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The ALEC Cabal: How Influence Peddlers Undermine Democracy

8:24 am in Uncategorized by Gerald McEntee

"Power and Influence"

"Power and Influence" by Wandering Eyre on flickr

As the eyes of the nation are focused on lawmakers in Washington this week, hundreds of right-wing state legislators are quietly meeting with corporate lobbyists behind closed doors in a New Orleans hotel to draft far-reaching legislation. The secret meetings, underwritten by powerful special interests –  including the insurance and banking industries, big oil and the pharmaceutical giants – are part of an on-going effort to subvert the public interest by an industry backed-group shamelessly called the American Legislative Exchange Council (ALEC). This hidden collusion between well-financed lobbyists and elected legislators undermines the basic American values of public debate and full-disclosure that Americans rightly expect when our laws are made.

Through ALEC, big corporations lay out more than $6 million a year to wine and dine state legislators, and pay for expensive vacations and junkets, while at the same time drafting corporate-friendly legislation that the politicians then push when they return to their statehouses. This covert coalition of state legislators and Wall Street moneymen has been surreptitiously working out of the view of Main Street Americans to dismantle health, safety and environmental regulations, privatize vital public services, restrict the ability of working men and women to make a fair wage, and reduce the ability of seniors, students, minorities and the poor to vote. All done behind closed doors without the press or public seeing whose palm is greased.

More than 2,000 state legislators are in on the game. Over the years, with corporate backing in their campaigns, they often go for higher office, like former ALEC members Speaker of the House John Boehner and House Majority Leader Eric Cantor. More than 70 members of Congress and governors have attended the closed-to-the public get-togethers where corporate CEOs lay out the agenda for the year ahead. It is no coincidence that Gov. Scott Walker of Wisconsin and Gov. John Kasich of Ohio made attacks on the middle class and collective bargaining rights their top priorities, rather than find real solutions and focus on job creation, when they took power earlier this year. They are both ALEC alumni. Read the rest of this entry →

Why Unemployment Makes the Tea Party Happy

8:21 am in Uncategorized by Gerald McEntee

DONT TREAD ON ME

DONT TREAD ON ME by DonkeyHotey

The tea party Republicans have drawn a line in the sand. The debt ceiling was raised five times during the administration of President George W. Bush. Yet, it is only now, with tea party Republicans holding the balance of power in the U.S. House of Representatives, that America is placed in the position of defaulting on our commitments, for the first time since the founding of our country.

Their irresponsible position is that corporations and billionaires should not have to share the sacrifices needed to keep our economy on track for recovery. That is why they vehemently oppose efforts to cut corporate welfare and to eliminate subsidies for the oil companies. Unlike most Americans, who believe we should pull together to find real solutions, these politicians are intent on dividing Americans by destroying programs that have broad public support. At the same time, they have done all in their power to create instability in the economy and put more Americans out of work.

With more than 14 million Americans out of the job market, it is appalling for these politicians to play games with our nation’s economy. Creating jobs and keeping Americans working have to be top priorities. But for the tea party Republicans controlling the House of Representatives, those are far from the top of their “to-do” list. Instead, they have repeatedly passed bills that would put more Americans out of work. A harsh conclusion, perhaps, but just look at the facts:

Since the tea party took over the U.S. House of Representatives in January 2011, they have pushed legislation which, if enacted, would have added more than 6.5 million additional workers to the unemployment rolls:

• The Economic Policy Institute estimates that nearly 1 million jobs would have been lost if their 2011 appropriations bill had been enacted.
• Their bill to repeal the Affordable Care Act would have cut as many as 400,000 jobs annually, according to the Center for American Progress.
• And the Ryan Budget they passed, which destroys Medicare and Medicaid, student loan programs and health care research, would put as many as 3 million more workers out of their jobs during the next five years.

Thankfully, President Obama and cooler heads in the Senate have kept these job-killing bills from becoming law. But they all passed the tea party-controlled U.S. House of Representatives.

Tea party politicians have been ramming through similar misguided bills at the state and local level. Scott Walker in Wisconsin, John Kasich in Ohio, Chris Christie in New Jersey and Rick Scott in Florida are just a few of the elected officials who have pushed policies to put people out of work. All of them turned down federal funding for transportation projects that could have produced hundreds of thousands of jobs. And they have ruthlessly cut budgets rather than ask billionaires in their states to pay their fair share of taxes. Their actions are hurting job creation, even in the private sector. As economist Adam Hirsch noted on the website Think Progress last month: “States that cut spending are seeing significantly more job losses in the private sector than states maintaining or increasing spending levels.”

In the last Congress, tea party Republicans consistently voted to increase unemployment. In August of 2010, for example, every tea party-backed politician in Congress voted against legislation to provide assistance to the states to pay for teachers, firefighters and vital public services. If they had their way, 300,000 additional jobs would have been lost, adding to the more than 500,000 state and local jobs that have been lost in recent years. The next time a tea party politician tells you that jobs are what they care about, remind them that if it had been up to them, every auto worker at General Motors would be out of work today. And what about the jobs saved or created by the American Recovery and Reinvestment Act? They opposed the bill kicking and screaming, yet every thinking economist in the country agrees that it saved or created anywhere from to 2 to 4 million jobs.

While they consistently pay lip service to “reducing the debt,” that is not their real goal. Their tax cuts for corporate CEOs and hedge fund managers actually increase our debt. As FactCheck.org, under Ryan’s plan “the public debt would increase from $10 trillion in 2011 to $16 trillion in 2021,” even while decimating essential programs for Main Street Americans. That’s because Ryan adds to his Draconian cuts with even larger tax giveaways to his friends on Wall Street. (Ryan wasn’t drinking tea with his Wall Street pals last week. He and two companions spent $700 on two bottles of wine at a Capitol Hill restaurant.)

One is tempted to conclude that the tea party Republicans see political benefit from increasing unemployment while President Obama is at the helm. Michelle Bachmann, in an unguarded moment last week, admitted as much. Whatever their motivation, their policy choices do not reflect the Main Street values shared by most Americans.

It is clear, however, that many of them are willing to tip the country into a double-dip recession and put the world economy into a tailspin. They are, as Warren Buffett said last week, “playing Russian roulette.” And if that leads to more unemployment, apparently the tea party Republicans really don’t care.

It’s Time to Hold Wall Street Accountable

1:53 pm in Business, Financial Crisis, Government by Gerald McEntee

Almost two years have passed since the taxpayers of America gave the titans of Wall Street more than $700 billion to keep the world’s economic system from plunging into another world-wide Great Depression. Yet, the big banks, the Wall Street investment houses, the hedge funds and the CEOs of America’s top companies still have not taken the steps needed to tighten up the shoddy practices that led our economy right to the edge of the cliff.

Even worse, they are fighting common sense reforms being debated in the Senate that would end the insider games that put millions of Americans out of work, stole billions from our retirement plans, and left states and cities with huge amounts of unsustainable debt. They are spending millions of dollars on lobbying to prevent the Senate from enacting tough new rules to prevent another financial crisis and give investors and the public the kind of protection that has been missing for far too long in our economy.

Four years after the stock market crash of 1929, President Roosevelt and New Deal Democrats enacted important reforms to held Wall Street accountable. Those rules kept the financial system operating on an even keel for more than 50 years. But, beginning with the election of Ronald Reagan in 1980, the New Deal regulations were undermined, giving Wall Street unfettered freedom to turn our financial markets into a casino, where the homes and retirement security of middle class Americans became little more than chips to the traders and the CEOs.

While most Americans think of stocks and bonds as the investment instruments we purchase, Wall Street was busy creating new, risky and unregulated products like “collateralized debt obligations,” and “credit default swaps.” The lack of oversight and accountability in the trading of these new products led to the meltdown of 2008 and economic catastrophe. That is a major reason why we need new rules to regulate transactions of new and complex financial instruments.

All across the country, cities and towns, school districts and even sewer systems have been hit hard by these Wall Street products. Sellers misrepresented these instruments as a way to help reduce the financing costs for public projects, but hidden features were included that ultimately are costing taxpayers billions, if not trillions, in added costs. In Alabama, for instance, Jefferson County sought Wall Street financing for a $250 million sewer system. After purchasing a wide variety of “tools” from Morgan, Goldman Sachs and Lehman Brothers, the taxpayers of Jefferson County now owe more than $1 billion, just in interest and fees on their debt.

In every region of the country, Wall Street has sold derivatives that essentially bet on municipalities defaulting on their loans. Using “municipal swaps,” the banks give investors a way to sell short – or bet against – countless cities, towns and states, including California, Michigan and New York. This is nothing short of a potential time-bomb for taxpayers, giving investors an opportunity to make millions while taxpayers might be forced to pay billions to paying off Wall Street gambling bets.

The financial reform bill being debated in the Senate would regulate the derivatives market and provide much-needed transparency to these risky deals. The Senate needs to resist the efforts of Wall Street and their Republican allies and pass this legislation immediately. The debate in the Senate has gone on long enough. It is time to get the job done and ensure that American people are not left paying billions of dollars because of the unregulated greed of Wall Street and the big banks. It’s time for Congress to send a clear message that they will side with Main Street and not cave in to the power and money of Wall Street. It is time to close the casino.