Viciously Ageist Cartoon Accompanying James Surowiecki's Article in the New Yorker entitled "Greedy Geezer"

As a guest recently on Sharon Lockhart’s KKFI program “Every Woman,” I stated that the Washington elite’s current assault on Social Security and Medicare is reminiscent of an earlier successful attempt to reduce welfare benefits for poor mothers and children.  Both propaganda campaigns have entailed the promotion of narratives picked up and disseminated by the mainstream media.

Throughout the 1970s, neo-conservatives in think tanks and universities constructed and promoted a narrative of poor mothers needing public assistance as irresponsible, dependent, unmotivated, and inferior.  By 1980, a U.S. president was inspired by these ideologically right wing social scientists (e.g., Charles Murray, George Gilder, and Irving Kristol) to declare that “welfare queens are driving their Cadillacs to the welfare office to pick up their checks.”

Although that statement has been attributed to Ronald Reagan, a Republican, it was left to Bill Clinton, a Democrat, to dish out some tough love to poor women and their children.  His signature policy achievement is known, rather insultingly, as Temporary Aid to Needy Families (TANF).  Even more insultingly, the legislation authorizing TANF is the 1996 Personal Responsibility and Work Opportunity Reconciliation Act.  In its title, this legislation belittles, defames, and dehumanizes poor mothers.  Furthermore it has transformed public assistance for families with children from federal grants in aid to block grants, which places the fate of women in poverty in the hands of typically less empathetic and less resourced states.

So what have been the results of this punitive legislation? According to the Center on Budget & Policy Priorities, “Between 2000 and 2004, the number of children living in families with cash incomes below half the poverty line increased by 774,000” (see the full report at http://www.cbpp.org/cms/?fa=view&id=600).  Although employment rose amongst poor women immediately following implementation of TANF, they remained “poor or near-poor, often face significant work expenses and material hardships and see only modest income growth over time.”  Because TANF limits lifetime public assistance to five years and state welfare agencies became more anti-poor, jobless, single mothers who “do not receive cash assistance and who do not live with others who work or receive cash income support has increased.”

The elderly receiving Medicare and Social Security are now targeted for benefit reductions.  As happened in the case of poor women and children, an “elderly as a problem and a burden” narrative replete with metaphors, symbols, myths, and misinformation has been developing for decades.  Even liberal media such as the New York Times, the New Yorker, and NPR have been promoting and distributing this narrative, which subsumes a sub-narrative of “selfish old people” – especially Baby Boomers – overwhelming the medical system without any concern about the needs of younger people.

A case in point is an article by James Surowiecki entitled “Greedy Geezer?” which appeared in the New Yorker (http://www.newyorker.com/talk/financial/2010/11/22/101122ta_talk_surowiecki).  The article was preceded by the cartoon displayed at the beginning of this post.  The title is obviously a question to which the author’s answer can be summarized as “yes, of course.”  Through speculation, poor logic, lack of factual support, and over-generalization, Surowiecki reaches the conclusion that the 2010 mid-term election results were seniors “essentially saying ‘I’ve got mine – good luck getting yours.”  Perhaps this is the attitude of some seniors.  But it is not my attitude or the attitude of any seniors that I know, and I know a lot of seniors – both conservative and liberal seniors.

Ageism entails three basic elements: (1) stereotyping, (2) scapegoating, and (3) discrimination.  Stereotypes of the elderly as dependent, a burden, selfish, and greedy have been appearing with increasing regularity in the media.  Seniors are regularly scapegoated for budget deficits and national debt caused by a tax structure favoring the rich, several trillion dollars in war-related expenditures, bail outs of Wall Street moguls, and rip offs by the military, medical, financial, and agricultural complexes.

It is proposed that the elderly pay the price for incompetent and corrupt political leadership.  Deficit reduction commissions are springing up all over the place.  The commissions are discriminating against the elderly by recommending that the largest share of the cuts be aimed at senior programs while leaving the monied-elite untouched.

In his nonsensical rambling, Tom Friedman often claims that the earth is getting flatter (see e.g. The World is Flat).  What he means is that the internet has moved economic opportunity across the world’s population.  This is a rather delusional and distorted view of what is happening to the non-rich populations of the earth.  But in one sense, he is correct.  The American middle class is being flattened.

“Trickle down” economics has been, in reality, “trickle up” economics. As Robert Reich has indicated in his recent book Aftershock, in 2007, 24% of all income accrued to the wealthiest 1% of the U.S. population. That’s the worst maldistribution of wealth in this country since right before the beginning of the Great Depression. As recent as the late 1970s, the top 1% earned 9% of all income (page 6).

I recommend Nicholas Kristof’s recent New York Times column for a concise and readable explanation of current income and wealth inequality in the U.S. (“A Hedge Fund Republic?” November 18, 2010).  Citing figures published by the Economic Policy Institute, Kristof points out that “The top 1% of Americans owns 34 percent of America’s private net worth….”  The bottom 90% owns just 29%, which means that the top 10% owns 70%.

There are several macro-economic reasons for the redistribution of wealth in the past several decades.  Taxes are just one reason, but tax codes and the federal, state, and local tax systems in general have been drastically revised in favor of the highest earners and the wealthiest citizens.  The highest marginal income tax rate has been reduced from 70% to 36% while State and local sales taxes (due in large part to a loss of federal transfer dollars) have increased from a low of 2% to 3% in the late 1970s to 8% to 9%.  Consumers are also charged taxes on a variety of services provided by regulated industries such as telephone service. 

Capital gains taxes have been lowered from 25% to 15% since Ronald Reagan took office.  With an increasingly complicated tax code with loop holes that benefit only the wealthy, labor (payroll) has been heavily taxed while capital (capital gains) has increasingly escaped taxation.

The Simpson-Bowles recommendations and the Rivlin-Domenici recommendations for deficit/debt reduction would further flatten the progressive income tax structure and increase regressive sales taxes.  Both sets of recommendations would also increase Medicare and Medicaid payments for beneficiaries and lower Social Security benefits.  A freeze for three years in federal employee and military personnel pay is included in Simpson-Bowles.

Neither plan includes a fair inheritance tax, increase in the capital gains tax, or a financial transaction tax.  Jan Schakowsky’s plan would, amongst other things, do the following:

1. Tax capital gains and dividends as ordinary income.
2. Reform the estate tax with a progressive schedule of marginal tax rates.
3. Eliminate the deduction for business meals and entertainment.
4. Limit the deductibility of financial corporate debt interest payments.

She has recommended a host of other tax revisions that would reduce the deficit by hundreds of billions of dollars by 2015 without putting a heavier burden on middle and low income Americans.  This is the opposite of the other deficit reduction plans.

Jan Schakowsky: A Congress Woman Who Works for the People

Deficit reduction plans are coming from all directions – mostly from the right.  We have the Simpson-Bowles plan, the Rivlin-Domenici Plan, and one which I haven’t had time to thoroughly read yet, the Peterson Foundation-Pew Foundation Plan.  These plans relieve the upper classes of any responsibility and burden for the deficit but come down hard on the working classes.

One member, and only one member, of all of these commissions is a progressive with the best interests of the working folks in mind.  That person is U.S. Representative Jan Schakowsky. As a member of President Obama’s deficit reduction commission, she has, in an act of admirable courage, taken on the Washington elite by issuing her own deficit reduction plan. 

She lists the following guiding principles of her plan:

1. Achieve deficit reduction and stabilize debt without harming lower-income and middle-class families.
2. Create jobs and restore economic prosperity.
3. Make investments to keep America strong and competitive – and raise sufficient revenues to fund them.
4. Provide shared opportunity and reduce unprecedented income disparities.
5. Solve problems – don’t shift costs and burdens to families and businesses.

These principles are far different than anything you will find in the elitist plans coming out of right-wing foundations (e.g. Bipartisan Policy Center, Peter G. Peterson Foundation, etc.) or the President’s deficit reduction commission.  As opposed to raising taxes on the middle class and poor through regressive consumption taxes (in the other plans), she would raise capital gains taxes from the current 15% level to the same level as income taxes that everyone else pay.  In addition, she would eliminate many of the corporate tax breaks that encourage corporations to ship their factories and jobs out of the country.

Jan Schakowsky’s plan can be found at http://www.janschakowsky.org/; pdf at https://secure.mydccc.org/o/30047/images/Schakowsky%20Deficit%20Reduction%20Plan.pdf

Today, the masses were hit by the other half of a flying wedge.  Alice Rivlin, friend of and mouthpiece for the monied elite, and conservative former Senator Pete Domenici released a 140 page set of recommendations which are even worse than the set of “assaults” unleashed on the economic security of middle and lower income Americans by Alan Simpson and Erskine Bowles .  Like the Bowles and Simpson recommendations, the Rivlin and Domenici recommendations lower taxes for the rich, increase taxes for everyone else, and reduce Social Security and Medicare benefits.

Both sets of recommendations have an extensive number of reductions in retiree, civil service, military personnel pay and retirement benefits.  The Tallgrass Activitist will be explaining these over the next few weeks in detail  Such a large and obfuscated set of recommendations have been dumped out of these commissions in the past week, that a single blog post would be impractical.

What you won’t find in either set of recommendations is a call for the super-rich to carry their fair share of the burden.  Neither will you find a recommendation to legislate a single payer, universal health care system into existence.  Without that, health care costs will not be brought under control.  Instead, the power-elite representatives on these commission are calling for increased premiums and reduction in benefits.

All of the burden – and I mean all of it – is falling on “non-rich,” “non-power-elite-connected,” Americans.  Watch for details in the days and weeks ahead.

Erskine Bowles

Blue Dog Democrat Erskine Bowles and former Republican Senator Alan Simpson, co-chairs of President Obama’s so-called deficit reduction commission, have, metaphorically speaking, delivered a big slap to the face of middle and low income Americans.  This slap has come in the form of 50 slides simply entitled Co-Chairs’ Proposal, which are loaded with technical terminology related to arcane aspects of Medicare, Social Security, and fiscal/tax policy.

Why is this document and the process by which it has been produced so contemptuous and disrespectful to all of America but Wall Street and the rich?  First, it was conceived in secrecy, without public input, and unloaded on the public as a tactic in a larger strategy to further lower the standard of living of the American middle class.  It is highly unlikely that these recommendations will be endorsed by the required 14 of the 18 members of the commission – a requirement for an up or down vote by congress. 

Simpson and Bowles knew that and also knew that their proposals would generate an extraordinary amount of noise and bloviation.  Their grand strategy is to enlist mainstream media in their propaganda, including such faux-liberal media outlets as the New York Times, NPR, PBS, and MSNBC’s Hardball.  They fully intend to push the entire package in a piecemeal fashion.

Second, it is no coincidence that this austerity program for the masses is being unleashed in conjunction with assaults on social programs throughout Europe.  We have to see this move as part of the globally integrated and financialized economic system.  The IMF, the World Bank, the WTO, and the OECD have evolved into a quasi World government on behalf of the financial services industry and investors. For the past several decades, these organizations have forced “bitter medicine” down the throats of Third World Countries, Southeast Asian countries (after the late 90s financial crisis), Russia (after Perestroika), and South American countries (since the 1970s).

 In every case, banks and investors were either enriched or bailed out while social programs were diminished and workers were put out of work.  It is now the masses of the advanced industrial societies, e.g., the U.S., England, and France who must pay the price for an economic collapse caused by the international financial casino.

Third, the whole package is duplicitous and dishonest.  It is supposed to be all about deficit reduction and saving the U.S. economic system.  Slides # 3, 4, 5, 6, and 7 contain 10 “guiding principles and values.”  For instance, principle one is stated as follows: “We have a patriotic duty to come together on a plan that make America better tomorrow than it is today.”  Other principles indicate that “the solution must be painful,” “it is cruel to make promises we can’t keep,” “protect the truly disadvantaged,” and on and on with platitudinous justification for some economic tough love.  But let’s look at what jumps off the pages of these recommendations:

• Slide 20:  Freeze non-defense federal salaries for three years and cut the federal workforce by 10%
• Slides 23, 24, 25, 26, 27:  Lower corporate and upper income level taxes and eliminate middle class tax deductions.
• Slide 29:  Increase gas tax by 15 cents and change to a “chained CPI” (the chained CPI will unfairly result in a reduction in Social Security and other cost of living increases).
• Slides 31, 32, 33,34, 35:  Increase co-pays for Medicare beneficiaries and reduce payments to doctors.
• Slides 43, 44, 45, 46, 47, 48, 49, 50:  These slides pertain to Social Security.  The recommendations include increasing retirement age (slide 45).  There are a few good things such as raising the taxable maximum to capture 90%; however, this would be phased in by 2050.  

Fourth, and finally, the proposal is as outrageous for what it doesn’t include as what it does include.  Although there are plenty of benefit reductions for the masses and tax cuts for the rich, you will not find the following amongst the proposals:

• A sensible inheritance tax.  As it stands now, there is no inheritance tax.  In fact, in 2010, there is literally no inheritance tax.  Heirs of multi-millionaires and billionaires this year will pay no taxes on what they inherit.  In other years, slick tax accountants help the super-rich and the not so super rich avoid inheritance taxes with gimmicks in the tax code.
• A financial transaction tax.  A small tax on financial transactions would be hardly be felt by the moguls on Wall Street but would generate enough revenue to cover a significant amount of the gap between expenditures and revenue.  Even though it was the speculation and gambling of financiers that caused economic collapses across the past few decades, they are not forced to bear even a small part of the pain.
• Increase in the capital gains tax, even for the billionaire hedge fund managers who should be paying taxes at the same rate as every other income earner (as opposed to investor).
• Elimination of the Bush tax cuts for the rich.  Need I say any more about that?  It looks as though President Obama is ready to cave on that one.  But you can bet he will take the Simpson-Bowles insult to salary and wage earning Americans seriously.

This post has been a very brief overview of the co-chairs recommendations.  The recommendations should not be taken seriously but they will be.  You will see the likes of Alice Rivlin on the PBS Nightly Business Report pontificating about the need to make hard choices.  But this whole process is all about the bond markets.  In spite of the bone or two thrown to the masses, the suffering will be felt by middle and low income Americans and benefits will accrue to investors and corporations.  Having commandeered the IMF and World Bank, this has been the pattern of the global economic elite for the past several decades.

I will keep blogging about this very serious attempt to take down the middle class.  Or, I should say, a serious attempt to take us further down.

Siemens Executives Selling Medical Imaging Equipment

By virtue of the U. S. Supreme Court majority opinion in Citizens United (slip opinion available at:  http://www.scotusblog.com/wp-content/uploads/2010/01/citizens-opinion.pdf), corporations have been rendered human with all the constitutional rights of any individual citizen.  It would seem to follow that corporations would also have all of the responsibilities and obligations of any regular human being.  It would also seem to follow that Siemens, the gigantic German conglomerate, could be hauled into the Hague and charged with war crimes for it role in extermination of Jews, Gypsies, homosexuals, communists, and anyone else who found themselves on the wrong side of Himmler’s SS.  Instead, it is a seemingly upstanding member of the U.S. Chamber of Commerce. 

In spite of the role this notorious natzified company and the natzified Siemens family in the Holocaust, Siemens is doing quite well at the expense of the U.S. taxpayer.  In particular, Medicare has been enormously profitable for this multinational conglomerate.  With the coming of health care reform, Siemens is looking to make unprecedented enormous profits.  I will discuss this “citizen corporation’s” past and then examine its U.S. health care business.

Siemens was a leading corporate participant in Hitler’s “death through work program;” with slave labor factories at the following death camps: Auschwitz, Buchenwald, Flossenberg, Gross Rosen, Mauthausen (Austria), Neuengamme, Ravensbruck, and Sachsenhausen (see Christopher Simpson, The Blond Beast: Money, Law, and Genocide in the Twentieth Century, Common Courage Press, 1995, pp. 290-310). 

In addition to the profitable business of working people to death at Nazi concentration camps, Siemens did quite well in the so-called “Aryanization Program,” which was essentially the expropriation of Jewish businesses for resale at bargain basement prices to approved German companies.  In 1936, the Frankfurter Zeitung, the mainstream business newspaper in Hitler’s Germany, listed “twenty-one very large transfers and consolidations in 1934; most were forced buyouts of multi-million dollar Jewish firms by their German competitors.  In 1935, thirty-two such large contracts were reported, including two major acquisitions of Jewish firms by the Siemens group… .” (Simpson, The Blond Beast, p. 62).

Siemens general director during the Holocaust, Rudolf Bingel, was one of the senior German business leaders active in the notorious Himmlerkreis, the Circle of Friends of Reichsfuhrer SS Heinrich Himmler.  “The companies represented in Himmler’s circle became pacesetters in Aryanization, exploitation of concentration camp labor, seizure of foreign companies in the occupied territories, and similar business ventures that depended on SS cooperation” (Simpson, The Blond Beast, p. 154-155).

As Benjamin Farencz documented in Less than Slaves: Jewish Forced Labor and the Quest for Compensation (1979, Harvard University Press, pp. 116-122), Siemens, due to its lack of willingness to own up to its enslavement of Holocaust victims and theft of Jewish property, has not exactly been a remorseful citizen.  In spite of the corporation’s image advanced through its “touchy feely” television ads, it is not a “moral” entity given to remorse and redemption.  It has fought “tooth and nail” against victim organizations’ attempting to obtain admissions of guilt and reparations.

For these multinational conglomerates, the guiding ethic – the summum bonum, if you will – is profit, i.e. the bottom line.  As a manufacturer of medical devices, Siemens has a large share of the health care business generated by the rapidly expanding medical imaging business.  According to a medical device trade publication, “Siemens, Royal Phillips, Toshiba, and General Electric are benefitting from a 30 percent-per-year increase in the use of imaging tests such as PET scans for elderly people with cancer” (http://www.topdevicecompanies.com/2010/04/siemens-philips-toshiba-ge-pet-scans-grow-by-third per-year.html).

The overuse of medical imaging is of increasing concern to medical researchers (see, e.g. Dinan, et al. “Changes in the Use and Costs of Diagnostic Imaging among Medicare Beneficiaries with Cancer, 1999-2006,” JAMA, 303-16, 1625-1631, November, 2010).  A report of the Congressional Budget Office in 2008 listed diagnostic imaging as a leading cause of health care cost inflation (“Technological Change and the Growth of Health Care Spending, p. 16).  In essence, rather than being treated as patients Medicare and Medicaid recipients are being treated as commodities for the profit of medical device manufacturers and physicians who purchase their equipment. 

Now that these multinational behemoths can pour money into Chamber of Commerce efforts to control the U.S. government, the commoditization and colonization of the U.S. population will only become more complete.  In fact, the U.S. Chamber, in an award to Siemens, described the company thusly: “a global powerhouse in electronics and electrical engineering, and operates in the industry, energy, and health care sectors” (http://www.uschamber.com/press/releases/2010/april/us-chamber-and-siemens-corporation-announce-finalists-national-sustainabil).  With 405,000 employees in 190 countries, Siemens reported worldwide revenue of $104.3 billion in fiscal 2009 with $21.3 billion in U.S. revenues.

The point of this post is that the global, capitalist elite, with the Citizens United decision for legal cover and operating through the U.S. Chamber of Commerce and other front groups, are treating the United States like a colony and taking excessive profits from government funded programs.  Given the past of Siemens, it is clear that humanness and morality have no bearing on corporate behavior.  While our jobs are shipped to Third World economies, we are forced to dump untold billions of our tax dollars into wasteful, unnecessary medical practices for the profit of multinational corporations.