DEFICIT REDUCTION, “LIBERAL” MEDIA, AND CLASS WARFARE: YESTERDAY’S VOTE OF THE PRESIDENT’S DEFICIT REDUCTION COMMISSION

Brooks & Marcus on PBS: A Phony "Two Sides of the Issues Give and Take

Most everyone has heard by now that Simpson and Bowles were able to garner 11 votes for their set of deficit reduction recommendations.  They needed 14 votes from the 18 member commission.  Members on the “far right” and the “far left” (however those terms are defined) voted no and hence left Simpson and Bowles three votes short.

This is not in any sense of the word good news.  Let’s just consider how it was handled on Jim Lehrer’s PBS Newshour conservative-liberal give and take segment (http://www.pbs.org/newshour/). There is a reason that neo-conservative David Brooks and the not very liberal Washington Post columnist Ruth Marcus were absolutely giddy about the 11 votes for the Simpson/Bowles plan. They expressed effusive praise for those commission members willing to “make the hard choices” (such as reduction in Medicare and Social Security) and believe that yesterday’s vote is a harbinger of future action.

Brooks and Marcus could more aptly be said to have had a conservative versus extremely conservative give and take.  It was, in their view, a surprise that 11 of the 18 members of the commission would actually support draconian Social Security and Medicare cuts.  It was also, in their view, a matter of time until Congress is willing to muster the courage to vote these recommendations into law. 

I find it very interesting that this conservative-liberal give and take included nothing about Simpson’s and Bowles’s recommended tax cuts for corporations and the wealthy as well as nothing about their recommended regressive tax increases for low and middle income classes.  This is why liberal support for public television puzzles me.  I will probably anger some liberals by saying this, but I believe PBS, like NPR, has become a propaganda outlet for the ruling class. Given that their underwriters include Bank of America, EXXON, the Kauffman Foundation, etc., I am not surprised that they don’t really present a progressive side of issues.

I must apologize to those liberals and progressives who don’t like to talk about “war,” and think that terms like “class warfare” are best left unsaid.  The fact of the matter is, however, that a class war is being waged on middle and lower income classes right now.  It has been going on for some time.  Perhaps, it would be a good idea for those who don’t think that we should call it “class war” to reflect on a few phenomena:

  1. Wages and salaries have been stagnant for some time for all but the very high paid and very rich.
  2. The cost of college has been outstripping inflation for the past thirty years and is becoming increasingly unaffordable for middle class families.
  3. Twenty-five percent of the U.S. working-age population is either unemployed or underemployed while corporations and the financial services industry continue to reap record profits and pay obscene salaries and bonuses.
  4. Young people are graduating from college with an inordinate level of college loan debt and with few prospects for all but the most menial employment.
  5. Although she went to prison for saying it, Leona Helmsley was telling the truth when she said “We don’t pay the taxes, the little people pay the taxes.”
  6. In 2009, corporate America spent $3 billion on lobbying the U.S. Congress and was able to lock up control of the U.S. government through a Supreme Court case entitled Citizens United.

The quality of life for the middle class is sinking.  Furthermore it will continue to sink and life will become increasingly difficult for everyone and every family below the wealthiest few percent.  The first step in fighting back is to recognize the truth; to come to grips with reality; to stop believing media propaganda; and to stop thinking that the Democrats and the Obama Administration will take up our cause unless we, en masse, begin to demand a change.

Call your PBS and NPR local stations and tell them you will not contribute any money to them until they begin to press the national NPR for fair and balanced news and analysis.  Demand that we hear the other side.  I have had several conversations with Patricia Cahill at KCUR and can tell you that she is a sensitive and open-minded manager and a generally all around good person.  She will pass your comments along to the national offices of NPR (she is also on the NPR board of directors).

FROM WELFARE QUEEN TO GREEDY GEEZER: WITH THE HELP OF THE MEDIA, THE MONIED-ELITE NOW TURNS ITS ATTENTION TO ITS NEXT SET OF VICTIMS

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.

With the Exception of Jan Schakowsky’s Plan, Current Deficit Reduction Plans Will Accelerate Wealth Redistribution in Favor of the Wealthiest Americans

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’S DEFICIT REDUCTION PLAN: A TRUE PROGRESSIVE PLAN FOR THE WORKING PEOPLE

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

Rivlin & Domenici Recommendations as Outrageous as Bowles & Simpson: The Middle Class Pays the Price for Wall Street Profligacy & Corporate Greed

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.

THE RECOMMENDATIONS OF PRESIDENT OBAMA’S DEFICIT REDUCTION COMMISSION CO-CHAIRS: AN OUTRAGEOUS ACT OF CONTEMPT FOR MIDDLE AND LOW INCOME AMERICANS

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, A MULTINATIONAL GERMAN CORPORATION, IS A LEADER IN RIPPING OFF THE U.S. HEALTH CARE SYSTEM WHILE EVERYONE IGNORES ITS EXTREMELY UGLY NAZI PAST

 

 

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.

THE KOCH FUNDED CATO INSTITUTE WAGED GUERRILLA WARFARE ON SOCIAL SECURITY AND THE MAINSTREAM MEDIA BOUGHT IN TO IT.

In 1983, the strategy for destroying Social Security was clearly expressed in the Cato Journal (“Achieving a Leninist Strategy,” vol.3, no. 2).  The Cato Journal is the pseudo-scholarly publication of the Cato Institute, which is a Koch funded Washington, DC “think tank.”  The article, by Stuart Butler and Peter Germanis, recognized that “a firm coalition behind the present Social Security system” had been politically effective.  They concluded, therefore, that it is necessary for opponents to, “begin to divide this coalition and cast doubt on the picture of reality it presents to the public” (page 548).

Butler and Germanis stated that they must also construct a coalition “that will gain directly from implementation” of a plan to privatize Social Security.  They suggested that such institutions as banks and insurance companies, seeing the profits to be made from privatization would be likely allies (page 549).

Recognizing that “the elderly represent a very powerful and vocal interest group,” (page 549), the authors set forth their second main strategic element, which, as they stated, “involves what one might crudely call guerrilla warfare against both the current Social Security system and the coalition that supports it” (page 552).  And indeed, for nearly three decades, a “guerrilla war” has been waged on the Social Security system and the coalition that works to protect and maintain it. 

This war has been waged primarily with misinformation about the nature of the Social Security system and its impact on the fiscal problems of the federal government.  The Social Security program has amassed a 2.5 trillion dollar surplus and is adequately funded, without any adjustment, until 2037, and, with a small amount of tweaking, into the foreseeable future after 2037.  The misinformation, perhaps disinformation, however, is that Social Security is “going bankrupt” and is putting a strain on federal finances; i.e., it is a cause of the federal deficit.  This is absolutely false.  In covering a deficit caused primarily by wars and ill advised upper income tax cuts, the federal government is borrowing from the Social Security Trust Fund.

Has this guerrilla war on the elderly and the successful and well run Social Security safety net program been effective?  Yes.  The mainstream press overwhelmingly takes its cues from the anti-Social Security forces and passes along the misinformation disseminated by conservative think tanks.  Just today, a front page New York Times article on the deficit primarily blamed Social Security and Medicare for the current budget mess in Washington (“Divide on Deficit Likely to Grow After Election,” 10/26/2010).

The author, Jackie Calmes displayed her ignorance by blaming “an unsustainable combination of fast-growing entitlement programs like Social Security and Medicare and inadequate tax revenues” for the current budget deficit.  As usual, the “baby boomer” generation is scapegoated in this article.  Ms Calmes quoted David Cote, the chief executive of Honeywell International, and a known anti-Social Security hardliner on President Obama’s deficit reduction commission.  Here is what he had to say: “the thing that shocked me was that the debt crisis had been predicted for decades because of the costs of federal benefits for the baby boom generation.”

This imaginary entitlement crisis caused by the baby boomers is never questioned.  An objective, informed challenge to this slur on people in a single age range, is never presented in the New York Times, on PBS, NPR, or in any other mainstream media.  The maligned group of people born between 1946 and 1964 (and others) has paid enough into the Social Security system to pay benefits to the generation preceding them as well as enough to take care of themselves until 2037.  They are now scapegoated for one war costing several trillion dollars, another war running $100 billion per year (in its ninth year), tax cuts for the wealthy costing another $1 trillion over the next decade, and an on-going defense expenditure of $1.1 trillion per year.

This is how well-funded guerrilla war is supposed to work – especially when there is very little push back by powerful media entities.  Social Security, Medicare and the selfish baby boomers as causes of impending fiscal doom is accepted as nothing less than a truism in the mainstream press. 

The good news is that a network for taking on the anti-Social Security guerrillas is forming and forming rapidly.  For instance, labor unions, the NAACP, Older Women’s League, NOW, Gray Panthers, and hundreds of other organizations are coming together into one coalition know as “Strengthen Our Social Security.”  Check it out at http://strengthensocialsecurity.org/.  Local and regional coalitions are also coming together.  In Kansas and Missouri, the “Save Our Social Security (SOS)” coalition is coming together.  The http://sostakeapledge.com  website will be up in a matter of days.

THE HOLLOWING OF THE U.S. ECONOMY AND THE COLONIZING OF THE U.S. POPULATION

IBM - A U.S. Grown Company Wiping Out U.S. Jobs While Taxpayers Pay for Its Goods & Services

Through disinvestment in the U.S. economy and investment in developing economies such as Brazil, India, and China (BRIC), the global, capitalist elite is hollowing out the U.S. economy.  Jobs – even high skilled, high paying jobs – are leaving the U.S. for cheap BRIC labor markets.  Worse yet, global oligarchs are beginning to treat the U.S. like a colony. 

Consider IBM’s current outsourcing of jobs – just one example of this colonizing tendency.  IBM, a company conceived and grown in the U.S. into a multinational, corporate behemoth, employs 400,000 people world-wide with 105,000 left in the U.S.  IBM has reduced its U.S. payroll by 30,000 since 2003.  Conversely, since 2003 it has grown its skilled labor force in India from 9,000 workers to 75,000 (see New York Times Business, Tuesday, October 20, 2010, page B3).  This is the “hollowing out” part of the equation.

The colonizing part involves the purchase of IBM products by American public universities and state and federal government.  Approximately one year ago, IBM purchased SPSS, a company providing statistical software to colleges and universities as well as to state and federal governments.  In higher education SPSS™ is available on a site license for use by faculty and staff.  Kansas University alone pays approximately $100,000 per year for a site license.  Students who often need it or are required to use it for research and course work must purchase a student version for approximately $200. 

Much like SAS™, another statistical package spun out of an American university, SPSS grew into a highly profitable corporation, headquartered in Chicago, with a large, highly skilled workforce of statisticians, programmers, and sales people.  I know this because I have been working with and teaching SPSS™ for several decades.  On several occasions I visited the SPSS corporate offices for training and other business purposes and saw several floors of a high rise office building on the Miracle Mile occupied by SPSS employees.  They will be gone soon.

The question becomes, “To what extent will government purchase goods and services developed with U.S. ingenuity and resources but manufactured by cheap labor in developing economies?”  The state taxes used to purchase these products are, to a large degree, regressive sales taxes collected on food, clothing and other necessities of life.  No matter how poor we become, a large share of our income will be diverted to state and local taxes.  At the same time, opportunities for a living wage will continue to shrink.

The current economic malaise is not temporary.  The suppression of U.S. wages and increasing unemployment are not due to a historical cycle of economic expansion and retrenchment.  The U.S. economic system has been undergoing restructuring for decades.  In the 1970s, the share of national income going to the top 1% hit a floor of 8%.  Since the beginning of the Reagan Administration the share of income going to the top 1% has risen to 23% – the same level it reached immediately preceding the Great Depression (see Robert Reich’s recent book Aftershock, pp. 19-21). 

One cause of this redistribution/maldistribution of wealth can be laid at the door step of the U.S. Congress.  Just three decades ago, state and local sales taxes combined rarely exceeded 2%.  As capital gains, inheritance, and progressive income taxes have been slashed over this period of time, regressive sales taxes have risen in most locales to 8, 9, and even 10%.  Conservative fiscal policy, which mostly benefits the upper income tier of the U.S., has resulted in a diminishing amount of federal dollars going to state and local governments for public assistance, Medicaid, and other programs, which inject money into state and local economies.

Colonialism, as I am using it in this post, simply means that a society’s resources are exploited by outside forces that have no interest in the well-being of the exploited society and its people.  Colonizers in this sense take but give nothing back.  Governance is also manipulated and controlled by the colonizer, which, in the case of the U.S. economy, is the network of global capitalists.  For instance, through the U.S. Chamber of Commerce and the National Association of Manufacturers, global elites, given carte blanch by the U.S. Supreme Court in the Citizens United case, are funneling hundreds of millions of dollars into the 2010 elections.

CLARK COAN ON THE KOCHS

Through billions of dollars poured into elections,  funding of political front groups, and fomenting of Tea Party protests,  Bill and David Koch are attempting to weaken democracy in the United States.  If you don’t know much about the modus operandi of these two fanatical right wingers, I suggest that you spend some time reading Jane Mayer’s article “Covert Operation” in the August 30, 2010 issue of the New Yorker. 

I appreciate articles exposing the Koch’s shenanigans and encourage anyone to write them and send them to The Tallgrass Activist.  People should know what Bill and David Koch are up to and how they go about their sleazy political business. 

The following letter by Clark Coan appeared in the Lawrence Journal World:

 Lawrence, KS

 September 26, 2010

Billionaire Charles Koch reportedly runs privately held Koch Industries as an autocrat, so a case can be made that he is responsible for any malfeasance.

In 2000, a federal grand jury issued a 97-count indictment against the company for knowingly releasing 91 metric tons of benzene and concealing this crime from regulators. The company was subject to $350 million in fines, and four Koch employees faced a combined total of 100 years in prison and $50 million in fines.

Also in 2000, the Justice Department imposed a $30 million fine against Koch, the largest civil penalty ever levied against a company under federal environmental laws. It was determined that Koch was negligent in causing more than 300 oil spills that polluted waters in six states, including Kansas.

A federal jury issued a verdict in 1999 that Koch Industries had, “purposely falsified oil measurements on federal and Indian lands, a practice that allowed it to collect more oil than it paid for. Several Koch employees testified that they were instructed to alter their measurements. Koch Industries admitted it received about $170 million worth of oil it didn’t pay for.”

To paraphrase Balzac, “Behind every great fortune lies a great crime.” Maybe several crimes.