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Category Archives: Jobs

Because I’ve learned that blogging requires relatively short commentaries I have broken this post down into two parts to make its consumption more palatable.  Both may be too lengthy for some but brevity is seldom my better suit.  Thanks for your indulgence.

“Unless we change direction, we are likely to end up where we are headed. “ - Chinese proverb 

We urgently need to generate job growth but not in energy fields where supplies are running out, costs to find, gather and protect those dwindling sources will only escalate and their use will have significant adverse impacts on personal health as well as the health of the eco-system we all depend on for clean air, water and adequate food supplies.

Do some jobs take more from us than they give?


A fable: A snake lover was taking a nature walk when he felt a sting on one ankle.  As he looked down he saw a snake that was moving away from him.  Because he was a lover of snakes and felt sure snakes only bit defensively when threatened, he didn’t think it was the snake that bit him but that a sticker weed in the high grass at the edge of the trail had caused the slight pain. Or so he convinced himself.  He kept on walking but soon collapsed.  The next day his corpse was found on the nature path by another hiker.  The man’s body was taken to the medical examiner’s office who determined that the cause of death was due to toxic venom in his blood, most likely from a snake bite.

Today it seems like many on the far right are like that snake lover.   The evidence abounds but contradicts what they have chosen to believe about things like global warming, industrial pollution and trickle down economics.  Some of their views are relatively accurate but misdirected like the one that asserts we’re losing our personal freedoms as a result of government over reach when in fact government is being taken over by wealthy corporate interests to create policies and perceptions that too often disregard the rights of individuals. The belief by some that free markets are infallible is a misconception that could lead to the elimination of a strong middle class.

There is an ideological bloc in this country that preys on poorly informed people, especially those of a conservative stripe, that insists we must choose jobs over environmental threats, contaminated water, air and food, and lower wages without benefits.  Their argument is less concerned about job creation than it is about protecting their own self-interests, which is always searching for ways to find greater profits.

Unemployment is a real-time crisis whereas environmental consequences appear to be something we can deal with down the road.  What we actually don’t see or feel is less likely to influence us.  Toxic air and water at low levels can go unnoticed for years whereas the immediate affects of no income from joblessness threatens individuals and families today.  Without an income it is argued, all other things are impossible.

The perception conveyed here is that some ill effects from doing business will occur but the markets will prevent excesses or pushing things beyond the envelope that threaten the self-interests of capitalistic endeavors.  How ironic that there is a fervent belief amongst many zealots of laissez faire capitalism that the markets will protect us while casting pejoratives on an “overreaching government” who some may claim will also watch out for the general welfare of its citizens.  Both are designed and impacted by fallible humans yet somehow free marketers believe in an invisible hand of the market as if were controlled by an unseen omniscient and benevolent force.

“The propagandist’s purpose is to make one set of people forget that certain other sets of people are human.” -Aldous Huxley

The core values of capitalism is that entrepreneurship is the engine of economic success along with its corollaries that not all people are promised great fortunes and government intervention obstructs economic success.  An element of truth exists here but adherents to Miltonian free markets and Ayn Rand lassiez faire economies circle the wagons around these concepts and defend them as if they were totally inflexible.  Ascribing an inertia to them allows them to ignore the weakness of there claims and like the fundamentalist christian prophets who claim the Bible is the “inerrant word of God”, the capitalist credo is to be interpreted likewise as defined by the corporate prophets from that Libertarian mountaintop.

This sacrosanct view was pretty much turned on its head in 2008 as the housing mortgage bubble burst and large unregulated financial systems went belly up, requiring massive amounts of bailout funds from that government that was expected to keep it’s distance.  This utter failure of the free markets stunned its supporters and as they wandered aimlessly amongst the wreckage that occurred under a White House and Congress that were mostly members of the same economic view as them, they were lost to explain what was a plain and simple fact – their views of an inerrant word had been a sham.

But like the Old testament prophets who helped the “chosen people of God” rise from their defeats, rather than admit that maybe they got it wrong about who they were and what they were there for, the calamities they incurred were instead seen as the result of a tainted faith, a following that did not adhere to the strictest precepts of the code that God allegedly laid down for them.  They needed to re-do themselves and purify their beliefs, following every dot and tittle written down and castigate, ostracize and put to death any one of them that stepped outside these rigid expectations.

So from the ashes of the financial market meltdown comes the TeaParty phoenix from the small band of libertarians that have been around for decades but on the fringes, hollering out to everyone else about the purity of their views.  This time the core constituencies in this country began to listen because the economic devastation was so massive beyond anything most of them had seen in their lives.  The stereotypical spending Democrat and the pro-corporate Republican that always bestowed federal largesse upon special interests groups were the cause for our failures and need not be trusted.  Caught up in the surface common sense of it all, many who wouldn’t know a libertarian from a lemming jumped on this initial grass-roots movement to go after a government that had failed us.

[Adam]Smith (father of capitalism) roundly mistrusted businessmen. … [H]e insisted that businessmen, for all they may talk of freedom and fairness, “generally have an interest to deceive and even oppress the public.”Adam Smith: An Enlightened Life by Nicholas Phillipson.  

But the surface message that packed so much power at first has faded with time as the devil in the details become apparent and the corruption of the movement exposed.  Government wasn’t the direct cause of our ills.  It was the capitulation of government to the whims of what Eisenhower referred to in his farewell address – the military-industrial complex – that small sector of our economic system that generated great wealth for this nation, especially for the few entrepreneurs who controlled large companies that during WWII put out the planes, ships and weaponry that overwhelmed and defeated the militaristic nations of Germany and Japan.

In this victory however we transplanted ourself as the military giant out of the initial need to secure the global threats out there to prevent a WWIII.  But, now enters one of the flaws of unregulated free markets and its precept about profits.  This behemoth that helped secure our freedom from  foreign despots had developed a life of its own and needed to be continually fed.  There was after all the need to provide jobs for returning vets who, when they first left, the economy was still struggling some to relieve itself from the Great Depression.  But also, there was now a greater global need that the U.S. could serve to help those countries in Europe and Asia that had been devastated by the war, furnishing needed essentials to help them rebuild.

This noble and generous act however led to a pattern of behavior that was on-going and when the government began subsidizing private interests to take over this chore, a global market was developed, revolving around consumption.  Not the type of minimal consumption to sustain oneself but the profit motive type of consumption that free marketers in Adam Smith’s day never envisioned. Wealth grew to a level that would have put to shame the richest aristocrats in early America.

“Capitalism has defeated communism. It is now well on its way to defeating democracy.”  – David Korten

Every conceivable need or want that made our life even just a shade more simpler and happier became a growth industry and through skillful marketing techniques the free market euphoria amongst some developed a culture of consumers that came to believe that having everything we ever wanted was part of the pursuit of happiness our founding fathers alluded to in our primary documents that formed this nation.  Little was thought of concerning the consequences of over consuming and the processes required to make the goods that we felt compelled to buy.  America was a new and vast domain.  The notion that there would never be enough resources to constantly supply us with the wherewithal to pursue this lifestyle indefinitely or the room to dispose of it all just simply never struck a chord with many.

In its early post war days this new found wealth in America’s economic growth benefitted most of it’s citizens but not simply by virtue of the jobs that were created.  Through government policies and regulations to curb corporate excesses, a strong middle class was formed.  This nation had learn from an earlier decadent period in the late 19th century where the wealth of a few had been derived by paying unlivable wages to laborers with no health care benefits and forcing most of them to often produce their products in unsafe and unhealthy environments.  Capital was hoarded by a small elite and the ability of most hard working Americans to get a great education to advance themselves and own a home was an unrealistic goal for low and middle income families.

Tomorrow: 

HOW WE GOT TO THIS POINT

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30 Major U.S. Corporations Paid More to Lobby Congress Than Income Taxes, 2008-2010 


How a party can so nakedly represent only the top 1 percent while at the same time try to stop anything that will help the economy, and survive while doing it, is just beyond me.” – Michael Tomasky

Look for the usual talking points from those who support the GOP and the anti-tax propositions they put forward as they allow efforts to re-instate the 6.2% payroll tax on workers’ wages.  The President is not only trying to keep the lower rate in place but wants to reduce it further for workers and employers and pay for it by hitting millionaires with a 3.5% surtax.  I’m sure we’ll hear a lot about trickle-down economics and how allowing the wealthiest to keep all of their income will create jobs.  We know that’s bunk.

The 2% payroll tax deduction that was part of the deal that the Obama administration made with Republicans last December in exchange for continuing the tax cuts to the wealthiest 1% is due to expire at the end of this year and the GOP leadership is willing to allow that to occur.  These are the same people that holler for tax cuts then scream if they are reinstated to cover the deficit, calling them tax increases.  And you can bet your bottom dollar they will vigorously work to extend the Bush tax cuts for the rich due to expire at the end of 2012, unless the voters wise up and reduce them to an insignificant minority in this next election cycle.

As Michael Tomasky points out in his informative piece, GOP is Set to Self-Destruct Over Payroll Tax”, the Republicans in the Senate will oppose this tax relief for most working Americans because it means the millionaires will have to ante up 3.5% of what they make over $1 million dollars to cover the revenue loss.  In other words, if a person makes $1.1 million they will have to pay an extra $3500 in taxes on that $100, 000, reducing their income from $1,100,000 to $1,096,500.  How will they ever keep up appearances over this tragic loss?

But of even greater hypocrisy on the part of GOP/TeaParty is that this extended tax break to the 99% will also apply to employers who net less than $5 million in revenue each year.  This new deal will also give all employers a further tax break by not collecting any payroll taxes for any new hires they bring on board.  The surtax on millionaires will take care of this shortfall.  “So the new bill is specifically aimed at helping the job creators,”  says Tomasky.  “The total cost is $255 billion.”  In other words, the Party that endorses the “Job Creators” in this country wants to hurt job creation.

Republicans … say (as they say of everything) that [the payroll tax cut] hasn’t done any good. But economists attest to its stimulative value. Two economists at the Economic Policy Institute say ending the holiday would reduce GDP by $128 billion and cost 972,000 jobs in 2012. The EPI is a liberal outfit, but Mark Zandi of Moody’s, who advised John McCain in 2008, agrees that raising the payroll tax back to where it was could cause another recession.

This convoluted stand by the GOP leadership isn’t so difficult to understand when you look at it from the eyes of Senate minority leader Mitch McConnell who informed the American public last year that “the single most important thing [Republicans] want to achieve is for President Obama to be a one-term president.”  This apparently entails sabotaging anything that improves the economy during this period leading up to the 2012 elections.  Right now the Republicans are focused on distorting the reality that put us in this economic mess in the first place by accusing Obama of failing to have fixed what almost single-handedly their Party screwed up.

The train wreck that turned into the worst economic recession since 1929 was the result of failed GOP policies to regulate non-banking financial markets that allowed wide-spread corruption with home mortgage loans even when they were warned by the FBI back in 2004.  The nation’s top law agency informed Congress then that events within that industry were posing a threat that could exceed the devastation of the Savings & Loan scandal during Ronald Reagan’s presidency.

They have neatly side-stepped their complicity in this while fabricating scenarios that hold Obama and the Democrats fully accountable for everything that has gone wrong since late 2007.  And since winning back the House in 2010 they have done everything they can to undo what Obama has achieved to slow the economic downward spiral while passing legislation that would pretty much reinstate conditions similar to what we had just prior to our economic collapse.  Their biggest fear is that strong signs of economic recovery will develop from the Obama administration’s efforts.  This would destroy the image they have created and ruin their chances to not only win re-election for themselves but to regain control of the Senate and the White House.

The payroll tax is essential to maintain funds needed for the entitlement programs, like Social Security.  Reducing that tax would have removed needed funds to sustain this program but the greater need to provide financial relief for many working Americans had priority with the President and the Democrats.  To compensate for the reduction in contributions, arrangements were made to resupply the Social Security trust fund out of the general fund.  The Social Security trust fund you may recall has been routinely depleted by Congress to pay other federal expenditures then handing the trust fund IOUs in the form of government treasury bonds, giving this secure fund a bad image as a drain on the federal debt.

Naturally drawing money out of the general fund negatively impacted the federal deficit, that bugaboo that the chicken littles on the right ignored during the Bush years but now think is critical to our very survival.  The Tea Party contingent that took over the GOP last year threatened to shut down the government if spending cuts weren’t initiated to prevent what they foolishly thought would increase the deficit by raising the debt ceiling.  Obama has addressed the concern with raising the deficit however by requesting that the lost revenue that will occur if we extend the payroll tax cut be taken from those who live way beyond normal means now – the 3.5% surtax on income amounts in excess of $1 million.

To gall of Republicans who seek to eliminate hundreds of dollars from workers paychecks annually while killing a great opportunity to create more jobs is shocking.  To them it is more important that millionaires not suffer the small hit on their taxes from income over $1 million.  The vast number of American working families must continue to struggle so the wealthiest amongst us can continue their lavish life styles simply  because one Party has signed over their good judgment to the threats of one man’s campaign to shrink government small enough to drown in a bath tub – Grover Norquist

Could it be any clearer where the hearts and minds of the GOP rest?  When called to sacrifice for the improvement of our overall economy, Republicans are clearly on the side of that small segment who have vastly profited during this economic crisis as they were bailed out of their own failures on our dime.

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“From tax write-offs for gambling losses, vacation homes, and luxury yachts to subsidies for their ranches and estates, the government is subsidizing the lifestyles of the rich and famous. Multi-millionaires are even receiving government checks for not working. This welfare for the well-off – costing billions of dollars a year – is being paid for with the taxes of the less fortunate, many who are working two jobs just to make ends meet, and IOUs to be paid off by future generations.”

It might come as shock to those on the right who read this that these are not the ramblings of an anti-Capitalist, left-leaning Democrat.  They come from a report recently released from the office of ultra-conservative Oklahoma Senator Tom Coburn.  Coburn states in his report entitled Subsidies of the Rich and Famous, that as “families across the country [are] struggling to make ends meet during these economically trying times, many are left with few options so they are turning to the government – some very reluctantly – for assistance.”  Some may recall that it was Coburn who single handedly blocked the efforts of the full Senate in 2010 to extend unemployment benefits to the millions of people who had lost their jobs as a result of the financial collapse of the free-market.

Coburn is also part of the Republican bloc in the Senate where minority leader Mitch McConnell has stated that the “single most important thing we want to achieve is for President Obama to be a one-term president.”  Thus, every effort where the Obama administration has attempted to alleviate the plight of “families across the country struggling to make ends meet”,  has been blocked by Senator Coburn and the rest of the GOP.

Coburn’s report is not testament to any shift in political views regarding government aid.  He still lamely claims that taxing the rich because they “are getting too much of the economic pie …  is no different than taking a dollar from one pocket and putting it into another in the same pair of pants.”  That would only be true if the wearer of those pants was also a millionaire.  Entitlement programs and aid grants that provide a safety net for the poor and unemployed during tough economic times is hardly money that goes to people who really don’t need it.

But unlike many of his Republican/Tea party colleagues, Coburn appears to have seen the writing on the wall from the ever growing and popular Occupy Wall Street movement that has brought home the reality of the vast income disparity between the wealthy 1% in this country and everyone else.

His report is a worthy attempt to show that “welfare for the well-off – costing billions of dollars a year – is being paid for with the taxes of the less fortunate, many who are working two jobs just to make ends meet, and IOUs to be paid off by future generations.”  His report aptly demonstrates that billions have been going to millionaires over the last decade for things like tax write offs in the form of farm subsidies to people who neither actively work or even live on a farm to some 60,000 wealthy individuals who have filed for Medicare Part B with modified adjusted gross incomes of $1,000,000 or more.

He also makes a great case for means testing of all entitlement programs like Social Security, Medicare/Medicaid and Unemployment benefits.  In 2009 over 38,000 people with adjusted gross incomes of $1 million or more, collected $1,142,204,000 in Social Security benefits, an annual average of $30,780 for each recipient.  Though that’s a wapping amount for most income earners it is only about 3% of those who made $1 million each year and about 0.30% for those who made over $10 million.

Granted, even some millionaires paid into the social security trust fund during their lifetime as wage earners.  But with high unemployment rates today where there are fewer workers available to contribute their share through payroll taxes and the aging baby boom generation starting to retire, the strain on the trust fund has created a deficit in receipts for the first time in nearly 30 years.  The system is capable of paying 100% of benefits until 2036 but if we don’t make necessary adjustment it will only be able to pay 75% of benefits after that.  Means testing would reduce the payout to millionaires and even eliminate benefits for some, providing needed revenue for those wage earners who depend on Social Security benefits as their sole source of retirement funds.  “Returning the purpose of the program to a need-based service instead of one available universally may help keep Social Security solvent for future generations”, says Coburn

Medicare/Medicaid is in even worst shape than Social Security because of the increase in high health care cost and fraud abuses by health care providers.  For millionaires to apply for this entitlement program when their resources allows them buy some of the best health care coverage that the private sector offers is ludicrous.  According to Forbes reporter Janet Novack last month,  a “couple on Medicare with a $428,000 AGI will benefit from a 13 percent decrease in their Part B premium payments.  At the same time, the majority of Medicare Part B participants who pay the lowest premiums will see their monthly premiums increase slightly, offsetting the first cost-of-living-adjustment (COLA) increase recipients have seen in about 3 years.”

To deplete these vital resources for low income and handicapped individuals in order to prevent a millionaire’s resources from diminishing is ludicrous.  How many of these very wealthy people have referred to Medicaid/Medicare as a “socialist” program that is depleting tax payers of their hard-earned wages?

Fraud is apparently rampant within the Unemployment Insurance (UI) Program too.  This entitlement program that also receives contributions from wage earners through their payroll taxes as well as employer contributions, serves to alleviate the loss of wages when workers have been laid off for reasons other than poor performance.   Without these benefits many families would be strapped to pay for food and rent until they can find other work.  Yet Coburn’s report showed there were those collecting unemployment benefits who were “also earning millions of dollars in the same year.  In 2009, the Internal Revenue Service reported that 2,362 millionaires collected a total of $20,799,000 in UI. Eighteen individuals reporting an adjusted gross income of $10,000,000 or more also received $12,333 on average in UI in 2009, for a total of $222,000.”

Angela Wade, who has also reported on this at her Blue States blog  has broken the benefits down cited in Coburn’s study to show just how much revenue is being lost for essential social programs to people who are far from being in need.

  • $18.15 million in child care tax credits
  • $74 million in unemployment checks
  • $89 million for preservation of ranches and estates
  • $316 million in farm subsidies
  • $608 million in business entertainment deductions
  • $9 billion in retirement checks
  • $21 billion in gambling losses
  • $28 billion in mortgage breaks for mansions, vacation homes and yachts

Though it is encouraging to see Senator Coburn present such a detailed outline of the waste of needed government revenue going to people within the top 2% of income earners in this country, it will be interesting to see if this just a head jerk to feign concern about the need to correct such abuses that occur through federal subsidies and policies that neglect to prevent unethical practices by those in the top tier income groups.

His conservative creds are still locked into the notion that “government policies intended to mainstream wealth redistribution are undermining these principles”  that expects “everyone to contribute and to demonstrate personal responsibility”.    Yet the expectations one sees coming from this study suggests that Coburn is not in the same camp with other Republicans who see the removal of existing tax subsidies as onerous “tax cuts”.

Coburn has boasted that this study is the first comprehensive effort that has revealed how nearly $30 billion in giveaways and tax breaks has fleeced the American taxpayer.  We can only now hope that he will step up to the plate and vigorously defend this data and convince his fellow Republicans to step away from their pro-corporate entrenched view of supporting the haves to the detriment of the have-nots in our country. Or will we see him wilt in the face of the strong opposition from the right-wing extremists who have taken over the Grand Old Party of Lincoln?


Paul Krugman makes a striking observation that has sat beneath my radar about the U.S. Defense department’s budget all this time.  I used to scream and holler about the bloated defense spending in this country (still do in fact) on destructive forces along with many items that served no real need for our modern military.

An example of the latter is Lockheed Martin/Boeing’s F-22 Raptor jet that no one in the Pentagon really wants, but many in Congress do to appease Lockheed Martin/Boeing, or in mixed company with his or her voting constituency an elected official would refer to it as “important job creation “.  With the full support of the GOP back in 2009 the Democratic-led House Armed Services Committee stripped $369 million for environmental cleanup – a job creator – to find enough money in the fiscal 2010 budget to fund an additional 12 F-22s.

But these are tough economic times and as Krugman matter-of-factly notes:

Military spending does create jobs when the economy is depressed. Indeed, much of the evidence that Keynesian economics works comes from tracking the effects of past military buildups. Some liberals dislike this conclusion, but economics isn’t a morality play: spending on things you don’t like is still spending, and more spending would create more jobs. SOURCE 

With all the hollering and hammering by TeaParty-GOPers about how government can’t create jobs along with the equally baseless claim that tax cuts for millionaires is a job creator, we discover that they are really just hypocrites when it applies to defense spending.

The super-committee that was formed by Congress shortly after the fiasco about raising the debt ceiling was resolved this last summer (albeit temporarily) but now has to come up with some other, more permanent cuts next month that the full committee agrees on or there will be automatic cuts across the board.  Not just in the areas that many conservatives and Libertarians are salivating over like Social Security and Medicare, but also in areas that they do not want to see, specifically cuts in the DoD’s budget.

Many of them  are unabashedly opposed to cuts in Defense because they say it will kill jobs.  Think about that for a minute.  The anti-government crowd is affirming that the federal contracts with many private businesses, which are paid with tax payers dollars, not only established new jobs at one time, they sustain them as long as the Defense budget is kept pumped with public funds.  Those in Congress who support such federal spending are pretty much the same ones opposed to Obama’s Job plan that seeks to stimulate job growth through infra-structure repairs and on energy efficient projects like high-speed rail, wind and solar innovation and retro-fitting government buildings and fleets to run off of renewable, cheaper energy sources.

We need jobs bad and we need them now but conservatives in Congress can’t own up to the reality that, as Krugman puts it, “spending on things you don’t like is still spending.”   The business acumen that affirms “you have to spend money to make money” seems totally lost on those who want to eliminate spending on needed programs simply because they’re not ideologically sound in the Tea Party-Libertarian view of things.  Infrastructure spending is spread out and not necessarily dominated by a national or even international corporate interests; that power element within the top 1% that tends to pull the strings of many in Congress and even dictate how to write legislation benefitting these wealthy interests.

Spending on infrastructure repairs has a multiplier affect too, creating jobs that benefit more businesses.  Repairing bridges and roads better enables those vehicles who transport the parts for the unwanted F-22 Raptor jets while it also generates jobs that feed the truckers and repairs their vehicles.  As these businesses expand there is a greater need for other retail services that accompany the influx of new workers.

The same occurs when you replace older manufacturing jobs with newer ones in the fields of renewable energy.  Developing countries like China and India are beginning to dominate this 21st century opportunity, leaving the U.S. to catch up.  We need to make stronger advances to make sure that the U.S. is competitive in this new growth field.

 

The finite sources of fossil fuels is not lost on these two expanding economies and they are fully aware that to sustain their growth they are going to need vast quantities of easily attainable and cheaper sources of energy along with the huge amounts of coal and oil they are already drawing from the global supply of limited resources.

Social welfare spending on things like Medicare/Medicaid, Unemployment benefits and Food Stamps are not entities that can stuff campaign coffers with big bucks but they do have a healthy impact on the economy, despite the reservations of anti-government types.  Sustaining such programs does have negative consequences for the deficit when unemployment rates climb and tax revenue is removed but the money spent on such programs goes directly back into the economy and keeps some businesses from going under in tough recession conditions like those we are currently experiencing.  In a healthy economy where there are high rates of employment and a livable wage, the need and thus the burden for such programs diminishes.  Our current deficit issue is more a factor of the Bush tax cuts and two foreign wars.

There was a time when traditional political conservatives felt the need to keep Defense spending at a reasonable level.  Eisenhower’s warning about the threat from the military-industrial complex pretty much fell on deaf ears but back in 1989 then Defense Secretary Dick Cheney sought to cut $10 billion from the Pentagon’s budget

Cheney termed the proposed cuts “very, very painful” but said that there is no way to balance the budget “without offending somebody, without breaking some china, without stepping on some toes.”

Cheney’s budget–$305 billion for the 1990 fiscal year, which begins Oct. 1–contains a 1% reduction after inflation from the current year’s spending plan. It marks the fifth consecutive year of real declines in defense spending, which has fallen 12% short of keeping pace with inflation since 1985.

But the $10 billion in reductions for 1990 represents only a down payment on a total of $64 billion that Cheney must pare from Reagan’s military spending goals over the next five years to meet the Bush Administration’s deficit-reduction targets.   SOURCE

The issue of job creation by defense spending is apparent even today as one can attest to with the projected military spending for this month alone.   I cringe at the thought of this reality but under such dire economic circumstances I am willing to forego my ideological bent to see Americans back on the job and off of the welfare rolls.   TeaPublicans need to do the same and reciprocate by allowing the needed spending requested in Obama’s Job’s Plan.

The deficit matters but not half as much as job creation does right now and those on the Right need to swallow this tough pill and do what’s needed for ALL Americans.  That means we need to raise taxes on the wealthiest 1% to spend on these essential job-creating programs and as the job market grows include the remaining 99% in fair proportion to their income.

To seek spending cuts in areas that hurts most Americans while ignoring them in others as efforts are also made to further reduce needed revenue through tax cuts is a short-sighted and callous approach to job creation – not to mention the hypocrisy of those who refuse to see how spending by the government is in fact a job creator

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A great piece in the NY Times by David Carr yesterday illustrated what’s wrong with Wall Street as those who covet it’s appeal to riches continue to criticize the OccupyWall Street movement outside their windows.

Almost two weeks ago, USA Today put its finger on why the Occupy Wall Street protests continued to gain traction.

“The bonus system has gone beyond a means of rewarding talent and is now Wall Street’s primary business,” the newspaper editorial stated, adding: “Institutions take huge gambles because the short-term returns are a rationale for their rich payouts. But even when the consequences of their risky behavior come back to haunt them, they still pay huge bonuses.”  SOURCE

This insight of USA Today had personal relativeness.  Just a week before this editorial came out in this Gannett-owned paper, it was revealed that Craig A. Dubow resigned as Gannett’s chief executive after just six short years.  His reward following his retirement?  A package deal of “just under $37.1 million in retirement, health and disability benefits. That comes on top of a combined $16 million in salary and bonuses in the last two years”, Carr tells us.

And what was it you may ask that Mr. Dubow did to earn his golden parachute?  He “strip-mined” the newspapers of Gannett, cutting 20,000 jobs from 82 newspapers giving readers very little in boots on the ground reporting; the kind of in-depth reporting that reveals scandals and abuses which often impact those communities.

To rub salt into the wound, a Gannett board member, Marjorie Magner, praised Mr. Dubow for championing “our consumers and their ever-changing needs for news and information.”  What news would that be Ms. Magner?  Useful pieces that tell women what it is that men really want or visa versa?  How about where to shop for the best winter boots to meet your wardrobe needs?  This kind of content is being written by serious but struggling free-lance writers who contribute their work to sites like Associated Content and Helium for $10-$15 an article

Mr. Dubow did essentially what benefitted stock holders and investors.  He squeezed the life out working families who relied on Gannett for their income and passed those “savings” on to the portfolios of people like Marjorie Magner

David Carr’s story reveals that this is not a stand-alone incident.

The Tribune Company, a chain of newspapers and television stations run into the ground by Sam Zell after he bought it in 2007, is paying out tens of millions of dollars in bonuses as part of a deal in which it would exit bankruptcy.

Over 4,000 people in the company lost their jobs, and the journalistic missions of formerly robust newspapers it operates — including The Los Angeles Times, The Chicago Tribune and The Baltimore Sun — have been curtailed. And even though Randy Michaels and some of his corporate fraternity brothers who operated the company into bankruptcy are gone, more than 600 managers who were there while the company cratered remain.

Not only do they have jobs while so many others were sent packing, but the remaining leadership will be eligible for a bonus pool from $26.4 million to $32.4 million under the current plan.

This is but one glaring example of why people who criticize the OWS movement are either blind to the insensitive nature of many people within those for-profit industries or they are on the inside looking out, cursing and accusing us, like Herman Cain, of   ”playing the victim card” or as someone who wants to “take somebody else’s” Cadillac.

There is no focus within OWS on taking anything away from anyone.  It simply wants corporate board members like Marjorie Manger and CEO’s like Craig Dubow to understand that their kind of non-productive, greedy behavior is self-serving while it takes away from their neighbors and those employees, current and layed-off, who put their lives into their jobs.

We want a level playing field and that begins in part by addressing the abuses on Wall Street that created the economic collapse in late 2007.  But as Professor of Cognitive Science and Linguistics, Georg Lakoff points out, “OWS concerns go well beyond financial issues”.

Democracy starts with citizens caring about one another and acting responsibly on that sense of care, taking responsibility both for oneself and for one’s family, community, country, people in general, and the planet. The role of government is to protect and empower all citizens equally via The Public: public infrastructure, laws and enforcement, health, education, scientific research, protection, public lands, transportation, resources, art and culture, trade policies, safety nets, and on and on. Nobody makes it on their own. If you got wealthy, you depended on The Public, and you have a responsibility to contribute significantly to The Public so that others can benefit in the future. Moreover, the wealthy depend on those who work, and who deserve a fair return for their contribution to our national life. Corporations exist to make life better for most people. Their reason for existing is as public as it is private.   SOURCE

Capitalism has nothing to fear from those in Zucotti Park in lower Manhatten or the multitude of support OWS protests that have popped up over night in nearly every major urban area and many smaller towns across this country and in other parts of the world.  All any of us are trying to do is shine a light on the abuses that continue to occur within corporate America that is dragging our once great way of life down to economic despair for the 99%.

Markets are not the sole domain of the wealthy investors, CEOs and corporate board members.  They are not there to be manipulated for the benefit of a few.  They serve us all and when the benefits of our efforts are fairly distributed, we all gain and capitalism lives another day.  Otherwise, if it remains this closed system that the Marjorie Magners and Craig Dubows control, then it plants the seeds for its own destruction.


I Support Occupy Wall Street

 

It’s a terrible thing when an individual loses his or her grip on reality. But it’s much worse when the same thing happens to a whole political party, one that already has the power to block anything the president proposes — and which may soon control the whole government.  - Paul Krugman

The recent actions by TeaParty-led Republicans in the U.S. House and Senate to quash  the President’s job plan sends a clear signal that their primary goal of making Obama a one-term president is still on target.  It also displays a mental exclusiveness that rejects arguments that don’t support purest laissez-faire market principles.  Republicans opposed this plan because its includes more spending to stimulate the economy and puts a tax surcharge on millionaires and billionaires.  This intransigent view that such action will hurt a recovery rather than help it is one that is not even supported by many conservatives in business and economics.

It is a belief however that some self-serving people want to keep alive for personal reasons.  For fear that small tax increases on millionaires and billionaires will become popular with the lower 95% (I hesitate to use the currently popular figure of 99% because the top 5% includes many millionaires) wealthy people are desperate to create the pie-in-the sky delusion that such a thing can happen to all Americans.   The likelihood however that any significant number of us will ever join their elite club is a myth that stems back to the early Horatio Alger stories of the 19th century.  Mary Sanchez speaks admirably to this in a recent column of hers at the Kansas City Star upon reflection of Cain’s insulting comments about the OWS protesters:

Herman Cain just doesn’t get it.  His allegiance to the Horatio Alger myth makes him far too dismissive of real world problems facing recent college graduates.

Cain demonstrated how out of touch he is when asked his opinion about the Occupy Wall Street demonstrations now gripping New York and other cities around the country. Many of the protesters are young people from middle-class backgrounds and with college educations. 

“If you don’t have a job and you are not rich, blame yourself,” he chided, adding a finger-wagging explanation that his parents didn’t raise him to look enviously at those with more wealth.

The classic Alger virtues — determination, focus and work ethic — worked for Cain (age 65) and fellow candidate Mitt Romney (age 64) when they were young in a world where America’s expanding economy was dominant. Young people today are no less entrepreneurial or driven than previous generations. The problem is that times have changed, and the Republican candidates might want to take note.  

“We can all have one of these, right?”

It’s a bogus notion to believe that all government spending will fail to create jobs because it allegedly “robs” the rich of money they would otherwise invest to create jobs.  Here’s some factual information and data that lays this notion to rest:

  • Following Herbert Hoover’s top tax rate increase from to 25 to 63 percent in 1932, the new President, Franklin Roosevelt, “begins spending at the same time that the new tax hike comes into effect. The Depression bottoms out.  Recovery begins. The GNP rises 7.7 percent, unemployment falls to 21.7 percent.  Further tax increases and spending occur through 1936 as GNP continues to grow while unemployment drops even further. – SOURCE
  • The claim by those on the right that lower taxes mean higher revenue is a “voodoo proposition” according to Pulitzer prize-winning economist Paul Krugman: “A more sober assessment from the nonpartisan Congressional Budget Office tells a different story. It finds that a large part of the supposed savings from spending cuts would go, not to reduce the deficit, but to pay for tax cuts. In fact, the budget office finds that over the next decade the plan would lead to bigger deficits and more debt than current law.” – SOURCE
  • The record of the Bush tax cuts is undeniable: their enactment coincided with the weakest economic expansion of the post-war period, blowing up the national deficit and debt, while not bringing any of the promised gains. – SOURCE
  • Rich People’s Taxes Have Little to Do with Job Creation.  “In the past 60 years, job growth has actually been greater in years when the top income tax rate was much higher than it is now.  If you ranked each year since 1950 by overall job growth, the top five years would all boast marginal tax rates at 70 percent or higher. The top 10 years would share marginal tax rates at 50 percent or higher. The two worst years, on the other hand, were 2008 and 2009, when the top marginal tax rate was 35 percent.” – SOURCE
  • Even Billionaire Warren Buffet warns the GOP to “Stop Coddling the Super-Rich – SOURCE
  • “Business investment, while recovering, remains historically low. Corporations are not directing their rebounding profits to productivity-enhancing activities, instead holding cash or spending the money on buying back their own shares and paying out dividends to shareholders.” – SOURCE
  • The temporary tax [cuts and] incentives to support business investment and hiring in the House stimulus plan do not provide a particularly large economic benefit. Accelerated depreciation by large businesses and expensing of investment by small businesses lowers the cost of capital only modestly and is not a critical factor in businesses’ investment decisions, particularly when sales and pricing are so weak. The carry-back of business losses helps cash-strapped businesses, perhaps forestalling some cuts in investment and jobs, but it is unlikely to prompt much additional business expansion as it does not improve businesses’ prospects. – SOURCE 

And about spending and its effects on the economy

  • Cutbacks to public services and public investments by state and local governments have proved to be a persistent drain on the overall U.S. economy since the start of the recession, with widespread detrimental results. Unsurprisingly, states making the largest cuts in spending are experiencing the worst outcomes with respect to economic growth, private-sector employment gains, and reductions in state unemployment.  SOURCE
  • Last week brought the disconcerting news that the economy grew no faster than the population during the first six months of the year, in part because of spending cuts by state and local governments. Now the federal government is cutting, too.  “Unemployment will be higher than it would have been otherwise,” Mohamed El-Erian, chief executive of the bond investment firm Pimco, said Sunday on ABC. “Growth will be lower than it would be otherwise. And inequality will be worse than it would be otherwise.”  He added, “We have a very weak economy, so withdrawing more spending at this stage will make it even weaker – SOURCE
  • Job Creation Requires Spending.  Economists Across the Political Spectrum Get It   SOURCE
  • Government Spending Can Create Jobs—and It Has.  The lessons are clear when our economy Is in trouble. There is an empirically grounded body of literature documenting the effectiveness of fiscal expansion during recessions and the importance of economic multipliers in creating jobs above and beyond those directly created by one firm or one government project. – SOURCE 

During primitive times there were beliefs held by people who took the word of the authority figures in their tribe, either the chief or some medicine man or soothsayer.  Much of what was concocted was derived from their interpretation of events which was severely limited by any real in-depth knowledge of what makes the world go round.  Yet it helped them explain their world for the time being and piece of mind was more important to them until things happened later to give them cause to doubt.

This was invariably going to happen so when the sacrifice of the virgin didn’t appease the volcano gods, the chief or medicine man would attribute this failure to the virgin herself or because there was not enough faith amongst the tribe to satisfy the gods.  Rather than employ any critical thinking on the matter and make necessary corrections, the tendency was to defend the absurd notion that allowed the problems to continue while always finding other dubious acts to explain why their original inclination didn’t pan out as expected.

This is the type of behavior we see in play with the TeaParty-Republicans today.  Their adamant ideological belief in the principles of free markets and the inerrant word of Milton Friedman and Ayn Rand inhibits them from seeing the warts that are inherent under close scrutiny.  Even in the face of overwhelming evidence there is still denial amongst such zealots that anything that “free-marketers” did had a causal effect on our economy that went south back in 2008.

Paul Krugman points out this delusional behavior in his recent column.

Suddenly, you find yourself in a fantasy world where nothing looks or behaves the way it does in real life.  And since economic policy has to deal with the world we live in, not the fantasy world of the G.O.P.’s imagination, the prospect that one of these people may well be our next president is, frankly, terrifying.

In the real world, recent events were a devastating refutation of the free-market orthodoxy that has ruled American politics these past three decades. Above all, the long crusade against financial regulation, the successful effort to unravel the prudential rules established after the Great Depression on the grounds that they were unnecessary, ended up demonstrating — at immense cost to the nation — that those rules were necessary, after all.

But down the rabbit hole, none of that happened. We didn’t find ourselves in a crisis because of runaway private lenders like Countrywide Financial. We didn’t find ourselves in a crisis because Wall Street pretended that slicing, dicing and rearranging bad loans could somehow create AAA assets — and private rating agencies played along. We didn’t find ourselves in a crisis because “shadow banks” like Lehman Brothers exploited gaps in financial regulation to create bank-type threats to the financial system without being subject to bank-type limits on risk-taking.

No, in the universe of the Republican Party we found ourselves in a crisis because Representative Barney Frank forced helpless bankers to lend money to the undeserving poor.

Talk to a free-market ideologue though and all you’ll get are bumper sticker responses that always include the word “socialist” in it.  The fact that some government spending and tax increases are really necessary under certain economic conditions is rejected by them and their likely response regarding failures of the free market is apt to be that the virgin was really a closet whore.  Today’s GOP leaders are nothing more than ideological cowboys keeping their herd contained for as long as they can, hoping that a bolt of reality-based lightning won’t strike and send them stampeding.

And God said, “Let there be critical thinking.”

RELATED ARTICLE:

The Seven Biggest Economic Lies (Robert Reich, HuffPost)


In its most current acting out as zombies, the Republicans in the U.S. Senate voted unanimously to kill President Obama’s Job Plan.  They were joined by two conservative Democrats – Ben Nelson of Nebraska and John Tester of Montana.  Both Democrats are up for re-election next year in states that are not politically favorable to the President.  With nothing but the ideological view that government spending and tax increases for billionaires will hurt an economy, the failure to notice that the lack of spending by anyone and the top wealthiest 1% have seen massive increases in their income, begs the question, “How did these people get put into a position of leadership”?

On the heels of this Senate vote was an NBC/WSJ poll that showed a majority of people polled were in favor of Obama’s job plan.

Even though the United States Senate on Tuesday blocked President Obama’s jobs bill, the legislation’s specifics — as well as the idea of taxing the wealthy to pay for it — are popular with the American public, according to a new NBC News/Wall Street Journal poll.

When asked simply if Congress should pass the legislation or not, 30 percent of respondents answer yes, while 22 percent say no; 44 percent have no opinion.

But when the legislation’s details are included in a follow-up question — that it would cut payroll taxes, fund new road construction, extend unemployment benefits, and that it would be paid for by increasing taxes on the wealthy — 63 percent say they favor the bill and 32 percent oppose it.

What’s more, 64 percent of respondents agree with the statement that it is a “good idea” to raise taxes on the wealthy and corporations, because they should pay their fair share and can afford to pay more to help fund programs and government operations.  SOURCE

We are in a fight here for our national way of life.  The failure of leadership in the Congress and some lapses in the White House all too often come across as appeasing special corporate interests rather than what’s essentially needed to turn things around.  In a detailed analysis that attempts to answer the questions “why have the policies attempted thus far fallen so far short … and what should we be doing instead?”, Daniel Alpert of Westwood Capital, Robert Hockett, Professor of Law, Cornell University and the ever renowned Nouriel Roubini, Professor of Economics, New York University, have stated the obvious in their report, The Way Forward 

Our economic straits are rendered all the more dire, … by political dysfunction and attendant paralysis in both the United States and Europe.  The political stalemate is in part structural, but also is attributable in significant large measure to the nature of the present economic crisis itself, which has stood much familiar economic orthodoxy of the past 30 years on its head.  For despite the standoff over raising the U.S. debt ceiling this past August, the principal problem in the United States has not been government inaction.  It has been inadequate action, proceeding on inadequate understanding of what ails us. 

The “inadequate understanding” stems from a belief by the anti-government, Libertarian view in government these days that we can’t spend our way out of this recession and that raising taxes on richest 2% percent will deprive the economy of money needed for investments.  These are age-old talking points of the right that have been debunked over and over by business leaders and numerous economists including Ronald Reagan’s former budget director David Stockman, who told ABC’s Christiane Amanpour last November and in a previous 60 Minutes segment that “the Bush tax cuts must be allowed to expire — not just the ones on the wealthiest earners, but on everyone”.  Stockman argued that raising taxes is ordinarily a “bad thing to do,” but the US “is in such dire shape that we have no choice but to accept the negative trade-off of some harm to the economy to start paying our bills.”


This last point of Stockman’s about the legitimacy of raising taxes when the economy “is in such dire shape” was addressed in the aforementioned report, The Way Forward.

Regrettably, in our view, there seems to be a pronounced tendency on the part of most policymakers worldwide to view the current situation as, substantially, no more than an extreme business cyclical decline. From such declines, of course, robust cyclical recoveries can reasonably be anticipated to follow in relatively short order, as previous excesses are worked off and supply and demand find their way back into balance. And such expectations, in turn, tend to be viewed as justifying merely modest policy measures.

But despite the dearth of information available to those in Washington and many state legislatures along with the numerous polls that show Americans support government programs like Social Security, Medicare/Medicaid and Unemployment Benefits while raising taxes on at least the wealthiest amongst us, the GOP and blue dog Democrats continue to turn a deaf ear to most of their constituents.  The only constituency that isn’t suffering under their efforts are the wealthiest 2%.  Yet billionaires like Warren Buffett and Starbuck’s Howard Shultz have complained that the GOP has been coddling their class too long and concur with the polls that say some tax increases on the highest brackets make sense.

What will it take to get these intransigent politicians to break their tight bonds with Wall Street?  Will it take an Arab Spring-style uprising that is beginning to evolve with the Occupy Wall Street movement?

NY Times columnist Joe Nocera, who has read Alpert, Hockett and Roubini’s report, The way Forward, thinks this lays out a cogent plan and can be a good start for the partisan divide in congress to find common ground with.

I don’t know that anything at this point could re-center the political debate, so unyielding are the two parties. But as Congress prepares to take steps, through the deliberations of the already deadlocked supercommittee, that will likely further wound our ailing economy, “The Way Forward” ought to at least give our politicians pause.

The report lays out a 3 pillar solution:

First, a substantial five-to-seven year public investment program that repairs the nation’s crumbling public infrastructure and, in so doing, (a) puts people back to work and (b) lays the foundation for a more efficient and cost-effective national economy.

Second, a debt restructuring program that is truly national in scope, addressing the (intimately related) banking and real estate sectors in particular – by far the most hard-hit by the recent bubble and bust and hence by far the heaviest drags on recovery now

And finally, global reforms that can begin the process of restoring balance to the world economy and can facilitate the process of debt de-levering in Europe and the United States.

But none of this can begin until reasonable are willing to look past their own political lives and ideological morass and work towards a solution that puts ALL Americans first, not just that vocal laissez-faire minority who are propped up financially by wealthy self-interests.  If they don’t we can only hope that the American voter will correct what occurred in 2010 and pray that this action is not too late.

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RIP, American Jobs Act (George Zornick, The nation)

Americans’ playing field tilts toward wealthy

I Support OccupyWallStreet


One of Obama’s points in his speech Thursday was that he would be asking Congress to cut more on the payroll tax from what was cut already in the compromise agreement between him and the GOP last December.  These cuts could actually hurt more Americans than they are intended to help.

The Republicans are in full gear to diminish and alter one of the most successful entitlement programs this country has had – Social Security.  Medicare too has been tremendously successful but unlike Social Security it suffers cost issues from abuses by providers while also paying for many questionable services that patients feel encouraged to utilize.  The last thing our President needs to be doing is opening a path that will assist the Republican/Tea Party in achieving the means to kill off these vital programs.

Both programs, as does unemployment benefits, depend upon payroll contributions deducted from our earnings each paycheck to sustain them.  The formula for social security deductions has kept the program solvent almost its entire life.  Last year was the first time since 1983 when the program paid out more than it took in.  This is the result of less revenue from payroll taxes due to high unemployment rates, more baby boomers becoming of age and those laid off older workers who find it easier to claim early retirement at age 62 than hassle with the younger generation vying for jobs.

It has been argued that Social Security benefits are a drag on the deficit.  That’s a distortion and is only true in the sense that congress keeps “borrowing” from that trust fund to pay some of the other bills they have to.  When they borrow money for Social Security it is covered by the “full faith and credit” of the Untied Sates government and invested in special Treasury bonds.  But this borrowing from the $2.5 trillion that social security is valued at is now considered part of the U.S. debt.

The $49 billion shortfall we are now experiencing in social security revenue can be corrected by generating added revenue that will have the least impact, if any, on most all working Americans.  Those who protest tax increases of any sort are often people who are less likely to be affected by them.  For instance, if we simply boosted the amount of earnings subject to the payroll tax over time we could cover this shortage in plenty of time before the 2036 date that says if we do nothing, current benefits will reduce to a 75% payout amount.

Currently income over $106,800 is not taxed to help pay for social security as well as the other payroll taxes for Medicare and unemployment benefits.  This means that increasing this amount will have no affect on 95% of income earners in this country.  Also, income from investments – income that the wealthiest among us receive most of their income from – are not subject to the FICA taxes which social security is part of.  By making these sources of revenue subject to taxation, social security would become solvent for at least the next 75 years, long after the baby-boom generation no longer creates a strain on the trust fund benefits.

So if added revenue will correct what needs to be addressed with recent Social Security shortfalls, why is Obama talking about reducing the existing source of revenue that traditionally has fed the system?  Back in December when the President was trying to appease the Tea Party segment of the GOP to raise the debt ceiling he tossed them a bone in the form a of tax cut.  That tax cut amounted to about a 2% reduction of the 6.2% rate currently established as the amount that we pay on payroll taxes.  It was intended to put a little extra spending money in the pockets of American worker but it also “blew a hole in the financing mechanism for Social Security by reducing payroll tax revenue by roughly $110 billion for the year.”

Sorry Peter but I need to pay Paul

With the enactment of “The American Jobs Act”  the FICA tax holiday for workers will be increased to a 50% reduction, lowering it to 3.1%.   Along with this “the President proposes to extend the FICA tax holiday to employers by cutting in half the employer’s share of the payroll tax through the first $5 million in payroll.”

Under the payroll tax cut initiated in the 2010 lame duck tax deal, the revenue loss to the Trust Fund from the payroll tax holiday is made up through compensatory payments into the Trust Fund from general revenues. The President proposes to continue this scheme — deepening a relationship between Social Security and general revenues (read deficit) that did not exist until the December 2010 tax deal.  This will make Social Security increasingly vulnerable to demands for “reform.”

In the worst case, Congress could choose to enact the payroll tax cut without actually appropriating revenue compensation for the Trust Fund.  This would mean that the payroll tax cut directly depletes the Trust Fund, creating financial/actuarial problems far sooner than the currently anticipated shortfall date of 2036. - SOURCE 

He couldn’t be handing Grover Norquist and all the other anti-government people a sweeter gift than transforming the way Social Security pays for itself to one that would actually make it a drain on general tax revenue.  Thus it could be  more legitimately argued by the those who want to privatize the system that the nation is spending more than it takes in and Social Security is part of the problem.

I don’t want to accuse Obama of working with those people who drool over the prospect of getting all that tax revenue that pays into the trust fund so they can make a profit off of it while diminishing the benefits.   But if it isn’t clear to him that this tactic, intended to stimulate the economy, is really a slippery slope that allows free-market proponents to shrink the Social Security trust fund to a size “that can be drowned in a bath tub”, killing it off completely, then he either hasn’t got the foresight many of us have given him credit for or he is taking sides with those who want to reduce the deficit on the back of the least powerful and most vulnerable in this country.

I can appreciate the fact that by allowing more people to take more of their paycheck home will convert into more spending that can help jump-start the economy.  But let’s be realistic.  Nearly one-fourth of the nation’s wealth is controlled by only 1% of its people while slightly more than half of working American  households make less than $50,000 a year.  More than half of those, 28%, make less than $25,000.  For this latter group that means they get to keep about $65 a month more if the payroll tax is cut to 3.1% as suggested in Obama’s Jobs Act.  With the high cost of essentials like gas, food and rent, $65 dollars will likely not make much of an impact on growing the economy.

But this further reduction of the payroll tax will begin to eat away at entitlement programs that benefit many of the low-income earning families that assist them with health care costs that they would otherwise not have available to them.  There is also the concern too that lower payroll taxes that help provide unemployment benefits will be further strained to alleviate financial distress when people get laid off due to a failing economy.

Many young working people today may not empathize as much with this concern as someone who has worked all their life and is now ready to retire.  For those who were lucky enough to tuck away money into a retirement fund, the benefits they are owed from the social security trust fund may only be a small part of their income revenue to sustain them.  But they are in the minority.  According to the Center on Budget and Policy Priorities close to 90 percent of people 65 and older get at least some of their family income from Social Security. Social The venerable trust fund now provides most of the income for more than half of the elderly and for many, it is the only income they have.

For children of those elders reaching retirement age who are watching their own shrinking budgets, I can tell you from experience that had it not been for Social Security benefits my mother and father would not have remained as independent as they were nor received the medical care they needed.  Our family, like most Americans are not among that class of people who have sufficient wealth to cover their own needs and then some.  We struggle with our own families to get by and if we had to incur the rising expense required to take care of our aging parents it would put a further strain on already strapped resources.  This would feed the cycle of a worsening income disparity taking place in this country today because saving for your children’s college education and your own retirement would have to be put on hold to do what you need to do for those who raised you.

The further cut in payroll taxes may be appealing to many hard working families in these tough economic times but it can become a catch-22 problem that will only make our lives more miserable down the road as the safety nets that keep millions of Americans from falling into the despair of poverty and ill-health are eaten away by a move that lowers the resources needed to keep them intact.

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It has been a long tough slog but corporations have finally cajoled their way into the concept of personhood.  If only they were really flesh and blood people they would understand that there are things more important than money.

Since the founding of this country there have been battles fought in the courts that have, bit by bit, stretched the principles of the Constitution to a point that ultimately sought to achieve a human status for the creations of mankind, that which has historically belonged solely to the human race.   It is the “unalienable right” asserted in the Declaration of Independence as being the self-evident possession of humankind “endowed by their Creator”.  Can a corporation that answers primarily to investors and a CEO of the corporeal realm take on the characteristics of those whose source of faith is alleged to be a higher supernatural power be seen as an equal?

Following the recent decision of the conservative-heavy Roberts’ court in the Citizens United vs. FEC, words alone that emanate from the diaphragm as it pushes air from human lungs through the vocal folds in our larynx is no longer viewed as the only form of “speech” to which the Constitution applies.  By some immense stretch of the imagination, this controversial Supreme Court decision has declared that M-O-N-E-Y has now become a legitimate mode of speech,  which corporations have vast sums of compared to most real people.  This action ignores the conflicting reality that some of the humans who make up a corporation are now somehow separate from their individual human status by legal fiat and can have essentially two voices that the rest of us do not.

 

The legal whizzes that not only argued this case for corporations but who on the court accepted it, use a form of linguistics uncommon to most of us.  I won’t venture into a debate over the legalese that only a select few engage in.  I haven’t the time or inclination to argue the merits of this lunacy with people who have only their own self-interests at heart.  What I do want to discuss though is the perception that came out of this that corporate citizen are on a level playing field with the rest of us.

I attended a recent city council meeting in my hometown of Denton, Texas that was specifically arranged to address the issue of extending the current ordinances in place for drilling natural gas wells within the corporate city limits as well as any “Extraterritorial Jurisdiction” (ETJ), stated in the information the city provided for those individuals interested in attending these hearings.  Denton, and the county it’s in, set atop the northeast sector of the Barnett Shale in Texas.

The special city council meeting was for the sole purpose of gathering human citizen input on how best to proceed to extend existing city ordinances that govern the exploration, development, and production of natural gas wells.  An all volunteer 3-member panel Citizen Task Force had been selected to gather this information and present it and their recommendations to the City Council

Denton gas well task force members below from left to right areTom LaPoint, Vicki Oppenheimer and John Siegmund 

The meeting, one of several to be held over the next few months, took place at Denton’s Civic Center, including members of the city council who were present only as a formality in that location to accommodate an anticipated large crowd that the council chambers couldn’t.  It seems this was’t necessary after all.  There were roughly 50-60 people there including some media and representatives from the natural gas industry.  By in large though, it was mostly citizen activist who were there to voice their concern on how natural gas wells should or should not be allowed to exist in close proximity to their homes, their school, churches and parks.

It was a good mix of people, from the two college students who represented the generation that would deal longer with the effects of gas wells in this community to long time residents who were now contending with the odors and environmental impacts of gas well noises and toxic waste water open pits.  In total, 19 people came before the committee to convey their concerns and opinions.

 Citizen Joyce Pool has dealt with

 the problems of gas well noise and

open waste water pits for over a decade

Real Estate agent Phyllis Wolper brought attention to diminished land values that occur when gas well are drilled next to homes and other commercial developments

After most of the local citizens had their say, Gilbert Horton, a representative of Devon Energy, “one of the world’s leading independent oil and gas producers” and Martin E. Garza, a Dallas attorney who specializes in real estate and land use/zoning issues who has been representing natural gas interests since 2001, gave their assessments to the task force.  These two men and one citizen named Ben Claybore conveyed the industry’e viewpoints, essentially expressing their concern that creating too many hindrances for gas drilling interests would deprive the industry of their constitutional rights and could have negative “economic consequences” for the area.

   

Devon Energy Representative Gilbert Hooten and Dallas Lawyer Martin Garza

Horton said there is a “growing body of fact-based research” that supports the safety of hydraulic fracturing (also known as fracing) and prompted task force members to consider this above “the emotional comments” many who had come before him had made.  Garza reminded the task force members that there are state and federal guidelines that may conflict with adaptations to the city’s ordinance and that prudent measures utilizing cost-benefit analysis should also be weighed before imposing new regulations.

Clearly these are legitimate arguments that ultimately the city council will have to consider as they eventually review the task force’s considerations based on such hearings.  But the degree to which they should be considered in light of not only the equally legitimate concerns many voiced that evening about the ill-effects of drilling and the fracing method used to extract the product is a topic of concern that poses a challenge to the rights of men and women versus the newly proclaimed rights of corporate citizens.

  

Do human citizens’ concerns about the negative impact of fracing and the use of local water supplies out weigh a need to provide jobs for some and enlarge the city’s tax base?  Those who convey and support corporate interests always take the tact that the corporate citizen is a partner in the community since they do provide jobs and pay taxes.  But unlike flesh and blood citizens they ultimately owe their loyalty to outsiders that make up stock holders and executives at corporate headquarters in another state or even another country.  Some of these headquarters are deliberately located in countries that serve as tax havens for businesses who seek to keep more of their capital for stock holders and bonuses for top executives.  That’s what businesses are primarily expected to do; make profits and expand their wealth and sphere of influence.

Their contributions to the community in the form of financial grants to education and other vital social services is indeed a welcome benefit to these entities but it also serves as PR to community leaders that can be influential in giving an unfair advantage to their voice over those citizens whose separate financial contributions are a legal obligation that come in the form of mandated property and sales taxes.  Except for the very wealthy philanthropist, most human citizens are unable to give above and beyond what their taxes cover for consideration in the eyes of those who “make the rules”.

Neither can individual common people entice political leaders with appeals to their selfish nature in the form of generous campaign contributions and positions of status and generous incomes in the businesses sector once they leave the public domain.  Large corporations also have deep pockets to create legal challenges to public-conscious politicians that the average citizens doesn’t.  Such litigious challenges are intended to wear down battle-fatigued public officials to abandon the fight if victory is not soon apparent.

For the most part, only those individual citizens who share a common interest and join together as a single entity have the capabilities to fight on a level playing field with the corporate citizen; but only to the degree they sustain a cohesive front of the multiple individual self-interests of members who are willing to tough the fight out over the long haul and provide financial resources to match those of their corporate counter part. Such endeavors that have been successful and have played their cards appropriately have forced the corporate citizen to weigh the cost-benefit measures of doing battle with such public grass-root efforts, forcing them to concede to the organized ban of citizens.

 Not all citizens are the same. 

Say hello to a corporate neighbor

But where this public opposition fails to crystallize as a large body, the corporate citizen is usually the victor.  And even then there is less hope for such grass-roots organizations if local politicians have already developed favorable relationships with the corporate entities. Thus the lone individuals or even a very small group find it difficult to fight a monolith that combines corporate and political interests.  On a true level playing field each “citizen” should be able to protect their life, liberty and property against the wants and desires of the corporate citizen.  They often lack the wherewithal to fight the notion that claims corporations serve economic benefits that outweigh the quality of life for individuals.

If our neighbor is engaging in activity that threatens our health and means of production the courts are quick to act in favor of those people who will be impacted by such practices.  But if that neighbor is a corporate citizen then there is a different standard that seems to apply.  Asking the corporate citizen to cease and desist those practices that threaten our quality of life gets special consideration because what they are doing creates jobs and tax revenue, benefitting more than just themselves.

This is a sound argument until you add the elements of costs to individuals in the short and long terms that impact their health care costs and other out-of-pocket expenses they incur to offset the damage done by the corporate citizen, not to mention the toll on a human’s quality of life.  In the case of gas drilling, the fracing process injects known toxicants into our drinking water supplies and allows deadly chemicals to escape into the air we breathe.  The process destroys the land on and around it for decades making future development of any kind unlikely, lowering the value of homeowners in the area.  The serenity of neighborhoods are diminished and even removed as the noise from production takes away from the neighborhood that which was once a major appeal to homeowners – the tranquil sounds of nature and children playing in that natural setting.

We need the businesses that free markets create and their needs to be limits and guidelines by which they can peacefully coexist with the real people they find themselves among.  Most small businesses fit in perfectly with this scenario as they become  assimilated into the local human matrix and are genuinely welcomed.  But when the mammoth scale of corporations intrude and try to pass themselves off as “one of us”, they do so with only the intent to make a profit where they can and then move on to the next locale to manifest their business model.

The people who work at these large corporations are routinely the locals themselves.  That in itself is sufficient to have someone represent the company in terms of local appeal.   But when top management that headquarters and lives outside that community as well as their investors, they shouldn’t be allowed to double their representation in the form an individual defined in our founding documents as those who possess unalienable rights “endowed by their Creator”, unless everyone is willing to redefine “Creator” in such documents as commercial, for-profit entrepreneurs.



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