Fact-esque

The First Step Toward Killing SocSec?

The "We can't afford it!" crowd of conservatives, Pub and Dem, have apparently won the first round in their War on Social Security. For the first time in 34 years, there will likely be no cost-of-living adjustment (COLA). With inflation currently in negative numbers, that may not sound like much of a hit but there are a couple of things to consider. First, food prices are going up above the inflation level, and energy prices, while lower than last year (the biggest reason the inflation level is considered low), are still pretty goddam high for people on a fixed income and projections are that energy prices won't stay depressed through the winter. Those are two of the biggest three expenses seniors face. The third, of course, is health care, and the biggest chunk of their health care expenses is drugs. Thanks to Medicare Part D, they're going to be paying more out of their pockets for those drugs.

Joining the Great Ponzi Scheme!

My son just got his first paycheck.  He paid $8.37 into Social Security and $1.97 into Medicare.   I asked him how he felt to pay into Social Security for the first time.  "Cheated!" he said.  He was kidding.  He's a good boy and I'm very proud of my working class guy. 

Doesn't Do Much Good to Cut Expenses When You've Got No Income

Has anyone else noticed that for all the trouble we're in we haven't had much in the way of revenue enhancement proposals? An extra 3% on the richest of us and that's about it. David Brooks is crowing about Obama "prowling around the White House prodding his staff to find budget cuts." What budget cuts? Why, Medicare and SocSec of course. What else?

Everyone is looking at the deficit and screaming about cuts. No one is looking at the deficits and screaming about the need to raise corporate taxes. President Obama did (if you can believe he was serious) make a strong pitch for closing some major loopholes in corporate tax law that would largely make offshore tax shelters pointless, and about time, too. But the BD/GOP Alliance seems to have buried that one under the compost heap in somebody's back yard, probably Barney Frank's.

Given that history - recent history included (Clinton anyone?) - shows that the economy grows when corporate taxes and the minimum wage go up, why aren't both of those the center of the Admin's economic plan? Why are we still talking only in terms of tax cuts and program cuts and budget cuts? Why are we willing to strip seniors of their security to pay off crooked bankers? Why are we still talking about the kind of tax policy that has failed - twice in the last 25 yrs - to create an economy that is good for all sectors of society, not just the rich?

Or did I just answer my own question?

Ronald Reagan isn't dead. He's running Obama's recovery team.

Obama Has Faith Tinkerbell Will Get Better If We All Clap Hard Enough

Yesterday I wrote about the carefully-couched offer of the major health insurance industry reps to cut 1.5% of their costs. I suggested that it was hooey. President Obama, however, got up in front of cameras at almost the same moment I was dismissing their lies empty promises "proposal" and told the world their proposal was the key to health reform in the US, or words to that effect. Even for WaPo Beltway stenographer Ceci Connelly, this was a bit much.

In his quest to transform American health care, President Obama appeared yesterday to put his faith in pledges from some of the interest groups that helped scuttle reform 15 years ago, but the industry's promises fell well short of the White House's expansive claims.

Ther chance that anything these convicted liars say may actually happen are lower than the chance that your pet goldfish will write a best-selling novel but that hasn't stopped Obama from assuming it. He has "faith" - always a dangerous strategy with hungry sharks.

What this actually seems to be is a concerted effort to convince everyone that the usual Kabuki actually has some substance this time, but of course it doesn't so all they've managed to do is put a sizable chunk of their credibility on a horse and send it galloping into the sunset. Which could be a good thing.

"All Roads Lead to Tax Reform" Says Rahm, But Whose?

Which taxes and who gets reformed? A couple of mild attempts to close corporate tax loopholes have stalled after counter-attacks by corporate lobbyists, and the Democrat Congress is all flummoxed because while it wants to approve Obama's popular agenda, it doesn't want to have to press its corporate donors for the money. So they're all, like, "We've got no options and we don't know what to do" and such.

President Obama is running into stiff Congressional resistance to his plans to raise money for his ambitious agenda, and the resulting hole in the budget is threatening a major health care overhaul and other policy initiatives.

The administration’s central revenue proposal — limiting the value of affluent Americans’ itemized deductions, including the one for charitable giving — fell flat in Congress, leaving the White House, at least for now, without $318 billion that it wants to set aside to help cover uninsured Americans. At the same time, lawmakers of both parties have warned against moving too quickly on a plan to auction carbon emission permits to produce more than $600 billion.

The unwillingness to embrace some of the major White House tax and revenue proposals has frustrated administration officials. They note that lawmakers, many of them supporters of the president’s ambitious agenda, clamor to hold down the deficit while balking at the proposals to finance his program.

The carbon emissions permit thing may be an environmental nightmare in the long run but as a short-term filler it's not a bad idea. Better polluters at least pay for what they spew than they get to do it for free. And the more they have to pay, the more attractive cleaner emissions start to look.

Is Gregg a SocSec Signal? (Updated)

NH's Judd Gregg is what passes for a moderate in the modern GOP - he only voted with his party 82% of the time. My family lives in New Hampshire and they know Judd Gregg. They were, not to put too fine a point on it, appalled.

Judd is a neoconservative ideologue. He doesn't himself display the usual Pub whackoness, which may be why he stayed in the background acting, as Politico's David Rogers puts it, like "a trusted, behind-the scenes consigliore for every leader since the mid-‘90s, from Mississippi’s Trent Lott to Bill Frist of Tennessee and now Kentucky’s Mitch McConnell." Which means that even though largely invisible publicly, Gregg has had a hand in every GOP fiasco, meltdown, and sleezy trick of the last 15 years.

It Turns Out that Elections Don't Have Consequences

I'm all about giving Obama the benefit of the doubt and waiting to see what he actually does and even telling people we should trust him because when he does things like put Social Security in play, he's just putting on the conservative sheep's clothing to cover up the progressive wolf - as Avedon puts it: trust him because he is a liar - I'm all about all of that.  But it's very hard to think that Lambert is wrong when he says this:

NOTE Having already stolen two trillion for Hank Paulson's golfing buddies, it's only natural that the Village would try to loot Social Security. It's the only big pot of money left.

Obama is a friend of Wall Street, which means that he believes the economic theory that says that we exist to create wealth so the elite can steal it.  That's what happened the last time SocSec was tinkered with in bad faith.  That's what will happen this time with not enough honest brokers on the floor and with the ones who are out there being too weak to matter.  He needs to be beaten back on this swiftly and forcefully.  I don't think that's going to happen to our Precious.

It's interesting to me that whenever Obama is criticized by someone from the left, he tells us to calm down because he's gotten this far without listening to us and anyway, we should trust him.  Except he hasn't gotten this far without us, as his hasty retreat on Social Security during the campaign showed us.  He's only here because the economy conveniently collapsed, McCain was a horrible candidate who ran a horrible campaign and Obama, in large part because of his opposition to the war in Iraq, had the early and overwhelming support of the youth and the left, which helped him beat Clinton.  The comment about Social Security, something he didn't need to do and so must be something that the guy believes, makes it very hard to feel like we aren't being played. 

Unsustainable. That's What You Are.

Doghouse is running a retrospective of our long national nightmare.  Don't miss it.  

In one of the posts, he quotes some of BushCo's inauguraizin':

We will reform Social Security and Medicare, sparing our children from struggles we have the power to prevent. And we will reduce taxes, to recover the momentum of our economy and reward the effort and enterprise of working Americans.

Looks like Obama is taking a page from that book: (emph mine)

President-elect Barack Obama said Wednesday that overhauling Social Security and Medicare would be “a central part” of his administration’s efforts to contain federal spending, signaling for the first time that he would wade into the thorny politics of entitlement programs.

...

Speaking at a news conference in Washington, he provided no details of his approach to rein in Social Security and Medicare, which are projected to consume a growing share of government spending as the baby boom generation ages into retirement over the next two decades. But he said he would have more to say about the issue when he unveiled a budget next month.

Should he follow through with a serious effort to cut back the rates of growth of the two programs, he would be opening up a potentially risky battle that neither party has shown much stomach for. The programs have proved almost sacrosanct in political terms, even as they threaten to grow so large as to be unsustainable in the long run. President Bush failed in his effort to overhaul Social Security, and Medicare only grew larger during his administration with the addition of prescription drug coverage for retirees.

Stupid, hysterical, stupid and misleading to boot!  But, since Obama continues to wake up Pandora, bonk her on the head and push her off her box so he can pry it open, it looks like we're doomed to keep having the same discussion about the sustainability of Social Security for the foreseeable future.   In the interest of time, here's the graph that should be taped to the forehead of every reporter and editor in the country no matter what section of infotainment is their domain. 

Linkety Link Link

The methods by which the Paulson Treasury will hand out $125B to regional and community banks is secret.  Add that to the pile of secret Treasury doin's.  (via Planet Money)

From way back in August, Dean Baker told us how to help homeowners who are underwater: Own to Rent.
Now he's updated the discussion of what it means to bailout homeowners.

I volunteer with a person who has been predicting that PA will be this year's Florida and Ohio.  My tinfoil hat starts buzzing when I read stories like this, which appear to be softening the ground for such an outcome. Bonus points: Our Ms. Bumiller wrote it!

I can't figure this out completely but it looks like Argentina has nationalized their version of "personal account" pensions.   

And more from the Book of Privatization: You can secede from your county, privatize your city and be sure your tax dollars only benefit YOU!  Grover Norquist is so happy.

What Brand of Dog Food is the Tastiest?

Read this 'Is My Money Safe' column at the NYT and then bookmark it.  It will come in handy for waving around the next time the lunatics start talking about privatizing Social Security again.  Money quote:

Q. But what if I am about to retire? Then what?

A. Leaving the work force at a time like this creates big problems. Not only is your portfolio down, but you need to start withdrawing from it. So you are essentially locking in your losses.

If your portfolio has taken a big hit, it may be time to seriously consider delaying retirement. Working just a few years more can make a big difference. Or, a part-time job may keep you from having to dip into your portfolio before it recovers.