WaPo (inaccurately?) reports "consensus forming" on deficit
by Linda Beale
WaPo (inaccurately?) reports consensus forming on deficit
crossposted with Ataxingmatter
The buildup in the corporate media supporting the corporatist wishlist on budgeting is growing. First there was the clamor about the Bowles-Simpson road map to conquering the deficit–depicted as a reasonable, middle-of-the-road approach. Bowles-Simpson is a neo-liberal/neo-conservative group of people with little understanding of the predicament of the vulnerable middle class in this economy, and apparently as little creativeness for moving the economy out of the stagnation from the four decades of Reaganomics and into a new era of broad-based growth that lifts all boats, rather than just the yachts of the already rich and famous.
Then there was even more clamor about the more “radical” plan put forward by Alice Rivlin and cohorts. Rivlin is another neo-liberal Clintonite who is perfectly willing to sacrifice the New Deal to get the neo-deal.
Obama doesn’t seem willing to fight any fight. He quits before he starts, disgusting liberals who understand that a democracy cannot survive based on the kind of “free market capitalism” espoused by the oligarchs who benefit from it. So there is already talk of extending the Bush tax cuts for the wealthy, which have nothing at all to do with jobs, entrepreneurship, innovation, or growth of the US economy and everything imaginable to do with elitism, power, and hording of productivity gains for the G.W. Bush fan club of have-mores.
So it is perhaps not so surprising that the WaPo is already declaring that a “consensus is forming on what steps to take in cutting the deficit.” Story by Lori Montgomery, WaPo, Nov. 22, 2010. Ms. Montgomery takes the pundits and neo-con/neo-lib descriptions as god’s truth as she describes “a surprising consensus” around “the sacrifices necessary to achieve those goals [of less debt and smaller government]” being “Big cuts at the Pentagon. Higher taxes, including those on home ownership and health care. Smaller Social Security checks and higher Medicare premiums.” Once again, the neo-con faction has used its corporate-owned media to hone its message that there is no choice (false note of sadness) but to cut those deficit-causing “entitlements” like Social Security and Medicare.
The awful deed is required, she suggests, to avoid a “European-style debt crisis.” No real analysis is there. Once again we see the proof in the pudding: the corporate media has discovered that it can deliver press releases and paid interpretations of events much more cheaply than it can do investigative journalism with smart journalists paid a decent salary and provided decent benefits. Infotainment, not news; opinion, not facts; rehashing of partisan positions, not analysis.
- No mention of the fact that the Euro zone nations do not have monetary sovereignty. The story ends with the scare-tactice line (from a Republican strategist, so part of the framing intended to make it acceptable to cut Medicare and Social Security while providing more tax cuts to the wealthy) “if we don’t act [to cut the deficit], we will be Greece.” That’s simply not true. We are not in the same position as Greece. We need to do some things, but we have many more choices than Greece (though the Republican path of tax cuts for the wealthy and spending increases on programs that benefit big corporate interests tend to reduce those choices). While I don’t entirely agree with the monetarists who want us to print our way out of debt and deficits, there is some basis for printing more dollars to meet national needs, stimulate the economy, and avoid more borrowing. That is not an option for Greece.
- No analysis of the tax proposals–lower rates even with closing some loopholes will generally mean more of the burden is passed to the middle class and taken from the wealthy. Merely repeats the Republican notion that lower tax rates lead to economic growth (they don’t–just look at the historic pattern of growth and tax rates–we have higher growth when we have higher rates, likely because it leads to better allocation of resources).
- No mention of the fact that the health reform bill, when it kicks in, should begin the process of reducing health care costs, or of the fact that a much more cost-effective solution–rather than cutting benefits to those vulnerable elderly and sick for whom Social Security and Medicare is a lifeline–would be to throw the rent-seeking health insurers out of the primary business of determining who gets health care and let them make their non-rentier profits on supplementing a national health care single-payersystem similar to Canada’s or Britain’s or Germany’s–anybody but our failed profits-for-financial-institutions-at-the-cost-of-care-for-ordinary-Americans system.
- No mention of the fact that Social Security is not even officially part of the deficit–that in fact we have borrowed from the funds paid in by workers who are now retiring so that we could create a tax-haven economy for the wealthy and corporate elite or the fact that whatever shortfall Social Security might (but not necessarily will) face in future years is EASILY solvable by extending the tax to full wage income of all workers (and, for this purpose at least, acknowleding that payments from hedge and equity fund partnerships to service partners in respect of their “profits” interest are compensation that is subject to payroll taxation). Social security should be off the table because it ain’t broke, any future fixing that it needs is simple and equitable, and it has been put on the table by the same monied elites that at the same time work to ensure that their favorite tax breaks and other benefits stay in the system (such as the charitable contribution deduction for the value of stock, rather than the basis that represents the owner’s actual investment in the stock). Instead, the Bowles-Simpson right-wing dominated group would reduce benefits for all retirees by redefining their cost of living needs (in spite of the fact that the current formula is probably weighted too lightly on the kinds of expenses that the elderly face, they would suggest a formula that would be even less likely to keep the elderly who depend on SS on an even keel); means-test Social Security (thus destroying the key element of the near universal support of the program); and raise the retirement age (to 69) meaning that some people who get nothing whatsoever from the years invested and many in manual labor jobs would be worn out before able to retire.
- No mention of the fact that Alan Simpson, Obama’s choice to co-chair his so-called Commission on Fiscal Reform (it should have been called–neo-lib/neo-con commission for cutting benefits under Social Security and Medicare), has consistently targeted Social Security (and other New Deal programs) as a huge unearned entitlement that should just be gotten rid of or at least whittled down to the bare bones if at all possible. See e.g., Alan Simpson Calls Social Security ‘Cow with 310 Million Tits,’ Causes Uproar, TPM Muckraker, Aug. 25, 2010. It’s no surprise that a commission made up of elitists –including nine Republicans that the Business INsider site politely calls merely “tax averse” (see Beutler, Meet the 18 People Who Could Determine the Fate of Social Security“, Aug. 30, 2010) opts for solutions that favor elites.
- No mention of the fact that Social Security funds were required to be invested in US Treasuries-(see Trust Fund FAQs,” Social Security Administration, February 18, 2010)
The SS surplus funded US debt at the same time that huge tax cuts were enacted in favor of corporate and wealthy elites, but now the neo-con/neo-lib move to decrease benefits is essentially a call to reneg on commitments made to those that funded the surplus and borrowing.
- No mention of the fact that most of the Bowles-Simpson crew held pre-determined positions that favored reducing the programs that help the poor and vulnerable (see Beutler, Meet the 18 People Who Could Determine the Fate of Social Security“, Aug. 30, 2010) :
- Bowles himself, a Wall Streeter Clintonite Dem who was not very strongly against privatization when he was chief of staff;
- Simpson, who has supported privatization and benefit cuts to Social Security for deaces,
- Rivlin, another bank-friendly Clintonite who has long argued for cutting Social Security benefits;
- Stern, a former President of the SEIU who has supported the idea of investing Social Security funds in the stock market rather than in US Treasuries;
- Cote, Republican CEO of Honeywell who has advocated cuts for military servicemen and women rather than defense contractors like Honeywell;
- Fudge, an Obama supporter who has been in business at Kraft Foods and Young & Rubicam (so is likely to support business friendly solutions whether they are good for the vulnerable or not)
- Paul Ryan, Republican advocate of austerity budgeting, Social Security privatization, and Medicare vouchers
- Jeb Hensarling, Republican advocate of austerity budgeting and privatization and cuts for Social Security and Medicare
- Dave Camp, Michigan Republican that wants tax cuts, and Social Security privatization
- Judd Gregg, Republican interested in raising retirement age to 70, privatizating Social Security, shrinking government by “starving the beast”, and yet doesn’t think tax cuts should be offset
- Tom Coburn, Republican from Oklahoma who says he’s “open to everything if it gets us where we need to go” regarding the commission’s deficit reduction aims, BUT hypocritically opposes not providing an additional tax cut for the wealthy. Coburn wants to “dismantle large segments of the federal government” and wants all options on the table except preserving current structure and benefits or increasing SS taxes (on the wealthy). He also wants to cut pay and benefits for military dependents, retirees and survivors. Funny, he doesn’t mention generals or defense contractors. Coburn has consistently worked to eliminate the New Deal programs oriented towards the ordinary and middle class folks.
- Mike Crapo, Republican who wants to privatize Social Security and reduce benefits for anyone born after Jan.1, 1950.
- John Spratt, blue-dog Democrat who has long advocated changes to Social Security, including supplementing SS with private plans
- Xavier Becerra, democrat who may actually oppose changing Social Security
- Jan Schakowsky, progressive democrat who opposes entitlement cuts and fought for the public option
- Kent Conrad, Democratic budget hawk who opposed the public option, supports passing new tax cuts that extend the Bush cuts for everybody, though arguing for tax increases eventually
- Max Baucus, Democrat who supported Bush tax cuts (imagine where we might be if he had fought instead for ordinary Americans) and has consistently supported decimating the estate tax and has supported the idea of Social Security cuts
- Dick Durbin, a progressive Democrat who nonetheless has been open to cutting Social Security
No analysis is there. What Montgomery puts forward as supporting the idea of a national consensus is the Bowles-Simpson vague statement of a roadmap; the Rivlin-Domenici panel, another neo-lib/neo-con dominated group whose prescriptions are predictable; Frank Keating, a Republican who wants lower income-tax rates and a national sales tax (perfect for the wealthy in passing the burden of taxation to the middle class); and retired military officers and national security experts who agree that the hugely bloated Pentagon budget can be reduced (can’t we ALL agree on that one?). That’s a national consensus? I don’t think so.
Regretably, she ends with a quote from Domenici (not a moderate by any means) saying that the fact that there is some common ground about cuts and tax increases among this disparate group is “‘a testament to the moderate nature’ of the ideas under discussion”. No–it is a testament to the ability of one view to dominate the media and to be presented as a growing consensus on the need to cut the welfare programs that are the backbone of the New Deal, in order to frame the discussion in a way that pushes it towards a single conclusion.
For a different perspective, see DAvid Coates, Eating the Old at Thanksgiving (nov. 22, 2010).
Linda Beale, who no longer participates in the comment threads at Angry Bear, writes a typical putdown post focusing on an article written by WaPo’s Lori Montgomery.
Beale misses the boat badly because she has a poor understanding of what Montgomery stated in the article, and an apparent lack of knowledge of previous articles written by Montgomery on the subject of the fiscal commission and its members’ opinions. Montgomery never claimed that there was a national consensus, a bogus claim by Beale. Moreover, there is potential evidence that Beale doesn’t fully understand the possible outcome of the growing financial problems of the European nations whereby the ECB simply will not be in a position to provide complete bailouts for Spain and Italy, should those nations go down the financial tube as well.
Montgomery’s article, “Consensus is forming on what steps to take in cutting the deficit”, has two titles within the WaPo presentations. The other title, “Some accord seen in debate over deficit”, is identified on a sidebar deficit plan comparison piece as well as on a Google search. Beale doesn’t appear to know that. Montgomery previously wrote a number of articles on the commission’s efforts including one last week (November 17, 2010) titled “Bipartisan agreement on balancing budget may be harder than thought”. That article painted a different picture of commission members’ opinions. The latest Montgomery article, focusing in part on quotes from commission members, counters some of the previous thinking that a consensus among commission members was highly unlikely if not impossible. Whether that is ultimately the case is another matter. It is clear, though, that Montgomery was continuing her series of articles on the commission members’ thinking and not that of the nation’s citizens. Hence, Beale’s putdown claim is bogus.
Beale also claimed that Montgomery didn’t do any analysis. Montgomey’s latest article includes a sidebar comparison of three different fiscal year deficit/national debt reduction plans. That piece provides a side-by-side comparison of three proposals, the third being the Galston/MacGuineas plan proposed on September 30, 2010. Beale failed to acknowledge that fact. Similarly, Montgomery’s previous piece on November 17 included a sidebar graphic presentation, “A bolder deficit plan”, which compares the commission cochairs draft proposal with and without changes to Social Security to projections under current law, the President’s budget proposal, and CBO’s baseline budget analysis. Again, Beale fails to make mention of that fact. Montgomery, by the way, has never claimed that she has performed any detailed analysis of the various fiscal years’ deficit/national debt reduction plans.
I seldom if ever defend journalists’ presentations, but Beale’s arrogance in this case is well over the top due to a lack of basic research on her intended victim. Beale just used the putdown attack on Montgomery to vent about two of the deficit/national debt reduction plans and, of course, corporate America.
I could care less if Beale intends to rant endlessly about the various deficit/national debt reduction plans, but she doesn’t need to employ misleading phony attacks to support her liberal agenda and anti-corporate America opinions.
MG, you certainly have taken Ms Beale to the wood shed here. Instead of thrashing her, wouldn’t it be more informative if you added to the debate? Sounds as if your agreeing with the position of gutting S.S. ib favor of continuing the destruction of the middle class. Perhaps you’re one of the “elites” who collect the “welfare: that the Government hand out to business/people who should give back instead of taking all the time. It’s time to get real here instead of maintaining the status quo, the country is sick, needs to be rebuilt, the continuing destruction of the safty net isn’t going to remedy the problem. What you don’t say, as I read your comments, is why S.S. is even on the table, why the cap on who pays into the fund isn’t raised to include all income from all who take in the dollar, why the Military budget isn’t chopped, why the retirement age for the Military is raised to 30 years, why the U.S. Military needs to be in just about every country known to man on this earth, why the Military is fighting 2 Wars, with nothing to gain either way, except more expenses to care for the people who have served after they come home, yet even those costs are under attach. I could go on, but when I see people attaching others like you have, then I have to ask what plan do you have to bring the country out of this destructive direction, besides “More of the same”?
Actually, I was wondering if Linda Beale would consider running for office–she would have my vote and finacial support. The most telling comment is that Obama will not fight for the interests of the bottom 95% of Americans. If the Democratic President of the United States will not stand up to the capitalist oligarchs who will? certainly not anybody at the Washington Post or most any other media source. By the by, I note today that business earned record profits last quarter–admittedly in non adjusted dollars. Indeed as my wife left for work today practically in tears after working her 30th consecutive 12 hour day at a midlevel and mid paying salaried position she noted that with her company’s layoffs, productivity and profits are way up–because everyone is desperately afraid of losing their job and working seemingly all the time for the same pay. The dirty secret is that business has no incentive to hire more workers as long as unemployment stays high–it can just get more work out of remaining employees and make record profits that it does not want to be taxed at a fair rate to support the very modest efforts of the government to care for its citizens. Is this a great country or what? Happy Thanksgiving.
while I agree with you and with Linda, I can’t let pass the idea that simply raising the cap to cover all income is a sane solution to the SS “problem.” SS works because it is NOT welfare.
You won’t get the people who have money and power to agree to a “fix” of SS that will raise their taxes.
There is no need to raise their taxes. The workers who benefit from SS can pay for it themselves. In order to pay for their own longer life expectancy they would need to raise their own payroll tax one half of one tenth of one percent per year. That’s about forty cents per week in today’s terms, and the boss pays half.
It causes me despair that the “friends” of Social Security help the people who are trying to destroy it by proposing solutions that assume there is a problem to start with, that are not politically viable, that are not needed, and that would kill social security outright by changing it from a safe way for workers to save for their own retirement to a frank welfare plan.
the over the top rant here is yours. the faults you find in Beal’s commentary are largely imaginary and certainly trivial. the WaPo assumes that SS is the problem and is a reliable propagandist for cutting Social Security. If one is to read an article in the context of other articles… not generally a reasonable expectation… one should be aware of the overwhelming trend of articles in the WaPo.
Rather than regard Beale or anyone else as committing attempted murder by commenting on another article, why don’t you try to think of each comment as part of a conversation in which the parties are free to respond to and learn from each other. not, of course, that that ever actually happens. but then the commented-on rarely die from their wounds either.
MG is hard over on the deficit. He has pointed out that in 2044 interest on the debt will be more than any other item in US G outlays.
Speaking of outlays SS spends 20% of federal outlays about as much as DoD. In the UK their MoD spends less than 7% and is declining fast. Some want SS and DoD to spend the same, only to be fair to the war profiteers.
Some people think that it is a shame that entitleements are 63% of outlays which corporate welfare and war profiteering in only 37% (rose a coiuple since the war on terror and war profiteers’ rising fortunes.
If MG is Movie Guy, he is retired US Army officer, and that means like myself, buff and CoRev SS is probably 3rd or 4th in line of retire income streams.
Although, CoRev and I are much, much older than buff and movie guy.
I’ll vote for Linda. I’m also getting a little impatient with the press, and a little frustrated. Why doesn’t Montgomery’s sidebar comparison of plans include the Jan Schakowsky plan (which Montgomery wrote about 6 days earlier)? Of course that would circumscribe her conclusions about a “consensus.” More disconcerting is that Montgomery isn’t the only one giving scant attention to the one “progressive” plan out there, even though it’s from a commission member–the consensus appears to strongest among those covering proposals. I don’t love any of the plans I’ve seen but if forced to choose I’ll go with Jan and her ideas at this point. Additionally, I’m getting a little angry at the fact that nobody seems to care that conservative plans seek to seriously screw over our veterans and active duty fighters–no, I am neither, but I know some. That’s icing on the cake for plans calling for sacrifices from “everyone” except rich elderly people like Bowles and Simpson (I guess that’s a reward for originally bringing us and then benefiting from the Reagan revolution). If this rant is unfair, well, I guess I’m just an AB today.
Excellent points, Norman. If indeed this is the Deficit That Is Eating the World, then it seems to me that these people would have come up with something a lot more innovative than just “Guvmint Bad….Kill Guvmint…Kill!! SS eating my money..Arrrggghhhh.”
We have a country of more than 300 million people. They need a lot more jobs than are out there even without a D/Recession. But, these guys look at a 14+Trillion buck national debt and decide that the thing to do about it is close down every government program for the 300+million and cut taxes for the 400K at the top of the pyramid. Great idea, guys! Just Great!.
It took more than two presidential terms to amass this debt so we should get rid of it in ummmm…let’s see….maybe 6 or 10 or 12 years. If this debt is so dire a factor in our national life, isn’t that too long? And, if it’s not really the Deficit from Hell, can’t we figure out a better way of dealing with it while developing new industries to employe the people who live here. Why aren’t these guys working for a dollar a year? Why is Peterson still pouring money into a campaign to destroy SS when by all rights, it’s the only thing between working people and economic extinction.
So, Norman, I join you in saying that this whole mischegoss is insane. Thanks for your remark. I look forward to your comments here. NancyO
Terry–Timely and excellent remark. NancyO
it is not quite correct to say that SS spends 20% of federal outlays. it is better to think of Social Security as the workers financing their own retirement insurance. the federal role is simply to manage the program. the money is never properly part of the federal budget.
I’ve been harping on the point that the media is the devil in the equation all along. Hitler had Goebbels and our wealthy Americans have Roger Ailes and too many other publishing honchos that contend that they are main stream. The WaPo is the worst offender, but the NY Times gives it a run for its money in the area of selling the latest political bull shit, like the so called consensus regarding the deficit. There certainly is a consensus among Americans, but it has nothing to do with the tripe that DC, corporate America and the MSM are trying to peddle. Until the “poisoned pens and tongues” of the media change its slant the people will continue to be fed a daily dose of deceit and deception about the structure of their government and what ails our economy. No Virginia, Obama is not a liberal.
Well, since ncpssm directs readers here
i offer my own consensus on deficit reduction:
1) rescind all the Bush tax cuts.
2) raise the payroll tax one half of one tenth of one percent per year.
the bottom 80 percent of workers will not even feel the tax increases. the top 20% will only feel them if they are … well, excessively focused on their “bottom line” which is most cases is so far above their needs or even reasonable wants that they can only focus on it with the help of a tax accountant.
raising the payroll tax would cost the average worker today 40 cents per week.