Monthly Archives: December 2010

Blaming The Economy’s Victims For Economic Crimes

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Blame the unions, blame the unemployed, blame loans to the poor, blame the government… As income and wealth increasingly go to a few at the top public anger is directed at the economy’s victims.
I am in a clinic all day participating in a medical study, so I was talking to one of the nurses. She brought up that California is in real trouble, is going broke, it’s a real mess. She says she doesn’t know what we’re going to do. She has heard that, “lots of states are going bankrupt. There is no money anymore.”
So I asked her what we should do about it.
She said it is because of the unions. “It’s just ridiculous. They want so much.”
I asked if she follows the news closely, she said she does. “I watch the news a lot.”
Some facts: California is famous for leading the country in a wave of anti-government tax-cutting and into Reaganism. We cut taxes an an anti-government ferver and increased prison spending in a law-and-order fever. Then the federal government cut taxes and increased military spending, leading to big deficits. Now we’re out of money to run the state government and the country is getting there, too. California’s problems have little or nothing to do with what state employees are paid, and a lot to do with tax cuts and people across the state not getting paid enough.
Blaming The Unions
This weekend CBS’ 60 Minutes joined the anti-worker chorus, blaming public employee unions for the problems faced by the states. Media Matters, in 60 Minutes’ one-sided, GOP-friendly report on state budgets describes the segment,

In 2,600 words about state deficits, you won’t find the phrase “tax cuts.” Instead, CBS adopts the Republican framing that deficits are all about spending — frequently with loaded phrasing like “gold-plated retirement and health care packages.” And throughout the report, CBS allows Christie, New Jersey’s Republican governor, to launch attacks on unions and make unsupported claims about budget problems, all without ever challenging his assertions and without including substantive disagreement from Christie critics.
… You’d never know from CBS’ report that a big part of the reason that “Christie and his predecessors” failed to make required contributions to the pension fund is that they decided to use the money for tax cuts instead. [emphasis added]

Mike Hall at the AFL-CIO blog explains that New jersey’s workers and pensions are not the problem,

While politicians like Christie rail against the pensions public employees have secured through collective bargaining–painting them as overly generous golden parachutes, McEntee notes the average annual pension for an AFSCME member is $19,000, and the workers contribute 80 percent during their lifetime on the job.

Tax cuts, income and wealth going to a few at the top, but the unions take the blame because they fight for a better life for working people.
Blaming The Unemployed
The unemployed and the checks they get are often blamed for their plight. They are called “lazy,” and it is even suggested the be tested for drugs. CAF graduate David Sirota, in Why the ‘Lazy Jobless’ Myth Persists

The thesis undergirding all the rhetoric was summed up by conservative commentator Ben Stein, who insisted that “the people who have been laid off and cannot find work are generally people with poor work habits and poor personalities.”
[. . .] The trouble, though, is that the whole narrative averts our focus from the job-killing trade, tax-cut and budget policies that are really responsible for destroying the economy. And this narrative, mind you, is not some run-of-the-mill distraction. The myth of the lazy unemployed is what duck-and-cover exercises and backyard nuclear shelters were to a past era–an alluring palliative that manufactures false comfort in the face of unthinkable disaster.

Blaming The Poor And Government
Republicans on the Financial Crisis Inquiry Commission are sabotaging the commission’s work, demanding that “Wall Street” and “deregulation” not appear anywhere in the report. They are refusing to participate, instead releasing a counter-report blaming the government, claiming We, the People forced the giant banks to give home loans to the poor, and blaming the poor for receiving those loans.
What People Think
People tend to think about what is put in front of them to think about. That’s why everyone goes to see a new movie on the first weekend instead of waiting until they can get good seats with no lines. Wall Street and the likes of the Chamber of Commerce understand this so they put scapegoats in front of the public to mask what they are doing. Right now there is a corporate/right campaign to blame working people for the problems they caused.
Like 60 Minutes this weekend, the news sources are run by big corporations, and they have been saying over and over (and over and over) that unions and the unemployed and the poor and the government are the cause of the problems. (When was the last time you saw a union representative on TV, explaining the benefits of joining a union?) And, naturally, after hearing these things over and over (and over and over), viewers like the nurse at the clinic I am in think they should blame the unions, the unemployed, the poor, the government, too.
So much of the income and wealth are concentrating at the top. Taxes have been cut so far. The things our government does for us have been cut back so far. Working people’s wages have been stagnant for so long.
But the blame right now is directed at the unions, the poor, the unemployed and our government: We, the People.
As the AFL-CIO blog concludes,

The long term solution to state and local fiscal challenges … is “a robust economy, one that is creating jobs and replenishing tax revenue.”

To repeat: The long term solution to state and local fiscal challenges … is “a robust economy, one that is creating jobs and replenishing tax revenue.”
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am also a Fellow with CAF.

Where Have Progressives Gone?

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Last night I moderated a “first of its kind” forum in Santa Barbara. It was an interactive, internet T.V. event hosted (for free) by a new company called, “California Streamin'” that brings high definition TV to the internet. (If you’re interested, I’ve included their spiel at the bottom of this post). This is exciting technology that may very well be the great equalizer we’ll need to combat the release of floodgates of big corporate money we’re seeing and will see even more of as time goes by, thanks to right-wing Justice led by John Roberts and Anton Scalia and their outrageous ruling in Citizens United—Although that’s not the point of this discussion, I just can’t stop railing on it for all its anti-democratic implications.
O.K. so, the City of Santa Barbara is known as a very progressive city; we voted for gay marriage, against Prop 8, for a livable wage, early recycling goals, etc. etc. Up until a year ago we had a city council that was 5 Libs and 2 lib-moderates. We’ve had forward-thinking women mayors almost exclusively for the past 25 years….. and I’ve won my elections in the City of Santa Barbara, always proud of my progressive values, by about 65% of the vote every time.
One of our stalwart progressives, City Councilman Das Williams (my protege, successor and very progressive guy) was just elected to the California Assembly. With 11 months left, the City Council is trying to fill his unexpired term. Forty-six people have applied and are being considered for the position. Of that number, I would say thirty are serious candidates (meaning they care, aren’t in this just to promote themselves or don’t think they’re Arnold Schwarzenneger).
It was a very lively and interesting forum where members of the public were invited to sign in and chat while watching the forum live. We took questions from the chat participants, asked many of the questions to the candidate/applicants, (who were all physically present together as if there were a real audience). The candidates responded in real time while folks at home were watching on their computers. We were able to create a very interactive experience for many locals who would rather sit at home and do their politics….maybe with beer in hand (or since this is Santa Barbara, maybe with their favorite Chard or Syrah).
Anyway, the point of this post is that when I asked the 11 applicants for a show of hands describing their politics with the simple question of “How many of you would consider yourselves progressives, moderates or conservatives”, NOT ONE of them identified him/herself as a progressive….NOT ONE! Ten said they were moderates and one said he was conservative. Perhaps a strategic decision, because the board is frozen at three/three at the moment but I can tell you from the answers these panelists gave that at least 70% of them were more progressive than anything else–wanting prevention and intervention over incarceration for our growing youth gang problem; providing treatment and housing for our ever-growing homeless population, etc, etc. Consider, too, that these were people who had sufficiently open minds that they were willing to participate in this unique event.
How far has our brand fallen, where a community that once prided itself in its strenuous opposition to oil drilling, commitment to environmental protection, renters rights, livable wage ordinances, voted for Obama by about 35 points, etc. etc. has scared away proudly progressive politicians????? As I said, many of them WERE progressives, as we define the concept, but not one would own up to it!
While California continues its blue tradition of the past 50 years, things haven’t always—or even that recently been that blue. (We’ve had one Democratic Governor since Jerry Brown was first elected in the 70’s). We’re likely considered the Lefty Capital of the world these days, particularly after this last election, but we are no less vulnerable to right-wing lunacy. I fear that we are looking at the canary in the mine at the moment if this experience is any indication. If long-time proudly progressive Santa Barbara is ducking the progressive mantle, you aren’t going to find it in too many places outside of San Francisco identifying with it.
The bottom line is pretty clear here: we’re in deep trouble if we don’t start to move quickly to rehabilitate our brand—or at least how we present it to the public. The next election isn’t far away….
Those of us who pride ourselves on believing in the common good, the importance of our government as a partner in our collective and individual success and the importance of equal opportunity and dignity for all, we’ve got to get our groove back….and quickly. Let’s start reminding people that progressive values are what has moved our state and nation forward. This is no time to retreat from our proud legacy and vision.

The Storm That Created The “Rust Belt” Is Heading For Silicon Valley

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This fall I was invited to cover the the Keep It Made In America Tour put on by the Alliance for American Manufacturing. I spent a week driving around Michigan, Ohio, Pennsylvania and West Virginia, ejoying the fall colors and visiting small towns all along the way.
I live in Silicon Valley where in spite of the high unemployment — still 10.6% — it’s still pretty nice here, so the extent and especially breadth of the decline of so many cities and towns was a shock. Everywhere you go you see America’s infrastructure crumbling! Of course I know this has been going on, but when you actually come from somewhere that is still pretty nice and see it firsthand – and everywhere – you really see it.
As I drove around these states I saw pretty much the same thing in town after town. As you approach the town on the highway the first thing you encounter is what I will call the vulture circle that surrounds it. This is the circle of Wall Street-owned chains emulating the Wal-Mart model of sucking cash out of the area and sending it away to the wealthy elites who own … almost everything now. These are the national chains that are all the same in every town, all selling the same stuff, all made in China, all putting the local small businesses out of business.
As you drive into town the next thing you encounter is the circle of home equity extraction, with newer houses that have taken on big first and second Wall Street mortgages. These houses mostly look OK — except the foreclosures with the brown lawns and grass growing in the cracks in the driveway. This area has car dealers and strip malls that used to sell expensive cars or nice goods. These dealers and stores feasted on those “take money out of your house” refinancings or second mortgages. Now they have nail and hair salons or are just “for lease.”
As you get closer to the center of town you come to the areas of older houses, more of them boarded up than you want to see, with old, boarded-up stores on a few of the corners of the larger streets. Where there are still-occupied houses they have bars on the windows.
Finally you come to the old, crumbling downtown where there are many empty storefronts, some boarded, the lost dreams of the local small business-owners. Here and there you see, between the vacant lots, a few government buildings.
And then somewhere is what they always call “the old plant.” This is one or more closed-up, fenced-off, rusting old factories or mills. They are fenced off, with lots of broken windows, and maybe part of a building is falling down. This is where the people used to work but the jobs moved to Mexico or China.
Much of the country is like this now. So many of the older small towns, crumbling, the money sucked out by the Wall Street elite. The factories sold off, closed. The people can’t make a living, the towns can’t make a living, the country can’t make a living, the Wall Street elite making a killing.
You can see the process starting here in Silicon Valley, too. As you drive around this area you see that one of every four or five office or light-industrial buildings has an “Available” sign. The region has the same number of manufacturing jobs as it had when the “tech revolution” began. The rest have moved to China. We don’t make cell phones here. We don’t make flat-screen TVs here. We don’t make computers here. We certainly don’t make iPads here — even though Jobs is his name!
Even exclusive Palo Alto has empty storefronts on the main drag. (You know the economy is bad when the rug stores on University Avenue are actually going out of business!) It is even happening here. It will get worse.
In July Intel’s retired CEO and Chairman Andy Grove wrote an important opinion piece,
How to Make an American Job Before It’s Too Late, in which he warned,

Clearly, the great Silicon Valley innovation machine hasn’t been creating many jobs of late — unless you are counting Asia, where American technology companies have been adding jobs like mad for years.
[. . .] As time passed, wages and health-care costs rose in the U.S., and China opened up. American companies discovered they could have their manufacturing and even their engineering done cheaper overseas. When they did so, margins improved. Management was happy, and so were stockholders. Growth continued, even more profitably. But the job machine began sputtering.

Please take the time to read Grove’s entire piece.
The storm that created the rust belt is heading our way, and we need to pay attention. What will it take for American companies to create American jobs rather than jobs outside America?

Can We Really Call This Christmastime In America?

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Have We, the American People, Lost our Heart and Compassion and appear as grave hypocrites at this particular time of year? Or is it just our political “leaders” who have reduced the President to a virtual afterthought in their quest to bankrupt government and give the wealthiest Americans even more? Heavens, the wealthiest among us have a difficult choice to make, as one bold U.S. Senator stated earlier this week. Their dilemma is in which house should they celebrate Christmas. For the unemployed, the question is whether they will have a home at all this Christmas. And yet, the debate goes on about continuing the tax breaks for the wealthiest Americans while those same “leaders” are refusing to agree to continue unemployment payments to those who have virtually nothing
I find myself offended and embarrassed by the rhetoric being espoused by the Republicans in Congress today. They are insisting that we continue billions of dollars of tax-breaks to the wealthiest of Americans at the same time expressing deep concern about the growing deficit, which such tax breaks helped create. Of course, the record is clear that these continued breaks for the wealthy do NOT significantly stimulate the economy. In fact, it is just the opposite. By providing money for those unemployed we are assured that they will put money back into the economy for food, for rent and necessities. They are in no position to SAVE; they will spend it for basic living expenses. The rich, with so much, put that money in the bank and do not spend it. So, there is not even any fiscal logic to their protestations, yet that doesn’t (ever) stop them from making these false claims.
How did we become a nation like this? Or is it, perhaps, just the Republican leadership that is so heartless, so morally bankrupt that they are willing to sacrifice down-on-their-luck Americans, millions of them, in exchange for continued wealth and opulence for a small number of already well-fed and well-heeled supporters.
This is a moral outrage so where is the moral outrage from the Democrats? The President, supposedly the moral leader of this country, is apparently willing to make a deal, a Faustian deal at that, with the heartless politicians who are newly emboldened by their “victory” in November.
And not to be at all blinded by the irony, this is Holiday Season—when we Americans claim to be of good cheer, wishing Peace on Earth and Goodwill to all. Have we, as a nation, become so anesthetized, so paralyzed, so cold-hearted that we are unable or unwilling to DEMAND of our so-called “leaders” that they do the right thing, for once?
If our leaders need to know we have their backs on this issue, then let’s tell them.
Let them know we are a moral, good and decent people and expect them to reflect our values. It’s Christmas-time, dammit. Do something to show you care. Tell them to care, too.

Tax The Rich: A Deficit Plan That Doesn’t Hit We, The People

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Here is MY deficit-reduction plan. This plan does not reflect the views of anyone but myself — and maybe half the population. Unlike deficit plans from the “serious people” in DC, this one doesn’t annihilate the poor and gut Social Security and the middle class while passing even more of the benefits of our society up to a few at the top.
1) Restore pre-Reagan top tax rates. We didn’t have massive deficits until we reduced the top tax rates.
2) Income is income. No more reduced capital gains tax rate. The incentive to invest should be to make a bunch of money from a good investment. The reason there is a low capital gains tax rate is that the wealthy get most of their income from capital gains. And the reason they get most of their income from capital gains is there is a low capital gains rate. The resulting income shifting schemes are a drag on the rest of us. (Also applies to dividends.)
3) Income is income. Inheritance income should be taxed as income, except there should be a “democracy cap” on how much someone can inherit. We decided not to have an aristocracy when we founded this country so we shouldn’t have one.
4) Businesses should be taxed or not taxed, but not taxed AND not taxed. They shouldn’t be able to use “double Irish” or “Dutch sandwich” or operate out of PO boxes in Bermuda or the Cayman Islands. (Bonus, this also helps reduce incentives to send our jobs and factories out of the country.)
5) If you don’t pay your taxes We, the People won’t pay to provide you with services. We can start by not allowing you to have a driveway that connects to public streets, or water/sewer hookups or mail. Also we won’t enforce any contracts for you, including the one that says you “own” your house(s). And no government-developed Internet for you.
If companies like Google want to “double Irish” and “Dutch Sandwich” us or operate out of PO boxes in tax havens, we shouldn’t let them use government services like courts, or the government-developed Internet. See how well they operate without access to roads (that includes for employees to get to go to work.) How about withdrawing the limited liability protection that investors in corporations receive? And of course no protection for “intellectual property” or trademarks. Oh, yeah, no access to anyone who went to a school that used tax dollars. And no government services means no sea-lane protection for your products shipping from Chinese factories, by the way.
6) Speaking of sea-lane protection, why do we have a military budget comparable to when we faced nuclear annihilation by the Soviet empire? Bases in Germany and Japan? And why can I go to this website, pick a DC-area zip code, say 22314, and learn that “Dollar Amount of Defense Contracts Awarded to Contractors in this Zip Code from 2000 to 2009: $7,086,397,848.” Seriously, scroll down the page and look at some of the contracts and amounts awarded. I suspect there’s some serious deficit reduction to be found in the military budget. A comprehensive and very public audit of where all that money has been going since, say, 1981 might take a chunk out of the debt problem all by itself
7) I could start listing all the corporate subsidies, tax breaks, monopoly grants, schemes, contracts, etc. that we pay for, but I think you get the idea. How about calling bribery by its name: bribery, and doing something about it?
8) To the extent that implementing this plan does not clear up the deficit and start paying off the debt, how about a yearly national property tax on all individual holdings above, say, $5 million, with the tax rate progressively increasing as total wealth increases, and keep doing this each year until the debt is paid off. Perhaps start at 1% on $5 million, 2.5% at $10 million, 5% at $50 million, etc. (Hedge fund managers and investment bankers start at 50% and go up, just for the heck of it. We can call this the “get the money from where the money went tax.”)
So there is MY deficit-reduction plan. Or, instead, we could do what the “serious people” deficit-reduction plans do: cut services for We, the People, cut Social Security, cut health care, cut education, cut infrastructure, cut the things that make life better for people, and give all the money to a few at the top. Take your pick.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am also a Fellow with CAF.