to be seen as for suckers only, creating a system of clientelism, in which attaching yourself to a powerful individual or political machine for income was seen as the smart thing to do.
But now people are rushing, quite literally, to reengage in civic life. They want to start fresh and awaken the public good. They want a real democracy again. And my daily interactions with Greeks during my visit were a reminder of the incredible talents and abilities and resources that are being wasted.
Nevertheless, the media's focus is on the shrunken and pinched debate about austerity. . . . In fact, austerity is not the answer even in the purely economic debate. . . .
To (literally) bring this home, Howie needed us to consider a landmark speech made this week in the Senate by Vermont's Bernie Sanders. We rejoin him at this point. -- Ken
SEN. BERNIE SANDERS (I-VT):
"MR. PRESIDENT . . . "
We can't leave out the speech Bernie Sanders (I-VT) made on the Senate floor Monday. Notice the "I" after his name; it isn't a "D."
Mr. President, this is a pivotal moment in the history of our country. In the coming days and weeks, decisions will be made about our national budget that will impact the lives of virtually every American in this country for decades to come.
At a time when the richest people and the largest corporations in our country are doing phenomenally well, and, in many cases, have never had it so good, while the middle class is disappearing and poverty is increasing, it is absolutely imperative that a deficit reduction package not include the disastrous cuts in programs for working families, the elderly, the sick, the children and the poor that the Republicans in Congress, dominated by the extreme right wing, are demanding.
In my view, the President of the United States of America needs to stand with the American people and say to the Republican leadership that enough is enough. No, we will not balance the budget on the backs of working families, the elderly, the sick, the children, and the poor, who have already sacrificed enough in terms of lost jobs, lost wages, lost homes, and lost pensions. Yes, we will demand that millionaires and billionaires and the largest corporations in America contribute to deficit reduction as a matter of shared sacrifice. Yes, we will reduce unnecessary and wasteful spending at the Pentagon. And, no we will not be blackmailed once again by the Republican leadership in Washington, who are threatening to destroy the full faith and credit of the United States government for the first time in our nation's history unless they get everything they want.
Instead of yielding to the incessant, extreme Republican demands, as the President did during last December's tax cut agreement and this year's spending negotiations, the President has got to get out of the beltway and rally the American people who already believe that deficit reduction must be about shared sacrifice.
It is time for the President to stand with the millions who have lost their jobs, homes, and life savings, instead of the millionaires, who in many cases, have never had it so good.
Unless the American people by the millions tell the President not to yield one inch to Republican demands to destroy Medicare and Medicaid, while continuing to provide tax breaks to the wealthy and the powerful, I am afraid that is exactly what will happen.
So, I am asking the American people who may be listening today that if you believe that deficit reduction should be about shared sacrifice, if you believe that it is time for the wealthy and large corporations to pay their fair share, if you believe that we need to reduce unnecessary defense spending, and if you believe that the middle class has already sacrificed enough due to the greed, recklessness and illegal behavior on Wall Street, the President needs to hear your voice, and he needs to hear it now.
Go to my website: sanders.senate.gov and send a letter to the President letting him know that enough is enough! Shared sacrifice means that it's time for the wealthiest Americans and most profitable corporations in America to pay their fair share and contribute to deficit reduction.
Mr. President, as you know, this country faces enormous challenges.
The reality is that the middle class in America today is collapsing and poverty is increasing.
When we talk about the economy, we have got to be aware that the official government statistics are often misleading. For example, while the official unemployment rate is now 9.1%, that number does not include the large numbers of people who have given up looking for work and people who want to work full-time but are working part time.
And, when you take all of those factors into account, the real unemployment rate is nearly 16%.
Further Mr. President, what we also must understand is that tens of millions of Americans are working longer hours for lower wages. The reality is that over the last 10 years, median family income has declined by over $2,500.
As a result of the greed, recklessness and illegal behavior on Wall Street, which caused this terrible recession, millions more have lost their homes, their pensions, and their retirement savings.
Unless we reverse our current economic course our children will have, for the first time in modern American history, a lower standard of living than their parents.
Mr. President, we throw out a lot of numbers around here. But, I think it is important to understand that behind every grim economic statistic are real Americans who cannot find a decent paying job, and are struggling to feed their families, put a roof over their heads or to just stay afloat.
Last year, I asked my constituents in Vermont to share their personal stories with me-- explaining how the recession, which started more than three years ago, has impacted their lives. In a matter of weeks, more than 400 Vermonters responded and I also heard from people throughout the country who are struggling through this terrible recession.
Their messages are clear. People are finding it hard to get jobs or are now working for lower wages than they used to earn. Older workers have depleted their life savings and are worried about what will happen to them when they retire. Young adults in their 20s and 30s are not earning enough to pay down college debt. People of all ages, all walks of life, from each corner of Vermont-- have shared their stories with my office.
Let me just read a few of these letters:
The first is from a 51 year old woman from West Berlin, Vermont who wrote "Dear Mr. Sanders, Don't really know what to say, I could cry. My significant other was out of work for a year, now he works in another state. I've been out of work since April. Our mortgage company wants the house because we can't make the payments. I can't find a job to save my soul that will pay enough to make a difference. How bad does it have to get! My mother went through the Great Depression and here we go again. I figure that I'm going to lose everything soon! I'm a well educated person who can't see through the fog."
A gentlemen in his mid-50's from Orange County, Vermont wrote: "After being unemployed three times since 1999 due to global trade agreements, I now find myself managing a hazardous waste transfer facility that pays about 25% less than what I was making in 1999. My wife's children have moved back in, unemployed. And we are saving very little for retirement. If things don't improve soon we will likely have to work until we die. We consider ourselves lucky that we are employed. Our children's friends tend to show up around meal time. They are skinny. We feed them. This is no recession, it's a modern day depression."
A woman in her late 40s from Westminster, Vermont wrote: "I am a single mom in Vermont, nearly 50. I patch together a full time job making $12 an hour and various painting jobs and still can't afford to get myself out of debt, or make necessary repairs on my home. No other jobs in sight, I apply all the time to no avail. Food and gas bills go up and up, but not my income. I have no retirement at all, can't afford to move, feeling stuck, tired, and hopeless."
And a 26 year old young man from Barre, Vermont wrote: "In 2002, I received a scholarship to Saint Bonaventure University, the first in my family to attend college. Upon graduation in 2006, I was admitted to the Dickinson School of Law at Penn State University, and graduated in 2009 with $150,000 of student debt. In Western New York I could find nothing better than a $10 an hour position stuffing envelopes ... I live in a small studio apartment in Barre without cable or internet ... I have told my family I don't want them to visit because I am ashamed of my surroundings ... My family always told me that an education was the ticket to success, but all my education seems to have done in this landscape is make it impossible to pull myself out of debt and begin a successful career."
Mr. President, just over the last two weeks, nearly 500 people from Vermont and throughout the U.S. have written me about their experiences with trying-- often in vain-- to find affordable dental care. One wrote: "I can't afford health insurance so dental work is definitely out. I agree [that] ... we are so backward in this country, even though studies have linked bad dental care to heart problems and cancer."
Mr. President, when the Republicans are talking about trillions of dollars in savage cuts, this is what they are talking about. They're talking about throwing millions and millions of people off of Medicaid. Let me tell you what that means.
Earlier this year Arizona passed budget cuts that took patients off its transplant list. As a result people who were kicked off the list have died. Not because they couldn't find a donor but because the state decided it could no longer afford to pay for their transplants. To make matters worse Arizona's governor has gone further, asking the federal government for a waiver to kick off another 250,000 from its Medicaid program.
They're talking about making it impossible for working class families to send their kids to college. They're talking about cuts in nutrition programs which will increase the amount of hunger in America, which is already at an all time high. According to a 2009 study, there are over 5 million seniors who face the threat of hunger, almost 3 million seniors who are at risk of going hungry, and almost 1 million seniors who do go hungry because they cannot afford to buy food. The Republicans in Congress would make this situation much, much worse.
Mr. President, this is a lot of pain that the Republicans are tossing out while they want to protect their rich and powerful friends. In my view, the president has got to stand tall, take the case to the American people, and hold the Republicans responsible if the debt ceiling is not raised and the repercussions of that.
That, Mr. President, is what's going on in the real world. People fighting to keep their homes from falling into foreclosure; struggling with credit card debt; marriages have been postponed; lives have been derailed; and retirement savings have been raided to pay for college tuition, to keep their businesses afloat, or simply to keep gas in their car and pay their bills. That is what is going on in the real world.
And, Mr. President, while the middle class disappears and poverty is increasing, there is another reality and that is that the gap between the very rich and everyone else is growing wider and wider. The United States now has, by far, the most unequal distribution of wealth and income of any major country on earth.
Today, the top one percent earns over 20 percent of all income in this country, which is more than the bottom 50 percent earns. Over a recent 25 year period, 80 percent of all new income went to the top one percent. In terms of the distribution of wealth, as hard as it may be to believe, the richest 400 Americans own more wealth than the bottom 150 million Americans.
The rich get richer, the poor get poorer, and the middle class continues to disappear. That is what is going on in this country in the year 2011, and we have all got to understand that.
Mr. President, everybody knows this country faces a major deficit crisis and we have a national debt of over $14 trillion. What has not been widely discussed, however, is how we got into this situation in the first place. A huge deficit and huge national debt did not happen by accident. It did not happen overnight. It happened, in fact, as a result of a number of policy decisions made over the last decade and votes that were cast right here on the floor of the Senate and in the House.
Let's never forget, as we talk about the deficit situation, that in January of 2001, when President Clinton left office, this country had an annual federal budget surplus of $236 billion with projected budget surpluses as far as the eye could see. That was when Clinton left office.
What has happened in the ensuing years? How did we go from huge projected surpluses into horrendous debt? The answer, frankly, is not complicated. The CBO has documented it. There was an interesting article on the front page of the Washington Post on April 30, talking about it as well. Here is what happened.
When we spend over $1 trillion on wars in Afghanistan and Iraq and choose not to pay for those wars, we run up a deficit. When we provide over $700 billion in tax breaks to the wealthiest people in this country and choose not to pay for those tax breaks, we run up a deficit. When we pass a Medicare Part D prescription drug program written by the drug companies and the insurance companies that does not allow Medicare to negotiate prescription drug prices and ends up costing us far more than it should-- $400 billion over a 10-year period-- and we don't pay for that, we run up the deficit. When we double military spending since 1997, not including the wars in Afghanistan and Iraq, and we don't pay for that, we drive up the deficit.
Further, Mr. President, the deficit was also driven up by the greed, recklessness and illegal behavior on Wall Street, which caused the worst economic crisis since the Great Depression. Millions of Americans lost their jobs and revenue was significantly reduced as a result.
Mr. President, the end result of all of these unpaid-for policies and actions-- year after year of the deficits I just described-- is a staggering amount of debt. When President Bush left office, President Obama inherited an annual deficit of $1.3 trillion with deficits as far as the eye could see, and the national debt more than doubled from when President Bush took office.
The reality is, Mr. President, if we did not go to war in Iraq, if we did not pass huge tax breaks for millionaires and billionaires, who didn't need them, if we did not pass a prescription drug program with no cost control written by the drug and insurance companies, and if we did not deregulate Wall Street, we would not be in the fiscal mess that we find ourselves in today. It really is that simple.
In other words, the only reason we have to increase our nation's debt ceiling today is that we are forced to pay the bills that the Republican leadership in Congress and President Bush racked up.
Now, Mr. President, given the decline in the middle class, given the increase in poverty, and given the fact that the wealthy and large corporations have never had it so good, Americans may find it strange that the Republicans in Washington would use this opportunity to make savage cuts to Medicare, Medicaid, education, nutrition assistance, and other lifesaving programs, while pushing for even more tax breaks for the wealthy and large corporations.
Unfortunately, it is not strange. It is part of their ideology. Republicans in Washington have never believed in Medicare, Medicaid, federal assistance in education, or providing any direct government assistance to those in need. They have always believed that tax breaks for the wealthy and the powerful would somehow miraculously trickle down to every American, despite all history and evidence to the contrary. So, in that sense, it is not strange at all that they would use the deficit crisis we are now in as an opportunity to balance the budget on the backs of working families, the elderly, the sick, the children and the poor, and work to dismantle every single successful government program that was ever created.
And, that's exactly what the Ryan Republican budget that was passed in the House of Representatives earlier this year-- and supported by the vast majority Republicans here in the Senate just last month-- would do. Here are just a few examples:
The Republican budget passed by the House this year would end Medicare as we know it within 10 years.
The non-partisan CBO estimates that under the Ryan proposal, in 2022, a private health care plan for a 65-year-old equivalent to Medicare coverage would cost about $20,500, yet the Republican budget would provide a voucher for only $8,000 of those premiums. Seniors would be on their own to pay the remaining $12,500-- a full 61% of the total. How many of the 20 million near-elderly Americans who are now ages 50-54 will be able to afford that? This approach would transfer control of Medicare to insurers and there would be no guaranteed benefits, essentially ending Medicare as we know it.
The Republican budget would force 4 million seniors in this country to pay $3,500 more, on average, for their prescription drugs by re-opening the Medicare Part D donut hole.
Under the Republican budget, nearly 2 million children would lose their health insurance over the next 5 years by cuts to the Children's Health Insurance Program, according to the Congressional Budget Office.
At a time when 50 million Americans have no health insurance, the Republican budget would cut Medicaid by over $770 billion, causing millions of Americans to lose their health insurance and cutting nursing home assistance in half - threatening the long-term care of some 10 million senior citizens.
The Republican budget would completely repeal the Affordable Health Care Act preventing an estimated 34 million uninsured Americans from getting the health insurance they need.
At a time when the cost of a college education is becoming out of reach for millions of Americans, the Republican budget would slash college Pell grants by about 60% next year alone - reducing the maximum award from $5,550 to about $2,100.
At a time when over 40 million Americans don't have enough money to feed themselves or their families, the Republican budget would kick up to 10 million Americans off Food Stamps, by slashing this program by more than $125 billion over the next decade.
At a time when our nation's infrastructure is crumbling, the Republican budget passed in the House and supported by all but a handful of Republicans here in the Senate would slash funding for our roads, bridges, rail lines, transit systems, and airports by nearly 40 percent next year alone.
Yet despite the fact that military spending has nearly tripled since 1997, the House Republican budget does nothing to reduce unnecessary defense spending. In fact, defense spending would go up by $26 billion next year alone under the Republican plan.
Interestingly enough, at a time when the rich are becoming richer, when the effective tax rates for the wealthiest people, at 18 percent, are about the lowest on record, at a time when the wealthiest people have received hundreds of billions of dollars in tax breaks, at a time when corporate profits are at an all-time high and major corporations making billions of dollars pay nothing in taxes, my Republican colleagues, in their approach toward deficit reduction, do not ask the wealthiest people or the largest corporations to contribute one penny more for deficit reduction.
In fact, the Republican budget would keep the good times rolling for those who are already doing phenomenally well - it provides over $1 trillion in tax cuts to millionaires and billionaires by permanently extending all of the Bush income tax cuts; reducing the estate tax for multi-millionaires and billionaires; and lowering the top individual and corporate income tax rate from 35 to 25 percent.
Mr. President, the Republican idea of moving toward a balanced budget is to go after the middle-class, working families, and low-income people, and to make sure the millionaires and billionaires and largest corporations in this country that are doing phenomenally well do not have to share in the sacrifices being made by everybody else. They will be protected. The Republican approach to deficit reduction in Washington is the Robin Hood philosophy in reverse: taking from the poor and giving to the rich.
And it's not as if it's good for our economy. Mark Zandi, the former economic advisor to John McCain when he was running for president, has estimated that the Republican budget plan will cost 1.7 million jobs by the year 2014, with 900,000 jobs lost next year alone.
The House Republican budget is breathtaking in its degree of cruelty.
But, don't take my word for it.
In a letter to Congressional leaders after the House GOP plan was introduced, nearly 200 economists and health care experts wrote, "turning Medicare into a voucher program would undermine essential protections for millions of vulnerable people. It would extinguish the most promising approaches to curb costs and to improve the American medical care system."
Jeffrey Sachs, an economics professor at Columbia University, who was a key economic adviser to the World Bank, the IMF, and the World Health Organization, told MSNBC last April that the House Republican plan, "goes right out to destroy Medicaid within the next few years, slashing it drastically. And then on Medicare, it delays [cuts] for 10 years, and then [the House Republican plan] goes out to destroy it, to make sure that elderly people will not have a guaranteed access to health care. They will be getting some premium [support] but they`re going to have to put a lot of money out of pocket."
Robert Greenstein, the president of the Center on Budget and Policy Priorities, said last April that the House Republican budget "proposes a dramatic reverse-Robin-Hood approach that gets the lion's share of its budget cuts from programs for low-income Americans - the politically and economically weakest group in America and the politically safest group for Ryan to target- even as it bestows extremely large tax cuts on the wealthiest Americans. Taken together, its proposals would produce the largest redistribution of income from the bottom to the top in modern U.S. history, while increasing poverty and inequality more than any measure in recent times and possibly in the nation's history."
Ezra Klein, a columnist at the Washington Post, wrote last April that "the budget Ryan released is not courageous or serious or significant. It's a joke, and a bad one. For one thing, Ryan's savings all come from cuts, and at least two-thirds of them come from programs serving the poor. The wealthy, meanwhile, would see their taxes lowered, and the Defense Department would escape unscathed. It is not courageous to attack the weak while supporting your party's most inane and damaging fiscal orthodoxies. But the problem isn't just that Ryan's budget is morally questionable. It also wouldn't work."
Harold Meyerson, a columnist for the Washington Post, wrote on April 5th that "If it does nothing else, the budget that the House Republicans unveiled provides the first real Republican program for the 21st century, and it is this: Repeal the 20th century ... Ryan achieves the bulk of his savings through sharp reductions in projected spending on Medicare and Medicaid ... Ryan's budget would also reduce projected spending on discretionary domestic programs - education, transportation, food safety and the like - to well below levels of inflation ... The cover under which Ryan and other Republicans operate is their concern for the deficit and national debt. But Ryan blows that cover by proposing to reduce the top income tax rate to just 25 percent. He imposes the burden for reducing our debt not on the bankers who forced our government to spend trillions averting a collapse but on seniors and the poor."
Mr. Meyerson, concludes by saying this: "There's talk that we have a president who's a Democrat-- the party that created the American social contract of the 20th century. Initially, he focused on reshaping and extending that contract into the 21st. Now that the Republicans want to repeal it all, he's nowhere to be found. Has anybody seen him? Does he still exist?"
Mr. President, the deficit has been caused by unpaid-for wars, tax breaks for the rich, the Medicare Part D prescription drug program, the bailout of Wall Street, a declining economy, and less revenue coming in. The Republican "solution" in Washington is to balance the budget on the backs of the sick, the elderly, the children and the poor, to cut back on environmental protection, to cut back on transportation, while providing even more tax breaks to the wealthy and well connected. That is unacceptable and that is what we have got to stop.
Mr. President, it's not just rich individuals who are making out like bandits. As hard as it may be to believe, some of the largest, most profitable corporations in this country are not only avoiding paying any federal income taxes whatsoever, but they are actually receiving tax rebates from the IRS. And, the Republican response to this reality is to provide even more tax breaks to these corporate freeloaders. That may make sense to someone. It does not make sense to me.
Earlier this year, my office published a top ten list of the worst corporate tax avoiders in this country. I would like to take this opportunity to read this list. These are just a few of the corporations that the Republicans want to protect, while they are trying to deny millions of Americans health insurance, a college education, and nutrition assistance. Here are the top ten corporate freeloaders in America today:
1) Exxon Mobil. In 2009, Exxon Mobil made $19 billion in profits. Not only did Exxon avoid paying any federal income taxes that year, it actually received a $156 million rebate from the IRS, according to its SEC filings.
2) Bank of America. Last year, Bank of America received a $1.9 billion tax refund from the IRS, even though it made $4.4 billion in profits and just a couple of years ago received a bailout from the Federal Reserve and the Treasury Department of nearly $1 trillion.
3) General Electric. Over the past five years, while General Electric made $26 billion in profits in the United States, it received a $4.1 billion refund from the IRS.
4) Chevron. In 2009, Chevron received a $19 million refund from the IRS after it made $10 billion in profits.
5) Boeing. Last year, Boeing, which received a $30 billion contract from the Pentagon to build 179 airborne tankers, got a $124 million refund from the IRS.
6) Valero Energy. Last year, Valero Energy, the 25th largest company in America with $68 billion in sales last year received a $157 million tax refund check from the IRS and, over the past three years, it received a $134 million tax break from the oil and gas manufacturing tax deduction.
7) Goldman Sachs. In 2008, Goldman Sachs paid only 1.1 percent of its income in taxes even though it earned a profit of $2.3 billion and received an almost $800 billion bailout from the Federal Reserve and U.S. Treasury Department.
8) Citigroup. Last year, Citigroup made more than $4 billion in profits but paid no federal income taxes, even though it received a $2.5 trillion bailout from the Federal Reserve and U.S. Treasury.
9) ConocoPhillips. ConocoPhillips, the fifth largest oil company in the United States, made $16 billion in profits from 2007 through 2009, but received $451 million in tax breaks through the oil and gas manufacturing deduction during those years. 10) Carnival Cruise Lines. Over the past five years, Carnival Cruise Lines made more than $11 billion in profits, but its federal income tax rate during those years was just 1.1 percent.
In other words, Mr. President, at a time when major corporations such as General Electric and ExxonMobil make billions of dollars in profit, and pay nothing in federal income taxes, the Republican plan is to provide them with even more tax breaks.
Mr. President, large corporations are sitting on a record-breaking $2 trillion in cash. The problem is not that corporations are taxed too much. The problem is that consumers don't have enough money to buy their products and the Republican agenda would make that far worse.
Corporate tax revenue last year was down by 27% compared to 2000, even though corporate profits are up 60 percent over the last decade.
Large corporations and the wealthy are avoiding $100 billion in taxes every year by setting up offshore tax shelters in places like the Cayman Islands, Bermuda and the Bahamas. Ending that anti-American shell game could raise $1 trillion over 10 years toward deficit reduction.
In 2005, 1 out of 4 large corporations paid no income taxes at all even though they collected $1.1 trillion in revenue. The simple truth is that if we are going to reduce the deficit in a responsible way, we have got to make sure that profitable corporations pay their fair share.
Now, I understand that my Republican friends, and quite frankly some of my Democratic friends, will do everything they can to protect the wealthy and the powerful, even if it means destroying the lives of millions of Americans in the process.
But, what we need to understand, what the President needs to understand, is that poll after poll after poll shows that the Republican plan to make savage cuts to Medicare, Medicaid and education, while providing even more tax breaks to the wealthy and large corporations, is way out of touch with what the American people want.
Let me just read to you a few of these polls.
According to a recent Boston Globe poll of likely voters in New Hampshire, perhaps the most anti-tax state in this country, 73% support raising taxes on people making over $250,000 a year; 78% oppose cutting Medicare; 71% oppose cutting Medicaid; and 76% oppose cutting Social Security.
Now, Mr. President, you may be saying to yourself well, that was just one poll, and it was only polling one state. Clearly, that must have been an aberration.
Wrong. National poll after national poll have almost mirrored what New Hampshire voters are saying.
A recent NBC News/Wall Street Journal poll found the following:
* 81 percent of the American people believe it is totally acceptable or mostly acceptable to impose a surtax on millionaires to reduce the deficit.
* 74 percent of the American people believe it is totally acceptable or mostly acceptable to eliminate tax credits for the oil and gas industry.
* 68 percent of the American people believe it is totally acceptable or mostly acceptable to phase out the Bush tax cuts for families earning over $250,000 a year.
* 76 percent of the American people believe it is totally acceptable or mostly acceptable to eliminate funding for weapons systems the Defense Department says are not necessary.
* 76 percent believe it is totally unacceptable or mostly unacceptable to cut Medicare to significantly reduce the budget deficit.
* 77 percent believe it is totally unacceptable or mostly unacceptable to cut Social Security to significantly reduce the deficit.
* 67 percent believe it is totally unacceptable or mostly unacceptable to cut Medicaid to significantly reduce the deficit.
* 77 percent believe it is totally unacceptable or mostly unacceptable to cut funding for K-12 education to significantly reduce the deficit.
* 56 percent believe it is totally unacceptable or mostly unacceptable to cut Head Start.
* 59 percent believe it is totally unacceptable or mostly unacceptable to cut college student loans.
* And, 65 percent believe it is totally unacceptable or mostly unacceptable to cut heating assistance to low income families.
And, while the leaders of the Tea Party movement in Washington are fighting to dismantle Medicare and Medicaid and getting the vast majority of Republicans in Congress to follow their marching orders, 70% of those who identify themselves with the Tea Party outside of the beltway oppose cutting Medicare and Medicaid to reduce the deficit, according to a recent McClatchy Poll.
Mr. President, here is the last poll I would like to highlight. It was done by the Washington Post and ABC News, and here is what it says:
* 72% of Americans support raising taxes on incomes over $250,000 to reduce the national debt - including 91% of Democrats; 68% of Independents; and 54% of Republicans.
Yet, Mr. President, there does not seem to be one Republican in Washington, DC, who would support raising taxes on the wealthiest two percent of Americans-- those earning over $250,000 a year to reduce the deficit. Only in Washington is it considered a controversial idea to make the wealthy and large corporations pay their fair share.
Instead of listening to millionaire and billionaire campaign contributors, it is time for our leaders in Washington to start listening to the overwhelming majority of Americans who want the wealthiest people in this country and the most profitable corporations in this country to contribute to deficit reduction. It is time for shared sacrifice. The middle class, the elderly, the sick, the children, and the poor have already sacrificed enough in terms of lost jobs, lost wages, lost pensions, and lost homes. When are the wealthiest Americans and most profitable corporations going to be asked to pay their fair share? If not now, when?
And, the fact of the matter is, Mr. President, that moving towards deficit reduction in a way that's fair is not quite as complicated as the American people have been led to believe by the corporate media and right wing think tanks.
In fact, if you are not beholden to Wall Street, large corporations and wealthy campaign contributors, and you are not scared to death of the unlimited number of 30 second ads they may run against you, it is actually quite easy.
I know many people have different ideas about how we might move towards a balanced budget. I am not saying that I have all of the answers. But, let me just give a few examples of how we can reduce the deficit by more than $4 trillion dollars over the next decade that asks the wealthy and large corporations to pay their fair share and does not unfairly harm ordinary Americans.
First, if we simply repealed the Bush tax breaks for the top two percent, we could raise at least $700 billion over the next decade. The Republicans claim that repealing these tax breaks would increase unemployment. They are wrong. These tax breaks have been in place for over a decade and they have not led to a single net private sector job. In fact, under the eight years of President Bush, the private sector lost over 600,000 jobs and the deficit exploded. When President Clinton increased taxes on the top two percent, over 22 million jobs were created, and the revenue generated from this policy led to a $236 billion budget surplus.
Secondly, a 5.4 percent surtax on millionaires and billionaires would raise more than $383 billion over 10 years, according to the Joint Tax Committee. As I said earlier, a millionaire's surtax has the support of 81 percent of the American people according to NBC News and the Wall Street Journal.
Third, Mr. President, the U.S. government is actually rewarding companies that move U.S. manufacturing jobs overseas through loopholes in the tax code known as deferral and foreign source income. This is unacceptable. During the last decade, the U.S. lost about 30% of its manufacturing jobs and over 50,000 factories have been shut down.
If we ended the absurdity of providing tax breaks to companies that ship jobs overseas, the Joint Tax Committee has estimated that we could raise more than $582 billion in revenue over the next ten years. Right now we have a tax policy that says that if you shut down a manufacturing plant in America, and move to China, the IRS will give you a tax break. That may make sense to corporate CEOs. It doesn't make sense to me.
Fourth, Mr. President, if we ended tax breaks and subsidies for big oil and gas companies, we could reduce the deficit by more than $40 billion over the next ten years. The five largest oil companies in the United States have earned about $1 trillion in profits over the past decade. Meanwhile, in recent years, some of the very largest oil companies in America like Exxon Mobil and Chevron, as I pointed out earlier, have paid absolutely nothing in Federal income taxes. In fact, some of them have actually gotten a rebate from the IRS. That has got to stop.
Fifth, Mr. President, if we prohibited abusive and illegal offshore tax shelters, we could reduce the deficit by up to $1 trillion over the next decade. Each and every year, the United States loses an estimated $100 billion in tax revenues due to offshore tax abuses by the wealthy and large corporations. The situation has become so absurd that one five-story office building in the Cayman Islands is now the "home" to more than 18,000 corporations. That is wrong. The wealthy and large corporations should not be allowed to avoid paying taxes by setting up tax shelters in the Cayman Islands, Bermuda, the Bahamas or other tax haven countries.
Sixth, Mr. President, if we established a Wall Street speculation fee of less than one percent on the sale and purchase of credit default swaps, derivatives, stock options and futures, we could reduce the deficit by more than $100 billion over the next decade. Both the economic crisis and the deficit crisis are a direct result of the greed and recklessness on Wall Street. Establishing a speculation fee would reduce gambling on Wall Street, encourage the financial sector to invest in the productive economy, and significantly reduce the deficit without harming average Americans.
There are a number of precedents for this. The U.S had a similar Wall Street speculation fee from 1914 to 1966. The Revenue Act of 1914 levied a 0.2% tax on all sales or transfers of stock. In 1932, Congress more than doubled that tax to help finance the government during the Great Depression. And today, England has a financial transaction tax of 0.25 percent, a penny on every $4 invested.
Number seven, Mr. President, if we taxed capital gains and dividends, the same way that we tax work, we could raise more than $730 billion over the next decade. Warren Buffet has often said that he pays a lower effective tax rate than his secretary. And, today the effective tax rate of the richest 400 Americans, who earn an average of more than $280 million each year, is just 18 percent, lower than most nurses, teachers, firefighters, and police officers pay. The reason for this is that the wealthy obtain most of their income from capital gains and dividends, which is taxed at a much lower rate than work. Right now, the top marginal income tax for working is 35%, but the tax rate on corporate dividends and capital gains is only 15%. Taxing wealth and work at the same rate could raise more than $730 billion over a ten-year period-- and it's the right thing to do.
Number eight, if we established a progressive estate tax on inherited wealth of more than $3.5 million, we could raise more than $70 billion over 10 years. Last year, I introduced the Responsible Estate Tax Act that would reduce the deficit in a fair way while ensuring that 99.7 percent of Americans who lose a loved one would never have to pay a dime in federal estate taxes.
Number nine, we have got to reduce unnecessary and wasteful spending at the Pentagon, which now consumes over half of our discretionary budget. Since 1997, our defense budget has virtually tripled going from $254 billion to $700 billion.
Defense experts such as Lawrence Korb, an Assistant Secretary of Defense under Ronald Reagan, has estimated that we could achieve significant savings of around $100 billion a year at the Pentagon while still ensuring that the United States has the strongest and most powerful military in the world.
For example, as a result of four separate investigations that I requested, the GAO has found that the Pentagon has $36.9 billion in spare parts that it does not need and which are collecting dust in government warehouses. We have got to do a much better job than that.
And, much of the huge spending at the Pentagon is devoted to spending money on Cold War weapons programs to fight a Soviet Union that no longer exists. That has got to stop.
Further, we also must end the unnecessary War in Iraq and the War in Afghanistan as soon as possible. These wars have gone on long enough. Reducing Pentagon spending by at least $900 billion over 10 years is something that we can and must do.
Number 10, if we required Medicare to negotiate for lower prescription drug prices with the pharmaceutical industry, we could save over $157 billion over 10 years. As a result of the Medicare Part D prescription drug legislation signed into law under President George W. Bush, Medicare is prohibited from negotiating with the pharmaceutical industry to lower drug prices for seniors. This is wrong. Requiring Medicare to negotiate for lower drug prices could save the federal government and seniors over $15 billion a year.
Number 11, if we enacted a robust public option or a Medicare-for-all health insurance program, we would be able to save more than $68 billion over the next decade and provide affordable health insurance coverage for millions of Americans.
Number 12, Mr. President, as almost everyone knows, China is manipulating its currency, giving it an unfair trade advantage over the United States and destroying decent paying manufacturing jobs in the process. If we imposed a currency manipulation fee on China and other low wage countries, the Economic Policy Institute has estimated that we could raise $500 billion over 10 years and create 1 million jobs in the process.
Finally, Mr. President, I think just about everyone agrees that there is waste, fraud, and abuse in every agency of the federal government. Rooting out this waste, fraud, and abuse could save about $200 billion over the next 10 years.
Mr. President, if we did all of these things we could easily reduce the deficit by well over $4 trillion over the next decade, if not much more. It would be done in a fair way, and it would not unnecessarily and needlessly ruin the lives of millions of Americans who are struggling desperately just to make ends meet.
Mr. President, the radical right wing agenda of more tax breaks for the wealthy paid for by the dismantling of Medicare, Medicaid, education, nutrition, and the environment may be popular in the country clubs and cocktail parties of the rich and powerful, but it is way out of touch with what the overwhelming majority of Americans want.
Mr. President, as you know, late last week, Congressman Eric Cantor, the Republican Majority Leader in the House and Senator Jon Kyl, the Republican Minority Whip in the House walked out of the budget negotiations being led by Vice President Joe Biden.
And, the reason they walked out was clear. They were not willing to close one single loophole in the tax code that allows the wealthy and large corporations to avoid paying taxes by stashing their money in the Cayman Islands. They were unwilling to stop tax breaks for companies that ship jobs overseas, or close tax loopholes that give billionaires like Warren Buffet the ability to pay lower effective tax rates than their secretaries.
There is apparently no end as to how far the Republican leadership will go in Washington to protect their wealthy campaign contributors, even if it means allowing the federal debt limit to expire and causing another depression.
My sincere hope is that the President will use this Republican walkout as an opportunity to rally the American people and make it clear that he will never support Republican demands to move toward a balanced budget solely on the backs of working families, the elderly, the children, the sick, and the poor.
But, I don't think that the President will do this unless the American people send him a message that enough is enough! The American people have got to write to the President and tell him not to balance the budget on the backs of the most vulnerable people in this country. Do not decimate Medicare, Medicaid, Pell Grants, education, and the environment to pay for more tax breaks for the rich and powerful. Stand up for the millions, who have seen their homes, jobs, and savings vanish, instead of the millionaires, who have never had it so good.
For those of you who are listening to this speech, if you believe that enough is enough, if you believe in shared sacrifice, if you believe that it is time for the wealthiest Americans and most profitable corporations to contribute to deficit reduction, go to my website: sanders.senate.gov. At this website, you will find a letter to the White House that you can sign-- let me read what it says:
"Dear Mr. President,
"This is a pivotal moment in the history of our country. Decisions are being made about the national budget that will impact the lives of virtually every American for decades to come. As we address the issue of deficit reduction we must not ignore the painful economic reality of today - which is that the wealthiest people in our country and the largest corporations are doing phenomenally well while the middle class is collapsing and poverty is increasing. In fact, the United States today has, by far, the most unequal distribution of wealth and income of any major country on earth.
"Everyone understands that over the long term we have got to reduce the deficit-- a deficit that was caused mainly by Wall Street greed, tax breaks for the rich, two wars, and a prescription drug program written by the drug and insurance companies. It is absolutely imperative, however, that as we go forward with deficit reduction we completely reject the Republican approach that demands savage cuts in desperately-needed programs for working families, the elderly, the sick, our children and the poor, while not asking the wealthiest among us to contribute one penny.
"Mr. President, please listen to the overwhelming majority of the American people who believe that deficit reduction must be about shared sacrifice. The wealthiest Americans and the most profitable corporations in this country must pay their fair share. At least 50 percent of any deficit reduction package must come from revenue raised by ending tax breaks for the wealthy and eliminating tax loopholes that benefit large, profitable corporations and Wall Street financial institutions. A sensible deficit reduction package must also include significant cuts to unnecessary and wasteful Pentagon spending.
"Please do not yield to outrageous Republican demands that would greatly increase suffering for the weakest and most vulnerable members of our society. Now is the time to stand with the tens of millions of Americans who are struggling to survive economically, not with the millionaires and billionaires who have never had it so good."
If you're listening out there, and agree with what I am saying, but are wondering what you can do to make a difference, I would urge you to consider signing this letter. Staying silent and doing nothing is not an option. Your voice needs to be heard and you can make a difference.
Mr. President, we have seen this movie before. The Republicans, led by their extreme right wing, have been successful in getting their way because of their refusal to compromise and their willingness to hold the good credit and economic security of the American people hostage.
In December, the Republican leadership was prepared to hold the middle class tax cuts and unemployment benefits hostage in order to extend the Bush tax breaks for the top two percent. The Republicans won and as a result over $200 billion was added to the deficit over the next two years.
Specifically, the December tax cut agreement extended the Bush income tax rates for those earning more than $250,000; maintained lower tax rates on capital gains and dividends; and lowered the estate tax which only benefits the top 0.3 percent. Let me remind, my colleagues who the biggest winners were from last December's tax cut agreement.
According to Citizens for Tax Justice, extending the Bush tax breaks for the top 2 percent has provided Rupert Murdoch, the CEO of News Corporation, with an estimated $1.3 million tax break.
Tom Donohue, the head of the U.S. Chamber of Commerce, who has urged American corporations to ship jobs overseas, will receive an estimated $215,000 tax break from this deal.
Jamie Dimon, the head of JP Morgan Chase, whose bank received a bailout of over $160 billion from the Federal Reserve, will receive an estimated $1.1 million tax break from this deal.
Vikram Pandit, the CEO of Citigroup, a bank that got more than $2.5 trillion in near zero interest loans from the Fed, will receive an estimated $785,000 tax break by extending the Bush tax cuts.
Ken Lewis, the former CEO of Bank of America, a bank that got nearly a trillion dollars in low interest loans from the Fed, will receive an estimated $713,000 tax break.
The CEO of Wells Fargo (John Stumpf), whose bank got a $25 billion bailout, will receive an $813,000 tax break from this deal.
The CEO of Morgan Stanley (John Mack), whose bank got more than $2 trillion in low interest loans from the Fed, will receive a $926,000 tax break from this agreement.
The CEO of Aetna (Ronald Williams) will receive a tax break worth $875,000.
The CEO of Cigna (David Cordani) will receive a $350,000 tax break. And, on and on it goes.
The rich get richer, the poor get poorer, and the middle class disappears. That is what is going on in this country today.
Then, Mr. President, In April, the Republicans in Congress were prepared to shut down the government, disrupt the economy, and deny paychecks to 800,000 federal workers if they couldn't get their way in slashing programs for low and moderate income Americans. As a result, the President and this Congress agreed to virtually everything the Republicans wanted by enacting a budget that slashed $78 billion from the President's request.
Let me give you just a few examples of what kinds of cuts were included in this year's spending agreement: At a time when college education has become unaffordable for many, Pell grants are now being reduced by an estimated $35 billion over 10 years.
At a time when 50 million Americans have no health insurance, at a time when we have a crisis in access to primary care, and at a time when 45,000 Americans die each and every year because they delay seeking care they cannot afford, the 2011 spending agreement cut $600 million from community health centers and $3.5 billion from the Children's Health Insurance Program.
At a time when we should be putting Americans to work rebuilding our crumbling infrastructure, federal funding for new high-speed rail projects was eliminated. In other words, the rich get richer, while the needs of ordinary Americans are attacked. And, today, the Republican Leadership has made it clear that, unless they get their way on implementing a significant part of the Ryan budget in 2012, they are prepared to vote against raising the debt ceiling. If the debt ceiling is not extended, the United States will, for the first time in history, default on its debt and likely plunge the world's financial markets into a major crisis. Yet that is just what the Republican leadership and its members are threatening to do. Shame on them.
Mr. President, in many ways, the Republicans in Washington have been acting like school yard bullies. And, as we know, bullying is a serious problem in our schools. Every educator worth his or her salt will tell you that when you're dealing with a bully, you must not give into their tactics or tolerate their temper tantrums - you have to deal with them sternly and consistently. You cannot allow them to win by dictating the rules of the game and trampling over everyone else if they don't get their way.
Mr. President, we have a serious deficit problem that must be solved, no one would deny it.
But the problem is not that we spend too much on the needs of the elderly and have to slash Social Security; the problem is that we have provided hundreds of billions in tax breaks to millionaires and billionaires who don't need them and in many cases don't want them.
The problem is not that we spend too much money on financial aid for college and have to slash Pell Grants. The average college senior today is graduating with $24,000 in debt. The problem is that each and every year, large corporations and the wealthiest in our society are avoiding $100 billion in federal taxes through tax shelters in the Cayman Islands, Bermuda and other places throughout the world.
The problem is not that we are spending too much on childcare. Childcare is increasingly becoming out of reach for too many American families. The problem is that about one out of four large and profitable corporations in this country do not pay any federal income taxes, and in many cases get a tax rebate from the IRS.
The problem is not that we spend too much money to reduce childhood poverty in this country. We have the highest childhood poverty rate in the industrialized world! The problem is that when all is said and done we will have spent $3 trillion on the unnecessary and misguided Iraq War.
Mr. President, the problem is that this deficit was caused by actions voted for by nearly all of my Republican friends: the wars, tax breaks for the rich, Medicare Part D, and the Wall Street Bailout. In the middle of a recession when the middle class and working families are already hurting, when poverty is increasing it is not only immoral, it is bad economics to balance the budget on working families and the most vulnerable people in this country.
When people are hurting, when they have lost their jobs, when their incomes are going down, you do not say to those people: We are throwing you off Medicaid. We are going to end Medicare as we know it, we are going to cut back on Federal aid to education so your kid cannot go to college. That is not what you say in a humane and fair society.
On the other hand, at the same time as the wealthiest people are becoming phenomenally wealthier, and when large corporations are making huge profits, and in many cases not paying any taxes at all, it is entirely appropriate-- in fact, it is a moral imperative-- to say to those people: Sorry, you are also American. You have got to participate in shared sacrifice. You have also got to help us reduce the deficit.
That is where we are right now. We are at a pivotal moment in the midst of a major debate, but it is not only on financial issues. It is very much a philosophical debate. It is a debate about which side you are on. Do you continue to give tax breaks to the very rich and make savage cuts for working families, for children, the elderly, the poor, the most vulnerable?
Mr. President, another thing that is rarely mentioned on the floor of the Senate is the $3 trillion Federal Reserve bailout, that was only fully made public after I inserted an amendment into the Dodd-Frank Act last year to require that it be made public.
As it turns out, while small business owners in the State of Vermont and throughout this country were being turned down for loans, not only did large financial institutions receive substantial help from the Fed, but also some of the largest corporations in this country also received help in terms of very low interest loans.
And, here is something we also learned: this bailout was not just about American banks and corporations but foreign banks and foreign corporations also received hundreds of billions of dollars from the Fed as well.
Then, on top of that, a number of the wealthiest individuals in this country also received a major bailout from the Fed. The "emergency response,'' which is what the Fed described their action as during the Wall Street collapse, appears to any objective observer to have been the clearest case that I can imagine of socialism for the very rich and rugged free market individualism for everybody else.
In other words, if you are a huge financial institution, like Goldman Sachs, whose recklessness and greed caused this great recession, no problem. You get almost $800 bilion in near zero interest rate loans from the Fed. If you are a major American corporation, such as General Electric or McDonald's or Caterpillar or Harley-Davidson or Verizon, no problem. You received a major handout from the U.S. Government.
But if you are a senior citizen living in a nursing home paid for by Medicaid, well, guess what, you are on your own.
If you are an elderly person who cannot afford to heat their homes in the winter when the temperature is 20 below zero, tough luck. We don't have any money for you. But, if you happen to be the state-owned Bank of Bavaria-- not Pennsylvania, not California, but Bavaria-- the Federal Reserve has enough money to loan you over $2.2 billion by purchasing your commercial paper.
The Fed said this bailout was necessary in order to prevent the world economy from going over a cliff. But over 3 years after the start of the recession, millions of Americans remain unemployed and have lost their homes, their life savings, and their ability to send their kids to college. Meanwhile, huge banks and large corporations have returned to making incredible profits and paying their executives record-breaking compensation packages, as if the financial crisis they started never occurred.
Mr. President, everyone understands that over the long-term we have got to reduce our record-breaking $14.2 trillion national debt. But, we must reduce the deficit in a fair way and not balance the budget solely on the backs of the middle class, the sick, the elderly, the children and the poor.
That means we absolutely must tell the wealthy and large corporations that it is high time that they to pay their fair share in taxes. And, that means that the President has got to stand tall and stand firm and let the American people know that if we do default on our debt obligations, if America and the world economy is plunged into a depression, it was because the Republicans refused to raise the taxes of the wealthiest Americans and most profitable corporations in this country by one red cent.
Shared sacrifice isn't just good public policy, it is also what the American people want. Overwhelming majorities of the American people believe that the best way to reduce the deficit is to end tax breaks for the wealthy, big oil, Wall Street, and that we must bring our troops home from Afghanistan and Iraq.
It's about time that Washington listened to the American people. Let's reduce the deficit. But, let's do it in a fair and responsible way that requires shared sacrifice from the wealthiest Americans and most profitable corporations.
I thank the President and I yield the floor.
BERNIE ISN'T RUNNING FOR PRESIDENT, BUT . . .
. . . he'll be fighting a Senate reelection battle next year. Think his voice needs to continue to be heard? You can help out here... while you listen to Mojo Nixon's perspective on banksters.
