Apr 082011
 
Entrance to the Planned Parenthood Federation ...

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Do you think there are many great athletes amongst those who don’t care for sports? How about capable accountants who don’t like numbers? Surgeons who are turned off by blood or teachers by kids?

Regardless of a person’s profession, in order to excel, in order to even become competent, there must be some interest on the part of the individual that will motivate them to perform. Great musicians love music; great scientists are inspired by science; engineers find reward in design and creation, nurses in providing care, and programmers in writing clever code. In order to have effective government, it’s absolutely essential that our elected officials are motivated to “govern,” because those who can’t govern — politic.

This sad truth is the real story behind the cavalier attitude held by the House Republican majority now pressing for a shutdown of the federal government. They have abandoned their constitutional responsibility to fund the government in favor of seizing an opportunity to forward their political agenda, and they’re holding millions of Americans hostage in the process.

As required by legislation, President Obama fulfilled his duty and presented the Congress with a budget for fiscal 2011 in February of 2010. That budget was supported by Democrats in Congress but was blocked by Senate Republicans who would not agree to pass long-term funding. When the new fiscal year started in October of 2010, the government had to be funded or else face shutdown, and the response was bipartisan agreement to pass emergency funding in the form of a “continuing resolution” or CR.

Since that time, the federal government has been funded through a series of CRs, six in all, with the last remaining in effect until midnight tonight. A great outcome for Republicans, who appreciate the fact that the CRs essentially freeze spending at 2010 levels and prevent the implementation of the new healthcare law and financial reform bill. But for the state and local agencies that don’t receive funding under the temporary measures, or for anyone else interested in a functional government, it’s indicative of a failure to govern.

So, with time running out, the debate has surrounded the depth of spending cuts to be passed. The Republicans responded to the President’s $3.64 trillion budget proposal, with a proposal of their own that contains $61 billion in cuts all coming from the $441 billion slice of the budget consisting of non-defense discretionary spending. These cuts are all directed at programs that benefit the needy and the nation as a whole. From billions in cuts to education and HUD and more than $3 billion from the EPA, to nearly $1 billion from energy efficiency efforts, over $1 billion from FEMA First Responders, and nearly $2 billion from job training. Over half ($33 billion) of the Republican’s planned cuts are at the expense of  labor and transportation/housing.

Desperate for a compromise solution, President Obama and the Democrats have countered the Republican proposal with an additional $33 billion in heavy spending cuts to social programs. According to Senate Majority Leader, Harry Reid, they even upped the ante to $38 billion, in exchange for Republicans dropping all policy riders (i.e. specific policy positions, like cuts to EPA, etc.). But Republicans, led by Speaker John Boehner are still refusing to compromise, with the last remaining bone of contention apparently the $317 million in federal funding for Planned Parenthood.

Of course, Boehner still contends that the debate is over “spending.” So, according to his map of the world, the $23 billion difference in spending cuts, a whopping 6-tenths of 1% of the federal budget, is worth shutting down the government of the United States.

A shutdown would mean disruption of government services, including pay for military personnel. It would delay processing of applications in several federal programs, close national parks and museums, and require furloughs for 800,000 federal workers. Nobody knows how much a shutdown would cost American taxpayers, but the toll of closing the parks alone is estimated to be $32 million per day, with the lion’s share impacting small businesses in local economies.

So, whether you buy Boehner’s spin on the divide or not, the fact of the matter is that there will be a price to pay for a shutdown, and regardless of the Speaker’s true motivation, the rider to defund Planned Parenthood is still in the mix.

Republicans, and especially Tea Partiers, have painted a target on Planned Parenthood as the national bastion for abortion. According to Senator John Kyl (R-AZ), abortion services amount to “well over 90 percent of what Planned Parenthood does. The truth is that they actually account for only 3% of services, with the other 97% being centered on preventative assistance. The real focus being reproductive care for women who can’t afford alternatives, Planned Parenthood provides millions of breast exams, Pap smears and other services to a population where 75% of those treated live below the poverty level.

In the end, if there’s any legitimacy in Boehner’s claim that “the big fight is over the spending,” then the Republicans need to end their assault on Planned Parenthood. Federal law has prevented the use of federal funds for abortion since 1976 anyway, and $317 million of the federal budget is less than we spent in a single day bombing Libya.

Rep. Paul Ryan (R-WI) has already rolled out the Republican proposal for the 2012 budget. That’s where the fight on spending cuts needs to move. After all, fiscal 2011 is already half over.

Right now, Republicans need to drop their “government is the problem” position and pretend for a minute that they’re actually interested in governing. They need to recognize that the Democrats have already compromised to the tune of 62% of what’s been demanded. They need to understand that good governing isn’t based on winner-take-all.

They really need to set aside their partisan agenda long enough to put the wellbeing of our nation ahead of their political gain.


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Feb 132011
 
Federal Spending

Image by Mike Licht, NotionsCapital.com via Flickr

If somebody told you that they wanted to lose weight, but they wouldn’t increase exercise or cut their caloric intake, would you believe they were being earnest? How about a friend who says he seriously wants to get out of debt but has no plan to increase income and is only willing to trim the most marginal of expenses? If these cases seem to be obviously insincere, then why does anyone believe that House Republicans have any real interest in addressing the deficit?

Reuters reported shortly after 4:00pm EST on Friday that House Republicans have sharpened their pencils with further slashing in their spending-cut plan that will now total $60 billion. But even at this higher level, which is nearly double their total announced earlier this week, how serious is a plan that will trim the $14 trillion debt by only 4-tenths of 1%? The Republicans are already patting themselves on the back, but since $60 billion in cuts amounts to less than 3 months of interest payments on the debt, should Americans really join the celebration?

The specific problems with the Republican plan are many, but they really all emanate from the conservative framework on which the plan is based. First, and most obvious, is their ridiculous premise that the deficit must be addressed while simultaneously lowering taxes for everyone, including the very wealthy. This is analogous to that person who claims they want to lose weight but won’t exercise — they’ve cut the options in half and in turn doubled the stress on what’s left. With all trimming reliant upon appetite control, dieting starts to look a lot like starvation.

This is far from the way America handled this issue in our glorious past. While climbing out of the Great Depression, our country was hit with the expense of World War II. The economy was invigorated (from forced government spending) and unemployment turned to overemployment. But the national debt, which had been around 43% of GDP, did climb to more than 121% by the end of the war. Undeterred, a united America shared the burden and that debt was steadily paid down post-war, with the debt reduced every year through 1974 (except a slight bump in 1949).

Federal debt bottomed in 1981 at below 32% of GDP, and the remarkable recovery was achieved almost entirely without cuts in spending. In fact, federal spending has increased in all but 4 years since 1947. The solution to the huge debt brought about by WWII was not austerity, but exactly that which Republicans have removed from the table — high top marginal tax rates. The 24% rate in effect when the market melted down in 1929 was raised to 63% in the early 1930s and sat at 81% when the nation went to war. It spent many years over 90% and never dropped below 70% until 1982.

The notion in post-war America was that those who benefited most from our society should give back accordingly. It was an ethic based on the premise of unity, of patriotism and the greater good. The wealthy were taxed heavily on their top marginal dollars, but contrary to the scary scenarios of economic ruin predicted by contemporary Republicans, the economy flourished.

Our economy boomed into the mid 1970s, bringing about a sort of golden age of American capitalism. During that period the GDP multiplied many times over, the middle class swelled, unemployment remained low, and prosperity was shared by most Americans. The rich still got richer, but not at a rate significantly faster than the rest of the populace. Massive concentration of wealth was avoided, and the bottom 90% of Americans enjoyed their peak income year in 1973. Through it all, we remained a country united.

But the sense of unity that had thrived for more than 30 years was lost in the early 1980s. The oil crisis of the 1970s, coupled with a massive influx of imported goods, brought about extremely high inflation and resulted in the heavy loss of jobs. This confluence of events caused the American people to lose faith in the government programs that had given us decades of prosperity, and laid the groundwork for the presidency of Ronald Reagan.

Reagan was elected president by running on a government-is-the-enemy platform. He cut taxes, slashing the top rate first to 50% and later to 38.5%, while also dropping the bottom rate from 14% to 11%. Unemployment was slowly improved, averaging 7.5% for his eight year term, and the economy did recover. But before Reagan left office, he made the unprecedented move of lowering the top tax rate to 28%, while simultaneously raising the bottom rate to 15%.

So began the era of Reaganomics. Hacking the top tax rates while raising the bottom, along with huge increases in military spending and cuts to Medicaid, food stamps, education and the EPA, the pendulum had swung. America became a nation divided between the haves and have-nots, and the national debt began to swell. While the federal deficit had never climbed over $80 billion prior to Reagan, it never dropped below $128 billion during his term. After decades of paying down the debt, it soared from $1.1 trillion under Reagan’s first budget to $2.9 trillion for his last.

Deficit spending had existed under previous presidents, but for Reagan, it was the core of his budget policy. When Reagan left office, he left behind the budget framework for the new Republican Party. That framework is still being followed by John Boehner’s Republican House: lower the top rate, feed the corporations, cut the estate tax, deregulate anything and everything, protect defense spending, and cut whatever else remains. It is under the umbrella of these mutually exclusive objectives that Boehner’s House has created their plan to address the deficit.

The problem with the Republican budget planning process is not just that it exacerbates the deficit problem by insisting on tax cuts for the top 2% of Americans; it’s also the narrow slice of expenditures that they will even consider to subject to their budget knife.

Our federal budget for 2011 amounts to $3.64 trillion. That total is split between $247 billion of interest payments on the debt, $2.1 trillion in mandatory spending (consisting mostly of Social Security, Medicare, and pensions), and $1.2 trillion of discretionary spending. Since the vast majority of mandatory spending comes from entitlements, which are by definition funded outside of income tax revenues, this leaves the substantially smaller discretionary pie from which to cut — and once the Republicans protect their sacred cows, few slices are left on the table.

At approximately 58% of discretionary spending, the price tag for the military accounts for the lion’s share of the pie. This includes around $550 billion for the Department of Defense and another $170 billion for the Nuclear Security Administration, Homeland Security, Veterans Affairs and related programs. Add another $159 billion for “Overseas Contingency Operations” (our Middle East wars), and the Republicans have stashed away all but 4 pieces of that 10-piece pie before it gets served up for cutting.

So, using the Republican framework for deficit reduction, the process starts with tax increases and military cuts pulled completely off the table. That leaves around $441 billion in government spending that’s subject to the Republican axe. Remove from that other Republican pet pots, like the $20 billion or so in oil company and other corporate subsidies, and it becomes evident how much the Republicans are like that person who allegedly wants to lose weight but won’t exercise. It is true that they’re willing to do some dieting, so long as they don’t have to give up any carbs or fat.

The result is a Republican budget proposal that leaves their campaign benefactors happy and instead cuts deeply into programs that benefit the needy and the nation as a whole. Their latest plan cuts billions from education and HUD, slashes more than $3 billion from the EPA, cuts from the FBI, reduces state and local law enforcement assistance, cuts from the FDA, trims nearly a $1 billion for energy efficiency efforts, cuts into science funding, NASA, the GSA, IRS and Treasury, trims the Army Corp of Engineers, slashes over $1 billion from FEMA First Responders, takes nearly $2 billion from job training, and drains billions more from the DOT. At a time of high unemployment and a decaying national infrastructure, over half ($33 billion) of the Republican’s planned cuts are at the expense of  labor and transportation/housing.

This is Republican economics at its finest. Their practices seem more consistent with some sort of Bizarro World Robin Hood, where the hero is actually a villain, and he steals from the poor to give to the rich. This is not the ethic upon which America was conceived. It is precisely the evil of elitist selfishness that the Founding Fathers strived to defeat.

Our present economic woes are not the result of over-taxation or excessive regulation. No, the causes of our nation’s ills are exactly the opposite. Our ailment is rampant greed and a steady decline in the middle class that stems largely from the massive concentration of wealth that’s occurred over the past 30 years. Today, the top 1% of Americans holds more financial wealth than the bottom 95%, and this Republican budget plan is nothing but another dose of the poison that brought us this disease.

Americans do need to be concerned about the federal debt, but the way to address it isn’t on the backs of the poor, working and middle classes. Our shared debt has been much larger as a portion of GDP in the past, and the formula for recovery and prosperity has already been proven. The Republicans refuse to follow that formula because their plan isn’t about the debt. If it was, tax increases and cuts in military spending would still be on then table.

The wellbeing of our nation is at stake, and the Republican House has proven itself to be either disinterested or completely incapable of prescribing the necessary action. It’s time for the American people to stand united and tell these thieves that we’ll no longer stand for their hypocritical nonsense. If they believe the deficit to be a major issue, then address it in earnest. If not, then abandon the false focus and help with the programs we need to create jobs and restore prosperity to the middle class.

Whatever the case — it’s time for all of our elected officials to cease their infernal shell game, stop the finger pointing, and for once dispense with the snow-job and TELL THE FREAKING TRUTH!


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Jan 292011
 
Created by vectorizing Image:Medicare and Medi...
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It appears that House Republicans may soon be launching an attempt to privatize Medicare. House Budget Committee Chairman Paul Ryan (R-WI) is testing support for his idea to replace Medicare with a so-called “voucher” system that would require recipients to purchase coverage through a private medical plan.

According to Michael Steel, spokesman for Speaker John Boehner (R-OH) — as of Thursday, “No decisions have been made . . . there are a lot of ideas out there.” So, we’ll have to stay tuned to see where this goes, but in the meantime, a closer look at the situation is definitely in order.

So, let’s see: the problem is that we have rapidly escalating healthcare costs and a growing population of elderly who will be reliant upon Medicare. Either situation would present a major economic issue by itself, but taken together the impact is of historical proportions.

Looking at the cost of healthcare, we have soaring premiums, deductibles, and copayments. Premiums alone nearly doubled between 2000 and 2008, and the total out-of-pocket for the average family climbed by more than 30% just between 2001 and 2006. The problem is so large that healthcare spending as a portion of GDP jumped to 17.3% in 2008 — the largest increase since 1960 — and it’s expected to climb to over 19% within the decade. We’ll be spending nearly $1 out of every $5 on healthcare.

Meanwhile, in spite of spending levels that are more than twice the OECD (Organization for Economic Cooperation and Development) average ($7,538 per capita in 2008) we trail most other developed countries in health outcomes. OECD data shows the U.S. ranking 26th amongst 34 nations in life expectancy and 30th for infant mortality. We may have the best healthcare available for those who are either wealthy or well-insured, but for the rest of us, we simply pay more and get less.

But alas the news isn’t all bad. All that money we’re spending is providing a great deal of benefit . . . for the bank accounts of the medical insurers and pharmaceutical companies. The 10 largest insurers are reaping a plentiful harvest. They’ve seen their profits soar over 250% from 2000 to 2009. In fact, they’re doing so well that despite a struggling economy, the top 5 insurers still managed to book a 56% jump in profits during 2009 alone.

So, what’s the GOP solution for this mess?

Well, we need look no further than the last major healthcare legislation authored and passed by Republicans to understand their priorities and strategy. That effort brought us Medicare Part D as part of the Medicare Modernization Act of 2003. The bill was passed with the support of only 11 Democrats in the Senate and 16 in the House. It was completely unfunded, and in fact piled on the deficit only a few months after the second round of Bush tax cuts were passed by an even slimmer partisan margin.

Medicare Part D has obviously had its positive impact, providing much-needed prescription drugs to America’s seniors. But with expenditures of nearly $50 billion in 2008 and projected expenditures in the next decade of around $1 trillion, it is without doubt a major source of our nation’s expansion of unfunded liabilities. The sad truth is that these costs could have been contained, but not without price controls. And with corporate profits being sacrosanct to Republicans, the program was designed to prohibit the federal government from negotiating prices with the drug companies. The result is that Medicare Part D pays a 58% average premium on the same drugs purchased by the Veterans Administration, which is allowed to negotiate prices.

So, with anything that might reduce corporate profits off the table, there’s really little latitude for alternative action. Since the federal deficit has already been ballooned to record levels in order to save Wall Street profits, another Medicare Part D unfunded gift to the healthcare industry won’t fly. Add in the strict Republican prohibition against any tax increases that could increase revenues, and the GOP is left with but a single path of action — reduce services.

Vouchers are the answer for maximizing government funding of healthcare industry profits without increasing expenditures. It’s the GOP’s way of saying, “Here you go Cigna. Uncle Sam just can’t afford anymore, but we’ll make sure you get every penny available.”

Of course, the countervailing message to America’s elderly is akin to “Thanks for your contribution. You’re on your own now. We hope you won’t become ill, but if you do, may you die quickly.” But, oh well, that’s life; resources are limited and somebody has to make a sacrifice.

As with most things, the choices we make usually depend on our priorities, and healthcare in America is no exception. There are those who believe that a person who has worked their entire life deserves for the society they’ve supported to reciprocate with this most basic of humanitarian services. These people believe that one of the other variables, corporate profits or tax revenues, should be adjusted to fulfill this duty. Their belief is that we are not only the United States but also a united people.

Then there are others who don’t see American society as a union of all the people. They believe in division instead of unity, in winners and losers. For these people, there is no shame in runaway corporate profits or the skyrocketing wealth of the top 1%, because that’s the way the game is played. They view society as a competition, not a brotherhood. Exploitation is the path to victory, and to the victor belong the spoils.

Everyone understands that healthcare in America is on an unsustainable path. We’re in desperate needs of solutions, and whatever they are, sacrifice will be required. The decision to be made is who will bear the burden. Will we as a nation ask for the wealthy to give out of their abundance or will we take from those least able to fend for themselves?

The answer is all about priorities: people or profits. And we all have to answer for ourselves which side we’re on.


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