Monthly Archives: June 2011

Read My Lips: No New Taxes

I wonder what George Bush the Senior thinks about the current kerfuffle Inside the Beltway over hiking the debt ceiling and the federal budget. Prez O said yesterday during his presser that additional revenue — tax increases and the elimination of certain corporate benefits — had to be part of any debt-reduction package. The Republicans said about taxes: no way.

Kind of an interesting policy and political debate with both parties heading in opposite directions.

And many of the newly elected conservative members of Congress got their tickets punched by voters back home by pledging not to raise taxes, if not cut them along with reduced government spending across the board.

George Bush the Senior as he launched his bid for the White House issued the great TV sound bite: “Read my lips, no new taxes.

Alas, he caved — and became a one-term president.

Here’s from the NYT article “In Deficit Plan, Taxes Must Rise, President Warns“:

President Obama pressured Republicans on Wednesday to accept higher taxes as part of any plan to pare down the federal deficit, bluntly telling lawmakers that they “need to do their job” and strike a deal before the United States risks defaulting on its debt.

Declaring that an agreement is not possible without painful steps on both sides, Mr. Obama said that his party had already accepted the need for substantial spending cuts in programs it had long championed, and that Republicans must agree to end tax breaks for oil and gas companies, hedge funds and other corporate interests.

In a 67-minute news conference, Mr. Obama cast the budget battle as a tug of war between the interests of the rich — like owners of corporate jets, who he said get generous tax breaks — and those of the middle class, the elderly and children.

Directly challenging Republican leaders, Mr. Obama said, “Everybody else has been willing to move off their maximalist position — they need to do the same.”

At the same time, Mr. Obama, under assault frfom Republicans on the campaign trail for an unemployment rate that remains above 9 percent, asked voters to understand that the economic recovery would take time but said that Washington, even in its current financial straits, could still do more to help. He expressed support for extending a reduction in payroll taxes for an extra year, providing loans for road and bridge-building and approving trade pacts that could help spur exports.

While the president expressed hope for a budget deal before the government’s borrowing authority expires in early August, he scolded Republican lawmakers for putting off hard decisions until the 11th hour, saying that his daughters did not procrastinate that way with their schoolwork.

“Malia and Sasha generally finish their homework a day ahead of time,” the president said, in a tone of rising exasperation. “They don’t wait until the night before. They’re not pulling all-nighters.”

The House speaker, John A. Boehner, flatly rejected Mr. Obama’s call for new tax revenues, saying the “president’s remarks ignore legislative and economic reality.”

In a toughly worded statement, Mr. Boehner said the House would vote to raise the debt limit, as the White House has demanded, only if the administration agreed to a deal that contained deep spending cuts and no tax increases.

Oh, boy.

“Read my lips: no new taxes.”

We’ll see.

Aspen Ideas Festival: Big Thinkers and Policy Wonks

Gee. This is kind of embarrassing. I’ve been in Colorado for two weeks and I’ve been excluded from one of the big events: the Aspen Ideas Festival. Lloyd Grove, writing on The Daily Beast, describes the festival as “a week-long conclave of well-heeled do-gooders and big thinkers.”

Hey. I’m a go-gooder and big thinker. But I guess I’m not on the A-list (or apparently any list, other than possibly a shit-list). I guess there aren’t many invitations for pajama-clad citizen journalists. Sigh.

Anyway, I’ve been associated with a number of organizations Inside the Beltway for nearly 40 years. And I’ve always been somewhat amused at the premium that is placed on attending or speaking at seminars, meetings, policy briefings, conferences and so on. Maybe this is the business of the Beltway elites, advocates and policy wonks and helps explain why for this group at least D.C. is recession-proof.

It appears that the Aspen Ideas Festival is one of the big fish in the conference skillet. Here’s from Politico, “Aspen Festival: D.C.’s summer camp“:

For Washington’s A-list, it doesn’t get any better than this: seven summer days talking policy in the cushy and comely mountain town of Aspen, Colo.

And it’s not just the standard Washington policy discussions that dominate Beltway think tank symposiums: The Aspen Ideas Festival prides itself on digging deep into the issues — even the quirky ones.

While there is the standard fare of D.C. talkfests — “Making Democracy Work” with Supreme Court Justice Stephen Breyer or “America — the Great Debate” with White House economic adviser Austan Goolsbee — there are plenty of slightly off-kilter ones as well. Panel discussions at this year’s festival include “Hip Hop Deconstructed” and “Reality TV and Pop Culture.” One program even explores the idea and implications of “happiness.” And on one evening, you can catch such notables as Sandra Day O’Connor, John Negroponte and Zeke Emanuel dressed up in 16th-century garb for the evening performance, “All’s Well With Will: Shakespeare and Happiness.”

Think of it as summer camp for adults. And the sessions not only dominate the day but bleed into the night with events at the Belly Up music venue or the Hotel Jerome.

“By 11 p.m., the bar area at the Aspen Institute is just filled with everybody,” said institute CEO and President Walter Isaacson, whose organization sponsors the event along with its co-sponsor The Atlantic.

For Washington’s speaker circuit set, it’s one of the plushest gigs around — if you can get it.

OK. Sounds like fun stuff. And as long as nobody tries to act on any of the “big ideas” then it’s a case of “no blood, no foul.”

But apparently this year the Obama administration is using the festival as a way to strengthen some frayed relationships with former liberal supporters. Here’s from Grove’s Daily Beast article “Obama Woos Liberal Elite“:

If David Axelrod thought he was going to be love-bombed at the Aspen Ideas Festival—the week-long conclave of well-heeled do-gooders and big thinkers who, stylistically at least, would be expected to wish President Obama the very best—he had another think coming.

“This is a moderate crowd, both Republicans and Dems—you’re not looking at Tea Party Nation,” Time magazine columnist Joe Klein told Obama’s political guru on Tuesday evening during an onstage interview in the fashionable Colorado resort town. “And there’s a sense of disappointment here. They know he’s smart and trying hard. They wonder why he hasn’t been more forceful—why he hasn’t cut through.”

And more:

Klein, who was grilling his old friend Axelrod under the auspices of the festival’s organizers, the Aspen Institute think tank and the Atlantic Monthly magazine, was just being polite. In fact, some folks at the festival, who voted for Obama in the last election, aren’t just disappointed, they’re angry at him this time around, with the economy struggling, unemployment topping 9 percent and the president’s job approval ratings sliding week after week.

“I’m so mad, I want to kick his butt,” said nominal supporter Cynthia Brill, who was attending the panel discussions and earnest disquisitions  with her husband Steve, the journalist and high-tech entrepreneur. “They think everything is just fine—they don’t seem to know what’s going on.”

Outside of Axelrod’s hearing, Brill, a lawyer, told me that even before the outcome of the debt-limit negotiations is known, Obama has given up far too much in his back and forth with congressional Republicans over increasing the U.S. government’s ability to borrow money and prevent a market-shaking credit default. “He’s already lost the battle,” she claimed.

Cynthia, chill. You’re at summer camp.

And we’ll see who the winners and losers are when the people throughout the country who aren’t on the A-list start lining up at the voting booths.

Michele Bachmann: Are You A Flake?

Well, as Dutch Reagan might say: “There you go again.” I’ve opined previously that conservative women engaged in national politics are treated differently than men by the news media reporters and pundits, liberals — especially liberal women — and other miscreants.

Now Chris Wallace enters the fray.

Wallace, although he won’t admit it, is a conservative Talking Head on Fox News. He interviewed Michele Bachmann the other day and let this question define the interview: “Are you a flake?”

C’mon. I know. Journalists get paid to ask questions and on TV a lot of it has to do with ratings. But has Wallace asked that same question of a male candidate? Ron Paul, Mitt Romney, T Paw, Barack Obama and others — come on down.

OK. Wallace subsequently apologized and Bachmann accepted.

But Wallace has his supporters — at least from the standpoint of the legitimacy of asking the question in the first place.

Jonathan Capehart opines in WaPo, “Bachmann handled flake question just right“:

Let me cycle back to “Flake-gate” — sorry, Alexander — and the dust-up between Rep. Michele Bachmann (R-Minn.) and Chris Wallace. The “Fox News Sunday” anchor asked her bluntly, “Are you a flake? And while you would have used a less sexist adjective to describe the congresswoman, you know you would have asked some variation of that question if you were in his shoes. I know I would have.

Ah, why?

Capehart again:

The good folks at National Journal saved me a ton of work by putting out the “five things Michele Bachmann may want to un-say.” There’s the “gangster government” rap against President Obama. The Manchester mishap. Her call for “armed and dangerous” Minnesotans. The “bondage” of the “gay and lesbian lifestyle.” And the “slit our wrists” comment that I’d never heard before. Wallace himself ticked off a couple others in the lead-up to the offending “flake” question.

I don’t have to tell you that you have — the rap on you here in Washington is that you have a history of questionable statements, some would say gaffes, ranging from — talking about anti-America members of Congress — on this show — a couple of months ago, when you suggested that NATO airstrikes had killed up to 30,000 civilians.With a rhetorical track record like this, I don’t begrudge Wallace asking the question he did. Again, he should have put it a different way. But, you know what? I have to give Bachmann her due in how she handled it.

OK. And how did the congresswoman respond?

I would say is that I am 55 years old. I’ve been married 33 years. I’m not only a lawyer, I have a post doctorate degree in federal tax law from William and Mary. I work in serious scholarship and work in the United States federal tax court. My husband and I raised five kids. We’ve raised 23 foster children. We’ve applied ourselves to education reform. We started a charter school for at-risk kids. I’ve also been a state senator and a member of United States Congress for five years. I’ve been very active in our business. As a job creator, I understand job creation. But also I’ve been leading actively the movement in Washington, D.C., with those who are affiliated with fiscal reform.

I don’t know that I would vote for Michele Bachmann for president. But it strikes me that she is a serious candidate — and deserves serious consideration.

And remember: the best that the scribblers and Talking Heads can say about Sarah Palin, as they chase her around the country and hang on every word she says, is that she is stupid.

That strikes me as being kinda flaky.

Be Careful: Big Brother Watching

OK. In my dotage I’m either becoming more of a libertarian — or an asshat (maybe both). But here’s something that troubles me more than a little. It appears that the FCC has approved a firm that searches social media, compiles records on individuals, and then provides that information to organizations as part of background checks as people apply for jobs.

Oh, boy. And you thought George Orwell was a fiction writer.

Anyway, here’s from the story from The Daily Mail, “How everything you EVER said on the internet could be seen by employers as Feds approve firm that dishes dirt on applicants“:

The Federal Trade Commission has approved a controversial firm which scours social media sites to check on job applicants.

It means anything you’ve ever said in public on sites including Facebook, Twitter and even Craigslist could be seen by your would-be employer.

The Washington-based commission has ruled the firm, Social Intelligence Corporation, complies with the Fair Credit Reporting Act – even though it keeps the results of its searches on file for seven years.

It raises the frightening prospect of any social media posting, even it’s years old or was meant as a joke, being used in background checks.

Applicants who use online pseudonyms aren’t safe, either – the firm uses special software to link those nicknames with real, offline names known to employers.

One applicant found himself out of the running for a job after being branded racist because he once joined a Facebook group called ‘I shouldn’t have to press one for English. We are in the United States. Learn the language.’

Social Intelligence Corp scours everything from social networking sites, such as Facebook, to video and picture sharing websites as well as blogs and wikis.

I understand why potential employers do background checks — and realistically, almost nobody these days gives a negative reference in writing and even if asked during a phone interview.

Still, this idea of compiling records based on using social media — sort of a personal credit score based on what you show or tell — strikes me as creepy and an invasion of privacy. It’s not like Anthony Weiner. He elected to self-destruct.

But is there anyone at 18, 40 or 63 who hasn’t done or said something online these days that could potentially raise a red flag with employers? Fortunately, as best I can tell, Mother Teresa was not on Twitter. And remember that most human resources flunkies exist only to find reasons to reject applicants. For them, this will be a wet dream come true.

I guess the great American philosopher Sergeant Phil Esterhaus on Hill Street Blues has the proper perspective on this by opining: “Hey, let’s be careful out there.”

 

Afghanistan, War and Word Games

OK. I’ll admit it. I spent yesterday fly fishing with my son, Brian, high in the mountains in Colorado on an absolutely perfect day: bright sun, blue sky, temps in the high 60s and no humidity. In that environment, it’s tough to get your shorts in a knot over the issues — big and small, real and imagined — that I generally fret over.

Still, I watched Obama’s speech about withdrawing troops from Afghanistan. (Hey, by the time I sit down for my daily dose of Jameson because of the time difference it is already 7 or 8 p.m. in the East. If I lived here, I bet I would even be able to stay up late enough to watch Dancing With the Stars. I digress.)

As best I can tell, the Prez announced that he was sticking to the plan that he outlined previously. Good. But I would have liked to have seen us get the hell out of there sooner rather than later. We’ve done all we can in Afghanistan — thanks to the bravery and sacrifice of our men and women in the military. And no country — or group of invaders — ever wins in Afghanistan. Ask Russia.

And I recognize that not everyone agrees. Here’s from The Heritage Foundation, a conservative thank tank Inside the Beltway:

In the face of an unpopular war and an upcoming re-election campaign, President Barack Obama addressed the American people last night from the East Room of the White House to inform them of his plans to rapidly withdraw U.S. troops from Afghanistan. The President’s decision, though politically expedient, jeopardizes the successes made in Afghanistan over the last 10 months and will signal to allies and enemies alike that the United States is more committed to extricating itself from the fight than it is to ensuring that stability in the region is achieved.

The President’s decision to bring home 10,000 troops by the end of this year and a total of 33,000 troops by next summer comes despite requests from the Pentagon and General David Petraeus to limit the initial withdrawal to 3,000 to 4,000, as the L.A. Times reports. And as The Washington Postwrites this morning, the President’s decision isn’t based in a “convincing military or strategic rationale.” Rather, it is “at odds with the strategy adopted by NATO, which aims to turn over the war to the Afghan army by the end of 2014.”

Senator John McCain (R-AZ) also criticized the President’s decision to move for a rapid withdrawal, noting that “as our military commanders have repeatedly said, this progress remains fragile.”

Oh, boy. If we are going to wait until the situation in Afghanistan is not fragile, we’ll be there forever. Just sayin’.

So maybe Stephen Colbert has it right. He opines that we should end the Afghanistan war — by calling it something else. Here’s from a story on Mediaite:

Last night President Obama addressed the nation to clarify his latest plan to draw down troops from Afghanistan. And while Stephen Colbert taped his show before Obama’s speech, he still found a way to make some useful suggestions on how the White House could simply improve the nation’s foreign policy, focusing on the semantic opportunities provided by the War Powers Act. How best to end the war? Just change the name to something like a “heavily armed semester abroad.” Done!

The semantic gamesmanship was first raised by Secretary of Defense Robert Gates who recently defined US military operations in Libya as a “limited kinetic operation,” and not a war. So it only stands to reason that if our nation is openly admitting to playing with words (and meaning?) why not go all the way? Watch the clip, courtesy of Comedy Central.

“Heavily armed semester abroad.”

I kinda like that. At least it would allow us to win the word games that are being played over our involvement in Afghanistan, Libya and elsewhere.

 

 

Why Not Increase Social Security?

OK. I’m sitting here opining from a small town high in the mountains in Colorado. And I’m quasi-retired and fortunate: fixed corporate pension, vested 401(K) plan and when I want to start collecting it, Social Security.

Like many things in the U.S. these days, the rules relating to retirement are changing or have changed considerably, and not in the best interests of most individuals. Fixed private-sector pensions have been replaced — if they have been replaced at all — by plans that put the responsibility on individuals to save over the course of a working lifetime (investing in the stock market or pork futures or something) and then hope they have enough to live during the golden years. And now there is great enthusiasm to either reduce or eliminate pensions for public employees: teachers, firefighters, police and so on.

Saving for retirement during an era of high unemployment and underemployment, stagnant wages and pitiful investment options and returns ain’t easy. Consider that if you retire with $1 million in an IRA or similar account, at best you could count on $40,000 a year in withdrawals (give or take a couple thousand) with the expectation that you won’t outlive your money.

That leaves Social Security — which most public employees don’t receive at all and which I expect most people under age 50 have some big reservations about whether it will be available at all by the time they look to retire. It better be — or many are going to be working forever.

So while the Inside the Beltway crowd spin their wheels on how to “save” Social Security — which generally translates into reduced benefits and higher retirement ages — here’s an alternative perspective from Thomas Geoghegan, writing in the NYT, “Get Radical: Raise Social Security“:

AS a labor lawyer I cringe when Democrats talk of “saving” Social Security. We should not “save” it but raise it. Right now Social Security pays out 39 percent of the average worker’s preretirement earnings. While jaws may drop inside the Beltway, we could raise that to 50 percent. We’d still be near the bottom of the league of the world’s richest countries — but at least it would be a basement with some food and air. We have elderly people living on less than $10,000 a year. Is that what Democrats want to “save”?

“But we can’t afford it!” Oh, come on: We have a federal tax rate equal to nearly 15 percent of our G.D.P. — far below the take in most wealthy countries. Let’s wake up: the biggest crisis we face is that most of us have nothing meaningful saved for retirement. I know. I started my career wanting to be a pension lawyer. In the 1970s, lawyers like me expected there to be big pots of private pensions for hourly workers. By the 1980s, as factories closed, I was filing hopeless lawsuits to claw back bits and pieces of benefits. Now there are even fewer bits and pieces to get.

A recent Harris poll found that 34 percent of Americans have nothing saved for retirement — not even a hundred bucks. In this lost decade, that percentage is sure to go up. At retirement the lucky few with a 401(k) typically have $98,000. As an annuity that’s about $600 a month — not exactly an upper-middle-class lifestyle. It’s too late for Congress to come up with some new savings plan — a new I.R.A. that grows hair, or something. There’s no time. We have to improve the one public pension program in place. Should we means-test it? No. I don’t care if they go out and buy bottles of Jim Beam: let our elderly have an occasional night out at a restaurant.

The most paralyzing half-truth in this country is that people hate taxes. People are willing to pay taxes that they spend on themselves. Two-thirds of those surveyed in a CBS/New York Times poll in January were willing to pay more taxes to save Social Security at its modest level. To “save” it, most of us don’t need to pay. We could lift the cap on high earners, the 6 percent of workers who make over $106,800 a year. If earnings above the cap were subject to the payroll tax with no increase in benefits to high earners, there would be no deficit in the Social Security trust fund in 2037, as projected.

If people are willing to pay more just to “save” Social Security, they should be glad to pay more to raise it.

What does it take to get Social Security up to half the average worker’s earnings? According to the National Academy of Social Insurance, to close the deficit and raise benefits to nearly half of average worker earnings, we would need to find an additional 5 percent of taxable payroll, or find the money elsewhere. If we lift the cap on the payroll tax without paying more benefits to those above it, that gets us 2.32 percent (or a bit less if we slightly increase benefits to the rich). Dedicating revenues from the estate tax at its 2009 levels to Social Security gets another half percent. A few other tweaks, like covering new public employees, add another 0.42 percent. The remainder can be found by raising the payroll tax by roughly 1 percentage point for both employees and employers.

I can hear the argument: It will discourage jobs, blah, blah. While I sympathize with the health costs employers pay (I am an employer, at our tiny law firm), they have had a windfall on pensions. In 1975, when I left law school, around two-fifths of American workers were in defined-benefit plans. Now it’s just a fifth, and dropping. For employers, that’s not the real bonanza.

Retirees today are shortchanged on Social Security because they have been shortchanged on wages for their entire working lives. The labor economist Richard B. Freeman points out that the hourly earnings of workers dropped by 8 percent from 1973 to 2005 while productivity shot up 55 percent or more. The United States is one of the few developed countries where workers are routinely cheated of a share in higher productivity.

And where has the money from the extra productivity gone? It’s gone right to the top, to the top few percent. If wages had been paid fairly based on productivity, there would have been enough money subject to the payroll tax to avoid even a modest shortfall.

Of the big fish in the skillet — health care, Medicaid, Medicare — Social Security is the issue that can be fixed the most easily.

Whether it will be or not is debatable.

But for most who read this blog — and for millions of others who are pretty much on their on now when it comes to planning and saving for retirement, I’d be plenty worried about calls from both Republicans and Democrats in Congress and in the policy wonk think tanks Inside the Beltway to “save” Social Security.

Something to Write Home About: Snow in June

Well, I saw something this morning I’ve never seen before: snow in June. I’m vacationing in Breckenridge, Colorado, and as I got up this early a.m. to fire up my international media empire, I peeked out the window, and hey, where did the mountains go? All I could see was snow streaming past the window, covering the trees and roads.

Depending on which bartender you talk to — and I’ve surveyed a few in the interest of timely, accurate reporting since we’ve been here — Breckenridge had anywhere from 500 to 800 inches of snow last winter. And that’s good news for the skiers who flock here. But also good news for many others in Colorado who depend on the melting snow to provide water throughout much of the year.

And yesterday kind of reinforced my perception of a Colorado day. Sunny and warm enough at mid-day to trigger a mild sunburn while drinking beer outside on a patio. Then cold and snow at night, followed by warmer temps, blue sky and sun.

I was going to post something insightful today about the war in Libya — or not — and the GOP presidential hopefuls — or not.

But I found the snow much more interesting.

Just sayin’.