Saturday, April 6, 2013

Has Everyone Lost Their Minds? No, But the Entire Elite Has Been Influenced by Economic Myths of the Robert Rubin-Pete Peterson-Fix the Debt Propagandists and GMO Toxic Chemical Pushers

Krugman rules again.

So what’s this about? The answer, I fear, is that Obama is still trying to win over the Serious People, by showing that he’s willing to do what they consider Serious — which just about always means sticking it to the poor and the middle class. The idea is that they will finally drop the false equivalence, and admit that he’s reasonable while the GOP is mean-spirited and crazy.

April 5, 2013


Desperately Seeking “Serious” Approval

Sigh. So Obama is going with the “chained CPI” thing in his latest proposal — changing the price index used for Social Security cost adjustments. This is, purely and simply, a benefit cut.
Does it make sense in policy terms? No. First of all, there is no reason to believe that the chained index is a better measure of inflation facing seniors than the standard CPI.

It’s true that the standard measure arguably understates inflation for the typical household — but seniors have a different consumption basket from the young, one that includes more medical expenses, and probably face true inflation that’s higher, not lower, than the official measure.

Anyway, it’s not as if the current level of real benefits has any sacred significance. The truth — although you’ll never hear this in Serious circles — is that we really should be increasing SS benefits.

Why? Because the shift from defined-benefit pensions to defined contribution, the rise of the 401(k), has been a bust, and many older Americans will soon find themselves in dire straits. SS is the last defined-benefit pension still standing — thank you, Nancy Pelosi, for standing up to Bush — and should be strengthened, not weakened.

So what’s this about? The answer, I fear, is that Obama is still trying to win over the Serious People, by showing that he’s willing to do what they consider Serious — which just about always means sticking it to the poor and the middle class.

The idea is that they will finally drop the false equivalence, and admit that he’s reasonable while the GOP is mean-spirited and crazy

But it won’t happen. Watch the Washington Post editorial page over the next few days. I hereby predict that it will damn Obama with faint praise, saying that while it’s a small step in the right direction, of course it’s inadequate — and anyway, Obama is to blame for Republican intransigence, because he could make them accept a Grand Bargain that includes major revenue increases if only he would show Leadership (TM).

Oh, and wanna bet that Republicans soon start running ads saying that Obama wants to cut your Social Security?

Of course they will, and Obama, being a pretty sharp guy, knows this. So suck on that (for a while).

Speaking of sucking on very bad information . . . I recently saw this video, which is loaded with good sources of information and immediately started gagging when I thought about the food I eat (and used to eat) to try to stay healthy.

As an example, I grew up eating oatmeal and used to eat it every day but had to stop when I noticed that the oatmeal seemed stale - or just dried out and not as tasty or as filling as it had been previously. And I noticed it every time I ate another bowl. Reading the ingredients on the labels and then articles on nutrition about the changes in our food supply led me to think that GMO's may be the culprits (but you won't learn this from the FDA, USDA or EPA). Monsanto's control of the grain market is well documented. You'd think they might leave oats alone, though, wouldn't you? After all they're about the last thing we can eat to try to give our insides some respite, and they've already ruined the corn, wheat, alfalfa and soybeans (not to mention the widespread use of bovine growth hormone which really screws up our insides).

Nothing we're ingesting now is what we ate when we were growing up (unless you're under 30, of course, and then you're already likely to be included in the statistics for all those new childhood diseases and conditions like pediatric obesity, diabetes, celiac disease, ADD, ADHD . . . .).

Thank you, Roundup! Progenitor of a new organism that is destroying animals from within?

Monsanto's goal is to replace all natural seeds with genetically-modified seeds . . . that they own the patents for (and to spread the use of Roundup and other nature killers as widely as they desire). It's no secret, friends.

Watch this video as though your life (your healthy life) depends on it!

Back to my original topic (which incredibly is more personally threatening than the screwed-up diet we're forced to absorb) - the disastrous job situation (and the horribly tiny number of new jobs created just last month) still raging after four years of what we may think of as the limited hangout of minor relief agreed to by those who brought all the damage to us in the hope that we may appreciate their largesse and forget the finer details of the situation and just blame the Democrats and Obama for all the damage continuing to exist. Robert Kuttner is particularly eloquent now. I've agreed with his conclusions many times in the past, but few like the one below. I believe that the end of the Democratic party has immediately followed the end of the Republican party: both from self-inflicted wounds.

Destroying the Economy and the Democrats

Robert Kuttner

April 5, 2013

Amid disappointing jobs numbers, the president's budget proposal gives away his party's crown jewels: their defense of Social Security and Medicare.

Job creation slowed to just 88,000 in March, signaling a sluggish economy. And President Obama, with unerring timing, picked this moment to put out an authorized leak that he is willing to put Social Security and Medicare on the block as part of a grand budget bargain that will only slow the economy further.

The deterioration in economic performance was all too predictable, given the combined lead weights of the March 1 $85 billion of budget cuts in the sequester and the January deal to raise payroll taxes by about $120 billion. (The tax hike on working people was almost double the much-hyped tax increase on the top one percent, which totaled a little over $60 billion.)

Taken together, these twin deflationary deals cut the deficit by around $270 billion dollars this year. That’s close to two percent of GDP. And according to the Congressional Budget Office, this combined contractionary pressure will cut the 2013 year’s growth rate in half. So the slowdown in job creation is just what you’d expect.

The grand bargain that, for the moment, is mercifully eluding President Obama and the Republicans, would apply the same sort of medicine for nine more years, and with the same results — a prolonged slowdown growth and jobs. Obama and the Republicans are talking of a decade of cuts in the 3 to 4 trillion-dollar range.

Has everyone lost their minds? No, but the entire elite has been influenced by the economic myths of the Robert Rubin-Pete Peterson-Fix the Debt propagandists.

You can understand Republicans wanting to crush government and hoping to slow the recovery in a way that harms the Democrat in the 2014 midterm elections. But what is the president thinking?

Listen to a “senior economic official,” as quoted in today’s New York Times’s authoritative story revealing that the administration will offer to cut Social Security (by the backdoor method of reducing the cost of living adjustment via the “chained” Consumer Price Index) and Medicare if the Republicans will reciprocate with tax increases. “[T]he things like C.P.I. that Republican leaders have pushed hard for will only be accepted if Congressional Republicans are willing to do more on revenues.”

According to the Times story, the President has decided to pick up where he left off with Speaker John Boehner and put the final deal on the table, opening with big cuts in the two most popular programs that voters count on Democrats to defend. Reporter Jackie Calmes tells us, “In a significant shift in fiscal strategy, Mr. Obama on Wednesday will send a budget plan to Capitol Hill that departs from the usual presidential wish list that Republicans typically declare dead on arrival. Instead it will embody the final compromise offer that he made to Speaker John A. Boehner late last year.”

What could possibly go wrong with this bold, new strategy? (Actually the same strategy that has failed Obama since January 2009). Just about everything.

First, even if (it) works, the ten-year grand bargain that results will condemn the economy to a decade of low-level depression.

Second, the Republicans have a well-established history of taking the White House final offer as the starting point. As any smart negotiator knows, you don’t offer your final position in the opening bid.

Last, the strategy gives away the Democrats’ crown jewels — their defense of Social Security and Medicare, which should not be part of a budget deal in the first place. Now voters can conclude that they can’t trust either party.

Is their any silver lining? Maybe House Speaker Boehner, once again, will save the president from himself by failing to deliver enough Republicans for a tax increase.

Maybe outraged rank and file Democrats in the House and Senate will get energized and refuse to support Obama’s proposed deal. And maybe the slowing of the economy, after this year’s down-payment on a grand budget bargain, will get Obama’s attention.

How much evidence do we need that neither austerity nor appeasement is smart strategy?

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