December 10, 2012

New Poverty Window Opens: 55 to 67

Social Security and Medicare were instituted to combat the damning scourge of Senior poverty in America. Today most Americans may be living longer, but becoming poor younger. Our economy has changed since the 1960’s and that change has not been kind to the Middle Class, especially to workers over 50. Increasingly they are targeted as a cost cutting opportunity by company managers seeking to fatten their bottom lines. Once people in their 50’s and early 60’s could count on achieving their highest incomes in those years that directly preceded retirement Not any longer, now their larger paychecks make them the prey of corporate knives.

When layoffs happen in that age group, future job prospects are uncertain at best. One thing though is certain, odds are that any employment they might still secure will be at substantially less pay and with fewer, if any benefits. That is the essential backdrop to the current negotiations about the so called fiscal cliff. The wave of new poverty now hitting Americans over 55 is, to a large extent still happening below the radar. Older Americans who had been preparing for their pending retirement have had to revise their plans radically. Many now stay afloat in a manner reminiscent of a middle class lifestyle only by tapping into resources now that were meant to sustain them in later years.

Gone are the days of corporate pensions and gold watches gratefully given for decades of loyal service. Millions of Americans are now limping toward the finish line of their working careers, trying to hold on until programs like Social Security and Medicare finally kick in to give them a life sustaining boost. What is the response out of Washington to the emergence of this new window of Senior poverty? A drive to cut back “entitlement” spending is now gathering momentum. One of the proposals getting most of the buzz, especially in Republican circles, is to raise the eligibility age for Medicare by two years to 67. With their incomes plunging and their personal resources drained, how will many Americans survive being forced to forgo the availability of affordable health care for an additional two years? The answer is some won’t.

How much money will the federal budget save by denying Medicare to Americans until they reach 67. Most say on the order of 15 Billion a year, or 150 Billion over a decade. Let’s put that into perspective. By allowing the Bush Tax cuts to fully expire, as originally intended, simply on incomes ABOVE $250,000 a year, nearly a trillion dollars in new revenue will enter federal coffers over the next decade. But Republicans are balking. Not only would they rather raise that money by closing unidentified tax “loopholes” (likely including charity deductions and tax write offs for health care costs), they want that figure cut back to 800 billion instead, so the rich can pocket the 200 billion dollar difference. The Republicans prefer all Americans be forced to wait two more years to qualify for Medicare so that the wealthiest 2% of Americans won’t need to pay the full Bill Clinton era tax rates on their incomes above $250,000.

Here is another way of viewing our budget choices, credit to this Reuters article:

Exclusive: U.S. sees lifetime cost of F-35 fighter at $1.45 trillion
By Andrea Shalal-Esa
WASHINGTON | Thu Mar 29, 2012 1:28am EDT
http://www.reuters.com/article/2012/03/29/us-lockheed-fighter-idUSBRE82S03L20120329

’The U.S. government now projects that the total cost to develop, buy and operate the Lockheed Martin Corp F-35 Joint Strike Fighter will be $1.45 trillion over the next 50-plus years, according to a Pentagon document obtained by Reuters.

The Pentagon's latest, staggering estimate of the lifetime cost of the F-35 -- its most expensive weapons program -- is up from about $1 trillion a year ago, and includes inflation…

The new cost estimate reflects the Pentagon's proposal to postpone orders for 179 planes for five years, a move that U.S. official say will save $15.1 billion through 2017, and should avert costly retrofits if further problems arise during testing of the new fighter, which is only about 20 percent complete.

The Pentagon still plans to buy 2,443 of the new radar-evading, supersonic warplanes, plus 14 development aircraft, in the coming decades, although Air Force Secretary Michael Donley last week warned that further technical problems or cost increases could eat away at those numbers.”

Note the timely coincidence. The Pentagon expects to save $15.1 Billion through 2017 by postponing orders for 170 of those planes. That’s what Republicans want to cut Medicare by annually.

Life is full of choices. We pay for a military in the belief that it will protect our life and liberty. We pay for health care for essentially the same reason. Our Air Force is already dominant in the world, how many F-35’s do we need when they compete in cost with Medicare?

Our neighbors to the north just faced a similar decision making process and Canada seems to have thought better of buying a fleet of F-35’s given its current price tag:

Federal government cancels F-35 fighter purchase: source
Michael Den Tandt
Published: December 6, 2012, 1:46 pm
http://o.canada.com/2012/12/06/1107-col-dentandt/

“Faced with the imminent release of an audit by accountants KPMG that will push the total projected life-cycle costs of the aircraft above $30 billion, the Harper Conservatives have decided to scrap the controversial sole-source program and go back to the drawing board, a source familiar with the decision said. This occurred after Chief of the Defence Staff Thomas Lawson, while en route overseas, was called back urgently to appear before members of the cabinet, the source said.

The decision was to go before the cabinet planning and priorities committee Friday morning but the outcome is not in doubt, the source said.”

Of course we wouldn’t be facing decisions like this today if the last Bush Administration had done what American Presidents have always done before to pay for the guns of war when major armed conflicts emerge; raise the revenue to pay for them. If Republicans don’t like forcing the wealthy to pay their fair share so that Medicare remains available at age 65 for Americans who need it, there is a ready alternative. Tell them they are just picking up their share of the cost for George W. Bush invading Iraq.

December 9, 2012

Democrats lost the Public Option and got drubbed in 2010

If Democrats compromise Medicare or Social Security now they wil lose in 2014 also When the most important advance in social welfare legislation since Medicare was handed off to the private Insurance industry virtually exclusively to monopolize, it was like a gut punch to progressive forces. An energized movement that had swept back to back elections in 2006 and 2008 for the Democratic Party spontaneously deflated.

I am not focusing on policy per se right now, not on the argument over what was and was not possible to actually achieve regarding health care, just on the predictable outcome that happens when hopes and dreams are dashed. Politics comes down to people, especially on the Democratic side of the equation.

Democrats by and large are not as self centered as are the elites that fund the Republican Party. We actually do embrace the concept of shared sacrifice, we expect to have to give as individuals to help keep our nation great. But we also believe that what makes our nation great is a society that does not demand that citizens give up what they literally can not afford to lose. We do not believe Americans should be forced into "sacrifices" that jeopardize their health and physical well being, to the point of risking their very lives. Not while there is great, even obscene, wealth awash in confined sectors of this nation we don't

Any betrayal of that core sense of fairness, which underlies the loyalty that motivates millions of liberals and progressives to work their asses off for Democratic candidates for office and to donate hard earned dollars to Democratic campaigns, will cripple the Democratic Party in the next mid-term elections. It is really that predictable and unavoidable a dynamic that Democrats would do well to ponder now during negotiations with the Republicans over the so-called Fiscal cliff".

Raising the age of Medicare eligibility is the very last option that the core Democratic base would consider in regards to cutting our deficits. To put it in blunter terms, if one dime of the Bush tax cuts for the rich gets preserved as the result of current negotiations, if the top tax rate on the wealthiest Americans does not rise all of the way back to Clinton Administration levels, or if the threshold for those cuts is raised above the $250,000 a year income level, that will mean more food and health care denied to some of the neediest in our nation. Democratic voters will revolt if that happens, just like what happened in 2010.

It will happen at a level deeper than any appeal to reason can touch. People can be talked into continuing a relationship for pragmatic reasons after experiencing personal betrayal, but they can't be "reasoned into" continuing it with the same passion and devotion. In a post "Citizens United" political universe, Democrats literally can't afford that type of drop off in voter base enthusiasm.

Republicans argue that even if the rich resume paying the tax rates they paid in the 1990's, the added revenue won't be nearly enough to right our fiscal ship. All the more reason to demand that the wealthy pay those rates now in full AND close tax loopholes closed that predominantly benefit the upper class - who collectively have flourished while the rest of the nation has suffered. Instead Republicans perversely argue that the rich are the ones who should be spared greater so-called sacrifices.

Millions of Americans are today living in part off of savings they once earmarked for their retirement. Americans who lose well paying jobs after they turn 50 can't replace them. Increasingly those approaching retirement age are limping toward that finish line, just trying to hold on until they can qualify for Social Security and Medicare. Pushing Medicare eligibility back two years would be the functional equivalent of a death sentence to tens of thousands of Americans. That is not a Democratic value, and voters know when their interests are being sold out.

December 8, 2012

Better moderates like Crist become Democrats than launch a "Third Way" Party

The Republican Party has moved so far right that something has got to give, moderates can no longer continue to support it. Either they will move into the Democratic Party gravitational field or I predict there will be a major launching of a new Centrist political party within the next eight years.

Think how close that has come already since Perot ran the first time, and then Jesse Ventura got elected Governor. Think Colin Powell and Mayor Bloomberg. Think Arnie out on the West Coast and Lincoln Chaffee in the East. On our side look at Ben Nelson, and Evan Bayh and how close they might be to bolting. Remember how Lieberman won his last election.

I do not welcome new Democrats in name only into our Party, pure opportunists in other words, because they are a Trojan horse at best. But I prefer that sane independent oriented thoughtful moderates defecting from the Republican fold affiliate with Democrats than have a new powerful centrist movement emerge in American politics right now. When conscientious moderates leave the Republican Party, they tend to begin evolving toward increasingly progressive positions.

December 6, 2012

In facing the “Fiscal Cliff”, what exactly does “Shared Sacrifice” mean?

I know the obvious definition, which goes something like; “to get our economic house in order, everyone has to share the burden”. OK, fine, so we share the burden. But what does that really mean? Are Americans being asked to share “the burden” equally? And just what constitutes a burden anyway? A light backpack is hardly burdensome to a healthy adult hiker, but most four year olds couldn’t handle carrying it for long. Cut the caloric intake of an overweight individual and most would call it dieting. Cut the caloric intake of someone severely malnourished and starvation becomes the more accurate term. But hey, both individuals are giving up something. That is what passes for “shared sacrifice” in Washington lately, at least in Republican circles.

All Americans are supposed to ante up “some skin in the game.” of fighting our budget deficits. Whether that is through liposuction or through amputation is of secondary concern. What matters now is making “the numbers add up”. So long as each side “gives up something” it’s supposed to be “fair”. Split the baby down the middle. Isn’t that what compromise is all about?

The Republican position during the fiscal cliff negotiations is not just totally discredited (the entire 2012 election campaign centered on the question of “fair taxes” and Republicans came up short), it is also morally obscene. The added pain that they now propose fall most heavily on many of our nations most vulnerable citizens was entirely of their own doing

The George W. Bush tax cuts were designed originally to be temporary. Bush campaigned in 2000 arguing that the government was hoarding way too large a surplus, and that much of it should be given back to tax payers in the form of a temporary tax cut. Polling at the time showed most Americans disagreed with Bush’s tax proposal. It was viewed even then as a giveaway to the rich and a reckless potential budget buster. Americans preferred that more of the surplus That Bush inherited from Clinton be used to shore up social security than what Bush chose to allott for that purpose

Though he ultimately won the presidency with a controversial “assist” from the Supreme Court, no one disputes that George Bush lost the popular vote in the 2000 election to Al Gore. Bush was not Americans first choice for President. The Bush tax cuts only became law because his running mate Dick Cheney was in place to cast a tie breaking vote in the Senate to make them into law.

The irony here is hard to miss. In 2000 Polls showed that Americans opposed Bush’s tax plans, Al Gore won more votes for President that George Bush did, yet Bush forced his tax plan through a Senate that was bitterly divided on partisan lines. That is how Republicans traditionally define “compromise” Fast forward to 2012. President Obama campaigned for reelection by strenuously arguing that the Bush tax cuts for the richest 2% of Americans should be allowed to expire, as originally intended, on all income over $250,000. Polls show that the American people agree with the President’s position on this issue, and Obama received over 4 million more votes than his Republican opponent.

So naturally the Republicans in Congress now propose Mitt Romney’s campaign platform as their idea for a budget compromise. I called their position morally obscene above, and I meant it. On one hand Republicans argue that “painful cuts” must be made to entitlement spending because even if Bush’s tax cuts for the rich are allowed to expire the Trillion dollars in revenue that would generate still falls well short of stanching the red ink of our future deficits. Then Republicans turn around and advocate a plan that raises 20% less in actual revenue than the lapsed Bush tax cuts on the wealthy by themselves would bring in.

An additional 200 Billion dollar shortfall, do you know what that could pay for? When all is said and done its close to an even trade – Republicans want to give those dollars back to the wealthy and offset that cost by raising the age of Medicare to 67 to balance the ledger.

There are many differences between the wealthiest Americans and most of their fellow citizens, but the ability to plan for a comfortable retirement and the means to afford quality health care are prominent among the advantages they typically enjoy. Medicare was created to address Senior Poverty, specifically the inability of aging Americans to afford health insurance in their retirement years when their incomes typically are most limited. Most Americans may be living longer today than when Medicare was first established, but millions of us are becoming poorer sooner.

There is no such thing as reliable employment for life any longer. Pensions are going the way of wind up watches, and few of us are earning gold ones, wind up or not, from grateful employers these days. Pink slips are far more likely, especially for workers over 50 with seniority generated higher wages and benefits. It is a rapidly shrinking percentage of older Americans who can count on retiring from a well paid job when 65 rolls around, with or without an employer provided pension. It’s increasingly more common for late middle age Americans to burn through their retirement savings trying to stay afloat during the decade before they can finally qualify for Social Security and Medicare.

Allowing the Bush tax cuts for the wealthy to finally expire is the least the wealthiest Americans can do for their fellow countrymen and women now after well over a decade of sustained and dramatic income growth within their ranks during a time when real income for the vast majority of Americans has stagnated or actually fallen. That doesn’t qualify as a sacrifice, it is merely justice delayed. Only then can we begin negotiating what burdens each of us as Americans are reasonably in a position to bear in order to put our nation’s finances on sounder footing.