GOP hypocrisy over Bush vs. payroll tax cuts

http://news.yahoo.com/gop-may-ok-tax-increase-obama-hopes-block-124016578.html




Un-freaking-believable GOP hypocrisy over taxes and debt. Bush tax cuts (over 90% of them benefit the wealthy) set to expire - hold the nation hostage until they're extended, even if it drastically increases the national debt. Payroll tax holiday set to expire (that mostly helps the working poor and middle class, and has a smaller impact on the debt since its tied to future Social Security benefits), no way Jose. But of course this in no way means that the GOP is complicit in a tax increase (they signed the Grover Norquist pledge and all), yet that is precisely what they called the potential expiration of the Bush tax cuts. I think the problem is I'm not a multi-millionaire, otherwise this all would make perfect, consistent sense.



All we hear about from DC is "jobs, jobs, jobs," but nothing's happening. To be honest, neither the Bush nor payroll tax breaks can spur much job growth, but at least lower payroll tax on workers will give them more purchasing power at a time when consumer demand and our overall economy are wobbly. And their consumption will help preserve other jobs. Many companies are sitting on piles of cash but refusing to hire, and the long-term unemployed in America don't generally fit the profile that employers are seeking. It's always supply-side thinking with the GOP: cut business taxes and you magically get more jobs and prosperity. But firms have no obligation to use the tax rebates on hiring (unless Washington crafts the law as such, which they can do but won't), and frankly it may not be the wisest use of the money at this time for many firms. Remember that Paulson convinced Congress to give the big banks a huge cash infusion (the now famous 1-page bill with no strings attached) to spur consumer lending, but after that credit actually got tighter and the banks tended to use the money to snatch up other distressed banks at fire-sale prices. So if jobs are the ultimate goal of all this tax cut talk (and not simply profit-taking), they're going at it all wrong.



Observing the trends in 2011, I can't come up with a plausible explanation other than the Republicans are committed to blocking gov't progress and economic growth (for the bottom 95% of us), and any attempts by the president to encourage them, in order to make him look inept as the election approaches. And of course they'll blame him for the economic woes that they mostly created. Surely Obama is not helping his cause much, but from my perspective only one political party has shown that it is willing to sabotage this country (and the entire global economy by extension) simply to win some offices. I think we have a place for dangerous threats like that: Gitmo. The Tea Party freshmen are hurting this country more than Osama's driver ever did or could.



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And if you have time, try to check out "Inside Job" and "The Conspirator" recently out on DVD/on-demand. The former is an Oscar-winning documentary about the financial crisis. Most of the material is known to us by now, but the director also explores a different angle: how some top academic economists (funded by big banks and industry groups) promoted over-confidence in de-regulation and risky investment vehicles with their biased publications and lectures. This helped gov't to turn a blind eye, ratings agencies to inflate their scores, and investors to over-spend on risky securities. And the film also captures the Columbia Business School dean and other ex-Bushies looking really silly.



The latter is a Redford film about the outrageously inappropriate trial of Mary Surratt, an indirect acquaintance of J W Booth who was accused and eventually hung for conspiring to kill Lincoln. While not well received by the critics, it's an interesting examination of a dark chapter of US history that we don't learn about in school. Her trial demonstrated how war hysteria and political pressures will make even the highest offices in the land more than willing to trample on the Constitution and our most sacred values. A horrible crime was committed, and in order to "heal, move on, and maintain order and security", the guilty must be swiftly "brought to justice" (as in, whacked). And if no one fits the legal definition of guilty, then we'll manufacture someone and change the definition. Those who protest will have their reputations destroyed and patriotism questioned. This is especially pertinent as we're approaching the 10th anniversary of 9/11.

Jerks make more money, nice guys finish last?

http://www.huffingtonpost.com/2011/08/16/nice-women-finish-last-work_n_928207.html


http://www.kqed.org/a/forum/R201108190900



Most of us implicitly feel or observe this, but a team of business professors recent published a paper showing data that being more disagreeable at work is correlated with higher pay (especially for males, supposedly in order to fit the dominant, aggressive gender role), when controlling for industry, worker age, timing, and job level. "Agreeable" people are characterized by 6 facets: trust, compliance, altruism, straightforwardness, modesty, tender-mindedness, so I guess disagreeble would be opposite. A person 1 SD more disagreeable than the mean of their data set made on average $10K/18% more than a person 1 SD more agreeable than the mean. I believe the data was collected by self and peer reported surveys, so they're not fully objective and quantitative.



But this type of disagreeable personality is also correlated with less success in relationships, more stress, and generally less life satisfaction. And as you would expect, the "jerks" are less likely to manage others and receive promotions they are qualified for; they only seem good at negotiating raises. They are also fired more often, but find new jobs quicker. We know that women and minorities unfairly trail white men in terms of compensation, and the "advantage" for being disagreeable is diminished for them (probably due to backlash over the stereotypes of being a bitch or an uppity minority).



But this is a paradox. Jerks only succeed if they can differentiate themselves from and take advantage of nicer, more submissive coworkers. A company entirely staffed by jerks would likely fail. And if a nice guy reads this study and wants to get meaner in order to make more money, the rapid temperament change would probably be met with negative reactions. That person would lose the capital he has accumulated from being nice, and his "forced jerkiness" would probably be interpreted as phony or weak by his true jerk peers. And of course there are many other ways to try to get recognized and make more money at work besides being meaner. Though there's no guarantee that any of these measures will bear fruit; it depends on your org, bosses, economy, etc.



One hybrid solution is to be a jerk at work and nice in your personal life, but most of us know that it's hard to wear multiple hats and keep separate personalities totally separate. Plus salary is not the only measure of a person's worth and life satisfaction. We would probably agree that the most talented actors and artists are not the highest paid, and being a jerk and "winning" all the time isn't the last word for life (and clearly it costs you in other areas). Or if that is all you need to be happy, you probably have bigger problems.



Of course this stuff is just the tip of the iceberg and it's an age-old labor issue, or human social issue in general. We know that the workplace is generally a harsh, soul-crushing hell, and getting more so with time and economic pressures. We have to get mean at times to avoid being a doormat. Maybe it's all about picking our spots, and fighting when it will pay off most.

Shooting down the GOP argument against taxes

Very good discussion about the recent stock market volatility and tax reform (even the listeners calling in are pretty sharp, except the last one):




http://www.kqed.org/a/forum/R201108050900



The economists on the program (not liberal wackos) pretty much obliterate the GOP argument against any new revenue generation as part of a bigger plan to reduce national debt and put us on a better economic trajectory. The "educated people's" general strategy for economic recovery is like the opposite of the Tea Party's: increase short-term gov't spending (for infrastructure and other helpful investments), increase exports, and reform taxes (which will pay for that spending and also cut into our debt). And of course Warren Buffet, the poster child of all the positives of our free market, thinks taxes on high earners are too low as well. Taxing the incomes of the rich may discourage hard work and innovation to some extent (but not like the USSR), though there's little evidence that it's a net loss for society, especially considering all the good we could do with the extra revenue (even in the hands of inefficient Uncle Sam). It's true that the rich currently pay a disproportionate % of total income taxes, but that's how it's supposed to be. They also hold a disproportionate % of total national wealth, and that % is growing a lot faster than their tax outlays.



I don't know what is the deal with the GOP and taxes. They pay their country club fees, their PTA dues, and AMEX black memberships, don't they? We have to pay for the services and benefits we enjoy, right? Even if their vision of small gov't materializes, some private (profit seeking) firms will have to step in to meet the social demand for safety, conveniences, etc. If the rich aren't paying gov't for that stuff, then they'll have to pay Acme Corp. that may not have the customer's best interests at heart. Based on the track record, I would mostly prefer public service providers. The USDA and NPS have screwed over far fewer Americans over the years than Enron and Countrywide. We can't expect to live in a first world nation funded at third world levels.



Apart from raising some income taxes, ending some tax deductions is crucial. The mortgage interest deduction is the biggest culprit. I regret that I use it, but I wouldn't mind to see it disappear in a package of smart reforms. The interest deduction (and most itemized deductions in fact) just benefits select industries, political interests, and the rich at the expense of other national needs. The wealthy can hire accountants to best exploit the tax laws, and the more they spend, the more they get back (which encourages frivolous over-consumption and bubble creation). Many lower earning, less educated Americans are ignorant on some ways they could reduce their tax burden, and have trouble navigating our ridiculously complex tax code.



Does it make sense that the federal limit on full interest deduction for a married-filing-jointly couple is a mortgage of $1M? That's nuts, especially when the US median home price in 2010 was $185K. And you can even deduct on a second home that isn't heavily rented out. Those folks don't need a tax break. In general, affordable home ownership is good for our society, but of course it's not for everyone's budget. I could accept a meager interest deduction scaled vs. one's adjusted gross income and local median home price, but no way for entire jumbo loans, withdrawing equity to play the market, and any high earner. The rich are the last people who need rewards for purchasing stuff. Otherwise it incentivizes over-leveraging and buying too much real estate for one's budget. If the rich want a sweet crib, then why not pay more cash down rather than getting a reward for borrowing a huge sum? And now interest rates are very low (if your FICO score grants you access to credit), so it's not like interest is killing the average fixed-rate homeowner (assuming old mortgages can re-fi). The mortgage interest deduction is costing the US (that means you and I) about $90B/year. That's pretty much the size of spending cuts over 10 years that Obama-Boehner agreed to last week. Sure the real estate and banking industries would take a hit from this change, and maybe home prices would dip, but all that extra revenue could keep more people working/spending, and investments in infrastructure will yield future returns for everyone. It's better than a hand-out to upper-middle-class and rich homeowners.



http://www.irs.gov/publications/p936/ar02.html

http://www.washingtonpost.com/wp-dyn/content/article/2011/01/21/AR2011012102256.html



Unfortunately a lot of schedule A deductions follow this pattern: a net loss for America. This is also somewhat true for educational incentives. America just doesn't get the most bang for buck by helping people attend college, sorry Dems. It's something people are going to do anyway, so why encourage it? And for those who aren't ready for college but get suckered in by shady Univ. Phoenix recruiters, they are going to drop out saddled with tuition debt, which hurts everyone but Phoenix. I know education is an investment and cultural priority, but probably our K-12 system needs the help more. Yes colleges are getting pricier and more competitive, but why credit families making more than $100K/year? If they care about their kids' futures, they will save money for school instead of taking another trip to Maui. As you can see, the poor aren't the only ones depending on "gov't handouts". I fully believe that the qualified poor should get education assistance to help climb the ladder, but deductions for the middle class are not the best use of funds (though mortgage interest is still way worse than this).



And maybe we as a country are just consuming too much, and should save better to take pressure off some gov't services. China's economy is growing like gangbusters, yet the gov't:consumer spending ratio is much higher than ours. This won't last forever, and of course China is an exports economy, but it just shows that it's possible. Taxes always lower total economic efficiency ("deadweight loss"), but some revenues are necessary so we can have a civilization. And some taxes hurt more than others. We should be taxing consumption, not production. Many economists feel that the value-added tax is the best way to go. It's not that different, and theoretically generates the same revenue as sales tax, but creates less distortion in incentives. Firms only pay tax on the gross margin or "added value" of their output (sales minus costs of production) and get tax breaks on exports, while the end-user pays VAT on the purchase price of the goods/services. So the system doesn't unfairly punish producers, and encourages consumers to buy more responsibly. It is not perfect, and there are some regressive elements to it, but maybe the poor (who still need to buy some stuff) could be compensated by lower income taxes and subsidies on essentials.



http://en.wikipedia.org/wiki/Value_added_tax



But the problem is, all these tax arguments can make perfect logical and economic sense (and be fully constitutional), but if they conflict with the conservative ideology of the role of taxes in our culture, then they are political non-starters. Obama has mentioned tax reform in his speech today and during his 2011 SOU address, but we probably won't do anything about it. It's like racism, seriously. You can date the nicest, cutest, smartest, most honorable black man in the world, but your parents still won't approve when you bring him home. Heck a racist could be trapped in a burning building, and refuse to be saved by a black firefighter. That's what the GOP is like, totally irrational. It just doesn't make sense to unconditionally reject something that can be good (or at least necessary) for our survival.

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Sorry, just had to add this:




Check out these idiotic news headlines (attachment). The press is suggesting (maybe inadvertently) that Monday's terrible stock losses are totally due to the S&P downgrade. This is ridiculous for several reasons, but I'm sure the deficit-hawks in the GOP will jump all over this crap and twist its meaning. First, if US debt is somehow less safe now, then why has the yield dropped again as investors are dumping stocks in favor of US bonds (and gold)? That shows the people with the money don't care about what S&P did. Second, Moody's and Fitch didn't agree with S&P's rating (and neither did Warren Buffet), so it's possible that S&P are flat wrong. Third, no credible entity should care how the ratings agencies score them anyway (who the hell cares if we are AAA or AA+, especially when those ratings aren't quantitative and both are still very good?). Ratings are less and less important as pension funds and other big investors rely on their own research. Lastly, this S&P downgrade was not a surprise. They were pretty much "threatening" to do this weeks ago unless the gov't could agree on $4T in cuts (which is a tall order). So why didn't the markets react then?



http://finance.yahoo.com/news/Dow-plunges-more-than-634-apf-1960115615.html?x=0

"The market is under a lot of stress that really has little to do with the downgrade." - $20B bond fund manager

If this is so, then Yahoo! picked horribly misleading headlines, and unfortunately headlines may be all that some readers see.



Correlation doesn't prove causation. The markets were headed down today even if S&P did nothing. The downgrade surely didn't help make anyone feel better, but it's our stalled economic recovery and worries about Europe that are fueling most of the losses. Probably investors are more concerned about Washington's inability to enact changes and react constructively and swiftly to crises more than our actual debt numbers.



So the Tea Party should think about that too if they truly love this country. Or do you think the GOP obstructionism and ultimatums are deliberately designed to tank the US economy leading up to the 2012 election? Then they will try to pin our troubles on the Dems and retake the WH. Because our economy will eventually improve of course, and they don't want to allow Obama to take credit (it's bad enough that the guy took down Osama). So if Obama isn't an idiot, he has to stop playing nice and call out the GOP on this, and I think many sensible voters will side with him. If GOPers are scared to raise taxes and face voter anger, they should also fear losing their jobs if they fail to accomplish anything, or worse block efforts to help the American people.



I know this theory sounds horrible, but it wouldn't be the first time. There was an investigation into whether the Reagan campaign worked with the Pentagon to delay the Iran hostage crisis resolution until after he beat Carter in the 1980 election, so Jimmy couldn't get credit for it. A gov't investigation later refuted the claim, but many high-level people still believe it, and the facts of the case are quite intriguing.



http://en.wikipedia.org/wiki/October_surprise_conspiracy_theory
 
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http://fivethirtyeight.blogs.nytimes.com/2011/08/08/why-s-p-s-ratings-are-substandard-and-porous/?hp






Clearly the S&P rating has SOMETHING to do with the market. There are plenty of non savvy investors in the marketplace to make that effect happen.





Also I take issue with this housing tax break allowance. Of course i own an expensive home so this is near and dear to me but as a rich person who works for my income i essentially have 1 tax break which is my home. Without the interest writeoff I would be claiming zero and paying extra every month to avoid a fine for not putting enough away for taxes. Champagne problems maybe but in an area whose average housing cost is somewhere between 300k - 500k is getting the total jumbo loan as a write off a crime?





On a somewhat separate note, how can you eliminate that writeoff without screwing the people who already own homes? The price of a home has priced in the fact that people get a discount on mortgages and if a lack of writeoffs makes homes less affordable prices will reflect that by dropping. So folks with mortgages would be less able to pay for them and go underwater as a result. So implementation would certainly be an issue.





I do understand this is a writeoff that mostly benefits the rich but this is one of those things where certain areas of the country (read LA/NYC/MIA/ETC) have plenty of "rich" people who couldn't be homeowners near their place of employment otherwise.
 
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Regarding the S&P downgrade and the market drop, sure there were some knee-jerk, ignorant investors who got spooked by the news, but I'm not sure how much they contributed to the overall decline. Maybe US debt is less attractive now, but it's still the best game in town, so people were more worried about stocks/overall economy and fled to bonds/gold. So maybe S&P warned us that the well water has some bacteria in it, but we're thirsty as hell and it's better than drinking piss.




It's funny how the blogger is saying it may be profitable to bet against S&P over its sovereign debt ratings. Historically, when S&P downgraded sov. debt from AAA to AA+, the yields on those 10-yr bonds tended to go down over the next month (as we saw with the US yesterday). This may be due to other economic events coinciding with a country under debt stress, but no industrialized nation downgraded by S&P has ever defaulted afterward, and investors seemed to pay no heed to the lower ratings.



http://www.businessinsider.com/average-yield-impact-of-a-lost-aaa-rating-2011-7



The link below describes how 90% of subprime securities that Moody's/S&P rated AAA pre-bust were later shifted to junk status. Is anyone in MLB batting .100 and keeping their job? Some of the big banks are being investigated for pressuring the ratings agencies to raise the grades of some of their securities. In some cases, bank execs called into those agencies to complain, and after some wrangling/bribes/threats, the agencies made exceptions to their risk assessment standards so the securities could be rated higher. That's like Michael Bay calling into Rogert Ebert's office and wiring him some cash to sweeten his nasty review of the latest Transformers slop. Maybe instead of relying on the big 3 agencies tainted by conflict of interest, we could have a crowd-sourced service from vetted financially-savvy contributors, similar to a Wikipedia or Yelp? I know there is plenty of independent investment advice out there, but something a little more official and trustworthy could help. Maybe it already exists?



http://www.bloomberg.com/news/2011-04-13/moody-s-s-p-caved-to-mortgage-pressure-by-goldman-ubs-levin-report-says.html



Regarding the mortgage interest deduction, sorry I didn't clarify before but any changes wouldn't be retroactive to existing mortgages. They would have to be grandfathered in or have the deduction withdrawn gradually. I know how you feel though. We obey the law, work hard, and haven't withdrawn much from the system (we haven't taken any unemployment, welfare, disability, etc.). Where's our damn reward for being good soldiers? But that's the thing, in a compassionate society the able have to sacrifice more for the less able. Is it "fair"? Well that's another discussion, but people like us really don't need any tax handouts, even if we're not living large and many of our neighbors seem to be doing a lot better (in their cases, even less justification to help them). I'd rather a handicapped person still get her home care, or a veteran get his physical therapy, instead of me getting a deduction. Of course I'd rather all the normal people get more help and the rich pay more into the system, so I'd fight harder for Bush tax cuts repeal before I fight for mortgage interest deduction repeal. Also, if we reformed other aspects of the tax code and labor market, you wouldn't need the extra money from deductions anyway.



The interest deduction is supposedly meant to make home-ownership more affordable and encourage people to do it. You and I bought during a time of really low rates, and even fed/state tax credits for first-timers. If interest deduction is the last bit of help a person needs to get over the hump and afford a mortgage, then maybe that person isn't ready to own. For your family and mine, we wanted a place of our own and our lifestyles/finances permitted it, so we would probably buy with or without the tax break. It's like Cash for Clunkers - the wealthy mostly took advantage of it, and in fact the program unintentionally put upward price pressure on the used car market (by destroying some supply), which hurt poor people who can only afford bad used cars. Like I said though, I could support a partial interest deduction adjusted for income/location, but not as generous as the current program. The bigger problem is expensive real-estate in the big coastal markets as you said, but that is a whole other can of worms that I don't know how to address.
 
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Yes!  MY point for the last 30 years with regards to 401Ks, etc.  I HAVE NO IDEA what to do with my money, but ever since that asshole reagan came along with the 'you know best how to invest your money' line of bullshit, I've HAD to put my money into the market. the ones who convinced us that this was for the best, certainly knew what to do with our pensions-line their own pockets with OUR savings.  They then burned me on the 401K bullshit, too.  So, now, once again, it's my fault for not knowing what to do.  I'm with the folks in the streets in london at this point.  burn, baby burn.
 
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Yes I'm frustrated and pissed off too. Our money is going poof (not that I had much to begin with). We can't compete with the resources and power of Wall Street investors, and we're not rich enough to hire them. So unless we have a crystal ball, the best we can do is diversify and let it sit. A mix of industries, company types, funds, bonds, commodities, and some liquid cash for quick emergencies. But others on this list know much more about finance and investing than I do, so please chime in and help us.




In general, the US stock market has been a very good and safe bet since WWII, and T-bonds even better. There will be shitty days and scams of course, but in the long run our investments should appreciate better than real estate or CDs (unless the 21st Century economy is vastly different than history). But of course an individual has to tailor his or her investments for their risk tolerance, values, and life circumstances.



I don't know about all the circumstances going on in England now, but it seems like the Rodney King riots. I just think it's sad when trouble-makers destroy property and wreak havoc only in poor neighborhoods. People have every right to protest and show their anger. So if they want to break the law, torch Harrod's and 10 Downing Street, not the poor immigrant flats of people on the margins who never did wrong to anyone. And Harrod's is insured anyway, though of course it is more protected by security forces than the slums.

Obama surrendered to the GOP on the debt issue

http://www.nytimes.com/2011/08/01/opinion/the-president-surrenders-on-debt-ceiling.html?_r=1&hp


http://www.kqed.org/a/forum/R201108020900



This debt bill doesn't have much to celebrate, but it's especially repugnant for progressives. There isn't a single cent of revenue generation, not even closing the corporate jet tax loophole (that Obama mocked in his debt speech) which would have just netted a few million/year and affected a tiny fraction of our population. He couldn't even get that. I know politically Obama is weakened and the debt issue is not all his fault. We're still paying off Reagan and Bush borrowing, and the stimulus was necessary to avoid a depression, yet the conservatives only want to tighten the belt now, when the economy is quite fragile and dependent on a healthy consumer sector (and gov't spending for that matter). While economists predict that these spending cuts (which won't take effect until 2013) won't hurt the economy much, it does lower consumer-investor confidence, and the rest of the world is wondering what the hell is wrong with Washington (and let's not underestimate what this ding to our reputation will cost us in the future, see Iraq). All that will impair an already sluggish recovery, and won't help create jobs.



Like his caving on the Bush Tax Cuts, Obama was in a tough situation though - the GOP knows that the buck stops with him and he doesn't want to preside over a gov't default. The GOP and especially the TP don't care if they wreck DC (and by extension, the US people whom they claim to represent). So it's like a parent bargaining with her child holding a family heirloom watch over the toilet bowl. The watch means a lot to the parent and nothing to the child. He is giggling and thinks it's a fun game to see the parent (an authority figure) panic and plead. The parent is at a major negotiating disadvantage. And yes, Biden was right, technically it's terrorism. When you control something precious to the other side, and threaten to harm it unless you get what you want, what else do you call that? I suppose Wall Street calls it "business as usual." But that worries me - will this become business as usual? We don't negotiate with (Islamic) terrorists because we don't want to send the message that their brutal methods will actually work to accomplish their goals. But now that Obama has caved on several occasions, the ultra-right/TP are only getting bolder with their demands. They see it works, and now every damn budget/spending debate from now on will probably involve this type of ludicrous brinksmanship, posturing, and blackmail (at least until the Dems lose the White House).



Some pissed off liberals think that Obama should have let the nation default, to show the people what the GOP wants and let them take the heat for America's suffering. But like the bank bailouts, he chose the lesser of two evils (moral hazard vs. financial freeze). He is a risk-averse president, and would rather compromise with the GOP than put the nation under unnecessary stress. Maybe that is a prudent decision, but at some point we have to put our foot down. He can't lead the nation being on the defensive all the time. Obama may have avoided a catastrophe this week, but it's not helping his re-election chances and it was a betrayal to his party's philosophy.



Instead, Obama could have raised the debt limit without Congressional involvement (as Bill Clinton recommended) and let the GOP try to take the issue to court. At least the gov't would still run and we'd be paying off our obligations in the meantime. All the panic about debt Armageddon was kind of misleading; sure it would be catastrophic if the US defaults, but that wouldn't happen. We have the funds to pay off our obligations, maybe at the expense of other federal spending, but we won't be deadbeats. As sad as it is, our debt/GDP ratio is still pretty comfortable (lower than France's and the UK's). Italy is one of the biggest economies in the world and their ratio is double ours (http://en.wikipedia.org/wiki/List_of_sovereign_states_by_public_debt). US debt is still one of the safest investments in history, so who cares if S&P threatens to downgrade us? Those were the same morons that gave sub-prime mortgage securities AAA ratings. The Euro has bigger problems, Japan's economy is gloomy, China isn't trustworthy, the stock market and commercial paper can be volatile, and some commodities have issues too. Where would you put your millions for safety? During this big debt debate, what happened to the yield on the 10-year T-bond? It actually went down (to ~2% now), meaning that investors are finding it more desirable vs. other similar investments. Demand for US debt is increasing, so the world is still very confident in us. In comparison, Greek 10-year bonds are paying out around 25% if you dare to sink your money there.



This bill creates a Congressional commission to decide how to make the remaining $1.5T cuts over the next few years. But how can we expect that such a group would show more cooperation than what we've seen? What if that group doesn't come to an agreement? An across-the-board gov't spending cut (not sure the %), including entitlements. I guess that is exactly what the GOP is hoping for, so the conservatives on the commission really have no incentive to compromise on any liberal initiatives. They now have the luxury to wait out the Dems because they are not scared of the fallback plan. Either they get everything they want, or they still get a pretty good outcome if the talks fail. No harm can come to them, except from possible voter ire in 2012, but there's plenty of that for the Dems too. I can't believe Obama agreed to all this.
 
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Obama's actions here are only surprising if you think he's a liberal. He isn't. He's a moderate conservative. He gives liberal-sounding speeches to establish his credentials, but his actions are moderately conservative. He's largely continued W's wars, and started a few of his own. He kept W's defense secretary and a bunch of the economic advisers (imagine FDR keeping Andrew Mellon). Gitmo. His health care plan rejected single payer and instead followed the template you can trace back through Romneycare to the Heritage Foundation's initial 1989 mandate + subsidies solution. He's gone after whistleblowers even harder than W. His opening offer in the manufactured debt ceiling crisis included big cuts to social security and medicare (which for a long time have been how you identify that someone is a Democrat at all).






And he's on track to raise a billion dollars, mostly from rich businessmen. Do you think they'd be paying huge amounts of money if they thought he was failing? He's doing exactly what he's supposed to do. Even early on he was telling people that the long-term goal was to cut social security - his aides explained this to David Brooks back in March 09: http://www.nytimes.com/2009/03/06/opinion/06brooks.html ("He is extremely committed to entitlement reform and is plotting politically feasible ways to reduce Social Security as well as health spending."). He's looking to be a sort of reverse "Nixon goes to China": the ostensibly indisputable liberal who because of those liberal credentials can be trusted to negotiate a fair deal to cut the left's core programs, and thus becomes the transformational politician who brings left and right together to do what's needed. In these debt negotiations he's not getting out-maneuvered, he's Br'er Rabbit saying "please don't throw me into the briar patch!"





The only real hope for the left is a solid primary challenge, to force a change in the dialogue, because the Bachmann bogey-man will guarantee no third party candidate affects the outcome. The current hope-and-prayer is Elizabeth Warren, even though no one seems to know where she stands on anything other than the economy.
 
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Obama is one of them. This is what he wanted, too. Get over it.


Try this on:



http://www.yourownhealthandfitness.org/blogs/?p=288



There is no debt crisis. We've been gutted like a flounder.
 
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Thanks, friends. Yes it may be true that Obama is not a liberal, but how the F did he convince the Dem Senate majority and at least a few dozen Dems in the House to approve this bill? What were Reid and Pelosi's roles in this? Apparently Obama's horrible at persuading conservatives, but great at keeping the Dems in line. The liberal wing of the House may have revolted but were powerless to stop it, though you'd think a few committed senators could have filibustered? Or they don't want to take the blame for missing the deadline?




Obama has clearly picked his backers (or vice versa), but what if he doesn't win? Despite lining Obama's coffers, corporate interests would prefer a GOP in the White House (even if there's not much difference with an Obama admin.), and they are ready to sign new checks for whoever emerges out of the GOP primary. By making deals with the devil, doesn't Obama worry he may get screwed? I'm not so confident about his re-election chances after all this, and there are more budget battles to come before next Nov. The US public doesn't seem to be very sympathetic to Obama over these shameful impasses, so what the hell is he getting out of all these concessions, politically?



Look, I understand the TP attitude. They think DC has overstepped its mandate and is spending out of control. They feel the need to block Dem initiatives tooth & nail, and hopefully they can roll back some gov't expansions for our own good. Forget their economic ignorance and political inflexibility, but I can understand why they would be motivated to subvert the gov't to serve their own interests and save the country. If I was a congressman during the W Bush years, I would feel the same way. It would be like de-funding the Iraq War to protest the immorality-irresponsibility of it. Dems would have been skewered for attemtping such a move in 2005, yet this debt blackmail is somehow OK? And stopping Iraq would save lives, but freezing the gov't is costing lives.



Obama was elected by a pretty big margin because America thought he could bring people together. Well he hasn't, and it's probably gotten worse. It's not all his fault, but if he is failing precisely in the area that he was supposed to excel in, what are the voters (especially Dems) to do about it in 2012? You think anyone would dare to challenge him from the left? Maybe the hopey-changey stuff was all BS, and he's not interested in forging relations and working with others. But he's not dumb; after a few months on the job he should have seen that the GOP and others weren't willing to work with him either on most of his "official agenda." Maybe he needed to play nice to get (minimal) health care reform passed, but that's a pretty crappy legacy to hang one's hat on. Why did he invest so much in that area, and totally fold on other critical issues like jobs and revenue?



Why the hell does he still try to work with the right after 2+ years? It's a divided gov't now and the Dems may take more of a beating in 2012. Why not try to get as much stuff done while you can? He's still the freaking president. Use executive orders and circumvent the checks and balances like Bush did. But as you said, I guess he's not interested in that. Though you'd think Pelosi and Reid wouldn't just sit idly by while Obama pisses away the rest of his term. Reid almost lost (to a total joke candidate) last election. They have a lot riding on this next year, what the hell? What is the Dems' strategy?

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Pelosi is the only reason things weren't worse, and she's clearly not
a big Obama fan at this point. In fact, Obama would have backed off of
that watered-down healthcare bill without her. These are trying times
for the "left," but it would be a good idea to invest in a few more
behind-the-scenes operators (even though she plays the good soldier in
public) like her.

http://www.thedailybeast.com/articles/2011/08/01/nancy-pelosi-takes-gutsy-stand-backs-disliked-obama-boehner-debt-deal.html

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Thx, S. The Prodigal Son has returned! That's interesting about Pelosi and Obama's desire to distance himself from her to not be perceived as a liberal. But these days, only FNC is accusing Obama of being one of those. I guess the best thing for Pelosi's career is to be a good soldier, help Obama get re-elected, and reclaim the House so she can become Speaker again. If she led a revolt from the left over the debt and other issues, I don't know what that would do to the country and the Dems, but it probably wouldn't help them in 2012. Though the TP is forcing the mainstream GOP to change, so why can't the progressive wing put pressure on Obama? If the GOP alternatives weren't so damn scary, I would hope for Obama to lose so he learns his lesson about picking the right backers and mistreating allies. And I do appreciate Pelosi putting her foot down on some issues so the debt package wasn't worse. She should bring that stuff to light so Americans can see that some people in DC are still trying to fight for them. A tell-all book 3 years later won't help.

J's link to the Brooks piece is pretty depressing too. I know centrists win the presidency, and a big chunk of Obama's support in 2008 was from middle-of-the-road or slightly-right folks. But if his agenda all along was to cut entitlements, benefits, and worker's rights, then what's the point of running for the goddam Democratic ticket? Some cutting may be necessary, but not right now, and especially with so many sources of untapped, fair revenue. And of course when you cut that spending in a recession, it has a magnifying effect in our consumer economy. Aid recipients have less money to inject back into the system, and we're talking about food and rent here, not Vuitton purses and shares of Apple. How do more broke, desperate people help our country recover? And they were some of the most marginalized, vulnerable Americans to begin with, which is why they were getting help. Sure there is some abuse going on, but it pales in comparison to tax cheating by the rich. Though it's easier to demonize the "welfare mom" than Ford. 

Of course a black man has no chance to win the GOP primary, but why the hell did Obama declare himself a Dem? He voted like a Dem when he was in the Senate at least, maybe just to make powerful friends like Reid and Biden? I just don't get what Obama wants out of all this. He was young and a Senate baby when he ran for president, it's not like there was urgency. Unlike the Clintons, he was already rich upon entering the WH. Sure there's always the lust for power, but why go through all the pain of the office when you're just going to be Mr. Status Quo and Don't Rock the Boat? Dozens of politicians can do that already - he was supposed to be the "game changer." His hair went gray like his predecessors, so clearly he's working hard on something. Just wish the non-rich American people had more to show for it.

L's link sends a powerful message, and it's what we were discussing here in the past. We know how big-business libertarians are bankrolling the TP, and the Dems are dumping labor in favor of corporate campaign support. We know about the great wealth divergence since the Carter admin. We know that the rich were barely scathed in the recent recession, while the poor-to-middle have given back much of their gains from the bubble '90s. The labor market is horrible. In the 1930s, we had the New Deal to jump-start the economy, but many critics say the Obama stimulus was actually too small to be effective. The Supreme Court is the most business-friendly in generations. The US worker is now pushed harder than his/her peers in all other developed nations maybe besides South Korea (and their economy is booming compared to ours). Now the US worker is so fearful for his/her economic future and with very little leverage in the market, that he/she will put up with just about anything to keep the paycheck coming. That's looking closer and closer to the Industrial Revolution, minus the black-lung and child labor.

I am so angry and ashamed of our country and our people, but unfortunately I am part of the 60% that doesn't want to feel bad about my inaction. Actually, I am kind of hoping for things to get so bad that the citizens have no choice but to rise up. It's time the rich assholes feel a little fear and pain like the rest of us. It's not class warfare, it's survival.