Archive for the ‘The Economy’ Category

A lot of conservatives/Trump voters are confused as to why Liberals are saying that the tax bill Congress passed today will be bad for entitlement programs like Social Security and Medicare.  Below is a brief explanation as to why, but first let’s stop calling them “entitlements” because they aren’t.  It’s not like welfare, which you are “entitled to” if you meet certain criteria and into which you don’t have to contribute.  Call Social Security “deferred payments” or a “pension”.  For that matter call Medicare “pre-payed health insurance”.  But they’re not entitlements because you paid into them!  Okay, got that off my chest.

Social Security has always been a “partially reserved” fund.  In other words, like many pension funds, it was never “fully funded” 100%.  Simply put, every penny we have put in isn’t there for a lot of very complicated reasons I won’t get into here (see Note 1).  For the most part how much the fund contains at any given point depends on how well the economy has been doing and each generation pretty much pays for the next generation.  That’s why we hear stories like “Social Security only funded until 2034”.  That year could be later if the economy has a good run or it could come sooner if we have another recession/depression.  Medicare works similarly.

Since the health of those two “deferred payment” programs depends on the economy and the Deficit (see Note 2 at bottom) is one of the leading indicators and factors that affects the health of the economy, any increase in the Deficit forces the US to borrow more, which in turn increases our Debt.  The Tax Bill passed today (see Note 3) will decrease Revenue and Congress has not offset that decrease in Revenue by reducing how much we spend.  So the GOP, who used to accuse the Democratic party as being “Tax and Spend Liberals” has now officially become the party of “Taxes for Thee but not for Me and My Wealthy Friends”–a tried and true method to destroying any economy.

In the past one of the most important ways the GOP has tried to bring the deficit down is to make changes to Social Security and Medicare.  They can try to push back the age at which we can start receiving Social Security–this is called “full retirement age” (see Note 4).    The GOP will say they can save millions by just pushing back that age for you and I and it is true, it will save money.  But it will make our lives infinitely harder.  Maybe I won’t be able to continue working when I’m 67.  Last I heard they are talking about pushing it back to 70.  My grandparents died at 75. What if I pass away then?  That means I’ve been working since I was 14 and contributing to Social Security all those years and if I’m lucky I might get 5 years of benefits out of it.  That’s nuts and patently unfair.

Not only can they do that, they can change the formula for how much you can receive if you remain employed.  For now, if you try to get Social Security early, you can only collect a certain amount.  For example in 2015  your benefits would have been temporarily reduced by $1 for every $2 you earned above $15,720.   This “earning limit” gets changed every year.   So the GOP could say that your benefit is reduced by $1.50 for every $2 or say that the earning limit doesn’t increase (and therefore won’t help you keep up with Cost of Living Increases).

In regards to Medicare, they could start “means-testing” (again this is a GOP proposal that’s been around for a while).  This would mean the government would check to see how much you make and say that anyone making above a certain level must pay a greater percentage of Medicare costs.  On the surface this sounds fair.  But the fairness of it depends on what that “income level” is determined to be.  For example, the 2015 poverty threshold for a single individual was $12,082 / year.  Can you imagine living on that?  If you make more than that, the government doesn’t consider you poor.  The same principle will be applied to Medicare means-testing.  The GOP will push for a very low “means” and the already struggling Middle Class will be hit very hard.  If the Middle Class is dependent upon Social Security for retirement (and we have a good idea that they are, see Note 5 ) and the GOP plans on reducing those benefits along with Medicare benefits, then there is going to be a lot of elderly people really struggling.  In fact, an elderly care crisis has already begun.  The timing of this deficit increase, in order to give the wealthy more tax breaks, could not have been worse for the average American.

To sum it up, there are lots of ways that the GOP can affect these two programs that will hurt not only the Poor but the Middle Class, and they’ve been making noises for years that they can’t wait to get their grubby hands on them (Speaker Ryan has said he’s been dreaming of cutting them since college). By passing this tax bill they have essentially created a budgetary crisis for which they will now claim is the reason why they have to change the rules for these two programs. Anyone who voted for Trump and is happy about this Tax Bill better enjoy the pennies they get back in April because they’re not going to be happy further down the road when they have to resort to eating cat food.  Unfortunately it won’t be just Trump voters who will be eating kitty kibble–we all will.

NOTES:

  1. http://www.pewresearch.org/fact-tank/2015/08/18/5-facts-about-social-security/  Just Google history of social security and you can drown in the details if you so desire
  2. Do NOT conflate Debt and Deficit.  They are NOT the same thing.  In simple terms, a budget deficit is the difference between what the federal government spends (called outlays) and what it takes in (called revenue or receipts). The national debt, also known as the public debt, is the result of the federal government borrowing money to cover years and years of budget deficits.
  3. “The plan would permanently drop the corporate tax from 35 percent to 21 percent, while also rewriting the individual tax rules to lower rates and restructure deductions. The plan would cut taxes in 2018 for the vast majority of households, with by far the largest benefits going to the wealthy. Many of the tax breaks are set to expire at the end of 2025, leaving a large section of the middle class to pay more in taxes. But Republicans promise a future Congress will intervene to prevent that tax hike from happening.”  from the https://www.washingtonpost.com/business/economy/gop-tax-bill-passes-congress-as-trump-prepares-to-sign-it-into-law/2017/12/20/0ba2fd98-e597-11e7-9ec2-518810e7d44d_story.html?utm_term=.7cfa59492113
  4. I was born in 1970 so right now that means I can’t start collecting until I’m 67 years old.    Follow the link to find out what your full retirement age is.   https://www.thebalance.com/when-can-i-start-receiving-social-security-benefits-2894602
  5. https://www.forbes.com/sites/patrickwwatson/2017/10/12/boomers-are-not-saving-enough-for-retirement-neither-is-the-government/#5624b5d81a4d
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My two cents on the political stories floating around each week.

  • Today Louis C.K., one of my favorite comedians, admitted to sexually harassing several women.
    –TAKEAWAY: Goshdangit, I just can’t even with this….
  • Former DNC Interim Chairwoman Donna Brazile has slightly modified her criticism of the 2016 primary and the DNC (‘it wasn’t rigged but it had cancer’) doesn’t matter now because her book has sold out on Amazon.
    –TAKEAWAY: She’s all about the Benjamins. Who wants to bet she ends up on Fox News as one of their token “liberal” pundits? 
  • While Congressional GOP members are dropping accused pedophile Roy Moore like hot potato, fellow Alabama GOP members think it’s not a problem.
    –TAKEAWAY: Alabama GOP thinks that ANY Democractic candidate is worse than a pedophile.
  • Enrollment on Healthcare.gov is surprisingly robust with new enrollment up 30%.
    –TAKEAWAY: Trump and his lackeys are so incompetent they aren’t even able to sabotage Obamacare effectively. 
  • Ret. General and Former NSA to Trump Michael Flynn is publicly worrying about the fate of his son regards the Russian Collusion investigation by Mueller.
    –TAKEAWAY: The pressure is getting to Flynn and he will flip soon, if he hasn’t already.
  • Trump has had his lips glued to the Chinese Leader’s ass for the last couple of days in complete opposition to his own positions on trade with China since forever and trade agreements like the TPP are moving forward without the US.
    –TAKEAWAY: If anyone doubted that the US has lost it’s preeminence on the world stage, this proves it conclusively. The world will now be led by China and Russia. 
  • Trump’s top economic adviser Gary Cohn admitted in an interview that the current tax bill in Congress is based on “trickle down” economic theory–ya know, the kind that doesn’t exist and the GOP is openly admitting that their wealthy donors will stop donating if they don’t pass this tax bill.
    –TAKEAWAY: The GOP cares more about giving money to the wealthy than it does the actual welfare of the US economy.
  • Trump’s bodyguard for the past several decades said that Trump was offerred Russian escorts when he traveled there.
    –TAKEAWAY: Does anyone believe that Trump turned down EVERY Russian offer of escorts? The Pee Tape is real. 
  • GOP Congresscritters were getting really frustrated with Carter Page’s testimony before Congress because he was incapable of giving a yes or no answer, or really any answer that made any sense whatsoever.
    –TAKEAWAY: The guy that the Russians thought was too stupid to be turned and used was, in fact, that stupid and useless.

Sources:
HT http://www.bobcesca.com/
HT https://www.balloon-juice.com/
https://www.nytimes.com/interactive/2017/11/07/us/politics/document-carter-page-russia-investigation-transcript.html
https://www.theatlantic.com/politics/archive/2017/11/carter-page-international-man-of-mystery/545159/
https://www.nbcnews.com/news/us-news/trump-bodyguard-testifies-russian-offered-trump-women-was-turned-down-n819386
https://www.cnbc.com/2017/11/09/gary-cohn-trickle-down-is-good-for-the-economy.html
https://www.huffingtonpost.com/entry/gary-cohn-tax-cut-ceos-donors_us_5a049571e4b0f76b05c4249e
http://www.newsweek.com/brazile-clinton-steal-2016-election-sanders-706766
http://www.msnbc.com/morning-joe/watch/donna-brazile-dnc-not-rigged-but-there-was-a-cancer-1091141187992
https://www.washingtonpost.com/investigations/woman-says-roy-moore-initiated-sexual-encounter-when-she-was-14-he-was-32/2017/11/09/1f495878-c293-11e7-afe9-4f60b5a6c4a0_story.html
https://twitter.com/ddale8/status/928756267425943553
https://twitter.com/Dpugel/status/928673017143676928
http://www.cnn.com/2017/11/08/politics/michael-flynn-son-special-counsel-russia-investigation/index.html
https://www.forbes.com/sites/alexcapri/2017/05/22/the-tpp-moves-forward-without-trumps-america/
https://www.nytimes.com/2017/11/10/arts/television/louis-ck-statement.html

St. Andrew's Cross, The Scottish Flag

St. Andrew’s Cross, The Scottish Flag

First, I know Scotland is having the big VOTE for independence today and I want to wish them luck.  I know a lot of respected economists are saying it isn’t a good idea BUT my heart says I hope they vote Yes and they can work out the details later.  I seriously doubt that England will shoot itself in the foot by refusing to let them continue to use the British pound for their currency.  If they do, it will be colossally stupid and destabilizing for both countries.  My opinion is definitely colored by my Irish heritage.   Even though Scotland has a longer history of being part of the U.K. than Ireland, it doesn’t change the fact that it originally occurred as a matter of conquest.  I only wish that a united Ireland could do the same.

Second, I’m so very tired of hearing the constant negative press against the President.  It’s like the American media isn’t in touch with reality any more.  They’re just so dead set on being against the Administration (Faux News, I’m looking at you) or they’ve wed themselves to the idea of appearing centrist (even NPR drank the kool aid on this nonsense) that they won’t report what’s really going on.   Here’s what they’re not telling Americans.

Pesky facts about how President Obama has actually improved things in the U.S.

Pesky facts about how President Obama has actually improved things in the U.S.

Do you see the difference in Deficit % of GDP, that’s frigging huge!  And that’s not disputable….it’s a fact.  But try to tell a conservative that the president has reduced the deficit and they will have a hissy fit.  It doesn’t fit into their narrative so it couldn’t possibly be true.  Ht to @BlueNationUnited for the graphic

Game of Thrones last episode, “First of His Name”, not only reached record levels of cable subscriber viewers surpassing even The Sopranos but it is also setting records for illegal downloads [ht for both links to WinterIsComing.net].  Well, I’m not crying any crocodile tears for cable providers because THIS  is how I feel about them:

I moved a couple of weeks ago. In my old house I had a bundled package through CenturyLink (formerly Qwest) for DSL internet (60Mbps download) and DirectTV for HBO (and a thousand other useless stations). We didn’t actually get 60, but we sure as hell paid for it. And their service dropped all the time. At the new house the max download speed that CenturyLink could offer was 5Mbps–this is in a newer neighborhood, built after fiber optic was being installed automatically. Forget about the kids using their Xbox while you watch a movie via Netflix…that ain’t gonna happen….hell I couldn’t work from home using that kind of download speed!

So we had to get rid of CenturyLink, which means we had to get rid of DirectTV–remember it’s a bundle–separate the things are impossibly expensive. Now DirectTv wants over $300 as a penalty for canceling with them which we wouldn’t have had to do if CenturyLink didn’t suck so much. DirectTV said ‘well you can keep us and use Cox for your Internet‘.    No, I can’t because it will cost me 3x’s as much per month if I go that route. I can’t afford over $300 a month–that truly is insane. To put it into perspective, that’s more than I pay for health insurance every month!!!

The ONLY other option for Internet connection at the new house (or anywhere else in central AZ for that matter) was Cox Communications–who has the absolute worst customer support I have ever had the misfortune to encounter in all my years of consumer spending (I used to have them when I lived in the Central Phoenix corridor). There was no other choice, so I signed up with Cox.

In order to get near the same speed I am now paying slightly more per month than before AND they forced us to get a phone line and sign a 2 year deal. I haven’t had a plug in phone in years and I still don’t. I refuse to put a phone in so telemarketers can bug me 24/7. Screw em. So now I’m paying for phone I don’t need AND a thousand channels I don’t watch so I can access the Internet and watch HBO.  In a year or so if I need to move again, what if the house to which I’m moving doesn’t have access to Cox Cable.  I was thinking about buying a house.  Do I have to restrict my house search to only ones that allow Cox Cable?  The whole thing is just absurd.

Why are these companies allowed to control every point of access we have to streaming content? They don’t allow monopolies in other industries but this one seems to be A-Okay with Congress. It boggles the mind.

The following news stories actually make me not only wonder if our species will survive for much longer but also if we deserve to survive our own stupidity and neglect.

  • The City of Detroit found 11,000 rape kits that were abandoned and never tested.  After testing less than 7% of them they identified 100 serial rapists and 10 convicted rapists.  So if that pattern holds and they test the rest of them, they can expect to discover several hundred more of these scumbag.  ht mistermix at Balloon Juice
  • The AZ legislature is pushing a bill that would allow people to carry guns into building even if it’s forbidden (if they don’t have lockers available you can ignore the ban).  They’ve also advanced the idea that some gun owners can carry even if there are lockers and ban.  And to make it truly impossible for local governments to forbid guns in their government buildings, they’ve approved and forwarded a bill that says any local government who enforces local ordinance over state law can be fined.  This is like the trifecta of stupid.  They’re begging for someone to go into government buildings and commit mass murder.  I certainly will be avoiding those buildings like the plague if this crap passes.  ht JM Ashby at Bob Cesca
  • New Jersey Governor Chris Christie, back when he was a prosecutor, let a child slaver off easy so that he could take down a political rival.
  • Pat Robertson, TV Evangelist, told a woman that having cancer was her own fault for not forgiving her abusive father.  Okaaaaaaaaaaayyyyyyy
  • A new law went into effect in Michigan that says businesses and individuals who purchase private insurance must take out a separate rider to cover abortion care.  Essentially, if a woman needs an abortion for ANY reason and if she doesn’t have  a separate rider for it, she will have to pay out of pocket for the cost of that care.  So if I lived there, had a miscarriage and needed a D&C to shorten the process  and suffering so I could get back on my feet sooner, I would have to pay completely out of pocket for it.  Likewise for women who have become pregnant as a result of incest and rape.  That’s insane.  The real kicker is that there is not a single private insurance provider in the marketplace that provides this insurance.  This could not only bankrupt women and their families, it in effect nullifies Roe v. Wade, and will force women to seek out cheaper and more dangerous care for such things.  I hope the women in Michigan enjoy being second class citizens because it looks like the state is on target to vote the same politicians who’ve created these laws back into office.
  • Billionaires in the 1% are getting their panties in a twist and crying lots of salty tears because the rest of us are tired of having the economy manipulated while they gamble with our money and take what little wealth Americans have managed to accumulate over the last few decades.  The 99% have had the temerity to exercise their Freedom of Speech and the Right to Vote in more progressive candidates.  However, so far as I know there have been no lynch mobs or guillotine lines nor any proposed by anyone of significance in any “likely to happen” fashion.  The 99% are simply using the peaceful system of governance and the wonderful mechanisms given to us by the Founding Fathers.  However, reading some of the recent comments by the 1% (here’s a few examples here and here) might make one think that we are in the midst of a communist peasant uprising (or fascist style takeover depending on which historical example they erroneously choose).  Truth is, if we were in such a state, their heads would already be on pikes.  In reality nothing is happening to them and that’s the stupid thing.  We should be curtailing their almost godlike power over our economy and our elected officials. Their message gets broadcast loud and clear.  We hear about their perspective 24/7 on Fox News, read their whining on major websites and news sources (in addition to reading about their phenomenally ignorant take on history), and suffer under the vagaries of the worldwide economy which they essentially control.  As Jon Stewart said the other day, they make money regardless of how the economy fares.  So why should they give a crap about us? They don’t and the majority of Americans haven’t yet grasped this fact and what it will mean for this country, and indeed the world, in the long run.  Until Americans decide to stand up and pull up our pants, they’ll be back there having their way with us and complaining that its hard, nay dangerous, to be a billionaire.

Jon Stewart on The Daily Show sometimes gets on my nerves with his “both sides do it” tendencies, but in a recent segment absolutely decimates Eric Bolling and Fox News coverage of food stamp fraud.  Video here:  http://www.hulu.com/watch/608697

For those “over the pond” folks who cannot access the video, here’s a summary.

Jon shows Eric Bolling calling him out.  Tape of Bolling saying he is going to take Jon “to school”.  After making fun of Bolling for this ridiculous call out, Stewart walks through their hypocrisy step by step.  He points out that one hippy (who was used as THE example of food stamp fraud on 6 different Fox shows) does not represent the millions of poor Americans.  But okay, we don’t have to argue that point.  Let’s address how much fraud there actually is.  So he show that food stamp fraud is about $3 billion annually and is not anything to sneeze at.  Jon then compares that to the amount of money not paid by corporations due to loopholes in the U.S. taxes every year, which amounts to about $4 billion a year.  Then he shows a clip of Bolling saying that the money lost due to unpaid corporate taxes of “$4 billion is a pittance, a pittance!” in the larger scheme of things.  So $3 billion lost in our effort to feed poor Americans is too much but losing $4 billion to corporations every year is a pittance.  Hmmmmm……

Stewart then asks why do they, meaning Fox and conservatives, think this?  He shows clips of them talking about corporations being “job creators”.  He then shreds this next point like a master.  JP Morgan was instrumental in causing the recent Great Recession that affected the entire world.  They sold sub-prime mortgages and derivatives as triple A investments and the bottom fell out.  They created a whole lot of poor people. Did you know that JP Morgan Chase also administers the food stamp EBT program for 24 states making hundreds of billions a year on that contract alone?  Did you know they get paid per customer?

Jon then supposes that JP Morgan must put that money back into our economy by creating jobs…that’s what conservatives and Fox News claim.  Turns out that is not the case.   To handle the customer support calls on the food stamps program, JP Morgan hired offshore operators who get paid $3.50 an hour.  That’s right–the job creators are creating jobs alright, just not in the frigging U.S.    So no matter what happens, corporations win if the rest of lose and they always make sure we lose.  After all, it’s in their best interest, which is making a profit.

Stewart sarcastically explains this business model for us:

“But don’t think of it as JP Morgan shorting homeowners.  Think of them as going long on hunger.”

He follows that massive wallop with another as he ends the segment.  He says:

So what I’m getting from Fox is this….Exploiting government largess while reprehensible and morally corrupting for an individual is a-okay for corporations.  

Then there appears a picture behind Stewart of a little girl and carton of milk and he says:

So, maybe this will help.  Don’t think about food stamps and head start and programs like that as feeding and helping a small child.

As the milk carton disappears from the picture, Stewart finishes with:

Think about it as investing in promising start-up with a liquidity problem.  

It was an absolutely brilliant takedown.

We few, we happy few, we band of brothers; For he to-day that sheds his blood with me
Shall be my brother;
–William Shakespeare, from Henry V

In my mind, the part that says “sheds his blood with me” should be “sheds his blood for me”. See in modern warfare everyone doesn’t fight in wars–at least not in the U.S. We have the luxury of having standing armies. But that doesn’t relieve us as fellow citizens of our obligations to those who do fight. Apparently U.S. Senate Republicans have forgotten that.

Senate Republicans voted down a VA spending bill.  Only Democratic Senators and two Republicans voted for the bill. The opposed Republicans argued that 1) it’s borrowed money and that’s bad policy, 2) the VA is wasteful so why extend its mission if it’s already failing, and 3) they wanted new sanctions against Iran tagged onto the bill because they couldn’t get it to the floor for debate any other way.

There’s so much there to lambaste….where to start. I’ll try to keep it simple.

1) Borrowed Money BS: The GOP has the nerve to bitch about borrowed money when they supported TWO wars and borrowed money to fund them. Hell they didn’t even budget for them until Pres. Obama came into office and insisted that we put the expense on the books and start paying for them. You, know, to do the grown up thing. Both wars cost us $4 trillion with tens of billions wasted and ended up lining the pockets of big corporations like Halliburton and Xe. You know Halliburton the company that Dick Cheney used to run and Xe, formerly known as Blackwater, who provided soldiers for hire when we ran out of troops.

So now these same guys are now refusing to pass a bill that would take care of the very veterans that fought in those wars because it would cost us $21 billion over 10 years. Now realize this new bill restores pension money that was previously promised to veterans and upon which many military familes were planning on having upon retirement. Congress only recently took a part of their pension away–so they could give it back–they never should have taken it in the first place. The bill also sought to expand benefits like caretaker stipends. You know for all those soldiers so wounded from IED’s that they need constant care while their beleaguered spouses have to now work just to survive. Did you know that the military spent $103 million on food stamps in 2013, which was a 5% increase from the year before, and that the usage of food stamps by military families has quadrupled since 2006? That’s because base pay for a soldier with a wife and one kid is $20,000. That’s nothing in today’s economy.

2) VA failing in its mission: Sen. Richard Burr (R-NC) actually said “If the VA is already failing to meet its obligations to veterans, is it wise to extend its mission even further?” Oh, do you mean like we were losing in Iraq and extended what we were told would be a “get in, get out” kind of thing? Like when Pres. Bush declared mission accomplished but the war actually lasted 10 frigging years and the country is still experiencing chaos? The hypocrisy is so thick, you could cut it with a knife.

3) Iran sanctions: Do you hear that loud drum beat? That’s the war hawks in the Republican party pounding the drum for war in Syria and/or Iran. They think if they appear to be “strong” then it will make the President look “weak” in comparison. It’s why we’re seeing so many conservative articles online comparing Pres. Obama and Vladimir Putin and praising Putin for his “direct” approach. It’s a two pronged strategy: make him look weak and deny him any peaceful foreign policy solutions. And voila, we’ll have a very profitable war–profitable for them and their ilk but not so much for our military, our national budget, or well for anyone other than the warmongers and the companies that grease their palms. They are so desperate to deny Pres. Obama any political successes that they want to sabotage the already working negotiations with Iran. So they want to sabotage the peaceful solution we are currently engaged in and willing to risk a boots on the ground war with Iran for the sake of getting over politically on the President. Weren’t these the same assholes who demanded that liberals put country first any time we criticized the previous administration? Yes, yes they are.

The problem here is that Americans aren’t paying attention. They aren’t hearing this hypocrisy, at least for the most part. I certainly hope that military families are seeing and hearing the BS coming from the GOP, because if they don’t, these idiots will be voted back into office at the next midterm elections. Wake up America.

Sources:

http://www.brendan-nyhan.com/blog/gop-dissent-attacks.html

http://www.nationalreview.com/article/370782/value-putin-victor-davis-hanson/page/0/1

http://thinkprogress.org/world/2014/02/04/3244781/rohrabacher-mccain-graham/

http://www.cbsnews.com/news/why-soldiers-are-increasingly-relying-on-food-stamps/

http://item.liveleak.com/2/view?i=e4e_1393543001&comments=1

http://www.kcet.org/living/food/food-rant/a-reminder-military-families-use-food-stamps.html

http://www.washingtonpost.com/politics/federal_government/senate-rejects-far-reaching-veterans-affairs-bill/2014/02/27/1d10801c-a001-11e3-b8d8-94577ff66b28_story.html