Raw Story: ‘Why all the Lies?’ Fox News’ Shep Smith Goes off on Trump Administration After Flynn Guilty Plea

The following is an excellent article written by David Ferguson on the Raw Story website on December 1, 2017 titled “Why all the Lies? Fox News’ Shep Smith Goes off on Trump Administration After Flynn Guilty Plea” and I quote:

“‘Why all the lies?’: Fox News’ Shep Smith goes off on Trump administration after Flynn guilty plea”

Fox News anchor Shepard Smith and the network’s legal expert Andrew Napolitano agreed on Friday that Michael Flynn’s guilty plea to charges that he lied to the FBI are an ominous sign for President Donald Trump and his administration.

“Michael Flynn admits now that a senior member of the Trump administration team told him to reach out to the Russians and he did so,” Smith said.

He asked Napolitano about his comments on Friday that we could be headed into a constitutional crisis.

“Robert Mueller has enough credible evidence to charge the president of the United States with a crime,” Napolitano said. “The constitutional crisis will come when he decides what to do. Does he indict the president — which has never happened to a sitting president — or does he merely transfer this evidence over to the House of Representatives which will then be under tremendous political pressure.”

Napolitano explained that Flynn is only a puzzle piece in the body of evidence that Mueller is bringing to bear against the Trump administration.

Smith said that if what Flynn says is true, it brings up another impeachable offense for Trump in addition to obstruction of justice.

Trump has repeatedly insisted that the Russia investigation is a “witch hunt,” that he never had any contact nor did he instruct his subordinates to have any contact with Russians. If what Flynn says is true, however, it opens a whole new area of legal exposure for the president, Napolitano said.

“The crux of all of this — as we have discussed here repeatedly,” Smith said, “is why all the lies? Why, now we know, why the lies from Flynn, why the lies from Manafort, why the lies from Papadopoulos, why lie after lie after lie after lie? What is motivating you to lie? It appears that is at the heart of whatever this is.”

Watch the video, embedded below:”

(REPUBLICAN PRESIDENT DONALD TRUMP IS GOING TO HAVE TO START TELLING THE TRUTH SOON AND IF SPECIAL PROSECUTOR ROBERT MUELLER WANTS PRESIDENT TRUMP TO TESTIFY, HE HAS TO DO IT UNDER OATH.  THAT’S WHY PRESIDENT TRUMP IS TRYING TO FIGHT IT.

LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veteran

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Raw Story: Mike Flynn Took Part in Trump-Putin Call Four Days After Lying to FBI About Russia Talks

The following is an excellent article written by Travis Gettys on the Raw Story website on December 1, 2017 titled “Mike Flynn Took Part in Trump-Putin Call Four Days After Lying to FBI About Russia Talks” and I quote:

“Mike Flynn took part in Trump-Putin call four days after lying to FBI about Russia talks”

Former national security adviser Mike Flynn will plead guilty Friday to a single count of lying to FBI agents — and he could provide damaging information against a number of White House officials.

Flynn had reportedly reached a deal with special counsel Robert Mueller to cooperate in the investigation of Trump campaign ties to Russia, and his guilty plea suggests he gave up useful information against top officials with the campaign or within the White House.

The charging document shows Flynn lied to FBI agents Jan. 24 about two specific conversations with Russian ambassador Sergey Kislyak a month before, which were recorded during routine monitoring of foreign agents and show the pair discussed U.S. sanctions.

Two days after Flynn lied to the FBI, acting attorney general Sally Yates warned White House counsel Don McGahn those false statements made the national security adviser vulnerable to blackmail by Russia.

The following day, Jan. 27, George Papadopoulos, a foreign policy adviser to the campaign, also lied to the FBI about his own repeated contacts with Russian agents — and he pleaded guilty to the same charge as Flynn in exchange for his cooperation with Mueller’s probe.

President Donald Trump summoned then-FBI director James Comey to the White House later that evening for a private dinner, where the president asked for his loyalty.

The FBI director promised Trump his honesty, but the president pressed him to assure his “honest loyalty” — which Comey refused to grant.

On Jan. 28, one week and one day into the administration, Trump and his Russian counterpart, Vladimir Putin, spoke by phone.

Flynn was present in the Oval Office during that call, and he and Trump were joined by Vice President Mike Pence, White House Chief of Staff Reince Priebus, White House Press Secretary Sean Spicer and White House chief strategist Steve Bannon.

Of that group, only Trump and Pence remain the White House.

The Kremlin produced a detailed, 10-paragraph readout of the call, but the White House released only a vague, one-paragraph summary that showed Trump received a “congratulatory call from Russian President Vladimir Putin.”

The White House routinely records such calls, but Ilan Berman, vice president of the conservative American Foreign Policy Council think tank, suggested no such recording existed of the Trump-Putin call.

The day after the Oval Office call to Putin, on Jan. 29, Trump signed an executive order elevating Bannon to the National Security Council and downgrading the roles of chairman of the Joint Chiefs of Staff and the director of national intelligence — a move that most observers considered baffling.

The White House fired Yates the next day, Jan. 30, and Flynn was eventually forced out Feb. 13 after the Washington Post reported Yates’ warning to the White House counsel.

Later that week, Priebus pressed Comey and then-deputy FBI director Andrew McCabe about what the FBI had uncovered about the Trump campaign’s ties to Russia, and Spicer personally connected CIA Director Mike Pompeo and Sen. Richard Burr (R-NC) with reporters to discredit a report linking campaign officials to the Kremlin.

Flynn apologized for what he said were misleading statements to Pence — who oversaw the presidential transition — and Spicer about his contacts with the Russian ambassador.

But Pence was warned in November by Rep. Elijah Cummings (D-MD) about Flynn’s paid work for Turkey during the campaign and his contacts with Russia, and the lawmaker suggested he should not be given access to classified information.

Trump fired Comey on May 8, after asking the FBI director to drop the investigation of Flynn’s activities — a move that prompted the Justice Department to appoint Mueller as special counsel.”

(CAN REPUBLICAN PRESIDENT DONALD TRUMP AND CABINET LIE TO THE FBI AND GET AWAY WITH IT???   IF THEY CAN, THEN WE’RE GOING TO HAVE A NEW CRIME WAVE TAKING PLACE.  THE DEMOCRATS WANT THE INVESTIGATION BUT THEY’RE NOT THE MAJORITY PARTY.  LET’S HOPE THAT CHANGES IN 2018.

LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veteran

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PBS News-Hour: Senate Tax Bill Suffers Blow as Measure Picks Up Support

The following is an excellent report by Judy Woodruff and Lisa Dejardins on the PBS News-Hour program of November 30, 2017 titled “Senate Tax Bill Suffers Blow as Measure Picks Up Support” and I quote:

“Senate tax bill suffers blow as measure picks up support”

Senate Republicans are running back to the drawing board on their tax overhaul after the Senate parliamentarian ruled that a deficit trigger wouldn’t pass muster. That followed a day of meaty, substantive debate on the matter, during which Republicans seemed to fuse together over a bill that would affect every American taxpayer. Lisa Desjardins talks to Judy Woodruff about the latest updates.

Read the Full Transcript

  • Judy Woodruff:

    Our two main stories tonight come from Congress, one on sexual misconduct, the other on taxes.

    We start with the Senate debating into the night on the Republican tax bill, as the measure picks up some important support.

    Lisa Desjardins begins our coverage.

  • Lisa Desjardins:

    In the sharply political Senate, today, a meaty, substantive debate.

  • Sen. John Thune:

    So, the argument again that this is somehow simply a tax cut for the rich just doesn’t pass the smell test. It doesn’t comport with reality. Clearly, the numbers tell a very different story.

  • Lisa Desjardins:

    As Republicans seemed to fuse together over a bill that would affect every American taxpayer, they say, cutting most business and individual taxes. But Democrats argue it’s a philosophical shift toward the wealthy.

  • Sen. Sherrod Brown:

    If my friends here want to give a tax cut to the middle class, why don’t we give a tax cut to the middle class? We do this bill, if we pass this bill, big tax cuts for the wealthiest people in this country, we drive a hole in the budget deficit, we come back and make the middle class and working families pay to fill that hole.

    That’s irresponsible. That’s morally reprehensible, Mr. Speaker.

  • Lisa Desjardins:

    Within minutes, Texas’ John Cornyn, the chamber’s number two Republican, responded that Democrats have no equivalent plan.

  • Sen. John Cornyn:

    They must like the fact that wages in America are stagnant. They must like the fact that working American families have not seen a pay increase because of those stagnant wages. We can’t do better when you have got your head in the sand and the only thing you wanna do is to blow up our efforts to try to improve the quality of life, the standard of living, the take-home pay, and to reawaken the slumbering giant, which is the American economy.

  • Lisa Desjardins:

    Fellow Republican Pat Toomey of Pennsylvania made his party’s central argument, that cutting corporate and individual taxes will grow jobs.

  • Sen. Pat Toomey:

    So that our workers can compete and win against companies from anywhere in the world, so that we will have more jobs, that’s what’s in this bill. And that’s why this is a great deal for the people that I represent.

  • Lisa Desjardins:

    To that, Democrat Cory Booker of New Jersey was happy to respond.

  • Sen. Cory Booker:

    Now, some of my colleagues are going to argue that this bill, giving a trillion dollars to corporations, will somehow result in a trickling down of things like raises for workers, and somehow creating new jobs. But, to me, this is a fantasy.

  • Lisa Desjardins:

    There was another important divide- the process. Democrats like Leader Chuck Schumer stressed there were no hearings on this bill, and a relatively fast debate.

  • Sen. Chuck Schumer:

    The Republican tax bill has made a mockery, a mockery of the legislative process. Republican leaders disappeared behind closed doors, negotiated a framework for a tax bill without a shred of Democratic input. Significant changes will likely be made by the majority leader today.

    We will get huge changes in a bill today and try to vote on it tonight. And this is tax, one of the most complicated issues before us.

  • Sen. Susan Collins:

    I want to express my thanks to the majority leader, my colleagues and the administration for working with me.

  • Lisa Desjardins:

    All this as key votes, like Republican Susan Collins of Maine, seemed to warm to the bill. She indicated that talks she’s had about her concerns make her hopeful.

    But the critical news today may have come with this statement from Arizona’s John McCain, saying he is now for the bill, though he still thinks it’s far from perfect. He said it is generally positive. And he is on board.

  • Judy Woodruff:

    The prospects of passing a tax bill gave another big boost to Wall Street. The Dow Jones industrial average gained 331 points, more than 1 percent, to close above 24,000 for the first time. The Nasdaq rose 49 points, and the S&P 500 added 21.

    As the Senate talked taxes today, many in the U.S. House of Representatives focused on the fate of its longest serving member. Multiple women have now accused 88-year-old Michigan Democratic Congressman John Conyers of sexual misconduct, and, last night, he was hospitalized in Detroit for a stress-related condition.

    In Washington today, House Minority Leader Nancy Pelosi, who had initially called Conyers an icon, said it’s time for him to go.

  • Rep. Nancy Pelosi:

    The allegations against Congressman Conyers, as we have learned more since Sunday, are serious, disappointing and very credible. It’s very sad.

    The brave women who came forward are owed justice. I pray for Congressman Conyers and his family, and wish them well. However, Congressman Conyers should resign.

  • Judy Woodruff:

    Conyers’ attorney flatly rejected the call to resign. He told reporters that Leader Pelosi — quote — “sure as hell won’t be the one to tell the congressman to leave.”

    For more on both of these day’s big stories on Capitol Hill, let’s turn again to our Lisa Desjardins.

    Lisa, I’m going to ask you about Congressman Conyers, but let’s start with taxes.

    Things seem to be moving fairly smoothly toward a vote, but just within the last few minutes, you are telling me that the Senate parliamentarian has come up with a ruling that has caused them to run back to the drawing board.

  • Lisa Desjardins:

    That’s right. This is indeed breaking news.

    I ran from across the Capitol to get there. That’s right, a very dramatic scene in the Senate, Judy, in the last hour, as key senators gathered around the central part of the Senate chamber, and the parliamentarian, we are told, told them that this idea of a deficit trigger cannot pass muster with the rules that are required, what is called the Byrd rule, to pass something under budget reconciliation, which is how they’re going to do this.

    Now, that is a big blow to this bill because, two reasons, one, there are a lot of deficit hawks who said they needed some kind of guarantee that this bill won’t raise the deficit, people like Senator Bob Corker, in order to get their vote.

    I talked to Bob Corker after this news that the trigger can’t pass muster, and he said the plan is now, instead of having a trigger that would change the tax equation if the deficits were — went up, now the bill instead will automatically change the tax structure.

    Judy, what that means essentially is Republicans are now working on restructuring the Senate bill, so that the tax cuts don’t go as deep.

    That could be controversial, and it’s not clear how many votes that could cost. But they’re really retooling now. And the idea of a vote tonight, which is what Republicans hoped for, seems like a very, very long shot.

  • Judy Woodruff:

    Well, one important part of this bill, Lisa, has to do with Obamacare. We know that’s been a priority to Republicans to try to do away with it. Tell us where that stands right now.

  • Lisa Desjardins:

    That’s right.

    And this is important, because we have seen protests here on Capitol Hill all day long. And, in fact, I have been with senators like Senator Flake when their constituents have come up to them and said, don’t vote for this bill.

    And the biggest reason we hear why is health care concerns. Let’s talk about two big health care components in this bill. One is that it repeals the individual mandate, and a reminder that the Congressional Budget Office found that that would mean more than 10 million Americans fewer would have health insurance than do now.

    Some of those would be by choice, but some of those would be people who didn’t sign up for Medicaid because they weren’t paying attention. Another other component of this bill is that it would raise the deficit so much that it would cause automatic spending cuts to programs including Medicare.

    A $25 billion cut is estimated for just next year alone. Now, Republicans say they would vote to reverse that cut, but some folks are nervous because obviously that hasn’t happened yet, and of course there is a medical deduction that would be taken away in this bill.

    Many factors. And, Judy, to add to all that, I neglected to say earlier, on this question of deficits, we got big news today from the Joint Committee on Taxation. They added in something Republicans wanted to see, dynamic scoring, the effect on the economy of these tax cuts.

    And they still found that the Senate bill would add a trillion dollars to the deficit. That’s not what Republicans wanted to see.

  • Judy Woodruff:

    And, Lisa, one other, finally, quick question on Congressman Conyers.

    We reported earlier his support among his own party members, Democrats, eroded dramatically today. What are you hearing about that?

  • Lisa Desjardins:

    That’s right.

    Universally from Democrats and Republicans on Capitol Hill, they say that it is time for Conyers to resign, with one exception. That, of course, is Mr. Conyers himself.

    Talking to some Democrats who know him, who have worked with him, they say they believe that that he is waiting to do it on his own timeline, that he is a stubborn man, or a man who is deep in his beliefs. He says he’s innocent, and they think that he’s not going to want to resign, certainly when leaders call for it.

    A lot of drama today, Judy, here in the Capitol. I can’t stress enough we see big personalities at work, and them still not able to solve all the problems here yet.

  • Judy Woodruff:

    And the debate goes into the night. Our Lisa Desjardins running from one end of the Capitol to the other to cover it all.

    Thank you, Lisa.”

    (FEDERAL INCOME TAX BREAKS END FOR THE MIDDLE CLASS AFTER 10 YEARS AND THEN GO BACK UP.  AS FOR CORPORATIONS, THEIR TAX BREAKS ARE PERMANENT AND WILL BE LEFT PERMANENTLY AT THAT LOW LEVEL OF 20 %.  YOU CAN EASY UNDERSTAND WHY, ALONG WITH ALL THE INCREASED TAXES AND LOSS OF HEALTHCARE, THAT 70% OF THE VOTERS DO NOT FAVOR TRUMPCARE.  YOU WOULD THINK THE LEGISLATORS WOULD LISTEN TO THEM BUT THEY ARE MORE ANXIOUS IN TAKING MONEY FROM THEIR RICH CAMPAIGN CONTRIBUTORS.  THAT’S WHY YOU SHOULD STILL CALL YOUR REPUBLICAN LEGISLATORS AND TELL THEM THEY WILL PAY A PRICE FOR IGNORING 70% OF THEIR MIDDLE CLASS VOTERS.

    LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veteran

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The Elite Consensus on Entitlements and Deficits – Part II

The following is an excellent excerpt from the book “IT’S THE MIDDLE CLASS, STUPID!” by James Carville and Stan Greenberg from Chapter 15: “The Elite Consensus on Entitlements and Deficits” on page 226 and I quote: “”MEDICARE REFORM”: SHIFTING GOVERNMENT’S HEALTH CARE COSTS onto SENIORS Stan  We object to the broad bipartisan conclusion that “enrichment spending is unsustainable” and the most important goal is to get control of the government’s health care spending.

Simpson-Bowles offers the starting point: “Federal health care spending represents our single largest fiscal challenge over the long-run.”  And note: the focus is on cutting back what the federal government spends on health care, not cutting back the cost of health care.  There is a big difference.  This starting point sets off a wave of proposed changes to Medicare and Medicaid–including Domenici-Rivlin’s proposal to “transition Medicare, starting 2018, to a ‘premium support’ program that limits growth in per-beneficiary federal support.”  While preserving the choice of traditional Medicare, this will make Medicare a refuge for the poorest and shift costs to seniors.

That is kind compared to the conservative think tanks that use this debate to abolish the Affordable Care Act and gut federal health programs for seniors–getting rid of “its current defined-benefit philosophy to a defined-contribution system, mostly to serve the poor.”  The first Paul Ryan budget became the centerpiece of the new House Republicans’ agenda for the whole Republican Party.  His budget ended Medicare as we know it, turning it into a voucher program where seniors go back into the market to purchase health insurance–but, criminally, have to pay at least $6,400 more a year.  This year’s Ryan budget shifts to premium support but freezes payments below inflation and thus shifts substantial costs to Medicare beneficiaries while leaving Medicare with the least healthy and poorest seniors.  Saving America from its debts requires transferring the bills to seniors, many of whom are retiring after three decades of work.

And we haven’t even talked about the impact of their proposed Medicaid cuts, the great majority of which would hit seniors.  Most nursing-home patients are there under Medicaid and their care or bills would shift to their families.

The public, to be sure, wants none of this.  Democrats paid a price for seeming to take $500 billion from Medicare to finance the new health care reform law.  Karl Rove wrote, “The administration would cut $622 billion from Medicare and Medicaid, with a big chunk coming from Medicare Advantage, to pay for overhauling health care.”  His attack ads featured a beleagured woman saying, “Instead of fixing health care, my mom’s Medicare will be cut, and our health insurance premiums went up.”

Well, the Republicans have been on the defensive since the Paul Ryan budget was accurately characterized as a plan to turn Medicare into a voucher program.  In our polls, two thirds of voters turned against a House member who voted to “end Medicare as we know it, forcing seniors to pay $6,400 more out of pocket every year and buy insurance directly from the insurance companies.”

And all hell breaks loose when they learned he pushes those costs onto seniors so they could continue “tax breaks for those earning over $200,000 and special interest subsidies for oil companies.”   Rarely have we seen a potential campaign attack register so powerfully.

What all these plans share is a health care cost shift from the government to seniors.  Could any idea be so mad?   That is the responsible position in the elite debate, and again, we side with the middle class.  These changes to Medicare would be a crushing blow to the middle class and we flat-out oppose them.

James  Why does everyone talk about cutting Medicare and not cutting overall cost of health care?  It’s in the middle class’s interests to get the cost of health care down, which is what affects them.

The health care lobby is interested in keeping the costs artificially high, which is the biggest driver of long-term structural deficits, and the government’s priority has been to talk about cutting Social Security so they can cut taxes.  As usual, the middle class comes last.  It seems like the consensus in Washington is that to show strength, you take on the middle class rather than taking on the health care lobby, which is a messed-up sense of priorities.  Surely it’s smarter to go after the health care costs themselves, not the people bearing the brunt of the costs.

Personally, I have problems with raising the age for Medicare, because, for one, it doesn’t reduce health care costs by itself at all.  Secondly, it might not even reduce health care costs to the government, because some people will just put off the procedures they need until they become Medicare-eligible.   The lower half of the population from an economic standpoint also tends to be much sicker than the upper half, which clobbers them further.

And again I return to my point that reducing costs will have a dramatic effect on the amount the government spends on health care.  To illustrate, the government of Canada spends a lower percentage of its GDP on health care than the government of the United States.  Think about that for a second.   The government of Canada provides 99 percent of the health care in the country where we have every kind of market.  Obviously, they have found a way to reduce the overall cost and increase the total coverage.

The most important damn thing in the campaign ahead is to defeat these “Medicare reforms” as Social Security privatization was defeated at the outset of George Bush’s second term.   The presidential election should center on it–and every Republican incumbent should face the wrath of the voter on the votes they cast.  Only then can we get on with the real job of reducing the country’s health care costs.

Renegotiating Terms – James  It seems at the writing of this book that the consensus among pundits is that President Obama will be reelected in November 2012.  If the collective wisdom of the pundits is correct (relying on it is always a risky proposition), then we know what President Obama is going to do.  He is going to strike a bargain that is something along the lines of the Simpson-Bowles commission.  It was impossible to read Matt Bai’s New York Times Magazine piece in April 2012 and not walk away thinking that this is a man who really wants a big deal on the deficit and is willing to give up a lot along the way.

The terms of the surrender that the president was trying to negotiate with Speaker Boehner would have effectively given the Republican Party almost anything that they wanted, but because Boehner refused to accept the terms, we were left without a deal.  I fervently hope that we reelect President Obama so he can negotiate a deal much stronger than the one he capitulated on in August 2011.”

SOCIAL SECURITY: WHY NOT a BIPARTISAN COMMISSION to SECURE IT AGAIN? Stan   Social Security and Medicare are essential elements of middle-class life and survival.  After a lifetime of work, we have built up a system that allows most Americans to retire without falling into poverty and have the security of an assured monthly income and coverage for health care.  If you get retirement right for middle America, it will reverberate all the way down through the generations.  This is the one place where thanks are due to Franklin Roosevelt but also Dwight Eisenhower and Richard Nixon, who repeatedly increased Social Security payments and also indexed it to inflation, making sure Social Security today remains central to what it means to be middle-class in America.

We all know that Social Security can be put on a sustainable path without the drastic changes required for health care and Medicare.  Social Security is not in crisis.  But the gap between the elite debate and the public debate could not be larger.  The former talk about “entitlement spending” (translation: “We can only achieve fiscal stability if we cut Social Security, Medicare and Medicaid”).  Well, in my entire life watching focus groups, I have never heard a human being use the word “entitlements.”  But when the debate mentions the real programs, they say “Hands off.”  They know these are the final critical pieces that make a middle-class life in America possible.

Elites should get it into their head that two-thirds of the country rejects this statement: “The federal deficit is such a national problem that we have to cut spending broadly, including possible future cuts to Social Security and Medicare spending.”  In other words, two-thirds just reject the legitimacy of this debate.  We conducted a series of polls for the Campaign for America’s Future in the summer of 2010 as the Simpson-Bowles commission was moving to its bold recommendations.  Near 70 percent said, literally, “Politicians should keep their hands off Social Security and Medicare,” adding, “The American people can’t afford cuts in these programs.”

As Simpson-Bowles and Domenici-Rivlin were recommending raising the retirement age and reducing benefits for some beneficiaries, our polls showed just a quarter of the public accepts that the deficit is such a national threat that we have to make major changes in entitlements.  When we describe the recommendations of the bipartisan commission to reduce the deficit by $4 trillion, only a third support it.  The problem we face is not gridlock; it is elites not getting how central this issue is to Americans.  This is not about the power of the AARP.

Again, the public will not join the elites unless Social Security is addressed on its own terms.

James  Why hasn’t there been a cry for a commission to secure Social Security?  We’ve done this before in a bipartisan way, so why not again?  The public is ready.  We’re ready as long as everything is devoted to Social Security, not something else the elites want to get done.

We are going to do whatever we need to do with Social Security within the context of Social Security.  We don’t advocate making changes to Social Security to address the deficit.  If you want to make changes in the cost of living or move the retirement age up, do it if it’s a good idea on its own merits, not because you’re trying to pay for something else.

We actually have no problem touching the third rail in American politics as long as the train is going on the track of Social Security and the last stop is maintaining benefits.  We don’t want to touch the third rail if people’s Social Security taxes are going to pay for rich people’s tax cuts or wars that don’t work.

I still don’t know why Al Gore’s lockbox wasn’t a great idea.  The press pundits picked at it, but doubters said, “Sounds like a reasonable idea to me.”  Lock up that money and make sure it’s only to protect Social Security.

Stan  The president and Congress should appoint a bipartisan commission as they did under President Ronald Reagan to make recommendations to secure Social Security.  It would be charged with securing the system and ensuring that benefit levels are consistent with the challenges facing most Americans today.

The report’s preface would conclude, “At no point since the beginning of Social Security has our country faced successive generations of Americans more on their own and dependent on the system.”  Three decades of slumping incomes and fewer jobs with retirement plans–along with lowered home values and lost savings and wealth as a result of the recent crisis–have made Social Security the primary income for a growing majority in retirement.  With growing integration with China and India and advances in information technology, wages will likely be under pressure for a long time.  The need to get Social Security right will not diminish.

James  Unless the country listened to Carville and Greenberg and acted to restore the middle class.  If you can get middle-class incomes up and rewarded work again, this wouldn’t be so critical.

Stan  In that context, the commission’s focus should be on maintaining benefit levels in this new world.  This is the one place where America has the legal structures, precedents, ability, and the public support to make a long-term difference for the middle class.  We should not fail to act.

Most of the elites’ work to “save” Social Security begins with reducing benefits.  That is not where the rest of the country begins.

A large majority of the public–often approaching two-thirds–opposes any proposal for reform that reduces the benefits people receive in retirement.  For the public, the purpose of “reform” is to maintain if not increase benefits.

When you propose to reduce future benefits for those entering the labor force now–by 17 percent for those whose salaries average $43,000 and by about one-third for those who average over $100,,000, as in Simpson-Bowles–60 percent of those under 50 years of age, including those under 30, oppose it.  After all, these are policies that would diminish their own retirement prospects.  They will casually comment to reporters and our focus group moderators that “Social Security won’t be there when I retire,” but as we see in practice, they are damn certain to make sure Social Security maintains its benefit levels when they get there.

Critics say that young people don’t expect it.  They are wrong, but it does not matter.  We are opposed to reducing the benefit level–especially given what is happening to wages and retirement plans for the younger generations.

Nearly as large a majority opposes proposals to gradually raise the retirement age from 67 to 69 years, though opposition may have dipped down in public polls.

Stan  I could be convinced to support that shift, as it reflects real-life changes in work and life expectancy, and people have accepted the current slow rise in the retirement age.

James  Why do we have to raise the retirement age by a full year?  Can’t we raise it three months?  If you’re a hotel maid, three months is a lot less than a year.

Stan  One thing the bipartisan commissions and the public agree on is the need to raise the amount of wages subject to the payroll tax, currently capped at $106,800.  When the cap was first introduced, 90 percent of all wages were taxed and then indexed to inflation, helping make this all more sustainable.  That should be done again, and three in five votes favor this proposal.

If it were up to me, I would advocate an increase in Social Security benefits, given what has happened to incomes and retirement.  Senator Tom Harkin’s Rebuild America Act would increase retirement plans on average by 15 percent, about $65 a month and $800 a year.   I’m pretty confident the public would support it, but amazingly, the elite debate is so dominant that no pollster, including myself, has even asked about support for increased benefits.

James   You and I do have slight differences.  You’d be willing to somewhat raise benefits and I’d be less enthusiastic about that because we wouldn’t be credible.  But I’m very enthusiastic about protecting the benefits we already have.  Again, as long as we are talking about it, we’re moving forward.

So I’m in favor of whatever cost-of-living formula best reflects the rising prices facing seniors.  to be honest, you are for whichever formula gives seniors more money.

But what we both care about most is changing the elite presumption on entitlements and Social Security.  America should be protecting benefits to reflect what has happened in the labor market and economy over the last three decades.  We hope this chapter is a shot across the bow that gets the country thinking about what we really have to do.”

(THIS IS REALLY A GOOD TWO-PART CHAPTER TELLING JUST EXACTLY WHY WE MUST KEEP SOCIAL SECURITY STRONG AND BUILD ON IT AND NOT WEAKEN IT LIKE SOME OF THE REPUBLICANS IN CONGRESS WANT TO DO, STARTING WITH GEORGE W BUSH, WHO WANTED TO PRIVATIZE SOCIAL SECURITY, WHICH WOULD VIRTUALLY MAKE IT WORTHLESS BUT HIS WORTHLESS IDEA WAS DEFEATED IN CONGRESS, WITH HELP FROM BOTH PARTIES BUT NOW THAT REPUBLICAN DONALD TRUMP HAS BECOME PRESIDENT, LOOK FOR THE PROBLEM TO GET CONSIDERABLY WORSE SINCE HE WANTS TO LOWER THE FEDERAL INCOME TAXES FOR THE WEALTHY INDIVIDUALS AND BIG CORPORATIONS.  AND PAY FOR IT BY SLOWLY WEAKENING SOCIAL SECURITY AND MEDICARE TO THE POINT THAT, DOWN THE ROAD, IT WILL BE VIRTUALLY WORTHLESS.  THAT’S SOMETHING THAT MUST NEVER HAPPEN BECAUSE WHEN DEMOCRAT PRESIDENT FRANKLIN ROOSEVELT STARTED IT, HE SAID IT WOULD BE AROUND FOREVER BECAUSE GETTING OLD SHOULD NOT BE CONSIDERED A SIN.  IT’S JUST A PART OF LIFE AND OLDER PEOPLE MUST BE TAKEN CARE OF.

LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veterans

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The Elite Consensus on Entitlements and Deficits

The following is an excellent excerpt from the book “IT’S THE MIDDLE CLASS, STUPID!” by James Carville and Stan Greenberg from Chapter 15: “The Elite Consensus on Entitlements and Deficits” on page 219 and I quote: “Stan  We have a rule for judging which problems the country should address.  Is it good for the middle class or not?  Actually, in my family, it was “Is it good for the Jews?”

If it makes it harder for those people on the edge, we don’t accept the priority, the economics, the politics, or the morality of it.  And so we are likely to begin in a contrarian position to what many think is the biggest problem facing the country: the federal deficit.

We accept that reducing the deficit is extremely important, and both of us have a history with President Clinton of supporting a deficit reduction plan that contributed to the low long-term interest rates and rapid employment and income growth of the late nineties.

James  Right.  We’re the first to acknowledge that high deficits over a long period would have an adverse effect on the middle.  We have to pay interest: it crowds out spending when demand returns to the economy.  We know this because we come to this argument with a history of having supported the most successful package of deficit reductions that’s ever been passed, with an assist to President Bush 41 and his 1990 deal with tax increases, which Democrats helped him pass.

Based on our own surveys and analysis, we have both urged Democrats to acknowledge the need for long-term deficit reduction.  For the ordinary citizen, reducing private and public debt is part of getting to a good economy.  But that was before we wrote this book and came to our current preoccupation.  And by the way, voters, too, have soured on Republican messages focused exclusively on spending cuts, deficits, and big government.  That’s no longer good enough.

Again, we take the deficit seriously and much of what we propose–from increased tax revenues to reduced health care spending–will indeed reduce the deficit in dramatic ways–but we take the fate of the middle class even more seriously.  We just can’t live with the prevailing wisdom of the deficit reduction plans on two of its most important recommendations: entitlement spending and reducing government’s Medicare spending.  These are hardly quibbles, which is why we wanted to get them out up front.

We have our plan for the middle class.  As we saw earlier, it begins with getting money out of politics, because that turns what’s possible upside down.  But after that, our biggest accomplishment would be to fundamentally challenge the rush to cut middle-class entitlements.  Our goal is to defend and maintain Social Security benefits and reduce total health care costs.

Let’s start by asking, “What is the problem the country needs to address?”

A pretty big swath of the political class–from The Moment of Truth, by the National Commission on Fiscal Responsibility and Reform, chaired by Senator Alan Simpson and Erskine Bowles, to Restoring America’s Future: Reviving the Economy, Cutting Spending and Debt, and Creating a Simple, Pro-Growth Tax System by the Debt Reduction Task Force , chaired by Senator Pete Domenici and Dr. Alice Rivlin; from the American Enterprise Institute to the Heritage Foundation; from Budget chair Paul Ryan to Republican presidential candidate Mitt Romney; from the Washington Post to the Wall Street Journal editorial board–ways the biggest problem facing the country is the growing deficit, driven above all by unsustainable entitlement spending.  All of the reports begin with the urgency and stakes, starting with Simpson-Bowles:

“Without regard to party, we have a patriotic duty to keep the promise of America to give our children and grandchildren a better life.

“Federal debt this high is unsustainable.  It will drive up interest rates for all borrowers–businesses and individuals–and curtail economic growth by crowding out private investment.”  If the deficit were not tackled boldly, “each American’s share of the nation’s economy” would be reduced by 15 percent by 2035.”

The Domenici and Rivlin report for the Bipartisan Policy Center begins with a like urgency: “The federal deficit is on a dangerous unsustainable path.”  Failure to act will “push interest rates up, endanger our prosperity, and make us increasingly vulnerable to the dictates of our creditors.”  They cite Federal Reserve chairman Ben Bernanke’s statement of the “real and growing” risk and Joint Chiefs of Staff chairman Mike Mullen, who says this is “the single biggest threat to our national security.”

The conservative think tanks embrace the shared conclusion on the primary problem: “We face a staggering fiscal problem that threatens the very future of our nation.  Not only will we continue to struggle with huge federal deficits into the near future, but the problem will become larger and ever deadlier in the decades to come.”  That allows them to champion slashing government as the route to saving the middle class.  “Unless we act wisely, massive government spending and surging public debt will destroy the foundation of our economy and darken the American dream for our children and grandchildren.

Some of those who have embraced the problem and reports have given equal weight to other problems and national priorities.  To be fair, Tom Friedman puts the growing debt alongside global warming and other challenges.  And we recognize that the two major bipartisan reports have bravely protected the fragile economic recovery as they have advanced proposals for long-term deficit reduction.   With Republican support, they have challenged conservative orthodoxy on imposing a Europe-like austerity.  Domenici and Rivlin in particular say, “First, we must recover from the deep recession that has thrown millions out of work, slashed home values, and closed businesses across the country.”

These bipartisan reports have been crystal clear on the need to raise taxes and revenue.  Be sure, this goes against the Republican Party line and we do not underestimate the heat they must have taken for proposing any new revenue.

So we are respectful, but respectfully disagree–and strongly.  So, let’s lay that out why.

First, we share the frustration of ordinary Americans who will ask, Where is your plan for growing incomes and jobs?  You delay immediate cuts to allow for a recovery from the economic crisis, but how do you address America’s long-term growth?   This is the very reason why voters were cynical about stimulus spending.  They want the political and economic leaders to be focused on the long-term problems that they understand all too well.

Second, we challenge the underlying premise for many of these bipartisan efforts–that all have to “throw some skin in the game.”   We have all created the problem and we all have to give up something to get to a big solution.

In a valiant but not very successful effort to get the Republicans in Congress to agree to a long-term deficit reduction package, President Obama offered to give up things that he thought important, including aid to the poor in the form of the Community Services Block Grants and the Low-Income Home Energy Assistance Program:

“Simply put, it will take a balanced approach, shared sacrifice, and a willingness to make unpopular choices on all our parts.  That means spending less on domestic programs.  It means spending less on defense programs.  It means reforming programs like Medicare to reduce costs and strengthen the program for future generations.  And it means taking on the tax code, and cutting out certain tax breaks and deductions for the wealthiest Americans.”

Editorial and op-ed writers underscore the premise: “To regain our future,, we are going to have to all participate in shared sacrifice” (National Journal); “Everyone is pointing fingers at each other: Republicans blame Democrats and vice versa.  Business people blame politicians.  But the reality is that it will take everyone to sacrifice and to work together to solve the nation’s economic problems” (Washington Post).

Senator Alan Simpson, co-chair of the Simpson-Bowles commission, is blunt and to the point:    “But you have to–it has to be self-sacrifice and know that this country is going broke.”

Count us out.  The way we see it, the middle class has been sacrificing over these three decades, and they are in trouble.  The starting point for any deficit reduction plan is that the top earners in the country have to pay the lion’s share of any change in our budgeting, spending and taxing.  That is our premise and principle.

James  Let me say something about “shared sacrifice.  When I hear that phrase, what I’m really hearing is certain people saying, “This is another opportunity to whack the middle class.”   Of course there is going to be some sort of sacrifice: the middle class has always been willing to do its part for the country; it’s absurd to think that they don’t.    But Paul Ryan’s idea of shared sacrifice is that the middle class gets to sacrifice and the rich get to share the money.

Plenty of people have been profiting mightily, benefiting from the rigged system, and ripping off the country: the oil and coal conglomerates with their subsidies; the hedge fund managers with their carried interest; the top 2 percent with their Bush-era tax cut bonanzas; the private contractors in Iraq with their cost overruns and crony contracts; the big farmers with their subsidies.  I’m the biggest guy there is for shared sacrifice if its sacrifice and it’s shared.

We need to be sure that people who have made more than their share of sacrifices over the past 30 years see those who’ve made none ahead of them in line.   If you tell anyone in the middle class that we have to strengthen Social Security or reduce health care costs and there might be some inconveniences attached, they’ve been there.  They know.

I mean, it’s not as if the middle class has been running wild at a huge party for thirty years.    Not the case.  Just look back at some of the charts we’ve published here–hourly wages and hours worked and income growth, the middle class versus the one percent–and tell me who’s been sacrificing and who’s been “sharing.”

Stan  What the commission heads are really saying is: we will put our special interests on the block if you will do the same.  Senator Alan Simpson is at least honest about the necessity of taking on the interests and “sacred cows,” as he described it to Fareed Zakaria on his CNN show GPS.

“You have to go deal with Medicare, Medicaid, the solvency of Social Security and defense.  And if you can’t raise the retirement age to 68 by the year 2050 without the AARP losing their marbles and Grover [Norquist] slavering at the mouth on every kind of thing you talk about, calling it a tax increase, we won’t make it.”

Alan Simpson offers equal bipartisan disdain for the antitax conservative groups and the AARP.  “We had the greatest generation,” but now “I think this is the greediest generation.”

James  This is what I would say to Mr. Simpson.  If you milk one sacred cow, you’ll find it’s full of milk, because it’s been building up in there for thirty years.  The other sacred cow, you may want to milk it, but there ain’t much milk left.  The notion that more than one sacred cow has as much milk as the first, with all due deference, I’m not buying it.”

(TO KEEP THE MIDDLE CLASS SOUND FINANCIALLY, WE HAVE TO HAVE A RETIREMENT PROGRAM FOR THEM AND THAT’S HOW SOCIAL SECURITY GOT STARTED UNDER DEMOCRAT PRESIDENT FRANKLIN ROOSEVELT SO OUR SENIOR CITIZENS WOULD HAVE A MONTHLY INCOME AND WOULDN’T HAVE TO VIRTUALLY HAVE TO GO OFF AND DIE PENNILESS LIKE A LOT OF PEOPLE DO IN THIRD-WORLD COUNTRIES.  THAT’S WHY IF ANY REPUBLICAN PRESIDENT WOULD EVER TRY TO GET YOU TO PRIVATIZE SOCIAL SECURITY LIKE REPUBLICAN PRESIDENT GEORGE W. BUSH ATTEMPTED TO DO AND FAILED.  SO WITH THAT IN MIND, YOU CAN REST ASSURED THAT THE REPUBLICANS WILL TRY IT AGAIN LIKE REPUBLICAN PRESIDENT DONALD TRUMP IS ATTEMPTING TO DO IN HIS SO-CALLED NEW FEDERAL INCOME TAX PLAN WHERE IT LOWERS THE FEDERAL INCOME TAX FOR WEALTHY INDIVIDUALS AND BIG CORPORATIONS.  HOPEFULLY, THE REPUBLICANS IN OFFICE, GET A LOT OF PHONE CALLS AND REALIZE THAT PUTTING OUR COUNTRY FURTHER IN DEBT IS NOT WHAT THE SO-CALLED CONSERVATIVE REPUBLICAN PARTY IS SUPPOSED TO DO.

LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veteran

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The Disaster of 2010

The following is an excellent excerpt from the book “IT’S THE MIDDLE CLASS, STUPID!” by James Carville and Stan Greenberg from Chapter 11: “The Disaster of 2010” on page 166 which took place after the 2010 election in President Barack Obama’s first term and I quote: “Stan  The 2010 debacle took place at a time when big majorities in the country strongly agreed that America was in decline, that our problems had been building for years, and that special-interest money and lobbyists had government by the throat, catering to CEOs and Wall Street while the rule-abiding middle class was sinking.  Even more, they strongly believed America needed a “clear strategy” and a government that “works for the middle class.”  Yet the Democrats did not make the election about any of that–only a metaphor about blame and progress.  It was bloody.

After the election and for a good part of the next year, the president was much more cautious about trumpeting good economic news and telling people that things were getting better for them.  Still, the economic story remained rooted in the crisis.  It was an administration that acted to keep the country from facing a deep depression and to prepare Americans for the “tough, long journey” ahead, with people “understandably impatient.”   There were “strong headwinds” that lengthened the journey and required we do more.  The assumption, articulated by the president himself, was that at some point on the journey, people would see results, look back, and credit him for getting them through the crisis:

“Well, what I would say is that for the last two and a half to three years, we have been working tirelessly and nonstop to deal with the worst economic crisis of our lifetimes, and ultimately, I’m going to be judged by, you know, whether we have stayed focused on making sure that this economy is moving in the right direction. . . . [M]y hope is that when we’re on the other side of it, folks will look back and say, you know, he wasn’t a bad captain of the ship. . . . [T]his country always get through these storms.”

But that was a tall order for voters living with downsized jobs, diminishing incomes, and rising costs for health care and gasoline.  it invited them to shout back, “What kind of job?”  And it required the president to jump on each sign of progress, making the White House look out of touch along the way.  It left us all captive to events.  We were asking voters to look back at events of more than four years ago and vote for continuity in what will certainly be another change election.

We came to the counterintuitive conclusion that Democrats must forget about the past and the financial crisis and recognize that “the story is not the recovery, but a set of powerful on-going realities: a middle class smashed and struggling, American jobs being lost, the country and people in debt, and the nexus of big money and power that leaves the common people excluded.”  The story was the middle class.

Faced with a Republican-controlled House and a reduced majority in the Senate after the midterm elections, the president was determined to reach a bipartisan deal that would advance the interests of the country.  He made a big offer to reduce the deficit by $4 trillion and even put Medicare in the mix.  He appealed for an end to the blame game in Washington and acknowledged “neither party is blameless for the decisions that led to this problem, [and] both parties have a responsibility to solve it.”   He identified with Americans who are “fed up with a town where compromise has become a dirty word.”  While people are struggling to “put food on the table,” they turn on the TV and “all they see is the same partisan three-ring circus here in Washington.

This appeal was grounded authentically in the president’s personal project to bring people together, seek pragmatic solutions, and overcome partisan and ideological polarization.   That was the horse that got him here, and voters for sure were angry about the partisan bickering that made Washington dysfunctional.  That was one of the biggest reasons people said they punished Democrats in 2010, and maybe it is one of the biggest reasons they will punish Republicans at the next opportunity, in 2012.

And that’s a story: a president reaching out his hand and offering to compromise the programs dearest to his heart, including help for the poor, in pursuit of a bold bipartisan deal to make progress on the out-of-control deficit and the country’s biggest problems.  In his private negotiations with the Speaker, he accepted significant changes to Medicare and Medicaid, including raising the eligibility age to 69, and to Social Security cost-of-living changes that would reduce monthly benefits.  He chided Washington, the Congress, and even his own party to do the right thing for the country.  With the nation on the brink of defaulting on its debts in the summer of 2011, the president had a story to tell about a dysfunctional Washington and how he offered a better future.

James  The road to hell truly is paved with good intentions.  This is not our grandmothers’ Republican Party.  They are swearing faith in absolutes and any wavering or dealing with the devil is treated as heresy.   The Republicans were never going to cut any kind of deal that made Obama look good, or capable, and certainly not statesmanlike.  Obama was chasing a grand bargain on the Republicans’ terms.  They were trying to deal with the deficit that had largely been caused by Republican tax cuts by cutting Medicare and Social Security.

According to Matt Bai, John Boehner was prepared to accept revenue increases in return for cuts in entitlement programs, but there was no way he could get past Eric Cantor, who represented the majority of the party, which would never accede to anything that looked or smelled like a tax increase.  If the grand bargain had been struck between Boehner and Obama, both men would have had trouble in their parties, but the Republicans walked away.

The battle with the House Republicans over raising the debt ceiling ended in tears: both the president and the Republicans were hurt dramatically.  The latter took most of the blame, but with the president not blaming them for this downgrading of the American economy, he looked “overwhelmed” and “not strong enough” to help people.

But that has totally changed.  The president points out Republican intransigence and madness every day, and Republicans are on the defensive and paying a big political price.  That sets the stage for a very different story.

When All Is Said and Done, There’s a Lot Better Chance the Middle Class Will See Better Times When a Democrat Is President James  In my last, prescient book 40 More Years, I was proud to say that I had been praised by eminent academic Larry Bartels for stating that the American economy does better under a Democrat in the White House than it does when there is a Republican president.  Professor Bartels is now at Vanderbilt University; he was at Princeton then, but from whatever vantage point he sees me, I’m still right.   And so was Harry Truman when he said, “If you want to live like a Republican, you have to vote like a Democrat.”

Information in Larry’s 2008 book Unequal Democracy shows how much better the economy has performed under Democrats.  For our purposes, it’s stunning how much better the lower-middle and middle class has done in income growth.  Unemployment and economic growth are better too.  Between 1948 and 2001, the great middle–stretching from the 20th to the 80th percentile–saw annual real income grow between 2.37 and 2.63 percent when a Democrat was president.  It looked much different under Republican presidents: in the bottom 20th percentile it grew 0.6 percent; in the 40th it grew 0.93 percent; in the 69th it grew 1.32 percent; and at the top, from the 80th percentile up, annual real income grew 1.6 percent.  All lower.  Under Democratic presidents, unemployment was about one-third lower, and GDP growth about one-third higher, than under Republicans.  And inflation is a wash. . . but aren’t Democrats supposed to let spending, the money supply, and everything else get out of control?

Think about the job situation.  I don’t believe George W. Bush created a single private-sector job in his eight years in office. In his first term he lost 913,000 private-sector jobs, where as Obama was heading into positive territory by March 2012.  Obama was hit by public-sector job losses–in state and local government–while Bush oversaw big gains in government jobs, ironically enough.

There’s another indicator that shows how much better off we are with a Democrat as president.  If you had put $1,000 in a fund that followed the S&P index when Democrats were in power since Kennedy, you’d have had $10,920 in early 2012.  For Republicans from Nixon through Bush, the figure was $2,087.  With the Democratic fund, you’d have done nine times better!  Fellow Democrats, I urge you to tear out this page and keep it on your person, so if you run into Larry Kudlow in a social situation somewhere, you can take this page and stick it in his–uh, you can show it to him to politely.

Let’s say you have a Democrat fund and your capital gain is $9,920.  In a well-ordered society, you would pay 35 percent capital gains tax on that money, leaving you with $6,448 and the U.S. Treasury with $3,472.  With a Republican fund, the gain is $1,087, but you pay no tax in your trickle-down world.  You get $1,087, and Uncle Sam gets zip.  It’s easy to see that both the investor and the country are better off with a Democrat; under a Republican, the investor is poorer and the country is poorer.  What is there to think about?”

(DEMOCRAT PRESIDENT OBAMA GOT ELECTED TO PRESIDENT IN 2008 AND TOOK OVER AFTER REPUBLICAN GEORGE W. BUSH RAN OUR ECONOMY INTO A FINANCIAL DITCH WHERE HE ACTUALLY BANKRUPTED OUT BANKING SYSTEM AND IT HAD TO GET BAILED OUT WITH HELP FORM THE DEMOCRATIC PARTY WHICH WAS KNOWN AS THE $700 BILLION TARP BANK BAILOUT BILL.  PRES OBAMA GRADUALLY WORKED OUT ECONOMY BACK TO A NORMALCY BUT IT TOOK BOTH HIS TERMS –FIRST AND SECOND–TO DO SO AND GOT OUR MIDDLE CLASS BACK TO NORMAL AGAIN.  IT’S INTERESTING TO READ HISTORY AND HOW DEMOCRATS ARE MORE CONSERVATIVE IN THE LONG RUN AND WILL DO MORE FOR THE WORKING CLASS THAN REPUBLICANS WILL WHO JUST SEEM TO WANT TO BENEFIT THE ELITIST 1%.  THAT ALL STARTED BACK YEARS AGO, AFTER DEMOCRAT FRANKLIN DELANO ROOSEVELT BECAME PRESIDENT IN 1933 AFTER THREE FAILED REPUBLICAN ADMINISTRATIONS IN A ROW–HARDING, COOLIDGE AND HOOVER.  DEMOCRAT PRESIDENT FRANKLIN ROOSEVELT HAD A FEDERAL INCOME TAX RATE AS HIGH AS 90% DURING AND AFTER WORLD WAR II.

LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veteran

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Washington Examiner: What If George W. Bush’s Social Security Reforms Had Passed?

The following is an excellent article written by Jason Russell on the Washington Examiner website on August 13, 2015 titled “What If George W. Bush’s Social Security Reforms Had Passed?” and I quote:

“What if George W. Bush’s Social Security reforms had passed?”

More than a decade ago, President George W. Bush set out to fix what he called a broken Social Security system. In 2001, intermediate projections had shown the retirement trust fund would be exhausted in 2040. By 2005, finances had improved and the projected exhaustion date was 2043. But today, exhaustion looms closer, only two decades away in 2035.

Bush wanted to modernize Social Security and ensure its fiscal integrity, but without raising taxes cutting benefits for current or near-retirees, or investing Social Security funds directly in the stock market. To achieve this goal, Bush convened a bipartisan Commission to Strengthen Social Security.

The commission recommended three different reform plans, each of which established a system of voluntary personal accounts. “Personal accounts improve retirement security by facilitating wealth creation and providing participants with assets that they own and that can be inherited, rather than providing only claims to benefits that remain subject to political negotiation,” the commission’s final report said. “By allowing investment choice, individuals would be free to pursue higher expected rates of return on their Social Security contributions.”

None of the reform plans went anywhere in Congress. But what if they had?

Current retirees and those near retirement today would have seen little change, if any. “Current retirees would not have been affected,” Thomas Saving, a member of the commission and a Social Security public trustee at the time, told the Washington Examiner. “Nobody wants to affect current retired people or people who are about to be retired.” Even if reforms had been passed in 2002, changes for people retiring in 2015 would have been minimal.

Despite the Great Recession, advocates of the Bush reform say the system would have survived well.

Andrew Biggs, now a resident scholar at the conservative American Enterprise Institute, worked on the staff of the commission. “There were a couple of provisions in the Bush plan that would have shielded you from most of the downside of the recent stock market declines,” Biggs told the Examiner. “People who were retiring today would have been mostly in bonds during those years so they would not have been subject to the big stock market declines.”

Given the proposed gradual implementation of the Bush reforms, the system’s finances would mostly be the same as they are today. However, its projections would be much better had the reforms passed in Bush’s presidency. “When we look at the 75 year projections of how solvent the system is, or when the trust fund will run out, those numbers would have looked substantially better,” Biggs said.

While Congress considers how to protect Social Security’s future, a fight looms over whether to expand or shrink the program. “Most of the Democrats in the Senate now favor expanding Social Security without figuring out how to pay for it,” Biggs said. Republicans haven’t signaled what they want to do about Social Security, but they recognize some kind of long-term reform is necessary.

Jared Bernstein, a senior fellow at the liberal Center on Budget and Policy Priorities, predicts a compromise of higher taxes combined with trimmed benefits. “We must close the solvency gap,” Bernstein told the Examiner. “There’s a large menu of ideas to do that, and they all come down to raising taxes or lowering benefits. You can cut it anyway you like, but I think in a world where there’s considerable political division you’re surely going to have to do both of those.”

Raising taxes could mean raising, or eliminating, the $118,500 salary cap on income subject to payroll taxes. Trimming benefits could mean some form of means-testing through adjustment of the benefits formula. “Most of the benefits go to middle and low income people, and we don’t want to cut their benefits,” Bernstein said.

Today, it seems as if the time has passed for the idea of voluntary personal accounts in Social Security. Bernstein says any kind of privatization would be “ill-advised,” because it would be “a very stark departure from the best aspects of Social Security,” referring to the certainty of fixed benefits that don’t depend on the stock market.

Biggs said he supports the general principles of the Bush proposals, and that many people still think the reforms are a good idea. Still, he wouldn’t propose the exact same provisions today.

Saving believes the reforms would still be beneficial today, but it was a missed opportunity to not have passed the Bush reforms in the 2000s.

“This is a very different world, because you have 10,000 baby boomers retiring every day,” Saving said. “We were looking at this at a time when these guys were all at the peak of their earning.”

A voluntary private accounts system would be “much superior in the long run than what we have, because it’s not a generation transfer system, so it no longer has all these uncertainties,” Saving added. There will always be economic risks, but a voluntary private accounts system wouldn’t have the demographic risks of the current Social Security model.

Either way, some kind of reform is necessary, as soon as possible.

“Social Security is in kind of a depressing period now because we’ve delayed and delayed and delayed on fixing the system, the program’s finances have gotten worse, the disability program is about to go broke, and most of the folks on the progressive side basically just want to paper over the problem. … This is not a particularly happy time in terms of Social Security reform,” Biggs said.”

(IT WOULD HAVE BEEN A TOTAL DISASTER IF REPUBLICAN PRESIDENT GEORGE W. BUSH’S SOCIAL SECURITY REFORMS WOULD HAVE PASSED WHICH WOULD HAVE EVENTUALLY GOTTEN RID OF SOCIAL SECURITY FOR AT LEAST THREE-QUARTERS OF THE PEOPLE WHO WOULDN’T HAVE BEEN ABLE TO AFFORD ANY KIND OF RETIREMENT PROGRAM OR HEALTHCARE AND THEY WOULD HAVE TO DIE ON THE STREETS LIKE THEY DO IN THIRD-WORLD COUNTRIES WHICH, WHEN I SEE IT ON TV IS A REAL TRAGEDY.

LaVern Isely, Progressive, Overtaxed, Independent Middle Class Taxpayer and Public Citizen Member and USAF Veteran

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