Month: July 2011

Can you say … WTF?

by digby

Today’s economic data is, shall we say, bracing:

The country’s gross domestic product, a broad measure of the goods and services produced across the economy, grew at an annual rate of 1.3 percent in the second quarter, after having grown at an annual rate of 0.4 percent in the first quarter — a number that itself was revised sharply down from earlier estimates of 1.9 percent . Both figures were well below economists’ expectations.

Data revisions going back to 2003 also showed that the 2007-2009 recession was deeper, and the recovery to date weaker, than originally estimated. Indeed, the latest figures show that the nation’s economy is still smaller than it was in 2007, when the Great Recession officially began.

“The word for this report is ‘shocking,’ ” said John Ryding, chief economist at RDQ Economics. “With slow growth, higher inflation and almost no consumer spending growth, it is very tough to find good news.”

The latest figures come as Congress is debating how to put the nation on a more sustainable fiscal path, with measures that some economists worry could further slow the economy and even throw it back into recession. Even in the absence of further austerity measures, some of the government’s current stimulative policies, such as the payroll tax cut, are phasing out, and state and local governments are slashing spending dramatically.

Such fiscal retrenchment was already expected to be a drag on growth in the coming year; the Commerce Department’s report and the Washington debt talks only magnify those concerns.

Yeah.

As for the politics, CBS Senior correspondent Nora O’Donnell just asserted in the White House briefing that the Democrats haven’t compromised. Jay Carney explained that they have backed off clean debt limit demand, accepted dollar for dollar cuts and accepted no revenues as part of the package. You’d think she would have known that.

Earlier I saw a man on the street segment on CNN in which every single person said that both parties are behaving like children and they should just sit down and figure out what needs to be done. I’m sure that someday they’ll understand that the Democrats were the adults in the room and the GOP were the psychos, but I’m not sure they’ll find it to be very reassuring at that point.

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At the zoo

by digby

It’s quite a day so far. The Republicans are pretty much going to pass a bill that’s even more horrifying than before. It seems they are particularly outraged by Pell Grants at the moment, which Gaius Publius pointed out to me on twitter is not because they fear educated people, but because they think only black people get them. Of course.

Think Progress reports:

The House GOP is now advancing a plan that Paul Ryan admitted yesterday is “unrealistic.”

Meanwhile, the President came out again and told people to tweet their congressmen. because it was such a successful ploy the last time. If I had to guess, the Tea Partying wrecking crew tend to only hear the constituents who are reinforcing the moronic view that failing to raise the debt ceiling will magically erase the debt and make all the icky undeserving icky people disappear so America will be pure again.

David Frum wrote that Ann Coulter may be shrill but she isn’t a fool for saying that Republicans are going to be left holding the bag if all this blows up. (No word on whether or not she’ll ever be held responsible for her starring role in the creation of the psychopathic modern right wing.) Hopefully she’s right, but somehow I have my doubts. As Krugman points out in his column this morning:

…News reports portray the parties as equally intransigent; pundits fantasize about some kind of “centrist” uprising, as if the problem was too much partisanship on both sides.

Some of us have long complained about the cult of “balance,” the insistence on portraying both parties as equally wrong and equally at fault on any issue, never mind the facts. I joked long ago that if one party declared that the earth was flat, the headlines would read “Views Differ on Shape of Planet.” But would that cult still rule in a situation as stark as the one we now face, in which one party is clearly engaged in blackmail and the other is dickering over the size of the ransom?

The answer, it turns out, is yes. And this is no laughing matter: The cult of balance has played an important role in bringing us to the edge of disaster. For when reporting on political disputes always implies that both sides are to blame, there is no penalty for extremism. Voters won’t punish you for outrageous behavior if all they ever hear is that both sides are at fault.

Let me give you an example of what I’m talking about. As you may know, President Obama initially tried to strike a “Grand Bargain” with Republicans over taxes and spending. To do so, he not only chose not to make an issue of G.O.P. extortion, he offered extraordinary concessions on Democratic priorities: an increase in the age of Medicare eligibility, sharp spending cuts and only small revenue increases. As The Times’s Nate Silver pointed out, Mr. Obama effectively staked out a position that was not only far to the right of the average voter’s preferences, it was if anything a bit to the right of the average Republican voter’s preferences.

But Republicans rejected the deal. So what was the headline on an Associated Press analysis of that breakdown in negotiations? “Obama, Republicans Trapped by Inflexible Rhetoric.”

It’s pretty to think that at the end of this the country will see the GOP for the extremists they are, but I have no reason to believe that’s how it’s been portrayed. In my own, admittedly small, survey of ordinary people, they blame whoever they didn’t vote for and “government” in general. Here in California we’ve been dealing with a dysfunctional capitol for so long it’s just standard operating procedure.

The best thing that’s happening in Washington right now is at the zoo (and I don’t mean the capitol.)

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A Sickness that Knows No Name
by David Atkins (“thereisnospoon”)

As we awaken on Friday morning here on the California coast, John Boehner will already have started trying to whip the votes he couldn’t get yesterday over in Washington, D.C. The nation’s capital has been waiting with bated breath to see if Boehner could pull enough of his caucus together to pass his austerity bill. Which is really funny, considering that the bill has zero chance of getting passage in Reid’s Senate, and even less chance of being signed by President Obama regardless. Nothing could better exemplify the comic farce that is the D.C. media bubble than this latest much ado about nothing.

Kudos are owed to Nancy Pelosi for keeping her caucus together, even the Blue Dogs, and not giving Boehner any votes (same for Reid, who even managed to keep Joe Lieberman on board.) But what, exactly, is Boehner having trouble with his caucus over? As The Hill reports, it appears to be Pell Grant funding:

House conservatives who have stalled legislation to raise the national debt limit are angry that it includes $17 billion in supplemental spending for Pell Grants, which some compare to welfare.

Legislation crafted by House Speaker John Boehner (R-Ohio) to raise the debt limit by $900 billion would directly appropriate $9 billion for Pell Grants in 2012 and another $8 billion in 2013.

This has shocked some conservative House freshmen who say they were elected to cut spending, not increase it. Some House Republicans think of it as being akin to welfare.

So this is what it comes down to. Spending a few billion on giving kids the prayer of being able to afford to go to college given skyrocketing tuitions is just too much for the Tea Party brigade. Money for college is just the same as “welfare.” Before you know it, those strapping young college kids will be driving Cadillacs and eating T-bone steaks, the lazy freeloaders. Far better that they stay in the menial labor workforce, as the hired help for America’s “job creators,” while we merrily piss away trillions of dollars on pointless wars for oil overseas.

Back in the days before euphemisms came in vogue for such things, they used to call that moral evil. Nowadays a professional psychiatrist might call it antisocial personality disorder, except that we know there aren’t that many actual clinical sociopaths out there. What it is, is a culture of sociopathy, made possible by a 30-year-long echo chamber of right-wing radio, Fox News, corrupted church propaganda, and astroturf think tanks. Back in the days before the conservative echo chamber, it used to be deeply embarrassing to hold these sorts of views. Now, the more extreme your devotion to the sociopathic line, the better proof of your membership in the right-wing cult.

But it’s not just that: they’re deeply stupid as well. Without getting into the fact that spending on education is an investment in America’s future potential, and that anyone who did what Tea Partiers claim to want and “ran government like a business” would instantly see that such investments must be made, the numbers don’t add up, either.

As Dave Dayen tweeted, the increase to Pell grants in Boehner’s bill is more than made up for by cuts to student loans elsewhere. In fact, the sum total of the elimination of certain student loan subsidies combined with increases to Pell grants actually saves the government money long-term. Per the CBO analysis of Boehner’s bill (see Chart 3 at the end), the $17 billion in increases to Pell grants are offset by $22 billion in cuts and savings elsewhere. And yet that is what the Tea Party crowd is willing to scuttle a political negotiating chip and John Boehner’s sorry career over, in a bill that won’t even get past the Senate, anyway.

What’s the clinical term for mass delusion combined with immorality and abject stupidity? I’ll leave that to the sociologists and mental health professionals to decide.

All night long

by digby

So the Speaker closed down the negotiations and everyone went home for the night. Times have certainly changed. There was a time when they did whatever it took to get a bill passed, even if it meant keeping the vote open all night long:

Rep. Nick Smith, R-Mich., says that sometime late Nov. 21 or early in the morning Nov. 22, somebody on the House floor threatened to redirect campaign funds away from his son Brad, who is running to succeed him, if he didn’t support the Medicare prescription bill. This according to the Associated Press. Robert Novak further reports,

On the House floor, Nick Smith was told business interests would give his son $100,000 in return for his father’s vote. When he still declined, fellow Republican House members told him they would make sure Brad Smith never came to Congress. After Nick Smith voted no and the bill passed, [Rep.] Duke Cunningham of California and other Republicans taunted him that his son was dead meat.

Speaking through Chief of Staff Kurt Schmautz, Smith assured Chatterbox that Novak’s account is “basically accurate.” That means Smith was an eyewitness to a federal crime.

Nothing happened to anyone over that of course. Duke Cunningham later went to jail on unrelated charges.

But the lesson is that Republicans usually have a way of passing things they really want to pass.

h/t to @ericboehlert

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“The pursuit by governments of policies contrary to their own interests, despite the availability of feasible alternatives”

by digby

Ok, It’s time to worry. Krugman:

For some reason events in European bonds markets aren’t making big headlines. But they should be: even as the GOP does its best to destroy America’s credit, things are falling apart, with a vengeance, on the other side of the Atlantic…

What this is surely about, instead, is the growing sense that European recovery is sputtering out, and that the European Central Bank — which sets short-term rates — will eventually call off or even reverse its planned rate hikes, with rates staying low for a long time.

In short, what the markets seem to be seeing is disaster on the periphery and the Japanification of the core. And I can’t say they’re wrong.

In his next post he writes:

Simon Johnson writes about who’s worse — America or Europe? Basically I agree with his assessment: Europe has more fundamental problems in sheer economic terms, because it adopted a single currency without the necessary institutions to make it workable. America has a long-run budget problem, but our current mess is entirely political. Unfortunately, that doesn’t make it any easier to solve.

What’s extraordinary, though, is the paralysis that has taken over essentially the entire advanced world…

The only major problem we have right now is the one that was supposed to be easy to solve: a simple lack of adequate demand. And we’re totally failing in our response.

In the long run, Keynes must be spinning in his grave.

This is lunacy. I thought I could put it away for awhile but guess it’s time for me to get out that dog eared copy of Tuchman’s March of Folly one more time.

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Idiot Collaborators

by digby

Please someone tell me again about how the Tea Partiers are populists. I’m watching on of their spokesmen on MSNBC go on and on about how the rich pay all the taxes and it’s time for the 50% of American slackers who don’t pay anything to kick in to solve the debt crisis.

“I know a lot of people and I don’t know even one who has a corporate jet. I do know that wealthy people create jobs. I’ve never worked for a poor man or a poor woman. They’ve all provided me with a good living.”

If you’re looking for them to bring in the guillotines, you’re going to be waiting awhile. They are very happy to be serfs.

FYI:

Today, TPC released a new study that examines why these people end up paying no federal income tax.

The number one reason should come as no surprise. It’s because they have low incomes. As my colleague Bob Williams notes:

A couple with two children earning less than $26,400 will pay no federal income tax this year because their $11,600 standard deduction and four exemptions of $3,700 each reduce their taxable income to zero. The basic structure of the income tax simply exempts subsistence levels of income from tax.

Low incomes (or, if you prefer, the standard deduction and personal exemptions) account for fully half of the people who pay no federal income tax.

The second reason is that for many senior citizens, Social Security benefits are exempt from federal income taxes. That accounts for about 22% of the people who pay no federal income tax.

The third reason is that America uses the tax code to provide benefits to low-income families, particularly those with children. Taken together, the earned income tax credit, the child credit, and the childcare credit account for about 15% of the people who pay no federal income tax.

Taken together, those three factors — incomes that fall below the standard deduction and personal exemptions; the exemption for most Social Security benefits; and tax benefits aimed at low-income families and children — account for almost 90% of the Americans who pay no federal income tax.

Maybe if 50% of Americans weren’t so poor, they’d be privileged to pay income tax too. But until these teabaggers come up with a jobs program beyond “let them eat cake” they’ll have to be content with them paying their state tax, their property tax, their gas tax, their sales tax, their payroll tax and all the other taxes they still have to pay even if they are such “lucky duckies” as to be allowed to keep some tiny portion of the rest of their meager incomes to feed themselves.

I keep hearing that the Tea partiers are radicals and anarchists, as if they are some kind of intellectual force to be reckoned with. But there’s no there there. They are simpletons, drunk with power, who in their zeal to serve their masters have decided to burn all the crops in order to save on watering costs.

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Torture Zombie

by digby

Wow. If I didn’t know better I would think that this man was in the employ of America’s most hated enemies. It’s hard to think of a more destructive person:

[T]he debate doesn’t simply involve warring economists. Instead, one of the louder voices belongs to David Addington, the architect of the George W. Bush administration’s harsh interrogation policies and a former chief of staff for then-Vice President Dick Cheney.

Addington has taken on a new role as enforcer of tea party dogma during the intensifying partisan bickering over the debt ceiling. From his perch as the Heritage Foundation’s vice president for domestic and economic policy, Addington is throwing verbal thunderbolts at House Speaker John Boehner’s current debt-ceiling proposal, which he argues will pave the way to tax increases…

Addington kept a low profile during the Bush years, granting no interviews and largely shunning lawmakers from either party. But he wielded enormous power behind the scenes, helping Cheney craft the Bush administration’s warrantless eavesdropping program and most of its detention initiatives.

Critics of those policies say they’re horrified by Addington’s reemergence onto the public stage.

“To see this person who led the country into legal and moral disaster resurface as a respected commentator is somewhat galling,” said Ben Wizner, the litigation director of the American Civil Liberties Union’s National Security Project. “Addington was as responsible as anyone else for the U.S. becoming a torturing nation. He has done damage to the U.S. that will take decades to reverse.”

Addington didn’t respond to e-mails seeking comment, but Heritage Foundation spokesman James Weidman noted that Addington had handled domestic issues for Cheney as well as national-security ones.

This would be the problem with not playing the blame game or looking in the rear view mirror. If you don’t destroy these zombies’ ability to wield their malevolent influence, they just keep coming back. Some day people will realize that they are dangerous, even when they’re out of office.

Some liberal legal scholars—citing the fourth section of the 14th Amendment, which says “the validity of the public debt of the United States, authorized by law … shall not be questioned”—believe that Obama has the power to disregard the congressionally imposed debt ceiling. The White House has disregarded that advice, preferring to continue the to-date fruitless negotiations with Boehner and Republicans. That means Addington, as strong a proponent of unbridled executive branch authority as can be found in either party, is now in the strange position of supporting lawmakers trying to bind a president’s hand.

That’s just hilarious. There is no such thing as hypocrisy or intellectual consistency among conservative zombies. They just eat your brains and move on.

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Home Again, Home Again
by David Atkins (“thereisnospoon”)

While Harry Reid and John Boehner posture over just whose nearly identical version of austerity will reach the President’s desk, another side drama has been playing out over the possible inclusion of a tax holiday for corporations performing accounting gimmicks by shifting profits through global tax havens. For instance, Microsoft only paid a 7% tax rate on last year’s profits:

If you want to know why tax from surging corporate profits isn’t making much of a dent in the United States’ crippling budget deficit, a glance at Microsoft Corp’s recent results provides some clues.

Things were rosy in the giant software company’s just-ended fiscal fourth quarter, which produced record sales of nearly $17.4 billion, a 30 percent increase in after-tax profit, and a 35 percent gain in earnings per share…

Partly it was because the company had a one-time refund of $461 million from the IRS for previous overpayments and because of its over-estimation of tax rates in previous quarters. There may be increased sales of products to consumers overseas, though it is not clear from company disclosures how much of a factor this might be.

But Microsoft is straightforward about the core reason for its lower tax bill: It is increasingly channeling earnings from sales to customers throughout the world through the low-tax havens of Ireland, Puerto Rico and Singapore.

This sort of thing is, of course, happening all over the corporate sector. It leads not only to a loss of jobs in the United States, but also to a gaping budget hole requiring austerity measures, politically difficult revenue increases or both. Conservatives like to complain that this is due to America’s high corporate tax rate of around 35%. They claim that companies like Microsoft have no choice but to shift profits overseas. But while it’s true that that nominal corporate rate is the 2nd-highest in the world, the effective corporate is far, far lower due to all the tax loopholes. But conservatives do have something of a point here, in that it’s a lot easier for a corporation just to take those profits overseas than to pay all those accountants to find and exploit all those loopholes.

That’s why when revenue increases on the corporate sector are considered, smart politicians don’t talk so much about raising taxes on corporations (which would actually be counterproductive in some ways given our already high nominal rate), than about eliminating the loopholes they’re allowed to exploit, which would result in far more revenue generation than would raising the nominal rate, while also leveling the playing field for smaller companies that don’t have the resources to try to exploit them.

But there’s also the issue of what to do about companies that have already taken their profits offshore. Enter the odious “corporate tax holiday.” The tax holiday would allow corporations to repatriate their funds, but at much lower level than the nominal rate. Matt Taibbi has more:

The madness that is the proposed tax repatriation holiday is continuing and gathering steam. More and more members of congress are coming out of the woodwork, scratching their chins in contemplative consideration as it were, pretending that they’ve just realized what a great day a corporate tax holiday would be – not that they’ve taken gazillions of dollars from the firms lobbying for it or anything…

One thing that people must understand about this tax repatriation business is that it’s a wholly bipartisan affair. It’s not solely the work of evil Republicans. This is a scheme that requires heavies in both parties to help ram the knotty, hard-to-sell legislation through. On the Democratic side, unsurprisingly, the main actor is going to be Chuck Schumer. John Kerry is also involved with this nastiness. Barbara Boxer led the 2004 effort and the failed 2009 campaign to get a holiday, and is rumored to be lurking somewhere in this business.

As Taibbi correctly points out, we’ve done this before, and rather than creating jobs, it simply created a stock repurchasing bonanza for the corporations themselves. And yet there seems to be a very bipartisan push to do it again, meaning that there will be no incentive at all for large corporations to continue to take profits in this country as they know that they’ll get one of these sweet deals at regular intervals. More Taibbi:

I’m still shocked at the lack of press coverage of this. In all this scratching and clawing over dimes here and there, and clamoring for trillions in cuts, we’re seriously considering what amounts to a gigantic new systematic loophole for corporate taxes?

Again, if they pass this thing one more time, the fiction of the “one-time holiday” disappears forever, and the next decade will see an explosion of exported profits, “transfer pricing,” and cunning use of correspondent banks to stealth-repatriate offshored funds. Everyone will know that the effective corporate tax rate has been dropped from 35 percent to 5 percent – all companies need to do is hide profits overseas and bring them back about once every presidential term or two.

There’s a “good government” argument for doing this, of course: the potential alternative that the U.S. will never see even a dime of that revenue otherwise. That’s why everyone from SEIU figures to the awful Third Way people to the cigar-chompers at Duke Energy are all supporting the holiday:

At a Third Way think-tank conference in Washington last week, Andrew Stern, former president of the Services Workers International Union, presented the case in favor of a new tax break at a panel discussion on the issue.

“So we have an American problem. We have very few solutions, given the nature of politics here,” he said.

“And I think when Democrats realize that this is stimulus and probably the only stimulus that has a chance of passing, and Republicans realize this is a corporate tax break, you know we have a perfect situation for a solution,” Stern said.

The main argument in favor of the corporate tax holiday is that money spent abroad is money that is not being spent here in the United States.

“I cannot believe under any circumstances that having a trillion dollars overseas is an advantage over having a trillion dollars at home,” said Stern.

Jim Rogers, president and CEO of Duke Energy, participated in the Third Way event also, and addressed one question being put forward, i.e. “Would it be better to have another stimulus for a trillion dollars or to bring this money back?”

“And the answer is, hands down, bring this money back. Our country cannot afford another stimulus, particularly the way the money is deployed. We can’t afford it, and the reality is, we need to face up to that and move on to something that we can afford and will actually help generate jobs in this country,” he said.

But, of course, that’s not actually true. First of all, the tax holiday doesn’t help create jobs: it helps inflate corporate stock prices and corporate bottom lines, with a minimal boost to the national treasury. And as we all know, jobs and rising stock prices stopped going hand in hand long ago.

There are multiple other solutions to the problem, including levying hefty fines and other punitive measures on corporations that take this step. How long would Microsoft last if it had to pay a 20% premium for selling its products to U.S. customers while offshoring profits, and try to pass those along to the American consumer? Not long.

What we have is a political problem. On both sides of the aisle, that sort of anti-flat-world policy would be considered “protectionism.” And that’s a dirty word among the Grand Poobahs and Mandarins in both parties.

Which means that once Boehner, Reid and Obama are all done posturing for one another and we get a final austerity package, watch for this corporate giveaway to be included in the final bill, courtesy of that wonderful “bipartisan consensus” so many voters seem to cherish.

Pay no attention to what they’re actually saying

by digby

CNN’s been doing segments all morning at a senior citizen’s center in Pasadena and they keep ignoring what these people are actually saying in order to create a narrative that these people are upset by the “sausage making,” when what they are actually upset by is the fact that the safety net programs are on the chopping block. They jsut refuse to acknowledge the substance of their complaints.

MALVEAUX: Well, now seniors are worried about cuts to those programs because of the debt crisis. We’ve got a live report up ahead…

Debt limit and the standoff has a lot of us worried about what is going to happen to mortgage rates, car loans, even our 401(k)s. But many seniors are worried about cuts to programs they depend on every day. We’re talking about Medicare, Social Security, many other things.

CNN’s Sandra Endo, she joins us at a senior center in Pasadena, California. Sandra, I can only imagine what people are saying about this standoff that is taking place in Washington.

SANDRA ENDO, CNN CORRESPONDENT: Yes, Suzanne, seniors here say they are scared, they’re worried. If they don’t get their Social Security checks or any cuts to Medicare and Medicaid, well, that would severely impact their livelihoods.

And we brought together some young, feisty seniors this morning to talk to us this morning about what’s going on in Washington. And Anastasia here, you say you are watching the political debate play out, and you say you are angry. How angry does it make you?

ANASTASIA STEWART, SENIOR CITIZEN: Makes me want to hit the streets, because what they tell us is not the way it always is. And I am tired of the political games; I’m tired of them treating the American people like they don’t have brains at all.

ENDO: And how would this impact you if those cuts are enacted?

STEWART: Well, we won’t be paying our rent and you will have even more homeless people. We are becoming almost a third-world nation. It’s of the corporations, by the corporations and for the corporations. People don’t seem to matter anymore. But you can know that Washington’s going to take care of Washington and the heck with the rest of us.

ENDO: And, Mildred, you feel the same way. How would these proposed cuts or if you don’t get your Social Security, what would that mean for you?

MILDRED HAWKINS, SENIOR CITIZEN: I means that I’m suffering from the two h’s, homeless and hungry. Please, play in the parks, not with my Social Security.

ENDO: You feel like you’re a hostage in all this?

HAWKINS: Absolutely. I worked years and years to save money to live off when I become a senior. What do I have to look forward to now?

ENDO: Yes, it’s a very troubling situation.

I’m joined also by an AARP representative.

Ernie, you’ve been campaigning for these seniors. What are you doing to fight?

ERNIE POWELL, AARP ADVOCACY DIRECTOR: Well, we have a national campaign called Protect Seniors. And our message is, don’t cut Social Security, don’t cut Medicare as any — as part of any deal on the debt ceiling or for deficit reduction. AARP members and their families and people on Social Security have worked their entire lives. These are earned benefits. So we can’t see this happen. And we’re asking our members to — and all the public to let their congressman know to not make deals that cut Social Security and Medicare.

ENDO: All right, thank you so much, everyone. And they have a petition. A lot of signatures. People are signing to make sure their representatives in Washington are listening. But that’s the big question, Suzanne.

MALVEAUX: Sandra, that’s just excellent when you hear just, you know, how this is going to impact folks and the kinds of feelings, emotions that they have about this. Clearly this is beyond Washington. There’s a lot of, you know, as you say, the ugliness of the sausage is being made. But people outside of Washington wondering what is going to happen next. We’re keeping a close eye on that as well, Sandra.

Here’s the next segment, in which they twist the comments to reflect an concern about default, when it’s obvious these people are talking about the “entitlement” cuts in the general:

Randi Kaye: Are they alarmed by what they see happening, or not happening, in Washington?

Sandra Endo: Absolutely Randi. A lot of emotion, strong opinions coming from a lot of the seniors we’ve spoken to. People are scared, they’re worried, they’re angry about what’s going on in Washington. A lot of people are just frightened because they rely on their social security and of course Medicare and Medicaid for their livelihood. Let’s talk to Bobbie right now.

You were talking to me earlier about what’s going on in Washington right now. Tell me how angry are you?

Bobbie: very, very angry. It’s because I wouldn’t be able to live the lifestyle I live if I did not have my social security, even though I work part time, 36 hours a week. I could not live on either one of them alone.

Sandra Endo: So you would be out on the street?

Bobbie: probably worse than that because I don’t think, the way I see some people on the street, I don’t think I would be able to live that kind of life. I wouldn’t be able to function. So I hate that that might be staring us in the face.

Anastasia, what do you think of all the back and forth bickering?

Anastasia: I think I would like to see all of them have to trade places with us and let them try to live on what we don’t have and what they’re trying to cut even more of. Social Security has not even contributed to the deficit and yet they’re more than happy to take it and use it wherever they’d like.

And all the back and forth, the fighting?

Anastasia: The political games that they play. It’s a bad role model for our kids I must say. Truth has become obsolete. And that’s very sad. And yet we claim to be a country that tells the truth and that’s democratic and yet we’re not doing a very good job of that ourselves.

Sandra Endo: Alright. Thank you so much for sharing your opinions. Obviously a very emotional time for seniors and they wait, as the whole country waits Randi for some kind of deal, some kind of compromise, something, answers to come out of in Washington.

Randi Kaye: It sounds like some folks are worried about the long term and any changes that might happen to entitlements, social security, medicare, medicaid?

Sandra Endo: Oh absolutely, they are relying on these checks to come. And even president Obama when he spoke saying we will be in limbo that if the country is broke and they won’t have enough money to send out these checks…

It’s a buzz here, people grabbing me wanting to say what they think is going on in Washington, they’re angry feeling like they’re being held hostage.

Randi Kaye:Sandra Endo in Pasadena, interesting to hear some fresh voices, it sounds like they really have a fight under way there.

That woman Anastasia is better informed and smarter about what’s really going on than any of the journalists involved in this piece.

These people are worried about themselves, to be sure. But they are worried about the programs’ future because they know how meager they are and how difficult it is to live on them as it is. Randi Kaye had a brief moment of clarity there but quickly shook it off and went back to the storyline, which is that everyone’s upset about the “foodfight” and the “sausage making” and the “bickering” not the substance of the proposed deals. But it’s not true.

I don’t know who will get the blame for all this, but I certainly know who’s taking credit for it. And this large and growing segment of the population does not like what’s being proposed.

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A Village Consensus

by digby

No matter how much time people spend talking about the issues, no matter how many fact sheets are distributed,it seems nothing will penetrate the wall of misinformation.

No matter what plan emerges from the debt talks in Washington, future Social Security benefits will be trimmed back.

As Congress and the White House continue their dysfunctional dance toward financial Armageddon, the elusive, $4 trillion Grand Plan that would include Social Security and Medicare reform has fallen off the table.

But in the early stages of the budget battle, a series of proposals surfaced that provide some clues about what broad reform of Social Security might look like.

There’s widespread agreement that the program needs fixing. When first created in 1935, the earliest retirement age was 65, a year older than the average life expectancy. Today, beneficiaries can begin collecting at 62, and can be expected to live another 17 years.

Bullshit.

Meanwhile, the base of support from workers paying into the system has shrunk dramatically. In 1950, there were 16 active workers paying for every retiree. Today the ratio is three to one, according to the National Committee on Fiscal Responsibility and Reform, the authors of the so-called Simpson-Bowles plan to cut the federal budget deficit.

More bullshit

This wouldn’t be the first time Congress enacted major changes to get Social Security back on track. In 1983, a series of tax increases and future benefit cuts extended the program’s financial lifespan. The full-benefit age was lifted from 65 to 67; a portion of benefits were subject to taxes; and cost of living adjustments were delayed by six months. The overall impact was to cut benefits for a current retiree by about 19 percent, according to the National Academy of Social Insurance

None of the current proposals envisions a cut in current benefits. But they all employ a mix of future cuts, taxes, and changes in the cost of living formula.

Even more bullshit.

But it doesn’t matter. These “truths” are pumped out by news organizations daily and there’s just no stopping it. They are convinced that this raid on Social Security is legitimate and necessary and nothing will change their minds. And they insist that the only possible “fix” is to raise the retirement age and lower benefits even more with a new cost of living formula. It’s a Village article of faith, validated by politicians of both parties. If you disagree you are a crazy, fanatical partisan and nobody should listen to you.

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