kucinich on us economy (plutonomy)

http://www.commondreams.org/view/2011/07/15

Published on Friday, July 15, 2011 by CommonDreams.org

Debt Political Theater Diverts Attention While Americans’ Wealth Is Stolen by Dennis Kucinich

The rancorous debate over the debt belies a fundamental truth of our economy — that it is run for the few at the expense of the many, that our entire government has been turned into a machine which takes the wealth of a mass of Americans and accelerates it into the hands of the few. Let me give you some examples. Take war. War takes the money from the American people and puts it into the hands of arms manufacturers, war profiteers, and private armies. The war in Iraq, based on lies: $3 trillion will be the cost of that war.

The war in Afghanistan; based on a misreading of history; half a trillion dollars in expenses already. The war against Libya will be $1 billion by September. Fifty percent of our discretionary spending goes for the Pentagon. A massive transfer of wealth into thehands of a few while the American people lack sufficient jobs, health care, housing, retirement security.

Our energy policies take the wealth from the American people and put it into the hands of the oil companies. We could be looking at $150 a barrel for oil in the near future. Our environmental policy takes the wealth of the people — clean air, clean water — and puts it in the hands of the polluters. It’s a transfer of wealth, not only from the present but from future generations as our environment is ruined. Insurance companies, what do they do? They take the wealth from the American people in terms of what they charge people for health insurance and they put it into the hands of the few.

We have to realize what this country’s economy has become. Our monetary policy, through the Federal Reserve Act of 1913, privatized the money supply, gathers the wealth, puts it in the hands of the few while the Federal Reserve can create money out of nothing, give it to banks to park at theFed while our small businesses are starving for capital. Mark my words — Wall Street cashes in whether we have a default or not.

And the same type of thinking that created billions in bailouts for Wall Street and more than $1 trillion in giveaways by the Federal Reserve today leaves 26 million Americans either underemployed or unemployed. And nine out of ten Americans over the age of 65 are facing cuts in their Social Security in order to pay for a debt which grew from tax cuts for the rich and for endless wars. There is a massive transfer of wealth from the American people to the hands of a few and it’s going on right now as America’s eyes are misdirected to the political theater of these histrionic debt negotiations, threats to shut down the government, and willingness to make the most Americans pay dearly for debts they did not create. These are symptoms of a government which has lost its way, and they are a challenge to the legitimacy of the two-party system. Dennis Kucinich isUS Congressman from Ohio and a former presidential candidate in the United States. ====

http://www.commondreams.org/view/2011/07/14-15

Published on Thursday, July 14, 2011 by Rolling Stone Greed, Excess and America’s Gaping Class Divide by Matt Taibbi

Courtesy of good friend and Supreme Court of Assholedom justice David Sirota comes this revolting list of Marie Antoinettoid moments from recent years, in an article called “The New ‘Let Them Eat Cake!'”

 

Some of the moments on the list are easily recalled – Berkshire Hathaway gazillionaire Charlie Munger’s famous “suck it up and cope” quote, coming from a guy whose company was heavily invested in bailed-out banks, was an obvious inclusion – but others are quite shocking. For instance, I was completely floored by the New York Times’ pseudo-ironic take on the government’s response to thefinancial crisis, a piece entitled “You Try to Live on $500K in This Town.” This came at a time when President Obama was considering curtailing compensation for bailed-out bankers at $500,000.

The piece was sort of meant to be taken half as a joke, but it is not hard to detect an element of demented earnestness in the fashion section article, an honest argument that with mortgages and private school tuition and co-op fees and taxes, it really was very hard for a certain kind of New Yorker to get by on half a million a year. The proposed salary cap — remember, this cap was only going to be for banks that had fucked up badly enough to need a federal bailout — became the cassus belli for a propaganda war launched from the general direction of Wall Street, where the notion that the government should restrict the salaries of exactly the irresponsible greedheads who caused a global financial crisis was met with blunt outrage. Sirota’s list highlights another bizarre aspect of the$500k story.

During the debate over the proposed cap, one of the things we started to hear from the Antoinette class was a general sense of wonder at the notion that anyone considered them rich. It turns out that a great many of the people who make big six-figure incomes consider themselves middle class. A University of Chicago professor arguing against the repeal of the Bush tax cuts made waves by saying he was “just getting by” with his $250,000 income, while ABC’s Charlie Gibson and CNN reporter Kiran Chetry in recent years suggested that $200-$250,000 is middle class (Chetry’s exact quote was that “in some parts of the country,” $250K “is middle class”).

All of this is a testament to the amazing (and rapidly expanding)*** cultural divide that exists in this country, where the poor and the rich seldom cross paths at all, and the rich, in particular, simply have no concept what being broke and poor really means. It is true that if you make $300,000 in America, you won’t feel likeyou’re so very rich once you get finished paying your taxes, your mortgage, your medical bills and so on. For this reason, a lot of people who make that kind of money believe they are the modern middle class: house in the burbs, a car, a kid in college, a trip to Europe once a year, what’s the big deal? They’d be right, were it not for the relative comparison — for the fact that out there, in that thin little ithsmus between the Upper East Side and Beverly Hills, things are so fucked that public school teachers and garbagemen making $60k with benefits are being targeted with pitchfork-bearing mobs as paragons of greed and excess.

Wealth, in places outside Manhattan, southern California, northern Virginia and a few other locales, is rapidly becoming defined as belonging to anyone who has any form of job security at all. Any kind of retirement plan, or better-than-minimum health coverage, is also increasingly looked at as an upper-class affectation. That the Tea Party and theirRepublican allies in congress have so successfully made government workers with their New Deal benefits out to be the kulak class of modern America says a lot about the unique brand of two-way class blindness we have in this country.

It’s not just that the rich don’t know the poor exist, and genuinely think a half a million a year is “not a lot of money,” as one “compensation consultant” told the New York Times after the crash. It also works the other way — the poor have no idea what real rich people are like. They apparently never see them, which is why the political champions of middle America are at this very minute campaigning in congress to extract more revenue from elderly retirees and broke-ass students while simultaneously fighting to preserve a slew of tax loopholes for the rich, including the carried-interest tax break that allows hedge fund billionaires to pay about half the tax rate of most Americans.

This is also going on because both parties are betraying the desiresof the actual voters, who by and large actually do favor taxing the wealthy (they favor it intellectually anyway, when asked by pollsters). But we don’t see mobs on the street demanding Stevie Cohen and John Paulson and George Soros give up their special 15 percent tax rate, because no actual people have ever seen Stevie Cohen, John Paulson or George Soros in the wild. To most people, the undeserving rich guy is the ex-police lieutenant down the street who’s been collecting a six-figure pension for years after spending two decades writing traffic tickets before retiring at 43.

Seeing that guy lounging in the dugout pool you paid for with your constantly rising property taxes is enough to piss anyone off, which is why it’s not hard to understand where a lot of that Tea Party anger is coming from. But if you want to see a real asshole, you have to somehow get invited to things like the $5 million birthday party of another guy on Sirota’s list, private equity creep StevenSchwarzman. After throwing his elaborate fete for himself, Schwarzman — who is said to make $400 million a year, and made $600 million when his company went public — compared Barack Obama to Hitler for even considering rolling back his carried-interest exemption, which, again, allows him to pay 15% taxes while some of the rest of us pay twice that or more.

“It’s a war,” he said. “It’s like when Hitler invaded Poland.” If you think your local Andy Griffith is a greedy pig because he retired in his forties and built an addition to his garage with your tax money, try hanging out with a guy who eats $400 crabs, throws himself $5 million parties where he is serenaded by Rod Stewart and Patti Labelle (who sang “Happy Birthday”), and then compares the president to Hitler when word leaks out that he might have to pay taxes at the same rate as a firefighter or a kindergarten teacher. But America never gets to meet that guy, because all of those parties are invite-only, and the onlyreporters that go tend to do so with kneepads on — like the extraordinary Andrew Ross Sorkin, who as Sirota notes, predictably wrote a slurpilicious “In Defense of Schwarzman” piece after the event (his thesis, to the extent that I could make it out, seemed to be that there are even bigger assholes than Schwarzman).

As a result, the popular outrage gets steered toward state employees greedily living off their own pensions, not toward the truly deserving targets hiding in the Hamptons and Gstaad and St. Tropez. Anyway, definitely advise checking out David’s piece. You’ll be grinding your teeth by the time you finish. © 2011 Rolling Stone As Rolling Stone’s chief political reporter, Matt Taibbi’s

Published on Monday, July 11, 2011 by The Guardian

UK Manufacturing Deficit Fear: On Holding Economic Journalists to Account Pursuing a plan to kill social security, politicians are relying on a credulous public and compliant media to ramp up debt panic by Dean Baker Theconventional wisdom among the current generation of school reformers is that bad teachers are to blame for the failure of many of our children to learn. Applying this logic to the current debates over the budget and the economy, we should be pointing a big finger of blame at the media. Republican House speaker John Boehner announcing to the media that Congress reached a deal on the federal budget, narrowly averting a government shutdown, in Washington, DC late on Friday evening, 8 April 2011; Boehner has now pulled out of talks about a $4tn deficit reduction deal with the president because it would involve modest tax increases. (Photograph: EPA/Jim Lo Scalzo)

As survey after survey shows, the vast majority of the public are incredibly ignorant of the most basic facts about the budget and the economy. If we treated their teachers in the media the way the educational reformers treat public school teachers, few economics and budget reporters would have jobs. One needs only to pickup a newspaper or turn on the television to get examples of thoroughly awful reporting. When we hear pledges to reduce the projected deficits over the next 12 years by $2tn or $4tn, how many people have any clue how large these reductions – on which the current debt ceiling talks between President Obama and House speaker John Boehner turn – are, relative to projected spending or projected GDP over this period? (The $4tn figure is 8.7% of projected spending and 3.7% of GDP.)

How about that $14.3tn figure for the debt ceiling? That’s a really big number, really scary. So is just about every number connected with the United States budget. We are a huge country with a huge economy. Competent reporters would focus on this being about 90% of US GDP. Is that big? Well, the debt to GDP ratio was over 110% after the second world war. The United Kingdom had debt to GDP ratios of more than 100% for much of the 19th century, as it was establishing itself as the world’s pre-eminentindustrial power. Japan has a debt to GDP ratio of more than 220% of GDP and can still borrow in financial markets long-term at interest rates of less than 1.5%.

So, what’s the problem? The politicians who want to cut social security and Medicare obviously want the public to believe that there is a huge problem and – due to the incompetence of the media – they have managed to instill fear throughout the nation about this massive non-problem. If the media were doing their job, the public would be able to put these debt numbers in context. And the politicians who attempted to exploit fears based on ignorance would be subjected to ridicule. For example, when Senator John McCain was basing his 2008 president campaign on attacking the $1m spent on creating a Woodstock museum, competent reporters would have barraged him with questions as to whether McCain understood that this came to 0.00003% of federal spending.

They would ask him how much time he thinks that Congress should spendscrutinising three hundred thousandths of 1% of the federal budget. If Congress spent one minute debating every McCain Woodstock museum-sized expenditure, it would take it 6.3 years to get through this year’s budget, assuming that it was in session 24 hours a day, 365 days a year. In the same vein, when a politician asserts that social security is going bankrupt and that there will not be anything left for her children or grandchildren, serious reporters would ridicule her for being ignorant of the social security trustees projections. These projections show that even if nothing is ever done to change the programme, future beneficiaries will always be able to collect a higher benefit than current retirees.

The “nothing there for our children” would be treated as a serious gaffe, sort of like then Senator Obama’s comment before the Pennsylvania primary about working-class people being bitter and clinging to guns and religion. The difference is that the social security comment hasdirect relevance for policies that affect people’s lives. When a politician complains about President Obama’s taxes strangling the economy, reporters should ask them whether they know that taxes are less of a burden on the economy now than at any point since the second world war. A politician who is concerned about tax burdens should be expected to know this. If economic and political reporters applied the same sort of investigative zeal to economic and budget reporting as they did to Representative Anthony Weiner’s twittered underwear picture, we would have a much better informed public. Not only would the news stories that we see and hear be much more informative, but politicians would be less likely to make things up to advance their political agenda. If politicians knew that they would pay a political price for making things up about the budget and the economy, then they would be less likely to do it. But we aren’t likely to get competent reporters until it is as easy to fireincompetent ones as it is to fire incompetent school teachers. © 2011 Guardian News and Media Limited

==== my comment: America, the Neo-Corporate Feudalistic kleptocracy.