Month: December 2010

Dismantling The safety Net, One Program At A Time

by digby

Peter Orszag really has it in for the social security program. We already know that he’s selling the ridiculous idea that if the Democrats agree to cut social security they will be rewarded for doing it. Now he’s introducing the new image of the “disability queen” to weaken the program even more.

Evidently, there are a lot of people who qualify for SSI but have, until now, avoided applying for the problem because they were able to find some work. A lot of them have lost their jobs in this recession and are now applying. And Orszag is worried that this is bad for their character. You see, once in they lose all desire to work and will just hang around in the wheel chairs enjoying their leisure time instead of being the productive citizens they should be.

After granting that niggling little details like fixing the bad economy, creating millions of jobs and extending Unemployment Insurance need to done, he lets fly with this:

The disability insurance program itself must be reformed. Program administrators understand the need to encourage beneficiaries to return to work, and they have experimented with various incentives. Such initiatives have generally been ineffective, though, because they reach beneficiaries too late, after they have already become dependent on the program and lost their attachment to the work force.

A better approach has been suggested by David Autor of M.I.T. and Mark Duggan of the University of Maryland. In a paper released last week from the Center for American Progress and the Hamilton Project, these economists argue that employers should be required to offer their workers private disability insurance. Such coverage would provide people who have a work-limiting disability with vocational assistance, workplace accommodation and limited wage replacement. All of these benefits would kick in within 90 days of the onset of disability, to avoid the problems with delayed assistance that have plagued efforts to reform public disability insurance. Private employers would have an incentive to prevent their workers from having to file disability applications, because their insurance premiums would rise in response to higher disability rates.

Disabled workers could remain on this privately financed insurance for two years, and then be eligible for the existing public program. The goal would be to minimize long-term dependency, and re-orient the federal disability insurance program toward assisting those who are truly unable to work.

One concern is that this approach would burden firms with additional human resource costs when we need to encourage hiring. But the costs are projected to be modest — roughly $250 per worker per year. And if they help to reduce the future payroll tax increases that would be needed to finance rapid growth in disability benefits, the pressure on overall labor costs would be even smaller.

Another concern is that private insurance firms would need to be given substantially expanded responsibility for evaluating workers’ disabilities. Mr. Autor and Mr. Duggan propose to mitigate this potential problem by suggesting that workers be allowed to appeal any such evaluations to state government agencies.

The Netherlands has adopted a program like this, and the results so far are promising. In 1994, the Dutch government required all firms to finance the first six weeks of disability benefits. That period was later extended to one year and then to two years. In 2002, the program was broadened to require back-to-work plans, developed cooperatively by the disabled worker, his employer and a consulting doctor. The number of disability recipients in the Netherlands has since declined significantly.

None of these policy changes would be easy. But failing to act would result in millions of Americans needlessly dropping out of the work force. In our precarious economy, neither progressives nor conservatives should be willing to watch passively as the disability insurance rolls grow, and beneficiaries are locked out of the labor market.

So, people would have to buy even more insurance (employers would pass on the cost to their employees either directly or through reduced wages) and then rely on those private insurers to determine whether or not they are truly disabled when they have an accident or illness. But they’d get to appeal to a state agency if the insurer denies their claim. Any sense of how that might go? I think I have an idea. And I also have an idea what Orsazg means when he says “re-orient the federal disability insurance program toward assisting those who are truly unable to work.”

(And this isn’t the Netherlands. Our system is designed to deny citizens as many benefits as private businesses — and now government — can get away with. That’s just how we roll.)

Why Orsazg thinks it’s necessary to bring disability insurance reform into this argument at the moment is anybody’s guess. Right now, it’s hard enough for able bodied people to get work. And while I can see how concerned he is that the work ethics of the disabled will erode over time if they are given this easy ride, it’s hard for me to see why it should be of immediate concern considering that there are no fucking jobs. Are these people supposed to sell pencils on the street corner?

I haven’t even heard Republicans make this argument for cutting social security but you can be sure that you’ll be hearing more of it. The idea that the unemployed (who are already seen as hardly better than “illegal aliens” in the minds of a good number of Americans) are gaming the Social Security system will give impetus for more cuts and making it harder for legitimate claimants. But it will be a nice new market for the poor insurance companies won’t it? This new mandatory “private disability insurance” will be quite the bonanza, I’m sure.

Orszag has taken that job at Citibank. At this point it’s probably wise to assume he’s just doing what they’re paying him to do — taking advantage of his knowledge of the political thinking of the White House and the economic crisis to destroy the social safety net. But damn, putting the screws to the disabled who clearly qualify for SSI but would work if there were any jobs by making it harder for them to get SSI is just plain cruel.

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Is This A Great Country (for rich people) Or What? Part 249

by digby

Here’s the invisible hand doing what it does best:

As Don Blankenship prepares to give up control of Massey Energy after the nation’s worst mining disaster in four decades, angry shareholders who have been agitating for the coal executive’s ouster aren’t sure whether to celebrate or lament.

That’s because corporate filings are revealing the staggering cost of his departure — a golden parachute that will provide Blankenship with $2.7 million upon retirement, a free house for life, millions more in deferred compensation, and a “salary continuation retirement benefit” of $18,241-a-month that will continue for 10 years after his departure at the end of the year.

“The fact of the matter is, the company absolutely needs him to leave. You want to say, anything’s worth it because the company has no future with him,” said Per W. Olstad, a lawyer with CtW Investment Group, a shareholder group that has pushed for Blankenship to step down. “But it’s an egregious payout. It’s way beyond what he’s earned. Given how destructive his mismanagement has been, he simply does not deserve it.”

I’m sure most of you remember Blankenship. In case you don’t:

Twenty-nine miners died in the April explosion at Massey’s Upper Big Branch mine in West Virginia, and critics have claimed that Blankenship’s bottom-line management style contributed to safety risks. In SEC documents submitted by investors who made a failed bid to take control of Massey in 2006, Blankenship was repeatedly criticized for his approach to safety. In June 2007, two Massey board members resigned, saying they were stepping down in part because of Blankenship’s “poor risk management” and the company’s “confrontational handling” of regulatory matters.

Or maybe you remember this Tea Party event:

He’s just a good ole extremely wealthy plutocrat. I’m sure those tax cuts are going to get him out there creating jobs forthwith.

In case his successor is worried that Blankenship killed the golden goose, he needn’t worry:

Republicans in the U.S. House of Representatives just blocked efforts by Democratic leaders to resurrect a major mine safety reform bill before the end of the year and the GOP takeover of the House in 2011.

House Labor Chairman George Miller, D-Calif., had sought to suspend House rules and bring the pass the Robert C. Byrd Mine Safety Protection Act. to the floor for a vote.

The vote was 214 to 193, with 26 members not voting, well short of the two-thirds needed for the rules suspension.

According to the official roll call vote, only one Republican voted to bring up the bill. West Virginia Democrat Nick Rahall voted in favor, while Republican Shelley Moore Capito voted against. Democrat Alan Mollohan, who lost his re-election bid, did not vote.

So all is right in oligarchy. We can sleep well tonight.

No More Secrets

by digby

It’s not just Wikileaks, folks. The recklessness, lies and failure of the ruling elite has finally reached critical mass and average people in all walks of life are refusing to be a part of it. Here’s just one little example.

Sources familiar with the situation in Fox’s Washington bureau have told Media Matters that Sammon uses his position as managing editor to “slant” Fox’s supposedly neutral news coverage to the right. Sammon’s “government option” email is the clearest evidence yet that Sammon is aggressively pushing Fox’s reporting to the right — in this case by issuing written orders to his staff. As far back as March 2009, Fox personalities had sporadically referred to the “government option.” Two months prior to Sammon’s 2009 memo, Republican pollster Frank Luntz appeared on Sean Hannity’s August 18 Fox News program. Luntz scolded Hannity for referring to the “public option” and encouraged Hannity to use “government option” instead. Luntz argued that “if you call it a ‘public option,’ the American people are split,” but that “if you call it the ‘government option,’ the public is overwhelmingly against it.” Luntz explained that the program would be “sponsored by the government” and falsely claimed that it would also be “paid for by the government.” “You know what,” Hannity replied, “it’s a great point, and from now on, I’m going to call it the government option.” On October 26, 2009, Senate Majority Leader Harry Reid announced the inclusion of a public insurance option that states could opt out of in the Senate’s health care bill. That night, Special Report used “public” and “government” interchangeably when describing the public option provision. Anchor Bret Baier referred to “a so-called public option”; the “public option”; “government-provided insurance coverage”; “this government-run insurance option”; the “healthcare public option”; and “the government-run option, the public option.” Correspondent Shannon Bream referred to “a government-run public option”; “a public option”; “a government-run option”; and “the public option.” The next morning, October 27, Sammon sent an email to the staffs of Special Report, Fox News Sunday, and FoxNews.com, as well as to other reporters and producers at the network. The subject line read: “friendly reminder: let’s not slip back into calling it the ‘public option.’ ” Sammon instructed staff to refer on air to “government-run health insurance,” the “government option,” “the public option, which is the government-run plan,” or — when “necessary” — “the so-called public option”

Media Matters has the memos.

Now everyone has known forever that Bill Sammon is a rightwing hack of epic proportions. But the Network has defended Sammon as a straight reporter and the Villagers have had fits if anyone suggested otherwise. So this just proves something that was already obvious. What’s interesting about it is that FOX employees have had enough and are leaking the secrets.

The Wikileaks issue is fascinating, for sure, especially the idea that they can use the internet to disseminate information beyond a chosen few who are allowed to see it. But this is about the failure of our leadership and institutions over a long period of time and the culture of secrecy and corruption that’s brought us to this point. The system itself is leaking because its been compromised so badly. They can shut off the flow at any point and it will just leak elsewhere.

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Quote Of The Week

by digby

There are a lot of good ones to choose from but this is one for ages:

“Tragedy comes in threes,” Christine O’Donnell said. “Pearl Harbor, Elizabeth Edwards’s passing and Barack Obama’s announcement of extending the tax cuts, which is good, but also extending the unemployment benefits.”

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The Liberal Dilemma

by digby

Kevin Drum wrote an interesting post yesterday about the Democrats’ dilemma in dealing with a hardcore opposition that literally doesn’t care if their policies cause human suffering. (Indeed, they actually promote it, only they call it “tough love”.)Democrats are always in the position of having to choose between some specific thing that will alleviate some suffering (however temporarily) in exchange for some heinous Galtian thievery and they end up taking the short term relief because they believe they have the responsibility to help people in the best way they can. Unfortunately, when dealing with nihilists, you end up creating more and more circumstances where such deals with the devil are necessary.

Thought #2 comes from Andrew Sabl, who takes on the question of what liberal opponents of the tax deal propose to do next if it’s voted down. Andy says he doesn’t really have a great answer here, but that his focus is largely on the long term, not the immediate future: “how can we change baseline expectations so as to achieve progressive outcomes in future negotiations?” Dave Dayen makes a similar point here.

I haven’t thought this through carefully, but I think there’s a big problem with this framing. It assumes that our weakness is mostly with negotiating tactics: Democrats need to demonstrate that they’re willing to accept a whole lot of wreckage if they don’t get their way, and once they’ve done that Republicans will realize that they have to start compromising.

But there are two problems with this. First, there’s a real asymmetry between liberal and conservative goals. Liberals want active change. This means they can’t just obstruct. They have to figure out a way to build a supermajority coalition for complicated legislation, and that means compromise. And everyone knows this. So compromise is baked into the cake. But conservatives, to a much larger extent, are often OK with simply preventing things from changing, either as their first best or second best position. For that, all you have to do is maintain a very simple position among a minority caucus. No real coalition building or compromise is necessary.

Second, political coalitions are simply too public to sustain an artificial bargaining posture. The problem with the Democratic caucus isn’t that they negotiate badly, it’s that the Democratic caucus is genuinely fractured. And again, everyone knows it. You can’t pretend you’re willing to go to the mat against high-end tax cuts when there are half a dozen Democratic senators who support high-end tax cuts and Republicans know there are half a dozen Democratic senators who support high-end tax cuts. To fix this, you need more liberal Democrats, not tougher leadership.

In any case, Andy’s whole post is worth a read, especially his second point, which I think is a genuine and growing fracture point within the liberal coalition:

Civic republicans vs. non-republican liberals. Civic republicanism (small “r,” of course) is an awkward label for a common position: that the fundamental issue of our time is the ability of the rich, and corporations, to game the political system and prevent the rest of us from exerting true self-governance….In contrast, a non-republican liberal position is that giving material sustenance to the poor is more important than whether the rich get paid off, however regrettable and undeserved that is.

Andy describes himself as “mostly a liberal but with growing sympathies for republicanism,” and I’m pretty much in the same place. Maybe a little further along, in fact, though I still find myself nearly always supporting compromise positions that genuinely help people in the here and now. The last couple of years have certainly put a dent in that attitude, though. The rich have rubbed our faces a little too hard in the fact that they simply have no interest in what’s good for the country, only what’s good for their own bank accounts.

I think that’s happening to a lot of people and it’s a true moral and ethical dilemma. The result of this constant capitulation though is that liberals are participating in their own defeat and weakening themselves for future battles every time it happens — and ending up causing more human suffering in the process.

Jack Balkin makes the argument that the “parliamentarization” of our politics, with the Republicans establishing ideological cohesion, makes it inevitable that Democrats will also coalesce into a parliamentary-style party and do the same things when they get in the minority. If that’s true then I suppose one could anticipate that it would mean most liberal policy would advance from a minority position as they “hold hostage” the Republicans in the same way the Republicans are holding Democrats hostage today. But even assuming you could get ideological cohesion among the Dems (which I doubt) I’m afraid this moral dilemma would preclude them from being successful. You have to be willing to kill some hostages to be successful at this game.

The question is then, what to do? Bill Black and David Cay Johnson have some ideas. They say you have to deal with the Republicans like you deal with bullies — confront or outsmart. Of course, I think we all know situation where you find out that the people you think are your friends really side with the bullies (or in girl world — the popular girls) instead of you.

Anyway, this is a central problem for liberals and progressives as we try to go forward dealing with the Republican wrecking crew and their allies in the Democratic Party. I don’t know what the answer is.

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“It’s Yer Money”

by digby

The Republicans are all over the TV and in the papers arguing that tax cuts have nothing to do with the deficit because the deficit is a problem that can only be fixed with spending cuts. Now this should sound stupid even to people who aren’t following politics, but I’m afraid that it’s going to get traction if they keep saying it and the Democrats don’t come up with a good retort.

Here’s Bachman speaking gibberish:

BACHMANN: It’s curious to me that they say there’s a cost involved when people are allowed to keep their own money. And they’re talking about Americans being able to keep $700 billion of their own money. The cost is to the Treasury, but really it’s a cost out of the American peoples’ pockets. So that’s a definition of terms.

The real cost will be in the outlay of unemployment benefits and in the reduction to the treasury in the Social Security taxes.

Deficit hawk Judd Gregg was a little bit more elegant yesterday when he was questioned by Andrea Mitchell about the the millionaires’ tax cuts impact on the deficit when he just simply replied, “it’s their money” and characterized the problem as “too much spending” not too much taxing. I suspect that an awful lot of people are going to buy this absurd argument because it builds on an old theme that they recognize.

Maybe the Democrats should turn the GOP’s stupid “family budget” trope back on them and say that the Republicans believe that every family should let their main breadwinner spend most of his money on a fancy and expensive cars while the rest of them live on Top Ramen and soda crackers — because “it’s his money.”

It’s stupid too,of course, but if nothing else it might retires the idiotic “family budget” metaphor.

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We Didn’t Think Of That

by digby

Dear God. Some of these people must be either criminally inept or crudely malevolent. There is no other choice:

Q So the only reason that the payroll tax holiday will provide more stimulus is because it’s twice as large. Making Work Pay was capped. Why didn’t you preserve Making Work Pay? Is it because, as the President said some months ago, it’s just a kind of invisible tax cut and didn’t provide any political benefit for the White House?

MR. SUMMERS: No, it came out of the process of compromise with the Republicans who were more attracted to the payroll tax holiday concept, and that was a proposal that, as had been coming out of here, we had been giving considerable thought to in the context of the President’s budget.

I find it hard to believe that such smart people didn’t know that this was a landmine. If stupid hippie bloggers understand that it’s going to be nearly impossible to reinstate that tax, then surely world class intellectuals and political professionals do. They had to know that this was going to weaken social security and one can only assume at this point that they did it in service of their stated goal of “saving it” by cutting it — and being rewarded as big heroes by the people (and Wall Street.)

Somehow, I don’t think their clever plan is going to go the way they think it will.

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Why They’re Pissed

by digby

My main worries about the tax cut deal are mostly around the long term political effects, which I’ve outlined over the last couple of days. In my view, this was probably inevitable since they didn’t take advantage of Obama’s honeymoon and the financial crisis to ram through the middle class tax cut extension when they had the chance early in the term. Krugman raises some important questions about the likely economic effects that are rather alarming as well. He says, “Obama may be buying off the hostage-takers by … giving them more hostages.” So the laying of new time bombs that are ticking away in this bill form the greatest basis for my objections.

But I think Ezra really nails what gripes Democrats most about it and it’s very well illustrated by this graph:

Obama’s got 156 million people splitting $214 billion in tax cuts and benefits. The GOP’s got 4 million people splitting $133 billion in tax cuts. On a per-person level, the GOP’s tax cuts are much larger. An individual billionaire is getting a far better deal than an individual unemployed American. And that’s galling. The problem is that to take the money from the billionaire means to also take the money from the unemployed individual. Actually, taking the money from the billionaire means taking the money from a lot of unemployed Americans.

Everyone likes to portray this thing as being a “compromise” between the two sides. But it’s clearly much closer to the GOP wish list than anything the Democrats wanted and it’s using the GOPs preferred tool of tax cuts to do it. That just doesn’t seem like much of a Democratic accomplishment. Certainly, the braying about how incredibly “progressive” it is, and demanding gratitude for producing it (a very, very annoying habit from this administration) is a bit much, considering that the Party still has a majority and a Democratic president. It’s hard to see that as anything but a very weak result and nobody likes to be weak.

Update: Pastordan writes in with this observation:

I agree with you that the tax cut results look very weak, and nobody likes to be weak. But they also violate basic ideas of fairness. How many times are we going to let the rich get a better deal than everyone else? People know it’s unfair on a very basic level, and it pisses them off.

Anyway, the Magnificat is one of the appointed lectionary readings this weekend. Millions of Americans are going to be hearing this in church, and how do you suppose they’re going to hear it?

Luke 1:46-55

Mary’s Song of Praise

And Mary said,
‘My soul magnifies the Lord,
and my spirit rejoices in God my Saviour,
for he has looked with favour on the lowliness of his servant.
Surely, from now on all generations will call me blessed;
for the Mighty One has done great things for me,
and holy is his name.
His mercy is for those who fear him
from generation to generation.
He has shown strength with his arm;
he has scattered the proud in the thoughts of their hearts.
He has brought down the powerful from their thrones,
and lifted up the lowly;
he has filled the hungry with good things,
and sent the rich away empty.
He has helped his servant Israel,
in remembrance of his mercy,
according to the promise he made to our ancestors,
to Abraham and to his descendants for ever.’

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Vacancies and Vultures

by digby

Check out this amazing slide show about foreclosures in the Orlando area.

That picture is of a sheriff delivering an eviction notice to a woman who turns out to be a renter. He gives her one hour to gather her belongings and vacate the premises. She’s begging for more time.I don’t think I ever even considered that scenario but it’s probably not all that uncommon.

h/t to @MichaelShaw from BagNewsNotes

Telling It Like It Is

by digby

Following up on my post of this morning, I suppose it’s one thing for them to not be astute enough to defuse the bombs the Bush people set when they had the chance but when they show you that they are setting a new one you’d think they’d resist the temptation to hand them the fuse:

Obama, as part of the Democratic package, secured a roughly 30 percent cut in the payroll tax, from 6.2 to 4.2 percent. Allowing it to expire in a year will mean that workers will see a nearly 50 percent jump in payroll taxes as the rate reverts back — an event that will surely be described as a tax hike. The cut is estimated to cost $120 billion per year. Democrats have never allowed the rate to be cut, even temporarily, in the history of the program, because payroll taxes feed the Social Security trust fund and create the political base of support for the program, said Nancy Altman, author of “The Battle For Social Security”, a history of the program, and head of the advocacy group Social Security Works. Republicans have won a long-sought victory, even as President Obama hails it as a win for his party. Republicans acknowledged that the expiration of the tax holiday will be treated as a tax increase. “Once something like this goes into place, a year from now, when it expires, it’ll be portrayed as a tax increase,” said Sen. Bob Corker (R-Tenn.). So in a body like Congress, precedents matter and this is setting a precedent. I think that certainly is going to create some problems down the road if it passes.”[…]
Lamar Alexander, the Senate’s number-three Republican, also said that reform of Social Security should be tied to moving that tax rate back up. “My personal hope is that it doesn’t become permanent unless we deal with a way to make Social Security solvent over the long term,” he told HuffPost. “You have to remember, the payroll tax funds Social Security and I like the idea of a lower payroll tax contribution, but we’ve got to make sure Social Security is solvent, which we should be doing this next year as the first order of business.” The way to make the program “solvent” and keep taxes low, of course, is to reduce benefits.

Are we supposed to believe that the President and the Democrats who are voting for the tax cut aren’t aware of all this?

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