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Social Security as you know it, it’s over, forget about it.

I caught a bit of Jennifer Granholm’s The War Room for 2/23/12.  She was talking gasoline prices and had Ron Klain on for his ideas. He is a past chief of staff for Gore and Biden as VP’s. Mr. Klain also published his thought at Bloomberg2/20/12.
This post is not about solving the rising gasoline costs. This post is about the further screwing of the 99% by further reducing their security from the risk of life and living.
Let’s cut to the chase: 
One idea might be a “pocketbook protection” plan, which would work as follows: If the average price of gas exceeds $4 a gallon, an additional, automatic payroll tax cut of 1 percent would kick in, as much as $50 per month, per person. The cut would stay in place for at least 90 days; it would disappear when the price fell below $4.00 per gallon.
There are three advantages to this approach. First, because the plan is of limited duration and is capped at $50 a month, its cost is relatively modest — about $5 billion a month, or $20 billion total, assuming the usual four-month gas-price surge. Second, because it isn’t a reduction in gas taxes, it doesn’t weaken any incentives for fuel conservation or efficiency: All workers get $50 to soften the blow of higher gas prices, but the less fuel they use, the more money they save. And third, the relief provides the greatest relative help to lower-income workers who need gas to commute and feel the price pinch the hardest.
I have to assume our Colberly’s head has just popped. What Mr. Klain has proposed is the exact danger many have warned about regarding the use of SS as a means to make up for what is a major functional problem of our current economy: lack of share of income to the masses.

I have pointed out many times that we can not make up for the $1.1 to $1.4 trillion per year of income no longer in the hands of the 99% that is in the hands of the 1% with tax reductions. It can not be done. With that fact, considering taxation reduction in any form as a method to address this specific issue is nothing more than the continuation of the false economy that financialization created as observed from the position of those in the labor part of the economy. It quite literally is the government now using the mathematical gymnastics pioneered by Wall Street to trick the masses into believing that home equity was the same as earned income. Getting a tax cut anywhere is not the same as receiving a greater share of the nation’s income.  It is money, by the way, that you are more than justified to receive because you helped to create it. The rich used to have an opportunity to relearn this lesson every time there was a major strike, say the NY City trash collectors going on strike.
People, I hope we have learned that one’s home, your house has a more important roll to play in your life other than that of asset appreciation. The home is one of the foundations used to reduce the risk of living, of having a life: shelter. Social Security is another one of those life’s risk reducing foundations: longevity. I have asked often here: How many times to do we have to relearn a lesson?
Using SS as a means to offset the results created over the long term from bad policy is the polluting of a very good policy. We can look at the housing crisis as another already experienced pollution. The good policy was promoting home ownership. The bad policy was setting up an economy that changed the perception of home ownership from a life risk reduction activity to an asset building activity. Now that SS has been used once as a solution to an unrelated problem and extended once in a manor that moves it further from the original purpose (reduction of risk of living), with Mr. Klain’s proposal, the use of SS as a back stop for non-related policy results has become an unquestioned and considered reasonable use.
Mr. Klain’s proposal so exemplifies what our politico’s now consider acceptable for SS’s use that he even proposes to pay for it via a general funding solution: 
The plan could be almost entirely paid for with a modest, no-loopholes surcharge on corporate taxes on profit derived from the higher gas prices. The administration would be able to avoid pejorative terms such as “windfall” or “excess” profit tax, because the tax is neither confiscatory nor punitive. With higher gas prices, oil companies will make record profit — and a partial surcharge will still leave that profit at record high levels. In other words, the plan isn’t vulnerable to suggestions of creeping, soak-the-rich redistribution. It would leave in place all incentives for oil companies to increase production, do more research and development, and explore alternative fuels. But a modest surcharge would help fund at least a partial pocketbook protection program to make sure the cost of the oil companies’ gain isn’t excessive pain for the rest of us.
Just to be clear, that Mr. Klain proposes using SS for anything other than SS is the problem. The only difference in such action compared to the housing crisis which was tied to the removal of specific banking regulation is that it took us 10 year or so to experience the warning of Senator Byron Dorgan.

For those warning about the proverbial slippery slope phenomenon of using SS as a back stop for bad policy results leading to furthering the destruction of SS, it’s only been about 3 years since this application of SS first became a reality. This use is now acceptable. Social Security has now officially been changed from a purpose specific funded program to an general revenue program.  The establishment is so comfortable within this frame of use for SS we get a proposal such as Mr. Klain’s.   We also have on the record a warning in the vein of Senator Dorgan’s  from Senator Harkin:
“This Congress will be making a grave mistake — a grave mistake — and reinforcing a dangerous precedent,” Harkin said in a dramatic Senate floor speech late Thursday.
Mr. Klain freely proposing another application of a SS tax cut is proof of the truth to Senator Harkin’s warning.  The precedent stands.  It is “codified”.   And, with this precedent the conservative/monied movement has neutralized another barrier protecting SS and it’s status as the end-all be-all of the New Deal: the Democratic Party.
The Movement has also successfully completed the instillation of it’s virus known as Financialization into the nervous system of our government. Social Security no longer thinks as the mind of one living in a labor economy; as the 99%.  It thinks as the mind of one living in a money from money economy; as the 1%.

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What about me!

by divorced one like Bush

So I’ve been thinking: What, since the passage of Medicare has the federal government implemented that actually reduced the risk of living for the US citizen?

No, tax cuts do not count. They do not reduce risk. We have reduced risk for business all over the place. NAFTA, CAFTA, exemption of HMO’s from anti-trust, removal of banking regulation, reduction of oversight, allowing payment in the form of stock options, all of these promoted ever larger and thus less competition and thus less risk. All of them allowed a bigger piece of the income pie, thus reduced risk by increasing income. Tax reductions do not increase income, just decrease expense and ultimately reduce services that people relied on to reduce the risk of living in the US. We protected Harley Davidson, we financially backed bad business results. We reduced the 5 mph bumper to 2.5 for the auto industry. None of this has reduced the risk of living, and have actually increased the risk of living in the US.

Katrina? Lead paint in Asian products, contaminated food. Cut’s in education, medical, civil services, infrastructure failure. Privatization may have reduced some costs, deregulation may have decreased some costs (the supposed Walmart benefit), but all of it shifted cost to the individual removing it from the collective. It has resulted in a greater risk of financial ruin in an environment that has decreased the share of income to the 99%. Not having a corresponding rise in income with a rise in productivity only served to increase risk to US.

I want to know of a piece of legislation that actually removed or significantly reduced the risk of living life in the US such that the US citizen was that much closer to succeeding in their pursuit of happiness. I’m not interested in some little piece for a sector of the citizenry. I want to know if anyone can name a piece of legislation such as Social Security, 40 hr work week, Civil Rights, Medicare that has passed since Medicare that actually reduce risk for US such that We the People felt that much more secure in our individual lives in that fear has been reduced.

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There’s almost $200 lying on the street; WWTD?

Since I’m cash-strapped for the next few years, I’m looking for ways (legally, semi-legal, other) to make money.

Thank the L-rd for WaMu.

Let’s see: HELOC is at Prime – 0.76%, currently 4.24%. So I can:

  1. Take $25,000 from HELOC.
  2. Invest in FDIC-insured WaMu CD for 12 months at 5.00%.
  3. Profit until the fourth 0.25% rate hike, which should be at least a year.

Make $190, give or take, risk free if nothing changes.

Hmmm, maybe I should make that $50K. In the form of my new motto: WWTD? (What Would Tyler Do?)

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Just a distraction

25*30 = 750

104/750 = 13.9%

For those more conversant in the “disincentives of enforcement” literature than I, can you back into the Rational Expectation of Enforcement Practices that would lead nearly 14% of a population to conclude it is maximizing utility?

And, given your calculation, what would that say about the Management Practices of the organization?

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