Who’s Being Pushed Over the ‘Fiscal Cliff’?

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AFL-CIO and Senators Oppose Cuts

AFL-CIO Now

 

Elected Officials and President Trumka Reject Benefit Cuts to Social Security, Medicare and Medicaid

11/15/2012

Kenneth Quinnell

A group of Democratic senators is circulating a letter opposing benefit cuts to programs like Social Security, Medicare and Medicaid and saying that the Bush tax cuts for the wealthy should expire at the end of the year. The letter also calls for increasing revenue, cuts to defense and the closing of tax loopholes for the wealthy and corporations. The letter was drafted by Sen. Jay Rockefeller (W.Va.) and Sen. Tom Harkin (Iowa). The Democratic senators are hoping to get 30 senators to sign the letter.

The letter reads:

We urge you to reject changes to Medicaid, Medicare and Social Security that would cut benefits, shift costs to states, alter the structure of these critical programs or force vulnerable populations to bear the burden of deficit-reduction efforts. Each of these programs is a vital lifeline to the middle class.

Democratic National Committee Chair Debbie Wasserman Schultz also said that we don’t need to cut Social Security or Medicare benefits. She also said that raising the eligibility age would be a benefit cut and should be avoided.

AFL-CIO President Richard Trumka echoed the comments from the Democrats in the House and Senate, rejecting the idea that we even face a “fiscal cliff”:

The most frustrating thing about Washington, D.C., is the way political insiders create a self-reinforcing reality out of nonsense. Take what the media are calling the “fiscal cliff.” There is no fiscal cliff! What we’re facing is an obstacle course within a manufactured crisis that was hastily thrown together in response to inflated rhetoric about our federal deficit.

But all the deficit chatter has distracted us from our real crisis—the immediate crisis of 23 million unemployed or underemployed workers.

It’s time to protect Social Security benefits. It’s time to protect Medicare and Medicaid benefits. And it’s time to raise taxes for the richest 2%, to stop tax breaks that encourage companies to send jobs offshore and to close loopholes that allow some people and corporations to hide income in offshore tax havens.

Voter Suppression Contested in PA Commonwealth Court

Pa. voter ID law far from a done deal

November 14, 2012 12:11 am
  • Early voters leave the Green Tree Municipal Building after casting their ballot.
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By Timothy McNulty / Pittsburgh Post-Gazette

While the presidential race is over, Pennsylvania’s voter identification law and the fights over it live on.

The photo ID requirements suspended for last week’s election remain in place for the state’s May 21 primary, when Pittsburgh’s mayor and other local and judicial offices will be on the ballot, and legal challenges to the ID law remain on the docket, too. Commonwealth Court Judge Robert Simpson, who temporarily stayed enforcement of the requirements Oct. 2, will hold a status conference Dec. 13 on efforts to permanently block them.

“Our position is this law is not constitutional and cannot be constitutional without some legislative fixes,” said Witold Walczak, legal director of the American Civil Liberties Union of Pennsylvania.

Wall Street Seeks to Unravel Safety Net

Wall Street Uses Third Way to Lead Its Assault on Social Security

Posted: 11/13/2012 8:51 am
William K. Black

Assoc. Professor, Univ. of Missouri, Kansas City; Sr. regulator during S&L debacle

Third Way, lobbyists for and from Wall Street who are leading the effort to enrich Wall Street by privatizing Social Security, was created by Wall Street to fool some of the people all of the time. I have written previously to expose their fictional claims to be a moderate or liberal Democratic group.

Eric Lautner documented Wall Street’s effort to become even wealthier by privatizing Social Security in articles and his recent book (The People’s Pension: The Struggle to Defend Social Security Since Reagan (AK Press)).

I showed that Third Way makes itself useful by providing a faux “liberal” or “moderate” “Democratic” quote machine that can be used to discredit Democrats and Democratic policies such as the safety net. I gave examples of how Third Way gave aid and comfort to the effort to defeat Elizabeth Warren and the effort to unravel the safety net. Third Way continues to prove that you can fool some of the people all of the time.

The National Journal ran an article on November 8, 2012 entitled “Left Divided over ‘Grand Bargain.'”

“Groups concerned with protecting entitlements such as Social Security and Medicare are finding themselves at odds over whether an overarching fiscal deal during Congress’s end-of-year session would help or hurt their cause.The AFL-CIO organized a day of action on Thursday–part of a broader post-election campaign to protect entitlements–with dozens of events scheduled nationwide to urge lawmakers to avoid such a deal.

A ‘grand bargain’ to prevent the year-end onset of tax hikes and spending cuts ‘could cut Social Security, Medicare and Medicaid benefits, all to give tax cuts to the wealthiest Americans,’ the labor group argued on its organizing site. But the union campaign is being met with resistance from others on the left.

‘We, like you, are ecstatic about the reelection of President Barack Obama and what it means or American growth and prosperity,’ wrote Jim Kessler, senior vice president for policy for Third Way, a liberal think tank with a centrist approach, in an open letter to the groups involved with the day of action. ‘However, as fellow progressives, we were disappointed to learn that you will be leading an effort against the President to impede a balanced grand bargain.’

In order to protect safety-net programs, such as Social Security and Medicare, the left must embrace reform, Kessler writes.”

Let me attempt again to make the basic facts clear. Third Way is not a “liberal think tank.” It does not take “a centrist approach.” It is not run by “fellow progressives.” It is not concerned with “protecting entitlements.” It is not even a “think tank.” Third Way is a creature of Wall Street. It’s version of “protecting” the safety net was made infamous during the Tet offensive in Vietnam when the American officer explained that “it became necessary to destroy the village in order to save it.”

Third Way is the Wall Street wing of the Democratic Party, which seeks to defeat Democratic candidates like Elizabeth Warren running against Wall Street sycophants like Senator Scott Brown and seeks to unravel the safety net programs that are the crown jewels of the Democratic Party. Wall Street’s “natural” party is certainly the Republican Party, but Wall Street has no permanent party or ideology, only permanent interests. Third Way serves its financial interests and the personal interests of its senior executives. Wall Street has always been the enemy of Social Security and its greatest dream is to privatize Social Security. Wall Street’s senior executives live in terror of being held accountable under the criminal laws for their crimes. They became wealthy by leading the “control frauds” that drove the financial crisis and the Great Recession. This is why Wall Street made defeating Warren a top priority.

Continue reading Wall Street Seeks to Unravel Safety Net

Fed Economists Debunk CBO Runaway Medicare Cost Scare

by Randy Shannon

The heart of the argument to cut Medicare is that runaway medical costs will outpace gross domestic product and bankrupt the USA. This argument is based on budget predictions by the Congressional Budget Office (CBO). We heard echoes of this argument in the recent primary and general election: “We will have to do something about Medicare costs.”

These predictions are so bogus that two Federal Reserve economists have debunked the CBO methodology and conclusions as economic malpractice. This is a very significant blow to the “out of control deficit” argument and should be widely discussed and disseminated. Below is commentary on the Fed economists’ paper by economic blogger Yves Smith.

Graph of Healthcare Share of Federal Budget (yellow line) Based on Bogus Congressional Budget Office Predictions

Fed Budgetary Experts Demolish CBO Health Cost Model, the Lynchpin of Budget Hysteria

A remarkably important and persuasive paper that calls into question the need for “reforming” Medicare has not gotten the attention it warrants.An Examination of Health-Spending Growth In The United States: Past Trends And Future Prospects” by Glenn Follette and Louise Sheiner looks at the model used by the Congressional Budgetary Office to estimate long term health care cost increases. Bear in mind that this model is THE driver of virtually all forecasts of future budget deficits.

This paper, although written in typically anodyne economese, is devastating in the range and nature of its criticisms. And the reason this assessment should be taken seriously, independent of the importance of the issues it raises, is that the authors are uniquely qualified to make this critique. Follette is chief of the Fed’s fiscal analysis section. Sheiner, a fellow member of that group, has worked for both the Treasury and the Council of Economic Advisers previously. In other words, the sort of analysis they have made here is the core of what they do on a daily basis.

The argument made by the opponents of the plans to cut Social Security and Medicare generally take this form: concerns about Social Security are greatly exaggerated. They are based on long-term forecasts, which are notoriously inaccurate in outlying years. The most commonly cited, by the Trustees of the Social Security system, projects the exahustion of the famous trust fund in 2033. As several analysts have observed, if Social Security really has a problem, we’ll know it in plenty of time; there’s no need to do anything immediately.

By contrast, conventional wisdom is that Medicare does have a long term cost predicament, but the problem is not demographic, but that of the steep rise of health care costs in general.

The fundamental beef of Follette and Sheiner with the CBO model is that it naively assumes past growth in health care spending as the basis for its long-term projections. The result is that it shows that trees will grow to the sky. One of the things anyone who has build forecasting models will tell you is you come up with assumptions that look reasonable and then sanity check the output. The Fed economists point out numerous ways that the model output flies in the face of what amounts to common sense in the world of long term budget forecasting.

Continue reading Fed Economists Debunk CBO Runaway Medicare Cost Scare

Unions Mobilize to Protect Safety Net

Union members mobilize to protect safety net

November 9, 2012 by William Rogers

Union members joined progressive allies on November 8 at more than 100 local protests against possible cuts to Social Security, Medicare, and Medicaid. The proposed cuts to three of the nation’s most popular safety net programs are on the table as President Obama and Republican Congressional leaders begin negotiations on debt reduction legislation that could be enacted before the current lame duck Congress adjourns in December.

Opponents of the safety net programs, including corporate officers and Wall Street insiders, have insisted that any new budget deal must include cuts to the safety net. The Congressional Progressive Caucus reports that these CEOs and private equity owners have financed “a $30 million lobbying effort to cut Social Security, Medicare, and Medicaid before this Congress goes home for the holidays.”

In response, the AFL-CIO and progressive groups have initiated a grassroots mobilization effort to oppose the cuts. The November 8 actions kicked off the mobilization campaign.

One of these actions took place in Cincinnati, where protestors gathered in front of the local office of US Sen. Rob Portman for a press conference. At the press conference, a young woman, whose son is disabled, described her son’s Medicaid benefits as a lifeline for her family.

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Let’s Not Make a Deal

Let’s Not Make a Deal

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Published: November 8, 2012 305 Comments

To say the obvious: Democrats won an amazing victory. Not only did they hold the White House despite a still-troubled economy, in a year when their Senate majority was supposed to be doomed, they actually added seats.

Nor was that all: They scored major gains in the states. Most notably, California — long a poster child for the political dysfunction that comes when nothing can get done without a legislative supermajority — not only voted for much-needed tax increases, but elected, you guessed it, a Democratic supermajority.

But one goal eluded the victors. Even though preliminary estimates suggest that Democrats received somewhat more votes than Republicans in Congressional elections, the G.O.P. retains solid control of the House thanks to extreme gerrymandering by courts and Republican-controlled state governments. And Representative John Boehner, the speaker of the House, wasted no time in declaring that his party remains as intransigent as ever, utterly opposed to any rise in tax rates even as it whines about the size of the deficit.

Continue reading Let’s Not Make a Deal