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The Washington Post, which long ago abandoned rules of journalistic objectivity in pushing its agenda for cutting Social Security and Medicare, today covered up the plans by deficit commission’s co-chairs to violate the commission’s charter. The Post reported that the commission expects to delay voting on a plan until December 3. This means that the commission will miss the December 1 deadline for a final report specified in both its by-laws and its charter.
If the Post were not so committed to Bowles and Simpson’s agenda then it would have called readers attention to the fact that they are violating the rules under which the commission was established. Of course, if it were following standard journalistic practices, the Post would have pointed out that the deficit increased not because of out of control spending, as the co-chairs have repeatedly claimed, but primarily due to the downturn caused by the collapse of the housing bubble.
It also would have pointed out that the huge long-term projected deficits are entirely attributable to the broken health care system. If the United States paid the same amount per person for health care as countries with longer life expectancies we would be facing huge budget surpluses, not deficits. However, because it editorial position dominates its news section, almost no readers of the Post would know this simple and important fact.
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I am surprised that the Catfood Commission didn’t re-write the whole Constitution.
Someone correct me if I’m wrong. Wasn’t money from the SS Trust Fund taken out to pay for the exorbitant W tax cuts for the uber-wealthy? Isn’t the purpose of this Commission to cover up that borrowing so the money doesn’t have to be paid back?
Looks like they tried to, with their idiotic Preamble.
Here’s the real deal.
It also would have pointed out that the huge long-term projected deficits are entirely attributable to the broken health care system. If the United States paid the same amount per person for health care as countries with longer life expectancies we would be facing huge budget surpluses, not deficits.
link?
Rules? who cares about rules anymore if it benefits the rich? We’re watching the collapse of a nation which once had much potential.
It’s like watching a talented teenager get on crack or booze and waste their life.
America is on crack
We could end both wars 10 years no Ossama its time to tell the military industrial complex the free ride is over.
The catfood guys want to raise gas taxes hasn’t anyone told Obama’s catfood commission consumer spending will drop like a stone if that happens?
If SS gets cut consumer spending gets cut.
If the rich get tax cuts then they will invest that money to create jobs overseas in more vibrant economies. Resulting in less jobs here and consumer spending then gets cut.
Does anyone on this commission understand economics real economics not the Chicago/Austerian kind.
Did the CBO check the Catfood commission’s numbers and the economic consequences of said plan?
Oh come on. They are simply priming the pump so that the masses of America can be completely cut off. They have no conscious and know that over 29 million Americans are unemployed/under paid, and uninsured. It is a show for them to prove to the country there is no money for you, but the rich needs theirs and our military needs to war.
That won’t help to bring back the loved ones from the senseless slaughter.
Link.
Of course not! No checks, no balance, just bulldoze it but make nice for the public viewers.
The trust fund money was given to the Treasury in return for bonds, and entered the general fund. Thus you can make whatever argument you want about where the money went. I’ve heard wingnuts say that it was stolen by liberals to pay for social spending. I think, technically, it went to the Reagan tax cuts, since the surplus started in the 80s. It was nothing new with Bush. This is a 30 year problem, not merely a 10 year problem.
When Gore was talking about putting SS in a “lockbox” during the 2000 campaign, this is what he was talking about. You run a general fund surplus, earmark it to pay down the national debt (the SS trust fund is not counted as part of the national debt), thus effectively transferring the debt from the general fund to the trust fund, then when it comes time to redeem the bonds, you transfer the money back, either redeeming the bonds for cash from your current general fund surplus, or rolling it into new general fund bonds.
Continuing to run a deficit while accepting the SS surplus as a third form of funding constitutes the “raid”.
Raise retirement age, cut retirement benefits, gas taxes, farm payments cut, Isn’t this what EU nations do after they get a bank bailout?
Did we get a bailout and nobody noticed China just kept buying out debt even though our debt is worthless?
No Tax Increases on the rich, no End to Both Wars, No National Healthcare savings then no chance we can pay our debt.
Effectively you are correct. The deficit caused by the Bush tax cuts for the rich caused the government to borrow – and the Social Security Trust fund invests in government bonds – which are issued to do the borrowing. SS MUST invest in gov bonds by law – because owning non-gov bonds is socialism by the back door – change that law and get the SS Trust fund assets into non-gov assets – the way other countries invest their social net trust funds – and the deficit must be paid off by tax increases on the rich – ie, the rich pay back the money loaned to them.
On another note, Will the Jan Schakowsky plan get a commission vote on Friday?
Thanks. Is part of the discussion a plan to default on the bonds issued by the trust?
Cat Foodies on CSPAN 3 right now
brb w/ online link if there is one
On another note, Will the Jan Schakowsky plan get a commission vote on Friday?
The Chairmen dissed her today by not even giving her a copy of the new plan until today.
If she is not allowed a vote on her plan – if we just get the chairmen’s plan – this whole game was a set-up and the other members of the commission were not needed. Indeed, the GOP is now saying that it does not matter if the plan does not get the 14 votes that automatically moves the plan to Congress – the GOP says the Chairmen’s plan will be the source of the ideas they will discuss and in some form implement – no matter how many votes its gets.
Tea Baggers say cut government spending wasteful government spending. Tell me when we cut egg inspections we get egg recalls. When we don’t inspect pork from American pig farms that move to Mexico to escape wasteful government regulation
“Smithfield Foods, a Virginia-based US company and the world’s largest producer and processor of pork products.”
http://www.timesonline.co.uk/tol/life_and_style/health/article6182789.ece
When we don’t monitor government contracts things like Katrina happen. Things like KBR electrocuting how many of our troops by being to cheap to hire Union Workers happen.
cspan3 link: http://www.c-span.org/flvPop.aspx?src=cspan3&msg=You+are+watching+C-SPAN3+LIVE&start=5.704&end=-1
watch Cat Foodies online here:
http://www.c-span.org/Watch/C-SPAN3.aspx
Fine then lets see if Nancy and Harry can hold firm and vote against this if they can’t hold every Dem vote against something as unpopular as this then they are not leaders.
The GOP I know can hold all their members against our plans.
They have no understanding that their wealth is built on us. :)
Also the no tax rate increases on the top 1% sticks in the craw when the fellow selling the catfood plan talks about “shared sacrifice”. I realize that treating investment income the same as wage income is a major blow to the rich in most cases – but today with the large capital gain losses that are being carried forward, the change just triples the value of those losses – and makes them available immediately rather than capped at being used at a rate of $3000 plus the years cap gains each year in the future.
Another con job.
By-laws and charter? We don’t need no steenkin’ by-laws and charter.
The Washington Post, which long ago abandoned rules of journalistic
objectivityintegrity …There, fixed it for ya.
Wouldn’t know about the WaPoo for sure, of course. I stopped reading it when Froomkin left.
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They’re having great laughs over cocktails with that one.
Sure they do. we’re “human resources”. What they really don;’t know is that their welth is built on the EARTH’S resources and there’s a finite supply
This thread is probably dead, but in case you check back…
The issue is not default. I think the Republicans want the trust fund bonds to be rolled over, rather than redeemed. Remember, they are not counted as part of the national debt, so rolling them over isn’t counted.
What should happen is that when a trust fund bond matures, SS returns it to the Treasury who gives them cash (say $5 billion), which SS then uses to cover the checks they write to baby boomers. Where does the $5 billion come from? Either from current tax revenues (raise taxes on the wealthy to redeem the bonds) or by issuing a new general fund bond, which is counted as part of the national debt. This is how they claim that SS contributes to the deficit – it’s just an accounting scam.
Instead, they want SS to roll that bond over – SS takes it to the Treasury and accepts a new bond in its place, and stiffs the baby boomers the $5 billion they paid in over the years.
Seems we really need to push a drive to “pay ourselves first!”
Aren’t the Chairmen defying the president by holding meetings and votes after today? How will staff be paid and the rent check written? How will they keep the lights on?
Is Pete Peterson simply picking up the whole tab from now on? Because it sounds like the taxpayers can’t.
Let me try to phrase this better.
The original Greenspan Commission (1981-1983) was a crock. Perhaps (but probably not) the members were trying in good faith to fix SS, but with the accounting rules put in place (the SS trust fund is an intra-government loan, not part of the national debt) it became a ticking time bomb.
The national debt is really $ 2.5 trillion higher than acknowledged. This will (IIRC) peak out at $4.5 trillion eventually.
SS loaned the surplus (excess taxes levied on workers up to the cap) to the Treasury and accepted bonds in return (this was required by law). That’s how it “saved” the money.
There is nothing intrinsically wrong with that – it’s just like you bought a 30 year bond when you were 40 and put it in your safe deposit box, with the idea that when you turn 70 and the bond matures the Treasury redeems the bond (gives you your money back) and you use it to meet living expenses in your golden years.
The difference is that the Treasury has to count the bond you bought as part of the national debt, but the SS bond is not counted. Just accounting tricks, no difference in reality.
The net effect on the general budget for the last 27 years is that there was a steady stream of money (the SS surplus), resulting from excess taxes on workers, that appeared in the budget, and the bonds they traded for it didn’t have to be counted.
The best thing the government could have done with the SS surplus money is to earmark it to reduce the general national debt. This was Gore’s “lockbox”. However, unless you had a balanced budget, this is meaningless – dollars are fungible, and paying off some bonds over here doesn’t help if you sell twice as many bonds over there.
Guess what they did instead? They spent it.
By not counting the SS trust fund bonds as part of the deficit or debt, they created the illusion (just accounting tricks) that the deficits were smaller (by the amount of the SS surplus) than they really were. This created the illusion that we could afford the Reagan tax cuts.
Effectively, they taxed the workers and gave the money to the wealthy.
Redeeming the SS trust fund bonds brings that debt back onto the balance sheet, thus “increasing the deficit”. This is what they are all excited about. Not any real money flows, just bringing off-balance-sheet liabilities back on the balance sheet.
The Treasury has to get the money to redeem the SS trust fund bonds from somewhere. There are two options: current tax revenues or selling an offsetting bond.
The third option, rolling the SS trust fund bond over into a new trust fund bond, does not provide any cash to SS to meet obligations (necessitating benefit cuts, raising the retirement age, or removing the cap), but allows the liability to stay off-budget.
Case 1: redeem the SSTF bond by issuing a normal bond. This brings the liability on-balance-sheet, but provides cash to pay benefits.
Case 2: roll the SSTF bond into another SSTF bond. No default takes place. The SSTF remains the same, and the liability remains off-balance-sheet. No cash is there to pay benefits.
Case 3: claw back the money from the wealthy that they received from the Reagan tax cuts by raising their taxes and redeeming the SSTF bonds for cash. The on-balance-sheet debt stays the same, the SSTF is reduced, and cash exists to pay benefits.
Yes, his “sacrifice” is that his government pension will be frozen just like everyone else’s. But not the $335,000 a year he gets from being a director for Morgan Stanley. He’s another bankster. Made his big money as a hedge fund manager.
To be fair, the report hasn’t been submitted yet. Hell, it hasn’t even been voted on yet. I don’t know what this “report” really is. Maybe it’s the draft that the commission members are supposed to vote on? I mean, if they put the vote off until Friday (contrary to their by-laws and charter) then this CAN’T be the official report, can it? So, on what basis are they releasing it? The same basis they released their “co-chairmen’s draft” three weeks ago?
It probably doesn’t matter. The WaPo is on board, and so is CBS. I’m pretty sure Fox will be, although I don’t know how their Tea Party will respond. Of course if they are, CNN will be. Most of the other Villagers are on board with this already, and they’ve been pushing the lies for months.
I brought the two charges made by Dr. Baker — that the Bowles-Simpson Commission exceeded their mandate as laid down in their charter and bylaws, and that the Washington POST covered this up in their coverage in line with the POST’s editorial policy — to the attention of the POST’s ombudsman and through him to Lori Montgomery, the writer. The ombudsman strongly denied that the POST’s new coverage is dictated by its editorial position, saying he had never seen anything of that kind over the last year. Ms. Montgomery said that the White House had agreed with the extension until Dec. 3. Since the charter and the bylaws were based on the Executive Order creating the commission, which also (Para 5) specified the Dec. 1 date, and since the President had agreed to the extension and could amend the Executive Order, in fact Simpson and Bowles were acting within their authority in principle and there was nothing to “cover up.” I suggested to Ms. Montgomery that it might have been better to have included the White House’s agreement in the article, to avoid leading people to the misimpression Dr. Baker evidently had; but in any case it seems as if neither the commission nor the POST did the things of which Dr. Baker accused them.
In general, it might be better to undertake such checking if possible before blogging on such issues. I’ve had a number of contacts with POST ombudsmen, and they’ve generally been quite surprisingly quick and complete in their answers, given the amount of incoming material they no doubt receive.
“If the United States paid the same amount per person for health care as countries with longer life expectancies we would be facing huge budget surpluses, not deficits.”
In fact, even if we paid the same “percentage of GDP” per person, which is much higher than that amount, we’d be saving close to a trillion dollars per year.
Last I heard, the U.S. pays about 17% of its $14.12 trillion/year GDP for healthcare, i.e., $2.4 trillion/year. By contrast, the rest of industrialized nations of the world pay about 10% of GDP for healthcare, at which rate the U.S. would save roughly a trillion dollars per year, which is 50% more than our military budget.