Talking Points Memo has the article New GOP Congress Fires Shot At Social Security On Day One.

With a little-noticed proposal, Republicans took aim at Social Security on the very first day of the 114th Congress.

The incoming GOP majority approved late Tuesday a new rule that experts say could provoke an unprecedented crisis that conservatives could use as leverage in upcoming debates over entitlement reform.

The largely overlooked change puts a new restriction on the routine transfer of tax revenues between the traditional Social Security retirement trust fund and the Social Security disability program. The transfers, known as reallocation, had historically been routine; the liberal Center for Budget and Policy Priorities said Tuesday that they had been made 11 times. The CBPP added that the disability insurance program “isn’t broken,” but the program has been strained by demographic trends that the reallocations are intended to address.

The House GOP’s rule change would still allow for a reallocation from the retirement fund to shore up the disability fund — but only if an accompanying proposal “improves the overall financial health of the combined Social Security Trust Funds,” per the rule, expected to be passed on Tuesday. While that language is vague, experts say it would likely mean any reallocation would have to be balanced by new revenues or benefit cuts.

I don’t know why anybody is surprised that the House GOP would waste even a  single day before attacking one of their favorite targets.  It is funny how Democratic run houses of Congress cannot find ways to get anything past the minority opposition, but Republican led houses seem to figure out sneaky ways to bend the rules that will force the minority to swallow whatever the majority wants.

Elizabeth Warren has posted her comments about this on her Facebook pages.

Social Security Works sent me a link to their page Bernie Sanders nails what we need to do for Social Security.

Check out Senator Bernie Sanders’ (I-VT) recent speech on the floor of the U.S. Senate where he lays out the argument for expanding, not cutting Social Security benefits.

In 2015, Social Security Works is standing alongside our Social Security champions, Senators Bernie Sanders, Sherrod Brown and Elizabeth Warren, in their fight to protect and expand Social Security benefits.

Don’t get fooled into thinking that Social Security needs to be cut when in fact it needs to be expanded. We need to get at least some of the stolen money out of the hands of the filthy rich, and put it in the hands of people who need it and will spend it to support themselves and our economy.

Got an email from Elizabeth Warren. I wish President Obama would have learned the lesson that sometimes it is important to fight even if you don’t win the current battle.

Don’t miss the quote from The Hill:

“One senior financial industry executive said the dust-up over the funding bill has forced the industry to recalibrate its lobbying priorities for the coming year. Given Warren’s megaphone, the executive said, getting through the next Congress without new restrictions on large banks would constitute a win.”

Below is the email.

Steven, Washington is rigged for those who can hire armies of lawyers and lobbyists. Last week, we got a close look at what really goes on. House Republicans slipped a provision into the must-pass, omnibus budget package in a secret, closed-door deal. Citigroup lobbyists literally wrote the provision to weaken the new rules on Wall Street and make it easier for the biggest banks to get bailed out again in the future. JP Morgan CEO Jamie Dimon personally called up members of Congress to lobby for their votes. Nobody likes bailouts. Democrats don’t like bailouts. Republicans don’t like bailouts. But Wall Street proved again that with enough money and enough power, they can tilt the playing field in Washington a little more in their favor. I fought my heart out against that provision last week. So did tens of thousands of people who signed petitions, who called their representatives, who tweeted and Facebooked, and who spoke out about it. We lost this time. But here’s what I want you to remember: It’s better to fight and lose than not to fight at all. It’s better to fight because if you don’t fight, you can’t win. Besides, even when you don’t win, you can change the game. Here’s a snippet from an article in The Hill newspaper earlier this week that shows what I mean: “One senior financial industry executive said the dust-up over the funding bill has forced the industry to recalibrate its lobbying priorities for the coming year. Given Warren’s megaphone, the executive said, getting through the next Congress without new restrictions on large banks would constitute a win.” Sure, that’s just one person’s opinion. There are a lot of other people who work for big banks on Wall Street and in Washington who are salivating right now, making perfectly clear they view this as the beginning of a larger assault on financial reform. But without our fight, they would be looking at a much easier path to more bank handouts. We know that our job is going to get tougher in 2015. Mitch McConnell has been saying for months – both out in the public and in secret meetings with the Koch brothers – what his plan will be when Republicans take control of the Senate: use every trick and political game they can think of to undermine President Obama and grind the government’s work to a halt. That’s why it’s more important than ever to fight back for working families. To fight back for people who couldn’t get health insurance for years and don’t want Republicans to take their new insurance away. To fight back for Social Security and Medicare so seniors can retire with dignity. To fight back for the environment so our grandkids will be able to breathe the air and drink the water. To fight back for accountability and a level playing field so nobody steals your purse on Main Street, or your pension on Wall Street. That’s why we’re here: To fight the big fights. We won’t always win, but darn it, we’re going to try. I wanted to take a moment to say thank you. Thank you for your support, for your time, for your voice, and for your fight. We’re a team, you and I. I never forget that. Thank you for being a part of this, Elizabeth All content © 2014 Elizabeth for MA, All Rights Reserved PO Box 290568 Boston, MA 02129 Paid for by Elizabeth for MA

The video below was featured in the Politicus USA article Bernie Sanders Unveils A 12 Point Economic Plan To Break The Koch Oligarchs.

The Politicus USA article provided a list, gleaned from the video, of the 12 points of the Sander’s plan.

Sanders detailed a 12-point economic program to,

– Invest in our crumbling infrastructure with a major program to create jobs by rebuilding roads, bridges, water systems, waste water plants, airports, railroads and schools.

– Transform energy systems away from fossil fuels to create jobs while beginning to reverse global warming and make the planet habitable for future generations.

– Develop new economic models to support workers in the United States instead of giving tax breaks to corporations which ship jobs to low-wage countries overseas.

– Make it easier for workers to join unions and bargain for higher wages and benefits.

– Raise the federal minimum wage from $7.25 an hour so no one who works 40 hours a week will live in poverty.

– Provide equal pay for women workers who now make 78 percent of what male counterparts make.

– Reform trade policies that have shuttered more than 60,000 factories and cost more than 4.9 million decent-paying manufacturing jobs.

– Make college affordable and provide affordable child care to restore America’s competitive edge compared to other nations.

– Break up big banks. The six largest banks now have assets equivalent to 61 percent of our gross domestic product, over $9.8 trillion. They underwrite more than half the mortgages in the country and issue more than two-thirds of all credit cards.

– Join the rest of the industrialized world with a Medicare-for-all health care system that provides better care at less cost.

– Expand Social Security, Medicare, Medicaid and nutrition programs.

– Reform the tax code based on wage earners’ ability to pay and eliminate loopholes that let profitable corporations stash profits overseas and pay no U.S. federal income taxes.

I think this is a plan that all progressives ought to be able to promote enthusiastically. We cannot fight the oligarchs by just being negative about what they are doing and want to do more of. We have to demonstrate a vision of what we would do differently. This plan by Bernie Sanders is an excellent one.

Those of  us who are fans of Elizabeth Warren know the story behind what she stands for, but not enough other people know it.  So no matter how many times we have heard it, it still bears repeating. Here is Elizabeth Warren explaining the story at the Center for American Progress Policy Conference in November 2014.

In this 18 minute speech, she spent about 15 minutes explaining the story. If you have not heard the story, you really owe it to yourself to listen to this first 15 minutes. Once you have heard what she has to say, come back here for my comments on what she said in 2 of the 3 minutes just before the end of her speech.

I want to summarize for you some research from election day … The survey of voters in 11 battleground states. Now remember, these are the people who showed up to vote in mid-terms, two weeks ago, the people who in 10 of the 11 states that are represented in this survey sent Republicans to the Senate. And here’s what they said, 80% of all those voting said both parties are doing too much to help Wall Street, 75% said invest more money in education from pre-K through college. 66% said close corporate tax loopholes to make investments in infrastructure, or reduce the deficit. 62% said raise the minimum wage. 61% said increase Social Security taxes and increase benefits. And 62% said the Republicans don’t have a plan to help the economy. People across this country get it. Sure there’s a lot of work to be done and there is a long way to go before Democrats can reclaim the right to say that we are fighting for America’s working people …

She needs a whole other speech to explain why in 10 of the 11 battleground states in the last election the voters sent Republicans to the Senate. What she did mention in this speech is that “80% of all those voting said both parties are doing too much to help Wall Street.”

When she said that “62% said the Republicans don’t have a plan to help the economy”, she needed to finish that thought. What percentage of the people thought that the Democrats did have a plan to help the economy? She missed the opportunity to explain what is wrong with Democrats with whom large majorities of people agree with their supposed policies, but these very voters who agree with them did not vote for them.

She mentions that Democrats have a lot of work to do to “reclaim the right to say that we are fighting for America’s working people.” Maybe she was trying to be too diplomatic to be more specific about what Democrats didn’t do or just didn’t do correctly. I hope her new role in advising the Democratic leaders in the Senate does not stop her from being more specific in the near future about what Democrats need to do.

Without me naming names, I ask you to think about what Democratic candidates who might run for the Presidential in 2016, have as clear an idea of what America did right from the depression era up until 1980 and what they did that was so wrong from 1980 up until now as Elizabeth Warren explained in the first 15 minutes of this speech. Try to be brutally honest with yourself. The future of the party and this country may depend on your ability to face the facts.

I just received an email from Elizabeth Warren.

Steven, I just left a Senate Democrats caucus meeting, and I wanted you to know: Harry Reid has asked me to serve as Strategic Policy Advisor to the Democratic Policy and Communications Committee. That’s a fancy way of saying that I’ve been asked to join the Democratic leadership in helping decide how we can fight most effectively for the people who are counting on us. I don’t kid myself. Life is about to get harder in the Senate when Republicans take over control, but this is a seat at the table for all of us – and that matters. It’s a seat at the table to fight for kids who are being crushed by student loan debt. Working moms and dads struggling to make it on minimum wage. Seniors who depend solely on their Social Security checks to keep a roof over their heads. And all of us who just want a level playing field and a fighting chance to succeed. Washington is a tough place, and it’s not easy to make real, lasting changes. We all know that. But we also know it’s possible, and we know how much it matters. That’s why we’re going to keep fighting for what we believe in. Thank you for being a part of this and making this possible. Elizabeth

This should enhance the message that the Democrats put out about what this country needs. I hope it also changes the policy positions of the Democrats. it’s about time they countered the false story of the Republicans about what it takes to get this economy working for the bottom 90% of wage earners. Had that bottom 90% heard a believable and compelling story from the Democrats, the election would not have been a disaster.

Now if Pelosi can only appoint Alan Grayson to a similar position in the House, we might finally hear about a winning strategy for the country. (I purposely said country, not party. We should all want a winning strategy for all the citizens of the country.)

The New York Times has the article The Great Wage Slowdown, Looming Over Politics.

Since I know that very few if any of you will click through to read the article, I am forced to copy the graph, and show it here.  My appologies to the copyright police who may be lurking, but I claim it is  fair use.

Now that the proof of the premise is in front of you, I can go on to comment on the article itself.  This is an interesting article because it goes from solid identification of the problem, to crazy solution, to sanity rescuing detail.

Here is the solid identification of the problem.

A quiz: How does the Democratic Party plan to lift stagnant middle-class incomes?

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The fact remains that incomes for most Americans aren’t growing very fast and haven’t been for years. Median inflation-adjusted income last year was still $2,100 lower than when President Obama took office in 2009 — and $3,600 lower than when President George W. Bush took office in 2001. That’s not just because of the financial crisis, either: Last month was another solid one for job growth and another weak one for average wage growth, the latest jobs report showed.

We’re living through the great wage slowdown of the 21st century, and nothing presents a larger threat to the Democrats’ electoral fortunes than that slowdown.

Here is the seemingly insane proposal for a solution.

The best hope for doing so, in the immediate future, is probably the oldest and most obvious play in the book: a tax cut.

Here is a sanity rescuing detail.

Because the long-term budget deficit remains a problem, any such tax cut could be paired with a tax increase for top earners, who — even after the expiration of some Bush-era tax cuts — still face lower rates than they have for most of recent history. “Taxes for high-earning Americans are too low,” argues Roger Altman, the Wall Street executive and Democratic adviser. Most Americans favor tax increases on the well-off, polls show.

A sane solution is not nearly the same as a good solution.  Cutting the taxes on a too meager income is not enough.  Sure you get to keep a little more, but the income for many would still be too meager.

What about the people who are working multiple jobs, and long hours at minimum wage, and still don’t make enough money to owe any income taxes?  A huge boost on the earned income tax credit would help those people.

Yes, huge marginal rates of income tax for the wealthy with very constrained loopholes would reduce the incentives for the ultra-wealthy to grab all the income there is.  Using the money collected to invest in all the needed public services that we have been deferring would employ people, boost wages, and make the economy run better.

Eliminating tuition and fees for higher education would lift a huge strain on many in the middle and lower classes.

Increasing the Social Security benefit would diminish the need for people to have so much private savings to cover their retirement.

I leave it up to your imagination to think of other parts of a plan that would answer the initial question, “How does the Democratic Party plan to lift stagnant middle-class incomes?”

Let me explain that one about Social Security.  Supposing that you could find a safe investment that would pay you a 5% rate of return above inflation.  (For the sake of simplicity, let us assume the inflation rate is zero.)

If you were getting $28,000 per year in Social Security today (that is an actual example), you would need a $560,000 nest egg to produce that income stream a 5% rate of return.  ($560,000 * 5% = $28,000).

Suppose that you could only get a 3% rate of return such as in the current environment.  That would require a nest egg of over $933,000. ($933,000 * 3% = $27,990)

Depending on how much income you think you need in retirement, you can scale up or down the amount of nest egg that is needed to back your retirement.  One way or another, through a combination of private savings and publicly funded pensions, this is the amount that is needed.

If this were wholly publicly funded, the government would need a nest egg large enough to fund the current (and expected maximum) of retired people at any one time.  Since the public nest egg is left behind when a person dies, that nest egg could fund the retirement of the next person to come into the retirement pool.  Contrast this with private savings backed retirements.  Unless you had relatives that you knew would pass on their nest egg to you at the moment of your retirement, you would have to be saving up for your retirement throughout your whole working life.

The private savings for investment would be less onerous if your retired people would die, or be dead when you were ready to retire.  These people could not have used up their nest egg to live the really good life during retirement.

In any case, the private system seems to require savings for retired people and for non-retired people.  The public pension plan would only need savings for the retired people (and enough to support expected population growth).

The Washington Post has the opinion piece Elizabeth Warren: It’s time to work on America’s agenda.

The American people want a fighting chance to build better lives for their families. They want a government that will stand up to the big banks when they break the law. A government that helps out students who are getting crushed by debt. A government that will protect and expand Social Security for our seniors and raise the minimum wage.

Americans understand that building a prosperous future isn’t free. They want us to invest carefully and prudently, sharply aware that Congress spends the people’s money. They want us to make investments that will pay off in their lives, investments in the roads and power grids that make it easier for businesses to create good jobs here in America, investments in medical and scientific research that spur new discoveries and economic growth, and investments in educating our children so they can build a future for themselves and their children.

Before leaders in Congress and the president get caught up in proving they can pass some new laws, everyone should take a skeptical look at whom those new laws will serve. At this very minute, lobbyists and lawyers are lining up by the thousands to push for new laws — laws that will help their rich and powerful clients get richer and more powerful. Hoping to catch a wave of dealmaking, these lobbyists and lawyers — and their well-heeled clients — are looking for the chance to rig the game just a little more.

Now you know that there is a Senator in Washington who gets the  message.  This is why I am ready for Warren.

Has the other potential female candidate for the Democratic nomination to run for President in 2016 figured it out?  If  she has, does she dare speak out about what she has learned?  When will she tell us about her assessment of last Tuesday?

You can tell Elizabeth Warren what you think about the article.  She posted the article on her Facebook page.

The Boston Globe has the article Opportunities exist to close gap between rich and poor, Yellen says

And one more thing: Do what the rich do, and pass on the wealth.

Yellen said an inheritance is routine for the wealthiest families, but increasing the practice among those in lower echelons of the income scale would provide support to future generations with the potential to shrink the wealth divide.

Does she think that poorer people have some “wealth” that they are not passing on? Maybe they are spending all their wealth eating cake rather than passing it on.

Home equity represents a large share of the wealth for many middle- and lower-income families.

With home prices dropping in the financial crisis, many people are under water in their mortgages. There is no wealth to pass on, only debt.  What are we supposed to say to the people who have already lost their homes to foreclosure?

With the current crop of college students taking on mortgage sized debt to finance their education, there will be even less chance of them  having any wealth to pass on to their children.

Republicans are talking about cutting Social Security. That should also lessen the wealth that is not being passed on. Problem solved.

I had such high hopes for Janet Yellen. I had no idea that she was at a Marie-Antoinette level of out of touch with reality.

Watch Elizabeth Warren’s  presentation.  It is only about 5 minutes long.

With Social Security and Medicare under renewed threat from Tea Party extremists in Congress, Senate Majority Leader Harry Reid, House Democratic Leader Nancy Pelosi, Senator Elizabeth Warren, Congressman Bruce Braley, other members of the House and Senate, the Koch Sisters, seniors from across the country, advocates for seniors and other concerned Americans will hold an event this Thursday, September 18th in Washington, DC to tell the GOP: “HANDS OFF Social Security and Medicare – We Earned It!”.

In this class warfare, our class won’t have a chance if we don’t stand up and fight.