Robert Reich has posted an item on his Facebook page.  I have excepted the starting sentence of the post below.

Tea Partier David Brat’s surprising win last June over House minority leader Eric Cantor for the Republican nomination for Virginia’s 7th congressional district turned on Brat’s charge that Cantor represented “large corporations seeking insider deals, crony bailouts, and a constant supply of low-wage workers.”

If we can just get the TPers to concentrate on the issue of “large corporations seeking insider deals, crony bailouts, and a constant supply of low-wage workers.”

If they can get this fixed, then Social Security and Medicare won’t even be a problem. We can then realize that we can be allies with the TPers on some issues.

Naked Capitalism has the article Summer Rerun: Why Is the Left Slice of the Democrats Getting Crushed?

Up until the election, all public polling had shown Sheyman leading by double digits, and Sheyman had outraised and out-enthused Schneider.  Sheyman had as his platform breaking up the banks, ending various wars, protecting Social Security and Medicare, and marriage equality.  He had worked at Moveon, and he proudly called himself a progressive, while attacking Schneider as a closet Republican who had given money to the GOP and voted in Republican primaries.  All of the talking points developed in the course of seven or eight years of internet Democratic politics – “bold progressive”, “people-power”, and “progressive” were on display.  He lost badly.

Some good questions, perhaps.  I am not sure about the answers, though.  It could be that the public is just not ready yet.  Maybe we are still in the building phase.

There is no candidate in Massachusetts right now that has stirred me to action as much as Elizabeth Warren did.  She is on the leading edge of the building phase. Maura Healy is the closest one that I can think of, but the office of Attorney General is just not as stirring as the office of US Senator.

It is tough for a politician to make the case that she or he will make a difference.  Elizabeth Warren got over that threshold.

Otherwise, I am out of ideas on how to explain it or what to do.

Baseline Scenario has the article Larry Summers Should Keep His Mouth Shut.

TARP made its first round of investments on Monday, October 13, 2008. As of November 21 last year, TARP was about to turn a paper profit, at least according to the Treasury Department, getting $432 billion back on $422 billion in investments. That’s a 2.4% total return over more than five years, or an annualized return of less than 0.5%. If the government had instead put its money into the stock market on Friday, October 10, 2008, it would have earned a total return of 132% over the same period, or more than 18.3% per year. If Treasury had simply used TARP to buy 5-year Treasury bonds and held them to maturity, it would have earned an annual yield of 2.8%. In short the government only got back “substantially more than it invested” if you ignore the time value of money and risk.

Keep this explanation in mind when ever you hear the story that the Government actually made money on TARP.  After looking at these numbers I went back to a record of my own year end net worth over the last few years and compared to my net worth today.  I chose to use these numbers because I had them readily at hand.

From the end of 2009 to today, my net worth is up 49%.  From the end of 2008 to today, my net worth is up 82%.  Outside of my investments, my only income is Social Security and a very small pension from my days at Digital Equipment Corporation.  So, I am actually spending money from my investments to support my living standard, and yet my net worth is up 82% from the bottom year end value. Compare this to Larry Summers’ record of 2.4% gain.  So that’s why they call him a genius?

The Real News Network has the final part of this series in the interview Confronting Financialization on Steroids – Costas Lapavitsas on Reality Asserts Itself (8/8).

LAPAVITSAS: Yes. We need regulation. We need regulation with teeth for sure. There’s no question about it. The point there is that this isn’t enough. And if I were to ask–if I were asked to put it in a single word, I would also say that we need to consider ownership, of course, not just regulation. Ownership matters very much, ownership of finance, but also ownership of other sectors of the economy, because ownership allows (A) private owners to bypass regulation, (B) allows public owners of whatever assets they might be to do some things about the economy that regulation doesn’t allow.

In addition to that, I would argue it isn’t just a matter of ownership or of regulation; it’s also a matter of provision, mechanisms of provision, of basic goods and services that households need. This isn’t just a matter of ownership, of the ways to produce and the ways to do finance; it’s also of how we organize social life more generally and allow people access to basic goods and services, which is, as we’ve discussed, a fundamental to financialization.

So if you asked me, then, for a broad picture, I can give you nothing other than a broad picture, because I don’t know the situation in Baltimore or another similar city in the United States.

I would say that to reverse financialization, we need to think first of all of what we’re going to do at the level of the productive enterprise in the first place. We need productive enterprises that actually focus on production rather than on financial profits, that actually take a long-term perspective, that invest to create productive capacity and to create jobs and to provide employment for people, and we need to think of productive capacity that detaches itself from finance, doesn’t have financial motives and financial profit-making in mind, and organizes investment on a systematic basis, as I’ve indicated. That’s the first thing we need to do.

Were it not for the interference of the interviewer, I would have been able to say that this is the most successful attempt to discuss solutions that I have seen coming at the end of a very good exposition of what the problem is.

I try to imagine what Lapavitsas might have said, if he had only been allowed to speak without interruption. I haven’t found these ideas in Lapavitsas’s book yet in a way that I think he was about to explain them in the interview.

Ironically, it may have been Paul Jay’s direction that got him to the threshold while it was Paul Jay’s direction that prevented him from getting over the threshold.

In this interview Costas Lapavitsas showed many times over that he is a far deeper thinker than Paul Jay can imagine at this point. Paul Jay was constantly trying to redirect the answers so that they would fit into what Paul Jay could imagine. Costas Lapavitsas kept trying to raise Paul Jay’s horizons, mainly to no avail.

Lapavitsas tried over and over again to redirect Jay’s thinking away from government control to what he called public control. Because Paul Jay could not get his mind around what Lapavitsas was trying to tell him, Jay kept interrupting at every point where Lapavitsas was about to explain more of what he meant by public control.

The Real News Network needs to give Paul Jay a bit of a rest. Perhaps bringing in another interviewer to complete the series, and let Lapavitsas dive deeper into saying what he is trying to say.

It is time for Paul Jay to get his ego out of these interviews. He needs to let deep thinkers explain their deep thoughts. Rather than constantly trying to refocus the interview into Jay’s narrow perspective, he needs to work harder to bring out the ideas the invterviewee is trying to explain.

Now to demonstrate my narrowness of mind, I kept hoping that someone would mention the idea of the Social Security Trust Fund as a source finance for moving the private sector to have more of a public interest.

You need to read my many previous posts on this web site to see what I mean by this. One place to start would be at my previous post Saving Social Security: A Better Approach. I also had more comments about this post in the subsequent post Elizabeth Warren: We should be talking about expanding Social Security benefits.

Imagine the Social Security Trust Fund having investments in private companies throughout the economy. Just like large private investors, the Trust Fund could think beyond the narrow interests of an individual company, and pay some attention to the needs of the entire portfolio. Unlike large private investors, the Trust Fund would not concentrate solely on the direct financial return of its investments, but it could also think about the broad social impact of what the investment could accomplish. The Trust Fund would not be optimizing the performance of one company, nor of one investor’s portfolio, but it could try to optimize the results for the beneficiaries of the Trust Fund. Need I remind you that those present and future beneficiaries are just about the entire population of the country?

Naked Capitalism has the article Why Have Private Equity Limited Partners Done a Lousy Job of Protecting Their Interests? by Yves Smith.  The issues raised in this article are going to be a continuing focus of the Naked Capitalism blog.

If you are an investor, this information is going to be vital to the health of your investment portfolio.

But investors are going to find themselves caught between professing they didn’t know how bad things were, which is tantamount to admitting that their due diligence and oversight was lax or trying to cop that the revelations are no surprise. But the “nothing to see here” position reflects even worse on the investors, since it meant they were at least dimly aware that some practices didn’t pass the smell test, but they chose not to act on their suspicions, out of reluctance to ruffle their precious relationship with the general partners, when many of those general partners, despite their well-cultivate charm, are out only for maximizing their own return.

This trend in pension fund investing is the fly in the ointment to my previous post Saving Social Security: A Better Approach.  The idea of running Social Security like a well run private or state level pension fund presupposes that these other pension funds are still well run.  We need to modify our definition of what a well run pension fund means.  It means running with the old-fashioned responsibility that well run pension funds used to embody.  It means avoiding the irresponsible behavior described in Why Have Private Equity Limited Partners Done a Lousy Job of Protecting Their Interests?

Social Security Works has the audio of the Conference call with Senator Bernie Sanders on Social Security.

On the call, Nancy [Altman] and Senator Sanders were joined by several of our coalition partners as well as thousands of activists. They discussed where the fight currently stands to strengthen Social Security, how your activism is impacting the national discussion, and how we can continue to change the conversation in 2014.

With the president set to unveil his budget in less than a month, we must continue to stay engaged in this critical issue. Last year, the president included a Chained CPI in his budget, which would have meant severe cuts in Social Security had it been enacted.

In 2010 the Bowles-Simpson commission attempted cuts to earned benefits. In 2011 the Supercommittee did the same. Every year Social Security comes under fire, and every year we beat them back and win. With your help, we’ll do it again in 2014

There is probably no stronger Senator in this fight than Sen. Bernie Sanders of Vermont. It is important to listen to him and to support his efforts by our actions. He understands that the money being spent to defeat us is enormous. He also understands that when we make our voices heard, we can overpower even this vast amount of money.

Alternet is carrying the article Elizabeth Warren: It’s the Right of Every American to Retire with Dignity — Why We Must Expand Social Security.  The dateline is today and the words are from Elizabeth Warren, but there is nothing new.  It is still a good argument for why we need to expand Social Security benefits.

For a generation now, working families have been squeezed by stagnant wages and rising costs for housing, health care, and college. Even as families have cut back on expenses for things like food, clothing, furniture, and appliances, it hasn’t always been enough; many have been forced to take on more and more debt just to pay for necessities.

One major consequence of these increasing pressures on working people is that the dream of a secure retirement is slowly slipping away. Families haven’t been able to save as much as they used to, and only 18 percent of private-sector workers have defined benefit pensions today compared with 35 percent two decades ago. Forty-four million workers have no workplace retirement savings plan.

I do have a  bone to pick with an idea that Elizabeth Warren keeps repeating.

Social Security works; no one runs out of benefits and the guaranteed payments don’t rise and fall with the stock market.

The Social Security works part is correct.  The part after the semicolon has a grain of truth if you really understand investing, but its implications are totally misleading if you don’t. I left comments on the article.

If the system were run like a really well managed retirement system, the investments would be diversified beyond special Treasury bonds that pay 5% interest. I am definitely not proposing privatizing Social Security, where everyone has to invest in stocks at retail. The successful national, state, and private pension funds don’t have their members do their own investing. In the history of corporate pension funds that were successful over the long-haul, none of them had the members do their own investing.

The individuals who do know how to save and invest for retirement do use the stock market as one of their investment tools, and they also protect themselves from the ups and downs of the stock market. In retirement, you depend on regular dividends from reliable companies. The stock market as a whole and over time historically has returned 10% growth on average, only some of which comes from dividends. The rest comes from capital gains. So you aren’t going to take 10% of your investments out every year in retirement. Under most circumstances, history has shown that it is safe to take out 5% a year and your nest-egg will grow with inflation until you die. This way the 5% a year you take out will also grow with inflation.  You also need a lifestyle with enough flexibility in it so that you can adjust during really major financial disasters if things get so bad that you can’t even get your 5% out without reducing your capital.  I retired in 2006, and we had a severe market  crash only 3 years later.  That is one of the worst things that can happen to you in retirement. I recovered from that quite nicely, thank you very much.

So Elizabeth Warren is not telling the complete truth when she implies that investing in stocks is too risky, without clarifying the rightful place for stock investing in a total retirement strategy. She wrote a book with her financial adviser daughter on how to manage the family budget. Surely she learned enough from her daughter if she hadn’t already known it herself, that pretending that the stock market is too risky for a pension system is to oversell the dangers of an idea that can be used wisely, if you know how.

Truthout has the article The End of the Assault on Social Security and Medicare by Dean Baker.

Third Way is one of a long list of organizations that have received Wall Street funding to go after Social Security and Medicare under the guise of protecting the young from their greedy parents and grandparents. This list includes Lead or Leave, the Concord Coalition, The Committee for a Responsible Federal Budget, America Speaks, Fix the Debt and the Can Kicks Back.

At a time when we are seeing the largest upward redistribution in the history of the world these organizations have attempted to divert attention from the class war on the nation’s middle class and poor. Instead they are trying to convince young people that their financial difficulties stem from the size of their parents’ Social Security checks.

I’ll have to go back and reread the article to see how the headline fits the content.  I don’t see where the end of the assault comes in.

I left the comment to Dean Baker and the other readers:

Are you aware of the work by Arun Muralidhar? His latest paper is:

Saving Social Security: A Better Approach by Thomas K. Philips and Arun Muralidhar.

I have managed to connect him up with people in the Elizabeth Warren office in Washington. I expect great things from this collaboration.

I am hoping for another article by Arun Muralidhar soon.  The country can stand the benefit of all that he knows about various attempts around the world to try different ideas for funding Social Security programs and pension programs.  He has a good knowledge of what fails and what succeeds.

The Daily Kos has the article Social Security expansion now very real. Thanks, Third Way!.

Rep. Allyson Schwartz (D-PA.), honorary co-chair of Third Way and gubenatorial candidate, is now a cosponsor of a bill to expand Social Security. That’s after Third Way president Jon Cowan, Jim Kessler, the group’s senior vice president for policy called the legislation “exhibit A of this populist political and economic fantasy.” The “fantasy” that is going to doom, DOOM, Democrats.

If you are a fan of Hillary Clinton for President in 2016, tell me where she stands on this issue. Is she leading, following, or standing in the way?

You can start with The New Republic article The Next Big Fight Between Hillary Clinton and Liberals.