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Deficit obsession is a creation of the ultra right message machine

3:57 pm in Uncategorized by Donald Goldmacher

By Frances Causey

Goldman Sachs CEO Blankfein in a suit

Goldman Sachs CEO Lloyd Blankfein is one of the fiscal cliff's biggest fans.

Journalists have long loathed to write about and report on economics, dismissing the entire field as too hard to understand or impossible to reduce to a quote or a sound bite. Because of this, working Americans are paying the price as the parameters of the current debate around the deficit, budget and the so-called fiscal cliff are being defined by the likes of Goldman Sachs CEO Lloyd Blankfein and Peter G. Peterson, two men who are heavily invested in the outcome around the subject. With important programs like Social Security and Medicare on the line, there can be little doubt that working people are not represented in Washington.

Reading mainstream media headlines and watching cable news is really bad for your bottom line because those stories are for the most part based on content churned out by the huge public relations machines funded by Peterson and Blankfeins’ Goldman Sachs. This ideologically driven (we only want government when it enriches us) information is neither comprehended nor analyzed by the journalists or news outlets that send them out like retreads on a worn tire. In other words, if a lie is repeated enough it becomes the truth.

This writer encourages readers to look not to the mainstream media, but to the work of academics like economist Dean Baker from the Center for Economic Policy and Research. In today’s maelstrom of corporate owned news, we must turn directly to the source of good, non-partisan information. Dean Baker’s “think tank” is actually “reporting” and researching the facts behind our economic crisis unlike Peterson’s money fueled organization, which spews its founder’s personal beliefs and then manipulates the data to support them, all of which lead to the “creation” of the fiscal cliff to begin with. Please stop and question everything you see and read about the deficit because chances are it’s loaded with billionaires self-interested political and financial goals.

As Dean Baker, who predicted our crisis many years ago, points out, our deficit was both relatively modest until the economy collapsed in 2008. And as neither Republicans nor Democrats would like to admit our deficit is not “attributed to “extravagant social spending”. Baker writes with authority that this is “straightforward and not debatable.”

Baker’s research also shows that our current deficit, which is 10 percent of GDP, was created when the housing bubble induced the economic collapse, which then lead to a sort of perfect storm or a “plunge” in tax collections, coupled with an increase on spending for food stamps and unemployment insurance. So now you have the simple, unvarnished truth about the roots of our economic collapse. Is it really that hard to understand? But seriously, we encourage all citizens concerned about their own “economy” to discover the facts for themselves. We did at Heist and came up with our own solutions to “fix the debt”.

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The so-called “Fiscal Cliff” is “austerity” in disguise

1:00 pm in Uncategorized by Donald Goldmacher

Note: This post was written by HEIST co-producer and co-director Frances Causey.

The war against people who work for a living in this country continues with the “Grand Bargain” that will slash social spending by trillions on programs that benefit the most vulnerable among us and also “reform” Social Security and Medicare.

We at Heist: Who stole the American Dream? see the cruel irony in this brazen attempt to further erode living standards for the 98%. Today, some 70 percent of Americans pay more in payroll taxes than they do in income taxes! Social Security and Medicare are not “entitlement” programs. Hard working Americans along with their employers pay into this system their entire working lives. But rather than tax corporations and the super rich by allowing the Bush tax cuts to expire, apparently President Obama, Congress and the corporate-financial class on Wall Street would prefer instead to “balance” the budget on the backs of working Americans. Senator Bernie Sanders points out in HEIST the callous indifference inherent in Washington’s march towards austerity.

“Let’s go after little kids, let’s go after the elderly, let’s go after the sick, let’s go after the most vulnerable, but apparently in the Senate we can’t ask Chevron to pay taxes.

How much more can working people give up before they rise up? The tally so far? Across the board, wages have stagnated since the mid-70’s, over 40 million good paying jobs with benefits have been shipped overseas, trade agreements that benefit the corporate and shareholder classes prevail, employers are asking workers to pay more for healthcare, risky 401k’s have replaced guaranteed defined benefit pensions, and now the 1% is going after the one element of FDR’s New Deal that remains, Social Security!

Austerity as described by Webster: difficult economic conditions created by government measures to reduce a budget deficit, especially by reducing public expenditures. So what is in effect here is the Golden Rule: He who has the gold (and the pockets of Congress) makes the rules. As we point out in HEIST, in 1971 there were 175 lobbyists in D.C. but by 2008 there were more than 33,000. Because of this, Congress spends more time hobnobbing with lobbyists who represent the super rich and corporations than they do with most of their constituents, ordinary working people. The big disconnect here is that politicians believe the problems of the one percent are the problems of the country. It’s safe to say that working people have no voice in Washington.

As a result, our priorities are way out of whack as pointed out by Sen. Bernie Sanders in HEIST. -Instead of a society in which we’re struggling together to deal with this environmental crisis, to deal with education, to make sure all of our people have healthcare, we are a society now in which the goal is to be one of those people on top that have tremendous wealth and tremendous power.

By the way, did you notice as we did in HEIST that our “deficit” problems began in 2008 when the world economy tanked thanks to Wall Street’s criminal activity? But to cover their crimes, the cartel’s message machine switched into high gear, effectively convincing working Americans that they were to blame because they bought too many televisions. NO, our deficit “problems” began when Wall Street crashed our economy, people lost jobs and the government lost tax revenue, and brought back the ultimate tool of “magical thinking”?, the Reagan-Bush tax cuts. It’s maddening to hear over and over again from cable pundits, anchors and reporters make assumptions about the “deficit” without understanding its source or doing their own reporting. This is the corporate-political-financial class message machine doing its finest work. The result has been disastrous for working Americans as Jakada Imani of the Ella Baker Center for Human Rights says in HEIST.

Folks who are in charge of this economy ran red light after red light after red light, and caused car wreck after car wreck after car wreck, and no one’s held them accountable. There hasn’t even been a conversation about accountability.

So the political coup begun in the mid 1970’s by nihilistic corporations and the super rich as described in HEIST, that swept up both American political parties continues to this day. In all honesty, on matters regarding the economy it’s almost impossible to separate the Democrats from the Republicans. We sincerely hope President Obama proves us wrong. To make matters worse, the corporate owned media has helped create within the working class a sort of “learned helplessness”, that we are powerless to counter the powers that be. This country has a history of social movements, the feminist and civil rights movements, among others. We must support social movements like Occupy Wall Street, which is raising the level of consciousness about the grave inequality present in this country. Which is exactly why the corporate-political class swooped in to shut it down so quickly.

For more information about Heist: Who Stole the American Dream? please go to www.heist-themovie.com.

JeffreeB will be available for comment immediately following publication.
This entry is also available on Daily Kos.

‘Fix the Debt’ CEO Dream Team Wants You to Be as Scared as They Are of the Fiscal Cliff

2:26 pm in Uncategorized by Donald Goldmacher

Note: This entry was co-written by policymaven1 and JeffreeB

Sharp cliffs over water

Is our economy going over the brink?

Many readers of our last post about Pete Peterson’s attack on Social Security commented on a very accurate point: Social Security contributes nothing to our national debt. It is a system into which we pay; and then, eventually, it pays us. And, as we previously pointed out, the Social Security Trust Fund is in surplus. And if the Social Security Trust Fund does begin to run dry, by law, it automatically reduces benefits payments to compensate. Which raises the question: Why do Peterson and pals so badly want us to believe that in order to reduce our national deficit, we have to reduce benefits and increase eligibility age for Social Security?

Well, let’s take a look at just who exactly wants to “help” us “fix the debt.” Erskine Bowles and Alan Simpson, the budget hawks who co-chaired the Simpson-Bowles Commission at President Obama’s behest, founded the Fix the Debt campaign with a nice chunk of change from the Peter G. Peterson Foundation (which is run by Pete’s son, Michael). Fix the Debt is co-chaired and co-”steered” by an array of politicians from both sides of the aisle. At last, bipartisanship!

But there are others on the steering committee. One of these is Dave Cote, CEO of Honeywell. Cote ranked 11th on a list compiled in a recent study conducted by the Institute for Policy Studies of executives who have saved the most from the Bush tax cuts. According to the IPS, Cote’s taxable compensation for 2011 was a bit over $55 million, and he got out of paying about $2.5 million thanks to the Bush tax cuts.

Another member of the steering committee is Robert Zoellick, former Vice Chairman of Goldman Sachs. Citizens for Tax Justice reported in 2011 that Goldman Sachs claimed a $352 million Excess stock compensation deduction in 2010 and received a $123 million tax subsidy. Goldman along with 170 other companies avoided paying $2 billion in taxes from this loophole alone. And one of Goldman’s former ringleaders is now going to help us fix the debt!

Pete Peterson’s aforementioned son Michael is also on the steering committee, along with James B. Lee, Jr., vice chairman of JPMorgan Chase. And there is a sizable, ever-growing list full of other nefarious CEOs who have signed on to Fix the Debt’s CEO Fiscal Leadership Council.

This is the dream team Peterson has assembled to pull us out of this whole mess. Oddly enough, you may have noticed, the lineup looks strikingly similar to that of the team that put us in this mess in the first place.

But let’s take a moment to look at how we got here in the first place. The reality is that the current system of taxation created by Ronald Reagan and put on steroids by George W. Bush is working quite well for Peterson and his fellow oligarchs. Economist Robert Kuttner outlines the beginnings of this historic wealth transfer in our film Heist: Who Stole the American Dream?:

You had massive lobbying beginning in seventy-six, seventy-seven, seventy-eight, for cutting taxes on rich people — trickle down economics. Cut capital gains taxes, cut dividend taxes, cut income taxes, and the economy will flourish. Some of the Democrats started drinking the Kool-Aid along with the Republicans.

So in 1981 Ronald Reagan convinced Congress to pass his Economic Recovery Tax Act, which cut the top tax brackets by nearly a third but raised taxes on the middle class. What was the practical effect of this new taxation? David Cay Johnston explains in Heist:

The Washington press corps went along with the White House, calling these “revenue enhancements.” By dramatically increasing the social security tax, as recommended by Alan Greenspan to Ronald Reagan, we shifted the burden of government, so that today, seventy some percent of Americans pay a heavier share of their income in Social Security and Medicare taxes than they do in income taxes, and we pushed the burden down. At the same time at the very, very top we radically cut taxes so that the 1,000 richest men, women, and children in America face an effective total federal tax rate — social security and income taxes — of about 17 cents on the dollar, and their average income is 263 million dollars.

Let’s be very clear, Peterson and his gang are fixated on the debt because they don’t want to pay their fair share of taxes! And now, we supposedly sit on the edge of the cliff, below which yet another financial mess awaits. And Peterson and pals claim to have the solution. Sound familiar? Maintaining the Reagan-Bush tax cuts is the number one goal of today’s ultra-conservative movement that has been in control of these United States since the late 1970s.

The way to peddle it to the American people? Beat the drum of debt reduction through the mainstream media megaphone. All of this is to obscure the real truth, which is that our debt is the direct result of the severe economic downturn, the continued failure of big corporations to pay their taxes on profits sitting offshore, the huge bank bailouts (paid for by you and me), and two wars fought on credit.

Up next on the Peter G. Peterson chopping block? Your Social Security and Medicare!

Note: JeffreeB will be available for comment after publication.

This entry is also available at Huffington Post and Daily Kos.

Photo: m.prinke on Flickr under a Creative Commons Share-Alike license