The most important point remains the same: If we let the Bush tax cuts expire, the national debt will be significant and rising in the long term, but will not be that much larger than today even in 2035. Which means that the national debt problem over the next twenty-five years is as much about tax cuts as about entitlement spending.
Ben Leet commented on that post as follows:
As Dean Baker and Jeff Madrick say repeatedly, the health care system is the driver for high federal deficits in the years to come.
They may both be right. Note, that if we were to fix the cost problem for the government funded part of the health care system, but did not fix it for the privately funded part of the system, health care would still eventually take 100% of the GDP. The issue of the rising costs of health care progressing at the current rate is completely independent of whether it is paid for by the government, direct payment by private citizens, or funded through employers. The result on our economy will be devastating.
The protesters of “Occupy Albany” issued a powerful consensus statement recently, which reads in part:
“The interests of those who purchase influence are rewarded at the expense of the People, from whom the government’s just power is derived. We believe that this failure in our system is at the core of many interconnected issues we face as a society, and its resolution is key to a just future. We therefore demand true democracy, decoupled from the corrosive influence of concentrated economic power, and we call all who share in this common goal to stand with us and take action toward this end.”
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Jon Huntsman, a candidate for the Republican presidential nomination, is addressing this directly – insisting that we should force the largest banks to break up and to become safer. No other candidate for the presidency is seriously confronting this issue head-on: just saying “we’ll let them fail” is no kind of answer when the failure of megabanks would cause so much damage.
We should learn from both the WaMu and the Occupy movement. In both cases, the lesson is the same: concentrated financial power is a gift that keeps on giving – but not to you.
As for the statement about Jon Huntsman, perhaps this is why some Democrats in New Hampshire are crossing over to vote for Huntsman in the New Hampshire Republican presidential primary.
I discovered this video of Naomi Wolf’s appearance on Countdown With Keith Olbermann at a most opportune moment.
I just read the UPI story Obama reluctantly signs defense bill. In talking about Obama’s criticisms of the bill, the story goes on to say the following:
Many of his criticisms revolve around the detention of foreign and U.S. prisoners and the potential for weakening a president’s authority in such situations.
“I want to clarify that my administration will not authorize the indefinite military detention without trial of American citizens,” he said.
Naomi Wolf’s statements show why Obama’s mild objections and unenforceable promises are so dangerous. Remember, that Obama promised to veto this bill if it had the objectionable clauses. Why we should have believed this promise when it was his administration that wanted those clauses in the bill (as reported by Senator Carl Levin), I don’t know.
Could Obama consider his re-election in 2012 to be the start of a new administration that is not bound to the promise above that he gave for his current administration? What about the powers this bill gives to presidents who come after Obama?
I just cannot ever give a vote to a man who allowed this pernicious bill to pass when he could have at least vetoed it. Even if the Congress would have overridden his veto, the veto would have been a strong statement.
The crisis of the euro currency zone is an excellent example of how flagrant lies can successfully be converted into accepted wisdom. Almost every generalization about the crisis found in the mainstream media is false. As a result, the mainstream punditries on the crisis are ideological polemics masquerading as analysis. Further, often progressive critiques of the reactionary “austerity” policies by the euro zone governments accepts the mainstream faux-facts about the crisis, fuelling the There-Is-No-Alternative (TINA) syndrome.
These charts provide the support numbers for exactly what Dr. Heiner Flassbeck was describing in the videos posted in my previous post Eurocrisis: “Democracy is Not a Given”.
It is hard to imagine getting this more exactly backward than Ron Paul does in this video. Deregulation and tax cuts for the ultra-wealthy are some of the causes of the problem. They are not the cures. Deficit spending at the wrong part of the economic cycle is a huge cause of the problem. Reducing deficit spending in the exquisitely timed wrong part of the economic cycle would spell disaster.
Just because Ron Paul talks about arcane economic topics doesn’t mean he knows his donkey from his elbow when he speaks. Somebody needs to counter this horrible mis-education of the voter by this dangerous man.
The housing bubble could have happened in a higher interest rate environment just as easily. If the repeal of the Glass-Steagall act deregulating the banks had not happened, it is much less likely that the bubble would have occurred. Had George W. Bush not stimulated the economy with his huge deficits at a time when the economy was already humming along, there would have been less investment money to chase the mere pushing financial derivatives around in the absence of any more productive investment possibilities.
Taxing away some of that ill spent money of the super wealthy would also have helped rein in the bubble. Instead George W. Bush instituted tax cuts. This is just one more reason why the tax cuts in the middle of two wars, an already overstimulated economy, and an unbalanced budget were totally insane.
Admittedly, the Federal Reserve could have stepped in and raised bank reserve requirements when they saw the bubble forming under Alan Greenspan’s tenure as head of the Fed. Instead of wondering over the irrational exuberance of the market, Greenspan could have figured out the problem and done something.
The non-ideological economists were pleading with Greenspan to get up off his donkey and take action. Ron Paul may be half-donkey right about Greenspan’s idiotic policy of low interest when the economic cycle required higher interest. This just added more fuel to the fire that George W. Bush was fiscally promoting with his deficits and tax cuts. Raising the interest rates during the current phase of the economic cycle would also be almost perfectly mis-timed.
Would an automotive analogy help any? When faced with a car whose engine is revving out of control past the red line and whose gas tank is full, you do not pour gasoline anywhere near it. That will just set it on fire. However, when the engine has stalled because the gas tank is empty, that is exactly when you need to pour gasoline in the tank. (For my British readers, for gas and gasoline, put in the word petrol.)
The article The Big Lie has the subtitle “Wall Street has destroyed the wonder that was America.” At first, I wondered if the big lie was that Wall Street has destroyed the wonder that was America.
I think the following quote from the article should set the matter straight:
As 2011 slithers to its end, none of the major problems that led to the crisis point three years ago have really been solved. Bank balance sheets still reek. Europe day by day becomes a financial black hole, with matter from the periphery being sucked toward the center until the vortex itself collapses. The Street and its ministries of propaganda have fallen back on a Big Lie as old as capitalism itself: that all that has gone wrong has been government’s fault. This time, however, I don’t think the argument that “Washington ate my homework” is going to work. This time, a firestorm is going to explode about the Street’s head—and about time, too.
This article calls for a level of retribution, and perhaps violence, that the Occupy movement specifically abjures.
On more than one occasion my father, a janitor, had to take up a collection for a student to send home to their family, to help them buy a ticket if there was an emergency, or to subsidize the funeral expenses for one of his crew, or the part-timers, who didn’t have his years of seniority, and pay.
No child could do that job.
Why is it so easy for a person like Newt Gingrich to forget the humanity behind the people he disparages? I suppose it is the same justification that applied to George W. Bush’s “compassionate conservatism”. If you don’t really know any people outside your “class”, it is easy to wage class warfare without realizing you are doing it. And that is being very charitable to Gingrich and Bush.
I have edited the video of debate at Stonehill College on December 6, 2011 to focus on Marisa DeFranco’s responses. The intent is to give you easy access to her positions on various issues.
It cuts the video from of the whole debate from 90 minutes, to just under 23 minutes to focus on Marisa DeFranco. This edit is not a commentary on what the other candidates might have said in the debate.
Notice how Elizabeth Warren also puts emphasis on public involvement in getting legislation to pass through the blockades in Congress. That is what I find so frustrating when Elizabeth Warren refuses to use her time in the limelight to educate the public on the issues that require their involvement.
